Exhibit 10.11
NANODYNAMICS, INC.
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT, effective as of May 1, 2007, is made by and
between Xxxxx Xxxxxxxxx, an individual residing at 00 Xxxxx Xxxxx, Xxxxx Xxxxx,
Xxx Xxxx 00000 ("Consultant") and NanoDynamics, Inc., a Delaware corporation
with its principal place of business at 000 Xxxxxxxx Xxxxxxxxx, Xxxxxxx, Xxx
Xxxx 00000 (together with its wholly-owned subsidiaries, "Nano").
1. Services. Consultant shall consult with Nano's Chief Executive Officer
("CEO") and such other members of senior management of Nano as CEO designates
with regard to various transactions in which Nano may be involved, such as
product or technology licensing arrangements, research and development
sponsorships, mergers, acquisitions, joint ventures and any other transaction
reasonably requested and specifically identified in writing by Nano (a
"Transaction"). Consultant will advise and assist Nano in the course of its
negotiation of any Transaction(s) and, if requested by Nano, will participate
directly in such negotiations. The services to be performed by Consultant in
accordance with this Agreement are referred to herein as the "Consulting
Services."
2. Term. The term of this Agreement shall continue until March 31, 2010
(the "Initial Term") and shall automatically renew for successive one-year
periods (each, a "Renewal Term") unless written notice of non-renewal is given
by either party not less than sixty (60) days' prior to the expiration of the
Initial Term or any Renewal Term, as applicable. As used herein, "Term" shall
mean the period commencing on the date hereof and ending on the date this
Agreement terminates in accordance with the provisions of this paragraph or
paragraph 3 below.
3. Termination.
a. Consultant may terminate this Agreement upon sixty (60) days' prior
written notice to Nano.
b. Nano may terminate this Agreement upon (i) the death or Disability
of Consultant or (ii) for Cause. "Disability" shall mean the inability or
failure of Consultant to provide Consulting Services for any sixty (60)
continuous days or for a total of one hundred-twenty (120) days during any one
year period of the Term. "Cause" shall mean Consultant has been found by Nano's
Board of Directors (the "Board") to have (i) committed fraud or gross negligence
in connection with the Consulting Services or otherwise with respect to the
business and affairs of Nano; (ii) engaged in misconduct with respect to the
business and affairs of the Company with actual knowledge that such actions
violate legal directions and instructions of the Board consistent with this
Agreement; or (iii) been found by a court of competent jurisdiction to have
committed or plead guilty to an unlawful act whether or not related to the
business of Nano if the commission of such act has a material adverse effect
either on (a) Consultant's ability to perform the Consulting Services or (b)
Nano's reputation and goodwill. Cause shall be found only after Consultant has
received notice from the Board, has had an opportunity to
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discuss the issues with the Board and has been given a thirty (30) day period
to cure, where cure is feasible
c. In the event this Agreement is terminated by Nano other than for
Disability or Cause, Nano shall continue to make the payments required by
paragraphs 4(a), 4(c) and 4(d) below with respect to the balance of the Initial
Term or any Renewal Term, as applicable. In the event of termination because of
Consultant's death, Nano shall continue to make the payments required by
paragraph 4(a) for the lesser of six (6) months or the balance of the Initial
Term or any Renewal Term, as applicable.
4. Compensation and Expenses. In consideration of Consultant's performance
of the Consulting Services, Term Consultant shall be entitled to the following:
a. Nano shall pay Consultant a monthly cash fee of $13,500, payable in
quarterly installments.
b. Nano will reimburse Consultant on a monthly basis for any
reasonable and necessary expenses incurred by Consultant in connection with the
execution of the Consulting Services, including all travel expenses incurred to
and from all work sites, business related meal expenses, administrative
expenses, lodging expenses (if work demands overnight stays) and other
miscellaneous travel-related expenses (parking and tolls), provided that
expenditures in excess of $1,000 must be pre-approved by Nano.
c. Nano will continue to make all lease payments for the offices at 00
Xxxxxxxxxx Xxxx, Xxxxx 000, Xxxxx Xxxx, Xxx Xxxx 00000 until the expiration of
the lease on or about February 28, 2010. During such period, Nano shall provide
Consultant with use of such space on a basis substantially equivalent to the use
of such space during the period in which Consultant served as Nano's Chairman of
the Board.
d. In the event a Transaction with respect to which Consultant has
performed Consulting Services is completed with twelve (12) months following the
Term, Nano shall pay Consultant a fee (the "Transaction Fee") equal to (i) 5% of
the first $1,000,000 of the consideration paid in such transaction; (ii) 4% of
the second $1,000,000 of the consideration paid in such transaction; (iii) 3% of
the next $1,000,000 of the consideration paid in such transaction; (iv) 2% of
the next $1,000,000 of the consideration paid in such transaction; and (v) 1% of
any consideration in excess of $5,000,000. The Transaction Fee shall be paid to
Consultant within two (2) business days following the closing of the
Transaction, except with respect to any portion of the Transaction consideration
that is payable in installments where the Transaction Fee payments shall be made
to Consultant at the same time. Notwithstanding the foregoing, Nano shall not be
obligated to pay any Transaction Fee with respect to a Transaction completed
after the Term if this Agreement was terminated by Nano for Cause.
5. Confidential Information. Consultant recognizes and acknowledges that
the technology, product candidates, development and business plans,
etc.("Confidential Information") possessed by Nano or otherwise under Nano's
control are valuable property rights
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to be kept confidential and secret, and therefore agrees to keep confidential
and not disclose or use (except in connection with the fulfillment of the
Consulting Services under this Agreement) any Confidential Information.
Confidential Information shall not include information that: (a) is now or
subsequently becomes generally available to the public through no wrongful act
or omission of Consultant or anyone to whom Consultant disclosed such
information; (b) Consultant can demonstrate by its written records to have had
rightfully in its possession prior to disclosure to Consultant by Nano; (c) can
be demonstrated by Consultant's written records to have been independently
developed by the Consultant without use, directly or indirectly, of any
Confidential Information; or (d) the Consultant rightfully obtains from a third
party who has the right to transfer or disclose it.
6. Nondisclosure. Except as has been specifically authorized by Nano in
writing, Consultant shall not reproduce, use, distribute, disclose or otherwise
disseminate the Confidential Information and shall not take any action causing,
or fail to take any reasonable action necessary to prevent any Confidential
Information disclosed to Consultant to lose its character as Confidential
Information. Consultant shall use the Confidential Information solely for the
purpose of providing consulting services to Nano under this Agreement.
Consultant shall not remove Confidential Information from Nano or the
location(s) designated by Nano except as expressly permitted in writing by Nano.
7. Return of Information. Upon termination of this Agreement or earlier
upon request by Nano, Consultant shall promptly deliver to Nano all Confidential
Information and all embodiments thereof then in its custody, control or
possession.
8. Representation of Consultant. Consultant hereby represents that there
are no binding agreements to which the Consultant is a party or by which
Consultant is bound, forbidding or restricting his/her activities herein. In
addition, the Consultant consents to being named as a Consultant in various
reports, brochures or other documents produced by or on behalf of Nano,
including any and all documents filed with the Securities and Exchange
Commission.
9. Ownership of Inventions. In consideration for the compensation paid to
Consultant by Nano in paragraph 4, Consultant hereby assigns to Nano all right,
title and interest in all inventions which arise from consulting activities for
Nano hereunder, and agrees to cooperate fully in the prosecution of any patent
application resulting from any such invention, at the expense of Nano, which
cooperation shall include executing any necessary documents in connection
therewith.
10. Independent Contractor. Consultant shall be deemed at all times to be
an independent contractor and shall be wholly responsible for the manner in
which he/she performs the services required of him/her by the terms of this
Agreement. Nothing contained in this Agreement shall be construed as creating
the relationship of employer and employee between Consultant and Nano.
11. Liability; Indemnification. Consultant shall not be liable to Nano, or
to anyone who may claim any right due to any relationship with Nano, for any
acts or omissions in the performance of the Consulting Services, except when
said acts or omissions arise from Consultant's willful misconduct or gross
negligence. Nano shall indemnify and hold Consultant
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free and harmless from any obligations, costs, claims, judgments, attorneys'
fees, and attachments arising from or in any way connected with the Consulting
Services, except when the same shall arise from Consultant's willful misconduct
or gross negligence as adjudicated by a court of competent jurisdiction.
12. Assignment. It is understood and agreed that the services to be
performed by the Consultant under this Agreement are personal in character and
neither this Agreement nor any duties or obligations hereunder shall be assigned
or delegated by Consultant without prior approval by Nano.
13. Agency. The parties do not intend that any agency, license or
partnership relationship be created between them by this Agreement.
14. Governing Law; Consent to Jurisdiction. This Agreement shall be
governed by and construed in accordance with the laws of the State of New York.
15. Arbitration. Any dispute relating to this Agreement shall be submitted
to and decided by the American Arbitration Association in accordance with the
rules of the American Arbitration Association.
16. Notices. All notices to be given by the parties hereto shall be in
writing and served either by personal delivery or by depositing same in the
United States mail, postage prepaid, and addressed to the parties as indicated
in the beginning of this Agreement.
17. Severability. If any term or provision of this Agreement shall be found
to be illegal or unenforceable by a court of competent jurisdiction, the
remaining provisions will nevertheless continue in full force and effect without
being impaired or invalidated in any way.
18. Survival. The provisions of this Agreement relating to confidentiality,
assignment of inventions, and cooperation during patent prosecution shall
survive any termination or expiration hereof.
19. Entire Agreement. This Agreement constitutes the entire agreement
between the parties regarding the subject matters set forth herein and
supersedes any and all prior and contemporaneous agreements, representations,
and understandings of the parties, whether written or oral, regarding such
matters. This Agreement may not be changed, modified, amended or supplemented
except by written instrument signed by both parties.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date and the year first above written.
NANODYNAMICS, INC. CONSULTANT
By: /s/ Xxxxx X. Xxxxxxx /s/ Xxxxx Xxxxxxxxx
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Name: Xxxxx X. Xxxxxxx Xxxxx Xxxxxxxxx
Title: Chief Executive Officer
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