CONSULTING AGREEMENT
Exhibit
10.1
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A.
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QUINTEK
is in the business of providing hardware, software and services
for the
Document Imaging and Business Process
market;
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B.
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QUINTEK
desires to retain Consultant to provide executive advisory assistance,
pursuant to which Xxxxx Xxxxxx (“Executive”) will become the
President and Chief Executive Officer
of
QUINTEK.
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C.
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Consultant
desires to accept such agreement upon the terms and conditions
set forth
herein.
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NOW,
THEREFORE,
in
consideration of the mutual promises contained herein, and for other valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the
parties hereby agree as follows:
1.
Scope
of the Engagement.
1.1
For
purposes of this engagement, Consultant will provide the services of Executive
to serve as the President and Chief Executive Officer of QUITEK. Executive
will
provide the standard services of a contract CEO to include overseeing the
day-to-day operations of QUINTEK, SEC filings, sales, financial analysis
and
capital raising, projections, banking and strategic analysis.
1.2 Executive
shall do and perform all services and actions necessary or advisable to
promote
the continued success of QUINTEK’S business, subject to the instructions,
policies and limitations which may be set from time to time by its Board
of
Directors (the “Board”).
1.3 Consultant
shall devote its time, ability and attention to the business of QUINTEK
during
the term of this Agreement with the exceptions noted in 1.4 below. Consultant
shall not directly or indirectly render any services of a business, commercial
or professional nature to any other person or organization, whether for
compensation or otherwise, without the prior written consent of the Board.
1.4 QUINTEK
hereby provides consent for Consultant to continue working in an advisory
and
consulting capacity which is not in competition with QUINTEK, as long such
involvement does not detract from its responsibilities to QUINTEK.
1.5 Consultant
acknowledges and agrees that Executives services to QUINTEK are of a special,
unique and extraordinary character and further acknowledges and agrees
that a
breach of any of the covenants or agreements contained in this Agreement
(including but not limited to Sections 2.2 and 7 hereof) is likely to result
in
irreparable and continuing damage to QUINTEK for which there will be no
adequate
remedy at law. Accordingly, in the event of such breach QUINTEK shall be
entitled to injunctive relief and/or a decree for specific performance,
and such
other and further relief as may be proper (including monetary damages,
if
appropriate).
2. Term.
2.1 The
term
of this Agreement shall be for five (5) years.
2.2 Consultant
agrees to provide QUINTEK with ninety (90) days written notice prior to
terminating this Agreement.
2.3 If
Consultant is terminated prior to the fifth anniversary of this Agreement
for
reasons other than “for cause” or if Executive becomes “Disabled” (as defined
herein), QUINTEK will provide Consultant with twelve (12) months’ notice prior
to terminating this Agreement. If, however, QUINTEK does not provide Consultant
with twelve (12) months’ notice or provides less than twelve (12) months’
notice, it shall provide Consultant with an equivalent amount of pay in
lieu of
notice for all or any portion of the twelve (12) months’ notice not provided.
Such pay in lieu of notice is in addition to any other sums which may be
owed to
Consultant pursuant to this Agreement. Any pay in lieu of notice shall
constitute severance pay (“Severance”) and shall be paid over the course of the
pay in lieu of notice period in accordance with QUINTEK’s regular payroll
practices at the rate of the then-current compensation. In no event shall
QUINTEK be required to pay Severance if Consultant resigns, is terminated
after
the fifth anniversary of this Agreement for any or no reason, if Consultant
is
terminated because Executive has become “Disabled” or if Consultant is
terminated at any time “for cause”, other than as set forth in Paragraph 2.6. In
the event that QUINTEK’s Recast Profits (as defined in Paragraph 3.3) for the
twelve (12) month period prior to termination amount to less than Two Million
Dollars ($2,000,000), QUINTEK shall pay a separation benefit equivalent
to three
month’s compensation at the then-current rate.
2.4 As
used
herein, the term “for cause” shall be limited to the following:
2.4.1 Consultant’s
continued failure or habitual neglect to perform its duties as set forth
in
Section 1 of this Agreement after receiving written notice of the alleged
deficiencies and having had an opportunity to improve; or
2.4.2 Consultant’s
engaging in any activity or conduct which is specifically precluded by
this
Agreement, including any activity competitive with or intentionally injurious
to
QUINTEK; or
2.4.3 Intentional
malfeasance or misfeasance or gross neglect of duty engaged in by Consultant
while carrying out its duties owing to QUINTEK under this Agreement; or
2.4.4 Executive’s
impairment due to alcohol or other substance abuse which in the reasonable
judgment of QUINTEK affects or interferes with, or may affect or interfere
with,
Executive’s performance or capacity to properly discharge Executive’s duties,
such impairment not to include an isolated incident occurring off the premises
during non-working hours; or
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2.4.5 The
commission by Executive of a felony or a crime involving moral turpitude
(whether or not prosecuted), the charge or indictment of Executive by a
governmental or prosecutorial authority of the same or the pleading by
Executive
of no contest (or similar plea) to the same, whether or not committed in
the
course of his employment; or
2.4.6 Consultant’s
committing any act of dishonesty against QUINTEK or using or appropriating
for
its personal use or benefit any funds or properties of QUINTEK, unless
such use
or appropriation was specifically authorized by the Board in
writing.
2.5 This
Agreement shall not be terminated by any merger or consolidation where
QUINTEK
is not the consolidated or surviving corporation or by any transfer of
all or
substantially all of the assets of QUINTEK. In the event of any such merger
or
consolidation or transfer of assets, the surviving or resulting corporation
or
the transferee of the assets of QUINTEK shall be bound by and shall have
the
benefit of the provisions of this Agreement, and QUINTEK shall take all
steps
necessary to ensure that such corporation or transferee is bound by the
provisions of this Agreement.
2.6 If
Consultant is terminated prior to the fifth anniversary of this Agreement
“for
cause” as defined by Paragraphs 2.4.1 and 2.4.4, QUINTEK shall pay Consultant
a
separation benefit equivalent to one month’s base compensation at the
then-current rate (“Separation Benefit”).
2.7 QUINTEK
may terminate Consultant if Executive becomes Disabled, such termination
to be
made in QUINTEK’s sole discretion. For
the
purposes of this Agreement, “Disabled” shall mean that Executive is unable to
perform his duties hereunder, either with or without a reasonable accommodation,
as the result of his incapacity due to physical or mental illness or condition,
and such inability continues for at least thirty (30) consecutive calendar
days
or equals or exceeds sixty (60) calendar days during any consecutive twelve
(12)-month period. If Consultant is terminated prior to the fifth anniversary
of
this Agreement due to Executive becoming Disabled, QUINTEK shall pay Consultant
a separation benefit equivalent to three month’s base compensation at the
then-current rate (“Disability Benefit”).
2.8 As
a
precondition to paying the foregoing Severance, Separation Benefit or Disability
Benefit, QUINTEK may require that Consultant re-confirm its obligations
under
Paragraph 7 and execute a general release of any and all claims it might
have
against QUINTEK, whether arising out of its consulting agreement or termination
of the consulting agreement, other than QUINTEK’s obligation to pay the
Severance, Separation Benefit or Disability Benefit, as the case may be.
Furthermore, any compensation, severance, separation benefit or disability
benefit or other amounts due to Consultant following termination may be
offset
against any amounts due to QUINTEK from Consultant.
3.
Compensation.
3.1 As
compensation for services hereunder, Consultant shall receive monthly
compensation of $15,000 per month (the “Compensation”), during the term of this
Agreement, subject to adjustment as set forth in Paragraph 3.2
below.
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3.2 Compensation
shall remain unchanged until such time as QUINTEK’s quarterly Gross Revenue
shall exceed or equal the sum of $900,000. If QUINTEK’s quarterly Gross Revenue
shall exceed or equal the sum of $900,000, Compensation for the following
quarter shall be increased to the sum of $18,000 per month. If QUINTEK’s
quarterly Gross Revenue shall exceed or equal the sum of $1,200,000,
Compensation for the following quarter shall be increased to the sum of
$21,000
per month. If QUINTEK’s quarterly Gross Revenue decreases at any time,
Compensation shall be decreased to the corresponding monthly compensation
described in this Paragraph, subject to a final reduction to the base
Compensation amount set forth in Paragraph 3.1 above. For the purposes
of this
Agreement, “Gross Revenue” shall be defined as QUINTEK’s gross revenue for the
applicable quarter as calculated by QUINTEK’s regular accountant(s).
3.3 In
addition, Consultant will be eligible to receive an annual bonus based
upon the
Recast Profits of QUINTEK over the prior twelve (12) month calendar/fiscal
year
period. If QUINTEK’s Recast Profit Margin for the prior twelve (12) month
calendar/fiscal year period is less than six (6%) percent then Consultant
will
not receive any bonus. If QUINTEK’s Recast Profit Margin for the prior twelve
(12) month calendar/fiscal year period equal or exceed six (6%) percent,
then
Consultant will be paid a bonus of three (3%) percent of Recast Profits,
within
thirty (30) days of such year end. For each additional one (1%) percent
of
Recast Profits over and above six (6%) percent of Recast Profits for the
prior
twelve (12) month calendar/fiscal year period, Consultant will receive
an
additional bonus of one (1%) percent of Recast Profits within thirty (30)
days
of such year end, such additional bonus to be prorated for each additional
one
(1%) percent in Recast Profit Margin over and above the sum of six (6%)
percent
of Recast Profit Margin for the prior twelve (12) month calendar/fiscal
year
period. For example, if at the end of calendar/fiscal year 2007, QUINTEK’s
Recast Profits for the prior year amount to $994,200 then Consultant would
be
paid the sum of $59,552 within thirty (30) days. For the purposes of this
agreement, “Executive’s Compensation” is defined as Executive’s salary, car
allowance (not to exceed Five Hundred Dollars ($500) per month and interest
paid
on Executive’s loans (if any) to QUINTEK, as calculated by QUINTEK’s regular
accountant(s). For the purposes of this Agreement, “Recast Profits” shall be
defined as net profits before interest, taxes, depreciation and amortization
(EBITDA), less Executive’s Compensation. For the purposes of this Agreement,
“Recast Profit Margin” shall be defined as the quotient of Recast Profits
divided by Gross Revenue
3.4 Consultant
will be paid a car allowance of Five Dollars ($500) per month during the
term of
this Agreement. This automobile allowance will be QUINTEK’s sole obligation with
respect to Consultant’s leased or owned automobile; Consultant will maintain the
costs of license, insurance and maintenance during this period. In addition,
Consultant accepts such automobile allowance on such terms and conditions
as
QUINTEK may establish from time to time regarding the payment of an automobile
allowance to its employees.
3.5 Other
Benefits. Executive shall be entitled to continue to participate in or
receive
benefits under all of the Employee Benefit Plans of QUINTEK under which
Employee
may participate in accordance with applicable laws and the terms of such
plans
in effect on the date hereof, or under plans or arrangements that provide
Executive with at least substantially equivalent benefits to those provided
under such Employee Benefit Plans. As used herein, "Employee Benefit Plans"
include, without limitation, each pension, and retirement plan; supplemental
pension, retirement, and deferred compensation plan; savings and profit-sharing
plan; stock ownership plan; stock purchase plan; stock option plan; life
insurance plan; medical insurance plan; disability plan; and health and
accident
plan or arrangement established and maintained by QUINTEK on the date hereof.
Executive shall be entitled to participate in or receive benefits under
any
employee benefit plan or arrangement which may, in the future, be made
available
to QUINTEK's executives and key management employees, subject to and on
a basis
consistent with the terms, conditions, and overall administration of such
plan
or arrangement. Nothing paid to Executive under the Employee Benefit Plans
presently in effect or any employee benefit plan or arrangement which may
be
made available in the future shall be deemed to be in lieu of compensation
payable to Executive. Any payments or benefits payable to Executive under
a plan
or arrangement in respect of any calendar year during which Executive is
employed by QUINTEK for less than the whole of such year shall, unless
otherwise
provided in the applicable plan or arrangement, be prorated in accordance
with
the number of days in such calendar year during which he is so employed.
Should
any such payments or benefits accrue on a fiscal (rather than calendar)
year,
then the proration in the preceding sentence shall be on the basis of a
fiscal
year rather than calendar year.
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3.6 Offices.
Executive agrees to serve as a director of QUINTEK, if elected or appointed
thereto, provided he is indemnified for serving in such capacity on a basis
no
less favorable than is currently provided by QUINTEK's By-laws and any
indemnification agreement with any other director.
4. Business
Expenses.
Consultant is
authorized to incur reasonable expenses for promoting and conducting the
business of QUINTEK, including reasonable expenditures for entertainment
and
travel. QUINTEK shall reimburse Consultant monthly for all such business
expenses upon presentation of documentation establishing the amount, date,
place
and essential character of the expenditures, in such form as QUINTEK may
require
and sufficient to satisfy any Internal Revenue Code requirements for such
expenses to be deductible to QUINTEK..
5. Health
Insurance.
Consultant shall be entitled to receive such medical and dental insurance
benefits as are designated and made available by QUINTEK for its employees
generally, which benefits are subject to change or revocation at QUINTEK’ sole
discretion.
6. Independent
Contractor Relationship.
This
Agreement is intended to create an independent contractor relationship
between
Consultant and Company, which is described in Section 3508 of the Internal
Revenue Service Code, and shall be interpreted to effectuate such intent
between
the parties.
6.1 QUINTEK
will not withhold any taxes from any compensation paid to Consultant according
to this Agreement. It is acknowledged and agreed by the parties that QUINTEK
has
not, is not, and shall not be obligated to make, and that it is the sole
responsibility of Consultant to make, in connection with compensation paid
to
Consultant according to this Agreement, all periodic filings and payments
required to be made in connection with any withholding taxes, FICA taxes,
Federal unemployment taxes, and any other federal, state or local taxes,
payments or filings required to be paid, made or maintained.
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7.
Issuance
of Equity.
7.1 QUINTEK
agrees that is will issue to Consultant 2,000,000 options to purchase common
stock under the Company’s stock purchase plan. Stock options granted under the
Company's stock purchase plan will have the following criteria: they will
expire
5 years from the date of vesting or upon termination of this Agreement;
they
will give the Consultant the right to purchase stock in the Company at
and
exercise price equal to the prior day closing bid price as quoted on the
OTCBB,
vesting to occur immediately. QUINTEK acknowledges that it has committed
to sell
to Consultant additional shares of common stock (or grant to Consultant
rights
to purchase additional shares of common stock) in QUINTEK so that, including
all
options or shares previously issued to or purchased by Consultant, Consultant
would own, in the aggregate, shares of common stock or rights to purchase
shares
of common stock representing ten percent (10%) of the current outstanding
common
stock in QUINTEK prior to taking into account the issuance of such additional
shares to Consultant. QUINTEK and Consultant acknowledge and agree that
the
purchase price for such shares (or the exercise price for such options)
will be
the lesser of $.0662 per share or the “Fixed Conversion Price” of the Secured
Convertible Debentures issued by the Company and held by Cornell Capital
Partners. These options shall expire five years from the date of vesting.
It is
contemplated that QUINTEK and Consultant will enter into a separate agreement
or
agreements on these additional shares and/or options within 90 days of
the date
of this Agreement. Specifically, it is presently anticipated that the new
stock
agreement(s) will have, at minimum, new termination and repurchase provisions,
with the termination provisions to be consistent with the termination provisions
set forth in this Agreement. Options shall vest according to the following
schedule: Options giving Consultant the right to 2.5% of outstanding common
stock at the time of execution of this agreement, options giving Consultant
the
right to purchase an additional 2.5% of outstanding common stock will be
granted
to Consultant upon the 1 year anniversary of this agreement for the following
three years. In the event of a sale of QUINTEK, termination of this agreement
by
the Company, or any other event that may impede QUINTEK’s ability to fulfill its
obligations under this Agreement, all options will immediately vest.
7.1.1 Consultant
shall receive grant(s) of Preferred Stock upon achieving certain milestone
to be
determined within 30 days of the execution of this agreement.
7.2 Manner
of Exercise of Options.
The
options or rights to purchase common stock described in Paragraph 7.1 above
(collectively, the “Option”) may be exercised in whole at any time, or in part
from time to time, during the period commencing on the date of issuance
(“Base
Date”) and expiring on the date of expiration (“Expiration Date”) or, if any
such day is a day on which banking institutions in the City of New York,
New
York are authorized by law to close, then on the next succeeding day that
shall
not be such a day, by presentation and surrender of Options to QUINTEK
at its
principal office, or at the office of its stock transfer agent, if any,
with
QUINTEK’s Option Exercise Form duly executed and accompanied by payment (either
in cash or by certified or official bank check, payable to the order of
QUINTEK)
of the Exercise Price for the number of shares specified in such Form and
instruments of transfer, if appropriate, duly executed by the Holder or
its duly
authorized attorney.
7.3
Partial Exercise; Taxes. If
Option
should be exercised in part only, QUINTEK shall, upon surrender of Option
for
cancellation, execute and deliver a new Option evidencing the rights of
Consultant thereof to purchase the balance of the shares purchasable hereunder.
Upon receipt by QUINTEK of Option, together with the Exercise Price, at
its
office, or by the stock transfer agent of QUINTEK at its office, in proper
form
for exercise, Consultant shall be deemed to be the holder of record of
the
shares of common Stock issuable upon such exercise, notwithstanding that
the
stock transfer books of QUINTEK shall then be closed or that certificates
representing such shares of Common Stock shall not then be actually delivered
to
Consultant. QUINTEK shall pay any and all documentary stamp or similar
issuer
taxes
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8. Property
Rights, Confidential Information, and Trade Secrets of
QUINTEK.
8.1 As
used
in this Agreement, the terms “Confidential Information” and “Trade Secrets”,
collectively or individually, shall mean the following:
8.1.1 QUINTEK’s
contracts, marketing plans, purchases and sales, whether realized or in
development, including, without limitation, any source of ideas or
projects;
8.1.2 Information
relating to QUINTEK’s business, whether or not such information is in writing;
8.1.3 Information
relating to QUINTEK’s clients and candidates, including such persons’ resumes,
job descriptions, hiring needs and preferences, computer systems, expertise,
business endeavors, purchasing habits, and other information concerning
QUINTEK’s business relations with its clients and candidates;
8.1.4 Information
of a personal nature relating to QUINTEK’s employees, officers and managers,
including such persons’ salaries, benefits, special skills and knowledge,
identities and performance; and
8.1.5 QUINTEK’
records, including, but not limited to, electronic, written, typed, or
printed,
including without limitation client and candidates lists and charts, other
lists
and charts, memoranda, notebooks, correspondence, notes, letters, plans,
proposals, contracts, files, resumes, job descriptions, employee files,
manuals,
blank forms, materials and supplies, and all information therein contained,
and
similar items affecting or relating to the business of QUINTEK, whether
prepared
by QUINTEK, Executive, or otherwise, and any other tangible source of
information (whether or not written) relating to QUINTEK.
8.2 Consultant,
for the duration of this agreement has had and will have access to and
become
acquainted with Trade Secrets and/or Confidential Information of QUINTEK which
are owned by QUINTEK and which are regularly used in the operation of the
business of QUINTEK. Consultant shall not disclose any of the aforesaid
Trade
Secrets and/or Confidential Information, directly or indirectly, or use
Trade
Secrets and/or Confidential Information in any way, either during the term
of
this Agreement or at any time thereafter, except actions undertaken for
the
benefit of QUINTEK as required in the course of Consultant’s performance under
this Agreement. All Trade Secrets and/or Confidential Information coming
into
its possession shall remain the exclusive property of QUINTEK and shall
not be
copied and/or removed from the premises of QUINTEK under any circumstances
whatsoever without the prior written consent of QUINTEK, except in the
normal
course of Consultant’s performance under this Agreement. Under no circumstance
can such Trade Secrets and/or Confidential Information be allowed to fall
directly or indirectly into the hands of or be used by any competitor or
potential competitor of QUINTEK’s. To the extent that Consultant originates,
develops, or reduces to writing Trade Secrets and/or Confidential Information,
Consultant does so within the scope of its performance under this agreement.
QUINTEK possesses all right, title, and interest in all Confidential Information
and/or Trade Secrets, whether created by QUINTEK or Consultant.
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8.3 In
the
event of any termination of this Agreement, Consultant agrees to deliver
promptly to QUINTEK all files, records, documents, drawings, client or
candidate
lists, resumes, job descriptions, plans, proposals, contracts, charts,
other
lists and charts, equipment, books, notebooks, memoranda, reports,
correspondence, or other written, electronic or graphic records and the
like,
and all other Trade Secrets and/or Confidential Information relating to
QUINTEK’s business, which are or have been in his possession or under his
control, in good condition, ordinary wear and tear and damage by any cause
beyond the control of Consultant excepted.
8.4 Consultant
shall not, following the termination of this Agreement, either directly
or
indirectly, or by action in concert with others, either for Consultant’s own
benefit or for the benefit of any other person or entity:
8.4.1 Make
known to any person the names, addresses or telephone numbers or any of
the
candidates, clients or projects of QUINTEK or any other Trade Secrets and/or
Confidential Information pertaining to them;
8.4.2 For
a
period of twelve (12) months following the termination of this Agreement,
call
on, solicit, divert, interfere with or take away, or attempt to call on,
solicit, divert, interfere with or take away, any of the projects, clients
or
candidates of QUINTEK, including without limitation all those clients,
candidates and projects with whom Consultant became acquainted during his
employment with QUINTEK, either for Consultant’s own benefit or for any other
person or entity;
8.4.3 Induce
in
any way, directly or indirectly, QUINTEK’s employees, and/or persons working
with and/or contracting with QUINTEK, to disclose QUINTEK’s Trade Secrets and/or
Confidential Information to any person;
8.4.4 For
a
period of twelve (12) months following the termination of this Agreement,
hire
or take away, or attempt to hire or take away, any of QUINTEK’s employees,
and/or independent contractors, and/or persons working with and/or contracting
with QUINTEK; and
8.4.5 For
a
period of twelve (12) months following the termination of this Agreement,
induce
or influence (or seek to induce or influence) any person who is engaged
(as an
employee, agent, independent contractor, or otherwise) by QUINTEK to terminate
his or her employment or engagement or breach their duties of obligations
owed
to QUINTEK.
8.5 For
the
duration of this Agreement, Consultant shall not, directly or indirectly,
either
as an employee, employer, consultant, agent, principal, partner, stockholder,
corporate officer, director or in any other individual or representative
capacity, engage or participate in any business that is in competition
in any
manner whatsoever with the business of QUINTEK, without the prior written
consent of the Board. “Directly or indirectly” means that Consultant will not
benefit in any way, shape or form from any affiliation or consultation
with any
business that is engaged in film based imaging, custom application development,
staffing and permanent placements, whether or not he is an owner, director,
officer, shareholder, employee or consultant for such firm or entity.
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9. Entire
Agreement, Etc.
This
Agreement contains the entire and exclusive agreement of the parties hereto.
No
prior written or oral representations between them originating before the
date
of the Agreement not embodied herein shall be of any force or effect. The
parties have mutually participated in the negotiation and preparation of
this
Agreement and no rule of construction that the Agreement shall be construed
against the drafting party shall apply hereto.
10. Modification.
This
Agreement may not be superseded and none of the terms of this Agreement
can be
waived or modified except by an express written agreement signed by all
parties
hereto. Any oral representations or modifications concerning this Agreement
(including any fully executed oral agreements or modifications) shall be
of no
force or effect unless contained in a subsequent written modification signed
by
all parties.
11. Release
of Any Prior Bonus Claims.
As
further consideration for this Agreement, Consultant, on its own behalf
and on
behalf of its officers, managers, directors, partners, employees, predecessors,
successors, assigns, stockholders, representatives and agents, individually
and
collectively, hereby releases and discharges QUINTEK and its parents,
subsidiaries and affiliates, and each of their respective officers, managers,
directors, partners, employees, predecessors, successors, assigns, stockholders,
representatives and agents, individually and collectively, of and from
any and
all known or unknown liabilities, claims, demands or any other thing for
which
he or any of them have or may have a known or unknown cause of action,
claim, or
demand for damages, whether certain or speculative, which may have at any
time
prior hereto come into existence or which may be brought in the future
in
connection with obligations by QUINTEK to pay any bonus of any kind to
Consultant which have arisen at any time prior to the date of this
Agreement.
12. Severability.
If any
term, provision, covenant, or condition of this Agreement (the “Provision”) is
held by an arbitrator or a court of competent jurisdiction to be invalid,
void,
or unenforceable, the remaining provisions of this Agreement shall remain
in
full force and effect and in no way shall be affected, impaired, or invalidated.
If possible, the Provision shall remain in effect but shall be modified
by the
court only to the extent necessary to make it reasonable.
13. Arbitration.
Upon the
demand of either party, any dispute, controversy or claim arising out of
or
relating to this Agreement, or the breach, termination or invalidity thereof,
or
that arises out of the relationship of the parties shall be resolved by
mandatory binding arbitration in Huntington Beach, California. If despite
demand, an action is commenced or prosecuted in any court, the party demanding
arbitration may bring any action in any court of competent jurisdiction
to
compel arbitration of such matters. Any party who fails or refuses to submit
to
binding arbitration following lawful demand shall bear all costs and expenses
incurred by the opposing party in compelling arbitration of such matter.
All
matters submitted to arbitration shall be resolved by binding arbitration
administered by the American Arbitration Association (herein referred to
as
“AAA”), in Huntington Beach, California, in accordance with the Commercial
Arbitration Rules of the AAA, the Federal Arbitration Act (Title 9 of the
United
States Code), and, to the extent that the foregoing are inapplicable,
unenforceable, or invalid, the laws of Orange County, the State of California.
Any arbitrator selected must be a practicing attorney, a member of the
State Bar
of California, and must be experienced and knowledgeable in the substantive
laws
applicable to the dispute in question. The substantive laws of Orange County,
the State of California shall govern any such arbitration. The parties
will
agree to a single arbitrator to resolve their dispute or AAA shall appoint
an
independent, third party neutral within 30 days of being requested by either
party to decide all matters. The parties expressly agree to waive any and
all
appeal or other legal rights with respect to any decision reached by arbitration
hereunder
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14. Choice
of Law.
This
Agreement shall be governed by and interpreted with the laws of the State
of
California.
15. Waiver.
The
failure of either party to insist on strict compliance with any of the
terms of
this Agreement shall not be deemed a waiver of that term or of that party’s
right to subsequently enforce that term.
16. Attorneys’
Fees.
The
parties hereto agree to bear their own costs and attorneys’ fees incurred in the
negotiation and drafting of this Agreement or otherwise incurred prior
to the
date of execution hereof.
17. Notice.
Any
notices, requests, demands, or other communications with respect to this
Agreement shall be in writing and shall be (i) personally delivered, (ii)
sent
by facsimile transmission, (iii) sent by the United States Postal Service,
registered or certified mail, return receipt requested, or (iv) delivered
by a
nationally recognized express overnight courier service, charges prepaid,
to the
addresses set forth below except that any communications from Executive
to
QUINTEK shall also be sent to ________________________________________
(such
addresses to be changed by parties as they may specify from time to time
in
accordance with this Section). Any such notice shall, when sent in accordance
with the preceding sentence, be deemed to have been given and received
on the
earliest of (i) the day delivered to such address, (ii) the day sent by
facsimile transmission, (iii) the third business day following the date
deposited with the United States Postal Service, or (iv) 24 hours after
shipment
by such courier service.
18. Binding
Effect and Assignment.
This
Agreement shall be binding upon the parties hereto, their heirs, personal
representatives and successors and assigns. This Agreement may not be assigned
by either party without first obtaining the written consent of the other
party.
19. References.
For
purposes of this agreement, references to Consultant shall be deemed to
include
Executive and references to Executive shall be deemed to include
Consultant.
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IN
WITNESS WHEREOF,
the
parties hereto have executed this Agreement as of the date first above
written.
| QUINTEK TECHNOLOGIES, INC. | ||
| |
|
|
| By: | /s/ Xxxxxx Xxxxxx | |
| Its: | Chairman & CEO | |
| XXXXXX CONSULTING, INC. | ||
| |
|
|
| By: | /s/ XXXXX XXXXXX | |
| Its: | CEO | |
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