CONSULTING AGREEMENT
Exhibit 10.2
This Consulting Agreement (“Agreement”), dated this 1st day of October, 2007, is by and
between Hypercom U.S.A., Inc., located at 0000 Xxxx Xxxxxxxx Xxxx, Xxxxxxx, Xxxxxxx 00000
(“Hypercom”) and Xxxx X. Xxxx (“Consultant”) whereby Hypercom hereby retains Consultant to furnish
services pursuant to the terms and conditions set forth below.
1. Term. This Agreement shall be effective as of the date first written above and shall
continue in effect through December 31, 2007 or, as mutually agreed by the parties, for duration of
any relevant statement of work (“SOW”) issued by Hypercom that is hereby incorporated by reference
and made an integral part of this Agreement (“Term”).
2. Services. Consultant hereby agrees to perform the services described herein or in the
relevant SOW issued by Hypercom (“Services”). All Services shall be performed to Hypercom’s
satisfaction. In the event any Services are not performed to Hypercom’s reasonable satisfaction,
Consultant agrees to promptly re-perform the unsatisfactory Services at no additional cost to
Hypercom. All Services must be performed by Consultant, without the right to use subcontractors or
any other third party without the prior written consent of Hypercom. In the event Hypercom
consents, in its sole and absolute discretion, to the use of any person or entity to assist
Consultant with Services: (a) such person or entity shall agree to be bound by the terms of
Hypercom’s standard non-disclosure agreement prior to the performance of any Services; and (b)
Consultant will remove and/or replace any such person or entity immediately upon Hypercom’s request
for any reason whatsoever. Consultant shall perform all Services under the supervision of and
shall report directly to the following “Project Supervisor(s)”: Xxx Xxxxxxx and Xxxxxxxx
Xxxxxxxxx.
3. Invoices and Fees. The fees are described in the relevant SOW (“Fees”). Consultant
agrees to deliver an invoice to the Project Supervisor within ten (10) days after the last day of
each month during the Term or as otherwise directed by the Project Supervisor. Each invoice must
contain a description of: (a) the Fees earned; (b) the hours worked during the relevant monthly
period; (c) Services performed, including a progress report and the percent of completion (if
applicable); and (d) any travel and related expenses for which reimbursement is permitted
hereunder. Hypercom shall pay Consultant within thirty (30) days of receiving a correct and
undisputed invoice from Consultant for Services performed during the preceding month. In addition
to the Fees, Hypercom will reimburse Consultant for any pre-approved travel and related expenses
that comply with Hypercom’s standard corporate policies. All taxes, dues, fees, duties and charges
imposed on Consultant in connection with the Services and the compensation therefor shall be borne
by Consultant, and all payments are subject to applicable withholding requirements. Further, as of
the date first written above, Hypercom will pay for three (3) months of COBRA health coverage for
Consultant.
4. Independent Contractor Status. It is expressly agreed and understood that Consultant
will be performing Services under this Agreement as an independent contractor for Hypercom.
Nothing contained herein shall be construed as creating any agency, employment relationship,
partnership, principal-agent or other form of joint enterprise between the parties. Consultant
shall not represent it, its employees, representatives, or subcontractors as agents, employees,
partners or joint venturers of Hypercom, and may not obligate Hypercom or otherwise cause Hypercom
to be liable under any contract or agreement express or implied.
5. Limitation of Liability. Hypercom’s entire aggregate liability hereunder shall be
limited to payment to Consultant of the Fees paid pursuant to this Agreement. All liability to any
other person providing Services under this Agreement or related to providing such Services,
including but not limited to, payment of wages or other compensation, withholding and payment of
taxes and similar charges related to such wages or other compensation, and Worker’s Compensation,
shall be Consultant’s sole responsibility. The foregoing sentence shall not imply the right for
Consultant to use any other person or entity in the performance of Services. IN NO
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EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR ANY LOSS OF USE, INTERRUPTION OF
BUSINESS, OR ANY INDIRECT, SPECIAL, INCIDENTAL, EXEMPLARY, OR CONSEQUENTIAL DAMAGES OF ANY KIND
(INCLUDING LOST PROFITS) REGARDLESS OF THE FORM OF ACTION WHETHER IN CONTRACT, TORT, (INCLUDING
NEGLIGENCE), STRICT PRODUCT LIABILITY, OR OTHERWISE, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES.
6. Indemnification. Consultant shall assume liability for any losses and damages suffered
by Hypercom arising out of or related to Services, and will defend and hold Hypercom harmless from
any claims or demands that may be asserted against Hypercom except to the extent that such claim,
loss, or damage was caused by the gross negligence or willful misconduct of Hypercom, its agents or
employees.
7. Assignment of Developments. In consideration of Consultant’s work in any capacity for
Hypercom and of the Fees paid for such Services, the parties agree as follows:
a. Consultant will promptly and fully communicate to Hypercom all inventions, discoveries,
concepts, and ideas whether or not patentable or copyrightable, including but not limited to,
hardware and apparatus, processes and methods, formulas, designs, computer programs and techniques,
as well as improvements thereof and knowledge related thereto, (hereinafter collectively referred
to as “Developments”) conceived or completed, or reduced to practice (whether solely by Consultant
or jointly with others) during the term of the Agreement and within one (1) year after the end of
its association with Hypercom that: (i) are related to work Consultant performs with regard to the
present or prospective business, work, research, developments or investigations of Hypercom; (ii)
result from any work Consultant performs with the use of any equipment, facilities, materials or
personnel of Hypercom; (iii) result from or are suggested or inspired by any work that Consultant
may do for or on behalf of Hypercom; or (iv) result directly from Consultant’s access to any of
Hypercom’s memoranda, notes, records, drawings, sketches, models, customer lists, research or
laboratory results, data, formulae, specifications, inventions, processes, equipment or the like
(collectively referred to as “Hypercom Materials”).
b. Consultant will assign, and does hereby assign, to Hypercom or Hypercom’s designee, Consultant’s
entire right, title and interest to all such Developments and all copyrights, trade secrets rights
and mask work rights in such Developments and any patent applications filed and patents granted
thereon including, but not limited to, those in foreign countries and, both during Consultant’s
work with Hypercom and thereafter, to execute any patent papers covering such Developments as well
as any papers that Hypercom may consider necessary or helpful in obtaining or maintaining
Hypercom’s ownership rights in said Developments in order to secure for Hypercom patent, copyright
or other protection.
c. Consultant shall retain all right, title and interest, in and to any various pre-existing
development tools, routines, subroutines, libraries, algorithms, software engines, source code,
object code, and other programs, data and materials, and any modifications, enhancements or
derivative works thereto, and all applicable intellectual property rights therein, including
without limitation, copyrights, patents, trade secrets, trademarks and moral rights, used by
Consultant in performing the Services and portions of which may be incorporated into the
Developments (“Background Technology”). Consultant agrees to list any Background Technology and any
applicable third-party licenses to be used for any Services in an applicable SOW or Exhibit. To
the extent it lawfully may, Consultant hereby grants to Hypercom a nonexclusive, perpetual,
irrevocable, worldwide, fully paid license, with the right to sublicense, to make, have made, sell,
offer to sell, import, use, modify, create derivative works, perform, display, execute, distribute
(including through multiple tiers) and reproduce the Background Technology solely as incorporated
into the Developments.
8. Assignment of Copyright Materials. All original materials Consultant may develop
(alone or jointly with others) under this Agreement, including but not limited to, computer
programs, listings, design specifications, flow charts and documentation are to be considered
“works made for hire” under the United States copyright laws and are the sole and exclusive
property of Hypercom. In the event any of the developed materials are determined by a court of
competent jurisdiction not to be “works made for hire” under the United States copyright laws, this
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Agreement shall operate as an irrevocable assignment by Consultant to Hypercom of the copyright in
the developed materials including all rights thereunder.
9. Conflicts. Consultant acknowledges that there are no currently existing ideas,
processes, inventions, discoveries, marketing or business ideas or improvements that Consultant
desires to exclude from the operation of this Agreement except as set forth in Exhibit A attached
hereto. The absence of an Exhibit A herefrom constitutes Consultant’s representation that no such
exclusions exist. To the best of Consultant’s knowledge, there is no other contract to assign
inventions, trademarks or service marks, ideas, processes, or discoveries that is now in existence
between Consultant and any other person (including any business or governmental entity) except as
set forth in Exhibit B attached hereto. The absence of an Exhibit B herefrom constitutes
Consultant’s representation that no such contracts or obligations exist.
10. Confidentiality Obligations of Consultant. Consultant acknowledges that in rendering
Services to Hypercom, Consultant will receive information that Hypercom regards as confidential
(“Confidential Information”). Confidential Information incorporates information or material that
is not generally available to or used by others, or the utility or value of which is not generally
known or recognized as standard practice, whether or not the underlying details are in the public
domain, including: (a) information or material that relates to inventions, technological
developments, “know-how,” purchasing, accounting, merchandising, or licensing; (b) trade secrets as
defined in the Restatement of Torts; (c) software in various stages of development (source code,
object code, documentation, diagrams, flow charts), designs, drawings, specifications, models,
data, and customer information; and (d) any information of the type described above that Hypercom
treats as proprietary or designates as confidential, whether or not owned or developed by Hypercom.
Consultant agrees to receive and hold Confidential Information and information relating to
Hypercom rights in Developments in confidence (whether or not conceived, originated, discovered or
developed in whole or part by Consultant) and with no less than a commercially reasonable degree of
care, to not disclose Confidential Information to any person or entity not a party to this
Agreement, and to not use any Confidential Information for the benefit of Consultant or any third
party. Consultant agrees to pay any and all damages (including attorney’s fees) sustained by
Hypercom due to the unauthorized disclosure or use of any Confidential Information or information
relating to Hypercom rights in Developments by Consultant. Consultant’s obligations under this
Section 10 shall continue with respect to each item of Confidential Information and each item of
information relating to Hypercom rights in Developments until Hypercom publishes said item or until
said item becomes public and acknowledged by Hypercom by a means other than a breach of this
Agreement by Consultant. This Section is not intended to replace or supersede any non-disclosure
or confidentiality agreement between Hypercom and Consultant concerning treatment of confidential
information, but rather, is intended to be an addition or supplement to any such agreement that may
already exist between the parties.
11. Non-Solicitation. To protect Hypercom rights in Confidential Information and any
other proprietary property of Hypercom, Consultant agrees not to directly or indirectly encourage
nor seek to influence any employee of Hypercom to quit or leave Hypercom’s employment nor to
commence employment with Consultant or any third party during the Term and for an additional three
(3) years following termination or expiration thereof.
12. Equitable Relief. Consultant hereby acknowledges that a breach by Consultant of any
of the provisions of this Agreement relating to Confidential Information, Hypercom proprietary
information, or non-solicitation will cause Hypercom irreparable injury and damage for which
remedies at law would be inadequate. Therefore, Consultant hereby agrees that Hypercom shall be
entitled to seek injunctive and/or other equitable relief to prevent a breach or threatened breach
of this Agreement, or any part of it, and to secure its performance.
13. Termination.
a. This Agreement may be terminated: (i) immediately upon any attempt by Consultant to assign,
delegate, sublicense, or otherwise transfer this Agreement or its rights, except as provided for
herein; (ii) immediately upon any breach by Consultant of any confidentiality or proprietary
information provisions of this Agreement, including but not limited to, Consultant’s attempt to
reverse engineer, decompile, disassemble, decrypt, modify or make
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unauthorized copies of any Hypercom intellectual property; (iii) upon seven (7) days prior written
notice for Consultant’s failure to perform the Services in a satisfactory manner, in Hypercom’s
sole and absolute discretion; or (iv) immediately if Consultant terminates or suspends its
business, files a petition for bankruptcy or is subject to an involuntary insolvency proceeding,
makes an assignment for the benefit of its creditors, or a trustee, receiver or similar authority
is appointed for Consultant’s business or to take control of a majority of Consultant’s assets.
All SOWs will terminate immediately upon termination of this Agreement.
b. Upon termination or expiration of this Agreement, Consultant shall promptly: (i) furnish to
Hypercom a report summarizing the Services completed and the status of any work in progress; and
(ii) comply with any provisions of this Agreement regarding the return of Confidential Information,
Developments, and Hypercom Materials. Upon Consultant’s full compliance with (b)(i) and (b)(ii)
above, Consultant shall be paid for all Services rendered up until and related Fees owed as of the
effective date of termination, in accordance with this Agreement.
14. Return of Materials. Consultant shall deliver to Hypercom promptly upon request, or
on the date of termination of work, any and all records, documents, copies thereof and any other
Hypercom Materials in Consultant’s possession pertaining to Hypercom’s business, including, but not
limited to, equipment, Confidential Information or Developments. Consultant shall continue
thereafter to promptly return to Hypercom any of the above mentioned materials and all copies
thereof pertaining to Hypercom’s business or originating with Hypercom that come into Consultant’s
possession.
15. Improper Payments. Consultant represents and warrants that it has not agreed to, nor
will it, make any offer, payment, promise to pay or authorization of the payment of any money, or
any offer, gift, promise to give, or authorization of the giving of anything of value, to any (a)
to any director, officer, employee, agent or other representative of the Company in connection with
this Agreement, nor has any such payment or agreement for payment been requested or solicited by
any such director, officer, employee, agent or other representative; or (b) official, any political
party or official thereof or any candidate for political office, or any other person to influence
or reward action or inaction respecting this Agreement or to seek an improper advantage (“Improper
Payments”). Consultant further represents and warrants its employees, agents or authorized
representatives have not made any such Improper Payments. Consultant hereby acknowledges that it
understands that any Improper Payments would violate the Company’s firm and undeviating policy, and
that this representation and warranty constitutes a material inducement upon which the Company is
relying in entering into and performing this Agreement.
16. Representation and Warranties.
a. Quality of Services. Consultant represents and warrants that the Services shall at all
times: (i) be of merchantable quality, of good material and workmanship, and free of defect in
design, material, or workmanship (and with respect to services, performed in a professional and
workmanlike manner); (ii) conform in all respects to the warranties set forth in this Agreement;
and (iii) be fit for the purposes for which Services of that type are ordinarily used. In the
event that Consultant is in breach of the warranties in this Section, it shall, within ten (10)
business days after Hypercom’s notice of breach: (A) redeliver or re-perform the Services or the
non-conforming items, at Consultant’s own expense: or (B) if (A) is not practicable as determined
by the parties in their reasonable discretion, refund the entire purchase price, plus shipping and
other charges.
b. No Liens. Consultant warrants that it has the right, title, and interest to convey the
Services, and that the Services are free of all liens, charges, encumbrances, or claims of any
person. If at any time Consultant shall incur any indebtedness that has become a lien upon the
Services or any part thereof or that may become a claim against Hypercom, or in the event a claim
is asserted against Hypercom alleging that the Services are infringing, Consultant shall
immediately pay such claim or indebtedness or cause such lien to be released and discharged by
posting a bond or otherwise at its expense and indemnify Hypercom against any damages or expenses.
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c. Requisite Authority. Both parties have the necessary authority to enter into this
Agreement and is not subject to any agreement or other constraint that would prohibit or restrict
the other party’s right or ability to enter into, or carry out, its obligations hereunder.
d. Subcontractors. Consultant will be responsible for the acts and omissions of Consultant
and its employees as well as only those agents and subcontractors employed or contracted by
Consultant who are directly involved in the support of the Services to Hypercom.
e. Time is of the Essence. Time is of the essence in connection with consultant’s
performance and delivery of the Services and other deliverables and such performance will be made
in accordance with any applicable performance delivery schedules in a SOW.
f. Third-Party Rights. Consultant’s performance of the Services does not violate any
third-party rights in any patent, trademark, copyright, trade secret, or similar intellectual
property right.
17. General Provisions.
a. Entire Agreement. Any SOW or Exhibit(s) attached hereto, along with any applicable
non-disclosure agreement, are hereby incorporated into and form a part of this Agreement. This
Agreement constitutes the entire agreement between Hypercom and Consultant with respect to the
subject matter of this Agreement, superseding all drafts, all prior or contemporaneous agreements,
and all promises or representations, written or oral. To the extent the terms and conditions of
this Agreement conflict with the terms and conditions of an applicable SOW or Exhibit, the terms
and conditions of this Agreement shall control. Each party agrees that use of pre-printed forms,
such as invoices, purchase orders or acknowledgements, is for convenience only and all terms and
conditions stated thereon are void and of no effect. In a legal action brought to enforce or
interpret this Agreement, the prevailing party shall be entitled to recover from the other all
costs and reasonable attorneys’ fees so incurred. Those provisions of this Agreement that, by
their nature, are meant to survive any termination of this Agreement will so survive.
Notwithstanding the foregoing, the Consultant acknowledges and agrees that this Agreement does not,
under any circumstances, amend, modify or otherwise act as a waiver of any Consultant obligations
as a former Hypercom employee or of any agreements Consultant executed with Hypercom associated
with such employment or termination thereof. Further, Consultant acknowledges and agrees that
Hypercom has entered into this Agreement in consideration of Consultant’s waiver and release of any
and all claims of any kind Consultant may have as a result of Consultant’s employment with
Hypercom.
b. Captions. The section captions in this Agreement are for convenience of reference only,
and shall not affect the interpretation of the body of the contract.
c. Modification. This Agreement may be modified only by written instrument signed by an
authorized representative of the party against which enforcement is sought, that makes reference to
the specific section it purports to amend. Any party’s standard form that purports to govern
acquisition of Services ordered pursuant to this Agreement shall be ineffective to modify this
Agreement and shall not be binding upon either party to the extent it is inconsistent with this
Agreement.
d. Waiver. The non-enforcement of any provision of this Agreement, or failure to insist on
strict compliance with any of the terms, covenants or conditions hereof, shall not be deemed a
waiver of any right granted under this Agreement; nor shall any waiver of any right granted
hereunder on one occasion be deemed a waiver at any other time.
e. Severability. In the event that any clause of this Agreement is found by a court
validly asserting jurisdiction to be unenforceable, that clause will be considered void to the
extent it is contrary to the applicable law, but such a finding shall not affect the validity of
any other clause of the Agreement, and the rest of the Agreement shall remain in full force and
effect.
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f. Governing Law. This Agreement shall be governed by the laws of the State of
Arizona without regards to its conflicts of laws principles. Notwithstanding the preceding
sentence, Hypercom may bring an action in any jurisdiction or forum provided such action is solely
to enjoin the actual or anticipated wrongful disclosure of any Confidential Information, and the
jurisdiction and forum is that in which the wrongful disclosure has or is anticipated to occur.
g. Third-Party Beneficiaries. This Agreement inures to the benefit of Hypercom’s
affiliates, subsidiaries, and successors-in-interest, all of which shall have the right to issue
SOWs and receive Services under the same terms and conditions as Hypercom; submission of an SOW
referring to this Agreement shall constitute a binding agreement by such Hypercom affiliate.
h. Notices. Every notice required or contemplated by this Agreement shall be in
writing. Notices shall be deemed received (i) when delivered personally; (ii) when sent by
confirmed facsimile (followed by the actual document in air mail/air courier); or (iii) one (1)
business day after deposit with a commercial express courier specifying next day delivery (or, for
international courier packages, two (2) business days after deposit with a commercial express
courier specifying two-day delivery) with written verification of receipt. All notices will be
sent to the addresses set forth in this Agreement or to such other address as may be designated by
written notice.
i. Notice of Labor Disputes. Whenever an actual or potential labor dispute is delaying or
threatens to delay any timely performance of a SOW, Consultant shall immediately give notice
thereof to Hypercom. Such notice shall include all relevant information with respect to such
dispute.
j. Records and Audit. For any Services purchased under this Agreement, Consultant
shall maintain complete and accurate books and records of the amounts charged to Hypercom in
connection with such items. Consultant shall retain such records for two (2) years after delivery
of such items and shall make such records available to Hypercom or its third-party auditor, during
normal business hours upon reasonable advance written notice.
k. Execution by Counterparts. This Agreement may be executed by facsimile and in one
or more counterparts, each of which shall be deemed an original and all of which shall constitute
one and the same Agreement.
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IN WITNESS WHEREOF, the parties duly authorized representatives have executed this Agreement as of
the date first written above.
| Xxxx X. Xxxx | Hypercom U.S.A., Inc. | |||||||||
By:
|
/s/ Xxxx X. Xxxx
|
By: | /s/ Xxxxxxx Xxxxxx
|
|||||||
| Name: Xxxxxxx Xxxxxx | ||||||||||
| Title: CEO | ||||||||||
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