Exhibit 10.14
BUSINESS DEVELOPMENT AGREEMENT
This BUSINESS DEVELOPMENT AGREEMENT ("Agreement") is made and entered
into this 18th day of February 2005 by and between X. Xxxxx Holdings, Inc.
(the "Business Developer") and Innova Holdings, Inc., a Delaware corporation
(the "Company").
R E C I T A L S:
A. Company is in the primary business of developing, marketing and
selling software products for use in the operation of industrial and
service (non industrial) robot arms and automated systems. The
Company also designs and sells computer hardware necessary to
operate the software.
B. Business Developer has certain Sales and Marketing experience in the
industrial, entertainment and consumer market that the Company
believes to be valuable to it.
C The Company desires to retain the Business Developer and the
Business Developer desires to accept such engagement.
NOW THEREFORE, in consideration of the promises, mutual covenants and
agreements contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and the
Business Developer do hereby agree as follows:
1. Scope of Engagement. On the terms and subject to the conditions set
forth in this Agreement, the Company agrees to retain the Business Developer to
perform such business development activities as are consistent with such
engagement and as may be assigned, from time to time, by the Company and to
render such additional services and supporting services as the Company may, from
time to time, stipulate. The Business Developer will report to the Chief
Executive Officer (CEO) of the Company.
2. Performance. The Business Developer accepts the engagement described in
Section 1 of this Agreement and agrees to devote all of Business Developer's
business time and efforts except as specifically permitted herein to the
faithful and diligent performance of the services described herein, including
the performance of such other services and responsibilities as the Company may,
from time to time, stipulate. Time associated with X. Xxxxx Holdings, Inc.
activities in place at the time of this agreement is approved, but all
additional outside interest activities from the time of this agreement will be
submitted for approval of the CEO. Without limiting the generality of the
foregoing, the Business Developer ordinarily shall devote not less than forty
(40) hours per week to the business development activities described in Section
1 of this Agreement.
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3. Term. The term of engagement under this Agreement is effective as of
January 15, 2005 (the "Commencement Date") and shall remain in effect for a
period of five (5) years ending on January 14, 2010 (the "Termination Date")
(and each subsequent one year anniversary, if extended, as provided herein shall
also be referred to herein as a Termination Date) unless sooner terminated
hereunder (the "Engagement Period"). This Agreement shall be automatically
extended each year for an additional one (1) year period unless terminated by
either party by giving written notice to the other no less than thirty (30) days
prior to the Termination Date.
4. Engagement Fee. For all the services to be rendered by the Business
Developer hereunder, the Company agrees to pay an initial one time fee of
6,000,000 shares of common stock of the Company. Additionally, a monthly
engagement fee at a rate of Ten Thousand Dollars ($10,000) per month ("Fee"),
payable by the Company in accordance with its vendor payable practices from time
to time but no less frequently than monthly, provided the Objectives set forth
on Exhibit A are achieved. The Company shall have the option to pay the Fee in
cash or in S-8 shares of common stock of the Company, but will not have
exclusive use of the Business Developer's time until the payment of the monthly
Fee is in cash. For all services performed in January the stock price used for
conversion of cash Fee into S-8 shares of common stock shall be $.005.
Thereafter, the stock price shall be determined by the closing bid price for a
single share of the Company's stock on the 15th day of the month (or closest
business day) in which the Fee is earned. All compensation from the company to
the Business Developer will be addressed to X. Xxxxx Holdings, Inc., a Florida
corporation.
5. Commission. During the Engagement Period, the Business Developer shall
have the opportunity to earn an annual commission paid monthly upon the
Company's purchase order acceptance and final payments received from the
customer. The commission shall be based on the achievement of certain sales
objectives of the Company and its subsidiaries. Such sales objectives will be
established by the CEO of the Company. The commission earned will be as
stipulated in accordance with the "Commission Schedule" attached as Exhibit B.
6. Stock Options. In further consideration of Business Developers
engagement and for entering this Agreement, the Company agrees to grant to
Business Developer an option to acquire that number of shares of Company common
stock that equals 1% of the outstanding common stock (calculated on a fully
dilutive basis) on the date hereof at a $.01 per share purchase price. The
shares covered by such stock options shall vest equally over a sixty (60) month
period starting on January 15, 2005 and each month thereafter until fully
vested, such that 1/60th of the stock options shall vest at the end of each
month during the first five (5) years of the engagement period.
7. Reimbursement of Expenses. The Company shall reimburse Business
Developer for all required expenses necessary to fulfill the activities referred
to in Section 1 of the Agreement, provided all such expenses are pre-approved by
the CEO.
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8. Surrender of Properties. Upon termination of the Business Developer's
engagement with the Company, regardless of the cause therefor, the Business
Developer shall promptly surrender to the Company all property provided him/her
by the Company for use in relation to his engagement, and, in addition, the
Business Developer shall surrender to the Company any and all financial and tax
records, accounting work papers, correspondence relating to SEC or legal matter,
any other materials related to financial or SEC matters, sales materials, lists
of customers and prospective customers, price lists, files, patent applications,
records, models, software files, listings, copies of Windows(R) software, or
other materials and information of or pertaining to the Company or its customers
or prospective customers or the products, business, and operations of the
Company.
9. Inventions and Secrecy. Except as otherwise provided in this Section 9,
the Business Developer: (a) shall hold in a fiduciary capacity for the benefit
of the Company all secret or confidential information, knowledge, or data of the
Company or its business operations obtained by the Business Developer during his
engagement by the Company, which shall not be generally known to the public or
recognized as standard practice (whether or not developed by the Business
Developer) and shall not, during his engagement by the Company and after the
termination of such engagement for any reason, communicate or divulge any such
information, knowledge or data to any person, firm or corporation other than the
Company or persons, firms or corporations designated by the Company; (b) shall
promptly disclose to the Company all inventions, ideas, devices, and processes
made or conceived by him/her alone or jointly with others, from the time of
entering the Company's engagement until such engagement is terminated and within
the six (6) month period immediately following such termination, relevant or
pertinent in any way, whether directly or indirectly, to the Company's business
or production operations or resulting from or suggested by any work which he may
have done for the Company or at its request; (c) shall, at all times during his
engagement with the Company, assist the Company in every proper way (entirely at
the Company's expense) to obtain and develop for the Company's benefit patents
or copyrights on such inventions, ideas, devices and processes including without
limitation software and software files and listings to be used with industrial
automation, industrial robots and service (non industrial) robots, whether or
not patented; and (d) shall do all such acts and execute, acknowledge and
deliver all such instruments as may be necessary or desirable in the opinion of
the Company to vest in the Company the entire interest in such inventions,
ideas, devices, and processes referred to above. The foregoing to the contrary
notwithstanding, the Business Developer shall not be required to assign or offer
to assign to the Company any of the Business Developer's rights in any invention
for which no equipment, supplies, facility, or trade secret information of the
Company was used and which was developed entirely on the Business Developer's
own time, unless (a) the invention related to (i) the business of the Company or
(ii) the Company's actual or demonstrably anticipated research or development,
or (b) the invention results from any work performed by the Business Developer
for the Company. The Business Developer acknowledges his prior receipt of
written notification of the limitation set forth in the preceding sentence on
the Business Developer's obligation to assign or offer to assign to the Company
the Business Developer's rights in inventions.
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10. Confidentiality of Information; Duty of Non-Disclosure.
(a) The Business Developer acknowledges and agrees that his
engagement by the Company under this Agreement necessarily involves his
understanding of and access to certain trade secrets and confidential
information pertaining to the business of the Company. Accordingly, the Business
Developer agrees that after the date of this Agreement at all times he will not,
directly or indirectly, without the express written consent of the Company,
disclose to or use for the benefit of any person, corporation or other entity,
or for himself any and all files, trade secrets or other confidential
information concerning the internal affairs of the Company, including, but not
limited to, information pertaining to its trade secrets, business plans,
clients, prospects, services, products, earnings, finances, operations, methods
or other activities, provided, however, that the foregoing shall not apply to
information which is of public record or is generally known, disclosed or
available to the general public or the industry generally. Further, the Business
Developer agrees that he shall not, directly or indirectly, remove or retain,
without the express prior written consent of the Company, and upon termination
of this Agreement for any reason shall return to the Company, any figures,
calculations, letters, papers, records, computer disks, computer print-outs,
lists, documents, instruments, drawings, designs, programs, brochures, sales
literature, business plans or any copies thereof, or any information or
instruments derived therefrom, or any other similar information of any type or
description, however such information might be obtained or recorded, arising out
of or in any way relating to the business of the Company or obtained as a result
of his engagement by the Company except as disseminated to the public at large
or industry generally. The Business Developer acknowledges that all of the
foregoing are proprietary information, and are the exclusive property of the
Company. The covenants contained in this Section 10 shall survive the
termination of this Agreement.
(b) The Business Developer agrees and acknowledges that the Company
does not have any adequate remedy at law for the breach or threatened breach by
the Business Developer of his covenant, and agrees that the Company shall be
entitled to injunctive relief to bar the Business Developer from such breach or
threatened breach in addition to any other remedies which may be available to
the Company at law or in equity.
(c) The Company may not include the name or likeness of the Business
Developer in any press announcements, marketing materials, websites, or any
information release of any kind.
11. Covenant Not to Compete.
(a) During Engagement Period. During the Engagement Period, the
Business Developer shall not, without the prior written consent of the Company,
which consent may be withheld at the sole discretion of the Company, engage in
any other business activity for gain, profit, or other pecuniary advantage
(excepting the investment of funds in such form or manner as will not require
any services on the part of the Business Developer in the operation of the
affairs of the companies in which such investments are made) or engage in or in
any manner be connected or concerned, directly or indirectly, whether as an
officer, director, stockholder, partner, owner, employee, creditor, or
otherwise, with the operation, management, or conduct of any business that
competes with or is of a nature similar to that of the Company.
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(b) Following Termination of Engagement Period. Within the one (1)
year period immediately following the later of the end of the Engagement Period
or termination of the Business Developer's engagement with the Company, for any
reason except as set forth below, the Business Developer shall not, without the
prior written consent of the Company, which consent may be withheld at the sole
discretion of the Company: (a) engage in or in any manner be connected or
concerned, directly or indirectly, whether as an officer, director, stockholder,
partner, owner, employee, creditor, or otherwise with the operation, management,
or conduct of any business similar to the business of the Company being
conducted at the time of such termination anywhere in the United States, and any
other area in which the Company is, or reasonably contemplating, doing business
at the time of such termination; (b) solicit, contact, interfere with, or divert
any customer served by the Company, or any prospective customer identified by or
on behalf of the Company, during the Business Developer's engagement with the
Company; or (c) solicit any person then or previously employed by the Company to
join the Business Developer, whether as a partner, agent, employee or otherwise,
in any enterprise engaged in a business similar to the business of the Company
being conducted at the time of such termination. For purposes of this Agreement,
the business is deemed to be the development and maintenance of computer
software, controls, and hardware electronics for use in robotics, manufacturing,
automation and service industries and that all such software and hardware is
owned and shall be exclusively owned by the Company.
(c) Severability. The covenants of the Business Developer contained
in Sections 9,10, and 11 of this Agreement shall each be construed as an
agreement independent of any other provision in this Agreement, and the
existence of any claim or cause of action of the Business Developer against the
Company, whether predicated on this Agreement or otherwise, shall not constitute
a defense to the enforcement by the Company of such covenants. Both parties
hereby expressly agree and contract that it is not the intention of either party
to violate any public policy, or statutory or common law, and that if any
sentence, paragraph, clause, or combination of the same of this Agreement is in
violation of the law, such sentence, paragraph, clause or combination of the
same shall be void, and the remainder of such paragraph and this Agreement shall
remain binding on the parties to make the covenants of this Agreement binding
only to the extent that it may be lawfully done. In the event that any part of
any covenant of this Agreement is determined by a court of law to be overly
broad thereby making the covenant unenforceable, the parties hereto agree, and
it is their desire, that such court shall substitute a judicially enforceable
limitation in its place, and that as so modified the covenant shall be binding
upon the parties as if originally set forth herein.
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12. Termination.
(a) Termination for Just Cause. The Company shall have the option to
terminate the Engagement Period, effective immediately upon written notice of
such termination to the Business Developer, for Just Cause. For purposes of this
Agreement, the term "Just Cause" shall mean the occurrence of any one or more of
the following events: (a) the death or permanent total disability of the
Business Developer or his absence from engagement by reason of illness or
incapacity for a period of sixty (60) consecutive days; (b) the breach by the
Business Developer of his covenants under this Agreement; (c) the commission by
the Business Developer of theft or embezzlement of Company property or other
acts of dishonesty; (d) the commission by the Business Developer of a crime
resulting in injury to the business, property or reputation of the Company or
any affiliate of the Company or commission of other significant activities
harmful to the business or reputation of the Company or any affiliate of the
Company; (e) the commission of an act by the Business Developer in the
performance of his duties hereunder determined by the Board of Directors of the
Company to amount to gross, willful, or wanton negligence; (f) the willful
refusal to perform or substantial neglect of the duties assigned to the Business
Developer pursuant to Section 1 hereof; (g) any significant violation of any
statutory or common law duty of loyalty to the Company; (h) termination of the
business of the Company for any reason or (i) other legally sufficient cause.
Upon termination of engagement, the Business Developer shall have no
rights to compensation or severance for any period beyond the effective date of
termination.
13. General Provisions.
(a) Goodwill. The Company has invested substantial time and money in
the development of its products and services, soliciting clients and creating
goodwill. By accepting the engagement with the Company, the Business Developer
acknowledges that the customers are the customers of the Company, and that any
goodwill created by the Business Developer belongs to and shall inure to the
benefit of the Company.
(b) Notices. Any notice required or permitted hereunder shall be
made in writing (i) either by actual delivery of the notice into the hands of
the party thereunder entitled, or (ii) by the mailing of the notice in the
United States mail, certified or registered mail, return receipt requested, all
postage prepaid and addressed to the party to whom the notice is to be given at
the party's respective address as set forth in the records of the Company.
The notice shall be deemed to be received in case (i) on the date of its actual
receipt by the party entitled thereto and in case (ii) on the date which is
three (3) days after its mailing.
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(c) Amendment and Waiver. No amendment or modification of this
Agreement shall be valid or binding upon the Company unless made in writing and
signed by an officer of the Company duly authorized by the Board of Directors or
upon the Business Developer unless made in writing and signed by him. The waiver
by the Company of the breach of any provision of this Agreement by the Business
Developer shall not operate or be construed as a waiver of any subsequent breach
by him.
(d) Entire Agreement. This Agreement constitutes the entire
agreement between the parties with respect to the Business Developer's duties
and compensation as a Business Developer for the Company, and there are no
representations, warranties, agreements or commitments between the parties
hereto with respect to his engagement except as set forth herein.
(e) Governing Law. This Agreement shall be governed by and construed
in accordance with the internal laws (and not the law of conflicts) of the State
of Florida.
(f) Severability. If any provision of this Agreement shall, for any
reason, be held unenforceable, such provision shall be severed from this
Agreement unless, as a result of such severance, the Agreement fails to reflect
the basic intent of the parties. If the Agreement continues to reflect the basic
intent of the parties, then the invalidity of such specific provision shall not
affect the enforceability of any other provision herein, and the remaining
provisions shall remain in full force and effect.
(g) Assignment. The Business Developer may not under any
circumstances delegate any of his rights and obligations hereunder without first
obtaining the prior written consent of the Company. This Agreement and all of
the Company's rights and obligations hereunder may be assigned or transferred by
it, in whole or in part, to be binding upon and inure to the benefit of any
subsidiary or successor of the Company.
(h) Costs of Enforcement. In the event of any suit or proceeding
seeking to enforce the terms, covenants, or conditions of this Agreement, the
prevailing party shall, in addition to all other remedies and relief that may be
available under this Agreement or applicable law, recover its or its reasonable
attorneys' fees and costs as shall be determined and awarded by the court.
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IN WITNESS WHEREOF, this Agreement is entered into on the day and year
first above written.
COMPANY:
Innova Holdings, Inc.
By: /s/ Xxxxxx Xxxxxx
------------------
Its: Chairman and CEO
BUSINESS DEVELOPER:
X. Xxxxx Holdings, Inc.
By: /s/ Xxxxx Xxxxx
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Exhibit A
OBJECTIVES
Initiation of Business Development activities with the following prospects:
Toyota
General Motors
Kodak
Disney
Universal Studios
XXXXXX xxxxxxxx at Speedweeks in Daytona
Home Depot
Lowes
Dupont
Georgia Pacific
Garmin
Closing of 0 contracts by March 31, 2005 Closing of 1 contracts by June 30,
2005 Closing of 2 contracts by September 30, 2005 Closing of 3 contracts by
December 31, 2005
The total sale value for all contracts closed in 2005 shall be a minimum of
$1,000.000.
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Exhibit B
Commission Schedule
Controller System Sales
10% commission on all new business delivered by the Business Developer to the
Company and its subsidiaries will be paid on a monthly basis upon the
Company's purchase order acceptance and final payments received from the
customer to X. Xxxxx Holdings, Inc., a Florida corporation.
License Agreements
On all license fees received prior to the commencement of license royalty
fees(up-front cash), a 10% commission will be paid upon receipt of such up-front
cash from the new License Agreements delivered by the Business Developer to the
Company and its subsidiaries. Such commission will be paid on a monthly basis.
On all license royalty fees received from new License Agreements (for the period
after the up-front cash period) delivered by the Business Developer to the
Company and its subsidiaries, a commission will be paid on a monthly basis in
accordance with the following commission schedule:
For the first twelve (12) month period of License Agreement 5% For the
13th through the 24th month period of the License Agreement
4%
For the 25th through the 36th month period of the License Agreement 3% For
the 37th through the 48th month period of the License Agreement
2%
For the 49th through the 60th month of the License Agreement 1% For the
period after the 60th month of the License Agreement
0
All commissions will be paid to X. Xxxxx Holdings, Inc., a Florida
corporation.
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