EXHIBIT 4.01
NON-QUALIFIED PLAN
CONSULTING AGREEMENT
On this 18th day of October, 2002, this Consulting Agreement (the
"Agreement") is entered by and between INTERNATIONAL AUTOMATED SYSTEMS, INC., a
Utah corporation, (hereinafter referred to as "IAS" or Company) and XXXXXXX
XXXXXXX, XXXXXXX XXXXXXX, S. XXXXXX XXXX, XXXXXXXXXXX XXXXXX, XXXXXX XXXX,
XXXXXX XXXXXXXX, and XXXXXXX XXXXXX (hereinafter collectively and individually
referred to as "Consultants). Consultants principal place of business is located
as stated herein. IASs place of business is 000 Xxxxx X.X. 000, Xxxxx, Xxxx
00000.
1. Parties.
Consultants are engaged to perform consulting services for the Company
which services have not been and shall not be related to equity formation or
capital raising activities and specifically are not in connection with the offer
or sale of securities in a capital-raising transaction. Consultants shall
provide services which benefit the Company. Some of the Consultants are also
employees of the Company, but upon approval and review of the Board of
Directors, may be considered Consultants under this Agreement. All consulting
services under this Agreement shall be performed within the next 180 days from
the date hereof. Consultants shall provide planning and development of the
Companys technologies and other services as designated with the Board of
Directors.
2. The Companys Responsibilities, Duties and Obligations.
A. The Company has the following responsibilities:
1. The Company shall provide shares of common stock (Shares) as
compensation to Consultants for the consulting services under this
Agreement as set forth on Exhibit A. Further, the Company shall provide any
information which it can reasonably provide to assist in the filing of the
Form S-8 with the U.S. Securities and Exchange Commission.
2. The Company shall use its best efforts to file all periodic reports in a
timely manner.
3. The Company shall provide all information and data as needed by the
Consultants under this Agreement
4. The Company agrees to compensate the law firm of Xxxxxxx X. Xxxxxx, P.C.
in the amount of 20,000 shares for services to be performed in filing the
S-8 registration statement.
3. Consultants Rights, Duties and Obligations.
A. Consultants, individually or jointly, shall do the following:
1. Consultants shall provide assistance to IAS including, but not limited
to, the development, commercialization, promotion, advancement, and
maturation of the technology and of IAS.
2. Consultants shall use best efforts in performing their services. The
immediate term of this Agreement shall be one hundred and eighty days.
3. Consultants in filing the Form S-8 shall make complete and accurate
statements and representations as required and shall comply with all
requirements relating to the filing on Form S-8.
4. Consultants shall be subject to the direction of IAS officers in
performing the consulting services. All services shall be performed in
discussion between IAS and Consultants. Consultants, who are employees,
acknowledge that the services they provide as consultants shall not be the
same as services provided as employees.
5. Consultants agree to accept as full and complete compensation for their
services as consultants the Shares as stated on Exhibit A except employees
shall be entitled to receive their normal compensation.
4. No Rights or Interest Acquired.
By operation of this Agreement or in any other manner Consultants shall not
have and hereafter shall not have any interest of any kind in the Companys
products or other projects for which Consultants are providing consulting
services. Further, Consultants acknowledge IAS right to its products and
services and Consultants agree never to challenge IAS rights to and ownership of
any of IAS products or technology. Consultants acknowledge that they,
individually and jointly, have no right to or interest of any kind in IAS
technology or trade secrets or any information related in any manner to the
technology or trade secrets.
5. Termination and Breach of this Agreement.
Either party may terminate this Agreement upon thirty days written notice
to the other explicitly stating that this Agreement shall be terminated. Upon
the termination of this Agreement Consultants agree to return any and all
property pertaining in any way to the Company and its products, technology or
trade secrets within a reasonable time after termination. Any notice shall be
given to the party at the address listed herein.
6. Non-Disclosure and Confidentiality.
Consultants shall not other than in the ordinary and necessary course of
this Agreement at any time or in any manner, either directly or indirectly, use,
divulge, disclose or communicate to any person, entity, firm or corporation in
any manner whatsoever, any information concerning any matter affecting or
relating to IAS business, including but not limited to information regarding
customers, trade secrets, price structure, and profits; and any information
concerning the Companys technology and any information pertaining to the
Companys products, any successor products, or any future products or services
provided including, but not limited to, structure, specifications, operations,
plans, processes, designs, concepts, data, marketing plans, marketing schedules,
or procedures. Consultants agree that all the foregoing shall be deemed to be
the Companys property and shall be acknowledged to confidential, material and
important.
7. Arbitration
A. Resolution of Disputes. Any dispute arising under or related to this
Agreement that can not be reasonably resolved by the mutual efforts of the
parties shall be resolved by arbitration in accordance with the Commercial
Arbitration Rules of the American Arbitration Association. The arbitration
hearing shall be conducted by a single neutral arbitrator appointed in
accordance with said rules, who shall be knowledgeable in the industry but not
affiliated with any party. The arbitrator shall have no power to alter or
modify any provision of this Agreement or to render any decision which by its
terms affects any such alteration or modification or is otherwise inconsistent
with this Agreement. The parties agree that any arbitration hearing shall only
be held in Salt Lake City, Utah.
B. Expenses. All expenses in connection with such arbitration, including a
reasonable compensation to the arbitrator, shall be divided equally among the
parties, with the exception of expenses of witnesses and employees of the
parties hereto, which, unless otherwise determined by the arbitrator, shall be
borne by the party incurring them; except the prevailing party in any such
arbitration shall be entitled to an award of its reasonable attorneys' fees and
expenses.
8. FORCE MAJEURE
A. Suspension of Obligations. The Company shall not be considered to be in
breach of or default under this Agreement in the event and for as long as the
Company is prevented from fulfilling its obligations by reason of Force Majeure
as defined.
B. Definition. The term "Force Majeure, shall be deemed for the purposes of
this Agreement to mean any cause or condition beyond any partys reasonable
control which such party is unable to overcome by the exercise of reasonable
diligence including, but not limited to, mean acts of God, strikes, lockouts or
other industrial disturbances, acts of the public enemy, wars, blockades,
terrorism, insurrection, riots, epidemics, landslides, lightning, earthquakes,
fires, storms, floods, high water, washouts, arrests and restraints of
governments and people, civil disturbances, explosions, breakage or accident to
equipment and other operating facilities, acts of military authority and any
other cause, whether of the kind herein enumerated or otherwise, not within the
control of the parties and which, the parties are unable to prevent or overcome.
Should there be an event of Force Majeure affecting performance under this
Agreement, such event will be remedied with all reasonable dispatch to ensure
resumption of normal performance.
9. Indemnification.
A. Each individual Consultant agrees that he shall indemnify and hold the
Company harmless from any actions or claims asserted against the Company based
on the his or her conduct and actions.
B. The Company agrees that it shall indemnify and hold Consultant harmless
from any actions or claims asserted against Consultant based on the conduct and
actions or services performed for the Company.
10. Status of Parties and Assignability of Agreement.
The Company as one party and Consultants as the other party are each acting
as an independent contractor in performing this Agreement and each is not an
employee (other than those consultants who are also employees) or partner of the
other. Neither party shall be the agent for other party except as stated herein
and each party and shall not have the power to bind contractually the other.
Consultants may not assign this Agreement without the Companys written consent.
Provisions of this Agreement will survive its termination. No partnership
between the parties shall be created by this Agreement or its operations.
11. Severability and Attorneys Fees.
All agreements and covenants contained in this Agreement are severable, and in
the event any of them shall be held to be invalid in court, this Agreement shall
be interpreted as if such valid terms or covenants were not contained herein;
but all other conditions shall be valid and enforceable. If either party to
this Agreement seeks to enforce any of its provisions, the prevailing party
shall be entitled to recover his attorney's fees and expenses incurred in such
action. This Agreement shall be interpreted under the laws of the State of
Utah.
12. Written Waiver Required.
Neither party may waive or release any of its rights or interests in this
Agreement except in writing. Failure to assert any right arising from this
Agreement shall not be deemed or construed as a waiver of such right.
13. Entire Agreement.
This Agreement constitutes the entire agreement between the parties and
supersedes all prior negotiations, representations, agreements, and
understandings, and any and all such matters are merged into, extinguished by,
and completely expressed herein.
14. Damages Limited to Actual Damages.
Either party shall have the right to seek from the other party only actual
damages and not consequential, special, liquidated, loss of profits, or punitive
damages for any breaches of this Agreement or claimed breaches of this Agreement
or any claims arising from transactions in any manner related to this Agreement.
15. Construction.
The parties agree that any rule of construction to the effect that
ambiguities are to be resolved against the drafting Party shall not be applied
in the construction or interpretation of this Agreement. Neither party shall be
deemed to be the draftor or preparer of the Agreement and any ambiguities may
not be construed against either party as the draftor, scrivener or preparer.
The term he shall also include, where appropriate she.
(THIS SPACE INTENTIONALLY LEFT BLANK)
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In Witness Whereof, the Company and Consultants have signed this Agreement
to be given effect as of the date written above.
Consultants
XxXxxxx Xxxxxxx Xxxxxxx Xxxxxxx
Address: Address:
Xxxxxx Xxxx Xxxxxxxxxxx Xxxxxx
________________________ ______________________________
Address: Address:
S. Xxxxxx Xxxx Xxxxxx Xxxxxxxx
________________________ ______________________________
Address: Address:
Xxxxxxx Xxxxxx
______________________________
Address:
INTERNATIONAL AUTOMATED SYSTEMS, INC.
By
Date
EXHIBIT A
NAME NUMBER OF SHARES
XxXxxxx Xxxxxxx 250,000
Xxxxxxx Xxxxxxx 250,000
Xxxxxx Xxxx 100,000
Xxxxxxxxxxx Xxxxxx 100,000
S. Xxxxxx Xxxx 100,000
Xxxxxx Xxxxxxxx 65,000
Xxxxxxx Xxxxxx 20,000
