EXHIBIT 10.7
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CONSULTING AGREEMENT
This Consulting Agreement is made and entered into as of the 31st day of
October, 1994, by and between LP TECHNOLOGIES, INC., a Florida corporation
(hereinafter referred to as the "Consultant") and SOFTSENSE COMPUTER PRODUCTS
INC., a New York corporation (hereinafter referred to as the "Company").
W I T N E S S E T H:
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WHEREAS, the Company is engaged in the business of designing, developing,
manufacturing and marketing software application products for the convenience
store and fast food industries and for the quick-lube and oil change marketplace
(the "Business"); and
WHEREAS, the Company desires to engage the Consultant to provide certain
consulting services to the Company all as more fully set forth in this
Agreement; and
WHEREAS, Consultant has agreed to provide certain consultation services,
all upon the terms and conditions more fully set forth herein; and
NOW, THEREFORE, for and in consideration of the premises, the mutual
covenants contained herein, and other good and valuable consideration, the
receipt, adequacy and sufficiency of which are hereby acknowledged, the parties
hereto covenant and agree as follows:
1. Consultant Services. Subject to the terms and conditions of this
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Agreement, the Company hereby engages Consultant as an independent consultant,
and Consultant hereby accepts said engagement with the Company. During the term
hereof, the Consultant shall render to the Company such services (hereinafter
referred to as the "Services") of an advisory or consultative nature as the
Company may reasonably request, so that the Company may have the benefit of
Consultant's experience and knowledge of the affairs of the Company and of
Consultant's reputation and contacts in the Business, and Consultant will be
available for advice and counsel to the officers and directors of the Company.
The Services to be provided by Consultant to the Company hereunder shall include
the following:
(a) Select the best technology to exploit the growing fields of
virtual reality, multimedia and computer simulations.
(b) Create a platform consisting of "building blocks" which the
Company can use to create new products;
(c) Keep current on developing technologies and present its findings
to the Company's senior management at the Company's headquarters on a quarterly
basis (and reduce the content of the presentation to hard copy); and
(d) Perform an audit of the Company's development program not less
than twice annually, in accordance with the following:
(i) Review backup procedures: Verify that the Company's
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development program has been making sufficient backups and that these backups
are in a secure place. To ensure that this is being done, one or more backups
will be restored into a temporary directory to confirm that they have been made
properly and are in working order. This will also ensure that the restoration
process is functioning.
(ii) Review version control: Ensure version control is being used
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for all major development projects. To ensure that version control is being
used, one or more previously checked in versions will be restored to a temporary
directory and compiled to make sure that the code is synchronized, and that the
development environment needed to compile the code is readily available.
(iii) Review third party software: Review the number of third party
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development software products in use, and ensure that the proper number of
licenses have been purchased, and that the products are being used in accordance
with the terms of the license agreements.
(iv) Development manager interviews: Interview development managers
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to gain their perspective on the development function.
(v) Summary report: Compile and present a summary report to senior
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management.
Consultant shall devote not less than 40 hours per audit of the Company's
development program.
(e) Consultant shall provide such services, and other duties for
which Consultant is qualified by knowledge or experience, as the Company may
from time to time request. Consultant's services and duties shall be performed
in a competent and professional manner but the Company shall not direct the
Consultant in the manner in which it performs its services or duties hereunder.
2. Compensation. For all the Services to be performed under this
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Agreement, the Company shall pay to the Consultant (i) the sum of One Hundred
and Fifty Thousand Dollars ($150,000) on or before November 30, 1994 and (ii)
the sum of Fourteen Thousand Dollars ($14,000) per month (the "Monthly Fee") on
the last day of each month during the five (5) year period beginning on January
31, 1995 and ending on December 31, 1999. Notwithstanding the foregoing, on
January 1, 1996 and on each January 1 thereafter during the term of this
Agreement, Consultant may, in its discretion, increase the Monthly Fee by an
amount not to exceed 5% per year.
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Consultant shall be solely responsible for payment of any and all expenses
incurred by Consultant in the performance of its services hereunder and
Consultant shall not be entitled to reimbursement from the Company for any such
expenses.
3. Policies. If Consultant performs Services at the Company's offices,
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Consultant shall observe business hours, holiday schedules and all policies and
security rules of the Company in connection with the performance of the Services
hereunder.
4. Rights and Product. Except as otherwise agreed to by the parties, all
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information, reports, studies, object or source codes (including computer
program platforms which may be used to create various application software
products), flow charts, diagrams, ideas, inventions and improvements, and any
other tangible or intangible material of any nature whatsoever produced by or as
a result of any of the Services, and all copies or derivations of any of the
foregoing ("Work Product"), shall be jointly owned by the Company and
Consultant, it being the intention of the parties that all Work Product be
deemed jointly conceived and developed by the parties hereto, and the parties
shall jointly own all related patent, trademark, copyright or other tangible or
intangible rights whatsoever. Both during and after Consultant's engagement
under this Agreement, each party agrees to execute, at no additional
consideration, any documents, applications or other instruments reasonably
requested by the other party in order to make any patent, trademark or copyright
applications with respect to the Work Product, or otherwise to perfect, evidence
or defend the parties' ownership of such Work Product. The parties agree to
share the expenses related to the foregoing.
5. Warranty and Indemnification by Consultant. The Consultant represents
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and warrants to the Company that none of the Services rendered or Work Product
provided to the Company will in any way violate or infringe upon any patent,
trademark, copyright or other rights of third parties or violate any laws.
Consultant shall indemnify the Company and hold it harmless against any claim or
action which alleges that the use of the Work Product in the manner suggested by
Consultant infringes any patent, trademark, copyright, or other proprietary
right of any third party or violates any law, and Consultant shall pay all costs
and damages of the Company (including reasonable attorneys' fees) provided that
the Company notifies Consultant promptly of any such claims. Notwithstanding
anything contained in this Paragraph 5 to the contrary, Consultant shall have no
liability or indemnification obligations hereunder with respect to any act or
omission done at the express direction of the Company, and the Company shall
indemnify Consultant and hold it harmless from and against any claim or action
which results from any act or omission of the Consultant which is taken at the
express direction of the Company.
6. Confidential Information. The Consultant acknowledges and agrees that
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all tangible and intangible information obtained or developed (i) in connection
with the prior employment with the Company of any affiliate of Consultant and
(ii) in connection with the performance and execution of this Agreement, is
deemed by the Company and shall be considered to be confidential and proprietary
information ("Confidential Information") containing valuable business
information
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and trade secrets of the Company relating to its business practices
and critical to its competitive position in the marketplace. Confidential
Information shall not include information which is or becomes information in the
public domain through no action on the part of Consultant. Confidential
Information may include, but is not limited to, technical information such as
formulas, patterns, devices, computer program source and object codes,
compositions, inventions, processes, specifications, research, methods and know-
how; business information such as financial statements, sales reports, cost-
price information, sales policies, employee lists, margins, expenses, profits,
sources of supply and distribution, lists of customers and active prospective
clients or suppliers and matters related to the Company's future development or
strategy. The Consultant shall not disclose, directly or indirectly, any
Confidential Information or use Confidential Information in any way except for
the purpose of rendering the Services under this Agreement. All lists,
printouts, reports, files, records, documents, computer program source and
object codes, drawings, blueprints, specifications, manuals, letters, notes,
notebooks, sketches, formulas, memoranda, codes, and similar items, whether in
tangible form or stored by electronic means, coming into Consultant's possession
during the term of this Agreement, shall remain the exclusive property of the
Company (and if prepared by Consultant, the joint property of the Company and
Consultant), and, upon termination of this Agreement, the Consultant agrees to
deliver all tangible materials containing Confidential Information (including
all copies thereof) which are in Consultant's possession or control and to
delete or destroy any Confidential Information maintained by Consultant on
electronic media (other than jointly owned materials, a copy of which may be
retained by Consultant). The Consultant agrees to ensure that any consultant,
employee, agent or subcontractor of a Consultant permitted access to any portion
of the Confidential Information in the course of his or her employment is
advised of the proprietary and confidential nature of the Confidential
Information and that any such person shall be required by a Consultant as a
condition of his or her assignment to the Company to sign a Confidentiality and
Nondisclosure Agreement agreeing personally to abide by the restrictions
contained herein. The Consultant agrees to notify the Company promptly and in
writing of any circumstances of which Consultant has knowledge relating to any
possession, use or knowledge of any portion of the Confidential Information by
any authorized person. Consultant's obligations hereunder shall survive the
expiration or termination of this Agreement for a period of three (3) years;
provided, however, that with respect to any item of Confidential Information
which rises to the level of a trade secret under applicable law, the
Consultant's obligations hereunder shall, to the fullest extent permitted by
applicable law, survive the expiration of said three (3) year period and forever
remain in full force and effect. The Company's rights under this Agreement are
in addition to those rights the Company has under the common laws or applicable
statutes for the protection of trade secrets. Nothing contained herein shall be
deemed to prohibit Consultant from making any disclosure required by law;
provided, however, that prior to making any such disclosure Consultant shall
provide the Company with reasonable notice in order that the Company may seek a
protective order should it so desire.
7. Remedies, Injunction. The Consultant acknowledges that any breach or
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threatened breach by Consultant of paragraph 6 above could cause the Company
irreparable harm which cannot be compensated by payment of damages.
Accordingly, in the event of any breach or
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threatened breach by Consultant of paragraph 6 of this Agreement, Consultant
agrees that the Company, in addition to any other rights, remedies or damages
available to the Company at law or in equity, should be entitled to injunctive
relief in order to prevent or restraint any such breach or threatened breach by
Consultant. Consultant further acknowledges and agrees that the covenants
contained in paragraph 6 of this Agreement are necessary for the protection of
the Company's legitimate business interests, are reasonable in scope and
content, and will not prevent the Consultant from earning a livelihood.
8. Indemnity and Insurance. The Consultant agrees to indemnify the
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Company for any liability or expense incurred by the Company due to claims for
personal injury or property damage arising out of or in connection with
Consultant's performance of the Services, as well as from any claim for payment
of compensation, salary, taxes, or other benefits asserted by or with respect to
any employee of Consultant. Consultant agrees to maintain worker's compensation,
general liability and automobile liability insurance in an amount sufficient to
protect against all reasonably foreseeable risks in connection with the
performance of the Services.
9. Term and Termination. This Agreement shall commence on the date shown
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above and shall continue in full force and effect thereafter until December 31,
1999. The Company may immediately terminate this Agreement for cause at any
time. "Cause" as used herein shall be limited to non-compliance by Consultant
with the requirements of paragraph 1(d) of this Agreement.
The expiration, cancellation or termination of this Agreement, for whatever
reason, will not discharge or relieve either party from any obligation which
accrued prior to such expiration, cancellation or termination, will not relieve
any party that has breached this Agreement from liability for damages resulting
from such breach and will not destroy or diminish the binding force and effect
of any of the provisions of this Agreement that expressly, or by reasonable
implication, come into or continue in effect on or after cancellation or
termination hereof.
10. Independent Contractor. The parties each acknowledge that their
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relationship under this Agreement is that of independent contractors. Neither
party shall have authority to bind the other party to any contract or agreement
of any kind, and shall not hold itself out to any party as having such
authority. Consultant shall be solely responsible for and shall pay when due
all worker's compensation, payroll, income, social security and other taxes of
any kind whatsoever due with respect to the work performed by Consultant or any
subcontractor of Consultant.
11. Notices. All notices and other communications hereunder shall be in
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writing and shall be deemed to have been given only if and when (i) personally
delivered, or (ii) three (3) business days after mailing, postage prepaid, by
certified mail, or (iii) when delivered (and receipted for) by an overnight
delivery service, or (iv) when first sent by telex, telecopier or other means of
instantaneous communication provided such communication is promptly confirmed by
personal delivery, mail or an overnight delivery service as provided above,
addressed in each case as follows:
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(a) If to the Consultant to:
LP Technologies, Inc.
000 Xxxxx Xxx Xxxxxxxx Xxxx
Xxxxxxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxxx X. Xxxxxx, President
with a copy in like manner to:
Xxxxxx X. Xxxxxx, Esq.
0000 Xxxxxxx Xxxxxx Xxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxx 00000
(b) If to the Company to:
Softsense Computer Products Inc.
0000 Xxxxxxx Xxxxx, Xxxxx X-0000
Xxxxxxx, Xxxxxxx 00000
Attention: President
with a copy in like manner to:
Xxxxx, Xxxxxxxx & Xxxxxxx
0000 Xxxxxxxxx Xxxx, X.X.
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxxx, Esq.
The Consultant, on the one hand, and the Company, on the other hand, may change
the address(es) for the giving of notices and communications to them or to it,
as the case may be, and/or copies thereof, by written notice to the other
parties in conformity with the foregoing.
12. Miscellaneous.
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(a) This Agreement shall not be amended or modified except by a writing
executed by both parties.
(b) A waiver of any default by either party of any of the terms and
conditions of this Agreement shall not be deemed to be a continuing waiver or a
waiver of any other provisions of this Agreement, but shall apply solely to the
instances to which such waiver is granted.
(c) This Agreement shall be binding upon and inure to the benefit of the
Company and Consultant and their respective successors and assigns.
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(d) This Agreement shall be governed by the laws of the State of Georgia
without regard to its rules governing conflicts of law.
(e) This Agreement represents the entire understanding of the parties
concerning the subject matter hereof and supersedes all prior or contemporary
communications, agreements and understandings, whether oral or written, relating
to the subject matter hereof.
(f) If any provision of this Agreement shall be held to be illegal,
invalid or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby. The
parties shall use their reasonable efforts to substitute the illegal, invalid,
or unenforceable provision by a legal, valid or enforceable one approximating as
closely as possible the original intent of the parties.
(g) No liability shall result to either party from delay in performance or
from nonperformance caused by circumstances beyond the reasonable control of the
party affected, including but not limited to, acts of God, fire, flood,
explosion, war, action or request of governmental authority, accident, labor
trouble or shortage, inability to obtain material, power, equipment or
transportation, or any other circumstances of a similar or different nature
beyond the reasonable control of the party so failing; provided, however, that
the party suffering the force majeure shall diligently attempt to remove such
cause or causes and shall promptly notify the other party of its extent and
probable duration; and further provided that events of force majeure shall not
affect or delay the Company's obligation to pay, when due, any sum owing under
this Agreement.
(h) Should any provision of this Agreement require judicial or arbitral
interpretation, it is agreed that the court or arbitrator interpreting or
construing the same shall not apply the presumption that the terms of any such
provision shall be more strictly construed against one party or the other by
reason of the rule of construction that a document is to be construed most
strictly against the party who itself or through its agent prepared the same, it
being agreed that both parties or their respective agents have participated in
the preparation of this Agreement.
(i) All disputes and claims relating to any provision hereof or relating
to or arising out of the parties relationship or creation or termination thereof
(including, without limitation, any claims that any provision of this Agreement
or any obligation of Consultant or of the Company is illegal or otherwise
unenforceable or voidable under law, ordinance or ruling) shall be settled by
arbitration at the office of the American Arbitration Association in Atlanta,
Georgia, in accordance with the United States Arbitration Act (9 USC, (S) 1 et
seq.) and the rules of the American Arbitration Association. The Consultant
consents and submits to the personal jurisdiction and venue of the trial courts
of DeKalb County, Georgia, and also to the personal jurisdiction and venue of
the United States District Court for the Northern District of Georgia for
purposes of enforcing this provision. All awards of the arbitration shall be
binding and non-appealable except as otherwise provided in the United States
Arbitration Act. Judgment upon the award of the arbitrator may be entered in any
court having jurisdiction thereof. The arbitration
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shall take place at a time noticed by the American Arbitration Association
regardless of whether one of the parties fails or refuses to participate. The
foregoing provision shall not preclude either party from bringing an action in
any court of competent jurisdiction for injunctive or other provisional relief
as necessary or appropriate. Each party hereto shall pay any and all expenses,
including attorneys' fees, incurred by such party in connection with such
arbitration proceeding, unless otherwise determined by the arbitrator. The
parties agree that the arbitration proceedings, and the amount of any award
thereunder, shall be confidential and shall not be disclosed to third parties,
except with the prior written approval of the other party to this Agreement or
as required by law.
(j) Any reference in this Agreement to a section shall be deemed to
include a reference to any subsidiary sections whenever the context requires.
(k) The captions of the sections and subsidiary sections of this Agreement
are included for reference purposes only and are not intended to be a part of
the Agreement or in any way to define, limit or describe the scope or intent of
the particular provision to which they refer.
(l) This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement, under seal,
as of the date first written above.
"COMPANY"
SOFTSENSE COMPUTER PRODUCTS INC.
By: /s/ Xxxx Xxxxx
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Title: President
"CONSULTANT"
LP TECHNOLOGIES, INC.
By: /s/ Xxxxxxxx X. Xxxxxx
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Xxxxxxxx X. Xxxxxx, President
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AMENDMENT NO. 1
TO
CONSULTING AGREEMENT
This Amendment ("Amendment No. 1") to the Consulting Agreement (the
"Agreement") between LP Technologies, Inc. ("Consultant") and Softsense Computer
Products Inc. (the "Company") dated October 31, 1994 is entered into as of the
24th day of October, 1995.
WHEREAS, under the Agreement, Consultant has agreed to provide certain
consulting services (the "Services") for the Company during the five year period
between October 31, 1994 and December 31, 1999;
WHEREAS, Consultant desires to suspend providing Services under the
Agreement between September 30, 1995 and December 31, 1997, which suspension the
Company has approved, provided Consultant resumes providing Services on January
1, 1998 and continues providing Services through December 31, 2001;
WHEREAS, to ensure Consultant resumes providing Services, the Company
agrees to pay Consultant a nominal monthly fee during the suspension period.
NOW, THEREFORE, for and in consideration of the mutual premises and
representations contained herein, and other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto agree
to amend the Agreement as follows:
1. Capitalized terms used but not otherwise defined herein shall have the
meaning as set forth in the Agreement.
2. Notwithstanding anything to the contrary in the Agreement, Services to
be provided by Consultant hereunder shall be suspended during the period
beginning September 30, 1995 and concluding December 31, 1997 (the "Suspension
Period"). Upon conclusion of the Suspension Period, Consultant shall resume
providing Services under the Agreement and shall continue through December 31,
2001.
3. Section 2, Compensation, is hereby modified by deleting the first full
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paragraph thereof in its entirety and replacing it with the following:
"For all the Services to be performed under this Agreement, the
Company shall pay to Consultant: (i) the sum of One Hundred and Fifty
Thousand Dollars ($150,000) on or before November 30, 1994; (ii) the sum of
Fourteen Thousand Dollars ($14,000) per month (the "Monthly Fee") on the
last day of each month during the period beginning on January 31, 1995 and
ending on September 30, 1995; (iii) a Monthly Fee of Two Thousand Five
Hundred Dollars ($2,500) on the last day of each month during the
Suspension Period; (iv) the sum of Sixteen Thousand Two Hundred and Seven
Dollars ($16,207) on the last day of each month during the calendar year
1998; (v) the sum of Seventeen Thousand and Seventeen Dollars
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($17,017) on the last day of each month during the calendar year 1999; (vi)
the sum of Seventeen Thousand Eight Hundred and Sixty Eight Dollars
($17,868) on the last day of each month during the calendar year 2000; (vi)
and Eighteen Thousand Seven Hundred and Sixty One Dollars ($18,761) on the
last day of each month during the calendar year 2001."
4. Xxxxxxx 0, Xxxx and Termination, is hereby modified by deleting the
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first sentence in its entirety and replacing it with the following:
"This Agreement shall commence on the date shown above and shall continue
in full force and effect thereafter until December 31, 2001."
5. Except as expressly amended herein, the Agreement shall remain in full
force and effect.
IN WITNESS WHEREOF, the parties have executed this Amendment No. 1 as of
the date first written above.
"Company"
Softsense Computer Products Inc.
By: /s/ Xxxx Xxxxxx
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Xxxx Xxxxxx
Title: Vice President and Chief Financial
Officer
"Consultant"
LP Technologies, Inc.
By: /s/ Xxxxxxxx X. Xxxxxx
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Xxxxxxxx X. Xxxxxx
Title: President
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