EXHIBIT 4.2
CONSULTING AGREEMENT
THIS AGREEMENT dated as of January 1, 2001.
AMONG:
XXXXXXX & COMPANY, INC.
("Xxxxxxx & Company")
AND:
IDEAS INC.
("Ideas")
(Xxxxxxx & Company and Ideas collectively referred to herein as
the "Consultant")
AND:
XXXX XXXXXXX
("Xxxxxxx")
AND:
XXXXX XXXXXX
("Xxxxxx")
AND:
UNITY WIRELESS CORPORATION
(the "Client")
WHEREAS:
A. The Client is a public company incorporated in Delaware and involved in the
business of the commercialization of wireless technologies;
X. Xxxxxxx & Company and Ideas have valuable experience in assisting companies
in finding acquisition and strategic partnership candidates and in consummating
acquisitions and strategic partnerships;
X. Xxxxxxx is an employee of Xxxxxxx & Company and has specialized and
particular knowledge and skills concerning the matters referred to in Recital B
and the business of the Client;
X. Xxxxxx is an employee of Ideas and has specialized and particular knowledge
and skills concerning the matters referred to in Recital B and the business of
the Client; and
E. The Consultant has agreed to provide consulting services to the Client,
further to the terms and conditions of this Agreement.
THIS AGREEMENT WITNESSES that in consideration of the premises and the mutual
covenants of the parties,the parties agree as follows:
1. Definitions
1.1 In this Agreement, the following words and phrases have the meanings set
forth after each:
(a) "Confidential Information" means all proprietary, confidential and
other non-public information, know-how and data (oral, written,
graphic, demonstrative, machine recognizable or otherwise) relating to
the proprietary technology and/or business of the Client which is
disclosed by the Client to the Consultant under this Agreement;
(b) "Consultant's Services" means the services to be provided by the
Consultant under this Agreement, as set out in s. 2.1 of this
Agreement;
(c) "Disclosure Materials" means materials prepared by the Client, with or
without the assistance of the Consultant, for presentation to a
potential acquisition and/or strategic partnership candidate;
(d) "Effective Date" means the date set forth on page one of this
Agreement;
(e) "Extraordinary Event" means the event described in s. 4.3 of this
Agreement;
(f) "Product(s)" means all products and services marketed, or intended to
be marketed, by the Client; and
(g) "Warrant" means a warrant entitling the holder to purchase up to
200,000 shares of the common stock of the Client at an exercise price
of $0.38 the terms and conditions of which are more particularly
described in Schedule A. 2.
The Consultant's Services
2.1 The Consultant will perform for the Client the following services:
(a) reviewing and advising on the managerial and marketing requirements of
the Client;
(b) assisting the Client in developing an effective investor relations
strategy;
(c) reviewing and advising on the budget, business plans and any other
corporate material of the Client;
(d) assisting the Client in finding acquisition and strategic partnership
candidates and in consummating acquisitions and strategic
partnerships;
(e) meeting and conferring with officers, employees and business contacts
of the Client;
(f) identifying and arranging meetings for the Client in the appropriate
investment markets (e.g. securities firms, institutional investors,
stock brokers, business media, analysts, fund managers and other
groups active in the wireless and hi tech sectors);
(g) reviewing and advising on the investor communication materials of the
Client, including annual reports, corporate brochures and website; and
(h) soliciting feedback from the investment, analyst and media communities
respecting the Client and presentations given by the Client.
2.2 The Consultant shall make no representations to potential investors or
third parties modifying the terms and conditions of Client's Product(s)
warranty or warranties. The Consultant may rely on such Product(s)
warranties as may be furnished to the Consultant by the Client or as may be
provided in the Uniform Commercial Code and inform potential investors and
third parties of such warranties, if required in the course of performing
its services hereunder.
2.3 The Consultant may, at its own discretion and at its own cost and expense,
employ, retain or contract with such persons, firms and corporations as the
Consultant may select in order to provide the Consultant's Services.
2.4 The Consultant will not represent itself as an agent of the Client and will
not make any representations or commitments on behalf of the Client without
the prior written consent of the Client.
2.5 Notwithstanding s. 2.3, the Consultant designates, and will provide and
make available the services of, Xxxxxxx and Xxxxxx to perform the
Consultant's Services, and represents and warrants that Xxxxxxx and Xxxxxx
have the required skills and experience to perform the services and to
exercise the responsibilities required of the Consultant under this
Agreement.
2.6 The Consultant will bear the sole, exclusive and complete responsibility
for the activities and remuneration of persons, firms and corporations
engaged under s. 2.3, and will indemnify the Client and its directors,
officers, employees and agents from and against any loss, liability, claim,
damage or expense, including the reasonable cost of investigating, settling
or defending any alleged loss, liability, claim, damage or expense and
reasonable counsel fees incurred in connection therewith, incurred by the
Client or its directors, officers, employees or agents as a result of, or
in connection with, the execution by the Consultant of the Consultant's
office and duties under this Agreement or the activities of persons, firms
and corporations engaged under s. 2.3.
2.7 The Consultant shall not be required to devote its full time and attention
to the performance of its duties under this Agreement, but shall devote
only so much of its time and attention as it deems reasonable or necessary
for such purposes. The Consultant shall be available to perform its
services under this Agreement in New York City or elsewhere, as reasonably
and mutually agreed upon by the Client and the Consultant.
3. Term and Termination
3.1 The term of this Agreement shall be for two years from the Effective Date,
subject to the right of either the Client or the Consultant to terminate
this Agreement on 30 days written notice.
4. Compensation
4.1 The Client shall pay the Consultant for the Consultant's Services as
follows:
(a) by the immediate vesting of 125,000 of the warrant rights under the
Warrant;
(b) during the term of this Agreement, by the vesting of the balance of
the warrant rights under the Warrant in equal quarterly instalments at
the end of each full calendar quarter of performance of the
Consultant's Services under this Agreement.
4.2 If the Client terminates this Agreement without cause, any unvested Warrant
rights shall immediately vest.
4.3 If the performance of the Consultant's Services results in an event
bringing extraordinary benefit to the Client, such extraordinary benefit to
be reasonably and mutually agreed upon by the parties at the time of
occurrence thereof, any unvested Warrant rights shall immediately vest and
the Consultant shall have no further obligations under this Agreement.
4.4 To the extent permitted by law, there shall be no withholding or payroll
taxes respecting the Warrant.
4.5 The Warrant represents the entire compensation payable to the Consultant
under this Agreement.The Consultant shall not be reimbursed for its
expenses.
5. Exercise of Warrant
5.1 Vested Warrant rights under this Agreement shall be exerciseable at any
time and from time to time as follows:
(a) if ss. 5.1(b), 5.1(c) and 5.1(d) do not apply, within one year from
the date of the expiration of the term of this Agreement, unless this
day falls on a non-business day, in which case the next business day
shall apply;
(b) if the Consultant has terminated the Agreement, within 90 days from
the effective date of the termination, unless this day falls on a
non-business day, in which case the next business day shall apply;
(c) if the Client has terminated the Agreement without cause, within one
year from the effective date of the termination, unless this day falls
on a non-business day, in which case the next business day shall
apply;
(d) if the Client has terminated the Agreement with cause, within 30 days
from the effective date of the termination, unless this day falls on a
non-business day, in which case the next business day shall apply; and
(e) upon the occurrence of an Extraordinary Event, within one year from
the effective date of the vesting of Warrant rights under s. 4.3,
unless this day falls on a non-business day, in which case the next
business day shall apply.
5.2 The Client shall not terminate this Agreement for cause unless it provides
the Consultant with 30 days prior written notice of such termination and an
opportunity to cure any breach referred to in such notice.
6. Registration of Shares
6.1 Upon the exercise of Warrant rights and as instructed by the Consultant,
the shares issuable under the Warrant shall be registered in the name of
the nominee(s) of the Consultant as outstanding on the books and records of
the Client.
6.2 Concurrently with registration of other shares of the common stock of the
Client under the Securities Act of 1933 and at the sole expense of the
Client, the Client will attend upon registration with the Securities and
Exchange Commission of the shares issuable under the Warrant.
7. Confidentiality
7.1 The Consultant, Xxxxxxx and Xxxxxx (referred to in this section,
collectively, as the "Disclosee") shall hold the Confidential Information
in trust for the Client (referred to in this section as the "Discloser")
and shall not disclose it to any unauthorized persons during or after the
termination of this Agreement, without the prior written consent of the
Discloser.
7.2 The obligations of the Disclosee and of their directors, officers and
employees, with respect to any Confidential Information disclosed to them
under this Agreement shall cease if the Confidential Information (i) was
legally known to or in the possession of the Disclosee at the time of
disclosure to the Disclosee by the Discloser, (ii) legally is or has become
part of the public domain through no fault of the Disclosee, (iii) has been
disclosed to the Disclosee by a third party on a non-confidential basis and
without breaching any contractual, confidential or fiduciary obligation or
any law or (iv) has been independently developed by the Disclosee without
reference to the Confidential Information.
8. Rights to Work Product
8.1 All patentable and unpatentable inventions, discoveries, ideas, materials
and programs which are made or conceived by the Consultant in the course of
or as a result of the performance of the Consultant's Services shall become
the sole and exclusive property of the Client throughout the world.
Promptly upon the conception of such invention, discovery, idea, materials
or program, the Consultant will disclose it to the Client and the Client
shall have the full power and authority to file and prosecute patent
applications throughout the world on it and to procure and maintain patents
on it. The Consultant shall, at the request and expense of the Client,
execute documents and perform such acts as legal counsel of the Client may
deem necessary or advisable, to confirm in the Client all right, title and
interest throughout the world, in and to such invention, discovery idea,
materials or program, and all patent applications, patents and copyrights
on it, and to assist the Client in procuring, maintaining, enforcing and
defining patents, xxxxx patents, copyrights, and other applicable statutory
protection throughout the world on any such invention, discovery, idea,
materials or programs which may be patentable or copyrightable. Without
limitation, the Consultant, as author of any written, graphic, artistic or
creative work, that the Consultant will produce as part of performing the
Consultant's Services, will transfer absolutely to the Client all of the
rights of the Consultant to the copyright in such work.
9. Disclosure Materials
9.1 All Disclosure Materials shall be subject to review by the Client and shall
not be distributed if the Client determines, in the Client's sole
discretion, that they would disclose Confidential Information or are
otherwise inappropriate.
10. No Partnership or Joint Venture
10.1 Nothing in this Agreement shall be construed to render one party liable for
any present or future debts, obligations or liabilities of another party or
to create a partnership or joint venture, or to render one party the
employee or the agent of another.
11. Representations and Warranties of the Consultant
11.1 The Consultant represents and warrants that its entry into and performance
under this Agreement does not violate any outstanding obligation,
contractual or otherwise, which the Consultant may owe to any third party,
nor any order, writ, injunction, decree, judgment, statute, rule, law or
ruling. 11.2 The Consultant warrants that the Consultant's Services will be
of the kind and quality designated.
12. Representations and Warranties of the Client
12.1 The Client represents and warrants that its entry into and performance
under this Agreement does not violate any outstanding obligation,
contractual or otherwise, which the Client may owe to any third party, nor
any order, writ, injunction, decree, judgment, statute, rule, law or
ruling.
12.2 The Client represents and warrants to the Consultant that: (a) all
information and documentation furnished by it to Consultant accurately will
depict in all material respects the Client and its business and proposed
business and will not, to the best of the Client's knowledge, contain
material misstatements or omissions; and (b) Disclosure Materials which the
Client approves as provided in s. 9.1 will accurately depict, in all
material respects, the Client and its business and proposed business, and
will not contain any material misstatements or omissions of material facts
which make any statement set forth therein materially false or misleading.
12.3 The Client represents and warrants to the Consultant that:
(a) the Warrant and the shares issuable thereunder (the "Shares") have
been fully authorized;
(b) the Client has taken all necessary action to authorize the issuance of
the Warrant and the Shares;
(c) when issued pursuant to the Warrant, the Shares will be validly issued
and non-assessable and no personal liability will attach to the
ownership of the Shares;
(d) the Client has reserved all Shares issuable pursuant to the Warrant
and will, at all times, reserve a sufficient number of Shares to
perform all of its obligations under the Warrant.
13. Indemnification by the Consultant
13.1 The Consultant will indemnify the Client, its directors, officers and
employees, successors and assigns from and against any and all claims,
demands, suits at law or in equity, loss, damage, attorney's fees and
liability of any kind due to, arising out of or resulting from a breach of
any covenant, representation or warranty made by the Consultant in this
Agreement.
14. Indemnification by the Client
14.1 The Client will indemnify the Consultant, its directors, officers,
employees, successors and assigns from and against any and all claims,
demands, suits at law or in equity, loss, damage, attorney's fees and
liability of any kind due to, arising out of or resulting from a breach of
any covenant, representation or warranty made by the Client in this
Agreement, including without limitation any claim brought by any third
party with respect to Disclosure Materials approved by the Client pursuant
to s. 9.1.
15. Termination of July 1, 2000 Consulting Agreement
15.1 The Consulting Agreement among the parties dated as of July 1, 2000 is
terminated and is of no further force or effect; and the Consultant
renounces all warrant rights vested thereunder.
16. General
16.1 The failure by a party to require performance of another party of any
provision hereof shall not affect in any way nor derogate from the full
right to require such performance at any time thereafter, nor shall the
waiver by a party of a breach of any provision hereof be held to be a
waiver of the provision itself. No breach shall be excused unless such
waiver or excuse of breach is in writing and signed by the waiving or
excusing party. No written waiver or excuse shall constitute a waiver or
excuse of any other or subsequent breach.
16.2 Notices given hereunder shall be in writing, and shall be deemed received
when personally delivered (by overnight courier or otherwise) or seven days
after mailing by certified or registered mail, return receipt requested,
postage prepaid, to the following respective addresses:
Notice to Xxxxxxx & Company, Inc., Ideas Inc., Xxxx Xxxxxxx and Xxxxx Xxxxxx:
000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
(000) 000-0000 (fax)
Notice to Unity Wireless Corporation:
0000 Xxxxxx Xxxx Xxxxx
Xxxxxxx, X.X. X0X 0X0
(000) 000-0000 (fax)
Any party may change such notice address by giving notice of such change to the
other parties.
16.3 This Agreement supersedes any other agreements, either oral or written,
between the parties and contains all of the agreements between the parties
pertaining to its subject matter. The parties acknowledge that no
representations, inducements, promises or agreements, orally or otherwise,
have been made by any party or anyone acting on behalf of any party which
are not embodied herein. No modification hereof shall be effective unless
in writing and signed by the parties.
16.4 Each of the parties shall, upon request, execute and deliver all such
further documents and instruments and do all such further acts and things
as may be reasonably necessary after the the execution and delivery of this
Agreement to evidence, carry out or give full effect to the terms,
conditions, intent and meaning of this Agreement.
16.5 This Agreement shall be governed by the laws of the Province of British
Columbia. The British Columbia courts shall have exclusive jurisdiction
over this Agreement and the enforcement thereof. 16.6 If any provision of
this Agreement not essential to its principal objectives is held by a court
of competent jurisdiction to be invalid, void or unenforceable, the
remaining provisions shall nevertheless continue in full force and effect
without being impaired or invalidated in any way, and each party agrees to
interpret and apply the Agreement to implement its intent to the extent
permitted by law.
16.7 All indemnities, covenants, representations and warranties contained in ss.
7, 8, 11, 12, 13 and 14 shall survive the expiration or earlier termination
of this Agreement.
16.8 All dollar amounts in this Agreement are in U.S. currency, unless otherwise
specified.
16.9 This Agreement may be executed by facsimile transmission and in several
counterparts, each of which counterparts together, shall form one original.
THE PARTIES INTENDING TO BE LEGALLY BOUND have executed this Agreement as of
the date first written above.
XXXXXXX & COMPANY, INC.
Authorized Signatory
IDEAS INC.
Authorized Signatory
XXXX XXXXXXX
XXXXX XXXXXX
UNITY WIRELESS CORPORATION
Authorized Signatory
