Exhibit 4.6
SERVICE AGREEMENT - AVI XXXXXXX
SERVICES AGREEMENT
This Services Agreement (the "AGREEMENT") is made and entered into as of October
1st , 2001, by and between SuperCom Ltd., a company existing under the laws of
the State of Israel (the "COMPANY") and AVI XXXXXXX, ID No. 000000000 (the
"SERVICE PROVIDER").
WHEREAS the Company requires such services as set forth in this Agreement;
and
WHEREAS the Service Provider represents that he has the necessary knowledge
and experience and is capable of competently and diligently
providing all the services under this Agreement; and
WHEREAS the Service Provider has been previously employed by the Company and
the Company is aware of the Service Provider's skills and abilities;
and
WHEREAS the Company desires to retain the services of the Service Provider
pursuant to the terms and conditions set forth in this Agreement and
the Service provider agrees to provide such services to the Company
on such terms and conditions.
NOW, THEREFORE, the parties hereto agree as follows:
1. GENERAL
1.1 The preamble to this Agreement constitutes an integral part
hereof.
1.2 The headings of the sections and subsections of this Agreement
are for convenience of reference only and are not to be
considered in interpreting this Agreement.
2. THE SERVICES
2.1 As of October 1, 2001 (the "EFFECTIVE DATE"), subject to the
approval of the appropriate organs of the Company as required by
any applicable law or regulation thereunder, the Company hereby
engages the Service Provider and the Service Provider hereby
agrees to provide the Company with services as with services as
Research Manager of the Company (the "SERVICES"). The Services
shall be rendered in a diligent, conscientious and professional
manner, pursuant to guidelines and procedures set forth by the
Board of Directors of the Company from time to time.
2.2 The Service Provider acknowledges that the consulting Services
will require minimum 30 man-hours per month and will require
regular attendance to the needs of the Company. The Services
shall be to the satisfaction of the Company, as determined in the
unrestricted discretion of the Board of Directors of the Company.
SERVICE AGREEMENT - AVI XXXXXXX
3. REPRESENTATIONS AND WARRANTEES OF THE SERVICE PROVIDER
The Service Provider represents and warrants the following:
3.1 That subject to the receipt of all appropriate approvals required
by any applicable law, there are no legal, contractual or any
other restrictions limiting his ability to perform the Services
under this Agreement in accordance with the terms hereof.
3.2 That he has the necessary knowledge and experience and is capable
of competently and diligently providing all the services under
this Agreement.
3.3 That pursuant to an employment agreement between himself and the
Company dated July 1, 1999 (the "EMPLOYMENT AGREEMENT") the
Company employed him as Research Manager of the Company until
September 30th 2001 (the "EMPLOYMENT PERIOD").
3.4 That following the termination of the Employment Agreement and
the end of the Employment Period he is no longer an employee of
the Company and that excepts for the payment of the such amount
as obligated by the company as apart of the resignation of the
Employee.
4. TERM AND TERMINATION
4.1 This Agreement shall enter into force and effect on the Effective
Date, subject to the receipt of all appropriate approvals
required by applicable law, including, as applicable, the
approval of the Audit Committee, Board of Directors and
Shareholders of the Company.
4.2 The Company may terminate this agreement, subject to decision of
the Board of Directors of the Company, by providing 60 days prior
written notice.
4.3 The Service Provider may terminate this Agreement by providing 60
days prior written notice.
4.4 Without derogating from the provisions of Sections 4.1 and 4.3
above, this Agreement may be terminated by the Company
immediately upon any of the following events: (a) a perpetration
by the Service Provider of a criminal offence, or a breach of
trust or impairment to the Company, its monies, property, assets
or employees by the Service Provider; (b) a breach of the Service
Provider's undertakings with regard to confidentiality,
intellectual property or non-competition; (c) any other breach by
the Service Provider of this Agreement which has not been cured
within thirty (30) days following receipt of a written notice of
such breach.
4.5 In any event of termination of this Agreement for any reason
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SERVICE AGREEMENT - AVI XXXXXXX
whatsoever, the Service Provider shall assist the Company with
transferring all of the Service Provider's activities to any
other person or entity chosen by the Company in an orderly
fashion.
5. CONSIDERATION
5.1 The Company shall pay the Service Provider a monthly amount of
NIS 20,000 for the Services (the "CONSIDERATION"). Other than as
expressly provided for in this Agreement, the Service Provider
shall not be entitled to any other payment or consideration of
any type or nature whatsoever, including, without limitation, any
fees, bonuses, reimbursement for expenses or the like. The
aforementioned monthly pay amount shall be linked to the Dollar
Exchange rate as published on the date of the payment.
5.2 Each payment shall be made against an invoice, issued by the
Service Provider, to the full satisfaction of the Company.
Applicable Value Added Tax shall be added to each payment.
5.3 In addition to the Consideration, and for as long as the Service
Provider shall provide the Company with the Services under this
Agreement, the Company shall provide the Service Provider with a
Company owned cellular phone and an automobile, including
reimbursement of all related maintenance, fuel, repairs,
insurance and other costs. The automobile to be provided to the
Service Provider shall not be of a lesser type or quality than
the Employee had during the Employment Period.
5.4 The payments to be made by the Company to the Service Provider
hereunder (including issuance of shares pursuant to Section 6
below), is inclusive of all taxes, levies and other compulsory
payments of any kind, all of which shall be borne by the Service
Provider solely. To the extent required under any applicable law,
the Company may withhold any tax from any payment to the Service
Provider hereunder and remit the balance to the Service Provider.
6. OPTION
6.1 The Service provider shall have the option to receive, in lieu of
payment of the Consideration as detailed in Section 5 above,
securities of the Company and/or of SHC Inc., a subsidiary of the
Company (the "OPTION").
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SERVICE AGREEMENT - AVI XXXXXXX
6.2 In the event that the Service Provider wishes to exercise the
Option, he shall provide the Company with a written notice to
such effect (the "OPTION NOTICE"). Following the receipt of the
Option Notice by the Company, the parties will negotiate in good
faith the terms and conditions of the exercise of the Option by
the Service Provider, including, without limitation, the type of
securities to be issued to the Service Provider, the price of
such securities and any other terms, conditions, restrictions and
limitations applicable to such issuance.
6.3 In the event that the parties have conducted negotiations in good
faith and have failed to mutually agree upon the terms and
conditions of the exercise of the Option, the Service Provider's
sole remedy shall be the payment of the Consideration by the
Company.
6.4 The parties hereto acknowledge and agree that exercise of the
Option by the Service Provider shall be subject to the receipt of
all appropriate approvals required by applicable law.
7. CONFIDENTIALITY; PROPRIETARY RIGHTS
7.1 CONFIDENTIALITY. The Service Provider recognizes and acknowledges
that the systems (including specifications, programs and
documentation), the methods and data, and the developments,
designs, inventions, improvements, trade secrets and works of
authorship, which the Company, or any employee thereof, owns
plans, or develops (whether for its own use or for use by its
clients) are confidential and are the property of the Company.
All of these materials and information will be referred to below
as "Proprietary Information".
The Service Provider further recognizes and acknowledges that any
discoveries, developments, designs, inventions and improvements,
directly or indirectly related to the business of the Company or
its clients (the "CREATIONS") made or acquired by him and whether
or not made or acquired by him in business hours or at the
premises of the Company and whether or not made or acquired with
the assistance of materials supplied by the Company and whether
or not the Service Provider shall have been requested by the
Company to make or acquire such Creations shall belong to the
Company.
Upon request, the Service Provider will execute any instrument
required to vest in the Company complete title and ownership to
such Creations, and will at the request and expense of the
Company execute any necessary instrument to obtain legal
protection in Israel and foreign countries for such Creations and
for the purposes of vesting title thereto in the Company, all
without any additional compensation of any kind to the Service
Provider.
7.2 NON-DISCLOSURE. The Service Provider agrees that, except as
directed by the Company, he will not, during the term of this
Agreement and for and
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SERVICE AGREEMENT - AVI XXXXXXX
unlimited time thereafter, disclose to any third party or use,
directly or indirectly, whether for his own benefit or the
benefit of others, any Proprietary Information, or permit any
third party to examine or make copies of any document (whether in
written or any other form) which may contain or be derived from
the Proprietary Information.
8. NON-COMPETITION
The Service Provider undertakes not, directly or indirectly (whether
as owner, partner, consultant, employee or otherwise) at any time,
during and for two (2) years following the Commencement Date (as
defined below), to engage in any work or activity that is competitive
with the Company's activities or products actively marketed or under
active development by the Company, nor to solicit any employee of the
Company to resign from or otherwise leave the employment of the
Company.
The term "Commencement Date" shall mean the later of (a) the date in
which this Agreement has been terminated for any reason; or (b) the
date in which the Service Provider ceases to be, directly or
indirectly (including holdings by a family Member), an interested
party in the Company. For the purpose of this Section 8 the terms
"Interested party" and "Family Member" shall have the same meaning as
such terms are defined in section 1 of the Israeli Securities Law,
1968.
9. INDEPENDENT CONTRACTOR
9.1 The relationship between the parties under this Agreement is
strictly that of independent parties, where the Service Provider,
acting solely as an independent contractor, shall supply the
Services to the Company. Nothing herein shall be deemed to create
the relationship of employer-employee, agency, joint venture or
partnership between the parties or between either of the parties
and any third person.
9.2 The Service Provider undertakes that he and/or anyone on his
behalf shall not assert any claim against the Company, its
shareholders, directors, officers or representatives any cause of
action or claim in connection with employer-employee relations
which may have allegedly existed between him and the Company, and
if he does so, he shall indemnify the Company upon its first
demand for any expense that may be occasioned to it in respect of
or in connection with a claim as aforesaid, including attorney's
fees.
9.3 Without prejudice to the generality of the foregoing, it is
hereby agreed that the Service Provider and anyone acting on his
behalf shall not be entitled to receive from the Company any
severance pay and/or any other payment and/or other consideration
deriving from employer-
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SERVICE AGREEMENT - AVI XXXXXXX
employee relations and/or the termination thereof and/or any
social benefits.
9.4 If for any reason whatsoever a competent authority, including a
judicial body, determines that the Service Provider or any one on
his behalf is the Company's employee, the following provisions
shall apply:
9.4.1 In lieu of the Consideration that was paid to the Service
Provider from the Effective Date, the Service Provider
shall be deemed to have been entitled only to a reduced
consideration (gross) of 70% of the consideration actually
paid to the Service Provider (the "REDUCED CONSIDERATION"),
and in such event the Service Provider shall be deemed only
entitled to the Reduced Consideration retroactively from
the Effective Date.
9.4.2 The Service Provider shall immediately refund to the
Company any amount paid from the Effective Date that was
paid in excess of the Reduced Consideration, linked to the
Israeli consumer price index from the date of each payment
to the date of actual refund.
10. MISCELLANEOUS
10.1 ASSIGNMENT. The Service Provider is prohibited from assigning any
of his obligations or rights under this Agreement to any third
party without the express prior written consent of the Company.
10.2 COMPLETE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the matters
referred to herein, and no other arrangement, understanding or
agreement, verbal or otherwise, shall be binding upon the parties
hereto. The parties hereto agree and represent that the
Employment Agreement is terminated as of the Effective Date.
10.3 GOVERNING LAW, JURISDICTION. This Agreement shall be governed by
and construed exclusively according to the laws of the State of
Israel, and any dispute arising under or in connection herewith
shall be presented in and determined exclusively by the courts of
the state of Israel.
10.4 NO WAIVER. No failure or delay on the part of any party hereto in
exercising any right, power or remedy thereunder shall operate as
a waiver thereof, nor shall any single or partial exercise of any
such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or
remedy. Any waiver granted thereunder must be in writing and
shall be valid only in the specific instance in which given.
10.5 SEVERABILITY. If any provision of this Agreement is held by a
court of competent jurisdiction to be unenforceable under
applicable law, then such provision shall be excluded from this
Agreement and the remainder of this Agreement shall be
interpreted as if such provision were so
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SERVICE AGREEMENT - AVI XXXXXXX
excluded and shall be enforceable in accordance with its terms;
provided, however, that in such event this Agreement shall be
interpreted so as to give effect, to the greatest extent
consistent with and permitted by applicable law, to the meaning
and intention of the excluded provision as determined by such
court of competent jurisdiction
10.6 NOTICES. All notices and other communications required or
permitted hereunder to be given to a partyto this Agreement shall
be in writing and shall be faxed or mailed by registered or
certified mail, postage prepaid, or otherwise delivered by hand
or by messenger, addressed to such party's address as set forth
below or at such other address as the party shall have furnished
to each other party in writing in accordance with this provision:
if to the Company: Supercom Ltd.
0 Xxxxxx Xx. Xxxxxxx, Xxxxxx.
if to the Service Provider: Avi Xxxxxxx
00 Xxxxxx Xxxxxx Xx.,
Xxxxxx Xxxx, Xxxxxx.
Any notice sent in accordance with this Section 10.6 shall be
effective (i) if mailed by registered or certified mail, four (4)
business days after mailing, (ii) if sent by messenger, upon
actual receipt or refusal thereof, and (iii) if sent via
facsimile, upon transmission and electronic confirmation of
receipt or (if transmitted and received on a non-business day) on
the first business day following transmission and electronic
confirmation of receipt (provided, however, that any notice of
change of address shall only be valid upon receipt).
IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto as
of the day and year first above written.
SuperCom Ltd. AVI XXXXXXX
/s/ GOLD XXXXX /s/ AVI XXXXXXX
By: ____________________ _______________________
________________________
Name (Print)
CFO
_______________________
Title
52852-2\0\15\0
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