Exhibit 4.2
CONSULTING AGREEMENT
THIS AGREEMENT, made, entered into this 1st day of November, 2002 (the
"Effective Date"), by and between Xxxxx Xxxxx, an individual (hereinafter
referred to as "Consultant"), and LAW ENFORCEMENT ASSOCIATES CORPORATION, a
Nevada corporation with its principal place of business at 000 Xxxxxx Xxxxx,
Xxxxxxxxxxx, Xxxxx Xxxxxxxx 00000 (hereinafter referred to as "Corporation").
W I T N E S S E T H:
WHEREAS, Consultant has provided valuable services to the Corporation
and the Corporation realizes that Consultant has demonstrated a keen
understanding of the Corporation's operations such that it would be desirable to
retain Consultant's services under a consulting agreement;
WHEREAS, Consultant desires to provide such consulting services for the
Corporation as an independent contractor, with the understanding that he shall
not be required to devote his full time to the business of the Corporation and
shall be free to pursue other personal and business interests; and
NOW, THEREFORE, in consideration of the premises, the mutual covenants
of the parties herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by each of the parties
hereto, it is agreed as follows:
1. CONSULTING ARRANGEMENT. The Corporation hereby contracts for the services of
Consultant and Consultant agrees to perform such duties and responsibilities and
to render advice and consulting as may be requested by the Corporation from time
to time during the term of this consulting arrangement in connection with the
Corporation's business throughout the United States and world wide ("Consulting
Arrangement"). Said consulting services shall include, but not be limited to,
legal and general business services. Consultant shall use his best efforts to
keep the Corporation informed of all corporate business opportunities which
shall come to his attention and appear beneficial to the Corporation's business
so that the Corporation can obtain the maximum benefits from Consultant's
knowledge, experience, and personal contacts.
2. RELATIONSHIP BETWEEN PARTIES. During the term of the Consulting Arrangement,
Consultant shall be deemed to be an independent contractor. Consultant shall not
be considered as having an employee status vis-a-vis the Corporation, or by
virtue of the Consulting Arrangement being entitled to participate in any plans,
arrangements or distributions by the Corporation pertaining to or in connection
with any pension, stock, bonus, profit sharing, welfare benefits, or similar
benefits for the regular employees of the Corporation. The Corporation shall not
withhold any taxes in connection with the compensation due Consultant hereunder,
and Consultant will be responsible for the payment of any such taxes and hereby
agrees to indemnify the Corporation against nonpayment thereof.
3. COMPENSATION FOR THE CONSULTING ARRANGEMENT. As part of the consideration for
the services to be rendered under the Consulting Arrangement by Consultant and
as compensation for the income he could have otherwise earned if he had not
agreed to keep himself available to the Corporation hereunder, the Corporation
issue to the Consultant 100,000 shares of common stock, $.001 par value per
share.
4. TERM OF CONSULTING ARRANGEMENT. The Consulting Arrangement shall begin
effective as of the Effective Date and shall continue for a period of twelve
(12) months from the Effective Date (the "Consulting Period").
5. CONFIDENTIALITY COVENANTS.
5.1 Acknowledgments by the Consultant. The Consultant acknowledges that
(a) during the Consulting Period and as a part of his Consulting Arrangement,
the Consultant will be afforded access to Confidential Information (as defined
below); (b) public disclosure of such Confidential Information could have an
adverse effect on the Corporation and its business; (c) because the Consultant
possesses substantial technical expertise and skill with respect to the
Corporation's business, the Corporation desires to obtain exclusive ownership of
each Consultant Invention (as defined below), and the Corporation will be at a
substantial competitive disadvantage if it fails to acquire exclusive ownership
of each Consultant Invention; (d) the provisions of this Section 5 are
reasonable and necessary to prevent the improper use or disclosure of
Confidential Information and to provide the Corporation with exclusive ownership
of all Consultant Inventions.
5.2 Agreements of the Consultant. In consideration of the compensation
and benefits to be paid or provided to the Consultant by the Corporation under
this Agreement, the Consultant covenants as follows:
(a) Confidentiality.
(i) During and following the Consulting Period, the
Consultant will hold in confidence the Confidential
Information and will not disclose it to any person except
with the specific prior written consent of the Corporation
or except as otherwise expressly permitted by the terms of
this Agreement.
(ii) Any trade secrets of the Corporation will be
entitled to all of the protections and benefits under
California law and any other applicable law. If any
information that the Corporation deems to be a trade secret
is found by a court of competent jurisdiction not to be a
trade secret for purposes of this Agreement, such
information will, nevertheless, be considered Confidential
Information for purposes of this Agreement. The Consultant
hereby waives any requirement that the Corporation submit
proof of the economic value of any trade secret or post a
bond or other security.
(iii) None of the foregoing obligations and
restrictions applies to any part of the Confidential
Information that the Consultant demonstrates was or became
generally available to the public other than as a result of
a disclosure by the Consultant.
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(iv) The Consultant will not remove from the
Corporation's premises (except to the extent such removal is
for purposes of the performance of the Consultant's duties
at home or while traveling, or except as otherwise
specifically authorized by the Corporation) any document,
record, notebook, plan, model, component, device, or
computer software or code, whether embodied in a disk or in
any other form (collectively, the "Proprietary Items"). The
Consultant recognizes that, as between the Corporation and
the Consultant, all of the Proprietary Items, whether or not
developed by the Consultant, are the exclusive property of
the Corporation. Upon termination of this Agreement by
either party, or upon the request of the Corporation during
the Consulting Period, the Consultant will return to the
Corporation all of the Proprietary Items in the Consultant's
possession or subject to the Consultant's control, and the
Consultant shall not retain any copies, abstracts, sketches,
or other physical embodiment of any of the Proprietary
Items.
(b) Consultant Inventions. Each Consultant Invention will
belong exclusively to the Corporation. The Consultant acknowledges that all of
the Consultant's writing, works of authorship, and other Consultant Inventions
are works made for hire and the property of the Corporation, including any
copyrights, patents, or other intellectual property rights pertaining thereto.
If it is determined that any such works are not works made for hire, the
Consultant hereby assigns to the Corporation all of the Consultant's right,
title, and interest, including all rights of copyright, patent, and other
intellectual property rights, to or in such Consultant Inventions. The
Consultant covenants that he will promptly:
(i) disclose to the Corporation in writing any
Consultant Invention;
(ii) assign to the Corporation or to a party designated
by the Corporation, at the Corporation's request and without
additional compensation, all of the Consultant's right to
the Consultant Invention for the United States and all
foreign jurisdictions;
(iii) execute and deliver to the Corporation such
applications, assignments, and other documents as the
Corporation may request in order to apply for and obtain
patents or other registrations with respect to any
Consultant Invention in the United States and any foreign
jurisdictions;
(iv) sign all other papers necessary to carry out the
above obligations; and
(v) give testimony and render any other assistance in
support of the Corporation's rights to any Consultant
Invention.
5.3 Disputes or Controversies. The Consultant recognizes that should a
dispute or controversy arising from or relating to this Agreement be submitted
for adjudication to any court, arbitration panel, or other third party, the
preservation of the secrecy of Confidential Information may be jeopardized. All
pleadings, documents, testimony, and records relating to any such adjudication
will be maintained in secrecy and will be available for inspection by the
Corporation, the Consultant, and their respective attorneys and experts, who
will agree, in advance and in writing, to receive and maintain all such
information in secrecy, except as may be limited by them in writing.
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5.4 Definitions.
(a) For the purposes of this Section 5, "Confidential
Information" shall mean any and all:
(i) trade secrets concerning the business and affairs
of the Corporation, product specifications, data, know-how,
formulae, compositions, processes, designs, sketches,
photographs, graphs, drawings, samples, inventions and
ideas, past, current, and planned research and development,
current and planned manufacturing or distribution methods
and processes, customer lists, current and anticipated
customer requirements, price lists, market studies, business
plans, computer software and programs (including object code
and source code), computer software and database
technologies, systems, structures, and architectures (and
related formulae, compositions, processes, improvements,
devices, know-how, inventions, discoveries, concepts, ideas,
designs, methods and information, and any other information,
however documented, that is a trade secret within the
meaning of Chapter 688, Florida Statutes;
(ii) information concerning the business and affairs of
the Corporation (which includes historical financial
statements, financial projections and budgets, historical
and projected sales, capital spending budgets and plans, the
names and backgrounds of key personnel, personnel training
and techniques and materials, however documented; and
(iii) notes, analysis, compilations, studies,
summaries, and other material prepared by or for the
Corporation containing or based, in whole or in part, on any
information included in the foregoing.
(b) For the purposes of this Section 5, "Consultant Invention"
shall mean any idea, invention, technique, modification, process, or improvement
(whether patentable or not), any industrial design (whether registerable or
not), any mask work, however fixed or encoded, that is suitable to be fixed,
embedded or programmed in a semiconductor product (whether recordable or not),
and any work of authorship (whether or not copyright protection may be obtained
for it) created, conceived, or developed by the Consultant, either solely or in
conjunction with others, during the Consulting Period, or a period that includes
a portion of the Consulting Period, that relates in any way to, or is useful in
any manner in, the business then being conducted or proposed to be conducted by
the Corporation, and any such item created by the Consultant, either solely or
in conjunction with others, following termination of the Consultant's Consulting
Arrangement with the Corporation, that is based upon or uses Confidential
Information.
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6. NON-COMPETITION AND NON-INTERFERENCE
6.1 Acknowledgments by the Consultant. The Consultant acknowledges
that: (a) the services to be performed by him under this Agreement are of a
special, unique, unusual, extraordinary, and intellectual character; (b) the
Corporation's business is national in scope and its products are marketed
throughout the United States and world wide; (c) the Corporation competes with
other businesses that are or could be located in any part of the United States
and world wide; (d) the provisions of this Section 6 are reasonable and
necessary to protect the Corporation's business.
6.2 Covenants of the Consultant. In consideration of the
acknowledgments by the Consultant, and in consideration of the compensation and
benefits to be paid or provided to the Consultant by the Corporation, the
Consultant covenants that he may not, directly or indirectly:
(a) during the Consulting Period, except in the course of his
Consulting Arrangement hereunder, and during the Post-Consulting Period (as
defined below), engage or invest in, own, manage, operate, finance, control, or
participate in the ownership, management, operation, financing, or control of,
be employed by, associated with, or in any manner connected with, lend the
Consultant's name or any similar name to, lend Consultant's credit to or render
services or advice to, any business whose products or activities compete in
whole or in part with the products or activities of the Corporation anywhere
within the United States; provided, however, that the Consultant may purchase or
otherwise acquire up to (but not more than) one percent of any class of
securities of any enterprise (but without otherwise participating in the
activities of such enterprise) if such securities are listed on any national or
regional securities exchange or have been registered under Section 12(g) of the
Securities Exchange Act of 1934;
(b) whether for the Consultant's own account or for the
account of any other person, at any time during the Consulting Period and the
Post-Consulting Period, solicit business of the same or similar type being
carried on by the Corporation, from any person known by the Consultant to be a
customer of the Corporation, whether or not the Consultant had personal contact
with such person during and by reason of the Consultant's Consulting Arrangement
with the Corporation;
(c) whether for the Consultant's own account or the account of
any other person (i) at any time during the Consulting Period and the
Post-Consulting Period, solicit, employ, or otherwise engage as an employee,
independent contractor, or otherwise, any person who is or was an employee of
the Corporation at any time during the Consulting Period or in any manner induce
or attempt to induce any employee of the Corporation to terminate his Consulting
Arrangement with the Corporation; or (ii) at any time during the Consulting
Period and for three years thereafter, interfere with the Corporation's
relationship with any person, including any person who at any time during the
Consulting Period was an employee, contractor, supplier, or customer of the
Corporation; or
(d) at any time during or after the Consulting Period,
disparage the Corporation or any of its shareholders, directors, officers,
employees, or agents.
For purposes of this Section 6.2, the term "Post-Consulting
Period" means the three year period beginning on the date of termination of the
Consultant's Consulting Arrangement with the Corporation.
If any covenant in this Section 6.2 is held to be
unreasonable, arbitrary, or against public policy, such covenant will be
considered to be divisible with respect to scope, time, and geographic area, and
such lesser scope, time, or geographic area, or all of them, as a court of
competent jurisdiction may determine to be reasonable, not arbitrary, and not
against public policy, will be effective, binding, and enforceable against the
Consultant.
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The period of time applicable to any covenant in this Section
6.2 will be extended by the duration of any violation by the Consultant of such
covenant.
7. NOTICES. All notices, consents, waivers, and other communications under this
Agreement must be in writing and will be deemed to have been duly given when (a)
delivered by hand (with written confirmation of receipt), (b) sent by facsimile
(with written confirmation of receipt), provided that a copy is mailed by
registered mail, return receipt requested, or (c) when received by the
addressee, if sent by a nationally recognized overnight delivery service
(receipt requested), in each case to the appropriate addresses and facsimile
numbers set forth below (or to such other addresses and facsimile numbers as a
party may designate by notice to the other parties):
(a) if to the Corporation, to it at: with a copy to:
Law Enforcement Associates Xxxxxxx Xxxxxxxx, Esq.
Corporation Sichenzia Xxxx Xxxxxxxx Xxxxxxx LLP
100 Hunter Place 1065 Avenue of the Americas
Xxxxxxxxxxx, XX 00000 Xxx Xxxx, XX 00000
Fax: ( 000) 000-0000 Fax: (000) 000-0000
(b) if to Consultant, to it at: with a copy to:
Xxxxx Xxxxx
000 Xxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Fax: ( 919) [ ]
8. BINDING EFFECT. This Agreement shall extend to, shall inure to the
benefit of and shall be binding upon all the parties hereto and upon all of
their respective heirs, successors and representatives.
9. ENTIRE AGREEMENT. This Agreement, including the agreements incorporated by
reference, contains the entire Agreement among the parties hereto with respect
to the matters contemplated hereby and supersedes all prior agreements and
undertakings between the parties with respect to such matters. This Agreement
may not be amended, modified or terminated in whole or in part, except in
writing, executed by each of the parties hereto.
10. INDEMNIFICATION. Consultant hereby agrees to hold harmless and indemnify
Corporation from and against any and all loss, damage, expense, and cost
(including reasonable attorneys' fees incurred in connection with the same)
incurred by Corporation as a result of Consultant's breach of any covenant or
agreement made herein.
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11. SPECIFIC PERFORMANCE. The Consultant acknowledges that his obligations
hereunder are unique, and that it would be extremely impracticable to measure
the resulting damages if he should default in his obligations under this
Agreement. Accordingly, in the event of the failure by Consultant to perform his
obligations hereunder, which failure constitutes a breach hereof by him, the
Corporation may, in addition to any other available rights or remedies, xxx in
equity for specific performance and, in connection with any such suit, the
Consultant expressly waives the defense therein that the Corporation has an
adequate remedy at law.
12. SEVERABILITY. Should any part of any provision of this Agreement be declared
invalid by a court of competent jurisdiction, such decision or determination
shall not affect the validity of any remaining portion of such provision or any
other provision and the remainder of the Agreement shall remain in full force
and effect and shall be construed in all respects as if such invalid or
unenforceable provision or portion thereof were not contained herein. In the
event of a declaration of invalidity, the provision or portion thereof declared
invalid shall not necessarily be invalidated in its entirety, but shall be
observed and performed by the parties to the Agreement to the extent such
provision is valid and enforceable.
13. SECTION HEADINGS. The section headings contained herein are for
convenience of reference only and shall not be considered any part of the terms
of this Agreement.
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14. CHOICE OF LAW. This Agreement shall be interpreted and performed in
accordance with the laws of the State of North Carolina, and the parties agree,
notwithstanding the principles of conflicts of law, that the internal laws of
the State of North Carolina shall govern and control the validity,
interpretation, performance, and enforcement of this Agreement.
IN WITNESS WHEREOF, Consultant has hereunto put his hand, and the
Corporation has caused this instrument to be executed in its corporate name by
its duly authorized officer, all as of the day and year first above written.
CONSULTANT:
/s/ Xxxxx Xxxxx
Xxxxx Xxxxx
CORPORATION:
Law Enforcement Associates Corporation
By: /s/ Xxxx Xxxxxxx
Xxxx Xxxxxxx, President
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