EXHIBIT 10.1
CONSULTING AGREEMENT
This Consulting Agreement (the "Agreement") is entered into
by and between ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ (the "Consultant") and Giga Information
Group, Inc. (the "Company") as of August 29, 2002.
The Consultant has been requested by the Company to provide
consulting services and advice as requested by the Company in accordance with
the terms, covenants and conditions set forth below.
In consideration of the following terms, covenants and conditions, the parties
agree as follows:
1. Term. The term of the Agreement shall be the period
commencing on August 29, 2002 and ending on the day that is thirty (30) days
after the appointment of a new President and Chief Executive Officer of the
Company, provided that either party may terminate the Agreement upon not less
than thirty (30) days' prior written notice to the other.
2. Services. The Consultant agrees to serve as a consultant
to the Company during the term of the Agreement, to provide the following
services: (a) from August 29, 2002 to and including October 31, 2002 (the date
as to which ▇▇▇▇▇▇ ▇▇▇▇▇▇ shall cease to act as full-time President and Chief
Executive Officer) the Consultant shall (i) serve as Non-Executive Chairman of
the Board of Directors of the Company (the "Board"), acting as chairman of
meetings of the Board and performing such other duties as are assigned to him by
the Board in accordance with the By-laws of the Company, and (ii) serve as
Chairman and supervise the activities of the Search Committee that was appointed
by the Board on August 29, 2002, to identify potential candidates to serve as
President and Chief Executive Officer of the Company; and (b) from November 1,
2002 until the end of the term of the Agreement the Consultant shall render the
services set forth in Section 2(a) hereof and in addition, the Consultant shall
(i) interact with the officers of the Company, providing advice, guidance and
knowledge related to strategy and executive management as reasonably required by
the Company, (ii) represent the Company in the Consultant's capacity as Chairman
of the Board where necessary to provide an element of continuity, (iii) interact
with the Chief Financial Officer of the Company, providing advice, guidance and
expertise related to financial matters, (iv) brief the Board, from time to time,
regarding the status of the Company's affairs, and (v) assist with the
transition of the new President and Chief Executive Officer of the Company. The
Consultant shall allocate approximately 1/3 of his business time to rendering
services to the Company hereunder. Nothing contained herein shall preclude the
Consultant from representing, performing services for or being employed by such
additional clients, persons or companies (other than a competitor of the
Company) as the Consultant in his sole discretion sees fit, so long as such
activities do not conflict or interfere with the Consultant's performance under
the Agreement.
3. Independent Contractor. The Consultant shall be an
independent contractor in the making and performance of the Agreement and is
not, and shall not be construed to be, an employee, agent or servant of the
Company. The Company shall have no liability whatsoever for withholding,
collection or payment of income taxes or for taxes of any other nature on behalf
of the Consultant, and the Consultant hereby agrees to indemnify the Company for
any liability, cost or expense incurred by the Company as a result of the
Company's failure to withhold. Under no circumstances shall the Consultant have
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or claim to have power of decision hereunder in any activity on behalf of the
Company, nor shall he have the power or authority hereunder to obligate, bind or
commit the Company in any respect. It is specifically understood that the
Company shall not, with respect to the Consultant's services, exercise or have
the power to exercise such control over the Consultant as would indicate or
establish that a relationship of employer and employee exists between the
Consultant and the Company. The Consultant is free to engage at the Consultant's
expense such other employees or agents of the Consultant that the Consultant
deems necessary for the satisfactory completion of the performance of the
services set forth in Section 2 hereof, provided that any such employees or
agents first execute the Company's standard form of Confidential and Proprietary
Information, Trade Secrets and Non-Solicitation Agreement. The parties further
agree that the Consultant shall have the right to control the manner and means
by which the contracted performance of his services is achieved, subject only to
the satisfaction of the Company as to the quality, effectiveness and timeliness
of the required results.
4. Fees and Expenses. The Company shall pay the Consultant a
fee at the rate of $11,111 per month for the term of the Agreement. The
aforementioned fee is based on the Consultant devoting approximately 1/3 of his
business time to consulting services for the Company hereunder and will be
equitably adjusted for any mutually agreed upon change of hours of services
provided. The fees for services shall be paid monthly. If either party
terminates the Agreement before the expiration of the term specified in
paragraph 1, the fees owed shall be prorated according to the number of full or
partial months elapsed. The Company agrees to reimburse the Consultant for
reasonable travel, living and related expenses incurred by the Consultant when
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requested by the Company to travel hereunder, upon submission of appropriate
documentation. Airplane travel shall comply with the Company's Business Travel
and Expense Policy.
5. Stock Option. Simultaneously with the execution of the
Agreement on October 2, 2002 the Company's Compensation Committee has (a)
granted to the Consultant a five-year, non-qualified stock option for 30,000
shares of the Company Common Stock (25,000 shares relating to the commencement
of the services set forth in Section 2 hereof and an additional 5,000 shares for
services provided by the Consultant in September 2002); and (b) authorized the
grant to the Consultant on the last business day of each month, beginning on
October 31, 2002, of a five-year non-qualified stock option for 5,000 shares of
the Company Common Stock, so long as the Consultant performs his services
pursuant to Section 2 hereof and until such time as the new President and Chief
Executive Officer is appointed. Each option granted pursuant to this Section 5
will: (a) be granted under the Company's 1999 Share Incentive Plan with an
exercise price equal to the Fair Market Value of the Common Stock at the time of
grant, in accordance with a customary stock option agreement and grant letter to
be entered into with the Consultant; (b) provide for immediate vesting; and (c)
be subject to the terms and conditions of the Company's 1999 Share Incentive
Plan.
6. Confidential Information. The Consultant understands and
acknowledges that during the term of the Agreement he may have access to and
become acquainted with certain confidential information and trade secrets, which
are private or confidential in that they are not generally known or available to
the public, or give the Company, and its subsidiaries and related companies, an
opportunity to obtain an advantage over competitors who do not know or use such
information. The Consultant agrees that he shall not disclose any such
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confidential information or trade secrets to any person or entity, either
directly or indirectly, or use said confidential information or trade secrets
for his personal benefit or in any other way, except in the performance of the
Consultant's responsibilities set forth in the Agreement. However, this
obligation will not apply to information which is or becomes publicly available
without fault on the part of the Consultant, is already in the Consultant's
possession prior to the time the Consultant gains access to the data under the
Agreement, is independently developed by the Consultant, or is rightfully
obtained from third parties. Upon termination of the Agreement, the Consultant
shall return to the Company all copies of all data, materials and documents that
belong to the Company (whether or not such data, materials or documents were
prepared by the Company, the Consultant or others).
7. Governing Law. The Agreement shall in all respects be
interpreted, enforced and governed under the laws of the Commonwealth of
Massachusetts.
8. Arbitration. (a) All disputes between the Consultant (and
his attorneys, successors and assigns) and the Company (and its affiliates,
shareholders, directors, officers, employees, agents, successors, attorneys, and
assigns) relating in any manner to any and all disputes arising out of or
relating to the Agreement or the interpretation or breach thereof ("Arbitrable
Claims") shall be resolved by arbitration. All persons and entities specified in
the preceding sentence (other than the Company and the Consultant) shall be
considered third-party beneficiaries of the rights and obligations created by
this Section on Arbitration. Arbitrable Claims shall include, but are not
limited to, contract (express or implied) and tort claims of all kinds, as well
as all claims based on any federal, state, or local law, statute, or regulation,
excepting only claims under applicable workers' compensation law and
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unemployment insurance claims. Arbitration shall be final and binding upon the
parties and shall be the exclusive remedy for all Arbitrable Claims, except that
the Company may, at its option, seek injunctive relief and damages in court for
any breach of Section 6 of the Agreement. Subject to the foregoing sentence, THE
PARTIES HEREBY WAIVE ANY RIGHTS THEY MAY HAVE TO TRIAL BY JURY IN REGARD TO
ARBITRABLE CLAIMS.
(b) Arbitration of Arbitrable Claims shall be in accordance
with the Employment Dispute Resolution Rules of the American Arbitration
Association ("AAA Employment Rules"), except as provided otherwise in the
Agreement. In any arbitration, the burden of proof shall be allocated as
provided by applicable law. Either party may bring an action in court to compel
arbitration under the Agreement and to enforce an arbitration award. Otherwise,
neither party shall initiate or prosecute any lawsuit or administrative action
in any way related to any Arbitrable Claim. All arbitration hearings under the
Agreement shall be conducted at the Company office or branch where the Agreement
was executed or, in the event the branch is no longer in operation, at the
Company office geographically closest to the place where the Agreement was
executed. The Federal Arbitration Act shall govern the interpretation and
enforcement of this Section. The fees of the arbitrator shall be split between
both parties equally. All proceedings and all documents prepared in connection
with any Arbitrable Claim shall be confidential and, unless otherwise required
by law, the subject matter thereof shall nor be disclosed to any person other
than the parties to the proceedings, their counsel, witnesses and experts, the
arbitrator, and, if involved, the court and court staff.
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9. Survival. The rights and obligations of the Consultant
and the Company set forth in Sections 4, 6 and 8 shall survive the expiration or
termination of the Agreement.
10. Entire the Agreement; Amendments. The Agreement sets
forth the entire agreement between the parties and fully supersedes any and all
prior agreements or understandings between the parties relating to the subject
matter hereof. Any amendment or modification to the Agreement must be made in
writing and signed by both parties. Nothing contained herein shall affect the
Consultant's rights or obligations as a director of the Company or any other
compensation he may receive in such capacity.
11. Counterparts. The Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which
taken together shall constitute one and the same instrument.
12. Notices. All notices under the Agreement shall be in
writing and delivered in person or sent by telefax or by registered mail,
charges prepaid. Any notice given hereunder shall be deemed to be received and
effective (i) on the date of such delivery or (ii) on the date of receipt of
confirmation by answerback, in the case of telefax, in each case to the
appropriate address or telefax number set forth below (or to such other
addresses or telefax numbers as a party may designate as to itself by notice to
the other party):
If to the Company:
Giga Information Group, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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If to the Consultant:
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
13. Assignability. The Consultant may not assign, transfer,
pledge, encumber or hypothecate the Agreement, or any of his rights hereunder
(whether by operation of law or otherwise), and the Agreement shall not be
subject to execution, attachment or similar proceeding. Any attempted
assignment, transfer, pledge, encumbrance, hypothecation or other disposition of
the Agreement, contrary to the provisions hereof, and the levy of any attachment
or similar proceeding upon the Agreement, or the Consultant's rights hereunder,
shall be null and void and without effect, but the benefits and obligations of
the Consultant hereunder shall inure to the benefit of and shall be binding upon
his heirs, executors, administrators, and legal representatives. The Agreement
shall inure to the benefit of and shall be binding upon the Company and its
successors.
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IN WITNESS WHEREOF, the parties hereto have executed the
Agreement on this 2nd day of October 2002.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Date: October 2, 2002
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Giga Information Group, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: Senior Vice President and CFO
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Date: October 2, 2002
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