Consulting Services Agreement - Ask Jeeves Inc. and The Roda Group LLC
CONSULTING SERVICES AGREEMENT
THIS CONSULTING SERVICES AGREEMENT (the "Agreement") is made and entered
into by and between ASK JEEVES, INC., a California corporation (the
"Company"), and the RODA GROUP, L.L.C. (including each representative of the
Roda Group, L.L.C. who may provide services to the Company under this
Agreement, the "Consultant"), effective this 14th day of December, 1998.
RECITALS
WHEREAS, the Company desires Consultant's services with respect to the
management, operations and business development of the Company, and
Consultant agrees to provide such advice and services to the Company through
a consulting relationship with the Company; and
WHEREAS, the issuance of options to purchase Common Stock of the Company
hereunder is in connection with and in furtherance of the Company's
compensation of Consultant and is intended to comply with the provisions of
Rule 701 promulgated by the Securities and Exchange Commission under the
Securities Act of 1933, as amended.
NOW THEREFORE, in consideration of the mutual obligations specified in
this Agreement, the parties agree to the following:
1. CONSULTING SERVICES ENGAGEMENT. The Company hereby retains
Consultant, and Consultant hereby accepts such retention, to perform
consulting services for the Company as set forth herein.
(a) SCOPE. Consultant shall provide consulting services
("Services") to the Company as defined in Exhibit A attached hereto.
Consultant shall begin providing Services on December 31, 1998 (the "Start
Date").
(b) PERFORMANCE AND TIME COMMITMENT. Consultant shall render the
Services on a full time basis at the Company's principal place of business,
other Company locations, or at other places upon mutual agreement of the
parties.
(c) PROFESSIONAL STANDARDS. The manner and means used by
Consultant to perform the Services desired by the Company are in the
discretion and supervision of the Chief Executive Officer of the Company.
Consultant's Services, and the results thereof, will be performed with and be
the product of the highest degree of professional skill and expertise.
(d) INDEPENDENT CONTRACTOR STATUS. It is understood and agreed
that Consultant is an independent contractor, is not an agent or employee of
the Company, and is not authorized to act on behalf of the Company.
Consultant agrees not to hold him or herself out as, or give any person any
reason to believe that he or she is, an employee, agent, or partner of the
Company. Consultant will not be eligible for any employee benefits, nor will
the Company make deductions from any amounts payable to Consultant for taxes
or insurance. All payroll and
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employment taxes, insurance, and benefits shall be the sole responsibility of
Consultant. Consultant retains the right (as limited in Section 3) to
provide services for others during the term of this Agreement and is not
required to devote his or her services exclusively for the Company.
(e) INITIAL SERVICE PROVIDERS. The Services shall initially be
provided by Roger Strauch and Daniel Miller (each an "Initial Service
Provider" and collectively the "Initial Service Providers"). In the event
either Initial Service Provider ceases to provide the Services to Company,
Company, in the sole discretion of the Company's Chief Executive Officer, may
approve the appointment of a suitable replacement by Consultant (each a
"Subsequent Service Provider"). If such replacement is not approved, the
Company may terminate the Agreement in accordance with Section 7 below. Each
Subsequent Service Provider shall agree in writing to be bound by Section 3,
4 and 5 of this Agreement.
2. COMPENSATION.
(a) In consideration of Consultant's availability to provide
Services on a full time basis, the Company shall pay Consultant (i) Two
Hundred Thousand Dollars ($200,000) per year, to be paid in equal monthly
installments (each monthly installment being a "Cash Payment") and (ii) a
grant of an option to purchase an aggregate of One Hundred Fifty Thousand
(150,000) shares of the Company's Common Stock (the "Option"), subject to the
approval of the Board of Directors of the Company at an exercise price equal
to the fair market value on the date of such grant. The current fair market
value is $0.3638. The Option is not intended to qualify and will not be
treated as an "incentive stock option" within the meaning of Section 422 of
the Internal Revenue Code of 1986, as amended. The Option will be issued on
or about the Start Date, and will be evidenced by and subject to the
limitations contained in a Nonstatutory Stock Option Agreement in
substantially the form attached as Exhibit B hereto ("the Option Agreement").
Subject to the limitations contained in the Option Agreement, the Options
shall vest equally over the six month period commencing on the Start Date.
In the event the Services are no longer provided by Consultant, the Option
shall cease to vest.
(b) In the event either Initial Service Provider ceases to provide
the Services and a suitable replacement under Section 1(e) above is not
appointed, then (i) all remaining Cash Payments payable to and earned by
Consultant shall be reduced by one-half and (ii) the Options, to the extent not
already vested, shall vest equally over a twelve month period commencing on the
Start Date.
(c) In connection with the Services, Consultant shall:
(i) Provide general management services to Ask Jeeves, Inc.
(Roger Strauch)
(ii) Provide general sales and business development services to
Ask Jeeves, Inc. (Daniel Miller).
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(d) The Company shall reimburse Consultant for expenses actually
incurred by Consultant in performing the Services, including but not limited
to travel and accommodation expenses, so long as such expenses are reasonable
and necessary as determined by the Company. Consultant shall maintain
adequate books and records relating to any expenses to be reimbursed and
shall submit requests for reimbursement in a timely manner and form
acceptable to the Company.
3. NO CONFLICT OF INTEREST.
During the term of this Agreement, Consultant will not accept work,
enter into a contract, or accept an obligation from any third party,
inconsistent or incompatible with Consultant's obligations, or the scope of
services rendered for Client, under this Agreement. Consultant warrants that
there is no other contract or duty on its part inconsistent with this
Agreement. Consultant agrees to indemnify the Company from any and all loss
or liability incurred by reason of the alleged breach by Consultant of any
services agreement with any third party.
4. MAINTAINING CONFIDENTIAL INFORMATION.
(a) COMPANY INFORMATION. During the term of this Agreement and in
the course of Consultant's performance hereunder, Consultant may receive or
otherwise be exposed to confidential and proprietary information relating to
the Company's technology know-how, data, inventions, developments, plans
business practices, and strategies. Such confidential and proprietary
information of the Company (collectively referred to as "Information") may
include but not be limited to: (i) confidential and proprietary information
supplied to Consultant with the legend "Company Confidential" or equivalent;
(ii) the Company's marketing and customer support strategies, financial
information (including revenue, costs, profits and pricing methods), internal
organization, employee information, and customer lists; (iii) the Company's
technology, including, inventions, development efforts, data, software, trade
secrets, processes, methods, product and know-how and show-how; (iv) all
derivatives, improvements, additions, modifications, and enhancements to any
of the above, including any such information or material created or developed
by Consultant under this Agreement; and (v) information of third parties as
to which the Company has an obligation of confidentiality.
Consultant acknowledges the confidential and secret character of
the Information and agrees that the Information is the sole, exclusive and
extremely valuable property of the Company. Accordingly, Consultant agrees
not to reproduce any of the Information without the applicable prior written
consent of the Company, not to use the Information except in the performance
of this Agreement, and not to disclose all or any part of the Information in
any form to any third party, either during or after the term of this
Agreement. Upon termination of this Agreement for any reason, including
expiration of term, Consultant agrees to cease using and to return to the
Company all whole and partial copies and derivatives of the Information,
whether in Consultant's possession or under Consultant's direct or indirect
control.
(b) OTHER EMPLOYER INFORMATION. Consultant agrees that during its
engagement with the Company, Consultant will not improperly use or disclose
any proprietary
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information or trade secrets of his or her former or concurrent employers or
companies, if any, and that he or she will not bring onto the premises of the
Company any unpublished documents or any property belonging to his or her
former or concurrent employers or companies unless consented to in writing by
said employers or companies.
(c) THIRD PARTY INFORMATION. Consultant recognizes that the
Company has received and in the future will receive from third parties their
confidential or proprietary information subject to a duty on the Company's
part to maintain the confidentiality of such information and, in some cases,
to use it only for certain limited purposes. Consultant agrees that the
Company and such third parties, both during the term of this Agreement and
thereafter, are owed a duty to hold all such confidential or proprietary
information in the strictest confidence and not to disclose it to any person,
firm or corporation (except in a manner that is consistent with the Company's
agreement with the third party) or use it for the benefit of anyone other
than the Company or such third party (consistent with the Company's agreement
with the third party).
5. INVENTIONS.
(a) DISCLOSURE OF INVENTIONS. Consultant shall promptly and fully
disclose to the Company any and all ideas, improvements, inventions,
know-how, techniques and works of authorship learned, conceive or developed
by Consultant pursuant to this Agreement (the "Service Product"). Consultant
agrees to keep and maintain adequate and current records (in the form of
notes, sketches, drawings and in any other form that may be required by the
Company) of all work performed relating to the Services, including all
proprietary information developed relating thereto, and such records shall be
available to and remain the sole property of the Company at all times.
(b) INVENTIONS ASSIGNED TO THE COMPANY. Consultant agrees that
any and all Service Product shall be the sole and exclusive property of the
Company. Consultant hereby assigns to the Company all of Consultant's right,
title and interest in and to any and all Service Product. Consultant
explicitly acknowledges and agrees that all works of authorship contained in
the Service Product are "works for hire" under the copyright laws of the
United States, and that the Company shall own the copyright in all such works
of authorship.
Consultant further agrees that the Company is and shall be vested
with all rights, title and interests, including patent, copyright, trade
secret and trademark rights, in all of Consultant's Service Product under
this Agreement.
6. TERM OF AGREEMENT. This Agreement shall commence as of the date set
forth above, and it shall continue for twelve (12) months. Thereafter, the
Agreement may be renewed for successive twelve month periods, unless sooner
terminated by either party by written notice to the other party given at least
thirty (30) days prior to the expiration of any monthly renewal term, provided,
however that options to purchase shares of the Company's Common Stock shall be
granted upon the sole discretion of the Company. In the event of termination,
Consultant shall cease work immediately after giving or receiving such notice or
termination, unless otherwise advised by the Company, shall return to the
Company all Information, Service
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Product, and other materials belonging to the Company, and shall notify the
Company of costs incurred up to the termination date. Sections 4, 5 and 6 of
this Agreement shall survive any termination of this Agreement.
7. TERMINATION BY THE COMPANY. Notwithstanding Section 6 above, the
Company may terminate this Agreement with or without cause, at any time upon
thirty (30) days prior written notice to Consultant. The Company also may
terminate this Agreement or the Services: (i) upon thirty (30) days written
notice in the event of a material breach by Consultant of this Agreement or
any Service, PROVIDED THAT, such breach remains uncured at the end of such
thirty (30) day period; (ii) immediately in its sole discretion upon
Consultant's material breach of Sections 4 ("Maintaining Confidential
Information").
8. COMPLIANCE WITH APPLICABLE LAWS. Consultant warrants that all
material supplied and work performed under this Agreement complies with or
will comply with all applicable United States and foreign laws and
regulations.
9. ASSIGNMENT; BENEFIT. This Agreement is for the personal services
of Consultant and may not be assigned by Consultant or the Company, nor shall
it be assignable by operation of law by either party, without the prior
written consent of the other party. The parties' rights and obligations
under this Agreement will bind and inure to the benefit of their respective
successors, heirs, executors, and administrators and permitted assigns.
10. LEGAL AND EQUITABLE REMEDIES. Consultant hereby acknowledges and
agrees that in the event of any breach of this Agreement by Consultant,
including, without limitation, the actual or threatened disclosure of
Information or Service Product without the prior express written consent of
the Company, the Company will suffer an irreparable injury, such that no
remedy at law will afford it adequate protection against, or appropriate
compensation for, such injury. Accordingly, Consultant hereby agrees that the
Company shall be entitled to specific performance of Consultant's obligations
under this Agreement, as well as such further relief as may be granted by a
court of competent jurisdiction.
11. GOVERNING LAW; SEVERABILITY. This Agreement shall be governed by
and construed according to the laws of the State of California. If any
provision of this Agreement is found by a court of competent jurisdiction to
be unenforceable, that provision shall be severed and the remainder of this
Agreement shall continue in full force and effect.
12. WAIVER. The waiver by the Company of a breach of any provision of
this Agreement by Consultant shall not operate or be construed as a waiver of
any other or subsequent breach by Consultant.
13. INJUNCTIVE RELIEF FOR BREACH. Consultant's obligations under this
Agreement are of a unique character that gives them particular value; breach of
any of such obligations will result in irreparable and continuing damage to the
Company for which there will be no adequate remedy at law; and, in the event of
such breach, the Company will be entitled to injunctive relief
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and/or a decree for specific performance, and such other and further relief
as may be proper (including monetary damages if appropriate).
14. COMPLETE UNDERSTANDING; MODIFICATION. This Agreement, together
with its Exhibits, constitutes the final, exclusive and complete
understanding and agreement of the Company and Consultant with respect to the
subject matter hereof. Any waiver, modification or amendment of any
provision of this Agreement shall be effective only if in writing and signed
by a Company officer.
15. NOTICES. Any notices required or permitted hereunder shall be
given to the appropriate party at the address specified below or at such
other address as the party shall specify in writing. Such notice shall be
deemed given upon personal delivery to the appropriate address or sent by
certified or registered mail, three days after the date of mailing.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first set forth above.
ASK JEEVES, INC. THE RODA GROUP, L.L.C.
By: /s/ Robert Wrubel By: /s/ Roger Strauch
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Title: Chief Executive Officer Title: Managing Member
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Address: 918 Parker Street Address: 918 Parker Street
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Berkeley, CA 94710 Berkeley, CA 94710
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ROGER STRAUCH
/s/ Roger Strauch
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DANIEL MILLER
/s/ Daniel Miller
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EXHIBIT A
SERVICES
Nature of Services:
General management services, as approved by CEO and board of directors.
General business development services, as approved by CEO and board of
directors.
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EXHIBIT B
NONSTATUTORY STOCK OPTION
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