EXHIBIT 10.3
AMENDMENT NO. 1 TO
CONSULTING AGREEMENT
This Amendment No. 1 (this "Amendment") is entered into as of November 19,
1998, between DATA RACE, Inc., a Texas corporation (the "Company"); and Liviakis
Financial Communications, Inc., a California corporation ("Consultant").
RECITALS
WHEREAS, the Company and Consultant are parties to that certain Consulting
Agreement dated July 13, 1998 (the "Agreement"); and
WHEREAS, the Company and Consultant desire to extend the term and modify
certain provisions of the Agreement.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties to this Amendment
agree as follows:
AGREEMENT
1. Unless the context requires otherwise, capitalized terms used, but not
defined herein, shall have the applicable meanings given to them in the
Agreement.
2. The parties agree to amend the term of the Agreement, extending the
expiration date of the Agreement to January 1, 2000 from March 15,
1999. As amended, Section 1 of the Agreement will read as follows:
"1. Term of Consultancy. Company hereby agrees to retain the Consultant
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to act in a consulting capacity to the Company, and the Consultant hereby
agrees to provide services to the Company commencing immediately and ending
on January 1, 2000. The Agreement may be terminated by the Company with a
written notice of such desire to terminate the Agreement."
3. The Company agrees to issue and deliver to Consultant 200,000 shares
(the "Extension Bonus") of the Company's common stock ("Common Stock"),
provided that such issuance is contingent upon an increase in number of
the Company's authorized shares of Common Stock at the special meeting
of the Company's shareholders scheduled to be held on or about January
15, 1999.
4. The parties agree that, except as provided herein, the shares issued
as the Extension Bonus are treated as shares issued as part of the
"Commencement Bonus" for purposes of the Agreement. Without limiting
the foregoing (i) the Company acknowledges that the Bonus Shares are a
nonrefundable, non-
apportionable, and non-ratable retainer and that such shares are
not a prepayment for future services and (ii) the Consultant
reaffirms the representations, warranties and covenants contained
in Sections 4.2 and 4.3 of the Agreement.
5. Company agrees that the shares issued as Additional Bonus will
carry piggy-back registration rights whereby such shares will be
included in the next resale registration statement filed under the
Securities Act of 1933, as amended (the "Securities Act") after the
issuance of the shares.
6. Notwithstanding Section 5 above, the Company agrees to file a
resale registration statement covering the shares issued as
Additional Bonus under the Securities Act no later than October 31,
1999.
7. Consultant agrees that it shall not sell or transfer any of the
shares issued as the Commencement Bonus (including the Extension
Bonus) during the term of the Agreement, as extended. Robert B.
Prag ("Prag") also agrees that he will not sell or transfer any of
the shares issued to him as a Commencement Bonus during the term of
the Agreement, as extended, as long as he is an officer and/or
director of the Consultant. Notwithstanding the preceding sentence,
Prag may sell or transfer, subject to compliance with applicable
securities laws, any of the shares issued to him as a Commencement
Bonus beginning on, but not prior to, March 16, 1999, provided that
he is no longer an officer or director of the Consultant at the
time of such transfer or sale.
8. The Agreement, as modified by this Amendment, sets forth the entire
understanding between the parties hereto concerning the subject
matter contained herein and, except as specifically modified
herein, all other provisions of the Agreement are hereby ratified
and affirmed. Provisions of the Agreement may be amended or waived
only by written instrument executed by the party against whom
enforcement is sought. The parties agree to execute such additional
documents and take such additional actions as may be reasonably
necessary to give effect to the purposes and the intent of the
Agreement, as modified by this Amendment.
9. This Amendment may be executed in one or more counterparts, any of
which shall be deemed to be an original, all of which taken
together shall constitute one and the same instrument.
[signatures on following page]
IN WITNESS WHEREOF, each party has duly executed this Amendment as of the
date first written above.
COMPANY CONSULTANT
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DATA RACE, INC. LIVIAKIS FINANCIAL COMMUNICATIONS INC.
By: /s/ Gregory T. Skalla By: /s/ John M. Liviakis
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Gregory T. Skalla, Senior Vice John M. Liviakis
President-Financeand Chief Presidnet
Financial Officer