EXHIBIT 10.47
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT (the "Agreement") is made and entered into as of
this 1st day of August, 2001 ("Effective Date") by and between Jayne &
Associates, a California corporation ("Consultant"), and Universal Electronics
Inc., a Delaware Corporation ("UEI").
RECITALS
(A) UEI is engaged in the business of (i) developing software and building
and marketing pre-programmed, easy-to-use wireless control devices and chips
principally for home entertainment equipment and the subscription broadcast
market, including without limitation, remote control devices, combination
keyboard/remotes and touch-screen remotes, (ii) licensing its patented
technologies and database of infrared codes to companies selling into the cable
and satellite industries and to original equipment manufacturers and (iii)
selling its universal remote control products to distributors and retailers in
Europe, Asia, South America and Australia under the One For All(R) brand name
("UEI Business").
(B) Consultant's President and Chief Executive Officer, Camille Jayne
("C.J.") was UEI's former Executive Chairman of the Board and is a current
member of UEI's Board of Directors and has expertise in and has intimate
knowledge of UEI's Business.
(C) UEI and Consultant desire to agree on the availability of Consultant to
UEI for the rendition of consulting services by Consultant to UEI from and after
the Effective Date on the terms and conditions herein contained. It is not the
intention of the parties to restrict the activities of Consultant or C.J. in any
of its endeavors or enterprises as long as such activities are not directly
competitive with the UEI Business.
THEREFORE, the parties, intending to be legally bound, and for the good
and valuable consideration, the adequacy of which is hereby recognized by the
parties agree as follows:
1. INCORPORATION. The recitals set forth above and any Exhibits hereto are
incorporated herein by this reference.
2. DEFINITIONS.
(a) "Invention" shall mean any invention, discovery or improvement
(including, without limitation, any technology, test, concept, idea,
operation, product, process, method, formula, computer program or flowchart
or software or firmware, data bases, technique or improvement thereof),
related to a service or product of UEI being sold, developed or considered
and whether or not patentable, and all know-how related thereto.
(b) "Confidential Information" shall mean all information, whether
provided orally or in writing, relating to the UEI's Business that has
economic value and is not
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generally known to others, including, but not limited to, trade secrets,
proposed domain names, trade dress, software, know-how, costs, methods of
business operation, business plans, business and marketing concepts,
financial information, projections and data, sales information, profit data
and information regarding business partners, suppliers, vendors,
distributors, and customers.
(c) "Consulting Services" shall mean the services as defined in
Section 4.
(d) "Non-Solicitation Period" shall mean the time period during the
Term of this Agreement.
(e) "Work Product" shall mean information and works of authorship
fixed in any tangible medium that are created in the process of providing
Consulting Services to UEI hereunder or to the UEI Business, including, but
not limited to, Invention and Confidential Information.
3. TERM. This Agreement shall commence on the Effective Date and shall expire
on February 1, 2004, unless sooner terminated in accordance with the terms
hereof ("Term").
4. CONSULTING SERVICES. During the Term of this Agreement, Consultant shall
make itself available to advise and consult with UEI as to the potential move of
UEI's headquarters (the "Initial Project Assignment") and to perform those
services with respect to such other areas as may be agreed upon by UEI and
Consultant from time to time ("Consulting Services"). During the first six (6)
months of the Term of this Agreement Consultant shall render the Consulting
Services without regard to the number of hours, during the next twelve (12)
months of this Agreement Consultant shall render the Consulting Services for a
period of no less than thirty (30) hours per month and during the last twelve
(12) months of this Agreement Consultant shall render the Consulting Services
for a period of no less than twenty (20) hours and no more than thirty (30)
hours per month. The Consulting Services may be rendered to UEI from time to
time by telephone, letter or in person.
5. COMPENSATION. As full compensation for the availability of Consultant to
render Consulting Services and for the performance of all other obligations set
forth in subsection 7(b) and those subsections and Section listed in Section 12
herein, UEI shall pay to Consultant a fee in advance on the first day of each
month during the term of this Agreement equal to (a) US$33,333.33 each month
during the first six (6) months of this Agreement and (b) US$16,666.67 each
month during the remaining twenty-four (24) months of this Agreement. The fee
shall be paid each month as set forth herein so long as this Agreement has not
been terminated according to its terms.
6. REIMBURSEMENT FOR BUSINESS EXPENSES. All reasonable travel, office, and
other costs incurred by Consultant in connection with carrying out its
Consulting Services hereunder shall be reimbursed by UEI so long as such
expenses have been substantiated in accordance with reasonable commercial
accounting practices; provided however, that Consultant will not incur any
single expense in excess of US$1,000 without first obtaining UEI's approval.
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7. RESTRICTIVE COVENANTS.
(a) Consultant shall be responsible for all corporate and/or
individual taxes, fees, and licenses incurred in connection with rendering
Consulting Services hereunder and as otherwise incurred in connection with
conducting its business; and
(b) To protect the legitimate business interests of UEI from unfair
competition by Consultant or any of its employees, Consultant during the
Non-Solicitation Period, will not, directly or indirectly, (i) solicit or
endeavor to entice away from UEI any person, firm, company or corporation
that, on the date of this Agreement, was doing business with UEI and
accounted for ten percent (10%) or more of UEI's gross revenue as
determined by UEI's book and records and (ii) solicit for hire or hire as a
result of such solicitation, any key employee of Employer, except that
Consultant may hire any such key employee so long as such hiring was made
as a result of a general solicitation of employment through typical
solicitation means, such as advertisements and the like, or such
solicitation was initiated by such key employee; and
(c) Consultant shall return to UEI either before or immediately upon
the termination of this Agreement any and all written Confidential
Information or Work Product, that constitutes, contains or relates to UEI's
proprietary information, trade secrets and which relates to the UEI
Business which is in Consultant's possession, custody and control, whether
confidential or not, including any and all copies thereof which may have
been made by or for Consultant. Consultant shall maintain no copies thereof
after the termination of this Agreement.
8. PROTECTION OF CONFIDENTIAL INFORMATION. Consultant agrees with respect to
any Confidential Information received by it from UEI:
(a) to hold the Confidential Information in confidence and use it
only for the purposes authorized by UEI;
(b) to promptly return all Confidential Information received by
Consultant, regardless of media or form, to UEI at the request of UEI and
to retain no reproductions, copies, extracts or summaries of any
Confidential Information; and
(c) to promptly notify UEI if the Confidential Information is
required to be disclosed pursuant to any court or government action.
9. PROPRIETARY RIGHTS.
(a) Consultant recognizes that UEI's organization, the UEI Business
and UEI's relationships with customers, clients, perspective customers or
clients and others having business dealings with UEI are and will be the
sole property of UEI. UEI, however, likewise recognizes that Consultant may
render services to customers, clients and prospective
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customers and clients of UEI that are not competitive with UEI, and that in
those situations, such customers, clients and others having business dealings
with Consultant will be the sole property of Consultant.
(b) Consultant understands that all technologies, processes and research
that was or is developed by UEI, or Consultant rendering Consulting Services to
UEI with respect to the UEI Business is the sole property of UEI. Therefore,
subject to subsection 9(c) below with respect to all Inventions and Work Product
made or conceived by Consultant, whether or not during the hours of its
consulting services conducted hereunder or with the use of UEI facilities,
materials or personnel, either solely or jointly with others, during the term of
this Agreement, and without royalty or any other consideration, Consultant
hereby assigns all Inventions and Work Product to UEI and agrees to do the
following:
(i) Communicate to UEI promptly and fully all Inventions made or
conceived by Consultant (whether made or conceived solely by Consultant or
jointly with others) during the term of this Agreement that (1) relate to
the business, work or investigations of UEI or of any companies that it
owns or controls at the time the Inventions are created, (2) result from or
are suggested by any work that Consultant has done or made for or on behalf
of UEI, or (3) are developed, tested, improved or investigated either in
part or entirely on time for which Consultant was paid by UEI or using any
funds, equipment, laboratories or other facilities of UEI.
(ii) Consultant shall without charge to UEI, at the request and
expense of UEI, execute, acknowledge, and deliver any and all papers,
including patent applications, and copyright applications, assignments, and
applications for reissue, and do all other lawful acts, including the
giving of testimony in proceedings in which Inventions may be involved or
concerned, that UEI may consider necessary or proper to secure to UEI the
fullest right to the Inventions and to patents and to copyright
registrations in the United States and/or foreign countries covering the
same, and to bring about the full protection of the same. Consultant agrees
to perform the above-specified acts whether or not this Agreement is in
force at the time UEI requests Consultant's performance.
(iii) In the event UEI is unable for any reason whatsoever to secure
Consultant's signature to any lawful and necessary documents required to
apply for, or to prosecute, any United States or foreign applications for a
patent or copyright registration, Consultant hereby irrevocably designates
and appoints UEI and its duly authorized officers and agents as its agent
and attorney in fact, to act for and, in its behalf, to execute and file
any said application and to do all other lawfully-permitted acts to further
the prosection and issuance of a patent or copyright registration based
thereon. Consultant hereby waives and quitclaims to UEI any and all claims,
of any nature whatsoever, that Consultant may now have or may hereafter
have for infringement of any patent(s) or copyright registration(s) from
any said application.
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(c) The foregoing notwithstanding, this Section 9 shall not apply to
any inventions of Consultant for which no equipment, supplies, facility,
Confidential Information or trade secret information of UEI was used and
that was developed on Consultant's own time, unless (i) the invention
directly involves (1) the UEI Business or (2) UEI's actual or demonstrably
anticipated research or development, or (ii) the invention results from any
work performed by Consultant for UEI that relates directly to the UEI
Business.
10. INDEMNITY.
(a) Consultant shall defend, indemnify and hold harmless UEI and its
corporate affiliates from and against all losses, damages, expenses
(including attorney's fees and costs), claims, suits and liabilities,
whether based in contract or tort, to the extent that such losses, damages,
expenses, claims, suits, and liabilities arise out of or in connection with
(i) Consultant's negligent or intentional acts or omissions, or those of
persons furnished by it, (ii) the failure of Consultant or any of its
employees or contractors to fully comply with the terms of this Agreement,
or (iii) assertions under Worker's Compensation or similar laws made by
persons furnished by Consultant. UEI shall promptly notify Consultant of
any written claim, loss, or demand for which Consultant is responsible
under this Clause.
(b) UEI shall defend, indemnify and hold harmless Consultant and its
corporate affiliates from and against all losses, damages, expenses
(including attorney's fees and costs), claims, suits and liabilities,
whether based in contract or tort, to the extent that such losses, damages,
expenses, claims, suits, and liabilities arise out of or in connection with
(i) UEI's negligent or intentional acts or omissions, or those of persons
furnished by it, (ii) the failure of UEI or any of its employees or
contractors to fully comply with the terms of this Agreement, or (iii)
demands, assertions and claims of all third parties and vendors rendering
services to UEI even though arranged or coordinated by Consultant for UEI
as part of the Consulting Services provided hereunder, provided that
Consultant shall not engage any third party or vendor in violation of
Section 17, the doing so shall render this indemnification as set forth in
this subsection 10(b)(iii) null and void.
11. TERMINATION.
(a) This Agreement shall commence on the date hereof and shall
terminate automatically at the end of the Term.
(b) Notwithstanding the provisions of subsection 11(a) above, UEI
shall have the right to terminate this Agreement by delivering to the
Consultant written notice of termination in the event (i) of any attempted
transfer or assignment by Consultant of (1) the entire Agreement or (2) any
right or obligation of Consultant hereunder without the prior written
consent of UEI, (ii) of the unavailability of Consultant as is required by
Paragraph 4 herein, (iii) if Consultant violates any provision of this
Agreement, or (iv) if C.J ceases being involved in the day to day
activities of Consultant ("Termination Notice"). Consultant
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shall have ten (10) working days to cure any default or breach of this
Agreement, which must be specified in the Termination Notice.
(c) Upon termination of this Agreement, Consultant shall return to
UEI promptly and without charge any materials provided to the Consultant by
UEI.
12. SURVIVAL. Subsections 7(a), 7(c), 9(b)(i), 9(b)(ii), 9(b)(iii) and 11(c)
and Sections 8, 10, 13, 17, 23 and 26 shall survive the termination of this
Agreement.
13. REMEDIES. Consultant acknowledges that the covenants and agreements that it
has made in this Agreement are reasonable and are required for the reasonable
protection of the UEI Business and its goodwill. UEI and its subsidiaries,
successors and assigns will be entitled to seek specific performance by
Consultant of Consultant's obligations hereunder and to seek to enjoin
Consultant from engaging in any activity in violation hereof. UEI, Consultant
and any of their respective subsidiaries, successors or assigns shall be
entitled to recover all costs of successfully enforcing any provision of this
Agreement, including reasonable attorneys' fees and costs of litigation and any
interest.
14. PARTIAL INVALIDITY. The various covenants and provisions of this Agreement
are intended to be severable and to constitute independent and distinct binding
obligations of the parties hereto. Should any covenant or provision of this
Agreement be determined to be unenforceable, in whole or in part, it shall not
be deemed to affect or impair the validity of any other covenant or provision or
part thereof. If the scope of any covenant, provision or part thereof contained
in this Agreement is too broad to permit enforcement to its full extent, this
covenant, provision or part thereof shall be enforced to the maximum extent
permitted by law, and the parties hereto hereby agree that such scope may be
judicially modified accordingly.
15. ASSIGNMENT. Consultant agrees that this Agreement may be assigned by UEI in
its entirety to any entity controlled by, or under direct or indirect common
control with, UEI and to any entity to whom UEI sells its business or assets,
and that upon any such assignment, such assignee shall acquire all of UEI's
rights and obligations under this Agreement, including without limitation the
right of assignment set out in this Section 15 provided, that such successor
specifically assumes the obligations of UEI in writing in form and substance
reasonably satisfactory to Consultant. The rights and obligations of Consultant
hereunder may not be assigned or delegated without the prior written consent of
UEI.
16. NO STRICT CONSTRUCTION. The language used in this Agreement will be deemed
to be the language chosen by the parties hereto to express their mutual intent,
and no rule of strict construction will be applied against any party hereto.
17. RELATIONSHIP OF THE PARTIES. None of the provisions of this Agreement shall
be deemed to constitute an agency or employment relationship or partnership or
joint venture between each of Consultant and UEI and neither Consultant nor UEI
shall have any authority to bind the other in any way. Accordingly, the parties
agree to the following:
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(a) Consultant shall not be required to participate actively in the
day to day operations of UEI.
(b) It is expressly understood that in furnishing the Consulting
Services, neither Consultant nor any of its employees shall be an employee
of UEI. Consultant shall act solely as an independent contractor.
Accordingly UEI will not supervise or control the manner in which
Consultant performs the Consulting Services.
(c) Consultant shall be fully responsible and liable for all acts and
omissions of Consultant's employees and agents. UEI shall be fully
responsible and liable for all acts and omissions of UEI's employees and
agents.
(d) Neither Consultant nor any of its employees or agents shall make
any representation that it, she or he is an agent or representative of UEI
or is otherwise authorized to act for or on behalf of UEI and agrees not to
create any obligation or to assume any responsibility for UEI or attempt to
bind UEI in any manner whatsoever.
(e) Consultant shall indemnify and hold UEI harmless with respect to
any taxes, penalties or interest claimed by any taxing authority for
failure to withhold any income taxes from the payments to Consultant
provided for under this Agreement.
18. NOTICE. Any notice or other communication required or permitted to be given
hereunder shall be in writing and shall be deemed to have been duly given to any
party (a) upon delivery to the address of such party specified below if
delivered in person or by courier, or if sent by certified or registered mail
(return receipt requested), postage prepaid; (b) upon dispatch if transmitted by
telecopy or other means of facsimile, in any case to the parties at the
following address(es) or telecopy number(s), as the case may be:
If to Consultant:
Jayne & Associates
5 New Dawn
Irvine, CA 92620
Facsimile No.: (714) 734-7726
Telephone No.: (714) 734-7725
With a required copy to:
Robert L. Young
Law Offices of Robert L. Young
Two Walnut Creek Center
200 Pringle Avenue, Suite 340
Facsimile No.: (925) 196-3399
Telephone No.: (925) 906-9898
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If to UEI:
Paul D. Arling
Chief Executive Officer
Universal Electronics Inc.
6101 Gateway Drive
Cypress, California 90630
Facsimile No.: (714) 820-1010
Telephone No.: (714) 820-1000
With a required copy to:
Richard A. Firehammer, Jr.
Sr. Vice President and General Counsel
Universal Electronics Inc.
8190 Carrington Place
Bainbridge Township, Ohio 44023
Facsimile No.: (440) 708-0721
Telephone No.: (440) 708-0720
or to such address(es) or telecopy number(s) as any party may designate by
written notice in the aforesaid manner.
19. NONEXCLUSIVITY. This Agreement does not grant to Consultant any exclusive
right or privilege to provide Consulting Services to UEI of the type
contemplated herein, and UEI reserves the right to contract with other parties
for the procurement of comparable services.
20. WAIVER OF BREACH. The waiver by any party hereto of a breach of any
provision of this Agreement by any other party shall not operate or be construed
as a waiver of any subsequent breach.
21. ENTIRE UNDERSTANDING. This Agreement and the agreements referred to herein
constitute the entire understanding between the parties hereto with regard to
the subject matter hereof and shall not be changed, altered, modified or
discharged, except in writing consented to by all parties.
22. BINDING EFFECT. This Agreement shall be binding upon the administrators,
legal representatives, and successors and permitted assigns of Consultant and
UEI.
23. GOVERNING LAW. This Agreement shall be construed and enforced in accordance
with the laws of the State of California, without regard to that state's
conflict of laws provisions.
24. COUNTERPARTS. This Agreement shall be executed in several counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one in the same agreement.
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25. AUTHORITY. Each individual signing this Agreement warrants and represents
that the individual has full power and proper authority to sign this Agreement
and to bind the Party for which the individual purports to act.
26. VENUE AND JURISDICTION. The parties agree that all actions arising directly
or indirectly as a result or in consequence of this Agreement, shall be
instituted and litigated only in state and local courts in California, or the
federal courts for the Southern District of California, and each of the parties
hereby consents to the exclusive jurisdiction and venue of any such court, and
waives any objection based on forum nonconveniens.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
first above written.
CONSULTANT: UEI:
JAYNE & ASSOCIATES UNIVERSAL ELECTRONICS INC.
By: /s/ CAMILLE JAYNE 7-17-01 By: /s/ PAUL D. ARLING
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Camille Jayne, President and Paul D. Arling, Chief Executive Officer
Chief Executive Officer
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