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Ask Jeeves / Roda Group - Consulting Services Agreement (includes grant of options)
CONSULTING SERVICES AGREEMENT
THIS CONS
ULTING 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.
WHEREAS, the Company desires Consultant's services with respect to the management, operations and business development of the Company, and Consultant agr
ees 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) PROFE
SSIONAL 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 perfor
med 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 emp
loyee benefits, nor will the Company make deductions from any amounts payable to Consultant for taxes or insurance. All payroll and
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
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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 S
ubsequent 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 Con
sultant (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
o
f 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 inte
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ded 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 li
mitations 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 unde
r 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 o
n 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).
(d) The Company shall reimburse Consultant for expenses actually incurred by Consultant in performing the Services, i
ncluding 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 su
bmit 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 thi
rd 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, developm
e
nts, 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 li
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ts; (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 confiden
tial 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 writte
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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
information or trade secrets of his or he...
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