CONSULTING AND CONFIDENTIALITY AGREEMENT
THIS CONSULTING AND CONFIDENTIALITY AGREEMENT (the “Agreement”), dated as of April 15, 2011, is made and entered into by and between Integral Technologies, Inc., a Nevada corporation, (the “Company” or “Integral”) and Herbert C. Reedman, Jr., individually, (the “Consultant”).
WHEREAS, the Company desires to engage Consultant to provide certain consulting services as the Company may direct; and
WHEREAS, the Consultant is willing to be engaged by the Company as a consultant and to provide such services in assisting in the commercialization of Integral’s ElectriPlast™ and other technologies.
NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. Consulting . The Company hereby retains Consultant, and Consultant hereby agrees to be available as a consultant to the Company, upon the terms and subject to the conditions contained herein. During the Consultant Term (as hereinafter defined), Consultant shall provide certain consulting services to the Company as requested by management.
2. Term . Subject to the provisions for termination hereinafter provided, the term of this Agreement shall commence on the date set forth above (the “Effective Date”) and shall continue until March 14, 2014 (the “Consultant Term”).
3. Compensation . In consideration of the Services (as hereafter defined) to be rendered by Consultant hereunder, during the Consultant Term the Company shall pay and grant to Consultant, and Consultant agrees to accept the following:
(a) As a consulting fee, $14,000 per month (the “ Consulting Fee” ) payable at the beginning of each month. The decision on whether the Consulting Fee will be increased will be at the sole discretion of the Company. The Company shall pay the Consulting Fee to the Consultant without offset, deduction or withholding of any kind or for any purpose. The Consultant shall pay any and all taxes, including, federal, state and local taxes, incurred by him with respect to the Consulting Fee. The consultant agrees to delay payment until such time as the Company secures financing satisfactory to the Board of Directors.
(b) On the execution of this Agreement, the amount of 150,000 common shares of the Company and, on the six-month anniversary of the execution of this Agreement, an additional 100,000 common shares of the Company, all duly issued.
(c) On the execution of this Agreement, the Company shall grant to Consultant 600,000 options for the right to purchase common stock of the Company. The Grant of Option forms part of this Agreement and is attached as Exhibit A. These options shall be priced and vested pursuant to the Grant of Option and as indicated below.
(d) On the first year anniversary of the execution of this Agreement the Company shall grant to Consultant 1,250,000 options for the right to purchase common stock of the Company. The Grant of Option forms part of this Agreement and is attached as Exhibit A. These options shall be priced and vested pursuant to the Grant of Option and as indicated below.
(e) The consideration to be given by Consultant for the Consulting Fee, the issue of common stock and the Grant of Options shall include the following services (the “Services”) over the Consultant Term: Consultant’s Services shall consist of those duties and responsibilities as may be established and directed by the management of the Company. The Company and the Consultant intend that the Services shall be rendered primarily from the Consultant's office in Pennsylvania and may be provided in person at meetings or via telephone or e-mail or other written communications.
4. Termination .
(a) The Consultant Term will end on April 15, 2014 (the “ Expiration Date ”), unless sooner terminated (i) by the death of Herbert C. Reedman, Jr. or upon Notice of Termination (as defined below) delivered to Consultant as a result of his Disability (as defined in Section 4(f) below), (ii) by the Company at any time prior to the Expiration Date for Cause (as defined in Section 4(d) below), or (iii) by the Consultant for material breach of this Agreement by the Company, which is not cured after 30 days’ written notice of such breach by Consultant to Company. Any termination of the Consultant Term by the Company or by Consultant (other than termination upon Herbert C. Reedman, Jr.’s death or for breach by the Company) must be communicated by written “ Notice of Termination ” to the other party hereto. “ Termination Date ” means (i) if the Consultant Term has not already been terminated by such date, the Expiration Date, (ii) if the Consultant Term is terminated by Herbert C. Reedman, Jr.’s death, the date of Herbert C. Reedman, Jr.’s death, (iii) if the Consultant Term is terminated upon Herbert C. Reedman, Jr.’s Disability, by the Company, the date specified in the Notice of Termination, (iv) if the Consultant Term is terminated by the Company for Cause, upon receipt of Notice of Termination by Herbert C. Reedman, Jr.; (v) if the Consultant Term is terminated by Herbert C. Reedman, Jr., upon the expiration of 30 days following receipt by the Company of written notice of a breach that has not been cured by the Company within such period.
(b) If the Consultant Term is terminated by the Company for Cause, the Company will pay Consultant only those amounts due as identified in paragraph 3(a), prorated, to the Termination Date and any unpaid expenses as of the Termination Date. Upon delivery of the payment described in this Section 4(b), the Company will have no further obligation to Consultant under this Agreement. Consultant shall retain all vested stock options granted him as of the Date of Termination.
(c) If Consultant Term is terminated by the Consultant under paragraph 4(a) for material breach of this Agreement by the Company, the Company will pay Consultant the full amount of the remaining compensation for the entire Consultant Term as identified in Section 3(a) as compensation payments become due monthly, plus all unpaid expenses as of the Termination Date. Consultant shall retain all vested stock options granted him as of the Date of Termination.
(d) “Cause” means any one of the following: (i) a material breach by Consultant of this Agreement, (ii) Consultant’s conviction of, guilty plea to, or confession of guilt of, a felony, but expressly excluding misdemeanor traffic violations, (iii) fraudulent, dishonest or illegal conduct, gross negligence or willful misconduct by Consultant in the performance of Services for or on behalf of the Company or any of its subsidiaries or any other conduct detrimental to the business, operations or reputation of the Company or any of its subsidiaries as determined by the Company’s board of directors (the “Board”) in good faith, regardless of whether such conduct is within the scope of Consultant’s duties, (iv) Consultant’s misappropriation of funds, (v) Consultant engaging in conduct involving an act of moral turpitude, (vi) failure to comply with the directions of the Board, provided that such directions are reasonable, lawful, and consistent with Consultant’s duties and responsibilities hereunder, (vii) Consultant’s failure to perform in any material respect all of Consultant’s obligations and duties pursuant to this Agreement, (viii) Consultant’s failure to achieve performance and other goals established by the Board in good faith from time to time (except where such failure results from extraordinary circumstances outside of Consultant’s control (i.e. force majeure ).
(e) “Disability” means any accident, sickness, incapacity or other physical or mental disability which prevents Herbert C. Reedman, Jr. from performing substantially all of the duties Consultant has been assigned by the management of the Company or any of its subsidiaries for either (i) 30 consecutive days or (ii) 30 days during any period of 365 consecutive days, in each case as determined in good faith by the Board.
5. Reimbursement. The Company will reimburse Consultant for all reasonable out-of-pocket expenses incurred in connection with this Agreement..
6. Confidential Information . Forming part of this Agreement as Exhibit B, and to be executed by the Company and Herbert C. Reedman, Jr., is the Company’s standard Non-Disclosure Agreement.
7. Independent Contractor . It is understood and agreed that this Agreement does not create any relationship of association, partnership or joint venture between the parties, nor constitute either party as the agent or legal representative of the other for any purpose whatsoever; and the relationship of Consultant to the Company for all purposes shall be one