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EXHIBIT
10.1
MANAGEMENT
CONSULTING AGREEMENT
This
Management Consulting Agreement (the “Agreement”) is made as of October 22,
2007, by and between Robert W. Hagger (“Hagger”) and Datawatch
Corporation (the “Company”).
WHEREAS,
Hagger is the
President and Chief Executive Officer (the “CEO”) of the Company;
and
WHEREAS,
the Company and Hagger desire to provide for consulting services relating to
the
transition from Hagger to the Company’s newly elected President and CEO (the
“New CEO”) effective January 1, 2008;
NOW,
THEREFORE, in consideration of the foregoing and the agreements herein
contained, and intending to be legally bound, the parties hereby agree as
follows:
1. Continuation
as CEO. Hagger agrees to continue to serve as the CEO of the
Company from the date of this Agreement until December 31, 2007 (the “Interim
Period”), unless earlier terminated as specified in Section 5. During
this period, Hagger shall devote substantially all of his business time,
attention and energies to the Company’s business and shall not engage in any
other business activity without the Board of Directors’ approval. As
of January 1, 2008, or earlier, upon either the termination of Hagger’s
employment by the Company without Cause (as defined herein) or by Hagger for
Good Reason (as defined herein), the Company will reimburse Hagger for
relocation expenses in connection with his relocation to Europe in accordance
with the Company’s relocation policy, in an amount not to exceed
$30,000. The date of January 1, 2008 is referred to herein as the
“Transition Date.”
2. Consulting
Services. Unless the relationship is earlier terminated as
provided in Section 6 hereof, for a period of 12 months after the Transition
Date (the “Consulting Period”), Hagger or, at his option, a corporation or other
entity of which Hagger is an employee or principal (the “Consulting Company”)
(Hagger or the Consulting Company, as the case may be, in their role as
consultant each are hereinafter referred to as the “Consultant”), will provide
consulting services to the Company as provided herein. Consultant
will be available as reasonably requested by the Company, to provide such
services and duties as the Company reasonably requests, with respect to
training, advice and assistance to the Company and the New CEO in the transition
to the position of Chief Executive Officer for the Company. The
issues on which Consultant may be requested to provide training, advice and
assistance include SEC rules, regulations, filings and compliance, investor
relations, banking facilities, the status of customer contracts and general
business advice. Consultant will determine his own hours and method
of performing the consulting services; he may perform the services from any
location; he will generally use his own tools and equipment; and he will not
be
supervised or controlled in the performance of his tasks by the
Company. Consultant agrees to perform his consulting services well
and faithfully and to the best of his ability. Consultant agrees to
take no action prejudicial to the interests of the Company during the Consulting
Period.
3. Consulting
Fee. As compensation for the provision of consulting services
hereunder, the Company shall pay a consulting fee to Consultant during the
Consulting Period on a monthly basis at the rate of $25,000 per
month. In addition, Consultant will be reimbursed by the Company for
all reasonable and properly documented expenses incurred in connection with
providing the consulting services, subject to the approval of the New CEO and
in
accordance with the Company’s expense reimbursement policies. Other
than as set forth in this Agreement or as otherwise required by law, neither
Hagger nor the Consultant will be entitled to any other benefit or compensation
in connection with the termination of Hagger’s employment by the Company or the
performance of the consulting services hereunder.
4. Independent
Contractor Relationship. The parties expressly understand and
agree that, during the Consulting Period, Consultant’s status in relation to the
Company will be that of an independent contractor, and that neither this
Agreement nor the services to be rendered hereunder by Consultant will for
any
purpose whatsoever create an employment relationship between the
parties. Consultant will have exclusive responsibility for payment of
all federal, state, and local income taxes, as well as all unemployment and
disability insurance, social security, and other taxes, applicable to the
compensation to be provided to him hereunder by the
Company. Consultant acknowledges that he will not receive any
employee benefits from the Company, and that, as an independent contractor,
Consultant will have exclusive responsibility to obtain and make payment for
health insurance, life insurance, and any other benefits that he wishes to
receive. Further, Consultant agrees that, except as specifically
authorized by the Company, he will not seek to bind the Company under any
contract or other obligation.
5. Termination
of Employment. During the Interim Period, Hagger’s employment may be
terminated at any time by the Company, either with or without Cause (as defined
herein), or by Hagger, either with or without Good Reason (as defined
herein). In the event of the termination of Hagger’s employment by
the Company for Cause, Hagger’s resignation from employment without Good Reason,
or his death or Disability (as defined herein), in each case prior to the
commencement of the Consulting Period, this Agreement shall immediately and
automatically terminate and the Company shall have no further obligations to
Hagger hereunder. For purposes of this Agreement, “Cause”
shall mean Hagger (i) engaging in willful and repeated gross negligence
or gross
misconduct, (ii) breaching a material fiduciary duty to the Company or
(iii) being convicted of a felony, in any such case, to the demonstrable and
material injury to the Company. For purposes hereof, no act, or
failure to act, on Hagger’s part, shall be deemed “willful” unless done, or
omitted to be done, by Hagger not in good faith and without reasonable belief
that any act or omission was in the best interest of the Company. For
purposes of this Agreement, Hagger’s termination of his employment by the
Company will be considered for “Good Reason” if he terminates upon the
occurrence of any one or more of the following events: (i) a
reduction in his base salary; (ii) a substantial reduction in his benefits
without a similar reduction of the benefits of the other executive officers
of
the Company; or (iii) without his express written consent, his assignment
to duties substantially inconsistent with his current position with the Company
or a substantial reduction in his duties other than in connection with the
employment of the New CEO. For the purposes of this Agreement,
“Disability” shall mean any physical incapacity or mental incompetence
(i) as a result of which Hagger is unable to perform the essential functions
of
his position as CEO for an aggregate of 90 days, whether or not
consecutive, during any calendar year, and (ii) which cannot be reasonably
accommodated by the Company without undue hardship.
6. Termination
of Consulting Arrangement. In the event, after the commencement
of the Consulting Period, of the Consultant’s material breach of any term of
this Agreement, or Hagger’s death or Disability (as defined herein), this
Agreement shall immediately and automatically terminate and the Company shall
have no further obligations to the Consultant.
7. Other
Agreements. Hagger understands and agrees that he remains subject
to the Proprietary Information and Inventions Agreement, dated August 21, 2001,
which remains in full force and effect. The parties agree that the
Employment Agreement between the Company and Hagger dated as of July 9, 2001
has
expired by its terms and that all provisions of the Employment Agreement,
including without limitation the provisions relating to the payment of severa
