AMENDED AND RESTATED

CONSULTING AGREEMENT

 

THIS AMENDED AND RESTATED CONSULTING AGREEMENT (this “Agreement”) is entered
into as of February 1, 2008 (the “Effective Date”), by and between Vyyo Inc., a
Delaware corporation having its principal place of business at 6625 The Corners
Parkway, Suite 100, Norcross, Georgia 30092 (collectively with its subsidiaries
and affiliates, the “Company”), and James A. Chiddix, an individual 
(“Consultant”) (collectively the “Parties” and individually a “Party”).

 

1.             Services.

 

                a.             Scope of Services.  During the Term (as defined
below) of this Agreement, Consultant shall provide services to the Company as
described on Exhibit A for on average 40 hours each calendar month (the
“Services”).  The parties acknowledge that Consultant shall have the discretion
to determine the timing of when Services will be performed, but Consultant’s
exercise of such discretion shall take into account the Company’s needs.  The
parties further acknowledge that Consultant shall be entitled to take vacations
for reasonable periods from time-to-time. Consultant shall perform the Services
in a careful, professional and workmanlike manner and to the best of
Consultant’s ability.  The parties may mutually agree to adjust the scope of the
Services and Consultant agrees to use its reasonable efforts to accommodate any
such change in the scope of the Services.  If in the performance of his Services
hereunder, Consultant is spending over the course of six months on average more
than 40 hours per week, the parties shall mutually agree to discuss in good
faith and modify the compensatory terms of this Agreement.  This Agreement
governs the terms and conditions of Consultant’s Services to the Company as set
forth in this Agreement and does not affect, and is otherwise unrelated to,
Consultant’s membership on the Company’s Board of Directors, if applicable.

 

                b.             Loyalty.  Without limiting the other terms of
this Agreement, Consultant agrees that Consultant will not use any of the
Company’s proprietary information provided under this Agreement or in connection
with the provision of Services, to compete with the Company or its products.  In
addition, Consultant agrees that at all times during the term of this Agreement
he shall act in the best interests of the Company.

 

2.             Independent Contractor.  It is understood and agreed, and it is
the intention of the Parties, that Consultant is an independent contractor, and
not the employee, agent, joint venturer or partner of the Company for any
purposes whatsoever.  Consultant is not entitled to participate in any plans,
arrangements or distributions pertaining to any employee benefits of the
Company’s employees.    Consultant shall be entirely and solely responsible for
his acts while engaged in the performance of Services hereunder, and shall have
no right, power or authority to create any obligation, express or implied, on
behalf of the Company.

 

 

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3.             Compensation.

 

a.             Fees.  During the Term, the Company shall pay Consultant Seven
Thousand Five Hundred Dollars ($7,500) per month, in accordance with the
Company’s normal payroll practices.

 

b.             Stock Option Grant.  The Company shall grant Consultant an option
to purchase 250,000 shares of the Company’s Common Stock at the fair market
value of the Company’s Common Stock on the date of grant (the “Stock Option”). 
The Stock Option will be governed by the Company’s Third Amended and Restated
2000 Employee and Consultant Equity Incentive Plan and Consultant’s individual
option agreement.  Unless accelerated as provided in Section 4 (“Acceleration
Benefits”) below or in Section 5(c) (“Effect of  Termination”) below, the Stock
Option will vest in equal monthly installments over 48 months, beginning on
April 20, 2007, subject to continued consultancy.  If there is any conflict
between this Agreement and the terms of the option agreement, the terms of this
Agreement will control.

 

c.             Expenses.  Consultant shall use his best business judgment when
incurring expenses and shall respond in good faith to any future request by the
Company that Consultant obtain prior approval of such expenses where the
circumstances dictate.  Consultant shall be reimbursed for all reasonable and
necessary expenses incurred in performing the Services. Reimbursable expenses
shall be invoiced to the Company on a monthly basis, together with all
supporting documentation required by the Company.  All such expenses shall be
billed at Consultant’s actual out-of-pocket cost, without surcharge.  The
Company shall reimburse such expenses within 30 days of its receipt of
Consultant’s invoice and sufficient documentation.

 

d.             Taxes.  Consultant shall be responsible for the payment of all
applicable taxes, including, but not limited to, federal income tax, employment
taxes and any other taxes and shall indemnify the Company for the same.  In the
event the Company is required, or deems it appropriate, to withhold applicable
taxes, Consultant shall receive payment net of such withheld taxes.

 

                4.             Acceleration Benefits.

 

                                a.             Financing Event.  If the Company
is a party to a Financing Event (defined below), and the Company’s Board of
Directors or Audit Committee, as applicable, determines that Consultant
contributed in a material way to the Financing Event, then the following number
of Stock Options will vest:  (i) if the closing of the Financing Event occurs on
or before March 31, 2007, then 60,000 of the outstanding and unvested Stock
Options will vest immediately; or (ii) if the closing of the Financing Event
occurs on or before December 31, 2007, then 30,000 of the outstanding and
unvested Stock Options will vest immediately.  If vesting of the Stock Options
is accelerated pursuant to this Section, the remaining unvested Stock Options
shall be redistributed pro-rata in equal monthly installments over the 48-month
vesting period set forth in Section 3(b).  For purposes of this Section, a
“Financing Event” shall mean the receipt by the Company of $15 million in one or
more related transactions of equity or debt, or a combination of equity or
debt.  For purposes of this Section, Consultant will be considered to have
contributed to a Financing Event “in a material way”

 

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if, in the Board of Directors’ or Audit Committee’s determination, the Financing
Event occurs as a result of his direct and active provision of the Services
listed on Exhibit A.

 

                                b.             Spectrum Overlay.  If the
Company’s Spectrum Overlay product is approved by Time Warner Inc. (“Time
Warner”) or Comcast Corporation (“Comcast”) and sales of the Spectrum Overlay
product to either such customer generates $10 million in booked revenue on or
before December 31, 2008 (the “Required Revenue”), and if the Company’s Board of
Directors or Audit Committee, as applicable, determines that Consultant
contributed in a material way to the completion of such orders from either Time
Warner or Comcast, as the case may be, then (i) 30,000 of the outstanding and
unvested Stock Options will vest immediately upon the Company’s receipt of the
Required Revenue from either Time Warner or Comcast, as the case may be, and
(ii) the remaining number of outstanding and unvested Stock Options (other than
the number of Stock Options that may vest monthly through December 31, 2008)
will vest immediately upon the Company’s subsequent receipt of the Required
Revenue from either Time Warner or Comcast, as the case may be.  For purposes of
this Section, Consultant will be considered to have contributed to the booking
of Required Revenue “in a material way” if, in the Board of Directors’ or Audit
Committee’s determination, the approval and sales of our products to such
customers occur as a result of his direct and active provision of the Services
listed on Exhibit A.

 

For the avoidance of doubt and as an example only, if the Company closes a
Financing Event on May 31, 2007 (at which time 30,000 of the outstanding and
unvested Stock Options will immediately vest) and also books the Required
Revenue from Time Warner in December 2007 prior to booking the Required Revenue
from Comcast, then an additional 30,000 of the outstanding and unvested Stock
Options will immediately vest upon booking of the Required Revenue from Time
Warner.  As of December 20, 2007, an aggregate of 112,080 of the outstanding and
unvested Stock Options will have vested (30,000 Stock Options related to a
Financing Event, 30,000 Stock Options related to booking of Required Revenue
from Time Warner and 52,080 Stock Options that vest monthly (5,208 per month for
10 months)).  If the Company subsequently books the Required Revenue from
Comcast in 2008, then 75,424 of the outstanding and unvested Stock Options will
vest immediately upon booking of the Required Revenue from Comcast, with the
remaining 62,496 Stock Options (5,208 per month for 12 months) vesting on an
equal monthly basis through December [x], 2008.  In all cases, the preceding
example assumes that Consultant has contributed in a material way to the events
referenced.

 

                                c.             Change of Control.  If the
Company enters into a definitive agreement on or before December 31, 2008 which
would result in a Change of Control (defined below) of the Company, then all of
Consultant’s outstanding and unvested Stock Options granted under this Agreement
will vest immediately as of the closing of the Change of Control.  For purposes
of this Section, a “Change of Control” means (i) a sale of all or substantially
all of the Company’s assets; (ii) any merger, consolidation or other business
combination transaction of the Company with or into another corporation, entity
or person, other than a transaction in which the holders of at least a majority
of the shares of the Company’s voting capital stock outstanding immediately
prior to such transaction continue to hold (either by such shares remaining
outstanding or by their being converted into shares of voting capital stock of
the surviving entity) a majority of the total voting power represented by the
shares of the Company’s voting capital stock (or the surviving entity)
outstanding

 

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immediately after such transaction; or (iii) the direct or indirect acquisition
(including by way of a tender or exchange offer) by any person, or persons
acting as a group, of beneficial ownership or a right to acquire beneficial
ownership of such shares representing a majority of the voting power of the then
outstanding shares of the Company’s capital stock.

 

5.             Term; Termination.

 

a.             Term.  Unless sooner terminated as provided below, the Agreement
will continue in effect for a period of one year (the “Term”).  On each
anniversary of the Effective Date, the Term will automatically be extended for a
period of one year unless otherwise terminated in accordance with this
Agreement.

 

b.             Termination.  Either Party may terminate this Agreement on 30
days prior written notice.  Either Party may terminate this Agreement
immediately and without prior notice if the other Party is in breach of any
material provision of the Agreement.

 

c.             Effect of Termination.  Following termination or expiration of
this Agreement, the Company shall be obligated to pay Consultant for Services
provided through the date of termination or expiration.  Termination of this
Agreement for any reason shall not affect the obligations of the Parties under
Section 6 of this Agreement entitled “Trade Secrets.”  If the Company terminates
this Agreement without cause, Consultant’s unvested Stock Options shall continue
to vest for three months after the date of termination, at which time all
remaining unvested Stock Options shall be automatically forfeited.  Except as
may be otherwise provided in this Agreement, upon termination of this Agreement
all unvested Stock Options shall be automatically forfeited.

 

6.             Trade Secrets.

 

a.             Definition.  The Parties acknowledge and agree that during the
Term of this Agreement and in the course of the discharge of his duties
hereunder, Consultant shall have access to and become acquainted with the
following information concerning the operation of the Company and the Company’s
affiliates, and that of the Company’s clients and customers:  confidential
information, future plans, business forecasts, data and other technical
information, test data, customer lists, research and development activities,
marketing plans and strategies, processes, know-how and other trade secrets and
proprietary information (the “Confidential Information”).

 

b.             Duty of Confidentiality.  Consultant agrees that he shall not
disclose any Confidential Information, directly or indirectly, to any other
person or use such Confidential Information in any way, either during the Term
of this Agreement or at any other time thereafter, except as is required in the
course of Consultant’s Services to the Company, or as otherwise required by
applicable law.  Consultant further agrees that all files, records, documents,
equipment and similar items relating to the Company’s business, whether prepared
by Consultant during the term of this Agreement or by others, are and shall
remain exclusively the property of the Company.

 

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c.             Excluded Information.  The Parties agree that the prohibitions of
this Section 6 shall not apply to any information which:

 

(i)            At the time of disclosure is in the public domain;

 

(ii)           After disclosure becomes a part of the public domain through no
act or omission of Consultant;

 

(iii)          Was known by or in the possession of Consultant prior to
disclosure by the Company; or

 

(iv)          Is rightfully received by Consultant from third parties not
employed by the Company.

 

7.             Miscellaneous Provisions.

 

a.             Notices.  Any notice required to be given pursuant to this
Agreement shall be effective only if in writing and delivered personally or by
mail.  If given by mail, such notice must be sent by registered or certified
mail, postage prepaid, and mailed to the Parties at the addresses set forth on
the signature page hereof, or at such other addresses as the Parties may
designate from time to time by written notice.  Mailed notices shall be deemed
received two business days after the date of deposit in the mail.

 

b.             Partial Invalidity.  If any Section of this Agreement or the
application thereof to any person or circumstance shall be held to be invalid or
unenforceable to any extent, the other Sections of this Agreement (or the
application of the invalid Section to persons or circumstances other than those
to which it is held invalid or unenforceable) shall not be affected thereby, and
each term and provision of this Agreement shall be valid and be enforceable to
the fullest extent permitted by law.

 

c.             Waiver.  No waiver of any right hereunder shall be effective for
any purpose unless in writing and signed by the Party hereto possessing said
right.  No such waiver shall be construed to be a waiver of any subsequent
right, term or provision of this Agreement.

 

d.             Attorneys’ Fees; Costs.  If any Party to this Agreement
institutes any legal action or proceeding against another Party to enforce or
construe any of the provisions of this Agreement, or to determine the validity
thereof, the Party prevailing in such action or proceeding shall be entitled to
recover from the other Party their costs of the action, including as an element
of damages reasonable attorneys’ fees, together with such costs and fees
incurred in enforcing any judgment or decisions entered therein.  The Company
shall pay the reasonable and actual costs billed to Consultant for review of
this Agreement by his legal counsel.

 

e.             Governing Law.  This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware, applicable to contracts
made and to be performed

 

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wholly within the State of Delaware, and without reference to the choice of law
principles of the State of Delaware, or any other state.

 

f.              Arbitration.  Any disputes arising under this Agreement shall be
submitted to binding arbitration by one neutral arbitrator associated with
JAMS/Endispute who is mutually acceptable to the Parties.  The County of
Gwinnett, Georgia, U.S.A. shall be the venue for any proceeding, which
proceeding shall be conducted in accordance with the  rules and procedures of
JAMS/Endisptue and not by court action, except as provided by Delaware law for
judicial review of arbitration proceedings.  Any decision or award entered as a
result of such arbitration shall be final and binding upon all Parties.  The
filing of a judicial action to enable the recording of a notice of a pending
action, for orders of injunction or other provisional remedies, shall not
constitute a waiver of the right to arbitrate under this provision.  The Parties
agree to the exclusive personal jurisdiction of courts of general jurisdiction
in Gwinnett, Georgia, U.S.A., for enforcement of such arbitration awards, agree
to accept any service of process by personal service, facsimile, express or
overnight mail, or regular mail, return receipt requested, at the address listed
below as being binding on such Party and agree to accept such arbitrators and
court as being the sole and exclusive forum and venue for hearing such claims,
disputes, controversies, breaches or similar events.  The Parties agree to waive
any defense of forum non conveniens or improper venue respecting such courts. 
The cost of the arbitration shall be borne by the losing Party or in such
proportion as the arbitrator shall decide.

 

g.             Representation by Independent Counsel.  Consultant acknowledges
that by signing this Agreement, Consultant is deemed to have consulted with
counsel of Consultant’s own choosing in connection with this Agreement.  Each
Party represents that they have read this Agreement in full and understands and
voluntarily consents to each and every provision contained in this Agreement.

 

                                h.             Compliance.   Consultant
represents and warrants to the Company that he is not restricted or prohibited
from entering into this Agreement and providing the Services contemplated
hereby, and that nothing in this Agreement conflicts with any contract or
employment obligation of Consultant.  Nothing contained in this Agreement shall
require or  permit Consultant or the Company to do any act inconsistent with the
requirements of any statute, regulation or rule of the United States or any
State, including, but not limited to the Foreign Corrupt Practices Act or any
similar law, regulation or rule that may be in effect from time to time, or any
contract or employment relationship of the Consultant of which either the
Consultant or the Company may become aware in the future, or any of Consultant’s
fiduciary obligations to any company, including without limitation, the Company.

 

i.              Entire Agreement.  This Agreement and the attached
Exhibit(s) contain the entire agreement and understanding between the Parties
related to Consultant’s Services to the Company and supersedes all prior
agreements and understandings, oral or written.  No modification, termination or
attempted waiver shall be valid unless in writing and signed by Consultant and
the Company.

 

j.              Execution.  This Agreement may be executed in one or more
counterparts, all of which when taken together shall be considered one and the
same agreement and shall become

 

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effective when counterparts have been signed by each party and delivered to the
other party, it being understood that both parties need not sign the same
counterpart.  In the event that any signature is delivered by facsimile
transmission, such signature shall create a valid and binding obligation of the
party executing (or on whose behalf such signature is executed) with the same
force and effect as if such facsimile signature page were an original thereof.

 

IN WITNESS WHEREOF, the undersigned have executed this Agreement as set forth
below.

 

Date: February 1, 2008

Date: February 1, 2008

 

 

Vyyo Inc.

James A. Chiddix

6625 The Corners Parkway, Suite 100

6625 The Corners Parkway, Suite 100

Norcross, Georgia 30092

Norcross, Georgia 30092

 

 

 

By:

/s/ Wayne H. Davis

 

/s/ James A. Chiddix

Name:

Wayne H. Davis

 

Title:

Chief Executive Officer

 

 

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EXHIBIT A

 

Services to be Performed

 

Consultant shall provide the following services to the Company as needed and/or
requested:

 

•             Speak or meet with key customers in support of the Company and its
products

 

•             Conduct interviews with the trade and business press in support of
the Company and its products

 

•             Speak or meet with stock and industry analysts to support the
Company and its products

 

•             Speak or meet with parties who are considering an investment
(equity or debt) in the Company

 

•             Meet with Company management from time-to-time to discuss product
strategy

 

•             Be reasonably available to speak with Company senior management to
discuss business, product, customer and other issues.

 

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