EXHIBIT 10.2

 

MANAGEMENT CONSULTING AGREEMENT

 

This Management Consulting Agreement (“Agreement”) is entered into this 30th day
of May, 2003, by and between PurchaseSoft, Inc., a corporation organized and
existing under the laws of the State of Delaware and having a principal place of
business at 7514 Girard Ave Ste 1440, La Jolla, CA 92037 (“Client”), and
Thomas B. Marsh, an individual having a principal place of business at 7514
Girard Ave Ste 1440, La Jolla, CA 92037 (“Consultant”).

 

1.  Performance by Consultant

 

Consultant agrees to provide management consulting services to Client as may be
necessary to completely discharge the duties of the offices of Secretary and
Treasurer for PurchaseSoft, Inc. Consultant agrees to spend his time on the
affairs of the Company to the extent necessary to discharge the responsibilities
attendant to these offices, to use his reasonable best efforts to perform
faithfully and efficiently such responsibilities.

 

2.  Payment for Services

 

a.  Fees, Price Protection.  Client agrees to pay Consultant for the management
consulting services as follows:

 

4.

 

Company will pay a commission of 10% of revenue per month from software
licenses, upgrades, maintenance, hosting and professional services, however,
such revenue will not include revenue from acquired operations for which
compensation is determined under 2.a 2. below.  Compensation under this
paragraph shall be limited to a maximum of $10,000 per month.  Commission is
calculated on revenue as recorded in the Company’s accounting records under GAAP
and is payable by the 10th of the following month.

 

 

 

5.

 

Company will pay a management fee of $10,000 at closing and $3,000 per month
thereafter for each acquisition completed by the Company provided the aggregate
value of the acquisition at closing is over $500,000.  Monthly fee is payable by
the 10th of the following month.

 

 

 

6.

 

Company will pay a commission of 2% on the net proceeds received by the Company
from any debt or equity financing transaction completed whose aggregate value
exceeds $100,000.  The maximum paid under this provision will be $50,000 per
transaction.  Payment will be due within five days of the receipt of funds by
the Company.

 

The total fees paid under 2.a.1 and 2.a.2 above shall be limited to a maximum of
$15,000 per month.  The fees as specified herein are the total fees and charges
for the services and will not be increased during the term of this Agreement
except as the parties may agree in writing.

 

b.  Out-of-Pocket Expenses.  Consultant shall be reimbursed for all reasonable
out-of-pocket expenses including, but not limited to, meals, suitable short-term
housing, and transportation expenses such as gas and mileage. Consultant shall
follow Client’s standard practices in the submission of all claims for
reimbursement.

 

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c.  Grant of Non-Statutory Stock Option.  None.

 

3.  Rights in Data and Works

 

a.  Ownership.  Consultant agrees that Client is the owner of all right, title
and interest in all computer programs, including any source code, object code,
enhancements and modifications, all files, including input and output materials,
all documentation related to such computer programs and files, all media upon
which any such computer programs, files and documentation are located (including
tapes, disks and other storage media) and all related material that are used by,
developed for, or paid for by Client in connection with the performance of any
services provided by Consultant before or after the date set forth above.

 

b.  Proprietary Rights.  In no way limiting Section 3.a above, Consultant agrees
that all copyrights and other proprietary rights in computer programs, files,
documentation, and related materials that are paid for by Client or developed by
Consultant in connection with this Agreement are owned by Client and Consultant
hereby assigns to Client all right, title and interest in such copyrights and
other proprietary rights.

 

4.  Termination

 

a.  Commencement and Renewal.  This Agreement shall commence on the date set
forth above and shall remain in effect for one year.  Thereafter, this Agreement
shall be renewed automatically without interruption for successive one (1) year
terms at the same terms, conditions and prices as set forth herein except that
there shall be no additional grants of options to purchase stock without
separate Board action.  After the initial one year term, either party may notify
the other party, in writing, of its election not to renew, in which event this
Agreement will terminate one hundred eighty  (180) days after receipt of such
notice.  This Agreement may be renewed with revised terms, conditions and prices
only upon written agreement of both parties.

 

b.  Termination.  Either party, upon giving written notice to the other party,
may terminate this Agreement:

 

i.  if the other party or its employees, consultants or other agents violate any
provision of this Agreement and the violation is not remedied within thirty (30)
days of the party’s receipt of written notice of the violation;

 

ii.  if at any time after the commencement of the Services, Client, in its
reasonable judgment, determines that such services are inadequate,
unsatisfactory, or substantially nonconforming to the specifications,
descriptions, warranties, or representations contained herein and the problem is
not remedied within thirty (30) days of the party’s receipt of written notice
describing the problem; or

 

In the event that any of the above events occurs to a party, that party shall
immediately notify the other party of its occurrence.

 

c.  Obligations Upon Expiration or Termination.  Upon expiration or termination
of this Agreement, Consultant shall promptly return to Client all computer
programs, files, documentation, media, related material and any other material
that, pursuant to Section 3 above, is owned by Client.  Expiration or
termination of this Agreement shall not relieve either party of its obligations
regarding Confidential Information under Section 5 below.

 

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5.  Confidential Information

 

a.  Non-Disclosure.  Each party agrees not to use, disclose, sell, license,
publish, reproduce or otherwise make available the Confidential Information of
the other party except and only to the extent necessary to perform under this
Agreement.  Each party agrees to secure and protect the other party’s
Confidential Information in a manner consistent with the maintenance of the
other party’s confidential and proprietary rights in the information and to take
appropriate action by instruction or agreement with its employees, consultants
or other agents who are permitted access to the other party’s Confidential
Information to satisfy its obligations under this Section.

 

b.  Definition.  “Confidential Information” means a party’s information, not
generally known by non-party personnel, used by the party and which is
proprietary to the party or the disclosure of which would be detrimental to the
party.  Confidential Information includes, but is not limited to, the following
types of information (whether or not reduced to writing or designated as
confidential):

 

i.  work product resulting from or related to Services performed under this
Agreement;

 

ii.  a party’s computer software, including documentation;

 

iii.  a party’s internal personnel, financial, marketing and other business
information and manner and method of conducting business;

 

iv.  a party’s strategic, operations and other business plans and forecasts;

 

v.  confidential information provided by or regarding a party’s employees,
customers, vendors and other contractors; and

 

6.  Limitation of Liability

 

In no event shall either of the parties hereto be liable to the other for the
payment of any consequential, indirect, or special damages, including lost
profits.  Client agrees to provide Consultant with coverage as an officer under
its Directors and Officers Liability Insurance Policy with respect to all
services performed by Consultant pursuant to this Agreement.

 

7.  Assignment

 

a.  Consent Required.  Consultant shall not assign or subcontract the whole or
any part of this Agreement without Client’s prior written consent.

 

b.  Subcontracting.  Any subcontract made by Consultant with the consent of
Client shall incorporate by reference all the terms of this Agreement. 
Consultant agrees to guarantee the performance of any subcontractor used in
performance of the Services.

 

8.  Other Provisions

 

a.  Status as Independent Contractor.  Consultant and Client are contractors
independent of one another and neither party’s employees will be considered
employees of the other party for any purpose.

 

b.  Applicable Law and Forum.  This Agreement shall be governed and construed in
accordance with the laws of the State of California without regard to the
conflicts of laws or principles thereof.

 

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c.  Waiver.  No waiver by Client of any breach by Consultant of any of the
provisions of this Agreement shall be deemed a waiver of any preceding or
succeeding breach of the same or any other provisions hereof.  No such waiver
shall be effective unless in writing and then only to the extent expressly set
forth in writing.

 

d.  Entire Agreement.  This Agreement constitutes the entire agreement between
Consultant and Client.

 

e.  Modifications.  No modification of this Agreement shall be effective unless
in writing and signed by both parties.

 

g.  Severability. If any provision of this Agreement is invalid or unenforceable
under any statute or rule of law, the provision is to that extent to be deemed
omitted and the remaining provisions shall not be affected in any way.

 

IN WITNESS WHEREOF, and in acknowledgment that the parties hereto have read and
understood each and every provision hereof, the parties have executed this
Agreement on the date first set forth above.

 

CLIENT:

 

/s/ Steven A. Flagg

 

Signature

 

STEVEN A. FLAGG

 

Name

 

PRESIDENT

 

Title

 

7514 GIRARD AVE STE 1440

La Jolla, CA 92037

 

ADDRESS

 

 

CONSULTANT:

 

/s/ Thomas B. Marsh

 

Signature

 

THOMAS B. MARSH

 

Name

 

7514 GIRARD AVE STE 1440

La Jolla, CA 92037

 

Address

 

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