Exhibit 10.1

 

CONSULTING AGREEMENT

 

THIS CONSULTING AGREEMENT (“Agreement”) is entered into as of March 17, 2014 by
and between Steven Ledger (“Consultant”) and HopTo Inc (the “Company”), with
reference to the following recitals:

 

A.           Consultant possess significant experience and skills in the
Company’s line of business, including as a result of extensive service on the
Company’s Board of Directors (the “Board”); and

 

B.           The Board wishes to retain the services of Consultant on the terms
set forth herein, commencing on his resignation from the Board on March 17, 2014
(the “Commencement Date”).

 

IT IS THEREFORE AGREED THAT:

 

1.           Resignation; Exclusive Services. Consultant resigned from the Board
of Directors of the Company pursuant to the resignation letter attached as
Exhibit A. From the Commencement Date until August 15, 2014, (such period, the
“Term”), Consultant shall make himself reasonably available, during normal
business hours, to consult with the Board regarding implementation of the
actions taken and policies set by the Board from time to time (the “Services”).
The Services may also include advice on strategic or operational matters,
reasonable cooperation on any litigation involving third parties, transition
services to the Board’s committees, and other services as the parties may
reasonably agree. Because the Services are defined primarily by the experience
and skill possessed by the Consultant rather than the amount of time spent by
the Consultant, there is no minimum number of hours of Services to be provided
hereunder.

 

Consultant will not, during the Term, provide strategic consulting services to
any company that is a direct competitor with the Company’s current business
focus as publicly disclosed.

 

2.           Compensation. The sole compensation for the Services shall be as
follows:

 

(a)     Consultant acknowledges that he currently has a total of 700,000 options
to purchase the Company’s common stock, of which 260,607 options are currently
unvested (the “Unvested Equity”). The Unvested Equity shall continue to vest
during (but not beyond) the Term so long as Consultant continues to provide the
Services during the Term (and for clarity, Consultant’s change in status from
director to consultant is intended not to interrupt his continuous status for
vesting purposes). All of Consultant’s options shall remain subject to their
currently existing terms and conditions, including the rate of vesting, the
terms governing forfeiture and the time period to exercise options after the end
of the Term; provided, however, the Company hereby agrees that the time period
to exercise Consultant’s options that have vested as of the end of the Term
shall be extended through December 31, 2014 (immediately after which point such
time period shall expire) notwithstanding any earlier exercise period provided
for in such options (the “Option Exercise Extension”). For clarity, any Unvested
Equity that would otherwise have vested after the Term shall be forfeited except
to the extent the Term is extended by mutual written agreement.

 

 
 

--------------------------------------------------------------------------------

 

 

(b) To the extent Services are requested, the Company will repay or reimburse
Consultant for ordinary and necessary business expenses to the extent compatible
with, and subject to the verification and substantiation documentation and
procedures applicable under, the Company’s policies.

 

3.           Confidentiality and Non-Disparagement.

 

(a)     While Consultant was/is a director of the Company, as part of his
fiduciary duties, he was/is subject to duties of confidentiality with respect to
the Company’s confidential or proprietary information (the “Information”).
Consultant agrees, during and after the Term, to continue to abide by such
duties with respect to the Information to the same extent as when he was a
director. If he learns additional Information during the Term, it shall be
subject to the same limitation. Without limiting the rights and remedies
otherwise available to it, each party agrees that the other would be irreparably
harmed by any breach or threatened breach of this Section 3 and accordingly that
the other party shall be entitled to equitable relief by way of injunction.
Nothing in this Section 3(a) displaces any existing confidentiality agreement
Consultant or his affiliated companies may have with the Company.

 

It is acknowledged by both parties that as a public Company that Company is
entitled to disclose and file this Agreement with the SEC to the extent
necessary to comply with its legal obligations.

 

(b)     Consultant agrees that he will not make any negative, disparaging,
detrimental or derogatory comments to any third party concerning the Company or
its current and former officers, directors, employees, agents, representatives,
affiliates or subsidiaries. The Company agrees that no person authorized to
speak for it (i.e., the members of its Board of Directors and its executive
officers), nor the Company itself in any statement by the Company, will make any
negative, disparaging, detrimental or derogatory comments to any third party
concerning Consultant. Nothing in this Section 3(b) shall prevent either
Consultant or the Company from (i) making truthful statements regarding the
other where compelled by legal process in the form of a court order, order from
a regulatory agency or similar legal process or where required by the rules and
regulations of the Securities and Exchange Commission or (ii) responding
truthfully to a breach by the other party of this Section 3(b). Consultant and
the Company will mutually agree upon the content and form of any staff or public
announcement regarding his employment with, and departure from, the Company;
provided, the Company may in its discretion file a Current Report on Form 8-K
(and in any other SEC filing) announcing the resignation of Consultant and the
terms (and providing a copy) of this Agreement.

 

4.           Past Services. Consultant agrees he is not entitled to any
additional compensation (cash, equity or otherwise) for any services he
previously rendered to the Company as a director or otherwise. Consultant claims
no ownership interest in any of the Company’s assets, properties, patents or
technologies, whether as an inventor, owner, developer, contributor or
otherwise, or any right to receive additional equity, profits or the like.

 

 
 

--------------------------------------------------------------------------------

 

 

5.           Term. This Agreement will expire at the end of the Term, except (a)
if terminated earlier by the parties, acting mutually in writing, or (b) by any
party at any time after the date hereof, if the other party materially breaches
its obligations hereunder and does not cure such breach after a 15 day written
notice reasonably describing such breach. Sections 3 through 7, and the Option
Exercise Extension will survive the expiration or termination of this Agreement
in accordance with their terms.

 

6.           Independent Contractor. Consultant is being retained hereunder only
for the purposes and to the extent set forth in this Agreement, and Consultant’s
relationship to the Company will be that of an independent contractor.
Consultant will not be considered under this Agreement as having employee
status. Consultant acknowledges that no federal or state withholding taxes,
FICA, SDI, or other employee payroll taxes or deductions will be made with
respect to compensation paid to Consultant pursuant to this Agreement.
Consultant is responsible for all such taxes, and agrees to report for federal
and state income and any other tax purposes all such compensation, and to pay
all taxes due thereon. Consultant shall not be entitled to any benefits provided
to employees of the Company or any of its affiliates, whether consisting of
participation in an employee retirement, pension, supplemental compensation,
defined contribution or similar plan; workers’ compensation; disability,
termination or severance pay or other similar benefits; unemployment or other
similar insurance or otherwise.

 

7.           Miscellaneous. This Agreement sets forth the entire agreement and
understanding of the parties hereto in respect to the subject mater hereof, and
supersedes all prior agreements, arrangements and understandings relating to the
subject matter hereof and is not intended to confer upon any other person any
rights or remedies hereunder; provided, nothing in this Agreement affects
Consultant’s Directors and Officers Indemnity Agreement or rights to
indemnification under the Company’s charter or bylaws, which remains in full
force and effect. There have been no representations or statements, oral or
written, that have been relied on by any party hereto, except those expressly
set forth in this Agreement. This Agreement may not be amended, altered or
modified except by a writing signed by the parties. This Agreement may be
executed simultaneously in two or more counterparts, each of which will be
deemed an original, but all of which together will constitute one and the same
instrument. This Agreement shall be governed by the law of California, without
regard to any conflicts of law provisions. Any action to enforce this Agreement
may be brought, and each party consents to the personal jurisdiction of, the
federal or state courts in Santa Clara County, California. The prevailing party
in any dispute hereunder shall be entitled to its reasonable attorneys fee and
costs. Any party shall be entitled to seek an injunction or other equitable
remedy to prevent breaches or future breaches of this Agreement, in addition to
other remedies or damages available at law.

 

IN WITNESS WHEREOF, this Agreement has been entered into as of the date first
written above.

 

HopTo Inc.

 

 

By: /s/ Eldad Eilam

 

Eldad Eilam, CEO

 

 

Consultant

 

/s/ Steven Ledger

Steven Ledger

 

 
 

--------------------------------------------------------------------------------

 

 

EXHIBIT A

 

March 17, 2014

 

To the Board of Directors of HopTo Inc.

 

Dear Fellow Board Members:

 

I hereby resign, effective immediately, from the Board of Directors of Hopto
Inc. and any of its subsidiaries on which I was a board member, and any other
position I held with Hopto or such subsidiaries. I confirm that my resignation
was not due to any disagreement with Hopto on any matter relating to its
operations, policies or practices.

 

Sincerely,

 

/S/ Steven Ledger

Steven Ledger