EXHIBIT
10.1


 


CONSULTING
AGREEMENT


 


This
CONSULTING AGREEMENT (this “Agreement”), dated as of May 8, 2008 is
between Micro Component Technology, Inc., a Minnesota corporation (the “Company”),
and LMWH Management Partners LLC, a California limited liability company (the “Consultant”).


 


W I T N
E S S E T H :


 


WHEREAS,
the Company desires to obtain the services of the Consultant on the terms and
conditions set forth in this Agreement; and


 


WHEREAS,
the Consultant is willing to perform such services on such terms and
conditions.


 


NOW,
THEREFORE, in consideration of these premises and the mutual agreements
hereinafter set forth, the parties hereto, intending to be legally bound,
hereby agree as follows:


 


1.  Services.  The Consultant shall, while at all times reporting
to the Chairman of the Board of Directors of the Company (the “Board”),
provide such business consulting and other services as detailed on Exhibit A
hereto and as the Board may, from time to time, designate for the Company
and/or its subsidiaries and other affiliates (collectively, the “Company
Group”). The Consultant’s services shall be provided by John Moon, or other
persons approved by the Company.  The
Consultant shall not perform services for Laurus Master Fund, Ltd. or its
affiliates during the period it is performing services for the Company without
prior written approval by the Company’s Board of Directors.  The Consultant shall devote such time and
attention as necessary to properly perform its duties and responsibilities
hereunder.  The Company hereby
acknowledges and recognizes that the Consultant has other business interests
and may continue to have such business interests concurrently with the
performance of this Agreement.


 


2.  Independent Contractor.  It is the intention and agreement of the
parties that the Consultant shall be retained by the Company pursuant to this
Agreement, and shall perform its duties and all services hereunder, as an
independent contractor.  Nothing herein
shall be deemed to create a partnership, joint venture or employment
relationship between the Consultant and the Company.


 


3.  Consultant of Company.  The Consultant, in cooperation with the
Chairman of the Board, may serve as an agent for the Company and may execute
documents on behalf of and otherwise bind the Company in connection with the
provision of the consulting services provided by the Consultant.  The Consultant shall not execute or bind the
Company to any material obligation without prior approval by the Company’s
Board of Directors.


 


4.  Expenses of the Company.  During the Term (as defined below), the
Company shall reimburse the Consultant for all reasonable and necessary
out-of-pocket business expenses incurred by the Consultant in connection with
the performance of the Consultant’s services 


 


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hereunder.  The Consultant shall submit a quarterly
budget of estimated expenses to the Company for approval prior to the beginning
of each quarter.  To be eligible for
reimbursement, expenses must be consistent with the budget and Company expense
policies, or approved in advance by the Company’s Chairman. Such reimbursement
shall be made by the Company monthly, after receipt of an invoice from the
Consultant accompanied by receipts or other satisfactory documentation of such
expenses.


 


5.  Consulting Fee.  The Company shall pay to the Consultant and
the Consultant shall accept, as compensation for the services rendered to the
Company hereunder: (i) a five-year non-qualified option to purchase an
aggregate of 3,000,000 shares of Common Stock, of the Company exercisable at a
price equal to the closing sale price of the Common Stock on the date the
Option is approved by the Company’s Compensation Committee (the “Option”),
and which shall vest in accordance with Exhibit A, and (ii) an annual
consulting fee (the “Consulting Fee”) of $180,000 USD for each year,
payable in cash, monthly in arrears on the first business day of each
month.  John Moon will allocate 50% of
his business time (the “Allocated Time”) to the Company, and if the
Allocated Time becomes significantly more or less than 50% of his business
time, the Company and Consultant will renegotiate the Consulting Fee
accordingly. The Option shall be documented in a separate Stock Option
Agreement.


 


6.  Term. 
The term of this Agreement (the “Initial Term”) shall commence on
the date hereof and shall continue in full force and effect until December 31,
2010, unless extended by mutual agreement of the parties (the Initial Term, as
so extended, is herein referred to as the “Term”).  Notwithstanding the foregoing provisions of
this Section, the Company or the Consultant may terminate the Consultant’s
engagement at any time during the Term in accordance with Section 8.


 


7.  Termination of Engagement.  The engagement of the Consultant hereunder
and this Agreement may be terminated by either party, with or without cause, at
any time during the Term upon 90 days prior written notice to the other
party.  Except as set forth in Section 0,
the termination of the Consultant pursuant to this Section shall not
result in any penalty or fee payable to the Consultant.  The Option may be exercised for one year
after termination to the extent vested on termination.


 


8.  Action upon Termination.


 


(A)  The Company
shall, forthwith upon any termination of this Agreement, pay to the Consultant
all amounts payable to the Consultant hereunder to and including the day
immediately preceding the effective date of termination of this Agreement.


 


(B) The Consultant
shall, forthwith upon any termination of this Agreement, deliver to the Board
and where applicable transfer into the name of the Company (or such person as
the Board may direct in writing) all property, documents, books and records of
the Company in the name of or in the custody of the Consultant.


 


9.  Confidential Material.  The Consultant shall, during the Term and for
a period of three years thereafter, not disclose confidential material (as
defined below) and shall take all reasonable 


 


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measures to
maintain the confidentiality of the confidential material, except as required
in the performance of the Consultant’s duties and responsibilities under this
Agreement.  The Consultant agrees that
all confidential material, together with all notes and records of the
Consultant relating thereto, and all copies or facsimiles thereof in the
possession or control of the Consultant (whether made by the foregoing or other
means) are the exclusive property of the Company.  The Consultant shall not in any manner use
any confidential material, or any other property of the Company, in any way
which is or could reasonably be expected to be materially detrimental to the
Company.  Promptly upon the request of
the Company, the Consultant shall deliver to the Board, or a person designated
by the Board, or destroy all confidential material in the possession of the
Consultant, provided that the Consultant may retain a file copy thereof.


 


For the purposes hereof,
the term “confidential material” shall mean all information and/or
material acquired in the course of the engagement of the Consultant hereunder
concerning the projects, activities, business or affairs (financial or
otherwise) of the Company or any other member of the Company Group, as the case
may be, or any of the customers or suppliers of the Company or any other member
of the Company Group, whether or not provided by or on behalf of the Company,
including, without limitation, information concerning the past, present or
future customers, suppliers, business, proprietary matters, trade secrets,
products or projects, sales and other financial information and development
projects or marketing plans of the Company or any of the other members of the
Company Group; provided, however, that the term “confidential material” shall
not include information which (i) becomes generally available to the
public other than as a result of a disclosure by the Consultant (but only after
it enters the public domain), (ii) was available to the Consultant on a
non confidential basis prior to the engagement of the Consultant hereunder, (iii) becomes
available to the Consultant on a non confidential basis from a source other
than the Company or any other member of the Company Group or any of their
respective agents, customers, suppliers or clients; provided that the
Consultant does not know that such source is bound by a confidentiality
obligation to the Company or any other member of the Company Group or any of
such agents, customers, suppliers or clients, or (iv) information which is
independently developed by the Consultant without use of confidential
information of the Company or any of its affiliates.


 


In the event that the
Consultant is required in the context of any civil or criminal proceeding or
regulatory action or investigation, by oral questions, interrogatories,
requests for information or documents, subpoena, civil investigative demand or
similar process, to disclose any confidential material, the Consultant shall
provide the Company with prompt notice thereof, including copies of all
relevant documents and information, so that the Company may seek an appropriate
protective order and/or waive compliance by the Consultant with the provisions
hereof; provided, however, that if in the absence of a protective order or the
receipt of such a waiver, the Consultant is compelled to disclose confidential
material not otherwise disclosable hereunder to any legislative, judicial or
regulatory body, agency or authority, or else be exposed to liability for
contempt, fine or penalty or to other censure, such confidential material may
be so disclosed, provided that the Consultant has provided the Company with
prior written notice and copies of all relevant documents.


 


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10.  Miscellaneous.


 


(A)  Amendments.  This
Agreement shall not be amended or modified in whole or in part except by
instrument in writing signed by a representative of the Consultant and by a
representative of the Company duly authorized for the purpose by the Board.


 


(B)  Assignment. 
This Agreement or any part thereof may not be assigned by the Consultant
other than to a subsidiary or affiliate of the Consultant.


 


Except as herein
provided, this Agreement shall not be assigned by the Company without the prior
consent in writing of the Consultant being first had and obtained (such consent
shall not be unreasonably withheld).  Any
attempted assignment in violation of this Section 0 shall be null and
void.  Notwithstanding the foregoing
sentences, the Company may assign this Agreement to any of its subsidiaries and
affiliates and, upon any such assignment, this Agreement shall be binding upon,
and inure to the benefit of, the applicable assignee and the Consultant or to
any successors (whether direct or indirect, by purchase, merger, consolidation
or otherwise) to all or substantially all of the business and/or assets of the
Company.  As used in this Section 0,
the “Company” shall mean the Company as hereinbefore defined and any
permitted assignee as aforesaid and any successor to the Company’s business
and/or assets as aforesaid which otherwise becomes bound by all the terms and
provisions of this Agreement, and this Agreement shall be binding upon, and
inure to the benefit of, the Company, as so defined, and the Consultant.


 


(C) 
Liability and Indemnity.  The Consultant shall indemnify
and save harmless the Company, its affiliates and subsidiaries and their
respective directors, officers, members, shareholders and employees from and
against all claims whatsoever (including costs, charges and legal and other
expenses reasonably incurred in connection therewith) brought, commenced or
prosecuted against any of them for or in respect of any act, deed, matter or
thing whatsoever made, done, acquiesced in or omitted in or about or in relation
to the execution of the Consultant’s duties hereunder in any circumstance where
there has been acts constituting fraud, willful misconduct, gross negligence,
or reckless disregard of the Consultant’s duties on the part of the Consultant.


 


Except as set out in the
next succeeding sentence, none of the Consultant, nor any direct or indirect
shareholder, director, officer, partner, employee, agent, member, advisor or
representative of the Consultant, shall be liable to the Company or to any
stockholder thereof for, and the Company shall indemnify and save harmless the
Consultant and such persons from and against all claims whatsoever (including
costs, charges and legal and other expenses reasonably incurred in connection
therewith) brought by or on behalf of the Company, any of its stockholders or
any third parties in respect of, (i) any act, omission, negligence or
default of any person employed or engaged by the Consultant in the course of
the exercise of its duties and responsibilities hereunder, (ii) any loss
occasioned by any mistake or error in judgment or any act or omission of the
Consultant made in the course of or in connection with the exercise of the
duties of the Consultant hereunder, (iii) any action or inaction arising
from good faith reliance upon the opinion or advice as to legal matters of
legal counsel or as to accounting matters of accountants selected by any of
them, which may include the legal counsel or accountants for the 


 


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Company, or (iv) for
any other loss, damage or expense which may arise during or in the course of
the performance of the Consultant’s obligations, responsibilities, powers,
discretions or authorities under this Agreement.  The limitations of liability and indemnification
contained in this paragraph shall not apply to the extent, but only to the
extent, that any particular loss, damage or expense is directly attributable to
the fraud, willful misconduct or gross negligence of or the willful and
material violation of applicable laws by the Consultant and any of its
directors, officers, agents, shareholders, partners or employees.


 


Persons entitled to be
indemnified pursuant to this Section 0 are herein referred to as “Indemnified
Parties”.


 


(D) 
Notices.  All notices and other communications in
connection with this Agreement and the transactions contemplated hereunder
shall be in writing and shall be either telecopied, delivered personally,
delivered by reputable overnight courier or mailed by certified mail, return
receipt requested, postage pre-paid, to the recipient at such recipient’s
address as shall from time to time be specified by the recipient, and initially
as set forth in this Section 0.  All
such notices shall be effective and deemed received upon delivery, if delivered
by hand; three days after deposit in the mail, postage prepaid, if mailed; or
upon receipt, in the case of telecopy or sent by overnight courier.  Each notice, request, instruction or document
shall bear the date on which it is delivered or mailed.  Notice may be given by attorneys on behalf of
the parties.  Notices and other
communications shall be addressed as follows:


 


To the Company:


 


Micro Component Technology, Inc.
  2340 West County Road C

St. Paul, MN 55113

(651) 697-4111

Fax:  (651) 697-4200

Attn:  Roger E. Gower


 


To the Consultant:


 


LMWH Management Partners LLC


11340 W. Olympic Blvd., Suite 210


Los Angeles, CA 90064


Fax: 
310-312-3036


Attn:  John H.
Moon, Partner


 


(E)          Enurement.  This Agreement shall enure to the benefit of
and be binding upon the parties hereto, their successors and permitted assigns.


 


(F)          Further Assurances.  The Consultant and the Company shall promptly
do, make, execute or deliver, or cause to be done, made, executed or delivered,
all such further acts, documents and things as the other may reasonably require
from time to time for the 


 


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purpose
of giving effect to this Agreement, and shall use reasonable efforts and take
all such steps as may be reasonably within their power to implement to the full
extent the provisions of this Agreement.


 


(G)  Entire Agreement. 
This Agreement and the Stock Option Agreement constitute the entire
agreement between the parties pertaining to the subject matter of this
Agreement. There are no warranties, understandings, representations or
agreements between the parties hereto in connection with such subject matter
except as specifically set forth or referred to in this Agreement.  This Agreement supersedes all undertakings
and agreements, whether oral or in writing, if any there be, previously entered
into by the parties hereto with respect thereto.


 


(H)  Severability. 
Should any provision of this Agreement be held by a court of competent
jurisdiction to be enforceable only if modified, such holding shall not affect
the validity of the remainder of this Agreement, the balance of which shall
continue to be binding upon the parties hereto with any such modification to
become a part hereof and treated as though originally set forth in this Agreement.  The parties further agree that any such court
is expressly authorized to modify any such unenforceable provision of this
Agreement in lieu of severing such unenforceable provision from this Agreement
in its entirety, whether by rewriting the offending provision, deleting any or
all of the offending provision, adding additional language to this Agreement,
or by making such other modifications as it deems warranted to carry out the
intent and agreement of the parties as embodied herein to the maximum extent
permitted by law.  The parties expressly
agree that this Agreement as so modified by the court shall be binding upon and
enforceable against each of them.  In any
event, should one or more of the provisions of this Agreement be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality
or unenforceability shall not affect any other provisions hereof, and if such
provision or provisions are not modified as provided above, this Agreement
shall be construed as if such invalid, illegal or unenforceable provisions had
never been set forth herein.


 


(I)  Survival. 
The respective rights and obligations of the parties hereunder shall
survive any termination of this Agreement to the extent necessary to permit the
intended preservation of such rights and obligations.  Without limiting the generality of the
foregoing, any provision of this Agreement which is intended by its plain
meaning to continue shall survive the termination of this Agreement and the
Consultant’s engagement hereunder.


 


(J)  Applicable Law. 
This Agreement shall be governed by, construed and enforced in
accordance with, the laws of the State of Minnesota, without regard to any
conflict of laws principles of the State of Minnesota which would apply the
laws of any other jurisdiction.  Without
limiting the generality of this Section 0, in the event that a court of
any jurisdiction shall hold any of the provisions of this Agreement to be
wholly or partially unenforceable for any reason, such determination shall not
bar or in any way affect either party’s right to relief as provided for herein
in the courts of any other 


 


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jurisdiction; such
provisions, as they relate to each jurisdiction are, for these purposes,
severable into diverse and independent covenants.


 


(K)  Waiver. 
Except as otherwise specifically provided in this Agreement, no waiver
by either party hereto of any breach by the other party hereto of any condition
or provision of this Agreement to be performed by such other party shall be
deemed a waiver of a similar or dissimilar provision or condition at the same
or any prior or subsequent time, nor shall the failure of or delay by either
party hereto in exercising any right, power or privilege hereunder operate as a
waiver thereof to preclude any other or further exercise thereof or the
exercise of any other such right, power or privilege.


 


(L)  Headings. 
The respective sections and paragraphs of this Agreement are intended
solely for convenience, and no provision of this Agreement is to be construed
by reference to the heading of any section or paragraph.


 


(M) Counterparts. 
This Agreement may be executed in counterparts (including counterparts
by facsimile transmission) and each of such counterparts shall constitute an
original document and such counterparts, taken together, shall constitute one
and the same instrument.


 


(N)  No Third Party
Beneficiaries.  Nothing in this Agreement shall be deemed to
create or to grant to any persons other than the Consultant, the members of the
Company Group and the Indemnified Parties any third party beneficiary rights,
claims or causes of action of any kind or nature against either the Consultant
or the Company.


 


(O)  Arbitration. 
Any dispute, controversy or claim arising out of or in connection with
or relating to this Agreement shall be determined and settled by arbitration in
Minneapolis, Minnesota pursuant to the rules then in effect of the
American Arbitration Association by one arbitrator appointed in accordance with
those rules.  Any award rendered by the
arbitrator shall be final and conclusive upon the parties and judgment thereon
may be entered in any court having jurisdiction.


 


*              *


 


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IN
WITNESS WHEREOF the Consultant and the Company have executed this Agreement on
the day and year first above written.


 


 


	
   

  	
   

  	
  Micro Component
  Technology, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ Roger E. Gower

  
	
   

  	
   

  	
   

  	
   Roger E. Gower

  
	
   

  	
   

  	
   

  	
   Chairman and CEO

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  LMWH Management Partners
  LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ John Moon

  
	
   

  	
   

  	
   

  	
   Its: Partner

  



 





















 


EXHIBIT
A


 


Description of Services and
Option vesting Milestones


 


A.           General business consulting as seen fit by the
consultant in cooperation with the board of directors


 


B.             Formalizing reports


 


C.             Review and assist in negotiating or preparation of:


 


a.               Strategic Alliance agreements (includes joint
ventures, mergers and acquisitions, etc.)


 


b.              Sales agreements (major OEM customer sales agreements)


 


c.               Vendor agreements


 


d.              Business plan writing (preparation of MCT Business
Plan for acceptance by Laurus for 2008 and 2009)


 


e.               Budgets (consistent with Business Plan preparation)


 


f.                 Business presentations


 


g.              Finance agreements (negotiate, with MCT management
participation, a restructuring in present and future Laurus debt agreement)


 


h.              Equity agreements. 
(identify opportunities to include equity infusions from joint ventures
and other M&A activity).


 


OPTION VESTING SCHEDULE


 


	
  Milestone

  	
   

  	
  Shares Vested

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Execution by the
  Company of financial restructuring agreement with Laurus

  	
   

  	
  1,500,000 Shares

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Execution by the
  Company of first strategic agreement (e.g., joint venture, license, joint
  marketing or joint development) generating possibility of near term revenues
  in excess of $3M

  	
   

  	
  500,000 Shares

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Execution by the
  Company of second strategic agreement (e.g., joint venture, license, joint
  marketing or joint development) generating possibility of near term revenues
  in excess of $3M

  	
   

  	
  500,000 Shares

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Execution by the
  Company of third strategic agreement (e.g., joint venture, license, joint
  marketing or joint development) generating possibility of near term revenues
  in excess of $3M

  	
   

  	
  500,000 Shares