CONSULTING AGREEMENT
Exhibit
10.1
THIS AGREEMENT is made as of
October 23, 2008, by and between Who’s Your Daddy, Incorporated, a Nevada
corporation having an address at 0000 Xx Xxxxxx Xxxx, Xxxxx 000, Xxxxxxxx
Xxxxxxxxxx 00000 (the "Company"), ticker symbol WYDI and Net Vertex New York
Inc., a New York company, having an address at 00 Xxxx 00xx Xxxxxx,
Xxxxx 000, Xxx Xxxx, XX 00000 (the "Consultant").
RECITALS:
WHEREAS, the Company requires services
to promote its brand and market its products;
WHEREAS, the Consultant has provided
international product distribution and business development services for a
number of companies;
WHEREAS, the Company recognizes the
substantial experience and knowledge of the Consultant in matters relating to
international business contacts;
WHEREAS,
the Company further recognizes that it is in the best interests of the Company
to engage the consulting services of the Consultant; and
WHEREAS,
the Company desires to retain the services of the Consultant, and the Consultant
desires to render such services to the Company upon the terms set forth in this
Agreement.
NOW, THEREFORE, in
consideration of the mutual promises and covenants set forth below, and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
|
1.
|
Recitals. The
Recitals to this Agreement are hereby incorporated into this Agreement as
though fully restated herein.
|
|
2.
|
Engagement. The Company hereby
engages the Consultant, and the Consultant accepts engagement by the
Company, upon the terms and conditions set forth in this
Agreement.
|
|
3.
|
Term. The
term of this Agreement shall begin on the date hereof and shall continue
until October 23, 2009 subject to the following
provisions:
|
|
|
(a)
The Consultant can at its sole discretion elect to withdraw from the
Agreement subject to a 10 day written notice to the Company should the
Consultant deem the Company being unresponsive or uncooperative. Company
would still be liable to the Consultant for any “Success Fees,” as
described in Section 4; generated directly or indirectly by the
Consultants efforts and or
introductions.
|
|
|
(b)
The Company can at its discretion terminate the Agreement subject to a 10
day written notice at the conclusion of the “Initial Period,” defined as
three months, if the Consultant’s efforts have not resulted in tangible
progress by the Consultants on the Company’s behalf. Tangible progress
being meetings scheduled with Japanese, European or US direct or indirect
contacts; “Introduced Parties” of the Consultant regarding active talks or
negotiations pertaining to the “Introduced Parties” direct or in-direct
participation in any joint venture, strategic alliance, etc. with the
Company. The Company will still be liable for any and all “Success Fees”
generated by directly or indirectly by the Consultant’s efforts for the
duration of the Agreement between the
Parties.
|
4. Consulting Services
Compensation.
(a) The Company shall pay to Consultant or its designees as compensation
for its services under
this Agreement:
|
|
(i)
|
As
compensation for its services, the Consultant shall receive 2,000,000
shares of common stock of the Company. Company agrees to issue
such shares upon the execution of this Agreement and Company and
Consultant agree to have said shares be held in an independent third party
escrow account of mutual agreement subject to the following earn out or
claw back provision: 250,000 shares shall be fully earned and
released upon completing a Business Lending Credit Line, loan, or SBA
Program, with no personal guaranty requirements, which the Consultant
secures for the Company for a minimum of $250,000 US, for a minimum period
of one year with an annual interest rate in the range of US
Prime Rate plus 3 Points. An additional 250,000 shares shall be earned and
released upon the accepting of a loan or Credit Line, with no personal
guaranty requirements, for a minimum of $250,000 US, which the Consultant
secures on behalf of the Company from a Tokyo financial institution for a
minimum period of one year with a capability to extend, at an annual
interest rate range of Prime Rate in Japan plus 3 Points. Should the
Company decide not to accept funds made available by either loan approval
within the above parameters then the shares that would have been earned
will be deemed earned regardless of the Company accepting the funds. The
remaining 1,500,000 shares shall be earned and released upon the Company
accepting any form of Commitment Letters for $2,500,000 from parties
introduced by Consultant (the “Introduced Parties”) for joint-venture,
distribution, business development, or strategic business relationships.
However, the Company is under no obligation to accept any such Commitment
Letters. In addition if the Company cancels this Agreement then 500,000 of
the up-front shares shall be deemed earned. Should the Company accept a
Commitment Letter for less than $2,500,000 from an Introduced Party, then
Consultant shall earn a pro rata share of the remaining 1,500,000 shares,
equivalent to the ratio between the amount accepted and $2,500,000.
Additional fees for further consulting services, the “Success Fees”, shall
be paid to the Consultant for any and all Introduced Parties that directly
or indirectly result in any form of direct or indirect joint venture,
distribution, business development, or strategic business relationships,
etc. The Success Fee shall be equal to ten percent (10%) of any
amounts received by the Company from an Introduced Party , plus 100,000
common shares of the Company for each $1,000,000 received from an
Introduced Party, or the equivalent on a pro rata basis. Notwithstanding
the foregoing, to the extent the Consultant is required to have a
securities license in order to lawfully be paid any such Success Fee, the
fee will not be payable to Consultant. The Company shall be under no
obligation to accept any transaction or relationship arranged by
Consultant, except as described in 4(a)(i)
above.
|
|
|
(ii)
|
The
Consultant shall be responsible for arranging independent legal counsel to
act as an escrow type agent for any business relationships the Company may
enter with Third Parties introduced to the Company directly or indirectly
by the Consultant subject to the Company approving the Consultants
selection, but which cannot be unreasonably withheld. Company further
agrees that the Consultants and Company’s signatures shall be required for
approval for the release of any and all monies, stock and chattel to be
released out of said escrow type accounts and that Consultants fees shall
be distributed directly to the account or accounts of Consultant’s
choosing from the escrow type account(s). Should the Company decide not to
accept funds deposited in escrow type account from the business
development, distribution, strategic partners, joint venture or any other
Introduced Party, after approving the terms of such arrangement, then all
appropriate fees and compensation will be deemed earned regardless of the
Company accepting the funds.
|
(b)
The
Company will in the future provide the Consultant with such additional
compensation as the Company and the Consultant shall mutually agree for any
additional services by the Consultant not provided for in this Agreement such as
Licensing, Agreements, Marketing Agreements and any additional services not
specified in this agreement, subject to the same escrow provisions of section 4
a (ii).
(c) The
Company represents and warrants as follows:
|
|
(i)
|
All
issued and outstanding shares of the Company’s common stock (i)
have been duly authorized and validly issued and are fully paid and
non-assessable and (ii) were issued in compliance with all applicable
state and federal laws concerning the issuance of securities, and no
stockholder has a right of rescission or damages against the Company with
respect thereto. The stockholders of the Company have no
preemptive rights under the applicable laws of the State of
Nevada.
|
(d) The
rights, preferences, privileges and restrictions of the shares of the Company’s
common stock are as
stated in the Articles of Incorporation (the “CHARTER”) of the
Company. The shares issued to the Consultant have been duly and
validly reserved for issuance. When issued in compliance with the
provisions of this Agreement and the Company’s Charter, the shares issued to the
Consultant will be validly issued, fully paid and non-assessable, and will be
free of any liens or encumbrances.
(e)
Consultant acknowledges that all shares issued to Consultant pursuant to this
Agreement will not be registered under the Securities Act of 1933, as amended
(the “Act”). Each of the certificates evidencing the Shares shall bear a legend
in substantially the following form:
THE
SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY
STATE, AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF EXCEPT PURSUANT TO (i) AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT AND ANY APPLICABLE STATE LAWS, (ii) TO THE EXTENT APPLICABLE, RULE
144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER THE ACT RELATING TO THE DISPOSITION
OF SHARES), OR (iii) AN OPINION OF COUNSEL, IF SUCH OPINION SHALL BE REASONABLY
SATISFACTORY TO COUNSEL TO THE ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER
THE ACT AND APPLICABLE STATE LAW IS AVAILABLE
(f)
Consultant represents and warrants that it is accepting the Shares
solely for its own account as principal, and not with a view to the resale or
for distribution thereof, in whole or in part, and no other person or entity has
a direct or indirect beneficial interest in such Shares.
|
5.
|
Duties. From time
to time as reasonably requested by the Company, the Consultant agrees to
perform consulting services related to international business development
and other financial service matters, upon the request of the President of
the Company, and will make available qualified personnel for this purpose
and devote such business time and attention to such matters as the
Consultant shall determine is required. Such services shall
include, without limitation, strategic planning, planning meetings with
the international and domestic investment community, assisting the
Company’s management in designing the Company’s Business Plan and
“Growth-by-Acquisition” Strategic Alliance or “Joint-Venture” strategy.
Additionally, Consultant shall prepare or assist in the preparation of a
Company Corporate Profile, Fact Sheets, and Shareholder Letters as
needed.
|
6. Nature of
Engagement. The Company is
engaging the Consultant as an independent contractor. Nothing in this Agreement
shall be construed to create an employer-employee, partnership or joint venture
relationship between the parties. The Company shall have not
liability for any federal, state or local income taxes of the Consultant arising
hereunder. The services to be provided by the Consultant will not be
in connection with the offer or sale of securities in a capital-raising
transaction.
|
|
7.
|
Expenses. The Company
shall be responsible to cover in advance all airline costs and hotel room
expenses
for Messrs. Yamagishi and XxXxxxx to travel to Tokyo in advance to fulfill
the Consultant’s role. Additionally upon receipt of requests from the
Consultant for reimbursement, the Company shall reimburse the Consultant
for all reasonable and necessary expenses the Consultant incurs, on and
prior to and after the date of this Agreement in performing its duties in
connection with this Agreement. The Consultant shall be required to
receive written authorization from the Company prior to incurring any
expenses. Consultant will provide company with written evidence of
expenses with any reimbursement request. Company agrees to cover all costs
associated with translating English documents to Japanese to assist
Consultant with fulfilling their assignment. The Initial Expenses of
$50,000 US to be paid directly out of a bridge loan or SBA Loan or Line of
Credit proceeds.
|
8. Miscellaneous.
(a) Notices. All notices or
other communications required or permitted to be given pursuant to this
Agreement shall be in writing and shall be considered as duly given on (a) the
date of delivery, if delivered in person, by nationally recognized overnight
delivery service or by facsimile or (b) three days after mailing if mailed from
within the continental United States by registered or certified mail,
return receipt requested to the party entitled to receive the same, if to the
Company, Automotive General, at the address set forth herein, 0000 Xx Xxxxxx
Xxxx, Xxxxx 000, Xxxxxxxx Xxxxxxxxxx 00000; and if the Consultant, at the
address set forth herein, 00 Xxxx 00xx Xxxxxx,
Xxxxx 000, Xxx Xxxx, XX 00000. Any party may change his or its
address by giving notice to the other party stating his or its new
address. Commencing on the 10th day after the giving of such notice,
such newly designated address shall be such party's address for the purpose of
all notices or other communications required or permitted to be given pursuant
to this Agreement.
(b) Governing
Law.
This Agreement and the rights of the parties hereunder shall
be governed by and construed in accordance with the laws of the State of
California without regard to its conflicts of law principles. All
parties hereto agree that the mailing of any process in any suit, action or
proceeding in accordance with the notice provisions of this Agreement shall
constitute personal service thereof.
(c) Exclusive
Jurisdiction and Venue. The parties agree that the Courts of
the County of Orange, State of California shall have sole and exclusive
jurisdiction and venue for the resolution of all disputes arising under the
terms of this Agreement and the transactions contemplated herein.
(d) Entire
Agreement; Waiver of Breach. This
Agreement constitutes the entire agreement among the parties and supersedes
any prior agreement or understanding among them with respect to the subject
matter hereof, and it may not be modified or amended in any manner other than as
provided herein; and no waiver of any breach or condition of this Agreement
shall be deemed to have occurred unless such waiver is in writing, signed by the
party against whom enforcement is sought, and no waiver shall be claimed to be a
waiver of any subsequent breach or condition of a like or different
nature.
(e)
Binding
Effect; Assignability. This Agreement
and all the terms and provisions hereof shall be binding
upon and shall inure to the benefit of the parties and their respective heirs,
successors and permitted assigns. This
Agreement and the rights of the parties hereunder shall not be assigned except
with the written consent of all parties
hereto. Notwithstanding any provision of this Agreement to the
contrary, the Consultant shall be entitled to direct
the Company in writing that any funds payable or stock issuable to it pursuant
to this Agreement shall instead be paid
or issued to its designee.
(f) Captions. Captions
contained in this Agreement are inserted only as a matter of convenience and in
no way define, limit or extend the scope or intent of this Agreement or any
provision hereof.
(g) Number
and Gender. Wherever from the
context it appears appropriate, each term stated in either the singular or the
plural shall include the singular and the plural, and pronouns stated in
either the masculine, the feminine or the neuter gender shall include the
masculine, feminine and neuter.
(h) Severability. If any provision
of this Agreement shall be held invalid or unenforceable, such invalidity or
unenforceability shall attach only to such provision and shall not in any
manner affect or render invalid or unenforceable any other severable provision
of this Agreement, and this Agreement shall be carried out as if any such
invalid or unenforceable provision were not contained herein.
(i) Amendments. This Agreement
may not be amended except in a writing signed by all of the parties
hereto.
(j) Counterparts. This Agreement
may be executed in several counterparts, each of which shall be deemed an
original but all of which shall constitute one and the same
instrument. In addition, this Agreement may contain more than one
counterpart of the signature page and this Agreement may be executed by the
affixing of such signature pages executed by the parties to one copy of the
Agreement; all of such counterpart signature pages shall be read as though one,
and they shall have the same force and effect as though all of the signers had
signed a single signature page. A facsimile signature shall have the
same force and effect as an original thereof
(k) Third
Parties. Except as
specifically set forth or referred to herein, nothing herein expressed or
implied is intended or shall be construed to confer upon or give to any person
or corporation other than the parties hereto and their successors or assigns any
rights or remedies under or by reason of this Agreement.
(l) Attorneys’
Fees. In the event any party hereto shall commence legal
proceedings against the other to enforce the terms hereof, or to declare rights
hereunder, as the result of a breach of any covenant or condition of this
Agreement, the prevailing party in any such proceeding shall be entitled to
recover from the losing party its costs of suit, including reasonable attorneys'
fees, as may be fixed by the court.
IN WITNESS WHEREOF, the
parties hereto have executed this Agreement as of the day and
year
first above written.
|
Who’s
Your Daddy, Inc.
|
Net
Vertex New York Inc.
|
||||
|
By:
|
/s/ Xxxxxxx Xxxx
|
By:
|
/s/ Xxxx
Xxxxxxxxx
|
||
|
Xxxxxxx
Xxxx, CEO
|
Xxxx
Xxxxxxxxx, President
|
||||
