Exhibit 10.3
AGREEMENT
THIS AGREEMENT (this "Agreement") is made and entered into as of
January 11, 1999, by and between XXXX X. XXXXXXXX, XX. ("Xxxxxxxx") and
XXXX X. XXXXXX ("Xxxxxx", together, the "Consultants"), and AMERICAN
TECHNOLOGIES GROUP, INC., a Nevada corporation ("ATG").
R E C I T A L S:
----------------
WHEREAS, ATG desires the assistance of the Consultants in establishing
a business relationship with [Cosmetic Firm] ("CF")(the "Services");
WHEREAS, the Consultants have the ability to introduce ATG to CF and
facilitate a business relationship between ATG and CF.
NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual covenants contained herein, ATG and the Consultants hereby agree as
follows:
1. ENGAGEMENT. Upon the terms, and subject to the terms and conditions,
contained herein, ATG hereby engages the Consultants to provide the Services and
the Consultants agrees to provide the Services as provided herein.
2. FEES.
2.1 CONDITIONS FOR PAYMENT. Compensation for the Services
shall be paid to the Consultants in the amounts indicated upon the consummation
of the agreements between ATG and CF indicated:
a) If CF and ATG enter into a formal joint testing agreement
regarding ATG's proprietary IE(TM) Crystal technology (the "Technology"), ATG
shall issue the Consultants fifty thousand (50,000) shares of ATG Common Stock;
and
b) If CF and ATG enter into a formal agreement pursuant to
which ATG receives revenue from CF in connection with the use of the Technology
by CF, other than for the purchase of IE Crystals for testing purposes, ATG
shall issue the Consultants fifty thousand (50,000) shares of ATG Common Stock
and pay a commission of ten percent (10%) of ATG's net profit's under the
agreement. Net profit is total revenue received by ATG under such agreement less
all costs of ATG associated with such agreement plus an additional ten percent
(10%) as an allocation of overhead incurred in connection therewith.
2.2 VALUE. All shares delivered under Section 2.1 (the
"Shares") shall be valued at $0.75 per share.
2.3 REGISTRATION. The Shares to be delivered to the
Consultants hereunder shall be delivered upon registration of the Shares under
the Securities Act of 1933 on Form S-8. ATG shall use its best efforts to cause
the registration of the Shares as soon as practicable after issuance.
2.4 STOCK OPTION. As additional compensation to the
Consultants hereunder, ATG hereby grants to each Consultant the right and option
to purchase (the "Options"), on the terms and conditions hereinafter set forth,
one hundred twenty-five thousand (125,000) shares of ATG Common Stock at $0.75
per share (the "Option Shares") vesting if CF and ATG enter into a formal
agreement pursuant to which ATG receives revenue from CF in connection with the
use of the Technology by CF, other than for the purchase of IE Crystals for
testing purposes. To the extent that the Option is not vested upon the
termination or other expiration of this Agreement, the Option shall expire and
be null and void.
2.5 OPTION TERM. Once exercisable, the Options shall remain so
exercisable until three years after the date of vesting and thereafter shall be
null and void.
2.6 REPRESENTATIONS. The Consultants hereby warrant and
represent to ATG as follows, each of which representation and warranty is
material and is being relied upon by ATG and each of which is true at and as of
the date hereof and will be true at the time of exercise of the Options:
2.6.1 that the Consultants are acquiring the
Options, and upon exercise of an Option will acquire the Option Shares, for
their own account and not with a view to their resale or distribution and that
the Consultants are prepared to hold the Option and the Option Shares, if
acquired, for an indefinite period and have no present intention to sell,
distribute or grant any participating interests in the Options or the Option
Shares, if acquired. The Consultants hereby acknowledge the fact that the Option
Shares will not be registered under the Securities Act of 1933, as amended (the
"1933 Act") or any applicable state securities laws.
2.6.2 that the Consultants have been informed
that the Options and the Option Shares may not be resold or transferred
unless first registered under Federal and state securities laws or unless an
exemption from such registration is available. Accordingly, the Consultants
hereby acknowledge that
2
each Consultant is prepared to hold their respective Option and the Option
Shares for an indefinite period of time.
2.6.3 that each Consultant has a preexisting
business or personal relationship with ATG, that he is aware of the business
affairs and financial condition of ATG and that each Consultant has such
knowledge and experience in business and financial matters with respect to
companies in business similar to ATG to enable him to evaluate the risks of
the prospective investment and to make an informed investment decision with
respect thereto. The Consultants further acknowledge that ATG has made
available to them the opportunity to ask questions and receive answers from
ATG concerning the terms and conditions of the issuance of the Options and
the Option Shares and that they could be reasonably assumed to have the
capacity to protect their own interests in connection with such investment.
2.6.4 that the Consultants realize that their
purchase of the Options and the Option Shares is a speculative investment and
that they are each able, without impairing their financial condition, to hold
the Options and the Option Shares for an indefinite period of time and to
suffer a complete loss of their investment.
3. NO TRANSFER: The Consultants shall not transfer, encumber, alienate
or dispose, by gift or otherwise, all or any part of the Option Shares, except
as may be permitted by law.
5. RESTRICTIVE LEGEND: In order to reflect the restrictions on
disposition of the Option Shares, the stock certificates for such shares will be
endorsed with the a legend substantially as follows:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
PURSUANT TO THE SECURITIES ACT OF 1933 OR APPLICABLE STATE LAW, AND MAY
NOT BE SOLD, ASSIGNED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION THEREUNDER OR AN OPINION OF COUNSEL SATISFACTORY
TO THE ISSUER TO THE EFFECT THAT SUCH REGISTRATION IS NOT REQUIRED.
6. TERM. If CF and ATG fail to enter into a formal agreement pursuant
to which ATG receives revenue from CF in connection with the use of the
Technology by CF, other than for the purchase of IE Crystals for testing
purposes, before December 31, 2001, this Agreement shall terminate.
3
7. GENERAL PROVISIONS.
7.1 SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of, and be binding upon, the respective successors and assigns of the
respective parties hereto; PROVIDED, HOWEVER, that neither party hereto shall
have the right to assign any of its rights under this Agreement without the
prior written consent of the other party.
7.2 NOTICES. All notices, requests, demands and other
communications which may be given or are required to be given under this
Agreement shall be in writing and in the English language. All notices shall be
sent by facsimile transmission and confirmed by overnight courier, and shall be
deemed given on the date of such facsimile transmission. All notices shall be
addressed as set forth below:
If to Xxxxxxxx: X.X. Xxx 0000
Xxxxxxxx, XX 00000
If to Xxxxxx: 0000 Xxxx Xxxx
Xxxxxx, XX 00000
If to ATG: American Technologies Group, Inc.
0000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxxx X. Xxxxx
or to such other address as each party hereto may from time to time designate by
written notice to the other party as provided herein.
7.3 GOVERNING LAW. This Agreement has been executed and
delivered in, and shall be governed by and construed in accordance with the
laws of the State of California without regard to its conflict of laws
provisions.
7.4 RESOLUTION OF DISPUTES. Any controversy or claim
relating to this Agreement (whether contract, tort, or both) or to the breach
of this Agreement shall be arbitrated by and in accordance with the then
existing commercial arbitration rules of the American Arbitration
Association, in Los Angeles, California. The arbitrator may render a judgment
awarding actual compensatory damages only, and no consequential, incidental,
or punitive damages may be awarded by the arbitrator. Judgment on the award
rendered by such arbitrator may be entered in any court having jurisdiction.
Nothing in this Section 7.4 shall affect ATG's right to bring an action or
proceeding against the Consultants in the courts of any jurisdiction where
the purpose of such action or proceeding is to seek injunctive relief against
the Consultants.
4
Service of process in any such action or proceeding brought hereunder may be
made by mailing copies of such process to the address of the parties provided
for in Section 7.2 hereto, provided that nothing in this Section 7.4 shall
affect the right to serve legal process in any other manner permitted by law.
In the event of any action or proceeding to enforce this Agreement, the
successful or prevailing party will be entitled to recover its attorneys'
fees actually incurred and other costs incurred in any such action or
proceeding, in addition to any other relief to which it may be entitled.
7.5 HEADINGS. The headings herein are for convenience only, do not
constitute a part of this Agreement, and shall not be deemed to limit or
affect any of the terms or provisions hereof.
7.6 WAIVER AND AMENDMENT. No waiver, amendment, modification or
change of any provision of this Agreement shall be effective unless and until
made in writing and signed by all of the parties hereto. No waiver,
forbearance or failure by any party hereto of its right to enforce any
provision of this Agreement shall constitute a waiver or estoppel of such
party's right to enforce any other provision of this Agreement or a
continuing waiver by such party of compliance with any provision.
7.7 SEVERABILITY. The provisions of this Agreement are intended to
be interpreted and construed in a manner so as to make such provisions valid,
binding and enforceable. In the event that any provision of this Agreement is
determined to be partially or wholly invalid, illegal or unenforceable, then
such provision shall be deemed to be modified or restricted to the extent
necessary to make such provision valid, binding and enforceable, or, if such
provision cannot be modified or restricted in a manner so as to make such
provision valid, binding and enforceable, then such provision shall be deemed
to be excised from this Agreement and the validity, binding effect and
enforceability of the remaining provisions of this Agreement shall not be
affected or impaired in any manner.
7.8 COOPERATION. Each party hereto shall cooperate with the other
party hereto and shall take such further action and shall execute and deliver
such further documents as may be necessary or desirable in order to carry out
the provisions and purposes of this Agreement.
7.9 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of
which together shall constitute one and the same instrument.
5
7.10 ENTIRE AGREEMENT. This Agreement (including the exhibits and
schedules hereto, each of which is incorporated herein and made a part of
this Agreement) constitutes the entire agreement and understanding of the
parties hereto and terminates and supersedes any and all prior agreements,
arrangements and understandings, both oral and written, express or implied,
between the parties hereto concerning the subject matter of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the date first written above.
"ATG" "CONSULTANTS"
AMERICAN TECHNOLOGIES GROUP INC.
By: /s/ Xxxxxxxx X. Xxxxx /s/ Xxxx X. Xxxxxxxx, Xx.
---------------------- -------------------------
Name: Xxxxxxxx X. Xxxxx Xxxx X. Xxxxxxxx, Xx.
Its: Chairman
/s/ Xxxx X. Xxxxxx
------------------
Xxxx X. Xxxxxx
6
