Exhibit 10.15
CONSULTING AGREEMENT
CONSULTING AGREEMENT, made as of March 1, 2002, by and between XXXXXXXXX
ENERGY CORPORATION, a Delaware corporation having a principal place of business
at Xxxxxxxx, Xxxxx 00000 (the "Company"), and ALTERNATE ENERGY, LLC, a New York
limited liability company with offices at 00 Xxxxxxx Xxxxx, Xxxx0xx, Xxx Xxxx
00000 (the "Consultant").
WITNESSETH;
WHEREAS, the Company is aware of Consultant's skills and knowledge with
reference to advising companies on how to build and grow businesses and desires
to engage the Consultant to serve as a consultant to the Company by advising the
Company on (he terms and conditions hereinafter set forth;
WHEREAS, the Consultant desires to provide such consulting services to the
Company on the terms and conditions hereinafter set forth; and
WHEREAS, the Company has issued to Consultant thirteen million five-hundred
thousand (13,500,000) Shares of Company common stock representing at least 50%
of the total outstanding stock of the Company on a fully diluted basis
including, but not limited to issuances of options, warrants, and similar stock
rights, etc. in consideration for services rendered by Consultant to Company
(Shares);
NOW THEREFORE, in consideration of the mutual terms, covenants, agreements
and conditions hereinafter set forth, the Company and the Consultant hereby
agree as follows:
1. Engagement. The Company hereby engages the Consultant to provide
consulting services to the Company and the Consultant hereby accepts such
engagement.
2. Term, Unless earlier terminated as provided in this Agreement, the term
of this Agreement shall be for a period of twenty-five (25) years beginning on
March 1, 2002. (the "Engagement Date") and ending on the twenty-fifth
anniversary thereof (the "Term").
3. Financing Services. Consultant agrees that it will provide Or arrange
for a third party solicited by Consultant to provide at least one of the
following for the benefit of the Company within fourteen (14) months from the
date hereof: (a) arranging for six-hundred fifty thousand dollars ($650,000.00)
(or any greater amount as the parties hereto may mutually agree) of purchase
money mortgage financing to purchase the equipment listed on schedule A attached
hereto (or other equipment to be used by the Company), (b) providing for a lease
arrangement for said equipment for the Company (in such principal sum as above
stated), or (c) arranging financIng for a financial project (in such principal
sum as above stated) for the Company or in which the Company has a financial
interest.
The Company represents that said financing as described herein is to be
used to purchase or lease equipment, or to complete any financing project
involving the Company or any entity in which the Company has an economic
interest, and Consultant or any other entity providing said funds shall have a
first priority security interest in such equipment, and, at the sole discretion
of the Consultant, a second security interest in all other assets of the
Company. Any such purchase money mortgage financing, lease arrangement,
or financing shall be on reasonable terms and in any event on terms at least as
favorable as market for companies similar to the Company.
The Company agrees to use its best efforts to facilitate the loan, lease,
or finance transactions contemplated under this paragraphS and agrees to provide
a Security Agreement (and UCC filing) to secure equipment to be purchased or
leased by the Company with the proceeds, or to execute such other documents as
the seller, lender, or other party to the financing arrangement may reasonably
require in connection therewith.
In the event Consultant should fail to provide or arrange for the provision
of at least one of the items set forth in (a), (b), or (c) above within fourteen
(14) months from the date hereof, then Consultant agrees to pay to the Company
liquidated damages in the amount of Two Million Dollars ($2,000,000). The
Company agrees to accept such sum as liquidated damages (not as a penalty), and
such liquidated damages shall be the exclusive remedy of the Company.
4. Consulting Services. Upon request by the Company by telephone, fax or
email, the Consultant, by telephone, fax or email, will provide consultation to
the Company concerning business projects, financing opportunities and strategic
planning. This shall be done on a reasonable best efforts basis by Consultant
and Consultant makes no guarantees regarding Company's ability or prospects. The
Company is aware of Consultant's skills and knowledge. The Company will not
require the Consultant to do any traveling outside of Suffolk County, New York.
Consultant may select employees to perform such services as Consultant in its
sole discretion shall decide, from time to time.
5. Fees. The Company acknowledges that services previously performed by
Consultant in the business start-up phase provided and continues to provide
material benefits to the Company in structuring its growth and business
strategy. In consideration for the servIces the Consultant has rendered and
shall render to the Company hereunder, the Company shall pay to the Consultant,
a continuing Consideration Fee equal to ten percent (10%) of Company's pre-tax
profits before depredation and amortization and before deductions for stock
based compensation (including, but not limited to stock options) and before any
non-cash expenditures. Such Consideration Fee, to the extent there is a profit,
shall be paid to Consultant in quarterly installments within sixty (60) days
after each calendar quarter, with a yearly adjustment after the annual
financials are completed, but not later than April 15 of The year following the
year in question. Provided, that the Consideration Fee for calendar year 2002
shall be payable In a single payment not later than April 15, 2003. The Company
shall use a Certified Public Accountant and keep its financial records for the
purpose of complying with this Agreement in accordance with Generally Accepted
Accounting Principals and will provide quarterly reports and the annual
financials to Consultant to verify such. rot the purpose of this Agreement
pre-tax profits shall be those reported on the audited or reviewed financial
statements presented using Generally Accepted Accounting Principals consistently
applied and shall include (to the extent not already reflected on the audited or
reviewed financial statements) all capital and/or extraordinary gains and the
Company's ratable share of the pre-tax profits (computed in the same manner as
described above for the Company) of any other entity in which the Company owns
an equity interest of at least one percent (1%). The Consultant shall have the
right to inspect the books of the Company to verify the Consideration Fee as
described herein.
6, Right of First Refusal. The Company grants to the Consultant a right of
first refusal on all fundings the Company seeks, whether in the form of loans or
capital infusion. The Company will provide to the Consultant notification of
such funding needs and the Consultant shall have twenty (20) days after receipt
of such notification to provide to the Company a Letter of Intent acceptable to
the Company, with the proposed terms of such funding. The Right of First Refusal
rights as described herein, and whether or not a right of first refusal is
exercised by the Consultant and/or a
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Letter of Intent is accepted by the Company, shall not affect Consultant's right
to receive the Consideration Fee under Section 5.
7. Provisions Regarding Stock. Until a certain Note for up to $800,000.00
between the Company and Alternate Power. Inc. a Texas Corporation (API) and any
additional project financing (general illustrations of which are included as
Exhibit B) obligations of the Company to API; or any entity introduced by, or
related thereto (or controlled by the same persons as API), is paid in full, the
parties hereto agree that Consultant shall always have the right to maintain an
ownership interest in the Company of at least fifty percent (50%) of Company's
outstanding shares on a fully diluted basis. Upon request, the Company agrees to
provide statements of the number of its outstanding shares, The parties hereto
agree not to enter into any agreements or transactions which would or may cause
Consultant to fail to maIntain at least fifty percent (50%) of Company's
outstanding shares on a fully diluted basis. If the Company does issue (in any
fashion whatsoever) any additional shares, warrants, or options after the date
hereof, the Company agrees to give Consultant an equal or greater number of
shares that is sufficient for Consultant to maintain ownership of at least fifty
percent (50%) of Company's outstanding shares on a fully diluted basis. For the
purposes herein, fully diluted shall include, but not be limited to issuances of
options, warrants, and similar stock rights, etc.
8. Independent Contractor Status, The Consultant recognizes and
acknowledges that the relationship between the Company and the Consultant is
that of client and independent contractor and not that of an employer and
employee. In this regard, the Consultant acknowledges that Consultant is solely
responsible for the payment of Consultant's own Federal, state and local income
taxes, as well as any payroll taxes for Consultant's employees. The Consultant
further acknowledges that the Consultant may not bind the Company to any
agreement or contract or in any other respect without the Company's consent.
9. Developments and Confidential Information. The Consultant hereby
covenants, agrees and acknowledges as follows:
(a) Any and all inventions, products, discoveries, improvements,
processes, manufacturing, marketing and services methods or techniques,
formulae, designs, styles, specifications, data bases, computer programs,
know-how, strategies and data, whether or not patentable or registrable under
copyright or similar statutes, made, developed or created by the Company shall
constitute confidential information and remain property of the Company.
(b) Notwithstanding the foregoing, the following will not constitute
confidential information for purposes of this Agreement: (i) information which
was already in the Consultant's possession prior to its receipt from the
Company, (ii) information which is obtained by the Consultant from a third
person who is not otherwise known by the Consultant to be prohibited from
transmitting the information to the Consultant by a confidentiality agreement,
or (iii) information which is or becomes publicly available other than as a
result of disclosure by the Consultant
10. Termination.
(a) Following the expiration of fourteen (14) months from the date
hereof, either party may terminate this Agreement on 120 days prior written
notice, but no such termination shall affect the Company's rights with respect
to any breach by Consultant of its obligations under paragraph 3.
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(b) Notwithstanding anything herein to the contrary, in the event that
the Company has terminated the Consultant's consultancy the Company shall
continue to pay the Consultant the Consideration under Section 5 until the end
of the Term.
11. Assignability. This Agreement and all rights, interests and obligations
hereunder may be transferred and/or assigned by the Consultant without the
Company's prior written consent.
12. Binding Effect. Without limiting or diminishing the effect of Section 9
hereof, this Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective heirs, successors, legal representatives and
assigns.
13. Notice. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and either delivered in person or
sent by first class certified or registered mail, postage prepaid, if to the
Company, at the Company's principal place of business, and if to the Consultant,
at Consultant's address set forth on the signature hereto, or to such other
address or addresses as either party shall have designated in writing to the
other party hereto.
14. Severability. The Consultant agrees that in the event that any court of
competent jurisdiction shall finally hold that any provision of this Agreement
is void or unenforceable, such provi5ion shall riot be rendered void but shall
apply to such extent as such court may judicially determine constitutes a
reasonable restriction under the circumstances. If any part of this Agreement is
held by a court of competent jurisdiction to be invalid, illegible or incapable
of being enforced in whole or in part by reason of any rule of law or public
policy, such part shall be deemed to be severed from the remainder of this
Agreement for the purpose only of the particular legal proceedings in question
and all other covenants and provisions of this Agreement shall in every other
respect continue in full force and effect and no covenant or provision shall be
deemed dependent upon any other covenant or provision.
15. Waiver. Failure to insist upon strict compliance with any of the terms,
covenants or conditions hereof shall not be deemed a waiver of such term,
covenant or condition, nor shall any waiver or relinquishment of any right or
power hereunder at any one or more times be deemed a waiver or relinquishment of
such right or power at any other time or times.
16. Entire Agreement; Modifications. This Agreement constitutes the entire
and final expression of the agreement of the parties with respect to the subject
matter hereof and supersedes all prior agreements, oral and written, between the
parties hereto with respect to the subject matter hereof. This Agreement may be
modified or amended only by an instrument in writing signed by both parties
hereto.
17. Govening Law. This Agreement shall be construed and enforced in
accordance with the internal laws of the State of New York without regard to the
conflicts of law principles thereof.
18. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Company and the Consultant have duly executed and
delivered this Agreement as of the day and year first above written.
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Xxxxxxxxx Energy Corporation
By: /s/ Xxxx Xxxxxx
---------------------------
Xxxx Xxxxxx, President
Alternate Energy, LLC
By: /s/ Xxxxxx Xxxxxx
---------------------------
Xxxxxx Xxxxxx, President
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COMPLIANCE ACKNOWLEDGEMENT
--------------------------
COMPLIANCE ACKNOWLEDGEMENT, made as of June 7, 2002, by and between
XXXXXXXXX ENERGY CORPORATION, a Delaware corporation having a principal place of
business at Xxxxxxxx, Xxxxx 00000 (the "Company"), and ALTERNATE CAPITAL, LLC,
(formerly ALTERNATE ENERGY LLC), a New York limited liability company with
offices at 00 Xxxxxxx Xxxxx, Xxxxxxx, Xxx Xxxx 00000 (the "Consultant").
WITNESSETH:
WHEREAS, the Company has entered into a Consulting Agreement with
Consultant, dated March 1, 2002; and
WHEREAS, the Consulting Agreement required the Consultant to provide
certain financing services to the Company;
NOW THEREFORE, in consideration of the sum of TEN DOLLARS ($10.00) and such
other consideration the receipt and sufficiency of which is hereby acknowledged,
and in consideration of mutual terms, covenants, agreements and conditions
hereinafter set forth, the Company and Consultants hereby agree as follows:
1. Consultant shall be entitled to retain the 13,500,000 shares of the
Company's common stock without any penalty related thereto, and the Company
agrees that it has no right, title or interest whatsoever in said shares of the
Company's common stock.
2. Other provisions of the Consulting Agreement remain in full force and
affect except as modified herein.
Xxxxxxxxx Energy Corporation
By: /s/ Xxxx Xxxxxx
----------------------------------
Xxxx Xxxxxx, President
Alternate Capital, LLC
(Formerly Alternate Energy LLC)
By: /s/ Xxxxxx Xxxxxx
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Xxxxxx Xxxxxx, President
