Consulting Agreement
Agreement, made on the 12th day of July 1999, by and between Acceleration
Software International Corporation, 0000 XX Xxxx Xxxx Xxxx, Xxxxxxx, XX 00000
(the "Company") and Millennium Capital Quest, 000 Xxxxxx Xxxx., Xxxxxxx, XX
00000 (the "Consultant")
In consideration of the mutual covenants contained herein, the parties hereto
agree as follows::
1. The Consultant, together with Xxxxx X. Xxxxx, Chairman/CFO, C. Xxxxx
Xxxxxxxx, President/CEO and X. Xxxxxx, CIO, for the Consultant will provide
consulting services consisting of financial public relations, advise regarding
corporate structuring and marketing advice. Additionally, the Consultants
shall assist Company management and legal counsel in structuring the Company
for expanded marketing operations and business development and other general
management consulting services as required during the term of this Agreement.
Further the Consultants will coordinate communication with the Board of
Directors, appropriate federal agencies, internet webpage developers and
ISP's, affiliated companies, banking institutions, investment banks, equity
investor groups and by assisting attorneys and accountants selected by the
Company familiar with such procedures. The Consultants shall advise the
Company on structure of the promotion, and assist the Company in development
of its financial marketing plan.
2. Further, the Consultants will prepare a summary financing plan, assist
attorneys who will review draft offering memorandum, facilitate web site
productions for the internet and act as a consultant to the attorney and
accountants for the Company and assist attorneys and accountants where
necessary. The Consultants acknowledge that all "Confidential Information"
provided to them by the Company is proprietary and shall be treated in strict
confidence. Further, The Consultants agree that the distribution of any such
information to third parties in the normal course of business and the
operations of this engagement shall only be made upon the written consent of
the Company. Further, the Consultants agree to return any Confidential
Information upon the termination or conclusion of the assignment. For purposes
of this Agreement, the term "Confidential Information" means any Company
proprietary information, technical data, trade secrets or know-how, including,
but not limited to, computer software, documentation, research, product plans,
products, services, suppliers, customer lists, prices and costs, markets,
developments, inventions, notebooks, processes, formulas, technology, designs,
drawings, engineering, hardware configuration information, marketing,
licenses, finances, budgets or other business information disclosed to
Consultant by Company either directly or indirectly in writing, orally or by
drawings or observation. Confidential Information includes, but is not limited
to, information pertaining to any aspects of the Company's business which is
either information not known by actual or potential competitors of the Company
or is proprietary information of the Company or its customers or suppliers,
whether of a technical nature or otherwise.
3. The Company fully understands that the Consultants are not lenders,
broker-dealers, investment bankers, underwriters or securities sales agents in
any form. They do not have or control investment capital. The Consultants may
not by law, solicit the sale of any securities for any compensation
whatsoever, but will act as financial and public relations advisors to the
Company and advise the Company on presentations to new business clients and
its full range of financial resources. Consultant is an independent
contractor. This Agreement shall not create nor be deemed to create any other
relationship between Company and Consultant. Neither Consultant nor any of its
agents shall create any obligation, responsibility, express or implied, on
behalf of or in the name of Company or by Company in any way except as
specifically authorized in this Agreement. Consultant shall maintain its own
workers' compensation coverage, and shall pay any and all tax due on amounts
it receives hereunder, and neither Consultant nor any of its agents or
employees shall be entitled to participate in or receive benefits under any
Company employee-benefit plans.
4. It shall be the Consultant's specific task to assist the Company by
rendering advice and assistance to a competent securities attorney and provide
the Company advice in marketing efforts. The Company understands that due to
the many variables involved, the Consultants make no representation whatsoever
as to its opinion of the Company's ability to sell any securities, such
opinion coming from the Company's attorney.
5. The Company agrees to compensate the Consultants for the work performed to
date and to be performed under this Agreement, based upon achieving certain
milestones, including development of financial and business plans and
development of a business financing package for the Company according to the
following schedule and as outlined below:
A. Consultants will be entitled to payments from Company in accordance with
the following:
(i) $25,000.00 upon the start of the preparation of Company disclosure
documents and its required attachments, marketing materials and its website;
(ii) $12,500.00 upon filing with the SEC of a registration statement on
form SB-2. (It being further understood that the entire package shall be
reviewed and filed subject to the advice of counsel for the Company and the
attachment of the opinion and consent letters of counsel);
(iii) $50,000 upon the Company having $3,000,000 in cash in the bank;
(iv) $100,000 upon the Company having $18,000,000 in cash in the bank; and
(v) A grant under the Company's 1999 stock option plan of options to
purchase shares of common stock of the Company for a ten (10) year period
at an exercise price of $1.50 per share in an amount equal to 0.1% of the
common stock of the Company outstanding.
Any fees actually paid to the Consultants are non-refundable and shall be
used to conduct due diligence, investigation of the corporate financing plan
and development program as appropriate and to coordinate the structure
of financings with legal and accounting counsel.
B. Further, all other fees and costs incurred by the Company on its own
behalf, such as legal, accounting, printing, promotion and travel are those of
the Company. In consideration of the above Agreements, the Consultants agree
to provide to the Company, financial public relations services, marketing and
consultation services, and its advise on document structure, filing, blue sky
regulations, contacting Investors, Syndicators, Broker-Dealers, databases and
access to its Web Page developer, telemarketing, internet and computer
systems.
6. The Company agrees to reimburse the Consultants for clerical, printing,
media placement, and other out-of-pocket expenses, if incurred, in connection
with its services to the Company. All such expenses shall be approved in
advance by the Company. These expenses shall include any advertising credit
advanced to the company by the consultants, to be repaid from the minimum
proceeds of the offering. At the sole discretion of the Company, ad credit may
be advanced to the Company in an amount not to exceed $500,000.00
7. In addition to the functions to be performed in connection with the
offering pursuant to this agreement, the consultants agree to make themselves
additionally available to the Company at all reasonable times as necessary for
the duration of the consulting and marketing phase of the project. This
Agreement may be terminated with or without cause by either party on thirty
days written notice. Unless terminated for cause by Company (which includes
any failure by the Consultants to abide by all terms of this agreement) (a)
the parties agree to delivery of all agreed-upon work product and the payment
of all installment fees and reimbursement of all outstanding pre-agreed upon
expenses of the Consultants due through the date of
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termination, and (b) in the event that at the date of Company's termination
notice, the Company shall have an effective offering, be in the process of
fund raising and materially be using the work product of the Consultants to
raise capital in accordance with this Agreement, the Company agrees to
provide proof of funds raised to date and pay to the Consultants the
compensation described in items (iii) through (v) in paragraph 5.A. above.
8. The Company understands that the Consultants must at all times rely upon
the information supplied to the Consultants by its members, managers,
officers, directors, agents and employees. Therefore, the Company agrees to
indemnify, hold harmless and defend the Consultants, its officers, directors,
agents and employees at the Company's expense (including attorneys' fees)
arising from any proceeding or suit relating to any material inaccuracy or
incompleteness of any information supplied to the Consultants by the Company,
and violation of any state or federal securities, franchise or business
opportunity law committed by the Company. The Consultants agree to indemnify,
hold harmless and defend the Company, its officers, directors, agents and
employees at the Consultant's expense (including attorneys' fees) in any
proceedings or suit and for any damages due to any negligence or unlawful or
intentional misconduct on the part of the Consultants, its agents or
employees.
9. The Company and the Consultants mutually agree that this Agreement and all
provisions and rights hereto shall not be assigned to any other party without
the mutual consent in writing by both parties to this Agreement. This
Agreement shall be binding on all sucessors and assigns of the parties hereto.
10. This contract shall be construed in accordance with the laws of the State
of Washington. The Company represents it will be in compliance with and
authorized to do business in any additional states in which it is required to
do so. Further, the parties agree that all disputes shall first be subject to
resolution by arbitration according to the rules and provisions defined by the
American Arbitration Association. Any arbitration shall be conducted in King
County, Washington. The arbitrators shall have no authority to award any
punitive or exemplary damages, or to vary or ignore the terms of the
Agreement. The costs of arbitration, including reasonable attorneys' fees
incurred by the prevailing party (including any such costs incurred on
appeal), shall be paid to the prevailing party by the party designated as such
by the arbitrator (or court, as applicable).
11. The term of this contract shall be for a period of 12 months, renewable by
mutual agreement of the parties.
12. The parties reserve the right to the control and use of their names and
all symbols, trademarks, or service marks presently existing or later
established. Neither party shall use the other party's name, symbols,
trademarks, or service marks or such marks as such party controls in
advertising or promotional materials or otherwise without the prior written
consent of such other party. Any use by a party, without the approval of the
other party, of the name, symbols, trademarks or service marks of such other
party shall cease immediately upon the earlier of written notice of such other
party or termination of this Agreement. Each party hereby grants the other the
right to use its name, address and telephone number in connection with the
other party's obligations hereunder.
13. Prior Agreements. No other prior agreements exist.
In witness whereof, the parties hereto have executed this Agreement on
the date above written.
MILLENNIUM CAPITAL QUEST CORP.
"The Consultants"
/s/ Xxxxx X. Xxxxx
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Authorized (for MCQ)
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ACCELERATION SOFTWARE INTERNATIONAL CORPORATION
"The Company"
/s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx, CEO
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