Contract
|
This CONSULTING
AGREEMENT (this "Agreement") is made on August 1, 2008, by and
between CS Financing
Corporation, a Delaware Corporation with its principal place of
business at 00 Xxxxx Xxxxx Xxxx. Xxxxx #000 xx Xxxxx Xxxxxx Xxxxxxxxxx
00000 (the “Client”) and The National Research Exchange,
Inc. ("NRE"), a Delaware
Corporation with its principal place of business at 000 Xxxx 00xx
Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000.
WHEREAS, Client is a
mezzanine real estate lender who raises capital through the sale of
publicly registered notes and which capital is then lend to mezzanine real
estate development projects, and where the interest spread between these
activities generates the revenue to manage and grow the
business.
WHEREAS, Client is a
privately owned company that seeks consulting advice to re-structure and
re-capitalize its business (“Services”): principally to – (1) structure,
market and price additional equity capital in the most advantageous manner
to Client and its existing shareholders; (2) to assist Client in finding a
“statutory” underwriter (as required under FINRA rule 2720) for
its publicly issued notes to permit regulatory approval by FINRA for the
distribution of the publicly issued notes as well as possible use Clients’
broker-dealer in the distribution; (3) to develop and implement
marketing plans for the sale of the publicly registered
notes; (4) to develop and implement a business organization
plan for Client’s business functions and staff (including possible
acquisitions of staff and systems) which business units might include –
management, capital raising through publicly issued notes, and mezzanine
loan origination, underwriting, and administration activities; and (5) to
assist Client in finding appropriate legal counsel to assist Client in its
recapitalization and re-structuring and determining the best ways to
accomplish the business goals within the context of the regulatory
environment in the securities and financial areas. the .
WHEREAS, NRE is skilled
and experienced in the performance of such Services and related activities
and desires to perform such Services for Client under the terms and
conditions set forth herein,
NOW THEREFORE, for good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows
1. Services. Client hereby
engages NRE, and NRE hereby agrees to be engaged by Client, to perform the
Services on the terms and conditions set forth in this Agreement. NRE is
free to perform work on behalf of entities other than Client that do not
offer goods and services competitive with Client, but shall devote
sufficient time to the performance of the Services under this Agreement as
shall be reasonably necessary to effectively perform those Services and
protect the interests of Client.
1.1. NRE
shall provide the Services to Client through the persons of
Xxxxx Xxxxx and Xxxxxx Xxx, and such other persons as NRE and the Client
may agree upon.
2.
Term. This
Agreement shall remain in full force and effect for a term of four (4)
months commencing on August 1, 2008 and ending on November 30,
2008.
2.1.
Renewal. The Agreement shall be automatically renewed on a
month-by-month basis after the termination date of this Agreement and
either party may terminate the Agreement upon 30 day prior written notice
to the other party.
3. Price and Payment
Terms.
3.1.
Client shall pay NRE a monthly fee of $35,000 (“Monthly
Fee”). Payment shall be made in advance for the month for which
the fee is paid, with the exception of the first month which shall be paid
upon execution of this Agreement.
3,2,.
The Monthly fee shall not include any travel-related
expenses. Client shall be responsible for all travel-related
expenses (including, but not limited to, coach airfare and standard
business-class hotel accommodations) incurred by NRE during performance of
the Services; provided that Client has approved such
expenses. NRE shall keep accurate records of all such expenses,
and Client shall have the right upon reasonable notice, to audit at any
time up to one (1) year after payment of its final invoice, the
travel-related expenses incurred in connection with the
Services.
3.2.1. Client
has pre-approved a monthly travel allowance of $5,000. NRE
shall provide Client with all travel related expense records as required
under section 3.2 above.
3.3. Travel-related
expenses approved by Client shall be paid within 45 days of the submission
of such travel-related expenses to Client by NRE.
3.4.
If Client disputes in good faith any invoice rendered or amount paid,
Client shall notify NRE, and the parties will use their best efforts to
resolve the disputed expenditures. The time for paying the portion of the
invoice in dispute shall be extended until the dispute is
resolved.
4.
Payment of Taxes.
Beginning on the date of this Agreement, NRE shall be responsible for
payment of all taxes arising from NRE’s engagement under this Agreement
and all compensation paid to NRE, or any of NRE’s employees, by Client
under this Agreement, including federal, state and local income taxes and
applicable Social Security (FICA) and/or self-employment taxes. NRE agrees
to indemnify and hold harmless Client for all expenses and costs,
including attorneys’ fees, incurred as a result of NRE’s non-payment of
taxes.
5.
Termination.
5.1.
Client and NRE shall not have the right to terminate this Agreement prior
to the expiration of the Term of this Agreement except for cause as
described in section 5.2 below.
5.2.
If either party is in default of its obligations under this Agreement and
the default continues for ten (10) days after written notice is sent by
the party not in default, the non-defaulting party may, in addition to all
other rights and remedies provided by law or this Agreement, terminate
this Agreement.
5.3.
The following provisions shall survive any expiration or termination of
this Agreement: Sections 3, 4, 5, 6, 7, 8, 9, 10, 11 and 12.
6.
Status of Parties.
NRE, and all employees or independent contractors of NRE, shall be, and at
all times during this Agreement shall remain, an independent contractor in
relation to Client. NRE shall not represent himself as an employee,
partner or joint venturer of Client. NRE has no authority whatsoever to
bind Client, nor shall NRE represent that it has any such authority,
express, implied or otherwise. NRE agrees that it shall not negotiate or
enter into any oral or written contract, agreement or arrangement on
behalf of, or in the name of, Client. NRE shall perform the Services under
the general direction of Client as to the result of such activity, but NRE
shall determine, in NRE's sole discretion, the manner and means by which
the Services are accomplished, subject to the express condition that NRE
shall at all times comply with applicable laws. Client expressly
acknowledges that it has no right or authority to control or supervise the
manner or means by which the Services are accomplished except that Client
may provide specifications, descriptions, time schedules, and goals for
projects and exercise the right to evaluate NRE’s work product provided
under this Agreement. Employees or independent contractors of NRE
performing work under this Agreement shall not have any rights to any of
Client's employee fringe benefits, including, but not limited to, worker's
compensation benefits, and in no event is any contract of agency or
employment intended.
7. Warranties. NRE warrants
that the Services will be performed with care, skill and diligence in
accordance with the applicable professional standards currently recognized
by such profession, and shall be of high professional quality, technically
accurate and complete, and in strict accordance with the requirements of
this Agreement. NRE further warrants that it shall comply with all
applicable federal, state and local laws, ordinances, codes and
regulations in performing its Services. Client warrants that it
will provide all necessary access to Client management by NRE to the
extent required by NRE to fulfill the requirements of this
Agreement. Client further warrants that all information that
Client provides to NRE about the Client and the Client’s historical and
projected business shall be accurate to the best of the Client’s knowledge
(except as may be otherwise noted by Client).
8. Intellectual Property.
Except as otherwise provided herein, NRE shall immediately call to the
attention of Client, and shall, on demand at any time during or after the
term of this Agreement, absolutely and without reservation, assign,
transfer and set over to Client all right, title and interest of NRE in
and to any final work product or process which may directly or indirectly
be utilized in connection herewith, which NRE may discover, make, invent,
conceive, develop or design, solely or jointly with others, during
performance of this Agreement, or which was directly or indirectly
discovered, made, invented, conceived, developed or designed on the basis
of an idea or ideas of NRE, conceived, developed or designed on Client's
time or at the expense of Client. NRE covenants and agrees to sign any
papers and do all rightful acts or things necessary or appropriate to
secure for Client, or its successors or assigns, any and all rights, title
and interest relating to such product, improvement or process, including
patents and copyrights in the United States and foreign countries. Except
as otherwise provided herein, NRE agrees that any work performed hereunder
shall be considered a "Work for Hire," and that for purposes of Title 17,
U.S. Code, Section 201(b), Client owns all rights comprised in any
copyright obtained by NRE that is directly related to the Services
performed hereunder during the specified Term of this
agreement.
9. Confidentiality.
9.1
Proprietary information (herein called "Proprietary Information") shall,
for purposes of this Agreement, be deemed to be all such information,
material and data which NRE or its employees, agents or representatives
knows or reasonably should know is customarily treated as such within the
industry of Client, and solely by way of illustration and not in
limitation shall include the following: customer or client lists, business
methodologies and operations, drawings, designs, concepts, architecture
and circuitry, specifications, software programs, routines, subroutines,
concepts, ideas and formulas, production plans, designs, layouts,
schedules, drawings, sales, cost and price analyses, evaluations,
formulae, lists and marketing analyses, plans and data. Any Proprietary
Information concerning Client which is disclosed to or obtained by the NRE
incident to the performance of this Agreement shall remain the property of
Client and is disclosed or obtained in strict confidence. NRE shall not
use (other than in the performance of Services for Client) or disclose to
others during or subsequent to the performance of this Agreement the
Proprietary Information, unless in each instance NRE secures the prior
written consent of Client. NRE shall take every such action with its
employees and agents to effectuate the intent of this provision and the
confidentiality obligation imposed by this Agreement.
9.2 In
addition to any other rights or remedies available, both parties shall be
entitled to enforcement of the obligations in this Section 9 by court
injunction. Both parties shall disclose information learned in the course
of work performed pursuant to this Agreement only to such of its employees
or independent contractors, if any, who have a need to know and to obtain
access thereto for the purposes described in this Agreement and who are
bound by a written agreement to maintain the confidentiality of any such
information learned in the course of work performed pursuant to a Work
Order in a manner consistent with this Agreement.
10.
Indemnification.
In addition to the indemnification of third party Intellectual Property
claims which are addressed in Section
8 of this Agreement, NRE shall defend, indemnify and hold harmless
Client, its officers, directors, partners, employees, agents or other
representatives from any claims, liabilities, losses, damages, costs,
expenses (including, without limitation, attorney's fees), arising out of
or resulting from any act or omission of NRE, its employees, agents or
subcontractors in connection with this Agreement or any engagement letter
between Client and NRE.
11. Arbitration. Any
dispute, disagreement, claim or controversy between the parties arising
out of or relating to this Agreement which cannot be settled by mutual
agreement shall be resolved by binding arbitration, according to the
Commercial Arbitration Rules of the American Arbitration Association,
before a panel of three arbitrators. One of the arbitrators will be
selected by each party, and the third arbitrator will be selected by the
two party-appointed arbitrators. Any such arbitration will be held in the
New York metropolitan area. The parties will share the costs of the
arbitration equally subject to final apportionment by the arbitrators. The
arbitrators will apply the law of the State of New York to govern the
interpretation of this Agreement. The decision of the arbitrators will be
final and conclusive on Client and NRE. Judgment upon an award rendered by
the arbitrators may be entered in any court of competent
jurisdiction.
12. Miscellaneous.
12.1
All prior or contemporaneous agreements, contracts, proposals, promises,
and representations, if any, between the parties or their representatives
with respect to the subject matter hereof are superseded by, and merged
into, this Agreement, and this Agreement constitutes the entire
understanding between the parties with respect to the subject matter of
this Agreement.
12.2
No waiver or modification of the terms hereof shall be valid unless in
writing signed by the party to be charged and then only to the extent
therein set forth. This Agreement may only be amended or modified by a
written agreement or instrument signed by the parties hereto. Neither the
course of dealings between the parties nor trade usage shall act to modify
the terms of this Agreement. No waiver of any breach of this
Agreement and no course of dealing between the parties will be construed
as a waiver of any subsequent breach of this Agreement.
12.3
If any material provision of this Agreement is determined by any court of
competent jurisdiction or caused by Federal or state action to be wholly
or partially unenforceable, for any reason, this Agreement shall
terminate, notwithstanding any other provisions of this
Agreement. If a non-material provisions of this Agreement is
determined by any court of competent jurisdiction or caused by Federal or
state action to be wholly or partially unenforceable, for any reason, such
unenforceability shall not affect the balance hereof; provided further
that in lieu of such invalid or unenforceable provision, there
shall be added automatically as a part of this Agreement a provision as
similar in terms to such illegal, invalid or unenforceable provision as
may be possible and be legal, valid and enforceable.
12.4
This Agreement shall not be assignable by either party without the prior
written consent of the other party. This Agreement shall be binding upon
the parties hereto, together with their respective representatives, heirs,
successors and permitted assigns.
12.5
Except for any announcement intended solely for internal distribution or
any disclosure required by legal, accounting or regulatory requirements
beyond the reasonable control of the parties, all media releases, public
announcements or public disclosure for general distribution (including,
but not limited to, promotional or marketing material) by either party or
by their employees or agents, relating to this Agreement or its subject
matter, other than general statements that a contractual relationship
exists between the parties, will be coordinated with and approved in
writing by the other party prior to its release.
12.6
This Agreement shall be construed, interpreted, and enforced in accordance
with the laws of the State of New York.
IN WITNESS WHEREOF, the
parties have caused this Agreement to be executed by their duly authorized
representatives who personally warrant their authority to so act as of the
date first above written.
Client:
By: ____/s/ Xxxxxxx Redpath_________________
Xxxxxxx
Xxxxxxx, Chief Executive Officer
Date: ___September 11,
2008__________________
NRE:
By:
____/s/ Xxxxx
Weild_______________________
Xxxxx
Xxxxx XX
Date:
___September 10,
2008____________________
|
