MANAGEMENT SERVICES AGREEMENT
THIS MANGEMENT SERVICES AGREEMENT (this "Agreement") is made as of July 1,
2005 (the "Effective Date"), between 110 Media Group, Inc., a Delaware
corporation with its principal address at 00 Xxxxxxxxxxx Xxxx, Xxxxxxxx, Xxx
Xxxx 00000 (the "Company" or "OTEN") and Personal Portals Online, LLC, a Florida
Corporation with its principal business address at 000 Xxxx Xxxxxxx Xxxxxx Xxxxx
#000 Xxxxxxx, Xxxxxxx 00000 (the "Manager", "PPO", or the "Consultant").
Background
The Company is a publicly traded company with its securities listed on the
National Association of Securities Dealers Over The Counter Bulletin Board
(OTCBB), having a trading symbol OTEN, through one or more of its subsidiaries,
is engaged in the business of developing and managing for operation an Internet
web hosting and advertising business which maintains and hosts websites and
provides site monitoring and maintenance services for third parties and directs
and redirects Internet traffic and e-commerce opportunities to various online
and Internet based businesses and sells advertising and Internet traffic and
maintains the hardware and appurtenant fixtures, etc. needed to conduct the
business (the "Business" or the "Web1000 Business"). The Manager, through its
principal officers, shareholders, and/or independent contractors and consultants
(collectively, the "Consultants") provides Internet business management,
hosting, and website maintenance, development and business management services
for Internet technology and e-commerce and technology based companies.
The Company and the Manager wish to have the Manager manage the business,
financial and legal operations of the subsidiary (ies) which conduct the
Business set forth above, on the terms and conditions set forth in this
Agreement.
Accordingly, the parties intending to be legally bound, agree as follows:
1. Appointment. The Company hereby engages the Manager to provide the
management and consulting services as described in Section 2 below (the
"Services") during the Term (defined in Section 3.1 below) on behalf of
the Company, and the Manager accepts the engagement.
2. Services. During the Term, the Consultant will have primary responsibility
for the management, re-design and re-development of the Business primarily
in the areas of operations and technology (infrastructure and business
platforms), finance and accounting therefore, including but not limited
to:
a) Providing various day-to-day administrative and operating
tasks related to the OTEN Web1000 Business (as may be more
fully set forth on the annexed schedule);
b) Assisting in the implementation of the business strategies and
plan of the Web1000 Business;
c) Assisting the Company's management with regard to reviewing
legal and financial matters relating to the Business;
d) Providing leads for potential clients with respect to the
Web1000 Business;
e) Negotiating agreements for the Business in the ordinary
course;
f) Identifying appropriate new management, advisors and Board of
Director members as necessary to implement the Business;
g) Overseeing the Company's relationships with its outside
professionals, vendors and customers as they pertain to the
Business; and
h) Providing such other related Management and Consulting
services as requested by the Company and mutually agreeable to
the Consultant.
2.2. Staffing. The Manager will maintain in its employ, or otherwise have
available to it personnel sufficient in number and adequate in
ability to perform the Services in accordance with this Agreement.
The Manager shall make available on an "as needed" basis such
persons to have those responsibilities and perform those services
and responsibilities of a Chief Technology Officer of the Company
and an Information Technology department for the term of this
Agreement. The Consultant will have exclusive right to direct and
control its personnel and/or third parties providing the Services
other than in respect of the Company's right as the recipient of the
Services, to supervise the performance of the Manager and its
personnel under this agreement.
2.3. Non-Exclusivity. The Company expressly understands and agrees that
the relationship with the Consultant is on a non-exclusive basis and
that the Manager and its shareholders, officers, employees, and
agents shall not be prevented, barred or limited from rendering
management services of the same nature or of a similar nature to
those described in this Agreement, for or on behalf of any person,
firm, corporation, or entity other than the Company during the Term.
Nothing contained in this Agreement shall limit nor restrict the
right of the Consultant and its members, officers, employees, and
agents from engaging in the normal business of PPO; provided,
however, that any such business activity is not directly competitive
with the Company's Business, nor provides a means whereby others may
compete with the Business of the Company, and provided further that
the intellectual property, business assets, trade secrets,
proprietary business applications, and technologies of Web1000,
whether specifically identified herein, or discovered and developed
in the course and term of the Manager's engagement by the Company,
may not be used by the Manager or conveyed to any third party by the
Manager or any of its agents, employees, consultants, etc., except
for the benefit of the Company, without the prior written consent of
the Company and without appropriate remuneration therefore to the
Company.
2.4. Place of Performance. In connection with the Services performed by
the Consultant, the Consultant's activities shall be principally
based in the Consultant's Orlando office, New York, New Jersey and
remote locations, except for required travel on the Company's
behalf.
2.5. Contracts. Subject to the right of the Company to supervise the
Manager, and the limitations set forth in Sections 3 and 6, the
Manager will have the right and authority, to negotiate, enter into
and amend contracts, or take any other action on behalf of the
Company in the ordinary course of its business, acting solely as its
agent. The Manager, through the Consultants, will be authorized to
take all action including the execution and delivery of documents,
instruments, agreements, consents or certificates, as they deem
necessary or advisable in carrying out the purposes and intent of
the Agreement as conclusively evidenced by the taking of such
actions. Notwithstanding the foregoing, except with the written
consent of the CEO, the Manager shall not enter into contracts on
behalf of the Company relating to the Business, that (i) obligate
the Company, or have a total transaction value, in excess of $
10,000.00, or (ii) obligate the Company to purchase, license or
lease goods, services or tangible or intangible property that extend
beyond three months following the expiration of the scheduled Term,
except for contracts that may be cancelled at the option of the
Company without penalty, on notice of 30 days or less.
3. Matters Reserved to the Company. Unless otherwise agreed, the following
matters are outside of the Manager's authority, and are the responsibility
of the Company: (a) hiring, firing and compensating employees, consultants
and third-parties of the Company; (b) negotiating, entering into or
amending leases or long-term liabilities for the Company; (c) issuing
equity or debt in the Company; (d) preparing tax returns for the Company;
(e) committing the Company to capital expenditures not in the budget; and
(f) approving the budget.
4. Term and Termination
4.1. Term. Unless terminated earlier under Section 4.2 below, the term of
this Agreement will initially be for twenty (24) months, beginning
on the Effective Date. This initial term will automatically renew
for additional successive one (1) year terms (the initial twenty
four month term of this Agreement and all such renewal terms
collectively the "Term"), unless at least thirty (30) days prior to
the end of the then-current portion of the Term either party
provides written notice to the other party that it does not intend
to renew. During the Term, the Company agrees that it shall appoint
Xxxxxxx Xxxxxx (or his designee) as the Chief Operating officer of
the Web1000 subsidiary and he (or such designee) shall be charged
with all the duties and decision making responsibilities of the
President of such subsidiary.
4.2. Termination.
a) This Agreement may be terminated prior to the expiration of
the Term by (i) either party if a material breach to this
Agreement by the other party is not effectively cured within
30 days (the "Cure Period") from receipt of written notice of
the breach from the non-breaching party, or (ii) upon mutual
written agreement.
b) The date of termination (the "Termination Date") shall be
defined to mean; (i) in regard to Section 4.2(a)(i), the date
upon which the Cure Period expires and there has been no cure
and (ii) in regard to Section 4.1, the last day of the Term.
4.3. Effect of Termination
a) Termination under Section 4.2 will not affect any other remedy
or damages available to either of the parties. Upon
termination of this Agreement, no party will have any further
obligation to fulfill commitments under this Agreement, except
for those obligations set forth in this Section 4 and in
Sections 6 and 7 each of which expressly survive the
termination of this Agreement.
b) At the termination of this Agreement for any reason, the
Company shall pay to the Consultant any earned but unpaid
Consulting Fees (defined hereafter) up through the appropriate
Termination Date, and any unreimbursed expenses incurred by
the Consultant up through the appropriate Termination Date. In
addition, if this Agreement is terminated by the Consultant
due to a material breach by the Company pursuant to Section
4.2(a)(i) above, the Company shall pay to the Consultant on
the Termination Date, an amount equal to the Consulting Fees
which would have been paid to the Consultant for the period
commencing on the Termination Date and ending on the last day
of the Term.
5. Compensation.
5.1. Equity Compensation. The Company shall immediately issue three
million (3,000,000) shares of its $.001 par value common stock to
PPO as its initial fee for entering into this agreement. Such shares
shall be issued with the appropriate restrictive legend indicating
that they have not been registered pursuant to the Securities Act of
1933 and are therefore not freely tradable.
5.2. Monthly Fee. During the Term, as compensation for the provision of
the Services described in Section 2 hereof, the Consultant shall be
paid a fee of Five Percent (5%) of the net monthly revenues of the
Business, to be paid on a per month basis (the "Consulting Fee"),
payable in equal installments in advance on the first business day
of each month for Services to be provided for that month.
5.3. Expenses. The Consultant shall be promptly reimbursed for all
reasonable and approved out-of-pocket expenses incurred by it in
performing the Services under this Agreement, provided that the
Consultant submits reasonable documentation supporting such
evidence.
6. Representations and Warranties. Each party represents and warrants to the
other party that:
a) It is a corporation or limited liability company duly
incorporated or formed, validly existing and in good standing
under the laws of the jurisdiction in which it was formed, and
has all corporate or membership powers required to carry on
its business as now conducted.
b) This Agreement will be duly executed and delivered by it and,
assuming the due execution by the other parties to this
Agreement, constitutes a valid and binding agreement,
enforceable against it in accordance with its terms, except as
enforcement is limited by bankruptcy, insolvency and other
similar laws affecting the enforcement of creditors' rights
generally and except for limitations imposed by general
principles or equity.
c) The execution, delivery and performance of this Agreement (i)
are within its powers and have been duly authorized by all
necessary action; and (ii) do not (A) violate its
organizational documents, (B) violate any applicable provision
of any law, regulation, rule, judgment, injunction, order or
decree binding upon or applicable to it, or (C) require notice
or constitute default under any provision of any agreement,
contract or other instrument binding upon it or any license,
franchise, permit or other similar authorization held by it.
d) To its knowledge no consent, license, approval, order,
authorization of, or registration, filing with or declaration
of any governmental body, agency, official or authority is
required to be obtained or made by it. No material consent,
license approval or authorization of any third party is
required to be obtained by it in connection with its
execution, delivery and performance of this Agreement.
e) It is not engaged in, a party to or subject to, or to its
knowledge threatened with any claim, controversy, legal or
equitable action or other proceeding (whether as plaintiff,
defendant or otherwise), the outcome of which, if adversely
determined, would reasonably be likely to have a material
adverse effect, or could materially adversely impair its
ability to fully perform its obligations under this Agreement.
There are no federal, state or local tax obligations
outstanding the effect of which would materially adversely
impair either party's business and operations.
7. Indemnification.
7.1. Indemnification by the Company. The Company will indemnify and save
harmless the Manager/ Consultant and each of its respective
directors, officers, stockholders, employees and agents
(collectively, the "Consultant Indemnitees") from and against any
and all claims, liabilities, damages, losses, costs and expenses
(including amounts paid in satisfaction of judgments in compromises
and settlements, as fines and penalties and legal or other costs and
expenses of investigating or defending against any claims or alleged
claims) of any nature whatsoever, liquidated or unliquidated, that
are incurred by any Consultant Indemnitees and arise out of or in
connection with the performance of any of the Consultant
Indemnities' obligations under this Agreement unless the claim or
alleged claim resulted from the willful misconduct, negligence or
fraud of the Consultant Indemnitees. The Company agrees that,
without the Consultant Indemnitees prior written consent, it will
not settle, compromise or consent to the entry of any judgment in
any pending or threatened claim, action or proceeding in respect of
which indemnification could be sought under this Section 7 (whether
or not the Consultant Indemnitees are actual or potential parties to
such claim, action or proceeding), unless such settlement,
compromise or consent includes an unconditional release of each
Consultant Indemnitees from all liability arising out of such claim,
action or proceeding. The Company on its own behalf waives all right
to trial by jury in any action, proceeding or counterclaim (whether
based upon contract, tort or otherwise) related to or arising out of
the engagement of the Consultant pursuant to, or the performance by
the Consultant of the Services contemplated by this Agreement.
7.2. Indemnification by the Manager/ Consultant. The Manager will
indemnify and save harmless the Company and each of its respective
directors, officers, stockholders, employees and agents
(collectively, the "Company Indemnitees") from and against any and
all claims, liabilities, damages, losses, costs and expenses
(including amounts paid in satisfaction of judgments in compromises
and settlements, as fines and penalties and legal or other costs and
expenses of investigating or defending against any claims or alleged
claims) of any nature whatsoever, liquidated or unliquidated, that
are incurred by any Company Indemnitees and arise out of or in
connection with any claim or alleged claim resulting from the
willful misconduct, negligence or fraud of the Consultant,
Consultants or the Company Indemnitees. The Consultant agrees that,
without the Company Indemnitees prior written consent, it will not
settle, compromise or consent to the entry of any judgment in any
pending or threatened claim, action or proceeding in respect of
which indemnification could be sought under this Section 7 (whether
or not the Company Indemnitees are actual or potential parties to
such claim, action or proceeding), unless such settlement,
compromise or consent includes an unconditional release of each
Company Indemnitee from all liability arising out of such claim,
action or proceeding. The Consultant, in its own behalf waives all
right to trial by jury in any action, proceeding or counterclaim
(whether based upon contract, tort or otherwise) related to or
arising out of the engagement of the Consultant pursuant to, or the
performance by the Consultant of the Services contemplated by this
Agreement.
The Parties acknowledge that this represents the entirety of their Agreement and
no other or further obligations than those specified herein shall arise, except
as may otherwise be agreed to by the parties in writing.
BALANCE OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE TO CONSULTING AGREEMENT BETWEEN 110 MEDIA GROUP, INC. & PERSONAL
PORTALS ONLINE, INC. Dated JULY 1, 2005
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first above written.
110 MEDIA GROUP, INC.
By: /s/ Xxxxxxx Xxxxxx
----------------------------
Name: Xxxxxxx Xxxxxx
Title: CEO
PERSONAL PORTALS ONLINE, INC.
By: /s/ Xxxxxxx Xxxxxx
----------------------------
Name: Xxxxxxx Xxxxxx
Title: CEO
Detailed Schedule of Services
Rebuild Web Hosting platform with both free and paid accounts
registration/management
Create Affiliate program for free sites
Create credit card/online processing DLL's to match gateway provider(s) with
affiliate auto payout system
Advertising management/placement system
Rebuild database completely
Complete Installation of above mentioned software
Secure data from current servers onto new network
Reconstruction/ marketing efforts to reach back out to the old Web1000 clients,
Obtain and develop strong presence in Search Engine Optimization with Google,
Yahoo, MSN and AOL.
