EXHIBIT 10.12
Magnitude Information Systems, Inc.
000 Xxxxx Xxxxx 00, Xxxxxxx, Xxx Xxxxxx 00000
December 1, 2003
Xx. Xxxx X. Xxxxx 000 Xxxxxxx Xxxx Xx.
Xxx #0000
Xxxxxx, XX 00000
Dear Xx. Xxxxx:
This letter shall serve as an engagement agreement, subject to approval of the
Board of Directors of Magnitude Information Systems, Inc., pursuant to which
Magnitude Information Systems, Inc. (the '"Company") engages you ("Consultant"
or "you") to act on a non-exclusive basis, to render specified senior consulting
and sales representation services.
1. ENGAGEMENT: The Company hereby engages you, and you agree to devote your best
efforts to, perform the following services:
(a) to assist the Company in identifying opportunities for the sale and
licensing of the Company's software products;
(b) to act on a non-exclusive basis as a general business consultant, including,
but not limited to identifying institutional investors as a source of financing
as well as institutional investors to invest in our stock in the public trading
market place.
2. TERM: Your engagement hereunder shall commence on the date first above
written and shall continue through the next twelve months (the "Term").
3. COMPENSATION: In consideration for his services hereunder, Consultant shall
receive the following compensation:
(a) For sales and/or licensing of our software products to clients (the
"Approved Prospects") that had been referred to us by you and - subject to
individual approval by us - are included in a periodically updated "Prospect
List", where such sales or licensing is consummated during the Term or any
renewal thereof or within twelve months after termination of this Agreement, a
cash commission of five percent (5%) on the gross proceeds to the Company from
such transaction less freight charges, taxes, returns or allowances, payable
within 30 days after receipt by the Company of such proceeds.
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(b) For his efforts with respect to his services under 1 (b) above Consultant
shall be entitled to a flat fee remuneration of 45,000 restricted shares of the
common stock of Magnitude Information Systems, Inc., such shares to carry
piggy-back registration rights.
4. ASSIGNMENT: Consultant may assign any of his rights to compensation earned
under this Agreement provided he advises the Company in writing of such
assignment and furthermore provided that any such assignees have the right to
receive such compensation in accordance with ail applicable disclosure laws and
rules, and subject to all disclosure regulations requiring the disclosure of
such assignees' interest in any proposed transaction.
5. CONSULTANT REPRESENTATIONS: Consultant agrees and represents: (a) that he is
an independent contractor and not an employee of the Company, that in acting
pursuant to this engagement he will not legally bind or obligate the Company in
any manner whatsoever; (b) that the execution and delivery of and his
performance under, this Agreement shall not violate or breech any agreement,
contract or obligation currently in existence between the Consultant and any
third party, and; (c) Consultant hereby acknowledges that he is not a registered
broker dealer with the National Association of Securities Dealers, Inc. ("NASD")
nor registered with any state securities commission as a broker dealer and that
when performing his duties under this Agreement in connection with any equity
financing identified in Section 3(c) above, Consultant's role and duties shall
be strictly limited to providing introductions of potential equity investment
sources to the Company and shall not engage in any negotiations, discussions or
sales effort with respect thereto, all of which activities shall be undertaken
by the authorized officers of the Company.
6. CONFIDENTIALITY AND NON-COMPETE: Except as contemplated by the terms hereof
or as required by applicable law, you shall keep confidential during the Term
and for a period of twelve months thereafter all non-public information provided
to you by the Company, and shall not disclose such information to any third
party, other than such of your partners, employees and advisors as you determine
to have a need to know and shall not use any such information for any purpose
other than the purpose of performing your services for the Company as herein
contemplated. In addition, Consultant hereby agrees not to compete, either
directly or indirectly as a shareholder of another company, with the Company in
the field of Ergonomic Productivity Software or solicit any of the Company's
employees to leave the Company during the Term and for a period of twelve months
thereafter.
7. SHORT POSITION: During the term of this engagement and for a period of twelve
months thereafter, Consultant will not maintain a net short position at any time
in the Company's shares. This net position includes freely trading shares and
any preferred shares and warrants on an "as converted" basis.
8. ASSISTANTS TO CONSULTANT: Should the Consultant, in Consultant's sole
discretion, deem it necessary to engage assistants, or third parties, to aid
Consultant in the performance of the Services, the parties agree that such
assistants are engaged solely by the Consultant, and that Consultant alone is
responsible for providing compensation for such assistants.
9. AGREEMENT: This Agreement may not be amended or modified except in writing
and shall be deemed to have been made and delivered in the State of New Jersey,
and this letter and the transactions contemplated hereby shall be governed as to
validity, interpretation, construction, effect, and in all other respects by the
internal laws of the State of New Jersey. Any legal action or proceeding arising
out of or relating to this Agreement and/or the transactions contemplated hereby
shall be instituted exclusively in the Superior Court. County of Xxxxxx or
County of Somerset, State of New Jersey or in the United States District Court
for the District of New Jersey, and the parties hereby expressly submit to the
jurisdiction of said courts.
10. COMPLETE AGREEMENT: This Agreement supercedes and replaces any and all prior
agreements between the parties.
If the foregoing correctly sets forth the understanding and agreements between
the Company and you. please so indicate in the space provided for that purpose
below, whereupon this letter shall constitute a binding agreement as of the date
first above written.
Magnitude-Information Systems. Inc.
By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
President and CEO
Agreed to:
CONSULTANT:
/s/ Xxxx X. Xxxxx
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