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EXHIBIT 10.1
Consulting Agreement
LBC Capital Corporation
0000 Xxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxxxx, XX 00000
TEL: 000-000-0000
FAX: 000-000-0000
June 15, 1999
EagleTech Communications, Inc.
000 X. Xxxxxxx Xxxxxx
Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxx
Chief Executive Officer
This letter confirms the agreement ("Agreement") by EagleTech
Communications, Inc., and its affiliates (collectively the "Company") to retain
LBC Capital Corporation ("LBC") to provide the services described below on a
non-exclusive basis.
1. Services. The following summarizes the services to be provided by LBC.
1.1 LBC will advice the Company about "Transactions" (as defined
below) and screen corporations, individuals, mutual funds,
hedge funds, investors, investment partnerships, securities
firms, lending and other institutions identified by LBC
(collectively "Entities") which may engage in or provide a
Transaction to the Company. As used herein, the term
"Entities" also means and includes any party, which is
directly or indirectly connected with or related to one of the
Entities described above including, without limitation, all
affiliates as well as any referral from any of the Entities,
any client or customer of any of the Entities, and any
investor in any of the Entities.
1.2 Except as set forth below, all services provided by LBC under
this Agreement shall be at LBC's cost and risk. LBC's
compensation for consulting services consists of 1) a retainer
of $15,000 per month for six (6) months (first three (3)
months payable upon the signing of this Agreement), and 2)
100,000 restricted
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common shares upon the signing of this Agreement. LBC shall
receive a "Transaction Fee" upon consummation of a Transaction
in any form which any Entities as provided in Section 4 below.
The consummation of a Transaction may or may not require the
services of LBC. At the sole discretion of the Company, LBC
shall also assist the Company with regard to the completion of
a new Business Plan. LBC will devote a minimum of 100 hours to
this activity and will be paid $20,000 payable $10,000 at the
time of the request by the Company and $10,000 upon the
satisfactory completion of the plan.
1.3 The Company affirms that LBC's activities are entirely on a
best efforts basis and that the Company perceives value, in
exchange for the consideration paid, by virtue of the
association with LBC and the possibility of resulting advice.
2. Term.
2.1 This Agreement shall take effect immediately and shall
continue in effect for a minimum term of one (1) year.
Thereafter the Agreement will remain in effect until
terminated by either party upon thirty (30) days prior written
notice to the other.
3.1 To assist LBC in performing its services, the Company will
provide LBC with such information regarding the Company and
its operations as the Company shall determine is proper and
appropriate and LBC shall be entitled to rely thereon. The
Company shall also promptly advise LBC of all communications
to or from Entities respecting potential Transactions.
4. Transaction Fee to LBC.
4.1 LBC shall receive a transaction fee ("LBC's Fee") comprised of
cash and warrants.
4.2 The cash portion of LBC's Fee shall equal eight (8%) percent
of the Transaction Amount (as defined below), and shall be
paid at the closing of each Transaction. Any portion of LBC's
Fee (cash or warrants) that is attributable to proceeds to be
received by the Company upon the occurrence of a future event,
or the satisfaction of a contingency, shall be paid when the
event occurs or the contingency is satisfied.
4.3 In addition to the cash portion of LBC's Fee as set forth
above, upon completion of one or more Transactions, for each
$1,000,000 of Transaction Amount, on a pro-rata basis, LBC or
its designee agrees to purchase, and the Company agrees to
sell for $2,500, a five (5) year warrant ("Warrant") equal to
one (1%) percent of the outstanding shares of the Company on a
fully diluted basis exercisable at one
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hundred twenty-five (125%) percent of the lower of the average
closing price of the Company's common stock for the five (5)
trading days prior to the signing of this Agreement or the
five (5) trading days prior to the completion of a
Transaction. The Warrant will contain standard provisions as
to anti-dilution, cashless exercise, registration rights,
transferability, etc. Upon the completion of any Transaction,
LBC's Warrants will not exceed two and one-half (2.5%) percent
of the Company's outstanding shares on a fully diluted basis.
4.4 LBC will not be paid for any marketing or sales arrangements
entered into by the Company unless such arrangement includes
consideration paid or lent to the Company, joint venture
arrangements, etc.
4.5 In the event of the sale of the Company, a merger or
acquisition, LBC's Transaction Fees (cash and warrants) shall
be fifty (50%) percent of those stated in this Agreement, and
such compensation will be limited to LBC Entities as defined
in Section 1.1
4.6 In the event LBC identifies a bonafide investment firm which
completes a public offering or private placement and such
investment firm receives compensation from the Company for
such placement, LBC's Transaction fees (cash and shares of
common stock) shall be reduced to fifty (50%) percent of those
stated in this Agreement, and shall be further reduced by any
and all finders' fees paid to LBC by such investment firm.
4.7 LBC's Fee shall have been earned and shall be payable to LBC
upon consummation of any Transaction which occurs as a result
of this Agreement with any Entities in which a Transaction was
made in whole or in part (1) during the term of this Agreement
(hereafter "Phase I"), or (2) within twenty-four (24) months
following the effective termination date of this Agreement
(hereafter "Phase II") with regard to Entities with which LBC
or the Company has had any communications during Phase I, or
(3) within thirty-six (36) months following the effective date
of this Agreement with any Entity with which there has been a
Transaction during Phases I or II above.
5. Indemnification.
5.1 LBC shall assume that (a) all information furnished by the
Company or its representatives, as well as all information
contained in public documents issued by or for the Company or
made available to LBC by the Company, is complete and accurate
in all material respects, and does not omit any material fact
or information necessary to make the statements contained
therein not misleading, and (b) the Company has complied with
or, prior to closing, will comply with all applicable laws
relating to the issuance of securities. The Company xxxx
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indemnify and hold harmless LBC, its affiliates, successors,
assigns, directors, officers, agents, employees and their
heirs, executors, administrators and all persons, firms and
entities who might be claimed to be jointly or severally
liable with LBC ("Indemnified Parties") against any loss or
liability arising directly or indirectly from the Company's
activities.
5.2 The Company will indemnify and hold harmless the Indemnified
Parties from and against any and all losses, claims, damages,
liabilities, cost and expenses (including any legal fees and
costs incurred in connection with such claim) to which such
indemnified parties may become subject under any applicable
federal or state law or otherwise, except to the extent that
any such loss, claim, damage or liability, cost and expense is
finally judicially determined to have resulted from LBC's
negligence or misconduct in the performance of its services
hereunder.
5.3 If the Company fails to fulfill its obligations under this
Agreement, the Company will be responsible for resulting
damages, losses, and expenses, including legal expenses, if
any.
6. Transaction and Transaction Amount.
6.1 As used herein, the term "Transaction" means any business
agreement, arrangement, or transaction or series or
combinations thereof which may include sales or exchanges of
stock, warrants, or assets, or the making of loans, leases and
other arrangements of every type and description by which,
directly or indirectly, an interest in the Company, its
affiliates, or any business with common management with the
Company, or any of their respective assets, capital stock or
other securities, may be transferred including, without
limitation, a merger, acquisition, sale or exchange or stock
or assets, lease of assets, with or without purchase option,
joint venture, royalty or licensing arrangements, minority
investment or partnership.
6.2 As used herein, the term "Transaction Amount" shall mean the
gross amount of consideration exchanged or provided to or by
the Company or its shareholders, affiliates, or subsidiaries
in a Transaction, or any entities formed in or which results
from a Transaction. The Transaction Amount shall be cumulative
(e.g., if the Company receives initial consideration and then
subsequently received royalty and/or licensing fees, option or
warrant exercise funds, (however, whenever exercised or
converted into another Company's warrants or shares) etc.)
such that the Transaction Amount shall include all such
consideration.
7. General Provisions.
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7.1 For the purposes of this Agreement, the term "Company"
includes any entity which acquired (by merger or otherwise)
any or substantially all of the assets and/or rights of the
Company, and the successors, newly formed entities or assigns
of the Company.
7.2 The headings on the various paragraphs of this Agreement are
solely intended to simplify the reading of this Agreement and
are not meant to impart any meaning to the Agreement.
7.3 LBC will not be responsible for any fees, commissions or
expenses payable to any other person, firm, or Entity.
7.4 This Agreement may not be amended or modified except in
writing and shall be governed by and construed in accordance
with the laws of the Commonwealth of Pennsylvania.
8. Expenses.
8.1 Concurrent with the execution of this Agreement, the Company
will issue to LBC a non-accountable expense allowance equal to
$10,000. In addition, the Company will reimburse all
reasonable LBC expenses incurred on behalf of the Company not
to exceed $25,000 without prior written authorization of the
Company.
9. Acceptance and Effectiveness.
9.1 Nothing herein shall obligate the Company to enter into any
Transaction proposed by LBC.
9.2 Execution of this letter by the Company, and return of a
signed copy, by fax or otherwise to LBC completes this
Agreement between LBC and the Company.
If the foregoing is acceptable to you, please sign and return the
enclosed copy of this letter to my attention.
Very truly yours,
LBC Capital Corporation
By: /s/Xxxxx Xxxxxxx
Xxxxx Xxxxxxx
President
ACCEPTED:
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Eagletech Communications, Inc.
By: /s/ Xxxxxx Xxxxx Date: 6/15/99
Xxxxxx Xxxxx
Eagletech Communications, Inc.
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