Quantum Resources of NY, Inc.
00 Xxx Xxxx Xxxxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
Voice: 000-000-0000
Fax: 000-000-0000
E-mail xxxx0@xxx.xxx
February 1, 1998
Xx. Xxxx Xxxx
WideCom Inc.
00 Xxxxx Xx, Xxxx 00
Xxxxxxxx, Xxxxxxx Xxxxxx X00 0X0
Dear Xx. Xxxx Xxxx,
This Agreement, when executed by the parties hereto, will constitute an
agreement between WideCom, Inc. (the "Company") and Quantum Resources of NY,
Inc. ("Quantum") pursuant to which the Company agrees to retain Quantum and
Quantum agrees to be retained by the Company under the terms and conditions
set forth below.
1) The Company hereby retains Quantum to perform consulting services
related to the business structure and communications of the company.
In this regard, subject to the terms set forth below, Quantum shall
furnish to the Company advice and recommendations with respect to such
aspects of the business communication, sales and marketing affairs of
the Company as the Company shall, from time to time, reasonably
request upon reasonable notice. In addition, Quantum shall hold itself
ready to assist the Company in evaluating and negotiating particular
contacts with personnel the Company wishes to employ, if requested to
do so by the Company, upon reasonable notice.
2) As compensation for the services outlined in paragraph one above and
as an inducement to enter into this agreement, the Company agrees to
pay to Quantum a consulting fee of $5,000 a month beginning February
1, 1999, payable monthly in advance. In addition, the Company shall
issue to Quantum a five year warrant to purchase 37,500 shares of
common stock at $ 1.20 a share, post split for its prior advisory work
and for its role in the recruiting and hiring of an Sales Executive
Vice President. The warrant shall be in the form acceptable to
Quantum, shall include piggyback registration rights, and shall have a
provision for cash-less execution.
3) The company and Quantum acknowledge and agree that Quantum will act as
a finder or financial consultant in various business transactions in
which the Company may be involved, such as mergers, acquisitions or
joint ventures. The Company hereby agrees that in the event Quantum
shall first introduce to the Company another party or entity, and that
as a result of such introduction, a transaction ("Transaction") is
consummated, the Company shall pay to Quantum a fee equal to:
5% of the first two million dollars
4% of the second two million dollars
3% of the third two million dollars
2% of the fourth two million dollars
1% of the balance of the consideration (the "Consideration") received and/or
paid in such Transaction. Such fee shall be paid in cash unless the seller
in the contemplated transaction receives securities, in which case the fee
shall be paid in cash and securities in the same percentage of cash and
securities and at the same time as the consideration is paid to the seller.
In addition, if the Company shall, within 12 months immediately following
the termination of this Agreement, consummate a transaction with any party
first introduced by Quantum to the Company prior to such termination, the
Company shall pay to Quantum a fee with respect to such transaction
calculated in accordance with this paragraph.
4) For purposes hereof, "Consideration" shall mean the value of all cash,
securities and other property or other assets paid, received, payable
or receivable, including debt assumed, in connection with a
Transaction, including, without limitation: (a) any distributions made
to shareholders in anticipation of the closing; (b) any employment
contract enhancements or non competition payments (other than ordinary
and customary compensation in connection with bona fide employment
agreements); (c) any payments in connection with any separate
transactions affecting another business entity or any of its assets or
securities (e.g., purchase or lease of any real estate or other
assets, but in the case of a lease, Consideration shall include only
sums in excess of current rentals paid to unrelated or unaffiliated
third parties); (d) any indebtedness for money borrowed, including
receivables, pension liabilities and guarantees, which are assumed;
and (e) other business considerations (e.g. business discounts and/or
credits for services and/or products). For purposes of determining
Consideration, the value of any securities (whether debt or equity)
shall be deemed to be the greater of: (i) the fair market value
thereof as of the day the definitive agreement is executed by all
parties; or (ii) the average of the last reported sales prices of the
securities on the twenty (20) consecutive business days prior to the
consummation of the Strategic Transaction as reported on the principal
exchange on which the security is listed, or, as the case may be, the
NASDAQ National Market System; provided that the value of securities
that are not freely tradable or have no established public market
shall be the fair market value thereof as reasonably agreed upon by
the parties hereto. If any part of the Consideration shall be deferred
or contingent upon future earnings or other contingencies, then
Quantum shall be entitled to a Transaction Fee on such additional
Consideration, and the term Consideration shall include such
additional compensation which shall be payable on the basis of the
payment when made by the payor. The Transaction Fee for such
Consideration paid or received in the future shall be payable when
such Consideration is paid and shall be calculated using the formula
set forth above by adding this subsequent Consideration to all other
Consideration previously paid.
5) All obligations of Quantum contained herein shall be subject to
reasonable notice. Quantum shall devote such time and effort to the
performance of its duties hereunder as Quantum shall determine is
reasonably necessary for such performance. Quantum may look to such
others for such factual information, investment recommendations,
economic advice and/or research, upon which to base its advice to the
Company hereunder, as it shall deem appropriate. The Company shall
furnish to Quantum all information reasonably relevant to the
performance by Quantum of its obligations under this Agreement, or
particular projects as to which Quantum is acting as advisor, which
will permit Quantum to know all facts material to the advice to be
rendered, and all material or information reasonably requested by
Quantum, In the event that the Company fails or refuses to furnish any
such material or information reasonably requested by Quantum, and thus
prevents or impedes Quantum's performance hereunder, any inability of
Quantum to perform shall not be a breach of its obligations
hereunder, Nothing contained in this Agreement shall limit or
restrict the right of Quantum or of any partner, employee, agent or
representatives of Quantum, to be a partner, director, officer,
employee, agent or representative of, or to engage in, any other
business, whether of a similar nature or not, nor to limit or restrict
the right of Quantum to render services of any kind to any other
corporation, firm, individual or association.
6) Quantum shall hold in confidence any confidential information, which
the Company provided to Quantum pursuant to this Agreement unless the
Company gives Quantum permission to in writing to disclose such
confidential information to a specific third party. Notwithstanding
the foregoing, Quantum shall not be required to maintain
confidentiality with the respect to information (i) which is or
becomes part of the public domain; (ii) of which it had independent
knowledge prior to disclosure; (iii) which comes into the possession
of Quantum in the normal routine course of its own business from and
through independent non-confidential sources; or (iv) which is
required to be disclosed by Quantum by governmental requirements. If
Quantum is requested or required (by oral questions, interrogatories,
requests for information or document subpoenas, civil investigative
demands, or similar process) to disclose any confidential information
supplied to it by the Company, or the existence of other negotiations
in the course of its dealings with the Company or its representatives,
Quantum shall, unless prohibited by law, promptly notify the Company
of such request(s) so that the Company may seek an appropriate
protective order.
7) Each party agrees to indemnity and hold harmless the other, their
employees, agents, representatives and controlling persons (and the
officers, directors, employees, agents, representatives and
controlling persons of each of them) from and against any and all
losses, claims, damages, liabilities, cost and expenses (and all
actions, suits, proceeding or claims in respect thereof) and any legal
or other expenses in giving testimony or furnishing documents in
response to a subpoena or otherwise, as and when incurred, directly or
indirectly, caused by, relating to, based upon or arising out of the
services pursuant to this Agreement. The Company further agree that
Quantum shall incur no liability to the Company or any other party on
account of this Agreement or any acts or omissions arising out of or
related to the actions of Quantum relating to this Agreement or the
performance or failure to perform any services under this Agreement
except for Quantum's intentional or willful misconduct. This paragraph
shall survive the termination of this Agreement.
8) This Agreement may not be transferred, assigned or delegated by any of
the parties hereto without the prior written consent of the other
party hereto.
9) The failure or neglect of the parties hereto to insist in any one or
more instances, upon the strict performance of any of the terms and
conditions of this Agreement, or their waiver of strict performance of
any of the terms and conditions of this agreement, shall be construed
as a waiver of strict performance of any of the terms or conditions of
this Agreement, shall not be construed as a waiver or relinquishment
in the future of such term and condition, but the same shall continue
in full force and effect.
10) The term of this Agreement is for 12 months. Either party may
terminate the agreement after Quantum has received three months of
consecutive payments and by giving 30 days written notice.
11) Any notices hereunder shall be sent to the Company and Quantum at
their respective addresses set forth above. Any notice shall be given
by registered or certified mail, postage prepaid, and shall be deemed
to have been given when deposited in the United States mail. Either
party may designate any other address to which notice shall be given,
by giving written notice to the other of such change of address in the
matter herein provided.
12) This Agreement has been made in the State of New York and shall be
construed and governed in accordance with the laws thereof without
giving effect to principles governing conflicts of law.
13) This Agreement contains the entire agreement between the parties, may
not be altered or modified, except in writing, signed by the party to
be changed thereby, and supersedes any and all previous agreements
between the parties relating to the subject or matter hereof.
WideCom Corporation Quantum Resources of NY, Inc.
By: By:
___________________________________ ____________________________________
Xxxx Xxxx, President Xxxxxxx X. Xxxxxxxx, President
