EXHIBIT 4
ADVISORY Agreement
Agreement (the "Agreement") dated as of March 19, 2004, by and among
Scores Holding Company Inc. (the "Company") and Xxxxx Xxxxxx (the "Advisor").
W I T N E S S E T H:
WHEREAS, the Company and the Advisor entered into an Agreement dated
February 27, 2004 that provided for compensation to the Advisor for the ninety
(90) days prior to the date of that Agreement; and
WHEREAS, the Company desires to compensate the Advisor for further
performance and the Advisor desires to be compensated by the Company pursuant to
the terms and conditions hereinafter set forth:
NOW, THEREFORE, in consideration of the foregoing and the
mutual promises and covenants herein contained, it is hereby agreed as follows:
SECTION 1. Retention. (a) The Company hereby retains the
Advisor on a non-exclusive basis to perform the services set forth in paragraph
(b) below during the one (1) year period following execution of this Agreement
(the "Term"), commencing on the date hereof, and applicable to the three (3)
months prior to the execution of this Agreement, and the Advisor hereby accepts
such retention and application and shall perform for the Company the duties
described herein, faithfully and to the best of its ability. During the Term,
the Advisor shall report directly to the President of the Company or such other
senior officer of the Company as shall be designated by the President of the
Company.
(b) The Advisor shall serve as a business advisor to the
Company and render such advice and services to the Company as may be reasonably
requested by the Company including, without limitation, strategic planning,
merger and acquisition possibilities and business development activities
including, without limitation, the following:
(i) study and review of the business, operations, and
historical financial performance of the Company (based upon management's
forecast of financial performance) so as to enable the Advisor to provide advice
to the Company;
(ii) assist the Company in attempting to formulate
the best strategy to meet the Company's working capital and capital resource
needs;
(iii) assist in the formulation of the terms and
structure of any reasonable proposed business combination transaction involving
the Company;
(iv) assist in the presentation to the Board of
Directors of the Company of any proposed transaction.
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SECTION 2. Compensation. (a) The Company shall pay to the
Advisor a fee of Fifty Two Thousand Dollars ($52,000.00) payable in 500,000
shares of the Company's common stock (the "Common Stock") at a price that is 65%
of the stock's closing price on the date of this Agreement ($0.104 per share
based on Closing price of $0.16), and which shares shall be registered with the
Securities & Exchange Commission on Form S-8. The fee is in consideration of
performance under this Agreement. The Company and the Advisor agree to meet from
time-to-time to discuss further compensation based on performance.
SECTION 3. Confidential Information. The Advisor agrees that
during and after the Term, it will keep in strictest confidence, and will not
disclose or make accessible to any other person without the written consent of
the Company, the Company's products, services and technology, both current and
under development, promotion and marketing programs, lists, trade secrets and
other confidential and proprietary business information of the Company or any of
its clients and third parties including, without limitation, Proprietary
Information (as defined in Section 7) (all of the foregoing is referred to
herein as the "Confidential Information"). The Advisor agrees (a) not to use any
such Confidential Information for himself or others; and (b) not to take any
such material or reproductions thereof from the Company's facilities at any time
during the Term except, in each case, as required in connection with the
Advisor's duties hereunder.
Notwithstanding the foregoing, the parties agree that the
Advisor is free to use (a) information in the public domain not as a result of a
breach of this Agreement, (b) information lawfully received form a third party
who had the right to disclose such information and (c) the Advisor's own
independent skill, knowledge, know-how and experience to whatever extent and in
whatever way he wishes, in each case consistent with his obligations as the
Advisor and that, at all times, the Advisor is free to conduct any research
relating to the Company's business.
SECTION 4. Ownership of Proprietary Information. The Advisor
agrees that all information that has been created, discovered or developed by
the Company, its subsidiaries, affiliates, licensors, licensees, successors or
assigns (collectively, the "Affiliates") (including, without limitation,
information relating to the development of the Company's business created,
discovered, developed by the Company or any of its affiliates during the Term,
and information relating to the Company's customers, suppliers, advisors, and
licensees) and/or in which property rights have been assigned or otherwise
conveyed to the Company or the Affiliates, shall be the sole property of the
Company or the Affiliates, as applicable, and the Company or the Affiliates, as
the case may be, shall be the sole owner of all patents, copyrights and other
rights in connection therewith, including without limitation the right to make
application for statutory protection. All the aforementioned information is
hereinafter called "Proprietary Information." By way of illustration, but not
limitation, Proprietary Information includes trade secrets, processes,
discoveries, structures, inventions, designs, ideas, works of authorship,
copyrightable works, trademarks, copyrights, formulas, improvements, inventions,
product concepts, techniques, marketing plans, merger and acquisition targets,
strategies, forecasts, blueprints, sketches, records, notes, devices, drawings,
customer lists, patent applications, continuation applications,
continuation-in-part applications, file wrapper continuation applications and
divisional applications and information about the Company's Affiliates, its
employees and/or advisors (including, without limitation, the compensation, job
responsibility and job performance of such employees and/or advisors).
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All original content, proprietary information, trademarks,
copyrights, patents or other intellectual property created by the Advisor that
does not include any specific information relative to the Company's proprietary
information, shall be the sole and exclusive property of the Advisor.
SECTION 5. Indemnification. The Company represents that all
materials provided or to be provided to the Advisor or any third party regarding
the Company's financial affairs or operations are and shall be truthful and
accurate and in compliance with any and all applicable federal and state
securities laws. The Company agrees to indemnify and hold harmless the Advisor
and its advisors, professionals and affiliates, the respective directors,
officers, partners, members, managers, agents and employees and each other
person, if any, controlling the Advisor or any of its affiliates to the full
extent lawful, from and against all losses, claims, damages, liabilities and
expenses incurred by them (including reasonable attorneys' fees and
disbursements) that result from actions taken or omitted to be taken (including
any untrue statements made or any statement omitted to be made) by the Company,
its agents or employees which relate to the scope of this Agreement and the
performance of the services by the Advisor contemplated hereunder. The Advisor
will jointly and severally indemnify and hold harmless the Company and the
respective directors, officers, agents, affiliates and employees of the Company
from and against all losses, claims damages, liabilities and expenses that
result from bad faith, gross negligence or unauthorized representations of the
Advisor. Each person or entity seeking indemnification hereunder shall promptly
notify the Company, or the Advisor, as applicable, of any loss, claim, damage or
expense for which the Company or the Advisor, as applicable, may become liable
pursuant to this Section 8. No party shall pay, settle or acknowledge liability
under any such claim without consent of the party liable for indemnification,
and shall permit the Company or the Advisor, as applicable, a reasonable
opportunity to cure any underlying problem or to mitigate actual or potential
damages. The scope of this indemnification between the Advisor and the Company
shall be limited to, and pertain only to certain transactions contemplated or
entered into pursuant to this Agreement.
The Company or the Advisor, as applicable, shall have the
opportunity to defend any claim for which it may be liable hereunder, provided
it notifies the party claiming the right to indemnification in writing within
fifteen (15) days of notice of the claim.
The rights stated pursuant to this Section 8 shall be in
addition to any rights that the Advisor, the Company, or any other person
entitled to indemnification may have in common law or otherwise, including, but
not limited to, any right to contribution.
SECTION 6. Notices. Any notice or other communication under
this Agreement shall be in writing and shall be deemed to have been duly given:
(a) upon facsimile transmission (with written transmission confirmation report)
at the number designated below; (b) when delivered personally against receipt
therefore; (c) one day after being sent by Federal Express or similar overnight
delivery; or (d) five (5) business days after being mailed registered or
certified mail, postage prepaid. The addresses for such communications shall be
as set forth below or to such other address as a party shall give by notice
hereunder to the other party to this Agreement.
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If to the Company: Scores Holding Company Inc.
000-000 X. 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
If to the Advisor: Xxxxx Xxxxxx
000 00xx Xxxxxx Xxxxx
#000
Xxxxxx, Xxxxxxx 00000
(000) 000-0000
SECTION 7. Status of Advisor. The Advisor shall be deemed to
be an independent contractor and, except as expressly provided or authorized in
this Agreement, shall have no authority to act for on behalf of or represent the
Company. This Agreement does not create a partnership or joint venture.
SECTION 8. Other Activities of Advisor. The Company recognizes
that the Advisor now renders and may continue to render financial consulting and
other investment banking services to other companies, which may or may not
conduct business and activities similar to those of the Company. The Advisor
shall not be required to devote its full time and attention to the performance
of its duties under this Agreement, but shall devote only so much of its time
and attention as it deems reasonable or necessary for such purposes.
SECTION 9. Successors and Assigns. This Agreement and all of
the provisions hereof shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns. This
Agreement and any of the rights, interests or obligations hereunder may be
assigned by the Advisor without the prior written consent of the Company. This
Agreement and any of the rights, interests or obligations hereunder may not be
assigned by the Company without the prior written consent of the Advisor, which
consent shall not be unreasonably withheld.
SECTION 10. Severability of Provisions. If any provision of
this Agreement shall be declared by a court of competent jurisdiction to be
invalid, illegal or incapable of being enforced in whole or in part, the
remaining conditions and provisions or portions thereof shall nevertheless
remain in full force and effect and enforceable to the extent they are valid,
legal and enforceable, and no provision shall be deemed dependent upon any other
covenant or provision unless so expressed herein.
SECTION 11. Entire Agreement; Modification. This Agreement and
the schedules hereto contains the entire agreement of the parties relating to
the subject matter hereof, and the parties hereto and thereto have made no
agreements, representations or warranties relating to the subject matter of this
Agreement which are not set forth herein. No amendment or modification of this
Agreement shall be valid unless made in writing and signed by each of the
parties hereto.
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SECTION 12. Non-Waiver. The failure of any party to insist upon the
strict performance of any of the terms, conditions and provisions of this
Agreement shall not be construed as a waiver or relinquishment of future
compliance therewith, and said terms, conditions and provisions shall remain in
full force and effect. No waiver of any term or condition of this Agreement on
the part of any party shall be effective for any purpose whatsoever unless such
waiver is in writing and signed by such party.
SECTION 13. Governing Law. The parties hereto acknowledge that the
transactions contemplated by this Agreement bear a reasonable relation to the
state of New York. This Agreement shall be governed by, and construed and
interpreted in accordance with, the internal laws of the state of New York
without regard to such state's principles of conflicts of laws. The parties
irrevocably and unconditionally agree that the exclusive place of jurisdiction
for any action, suit or proceeding ("Actions") relating to this Agreement shall
be in the state and/or federal courts situate in the county and state of New
York. Each party irrevocably and unconditionally waives any objection it may
have to the venue of any Action brought in such courts or to the convenience of
the forum. Final judgment in any such Action shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment, a certified or true
copy of which shall be conclusive evidence of the fact and the amount of any
indebtedness or liability of any party therein described. Service of process in
any Action by any party may be made by serving a copy of the summons and
complaint, in addition to any other relevant documents, by commercial overnight
courier to any other party at their address set forth in this Agreement.
SECTION 14. Headings. The headings of the Sections are inserted for
convenience of reference only and shall not affect any interpretation of this
Agreement.
SECTION 15. Counterparts. This Agreement may be executed in counterpart
signatures, each of which shall be deemed an original, but all of which, when
taken together, shall constitute one and the same instrument, it being
understood that both parties need not sign the same counterpart. In the event
that any signature is delivered by facsimile transmission, such signature shall
create a valid and binding obligation of the party executing (or on whose behalf
such signature is executed) the same with the same force and effect as if such
facsimile signature page were an original thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first written above.
SCORES HOLDING COMPANY INC.
By: /s/ Xxxxxxx Xxxxxxxx
-----------------------------
Xxxxxxx Xxxxxxxx, President
The Advisor
By: /s/ Xxxxx Xxxxxx
-----------------------------
Xxxxx Xxxxxx
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