CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT ("Agreement") made this 28th day of September, 2000,
by and between eSAFETYWORLD, Inc., whose address is 00 Xxxxxxx Xxxxx, Xxxxxxx,
Xxx Xxxx 00000, hereinafter referred to as the "Consultant," and Community Home
Mortgage Corporation, whose principal place of business is located at 000
Xxxxxxxxxxx Xxxx, Xxxxxxxx, XX 00000, hereinafter referred to as "Company."
WHEREAS, Consultant has developed expertise and experience in Internet-based
sales and other business applications. It desires to consult with the officers
of the Company, and the administrative staff, and to undertake for the Company
consultation as to the direction of certain functions in said management; and
WHEREAS, the Company desires to engage the services of Consultant as an
independent contractor and not as an employee to perform for the Company
consulting services regarding its business operation;
NOW, THEREFORE, it is agreed as follows:
1. Consultation Service. The Company hereby retains Consultant to
perform services in accordance with the terms and conditions of this Agreement.
Consultant will provide Company with advice regarding a variety of general
business and Business Business e-commerce applications.
2. Term of Agreement. The respective duties and obligations of the
contracting parties shall be for a period of one year commencing on September
28, 2000.
3. Time Devoted by Consultant. It is anticipated that Consultant will
spend the time necessary to perform the services set forth in this Agreement.
Services have already begun.
4. Place Where Services Are Rendered. Consultant will perform most of
the services in accordance with this Agreement at its offices. In addition,
Consultant may perform services by telephone or at other locations agreed to by
the parties.
5. Liability. With regard to the services to be performed by Consultant
pursuant to the terms of this Agreement, Consultant shall not be liable to the
Company, or to anyone who may claim any right due to any relationship with the
Company, for any acts or omissions in the performance of services on the part of
Consultant or on the part of the agents or employees of Consultant, except when
said acts or omissions of Consultant are due to willful misconduct or gross
negligence. The Company shall hold the Consultant free and harmless from any
obligations, costs, claims, judgments, attorneys' fees, and attachments arising
from or growing out of the services rendered to the Company pursuant to the
terms of this Agreement or in any way connected with the rendering of services,
except when the same shall arise due to the willful misconduct or gross
negligence of Consultant and Consultant is adjudged to be guilty of willful
misconduct or gross negligence by a court of competent jurisdiction.
6. Compensation. Initially, Consultant shall be required to expend
significant effort to familiarize itself with the Company's operations,
policies, procedures, opportunities, resources, strategic relationships, goals,
and other circumstances relevant to the services to be provided by Consultant.
The Company acknowledges that Consultant has already initiated the foregoing
activities in anticipation of entering into this Agreement with the Company.
After the Consultant's initial study of the Company's business and operations,
Consultant will then be required to devote significant effort to developing a
General Business and Internet strategy for the Company. The parties anticipate
that the key components of this strategy will be identified and formulated
within 90 days after the date of this Agreement. Thereafter, a substantially
smaller involvement will be required of Consultant as the Company considers,
adopts, and implements Consultant's recommendations. In recognition of the
foregoing, the Company shall pay to Consultant a fixed, one-time fee of $300,000
or that number of shares of common stock of the Company equivalent to 7.5% of
the number of the Company's common stock issued and outstanding as of the date
of this Agreement. Payment of this fee shall be made in either the cash or
common stock shall be at the option of the Company. Such payment shall be made
by the Company to Consultant within 30 days after the date of this Agreement. If
payment is made in the form of common stock, such shares of common stock shall
be deposited in an escrow account with a law firm selected by the Company and be
subject to a mutually acceptable escrow agreement. If Company is unable to clear
comments received from the Securities and Exchange Commission relating to the
Information Statement or Form 10, then Company shall be entitled to a refund of
all shares of its common stock previously paid to Consultant. If (i) an
Information Statement and Form 10 are prepared and the Company elects not to
file such documents with the Securities and Exchange Commission or (ii) the
Company does not cooperate in providing information necessary to clear comments
provided by the staff of the Securities and Exchange Commission, then Consultant
shall be entitled to a fee equivalent to 25% of the fixed, one-time fee set
forth above.
In the event the Company issues shares of common stock for compensation
to the Consultant hereunder, Consultant shall execute and deliver to the Company
the Consultant's representation letter setting forth relevant facts on which the
Company may rely in issuing the shares in reliance on exemptions from
registration under applicable federal and state securities laws. At the request
of the Board of Directors of the Consultant, the Company shall, at its expense,
either (i) register the public resale of such common stock under the Securities
Act of 1933, as amended, or (ii) satisfy the applicable requirements, including
the preparation and filing of an Information Statement and Form 10 or Form 10-SB
under the Securities Exchange Act of 1934 to enable the Consultant to distribute
such shares of common stock to the stockholders of the Consultant. Consultant
will assist Company in satisfying the foregoing requirements at no additional
cost to the Company. The total filing fees required under this paragraph are
expected to be less than $7,000.
Company and Consultant agree that, if Company pays the consulting fee
specified herein in the form of shares of common stock, it is Consultant's
intention to distribute such shares of common stock to its shareholders.
7. Reimbursement of Expenses. In addition, the Company shall reimburse
Consultant for any reasonable out-of-pocket expenses incurred by Consultant
pursuant to the terms of this Agreement. Such expenses must receive prior
approval from Company and will be paid as the expenses are incurred. It is
understood that Company will pay all costs and fees related to its obtaining
certified audits and filing fees relating to filings of documents with the
Securities and Exchange Commission, state securities agencies, NASDAQ or any
similar regulatory agency.
8. Company Information. In connection with Consultant's engagement, the
Company will furnish Consultant with any information concerning the Company that
Consultant reasonably deems appropriate. Company will pay the costs of producing
the information required herein including the cost of an audit by auditors
authorized to practice before the Securities and Exchange Commission. Company
will provide Consultant with access to the Company's officers, directors,
accountants, counsel, and other advisors. In order to facilitate the foregoing,
the parties agree as follows:
(a) The Company represents and warrants to Consultant that all such
information concerning the Company will be true and accurate in all material
respects and will not contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein not
misleading in light of the circumstances under which such statements are made.
The Company acknowledges and agrees that Consultant will be using and relying
upon such information supplied by the Company and its officers, agents, and
others and any other publicly available information concerning the Company
without any independent investigation or verification thereof or independent
appraisal by Consultant of the Company or its business or assets.
(b) Consultant understands that certain information to be provided by
the Company concerning the business and operations of the Company, its
subsidiaries, and affiliates will be confidential information and will be
treated by Consultant as such. Consultant will not, directly or indirectly, make
use of such information or divulge any such information to others except as
authorized by the Company.
(c) Upon termination of this Agreement, Consultant will surrender to
the Company all records obtained by Consultant from the Company or entrusted to
Consultant during the course of this Agreement (together with all copies
thereof) that are conspicuously marked on their face by the Company as
"limited," "private," "confidential," or similarly to indicate their
confidential nature.
9. Consultant Independent Contractor. Consultant is engaged under the
terms of this Agreement as an independent contractor, and nothing herein shall
be construed as creating an employer/employee relationship between the parties.
Consultant shall not have the authority to make any decisions with respect to
any matter as to which Consultant renders consulting services or to enter into
agreements or contracts on behalf of the Company or otherwise bind the Company.
Consultant shall be solely liable for the payment of any taxes imposed or
arising out of the payment of compensation to Consultant under this Agreement.
10. Assignment/Benefits. The benefits of this Agreement shall inure to
the benefit of the respective successors and assigns of the parties hereto and
of the indemnified parties hereunder and their successors and assigns and
representatives, and the obligations and liabilities assumed in this Agreement
by the parties hereto shall be binding upon their respective successors and
assigns, provided, however, that Consultant shall not assign or permit any other
person or entity to assume its obligations hereunder without the prior written
approval of the Company. The Company shall provide Consultant with notice of its
consent or withholding of such consent within ten days after approval has been
requested.
11. Equitable Relief. Consultant acknowledges that any breach or
threatened breach or alleged breach or threatened alleged breach by Consultant
of any of the provisions of this Agreement can cause irreparable harm to the
Company or its subsidiaries or affiliates, for which the Company would have no
adequate remedy at law. In the event of a breach or threatened breach or an
alleged breach or alleged threatened breach by Consultant of any of the
provisions of this Agreement, the Company, in addition to any and all other
rights and remedies it may have under this Agreement or otherwise, may
immediately seek any judicial action which the Company may deem necessary or
advisable including, without limitation, the obtaining of temporary and
preliminary injunctive relief.
12. Notice. Any notice, demand, request, or other communication
permitted or required under this Agreement shall be in writing and shall be
deemed to have been given if personally served; if transmitted by facsimile if
receipt is confirmed by the facsimile operator of the recipient; if sent by
electronic mail if receipt is acknowledged by the recipient; if delivered by
overnight courier service; or if mailed by certified mail, return receipt
requested, addressed as follows:
If to the Company: Community Home Mortgage Corporation
000 Xxxxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attn: Xxx Xxxxxxxxx, President
Facsimile No.: 000-000-0000
If to Consultant: eSAFETYWORLD, Inc.
00 Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxx, President
Facsimile No.: 000-000-0000
or such other addresses, facsimile numbers, or electronic mail address as shall
be furnished in writing by any party in the manner for giving notices hereunder,
and any such notice, demand, request, or other communication shall be deemed to
have been given as of the date so delivered or sent by facsimile transmission or
electronic mail, one day after the date so sent by overnight delivery, or three
days after the date so mailed.
Either party may change its address for notice purposes by giving notice to the
other party pursuant to the above provision.
13. Headings. The headings of the paragraphs herein have been inserted
for ease of reference only and shall not control or affect the meaning or
interpretation of any of the terms and provisions hereof.
14. Governing Law. This Agreement is entered into under and shall be
governed by the laws of the state of New York, excluding law respecting the
choice or conflicts of law.
15. Further Action. The parties hereby agree to execute and deliver
such additional documents and to take such further action as may become
necessary or desirable to fully carry out the provisions and intent of this
Agreement.
16. Form of Execution. A valid and binding signature hereto or any
notice, demand, request, or other communication required or permitted hereunder
may be in the form of a manual execution of a document or a true copy made by
photographic, xerographic, or other electronic process that provides similar
copy accuracy of a document that has been manually executed.
17. Enforcement. In the event of a dispute between the parties arising
under this Agreement, the prevailing party in such dispute shall be entitled to
recover its costs, including reasonable attorneys' fees, from the other party.
18. Nonwaiver. The failure of any party to exercise its rights in the
event of a breach of any of the terms and provisions of this Agreement by the
other party shall not constitute a waiver of any damages attributable to such
breach nor a waiver of any such rights with respect to future, similar breaches.
19. Arbitration. Any controversy or claim arising out of or relating to
this Agreement, or the breach thereof, shall be resolved by arbitration in
accordance of the rules of the American Arbitration Association in the City of
New York, and judgment upon the award rendered by the arbitrator(s) shall be
entered in any court having jurisdiction thereof. For that purpose, the parties
hereto consent to the jurisdiction and venue of an appropriate court located in
New York County, State of New York. In the event that arbitration results from
or arises out of this Agreement or the performance thereof or litigation to
enforce any award entered therein, the parties agree to reimburse the prevailing
party's reasonable attorney's fees, court costs, and all other expenses, whether
or not taxable by the court as costs, in addition to any other relief to which
the prevailing party may be entitled. In the event of any such claim or
controversy, no action shall be entertained by said arbitration if initiated
more than one year subsequent to the date the cause(s) of action actually
accrued regardless of whether damages were otherwise as of said time calculable.
IN WITNESS WHEREOF, the parties have hereunto executed this Agreement on the
28th day of September, 2000.
eSAFETYWORLD, Inc.
By: /s/ Xxxxxx X. Xxxx
--------------------------
Its: President
COMMUNITY HOME MORTGAGE CORPORATION
By: /s/ Xxx Xxxxxxxxx
--------------------------
Its: President
