Consulting Agreement
Preamble
THIS AGREEMENT, made and entered into this 8 day of May, 2000 by and
between WorldCast Interactive, Inc., a Florida corporation, having its principle
office at 00000 Xxxxx Xxxx 0, Xxxxx 000. Xxxx Xxxxx, Xxxxxxx 00000 ("Company"),
Perrins Management Corporation, California Corporation, having its principle
office at 0000 Xxxxxxxx Xxx, Xxx Xxxx, Xxxxxxxxxx 00000 ("Consultant") and
Xxxxxx X. Xxxxxxx, Xx., an individual, having his principal office at 0000
Xxxxxxxx Xxx, Xxx Xxxx, Xxxxxxxxxx 00000 ("Xxx Xxxxxxx").
Recitals
WHEREAS, Consultant represents that it has expertise in the area of
convergence integration of voice and data communications networks and is ready,
willing and able to provide consulting assistance to Company on the terms and
conditions set forth herein; and
WHEREAS, Company, in reliance on Consultant's representation, is
willing to engage Consultant as an independent contractor, and not as an
employee, on the terms and conditions set forth herein to provide services to
Company, including its subsidiaries, ConvergIT and Cable Tech, Inc.;
NOW THEREFORE, in consideration of the obligations herein made and
undertaken, the parties, intending to be legally bound, covenant and agree as
follows:
Agreement
Section 1
SCOPE OF SERVICES
1.1 Consultant shall provide consulting services ("Services") and shall
render reports and other deliverables ("Deliverables"), which are more fully
described in subsections 1.1a. and 1.1b., below to Company and/or its
subsidiaries ConvergIT and Cable Tech, Inc., (collectively referred to in this
Agreement as "Company"). Company and Consultant shall establish by mutual
consent, from time-to-time, written milestones and timetables applicable to the
Services and the Deliverables. In the event Consultant anticipates at any time
that it will not reach one or more milestones due to controllable or
uncontrollable circumstance within a prescribed timetable, Consultant shall
immediately so inform Company by written notice, submit proposed revisions to
the timetable and milestones that reflect Company's best estimates of what can
realistically be achieved, and continue to work under the original timetable and
milestones until otherwise directed by Company in writing. Consultant shall also
prepare and submit such further reports of its performance and its progress as
Company may reasonably request from time to time.
a. Services: Consultant shall (i) act as an advisor to the Board
of Directors of Company with respect to convergence technology
and the integration of communications systems and the
development of a stategic business model for the delivery of
convergence products and services to end-user customers; (ii)
act as an advisor to Senior Management of Company with respect
to technical applications of the business model, operational
structure, process management, marketing and sales tactics and
strategies; (iii) act as a liason between Company and its
suppliers, vendors, customers and consultants to maintain
existing favorable relationships; (iv) serve as a member of
the Lucent Technologies, Inc., SYSTIMAX VAR council (at the
pleasure of Lucent technologies, Inc.) and as a liason between
Company and the various divisions of Lucent Technologies,
Inc.; (v) act as an advisor to Senior Management and the Board
of Directors of Company with respect to potential strategic
business alliances including acquisitions and mergers.
b. Deliverables: Consultant shall (i) deliver periodic
recommendations to the Board of Directors and/or Senior
Management with respect to the services set forth in
subsection 1.1a., above; (ii) deliver periodic memoranda
and/or reports to Senior Management with respect to
Consultant's liasion functions on behalf of Company; (iii)
deliver periodic analyses, opinions and/or recommendations
regarding potential strategic business alliances to Senior
Management and the Board of Directors; (iv) deliver such
additional reports, memoranda and/or opinions with respect to
the Services as Company may reasonably request from time to
time.
1.2 Consultant shall provide and make available to Company such
resources as shall be necessary to perform the services called by this
Agreement.
1.3 Company shall provide the necessary tools, personnel, languages,
software source codes, computers, peripherals, and other basic items to enable
Consultant to perform the Services. At Company's discretion, these items may be
obtained from Consultant or any third party whom management feel should act as
Company's vending source.
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1.4 Company shall within 10 days of receipt of each Deliverable
submitted to Company, advise Consultant of Company `s rejection of such
Deliverable. Any rejection shall specify the nature and scope of the
deficiencies in such Deliverable. Consultant shall, upon receipt of such a
notice of rejection, act diligently to correct such deficiencies. The failure of
Company to provide a notice of rejection within such period shall constitute
acceptance by Company of said Deliverable.
1.5 Consultant shall require its employees to observe security and
safety policies of Company.
1.6 Company shall have the right, at any time, to request removal of
any employee(s) hired for any project either by Company or by Consultant whom
Company deems to be unsatisfactory for the purpose of Company's project. Upon
such a written request, Consultant shall use all reasonable efforts to promptly
replace designated party(ies) with a substitute competent party(ies) having
appropriate skills and training.
1.7 Anything herein to the contrary notwithstanding, the parties hereby
acknowledge and agree that Company shall have no right to control the manner,
means or methods by which Consultant performs the Services called for in this
Agreement. Company shall be entitled only to direct Consultant with respect to
the elements of the Services to be performed by Consultant and the results to be
derived by Company, to inform Consultant as to where and when such Services
shall be performed, and to review and access the performance of such Services by
Consultant for the limited purposes of assuring that such Services have been
performed and confirming that the results are satisfactory.
Section 2
TERM OF AGREEMENT
2.1 This Agreement shall commence on the date and year first above
written, and unless modified by mutual agreement of the parties or terminated
earlier pursuant to the terms of this Agreement, shall continue for an initial
term of two (2) years and shall automatically renew for successive one (1) year
terms, unless either party submits a letter of termination at least thirty (30)
days in advance of a renewal date.
2.2 Upon termination of this Agreement for any reason, Consultant shall
promptly return to Company all copies of any Company data, records, or material
of whatever nature of kind, including all materials incorporating the
proprietary information of Company. Consultant shall also furnish to Company all
work in progress or portions thereof, then in Consultant's possession.
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2.3 Within 30 days of termination of this Agreement for any reason,
Consultant shall submit to Company an itemized invoice for any fees or expenses
accrued, but unpaid, under this Agreement. Company shall remit payment of such
invoice in the manner specified in Section 3 of this Agreement. Upon
satisfaction of these obligations, the Company shall have no further liability
or obligation to Consultant whatsoever for any further fees, expenses or other
payments.
Section 3
FEES, EXPENSES, AND PAYMENT
3.1 In consideration of the Services to be performed by Consultant,
Company shall pay Consultant a consulting fee of $20,833 per month for an
initial term of two (2) years. During any renewal period under this Agreement,
Company shall pay Consultant a consulting fee at the rate of $20,833 per month.
Consulting fees shall be paid pursuant to written, itemized invoices issued by
Consultant and delivered to Company on a monthly basis. The terms of payment of
invoices shall be net ten (10) days based upon the date of invoice.
3.2 In further consideration of the the personal services of Xxx
Xxxxxxx provided in accordance with Section 10.04, Company shall grant and issue
to Xxx Xxxxxxx 3,760,00 units of WorldCast Interactive, Inc., Share Appreciation
Rights (SAR) convertible into 3,760,000 shares of common stock of the Company
(conversion ratio of 1:1). Alternatively, and at the sole election of Xxx
Xxxxxxx, each SAR unit may be converted into cash at the rate of $0.25 per SAR
unit. Xxx Xxxxxxx shall be restricted from making any election to convert SAR
units into either common stock or cash for a period of one (1) year from the
effective date of this Agreement, except as follows: Xxx Xxxxxxx may elect, at
his sole discretion, to convert a number of SAR units into common stock having a
maximum market value of sixty-two thousand five hundred dollars ($62,500.00),
once each calendar quarter, and require Company to effect an S-8 Registration of
such shares no more often than once each calendar quarter. These conversion and
S-8 Registration rights shall be cumulative, entitling Xxx Xxxxxxx to elect, at
his sole discretion, to defer the conversion and registration of eligible SAR
units to a subsequent calendar quarter. Any and all SAR units, which are
converted into common stock and traded on the NASDAQ Exchange shall be subject
to any and all applicable rules of the Securities and Exchange Commission (SEC).
3.3 In addition to the foregoing, Company shall pay Consultant for each
reasonable and necessary business expense incurred and paid by Consultant in
performance of his duties under this Agreement provided that:
a. Consultant submits a written request for reimbursement of the
expense accompanied by a receipt for expenses in excess of
twenty-five dollars ($25) indicating the nature and amount of
the expense (incidental expenses less than twenty-five dollars
($25) may be submitted by voucher without a receipt); and
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b. If the expense exceeds five hundred dollars ($500.00),
Consultant received prior written authorization from the
Treasurer of Company to incur such expense.
3.4 In the event of termination of this Agreement prior to the end of
the initial term due the incapacity, disability or death of Xxx Xxxxxxx, or the
termination of this Agreement by Company without cause, Consultant and Xxx
Xxxxxxx shall be entitled to payment of the unpaid balance of the fees for the
initial two (2) year period of this Agreement specified in Sections 3.1 and 3.2.
3.5 Concurrently with the date of closing of a merger between Company
and Cable Tech, Inc., Company shall loan $125,000 to Consultant. The terms of
the note representing the loan shall be mutually acceptable to Company and
Consultant.
Section 4
RIGHTS IN DATA
4.1 Except as set forth below in this Section 4, all right, title, and
interest in and to the programs, systems, data, or materials utilized or
produced by Consultant in the performance of the Services specified in this
Agreement shall be and remain the property of Consultant.
4.2 All right, title, and interest in and all Deliverables, including
all rights in copyright that may subsist therein, shall inure to Company and all
Deliverables shall be considered works made for hire. In the event that any
Deliverables shall be deemed not to constitute works made for hire, or in the
event that Consultant should otherwise, by operation of law, be deemed to retain
any rights to any Deliverables, Consultant shall execute any documents of
assignment or registration of copyright requested by Company respecting any and
all Deliverables. Nothing in this Section 4.2 or any other provision of this
Agreement shall preclude Consultant from providing services similar to the
Services and Deliverables to other clients of Consultant, subject to the the
protections afforded Company under this Section 4 and Section 5 of this
Agreement.
4.3 All right, title, and interest in and to any programs, systems,
data, and materials furnished to Consultant by Company are and shall remain the
property of Company including acquired sources of trade secrets, know how,
technology, and other work for hire materials from Consultant itself.
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Section 5
PROPRIETARY INFORMATION
5.1 Information disclosed by either party to the other in connection
with this Agreement is proprietary to the disclosing party and is communicated
in confidence. Nothing herein shall restrict recipient's right to disclose the
confidential information where such disclosure is required by written order of a
judicial, legislative, or administrative authority of competent jurisdiction, or
is necessary to establish its rights under this agreement, provided, however
that, in each case, recipient will first notify the disclosing party of such
need or requirement and cooperate with originator in limiting the scope of the
proposed disclosure. Recipient will assist disclosing party in taking all
reasonable steps for obtaining further appropriate means of limiting the scope
of the required disclosure of the disclosing party's confidential information.
Each party, as recipient of such information, shall hold such information in
confidence for so long as it is marked as confidential or proprietary if
disclosed in writing or of a confidential or proprietary character if discussed
orally. Each party shall use at least the same degree of care that the recipient
uses to protect its own confidential or proprietary information. Consultant
acknowledges that in order to perform the services called for in this Agreement,
it shall be necessary for Company to disclose to Consultant certain Trade
Secret(s) that have been developed by Company at great expense and that have
required considerable effort of skilled professionals. Consultant further
acknowledges that the Deliverables will of necessity incorporate such Trade
Secrets. Consultant shall not disclose such Trade Secrets to any employees or to
any third parties, excepting those who have a need to know such Trade Secrets
consistent with the requirements of this Agreement and who have undertaken an
obligation of confidentiality and limitation of use.
5.2 As used herein, the term "Trade Secret(s)" shall mean technical
data, operational data, information, design, process, procedure, formula, or
improvement that is commercially valuable to Company and not generally known in
the industry. The obligations set forth in Section 5.1 as they pertain to Trade
Secret(s) shall survive this Agreement and continue for so long as the material
remains a Trade Secret.
5.3 Company acknowledges that Consultant may be retained by other
clients and may engage in other business activiites which may or may not be
competitve with the business of Company, subject to the condition that
Consultant shall maintain the confidentiality of Company's proprietary
information and Trade Secrets in the manner specified in this Section 5 of this
Agreement.
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Section 6
CONFIDENTIALITY OF AGREEMENT; PUBLICITY; USE OF MARKS
6.1 For a period of two (2) years from the date of termination of this
Agreement, Consultant shall not disclose the nature of the effort undertaken for
Company or the terms of this Agreement to any other person or entity, except as
may be necessary to fulfill Consultant's obligation hereunder.
6.2 Consultant shall not at any time use Company's name or any
Company's trademark(s) or trade name(s) in any advertising without the prior
written consent of Company.
Section 7
WARRANTIES
7.1 Company warrants that it owns all right, title, and interest in and
any programs, systems, data, Value Added Reseller (VAR) license, or materials
furnished to Consultant hereunder even if obtained from the Consultant's past
development efforts.
7.2 Consultant warrants that:
a. Consultant's performance of services called for by
this Agreement does not and shall not violate any
applicable law, rule, or regulation; any contracts
with third parties; or any third party rights in any
patent, trademark, copyright, trade secret, or
similar right; and
b. Consultant has all rights necessary to convey to
Company the unencumbered ownership of the
Deliverables.
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Section 8
INDEMNIFICATION
8.1 Consultant hereby indemnifies and agrees to hold harmless Company
from and against any and all claims, demands, and actions, and any liabilities,
damages, or expenses resulting there from, including court costs and reasonable
attorney fees, arising out of or relating to the services performed by
Consultant hereunder or the warrantiesand against any and all claims, demands,
and actions, and any liabilities, damages, or expenses resulting there from,
including court costs and reasonable attorney fees, arising out of or relating
to the services performed by Consultant hereunder or the warranties made by
Consultant pursuant to Section 7.2 hereof. Consultant's obligation under this
Section 8.1 shall survive the termination of this Agreement for any reason.
8.2 Company agrees to give Consultant prompt notice of any such claim,
demand, or action and shall, to the extent Company is not adversely affected,
cooperate fully with Consultant in the defense and settlement thereof.
Section 9
LIMITATION OF LIABILITY
9.1 Except as provided in Section 8.1 hereof, neither party shall be
liable to the other for any consequential damages or lost profits of the other
party.
Section 10
MISCELLANEOUS
10.01 This Agreement constitutes the entire agreement between Company
and Consultant in connection with Consultant and Company which supersedes all
prior verbal and written agreements, understandings and negotiations and
discussions between the parties hereto in connection with the same.
10.02 This Agreement shall be construed and interpreted, and the rights
of the parties hereto determined in accordance with California law. Both parties
submit to the jurisdiction of California courts and Federal courts located in
California. The parties hereby agree that proper venue for any action or dispute
arising out of, in connection with, or concerning this Agreement shall be Santa
Xxxxx County, California.
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10.03 All notices and other communications required or permitted to be
given under this Agreement shall be in writing and shall be deemed to have been
given if delivered personally or sent by certified express mail, return receipt
requested, postage prepaid, to the parties to this Agreement at the following
addresses or to such other address as either party to this agreement shall
specify by notice to the other:
If to Company, at:
WorldCast Interactive, Inc. with a courtesy copy to:
00000 Xxxxx Xxxx 0, Xxxxx 000 XxxxxxxXX
Xxxx Xxxxx, XX. 33498 0000X Xxxxxxxx Xxx.
Xxx Xxxx, XX 00000
If to the Consultant, at: with a courtesy copy to:
Perrins Management Corporation Xxxxxx X. Xxxxxxx, Xx.
0000 Xxxxxxxx Xxx, 0000 Xxxxxxxx xxx
Xxx Xxxx, Xxxxxxxxxx 00000 Xxx Xxxx, Xxxxxxxxxx 00000
10.04 The Services provided by Consultant require the personal skills
and expertise of Xxx Xxxxxxx and may not be assigned without written approval
from Company. This Agreement may be assigned by Company and shall be binding
upon and inure to the benefit of its successors and assigns.
10.05 Except as otherwise herein provided, this Agreement may only be
modified by written Agreement executed by Company and Consultant.
10.06 The headings contained in this Agreement are provided for
convenience only and shall not be considered in construing, interpreting or
enforcing this Agreement.
10.07 Either party's failure to enforce strict performance of any
covenant, term, condition, promise, agreement or undertaking set forth herein
shall not be construed as a waiver or relinquishment of any other covenant,
term, condition, promise, agreement, or undertaking set forth herein or the same
covenant, term, condition, promise, agreement or undertaking at any time in the
future.
10.08 At any time, and from time to time, each party will execute such
additional instruments and take action as may be required by the other party to
carry out the intent and purposes of this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the
date first above written.
WorldCast Interactive, Inc.
----------------------------------------
Xxxxx Xxxxxx, CEO
Perrins Management Corporation
----------------------------------------
Xxxxxx X. Xxxxxxx, Xx., CEO
----------------------------------------
Xxxxxx X. Xxxxxxx, Xx., an individual
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Table of Contents
Consulting Agreement....................................................................................1
Preamble..............................................................................................1
Recitals..............................................................................................1
Agreement.............................................................................................1
Section 1.............................................................................................1
SCOPE OF SERVICES.....................................................................................1
Section 2.............................................................................................3
TERM OF AGREEMENT.....................................................................................3
Section 3.............................................................................................4
FEES, EXPENSES, AND PAYMENT...........................................................................4
Section 4.............................................................................................5
RIGHTS IN DATA........................................................................................5
Section 5.............................................................................................6
PROPRIETARY INFORMATION...............................................................................6
Section 6.............................................................................................7
CONFIDENTIALITY OF AGREEMENT; PUBLICITY; USE OF MARKS.................................................7
Section 7.............................................................................................7
WARRANTIES............................................................................................7
Section 8.............................................................................................8
INDEMNIFICATION.......................................................................................8
Section 9.............................................................................................8
LIMITATION OF LIABILITY...............................................................................8
Section 10............................................................................................8
MISCELLANEOUS.........................................................................................8
