CONSULTING AND SERVICES AGREEMENT
This Consulting and Services Agreement (this "Agreement")
is entered into as of April 14, 2000, between Xxxxxx
Xxxxxxxxxxxxx.xxx, Inc., a California corporation (the
"Company"), and eConnect, a Nevada corporation ("Consultant").
In consideration of the mutual covenants and agreements set
forth below, the parties hereby agree as follows:
1. Term. The Company hereby retains Consultant as an
independent consultant, with the duties particularized in
Section 2 hereof and subject to the other terms and conditions
particularized herein, and Consultant hereby agrees to act as
such for the Company, for the period commencing on the date
hereof and expiring on the completion by Consultant of the
Services (as defined in Section 2 hereof), unless terminated by
the Company for "cause" or by the mutual consent of the parties
hereto prior thereto (such period, including as so terminated,
shall be referred to hereinafter as the "Term"). For purposes
of this Agreement, "cause" shall mean either of the following:
(a) a willful breach by Consultant of any material provision of
this Agreement that remains uncured by Consultant thirty (30)
days after written notice of such breach is given to Consultant
by the Company; or (b) a willful failure or refusal to perform
Consultant's duties hereunder that remains uncured by Consultant
thirty (30) days after written notice of such breach is given to
Consultant by the Company.
2. Duties. During the Term, Consultant shall devote its
reasonable best efforts to performing the Services (as defined
hereinbelow) on behalf of the Company, at such reasonable times
and places as are determined by Consultant. The Company
understands and hereby expressly acknowledges that the Services
to be provided to the Company by Consultant pursuant to the
terms hereof shall be on a non-exclusive basis only. As
employed in this Agreement, Services shall mean: (i) designing
and developing, in consultation with the Company, an on-line
media portal environment the ("Website") (a) dedicated to the
release and distribution of motion pictures, the marketing of
entertainment-industry related products, and the provision of
related services and advertising, and (b) offering, in addition,
the specific content and consumer interactive services described
in the succeeding sentence (the "Website Design Consulting
Services"), (ii) transferring to the Company for no
consideration 2,000 private label-branded (as directed by the
Company) eCashPad terminals to be distributed by the Company, on
a trial basis, at no charge to users of the Website, (iii) all
other services reasonably necessary to adapting the eCashPad and
ancillary technology so as to serve as a secure electronic card
payment platform for use by visitors to the Website; and (iv)
entering into contractual arrangements with the issuers of not
less than five major credit cards and with not less than ten
national banks that are issuers of ATM cards, pursuant to which
the vendors whose goods and services are purchased by visitors
to the Website via the use of any such card in conjunction with
an eCashPad terminal would be charged a transaction fee by the
issuer of which $1 thereof per transaction would be remitted to
Consultant (collectively, "eConnect Merchant Fees"). The
Company currently contemplates that the following content and
consumer interactive services, inter alia, be provided by it
through the Website, and Consultant agrees to structure and
perform the Website Design Consulting Services accordingly: chat
rooms; message boards; celebrity interviews; entertainment
industry "light gossip" columns; film reviews; movie times and
showings; entertainment industry insider informational services;
web space for the promotion of student/independent films; and
movie paraphernalia auctions. Notwithstanding any other
provision of this Agreement, the Company hereby acknowledges
that Consultant shall be deemed to have completed the Website
Design Consulting Services at the point in time that Consultant
shall have expended a total of $100,000 in direct, out-of-pocket
costs and reasonable allocable overhead in the performance
thereof.
3. Consideration to Consultant for Services. In
consideration of the Services to be rendered by Consultant to
the Company pursuant to the terms hereof, the Company shall pay
Consultant an aggregate consulting and services fee in the
amount of $500,000, $100,000 of which is to be paid upon
execution of this Agreement, $250,000 of which is to be paid
upon delivery to the Company of 2000 private label-branded
eCashPad terminals, as provided for in Section 2 hereof, and the
balance of which is to be paid upon completion of the Services.
In the event that this Agreement is terminated in accordance
with the provisions of Section 1 hereof prior to Consultant's
completion of the Services, the Company shall not be required to
pay the entire amount of such balance, but only a portion
thereof prorated through the date of such termination.
4. Expenses. Except as otherwise expressly provided for
in this Agreement, Consultant shall be entirely responsible for
all expenses of every nature and description incurred by it,
directly or indirectly, in performing the Services, including,
without limitation, the costs of equipment and materials and the
compensation payable by Consultant to its employees, consultants
and advisors in connection with its performance of Services.
5. Independent Contractor Relationship; Duty of
Cooperation. It is understood and agreed that Consultant's
relationship to the Company is that of an independent contractor
and that neither this Agreement nor the Services to be rendered
hereunder shall for any purpose whatsoever or in any way or
manner create any partnership or joint-venture relationship
between the parties. The Company agrees to cooperate fully with
Consultant in order to allow Consultant to discharge efficiently
its obligations to provide the Services to the Company
hereunder.
6. License Agreement; Sharing of e-Connect Merchant Fees.
Simultaneously with its delivery to the Company of private
label-branded eCashPad terminals, as provided for in Section 2
hereof, Consultant agrees to enter into an irrevocable,
worldwide, royalty-free license agreement with the Company,
which will permit the Company to use such terminals in the
manner contemplated by this Agreement without violating any
intellectual property rights of Consultant or any third party,
and containing such other terms and conditions as are reasonably
acceptable to each of the parties hereto. Each eConnect
Merchant Fee received by Consultant shall be split 50/50 with
the Company, with Consultant hereby agreeing to remit to the
Company on or before the 15th day of each calendar month 50% of
the total amount of eConnect Merchant Fees received by it in the
preceding calendar month. The provisions of this Section 6
shall survive indefinitely the expiration or termination of this
Agreement.
7. Miscellaneous.
(a) Any and all notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given
when delivered personally or seventy-two (72) hours after being
mailed, certified or registered mail, returned receipt
requested, postage pre-paid, to Consultant's or the Company's
address shown below. The Company and Consultant may change
their respective addresses for the purposes of notice at any
time by the giving of notices pursuant to this subparagraph.
Company: Xxxxxx Xxxxxxxxxxxxx.xxx, Inc.
c/o Kavanaugh Consulting, Inc.
000 Xxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxx Xxxxxx, XX 00000
Consultant: eConnect
0000 Xxx Xxxxxxxx Xxxxxx
Xxxxx 000
Xxx Xxxxx, XX 00000
Attn.: Xxxxxx X. Xxxxxx
Chief Executive Officer
(b) Time is of the essence of this Agreement with respect
to each and every provision of this Agreement as to which time
is a factor.
(c) No change in, modification of, addition to, or
amendment or supplement of, this Agreement shall be valid unless
set forth in writing and signed and dated by both parties
subsequent to the execution of this Agreement.
(d) The Company and Consultant, without the necessity of
any further consideration, agree to execute and deliver such
other documents and take such other actions as may be necessary
or desirable to consummate more effectively the purposes and
subject matter of this Agreement.
(e) The existence, validity, construction and operational
effect of this Agreement and the rights and obligations of the
Company and Consultant hereunder shall be determined in
accordance with the laws of the State of California; provided,
however, that any provision of this Agreement which may be
prohibited by law or otherwise held invalid shall be ineffective
only to the extent of such prohibition or invalidity and shall
not invalidate or otherwise render ineffective any or all of the
remaining provisions of this Agreement.
(f) The parties firmly desire to resolve all disputes
arising hereunder without resort to litigation in order to
protect their respective business reputations and the
confidential nature of certain aspects of their relationship.
Accordingly, any controversy or claim arising out of or relating
to this Agreement, or the breach thereof, shall be settled by
arbitration as set forth below:
(i) All disputes which in any manner arise out of or
relate to this Agreement or the subject matter thereof, shall be
resolved exclusively by arbitration in accordance with the
provisions of this Section 7(f). Either party may commence
arbitration by sending a written demand for arbitration to the
other party, setting forth the nature of the controversy, the
dollar amount involved, if any, and the remedies sought, and
attaching a copy of this Section 7(f) to the demand.
(ii) The parties stipulate to arbitration before a
single, mutually agreed upon arbitrator sitting on the Los
Angeles, California Judicial Arbitration Mediation Services
(JAMS) panel. In the event that the parties are unable to agree
upon the person chosen as arbitrator within 30 days of the
demand for arbitration, the arbitrator shall be selected in the
sole discretion of the JAMS administrator. The arbitrator shall
be a member of the California bar.
(iii) The parties shall share all costs of
arbitration. The prevailing party shall be entitled to
reimbursement by the other party of such party's attorneys' fees
and costs and any arbitration fees and expenses incurred in
connection with the arbitration hereunder.
(iv) The substantive law of the State of California
shall be applied by the arbitrator. All proceedings in
arbitration shall be in accordance with the California Code of
Civil Procedure, as amended, and the parties shall have the
right to legal discovery in any matter submitted to arbitration
in satisfaction of California Code of Civil Procedure Section
1283.05, as permitted by California Code of Civil Procedure
Section 1283.1(b).
(v) Arbitration shall take place in Los Angeles,
California unless the parties otherwise agree. As soon as
reasonably practicable, a hearing with respect to the dispute or
matter to be resolved shall be conducted by the arbitrator. As
soon as reasonably practicable thereafter, the arbitrator shall
arrive at a decision, which shall be in writing and signed by
the arbitrator, shall set forth a concise statement of the
reasons for the arbitrator's decision, and shall be sent to the
parties and their legal counsel by certified mail, return
receipt requested, no later than thirty (30) calendar days
following the conclusion of the hearing. The arbitrator will
announce his or her decision, which will not become final for
twenty (20) days after it is received by each party and its
counsel (which may be extended for a reasonable period by the
arbitrator should any party contest or request that the
arbitrator revoke or change his or her decision). Each party
will have ten (10) days after receipt of the decision to file
any papers to contest or request that the arbitrator change or
revoke such decision. The arbitrator will have the right to
amend and/or retract his or her decision prior to the date the
decision becomes final. If the arbitrator does alter or revoke
the decision, any altered or new decision will be treated as a
decision subject to the same terms of this Section 7(f)(v)
(i.e., it will be effective 20 days after it is delivered to
each party and each party will have 10 days to contest or
request a change or revocation).
(vi) All decisions of the arbitrator, subject to the
procedures of Section 7(f)(v), shall be final, binding and
conclusive on the parties and shall constitute the only method
of resolving disputes or matters subject to arbitration pursuant
to this Agreement. The arbitrator or a court of appropriate
jurisdiction may issue a writ of execution to enforce the
arbitrator's judgment. Judgment may be entered upon such a
decision in accordance with applicable law in any court having
jurisdiction thereof.
(vii) Notwithstanding the foregoing, because time
is of the essence of this Agreement, the parties specifically
reserve the right to seek a judicial temporary restraining
order, preliminary injunction, or other similar equitable
relief.
(viii) The decision and award of the arbitrator
shall be kept confidential by the parties to the greatest extent
practicable. No disclosure of such decision or award shall be
made by the parties except as required by law or as necessary or
appropriate to effect the enforcement thereof.
(g) The covenants, agreements, representations,
warranties, terms and conditions contained in this Agreement
shall be binding upon and inure to the benefit of the successors
and assigns of the Company and Consultant; provided, however,
that Consultant may not assign or transfer Consultant's duties
to provide the Services hereunder except upon the written
consent of the Company in its sole and absolute discretion.
(h) This Agreement constitutes the entire agreement
between the parties as to the subject matter hereof and
supersedes and terminates as of this date any prior agreements,
whether written or oral, between the parties with respect
thereto. No provision of this Agreement shall be waived except
in writing signed by the party against whom such waiver is
asserted. Any such waiver shall be limited to the particular
instance, and waiver of a provision in one instance shall not
prevent a party thereafter from enforcing each and every other
provision of this Agreement.
(i) The section headings used in this Agreement are
intended solely for convenience of reference, and shall not in
any way or manner amplify, limit, or modify, or otherwise be
used in the interpretation of, any of the provisions of this
Agreement, and the masculine, feminine, or neuter gender and the
singular or plural number shall be deemed to include the others
whenever the context so indicates or requires.
(j) The Company and Consultant each hereby represents and
warrants that it has the necessary power and authority to enter
into and deliver this Agreement, to perform its obligations
hereunder and to consummate the transactions contemplated
hereby, and that such actions have been duly authorized by,
respectively, the Company and the Consultant in accordance with
applicable law.
IN WITNESS WHEREOF, the parties hereto have respectively
executed this Consulting and Services Agreement as of the date
first written above.
"THE COMPANY"
XXXXXX XXXXXXXXXXXXX.XXX, INC.
By: /s/ Xxx Xxxxxx
Xxx Xxxxxx, President
"CONSULTANT"
eCONNECT
By: /s/ Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx, President
