CONSULTING AGREEMENT

CONSULTING AGREEMENT

CONSULTING AGREEMENT dated as of January 9, 2007, by and between American Basketball Association. (“ABA”), a Utah corporation with offices at 9421Holliday Drive, Indianapolis, IN and CONSULTANT, Xxxxxx Business Management Services (“CONSULTANT”) with offices at 00 Xxxx Xxxx Xxxxxx, Xxxxx 000, Xxxxxxxxx, XX 00000.

WITNESSETH:

WHEREAS, ABA and the CONSULTANT wish to enter into an agreement where ABA desires to retain the CONSULTANT as a CONSULTANT and CONSULTANT desires to act as a CONSULTANT to ABA, subject to and upon the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements set forth herein, the parties hereto agree as follows:

1. Consultancy. ABA hereby retains CONSULTANT and CONSULTANT hereby agrees to act as a CONSULTANT to ABA. CONSULTANT shall perform such services for ABA as agreed with the Board of Directors of ABA from time to time (the “Consulting Services”) including, but not limited to, the services specified in Appendix A to this agreement. CONSULTANT agrees to cause Xxxxxx X. Xxxxxx to perform the Consulting Services on behalf of the CONSULTANT. The CONSULTANT shall exercise its own reasonable judgment and employ such means as it, in good faith, determines are reasonable in performing the Consulting Services, and ABA will not exercise any control over the methods or means employed by the CONSULTANT in performing the Consulting Services. The Consulting Services shall be performed at such times and at such locations as CONSULTANT shall determine.

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2. Independent Contract or Status. It is understood and agreed that in the performance of the Consulting Services by the CONSULTANT hereunder, it is acting as an independent contractor and not in any way as an employee or agent of ABA. The CONSULTANT will determine the hours of work of its employees and the CONSULTANT’s employees are not required to work any specified number of hours in any week. Any time off, including weekends and vacation, will be solely and entirely at the discretion of the CONSULTANT. The CONSULTANT may be required upon request of the Board to submit to ABA written or oral reports regarding its activities. Employees of the CONSULTANT and others retained by the CONSULTANT are not employees of ABA for purposes of worker’s compensation, unemployment insurance, medical; disability and group life insurance and they are not eligible to participate in any welfare, pension, profit sharing or fringe benefit plan or arrangement of ABA.

3. Consulting Fees. During the Term, as full compensation for the Consulting Services, ABA shall pay to the CONSULTANT a consulting fee as described in Appendix A to this document. In addition to the Base Fee, the CONSULTANT shall be paid such additional compensation as shall be determined from time to time by the Board of Directors of ABA and approved by the Board of Directors of ABA as provided for in Appendix A. It is understood that ABA will not withhold any income taxes, unemployment taxes or other taxes and that the CONSULTANT is solely responsible for paying and reporting all taxes, including income taxes and estimates thereof for itself and all employees, agents or contractors. ABA will report to the appropriate tax authorities the amounts paid to the CONSULTANT and, even though the CONSULTANT is an independent contractor, if ABA is required by law, or is advised by its accountants or attorneys that it is required by law to deduct for withholding, or other taxes, it shall be free to do so, which taxes if not previously deducted shall be reclaimable from the CONSULTANT.

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4. Expenses. In addition to the consulting fees provided for in Section 3 above, ABA shall reimburse the CONSULTANT for reasonable costs and expenses incurred by the CONSULTANT in performing the Consulting Services, subject to review by the Board of Directors of ABA or a senior officer of ABA designated by the Board of Directors of ABA.

5. Use of ABA’s Facilities. Employees of the CONSULTANT are not required to use the office facilities of ABA in performing the Consulting Services hereunder.

6. Term. The term of this Agreement shall commence as of December 21, 2006 and shall continue for a period of twelve (12) months (the “Term”). At the option of the CONSULTANT and in agreement with ABA, exercisable by written notice delivered by the CONSULTANT to ABA not less than thirty (30) days prior to the end of the Initial Term, this Agreement shall be renewed for an additional three (3) months (the “Renewal Term”).

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7. Termination.

8.1 ABA may terminate this Agreement, at any time, upon thirty (30) days written notice, to CONSULTANT for any reason whatsoever.

8.2 Upon termination CONSULTANT shall cease all provision of services and no invoice shall be made for services performed after notice of suspension or termination. Upon termination, for any reason except breach of this agreement by CONSULTANT, of this Agreement or a portion of the services covered hereunder, ABA shall pay to CONSULTANT an amount equal to the Severance Amount as provided in Section 9 of this Agreement.

8.3 Termination of this Agreement or a portion of any services hereunder except for breach of this agreement by CONSULTANT shall not prejudice or affect the rights or remedies of either ABA or CONSULTANT against the other in respect of any breach of the Agreement which occurred before the effective date of termination and shall not prejudice the rights and remedies of CONSULTANT in respect of any sum or sums of money owed or owing from ABA.

8. Severance Payment. Upon termination of this Agreement by ABA or a change in control of ABA, in addition to earned but unpaid Consulting Fees payable in accordance with Section 3, ABA shall pay to CONSULTANT severance as identified in Appendix A.

9. Disclaimers and Limitations of Liability. It is expressly understood and agreed that ABA shall NOT be responsible nor liable for any loss, damage, penalty, or the like, financial or otherwise, caused by:

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(i) failure by any CONSULTANT, advisor, contractor, supplier, or any other persons, individuals or firms NOT employed by ABA to discharge its contractual obligations; or

(ii) any delay, modification, or suspension of the time schedule for performing the services hereunder whether agreed or not agreed with CONSULTANT, which is NOT the responsibility of ABA, its agents, or CONSULTANTs; or

(iii) any negligent work carried out by the CONSULTANT or by any third party other than ABA, its agents, or sub-CONSULTANTs, or employees; or

(iv) the failure of any person NOT employed or contracted with by ABA to discharge any legal duty or obligation whatsoever.

10. Confidentiality. The CONSULTANT hereby agrees that during and after the term of this Agreement, neither it nor any of its employees nor others retained by the CONSULTANT to perform some or all of the services to be performed hereunder, will divulge any confidential or proprietary information belonging to ABA or any company associated with ABA or to any customer of ABA and neither the CONSULTANT nor any employee of the CONSULTANT nor any other person retained by the CONSULTANT will make available to others any ABA or account list, price list, business plan, trade secret, document, file, paper or data of any kind, in whatever form embodied, concerning the business or financial affairs of ABA, its associated companies, or its customers or remove any of the foregoing from the premises of ABA.

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11. Assignment. Except as otherwise provided herein, the CONSULTANT may not assign this Agreement or delegate any of its obligations hereunder, without the prior written consent of ABA and ABA may not assign this Agreement, or delegate any of its obligations hereunder, without the prior written consent of the CONSULTANT. Any assignment or delegation in violation of the provisions hereof shall be void and of no effect.

13. Entire Agreement; Modification; Binding Effect. This Agreement constitutes the entire agreement between the CONSULTANT and ABA and supersedes all prior understandings and agreements concerning the subject matter hereof. This Agreement (including this provision against oral modification) may not be changed or terminated, and no provision hereof may be waived orally. No modification, waiver or termination hereof shall be binding upon either party unless in writing and signed by or on behalf of the party against which the modification, waiver or termination is asserted. This Agreement shall be binding upon and shall enure to the benefit of the CONSULTANT and ABA, their successors and permitted assigns.

14. Notices. Any notice or other communication required or permitted hereunder shall be sufficiently given if delivered personally, or, if sent by registered or certified mail, postage pre-paid, return receipt requested, addressed to the party intended to receive such notice at the address set forth above, or such other address as such party may indicate in the manner provided for notices herein. Any notice or communication shall be deemed to have been given upon the date personally delivered or, if mailed, the earlier of the date it is received and three (3) days after the date so mailed.

15. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York.

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IN WITNESS WHEREOF, the parties have signed this Agreement as of the date above written.

		AMERICAN BASKETBALL ASSOCIATION
	By:	/s/Xxx Xxxxxx
		Name: Xxx Xxxxxx
		Position: CEO

		XXXXXX BUSINESS MANAGEMENT SERVICES
	By:	/s/Xxxxxx X. Xxxxxx
		Name: Xxxxxx X. Xxxxxx
		Position: President

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APPENDIX A

App. 1 : The Base Fee for the Term of the Agreement shall be $ 102,000, payable in monthly installments at the beginningof each month as follows;

Month 1-3: $7,000.00	Month 4-6: $8,333.33
Month 7-9: $ 9,000.00	Month 10-12: $9,666.67

App. 2 : In addition to the Base Fee the CONSULTANT shall be paid such additional compensation as shall be determined from time to time by the Board of Directors of ABA and approved by the Board of Directors of ABA.

App. 3 : In determining the amount of the additional compensation The Board of Directors will take into consideration the attainment of specific criteria as agreed with the CONSULTANT from time to time.

App. 4 : The CONSULTANT shall provide services to ABA which shall include, but not be restricted to, those functions commonly associated with the role of Chief Financial Officer.

App. 5 : Stock Options. Consultant shall be entitled to participate in the ABA Equity Incentive Plan.

App 6 : Severance and Other Payments.

a. If Consultant's agreement pursuant to this Agreement is terminated for "cause" (as herein defined), the Company shall not be obligated to pay or provide any severance compensation or benefits to Consultant.

b. If Consultant's agreement with the Company is terminated under Paragraph 8.2 of this Agreement or the Company elects not to continue the Agreement under Paragraph 7 above, the Company agrees to pay to Consultant an amount equal to twenty-five percent (25%) of Consultant's then current annual base compensation (or, if this Agreement has expired, an amount equal to twenty-five percent (25%) of Consultant's annual base compensation on the last effective day of this Agreement's term). (“Severance Payment”). Such Severance Payment shall only be owed to Consultant and paid by the Company following the execution of a mutually agreeable severance agreement by Consultant and the Company that shall be written within 15 days of the date of Consultant’s termination. In addition to the foregoing Severance Payment.

App 7 : Travel, Entertainment, and Living Expenses. Consultant is authorized tocur reasonable travel, entertainment, and cell phone business expenses on behalf of the Company. These expenses shall be reimbursed by the Company.

App 8 : Consultant under this Agreement, the Company shall issue to Consultant (or its designees) 550,000 shares (“Shares”) of common stock, no par value (“Common Stock”). Issued upon the signing of this agreement.

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