CONSULTING AND COMPENSATION AGREEMENT
THIS CONSULTING AND COMPENSATION AGREEMENT (the "Agreement") is entered
into this 25th day of March, 2000 by and between eCom xXxx.xxx, Inc., a
Florida corporation ("Consultant"), having its business address at 0000 XXX
Xxxxxxxxx, Xxxxx 0000, Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000 and xXxxXXX.xxx,
Inc., a Florida corporation ("Corporation"), having its business address at
0000 XXX Xxxxxxxxx, Xxxxx 000, Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000.
W I T N E S S E T H:
WHEREAS, Corporation is engaged in the business of marketing professional
employer products and services on behalf of Professional Employer
Organizations and securing clients for those Professional Employer
Organizations (the "Business");
WHEREAS, Consultant has knowledge and is engaged in the business of
providing internet technology services for corporate presence development and
is a qualified supplier of internet technology services to companies in the
United States; and
WHEREAS, Corporation desires to engage Consultant in order to assist
Corporation in furthering certain objectives of Corporation; and
WHEREAS, Consultant has agreed to provide certain services to Corporation
and, Corporation has agreed to provide certain facilities, amenities, support
and compensation to Consultant pursuant to the terms and conditions of this
Agreement; and
WHEREAS, as a result of the provision of the services by Consultant to
Corporation, Consultant may have access to certain Confidential Information
and Trade Secrets (as such term is hereinafter defined) belonging to
Corporation.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Corporation and Consultant agree
as follows:
1. Recitals. The recitals hereinabove set forth are acknowledged by
the parties to be true and correct and are incorporated herein by reference.
2. Scope of Services.
(a) During the Term (as such term is hereinafter defined),
Consultant shall provide certain services (collectively, the "Services") to
Corporation which Services shall include but may not be limited to the use of
Consultant's skill, experience, background and expertise to assist Corporation
with the implementation of the Corporation's internet web presence through the
design, development and creation of web pages, maintenance of Corporation's
internet sites, web hosting services, e-commerce programming, internet
technology consulting, data management, internet training, internet marketing,
establishing Brand identity and presence, development and implementation of an
effective internet marketing campaign. In addition, the Services shall
include such other duties, not inconsistent herewith, as shall be reasonably
assigned to Consultant by Corporation from time to time.
(b) Consultant shall devote so much of Consultant's business
time to the provision of the Services as may be required in order to timely
and properly accomplish the objectives of Corporation, and Consultant shall
use Consultant's best efforts, judgment, skill and energy to perform such
Services in a manner consonant with the requirements of this Agreement and in
a manner designed to improve and advance the Business and the interests of
Corporation.
(c) During the Term (as such term is hereinafter defined),
Corporation may, as reasonably required by Consultant in order to undertake
and accomplish the Services, provide certain facilities, amenities, support
and supplies (collectively, the "Facilities") to Consultant which Facilities
shall include, but may not be limited to, interior office space, use of
photocopying and other office equipment, miscellaneous office supplies,
cooperation of Corporation management, adequate incoming and outgoing
telephone connections for use by Consultant and adequate electrical service to
operate any required equipment, and any such other Facilities upon which
Consultant and Corporation may agree.
3. Term. The term of this Agreement ("Term") shall commence upon
execution of this Agreement by Corporation and Consultant and shall continue
for a period of one (1) year or until the Date of Termination (as such term is
defined hereinafter).
4. Termination.
(a) Corporation may terminate this Agreement after thirty (30)
days prior written notice from Corporation to Consultant (a "Corporation
Termination Notice") for any reason. Notwithstanding the foregoing,
Corporation may terminate this Agreement, immediately and without any
Corporation Termination Notice as a result:
(1) of misfeasance, malfeasance, negligence, dishonesty,
misconduct or insubordination in connection with Consultant's engagement
hereunder or as a result of the breach by Consultant of any law, of any
fiduciary duty due to Corporation or of any of the terms and conditions of
this Agreement; or
(2) at any time after Consultant has devoted ninety (90)
days to the completion of the Services should Corporation determine, in the
exercise of the sole and exclusive judgement of Corporation, that the results
obtained by Consultant are not satisfactory to Corporation.
(b) Consultant may terminate this Agreement after thirty (30)
days prior written notice from Consultant to Corporation (a "Consultant
Termination Notice") for any reason.
2
(c) Upon receipt of a Corporation Termination Notice or a
Consultant Termination Notice, as the case may be, the Date of Termination of
this Agreement shall be the date specified in such Corporation Termination
Notice or a Consultant Termination Notice, as the case may be, or if no
Corporation Termination Notice is required pursuant hereto the Date of
Termination shall be the date designated by Corporation.
(d) Notwithstanding any termination of this Agreement, all terms
and conditions of this Agreement intended to survive the termination of the
Agreement shall remain in full force and effect.
(e) Promptly following expiration of the Term or other
termination of this Agreement, Consultant shall return to Corporation all
property of Corporation, including but not limited to keys, motor vehicles,
computers, peripheral devices, software, computer source code, telephone and
voice mail directories, policy and procedure manuals, books, proposals,
writings, designs, documents, records, data, memoranda, files, records,
layouts, system design information, models, manuals, documentation, notes and
all other material of any nature belonging to Corporation in Consultant's
possession or under Consultant's control and without retaining any copies
thereof and whether or not same is deemed Confidential Information and Trade
Secrets (as such term is hereinafter defined).
5. Compensation. Corporation shall pay Consultant for the Services
(the "Compensation") as follows:
(a) a non-refundable payment in the amount of One Hundred
Thousand and No/100 Dollars ($100,000.00) (the "Cash Portion") in readily
available U.S. funds; and
(b) Corporation shall issue to Consultant Five Hundred Thousand
(500,000) shares of the $.0001 par value common stock of the Corporation (the
"Compensation Shares"). In connection with the Compensation Shares:
(A) Corporation shall, as promptly as practicable,
execute and deliver or cause to be executed and delivered a certificate
evidencing the Compensation Shares. Corporation shall pay all expenses, taxes
and other charges payable in connection with the preparation, issuance and
delivery of such certificates.
(i) Consultant understands that:
a. the Compensation Shares will not have
been offered or sold pursuant to a registration statement under the Securities
Act of 1933, as amended (the "Act"), that the Compensation Shares will not
have been registered under the Act or any other applicable federal or state
statute;
b. the Compensation Shares may not be
capable of being transferred, sold or otherwise disposed of unless registered
under the Act or pursuant to an exemption therefrom.
c. that a legend shall be imprinted on the
face of each certificate representing the Compensation Shares as follows:
3
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT"). THE SECURITIES HAVE
BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF A CURRENT AND EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT WITH RESPECT TO SUCH SECURITIES, OR AN OPINION OF THE
ISSUER'S COUNSEL TO THE EFFECT THAT REGISTRATION IS NOT REQUIRED UNDER THE
ACT.
d. that Consultant will be required to
represent and warrant that the Compensation Shares will be acquired for
investment for Consultant's own account, not as a nominee or agent, and not
with the view toward, or for resale in connection with, any distribution
thereof.
e. that Consultant will be required to
acknowledge that the Compensation Shares must be held indefinitely unless
subsequently registered under the Act or an exemption from such registration
is available.
(c) Full Discharge of Corporation's Obligations. The
Compensation payable to Consultant pursuant hereto shall be the only amounts
due from Corporation to Consultant, and when such Compensation is paid in
accordance herewith, same shall be payment in full and complete satisfaction
of Consultant's rights under this Agreement and any other claims Consultant
may have with respect to Consultant's engagement by Corporation.
(d) Compensation in the event of Termination.
(1) Corporation understands that a substantial portion of
the Services to be provided hereunder will occur during the first ninety (90)
days after execution hereof. Accordingly, so long as this Agreement is not
terminated prior to ninety (90) days after the execution hereof, the
Compensation shall be deemed to have been earned in full and in the event of a
termination after such ninety (90) days, no refund of the Cash Portion or the
Compensation Shares shall be due from Consultant to Corporation.
(2) If, however, this Agreement is terminated prior to
ninety (90) days after execution hereof, the Compensation shall be deemed to
be earned on a pro-rata basis during such first ninety (90) days, and upon any
such termination, Consultant shall refund the appropriate unearned pro-rata
portion of the Cash Portion and the Compensation Shares.
6. Covenants of Consultant.
(a) Covenant regarding Work Product. Consultant hereby
acknowledges and agrees that all right, title and interest in and to any work
product conceived or produced by Consultant in connection with the provision
of the Services or conceived or produced with the use or assistance of the
facilities, materials or personnel of Corporation shall be owned exclusively
by Corporation and such work product shall be for all purposes considered as
"work made for hire" unless otherwise specifically agreed to in writing by
Corporation and Consultant.
(b) Covenant regarding Confidential Information and Trade
Secrets.
4
(1) Definition. For the purposes hereof, the term
"Confidential Information and Trade Secrets" shall mean any and all
information not generally available to the public other than as a result of a
breach of this Agreement that was obtained from Corporation or any customer,
client, vendor or business associate of Corporation or that was learned,
discovered, conceived, originated or prepared as a result of the performance
by Consultant on behalf of Corporation, including but not limited to
communications, financial statements, documents, customer lists, customer
requirements, business plans, supplier lists or information, pricing
information, vendor information, biographical information, market studies and
analysis, technology, designs, processes or formulae, existing or contemplated
products or product information, services or service information,
transportation and distribution information and all such information,
documents, items or communication related to Corporation, and whether or not a
confidentiality label or other legend is affixed to any of same, provided,
however, that such definition shall not apply to the extent that such
information:
(A) is or becomes generally available to the public
other than as a result of a breach of this Agreement;
(B) was within possession of Consultant prior to it
being disclosed to Consultant by Corporation;
(C) was obtained by Consultant from a third party
having the right to disclose such information.
(2) Disclosure of Confidential Information and Trade
Secrets.
(A) Consultant hereby acknowledges that during the
Term, Consultant will acquire access to Confidential Information and Trade
Secrets, and except to the extent specifically authorized by Corporation in
writing or as may be required by law, court decree or governmental order,
Consultant shall not at during the Term or at any time thereafter disclose to
others, use for Consultant's own benefit or otherwise appropriate or copy any
Confidential Information and Trade Secrets, whether or not any such
Confidential Information and Trade Secrets was developed by Consultant
pursuant hereto or otherwise.
(B) During the Term and at all times thereafter,
Consultant shall not claim any proprietary interest in the Confidential
Information and Trade Secrets.
(C) During the Term and at all times thereafter,
Consultant shall take all reasonable action, which shall be necessary or
appropriate, to prevent the unauthorized use and disclosure of the
Confidential Information and Trade Secrets, and to protect the interests of
Corporation in and to the Confidential Information and Trade Secrets.
(c) Covenants Not to Compete. During the Term and during the
twelve (12) month period following expiration of the Term (the "Restricted
Period"), Consultant shall not:
5
(1) undertake, directly or indirectly, the performance of
any programming services of a nature substantially similar to the Services
provided hereunder, whether as an employee or otherwise, and whether paid or
unpaid, to any Third Party, provided that the Services are expected to result
in a product or service that would be competitive the products or services of
Corporation; and
(2) become associated with any entity, whether as a
principal, partner, employee, consultant, manager, beneficiary of any trust or
shareholder (other than as a holder of not in excess of five percent (5%) of
the outstanding voting shares of any publicly traded company), that is a
Competitor (as hereinafter defined) of Corporation.
(3) For the purposes hereof, a Competitor of Corporation
shall be defined as any person, firm, corporation or other party or entity
that provides services or products that are substantially the same as those
provided by Corporation.
(d) Injunctive Relief with Respect to Covenants.
(A) Consultant acknowledges and agrees that the
covenants and obligations of Consultant as set forth in this paragraph 6
relate to special, unique and extraordinary matters and are necessary in order
to preserve and protect the goodwill and proprietary rights of Corporation and
to prevent Third Parties and enterprises engaged in business and activities
which are competitive with the business and activities conducted or carried on
by Corporation from obtaining an unfair competitive advantage over
Corporation. Consultant acknowledges and agrees that any violation of any of
the terms of such covenants or obligations will cause Corporation irreparable
and continuing damage for which no adequate remedies at law exist. Therefore,
should Consultant fail to abide by any of such covenants and obligations,
Corporation shall be entitled to injunctive relief (without the requirement to
post bond therefore) and to such other further relief as may be necessary or
appropriate to cause Consultant to fully and properly comply with each of the
covenants or obligations contained in this Paragraph 6. These injunctive
remedies are cumulative and are in addition to any other rights and remedies
Corporation may have at law or in equity.
(B) In the event that any of the provisions of
Paragraph 6 are not enforceable in accordance with the terms thereof,
Corporation and Consultant agree that such provisions shall be reformed to
make such provisions enforceable in a manner that provides Corporation with
the maximum rights permitted at law.
7. Relationship of Parties. Nothing contained in this Agreement
shall authorize, empower or constitute Consultant as the agent of Corporation
in any manner; authorize or empower Consultant to assume or create any
obligation or responsibility whatsoever, expressed or implied, on behalf of or
in the name of Corporation; or authorize or empower Consultant to bind
Corporation in any manner or make any representation, warranty, covenant,
agreement or commitment on behalf of Corporation.
8. Independent Contractor. Consultant is acting as an independent
contractor, and nothing contained in this Agreement or in the relationship
between Consultant and Corporation shall be deemed to constitute a
partnership, joint venture or any other relationship, except as specifically
set forth in this Agreement.
6
9. Miscellaneous.
(a) Arbitration. All disputes, controversies or differences
that may arise between the parties out of, in relation to or in connection
with this Agreement shall be resolved by arbitration pursuant to the rules
then in effect of the American Arbitration Association, by which arbitration
each party hereto shall be bound. Each party shall promptly select an arbiter
from the approved list of arbiters provided by the American Arbitration
Association, and these two (2) arbiters shall then select a third arbiter.
Any arbitration hearing shall be held in Palm Beach County. Any award
rendered by the arbiters shall be final and binding on the parties and shall
be specifically enforceable in a court of competent jurisdiction. The
prevailing party in any such arbitration shall be entitled to the costs
associated with such arbitration, including attorneys' fees and costs.
(b) Assignment. This Agreement shall be considered unique and
personal as to the parties hereto. Therefore, neither Consultant nor
Corporation may assign all or any part of the obligations undertaken pursuant
to this Agreement without first having obtained the prior written consent of
the other party hereto.
(c) Authorization. The parties signing this Agreement represent
and warrant that they have the full authority to do so.
(d) Captions. The captions used herein are provided only as a
matter of convenience and for reference and in no way define, limit or
describe the scope of this Agreement nor the intent of any provision hereof.
(e) Counterparts. This Agreement may be executed in one (1) or
more counterparts, each of which shall be deemed an original, but all of which
shall constitute one and the same agreement.
(f) Entire Agreement. This Agreement contains the entire
agreement between the parties hereto with respect to the subject matter
hereof, and any oral or written statements or prior written notice not
specifically incorporated herein shall be of no force or effect, and no
variation, modification or change hereof shall be binding on any party hereto,
unless the same is set forth in writing and executed by the party against whom
the same is asserted.
(g) Facsimile Execution. Facsimile signatures on counterparts
of this Agreement are hereby authorized and shall be acknowledged as if such
facsimile signatures were an original execution, and this agreement shall be
deemed as executed when an executed facsimile hereof is transmitted.
(h) Governing Law. This agreement shall be construed and
interpreted in accordance with and shall be governed by the laws of the State
of Florida, without regard to principals of conflict of law and irrespective
of the fact that one or more parties hereto is now or may hereafter be a
resident of a different state, jurisdiction or country.
7
(i) No Implied Waivers. The failure of either party to require
the performance by the other party to nay provision hereof shall in no way
affect the full right to require such performance at any time thereafter. The
waiver by either party of a breach of any provision hereof shall not
constitute a waiver of any subsequent breach of the same or any other
provision, nor shall it constitute a waiver of the provision itself.
(j) Notices. All notices to be given under this Agreement shall
be in writing, and may be given, served or made by depositing the same in the
U.S. mail addressed to the party to be notified at the address herein set
forth, post-paid and registered or certified with return receipt requested, or
by recognized overnight delivery service, or by delivering the same in person
to such party:
If to Consultant: eCom xXxx.xxx, Inc.
0000 XXX Xxxxxxxxx, Xxxxx 0000
Xxxx Xxxxx Xxxxxxx, XX 00000
Facsimile: (000) 000-0000
Attn: Xxxxx Xxxxxx, President
If to Corporation: xXxxXXX.xxx, Inc.
0000 XXX Xxxxxxxxx, Xxxxx 000
Xxxx Xxxxx Xxxxxxx, XX 00000
Facsimile: (000) 000-0000
Attn: Xxxxxx Xxxxxx, President
(k) Rights in Third Parties. Except as otherwise specifically
provided for herein, nothing expressed or implied in this Agreement is
intended or shall be construed to confer upon or give any person, firm or
corporation, other than the parties hereto, any rights or remedies under or by
reason of this Agreement.
(l) Severability. In the event any one or more of the
provisions of this Agreement or the application thereof shall be invalid,
illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions hereof and any other application
thereof shall in no way be affected or impaired.
IN WITNESS WHEREOF, the parties hereto have set their hands and seals as
of the day and year first hereinabove written.
(Signatures appear next page)
8
CORPORATION:
XXXXXXX.XXX, INC., a Florida corporation
By: /s/ Xxxxxx Xxxxxx
Xxxxxx Xxxxxx, President
CONSULTANT:
ECOM XXXX.XXX, INC., a Florida corporation
By: /s/ Xxxxx Xxxxxx
Xxxxx Xxxxxx, President
9
