EXHIBIT 10.7
CONSULTING AGREEMENT
AGREEMENT made effective the 1st day of February, 1996, between NATIONAL
FIBER NETWORK, INC., a Delaware corporation, with executive offices at ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ (hereinafter referred to as the "Corporation"),
and REALPROP CAPITAL CORPORATION, a Florida corporation with offices at ▇▇▇
▇. ▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ (hereinafter referred to as "Consultant").
W I T N E S S E T H :
WHEREAS, the Corporation is desirous of engaging the services of the
Consultant in the capacity hereinafter stated, and the Consultant is desirous
of acting as a consultant to the Corporation in such capacity for the period
and on the terms and conditions set forth herein;
WHEREAS, the services of the Consultant are unique, extraordinary and
not readily replaceable due to its expertise and knowledge of the business
and operations of the Corporation and its position in the business community;
NOW, THEREFORE, in consideration of the mutual covenants and conditions
herein contained, the parties hereto do hereby agree as follows:
1 Consulting Services. The Corporation hereby engages Consultant as
an independent contractor, and not as an employee, partner, joint venturer or
agent, to provide consulting services to the Corporation and Consultant
accepts such engagement and agrees to provide to the Corporation the
consulting services described herein, faithfully and to the best of
Consultant's ability.
2 Term of Employment. The term of this Agreement shall become
effective upon execution of this Agreement and shall end five (5) years
thereafter.
3 Duties. Consultant agrees to provide the services of its employee,
▇▇▇▇▇▇ ▇▇▇▇, who agrees to devote as much time per month to the business and
affairs of the Corporation as he shall deem to be reasonably necessary to
effectively provide the Corporation with information concerning its knowledge
and understanding of (i) transactions, and (ii) conduct of the business in
which the Corporation engaged prior to the date hereof, and such other areas
of consultation as Consultant and the Corporation may mutually agree upon.
4 Compensation and Benefits.
4.1 In consideration for all the Services to be performed by
Consultant, the Corporation shall pay to Consultant a fee of Ninety
Thousand Dollars ($90,000.00) per year, payable in equal monthly
installments commencing on June 15, 1996, and continuing on the same day
of each and every consecutive month thereafter for a period of sixty (60)
months.
4.2 In order to secure the obligations of Corporation to
Consultant, the Corporation shall use its best efforts to have its wholly
owned subsidiary, National Fiber Network of New Jersey, Inc., execute the
certain Guaranty, a copy of which is attached hereto as Exhibit "A".
Said Guaranty shall be further secured by a security interest in all of
the assets of National Fiber Network of New Jersey, Inc., in the form as
set forth in the attached Exhibit "B".
4.3 To further secure the obligations of Corporation to Consultant,
the Corporation shall use its best efforts to have ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
execute the
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attached Guaranty and Stock Pledge and Escrow Agreement pledge his 410,000
shares of the Corporation in the form set forth in Exhibit "C".
4.4 National Fiber Network of New Jersey, Inc., and ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ are sometimes hereafter referred to together as the "Guarantor".
5 Expenses.
5.1 The Corporation agrees to pay or reimburse Consultant for all
pre-approved reasonable, ordinary and necessary business expenses
incurred by Consultant in connection with the business of the
Corporation, including expenditures for pre-approved business travel. In
such regard, Consultant agrees to submit such vouchers and other proof of
payment as the Corporation may require from time to time to support these
expenses as business expenses for Internal Revenue Service purposes.
5.2 The Corporation further agrees to pay or reimburse Consultant
for all rental payments due on Consultants' office located at ▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, payments ▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇, for the period commencing
with the January, 1996 rental payment and ending with, but including, the
June, 1997, rental payment in the amount of $3,505. per month. The
rental for January, February and March 1996 shall be paid on or before
June 15, 1996, with interest, from the date of each such rental payment
at the rate of twelve (12%) percent per annum. Commencing on April 1,
1996, the Corporation shall pay or reimburse Consultant for each month's
rent on or before the fifth (5th) day of each month.
6 Disclosure of Information. Consultant shall not, either during the
term of this Agreement or at any time thereafter, use for its own benefit, or
for the benefit
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of any other person, corporation, partnership or other entity, or to the
detriment of the Corporation, or disclose to any person, corporation,
partnership or other entity, any secret, private or confidential information
or other proprietary knowledge of and concerning the business or affairs of
the Corporation which Consultant may have acquired in the course of, or as
incident to, performing its consulting Services for the Corporation or
otherwise (including, but not limited to, past, present or prospective
clients, customers, associates and consultants or otherwise).
7 Default and Remedies upon Default.
7.1 A default shall exist under the terms of this Agreement in the
event that
7.1.1 Corporation fails to pay to Consultant, on the due date
thereof, all compensation due and payable to Consultant and all
expenses payable to Consultant under paragraphs 4 and 5
respectively, above;
7.1.2 a default shall occur in the obligations of Corporation
and/or Guarantor under the terms of that certain Security Agreement
and that certain Stock Pledge and Escrow Agreement referenced in
Paragraph 4, above;
7.1.3 a default shall occur in the payment by Corporation to
Consultant pursuant to terms of that certain Promissory Note of even
date herewith, a copy of which is attached hereto as Exhibit "D";
7.1.4 a default by the Corporation of its obligations as more
particularly set forth in that certain letter Agreement of even date
herewith by and among Corporation, Consultant and ▇▇▇▇▇▇ ▇▇▇▇.
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7.2 In the event of a default as set forth in Paragraph 7.1, above,
and failure of Corporation to cure within ten (10) days of written notice
thereof.
7.2.1 all compensation to be paid by Corporation to Consultant
pursuant to Paragraph 4, above, shall be accelerated and shall
immediately become due and payable;
7.2.2 all sums due and owing to Consultant pursuant to
Paragraph 5, above, shall be accelerated and shall immediately
become due and payable;
7.2.3 all other sums payable to Consultant by Corporation or by
Guarantor shall be accelerated and shall become immediately due and
payable notwithstanding the terms that may be contained in the small
documents evidencing such obligations;
7.2.4 all sums payable to Consultant shall bear interest at the
rate of eighteen percent (18%) per annum from the date of default
until paid in full.
8 Independent Contractor Status Affidavit. Consultant agrees to
execute and deliver to the Corporation, simultaneously with the execution of
this Agreement, the Independent Contractor Status Affidavit in the form set
forth in Exhibit "D".
9 Release of Security for Guarantees. Upon the Corporation's completion
of a proposed IPO for raising no less than Two Million ($2,000,000.00) Dollars,
Consultant agrees to release its lien on the assets of National Fiber Network of
New Jersey, Inc. described in paragraph 4.2 above and all guaranties in
connection therewith; provided, however, that Corporation will, at the time of
such release,
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prepay the last Ninety Thousand ($90,000.00) Dollars due to Consultant
pursuant thereto, and further provided that Corporation is not otherwise in
default hereunder.
10 Other Obligations of Consultant. Consultant shall also comply with
all obligations of ▇▇▇▇▇▇ ▇▇▇▇ under that certain letter agreement between
him and the Corporation.
11 Notices. Any notice required or permitted to be given under this
Agreement shall be in writing and (i) hand delivered, (ii) sent by overnight
courier requiring signature for delivery or (iii) sent by registered or
certified mail to the Corporation or Consultant at the address set forth in
this Agreement or to any other address of which notice of the change is given
to the parties hereto.
12 Assignment. The rights and obligations of the Corporation under
this Agreement are assignable and shall inure to the benefit of and shall be
binding upon any successor and assignee of the Corporation; however,
Consultant's rights and obligations under this Agreement are personal in
nature and may not be assigned.
13 Attorney's Fees. In the event of a dispute between Consultant and
Corporation or between Consultant and Guarantor, the prevailing party shall
be entitled to an award of all attorney's fees and costs incurred in said
dispute through and including trial and all appeals.
14 Modification. This Agreement shall not be changed, modified or
amended in any respect except by a written instrument signed by both parties.
15 Choice of Law. This Agreement shall be governed, interpreted and
construed by the applicable laws of the State of New York.
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16 Entire Understanding. This Agreement constitutes the entire
understanding and agreement between the Corporation and Consultant.
IN WITNESS WHEREOF, this Agreement has been executed by the parties on the
day and year first above written.
WITNESSES: CORPORATION:
NATIONAL FIBER NETWORK,
______________________ By:_________________________
______________________
CONSULTANT:
REALPROP CAPITAL CORPORATION
______________________ By:_________________________
______________________
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