CONSULTING AGREEMENT
THIS AGREEMENT (the "Agreement"), is made and entered into as of this ___
day of ________________, 1997, by and between Millennium Holdings Group, Inc., a
New York Corporation with offices at 0000 Xxxxxxxxx Xxxxxxxxx, X.X., Xxxxx 000,
Xxxx Xxxxx, XX 00000 ("Millennium" or the "Consultant") and Antennas America,
Inc., a Utah Corporation with offices at 0000 Xxxx Xxxxxx, Xxxxx 000, Xxxxx
Xxxxx, XX 00000 (the "Company" or "AAI") (together the "Parties").
WHEREAS, the parties desire to formalize the terms and conditions under
which Millennium shall provide consulting services to the Company.
NOW, THEREFORE, in consideration of the mutual promises and covenants
herein contained, and other valid consideration, receipt of which is hereby
acknowledged, the Parties agree as follows:
1. Term of Agreement and Renewal.
The Agreement shall remain in effect from the date of execution hereof
through the expiration of a one year period unless earlier terminated in
accordance with Section 11 below, and may be renewed upon the mutual consent of
the Parties.
2. Nature of Services to be Rendered.
Millennium shall use its best efforts and available resources to provide
the Company with corporate and financial consulting services requested by the
Company, including but not limited to introducing the Company to broker-dealers
in order to increase interest in the Company's common stock and to establish new
market makers in the Company's common stock, disseminating to the broker-dealer
and investment community information concerning the Company and its plans and
operations in order to establish and build upon a foundation of support for the
Company, establish and manage an investor, shareholder and broker-dealer
relations program for the Company, continually monitor and update the foregoing,
and perform other corporate and financial consulting services requested by the
Company. In order to pursue the foregoing in the manner anticipated, upon the
execution of this Agreement Millennium immediately will cause at least two of
its employees to visit the Company's facilities and Millennium will familiarize
itself with the Company's plans and operations. All materials concerning the
Company that are disseminated by Consultant shall be provided to the Company
prior to their dissemination and shall not be disseminated without the prior
consent of the Company.
3. Compensation.
(a) Cash Compensation. As Compensation for its consulting services
rendered hereunder, the Company shall pay to Millennium $5,000 per month during
the term of this Agreement. The first $5,000 payment for services to be rendered
shall be due and payable upon the execution of this Agreement and payments of
$5,000 per month shall be made on the same day of each month thereafter during
the term of this Agreement.
(b) Additional Compensation; Repurchase Right. (i) During the period
commencing on the date of this Agreement and expiring one year thereafter, as
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additional Compensation for its consulting services rendered hereunder, the
Company agrees to allow Millennium to purchase the following shares (the "Option
Shares") of the Company's stock pursuant to options (the "Options") granted
pursuant to the form of Option Agreement attached to and made a part of this
Agreement as Exhibit A:
(1) 2,000,000 shares of the Company's restricted common stock at $.06 per
share.
(2) 2,000,000 shares of the Company's restricted common stock at $.10 per
share.
(3) 2,000,000 shares of the Company's restricted common stock at $.30 per
share.
(ii) Upon the occurrence of any of the events (the "Termination
Events") described in Section 11(a), (b), or (c) below, in addition to any other
rights and remedies that the Company may have, the Company shall have the right
to repurchase from Millennium all or any part of the Options and/or Option
Shares at a price (the "Repurchase Price") of $.00025 per Option or Option
Share. The Company must exercise its right to repurchase the Options and/or the
Option Shares pursuant to this Section 3(b)(ii) within 60 days following the
later to occur of the Termination Event or the Company's having knowledge of the
Termination Event. The Company may exercise this right by providing to
Millennium written notice (the "Repurchase Notice") describing the number of
Options and Option Shares to be repurchased pursuant to this Section 3(b)(ii)
together with a check in the amount of the aggregate repurchase price for those
Options and Option Shares. Upon the giving of the Repurchase Notice pursuant to
this Section 3(b)(ii), the number of Options and Option Shares to be repurchased
pursuant to this Section 3(b)(ii) immediately shall be deemed cancelled on the
Company's option and stock transfer ledgers. Immediately upon the Company's
giving of the Repurchase Notice, Millennium shall deliver to the Company
certificates representing the aggregate number of Options and Option Shares
repurchased by the Company. The certificates representing the Options and the
Option Shares shall be imprinted with a legend setting forth or referring to the
repurchase rights and restrictions of this Section 3(b)(ii), which legend shall
be removed by the Company upon the request of Millennium following the
expiration of the Company's repurchase rights pursuant to this Section 3(b)(ii).
(c) Registration Rights.
(1) The Company will, no later than 60 days after the date (the
"Effective Date") of this Agreement, file with the Securities And Exchange
Commission (the "SEC") a registration statement under the Securities Act
of 1933, as amended (the "1933 Act"), covering the sale in the open market
by the Consultant of the Option Shares issuable upon the exercise of the
Options by the Consultant. The Company will undertake due diligence to
cause the registration statement to become effective with the SEC as soon
as possible after its filing.
(2) As to any registration statement, the Company's obligations
contained in this Section 3(c) shall be conditioned upon timely receipt by
the Company in writing of information as to the terms of the contemplated
transfer to be registered furnished by and on behalf of the Consultant,
and such other information as the Company reasonably may require from the
Consultant or any underwriter for any Option Shares for inclusion in the
registration statement. Such information shall be provided to the Company
in writing within 10 days after the request for that information by the
Company.
(3) All registration expenses incurred by the Company in connection
with any registration, qualification or compliance pursuant to this
Section 3(c), including reasonable printing expenses, fees and
disbursements of the Company's counsel, and registration and filing fees
relating to Option to be registered on behalf of the Company pursuant to
any registration statement required to be filed by the Company on behalf
of the Consultant pursuant to this Section 3(c), shall be borne by the
Company. All selling expenses, including commissions, allocable to the
sale of the shares of the Company Stock registered on behalf of the
Consultant shall be borne by the Consultant.
(4) In the case of a registration, qualification or compliance
effected by the Company on behalf of the Consultant pursuant to this
Section 3(c), the Company shall keep the Consultant advised in writing as
to the initiation of such registration, qualification, and compliance and
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as to the completion thereof. At its expense, the Company will keep such
registration, qualification or compliance effective for a period of one
year after the Effective Date or until the Consultant has completed the
distribution described in the registration statement relating thereto,
whichever first occurs.
(5) In the case of a registration, qualification or compliance
effected by the Company on behalf of the Consultant pursuant to this
Section 3(c), the Company shall take such action as may be reasonably
necessary to register or qualify the sale by the Consultant of Options
under the securities acts or blue sky laws of such jurisdictions as the
Consultant may reasonably request and to do any and all other acts and
things which may be necessary or advisable to enable the Consultant to
complete such proposed sale or other distribution by the Consultant of
Option Shares in any such jurisdiction; provided however, that in no event
shall the Company be obligated to register or qualify under the blue sky
laws of any state in which the Common Stock of the Company currently is
not qualified for resale, or be obligated to register or qualify the
securities in any jurisdiction which would require the Company to qualify
to do business or to file a general consent to service of process in any
jurisdiction where it shall not then be qualified.
(6) The Company will indemnify and hold harmless the Consultant
against any loss, claim, damage or liability (or action in respect
thereof) to which the Consultant may become subject, under the 1933 Act,
or otherwise, insofar as any such loss, claim, damage or liability (or
action in respect thereof) is caused by any untrue statement or alleged
untrue statement of any material facts contained in the registration
statement, any prospectus contained in the registration statement, or any
amendment or supplement thereto, or arises out of or is based upon the
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements made therein not
misleading. Notwithstanding the foregoing provisions of this paragraph,
the Company will not be liable in any such case to the extent that any
such loss, claim, damage, expense or liability arises out of or is based
upon an untrue statement or alleged untrue statement or omission or
alleged omission so made in conformity with information furnished by the
Consultant or any agent or other representative of the Consultant.
(7) The Consultant will indemnify and hold harmless the Company and
any underwriter (as defined in the 0000 Xxx) for the Company and each
person, if any, who controls the Company or such underwriter against any
loss, claim, damage or liability (or action in respect thereof) to which
the Company or such underwriter or controlling person may become subject,
under the 1933 Act or otherwise, insofar as any such loss, claim, damage
or liability (or action in respect thereof) is caused by any untrue
statement or alleged untrue statement or omission or alleged omission made
in conformity with information furnished by the Consultant or any agent or
other representative of the Consultant or other representative of the
Consultant for use in the registration statement.
4. Warranties and Representations of the Consultant.
In order to induce the Company to enter into this Agreement, the
Consultant hereby makes the following unconditional warranties and
representations:
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(a) In connection with its execution of and performance under this
Agreement, the Consultant has not taken and will not take any action which would
cause it to become required to make any filings with or to register in any
capacity with the Securities and Exchange Commission (the "SEC"), the National
Association of Security Dealers, Inc. (the "NASD"), the securities commissioner
or department of any state, or any other regulatory or governmental body or
agency.
(b) Neither the Consultant nor any of its principals is subject to any
sanction or restriction imposed by the SEC, the NASD, any state securities
commission or department, or any other regulatory or governmental body or
agency, which would prohibit, limit or curtail the Consultant's execution of
this Agreement or the performance of its obligations hereunder.
(c) The Consultant will take no action causing it to be a "promoter"
pursuant to the 1933 Act or that would require disclosure in SEC filings,
without the Company's prior written consent.
(d) Millennium is not now a party to a consulting agreement with any other
corporation or entity involved in a business which is the same as or similar to
the Company's.
5. Warranties and Representations of the Company.
In order to induce the Consultant to enter into this Agreement, the
Company hereby makes the following unconditional warranties and representations:
(a) The Company is not subject to any restriction imposed by the SEC or by
operation of the 1933 Act, the Exchange Act of 1934, as amended (the "1934
Act"), or any of the rules and regulations promulgated under the 1933 Act or the
1934 Act which would prohibit its execution of this Agreement or the performance
of its obligations to the Consultant herein set forth.
(b) The Company has not been sanctioned by the SEC or any state securities
commissioner or department in connection with any issuance of its securities.
(c) The Company is not a party to any other contract or agreement with
terms similar to those contained herein.
(d) All payments required to be made to Millennium hereunder will be made
on time and in accordance with the payment terms and conditions set forth
herein.
(e) The Company acknowledges that Millennium does not guarantee its
ability to cause the consummation of any contract or merger or acquisition with
any corporate candidate.
6. Representations And Warranties Of Consultant Concerning The Options And
Option Shares.
For purposes of this Agreement, the Options and the Option Shares are
referred to collectively as the "Consultant Securities". Consultant hereby
represents and warrants, and, upon exercise of the Options, Consultant shall be
deemed to have represented and warranted, to the Company as follows concerning
Consultant's respective acquisition of the Options, and the Option Shares
issuable upon exercise of the Options:
(a) Consultant is acquiring the Consultant Securities for
investment purposes only and the Consultant Securities that Consultant is or
will be acquiring will be held by Consultant without sale, transfer or other
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disposition for an indefinite period unless the transfer of those securities is
subsequently registered under the federal securities laws or unless exemptions
from registration are available;
(b) Consultant's overall commitment to investments that are
not readily marketable is not disproportionate to Consultant's net worth and
Consultant's investment in the Consultant Securities will not cause such
overall commitments to become excessive;
(c) Consultant's financial condition is such that Consultant
is under no present or contemplated future need to dispose of any portion of
the Consultant Securities to satisfy any existing or contemplated undertaking,
need or indebtedness;
(d) Consultant has sufficient knowledge and experience in
business and financial matters to evaluate, and Consultant has evaluated, the
merits and risks of an investment in the Consultant Securities.
(e) The address set forth above is Consultant's true and correct
residence, and Consultant has no present intention of becoming a resident of
any other state or jurisdiction.
(f) Consultant confirms that all documents, records and books
pertaining to an investment in the Consultant Securities have been made
available or delivered to Consultant. Without limiting the foregoing,
Consultant has received and reviewed the Company's Annual Report on Form 10-KSB
for the year ended December 31, 1996 and Quarterly Reports on Form 10-QSB for
each of the quarters ended March 31, 1997 and June 30, 1997, and each of the
Company's Press Releases since December 31, 1996, and Consultant has had the
opportunity to discuss the acquisition of the Options and the Option Shares
with the Company, and Consultant has obtained or been given access to all
information concerning the Company that Consultant has requested.
(g) Consultant has had the opportunity to ask questions of, and
receive the answers from, the Company concerning the terms of the investment in
the Consultant Securities and to receive additional information necessary to
verify the accuracy of the information delivered to Consultant, to the extent
that the Company possesses such information or can acquire it without
unreasonable effort or expense.
(h) Consultant understands that the Options have not, and the Option
Shares issuable upon exercise of the Options will not be, registered under the
1933 Act or any state securities laws in reliance on an exemption for private
offerings, and no federal or state agency has made any finding or determination
as to the fairness of this investment or any recommendation or endorsement of
the sale of the Consultant Securities.
(i) The Consultant Securities that Consultant is or will be
acquiring will be solely for Consultant's own account, for investment, and are
not being purchased, and will not be purchased, with a view to or for the
resale, distribution, subdivision or fractionalization thereof. Consultant has
no agreement or arrangement for any such resale, distribution, subdivision or
fractionalization thereof.
(j) Consultant acknowledges and is aware of the following:
(i) The Consultant Securities constitute a speculative
investment and involve a high degree of risk of loss by Consultant of
Consultant's total investment in the Consultant Securities.
(ii) There are substantial restrictions on the transferability
of the Consultant Securities. The Consultant Securities cannot be
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transferred, pledged, hypothecated, sold or otherwise disposed of unless
they are registered under the 1933 Act or an exemption from such
registration is available and established to the satisfaction of the
Company; investors in the Company have no rights to require that the
Consultant Securities be registered except as set forth in Section 3(c) of
this Agreement; there is no right of presentment of the Consultant
Securities and there is no obligation by the Company to repurchase any of
the Consultant Securities; and, accordingly, Consultant may have to hold
the Consultant Securities indefinitely and it may not be possible for
Consultant to liquidate Consultant's investment in the Company.
(iii) Each certificate issued representing the Consultant
Securities shall be imprinted with a legend that sets forth a description
of the restrictions on transferability of those securities, which legend
will read substantially as follows:
"The securities represented by this Certificate have not
been registered or qualified under federal or state securities laws.
These securities may not be offered for sale, sold, pledged, or
otherwise disposed of unless so registered or qualified or unless an
exemption exists, the availability of which is to be established by
an opinion of counsel (which opinion and counsel shall both be
reasonably satisfactory to the Company)."
(iv) Each certificate or other document issued representing the
Options and the Option Shares shall be imprinted with, in addition to the
legend set forth in Section 6(j)(iii), a legend describing the Company's
right to repurchase the Options and the Option Shares pursuant to Section
3(b)(ii) of this Agreement, which legend will read substantially as
follows:
"The securities represented by this document are subject to
the right of the Company to repurchase these securities pursuant to
the Consulting Agreement effective as of October __, 1997 between
Millennium Holdings Group, Inc. and the Company."
The foregoing representations and warranties are true and accurate as of
the date hereof and shall survive delivery of this signed Agreement and any of
the Consultant Securities.
7. Waiver of Registration Obligations.
In the event of NASD-registered broker-dealer shall execute a letter of
intent to conduct a firm commitment underwriting of the Company's securities,
with anticipated gross proceeds of at least $1,000,000 and shall require that
all of the Company's shareholders waive registration rights, Millennium will
provide a written waiver of its registration right herein provided.
8. Expense Reimbursement.
Millennium shall be entitled to receive cash reimbursement, and the
Company shall provide cash reimbursement, of all reasonable cash out-of-pocket
expenses paid by Millennium on behalf of the Company in performance of its
duties hereunder. Such expenses shall include without limitation expenses for
communications, deliveries and travel. In no event, however, will Millennium
incur on behalf of the Company an expense or aggregate expenses in excess of
$100 without the prior written consent of the Company. Millennium shall provide
the Company with a monthly statement of such expenses and the Company agrees to
pay such pre-approved expenses within 30 days of receipt by the Company of the
statement of expenses.
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9. Indemnification of Millennium by the Company.
The Company shall indemnify and hold harmless Millennium and its
principals from and against any and all liabilities and damages in connection
with the Company's ownership and operation and, without limiting the foregoing,
shall pay the Consultant's legal fees and expenses if the Company is named as a
defendant in any proceedings brought in connection with the Company except if
such liabilities or damages are the result of the negligence or willful
misconduct of Consultant or its principals, agents, or representatives.
10. Indemnification of the Company by the Consultant.
Millennium shall indemnify and hold harmless the Company and its
principals from and against any and all liabilities and damages arising out of
actions taken by Millennium in connection with its services as a consultant,
which actions were not authorized by the Company, and, without limiting the
foregoing, shall pay the Company's legal fees and expenses if the Company is
named as a defendant in any proceedings brought in connection with the
Consultant.
11. Termination And Breach.
This Agreement shall be effective as of the date hereof when executed by
Consultant and AAI, and shall be for a term as defined in Section 1 of this
Agreement. AAI may terminate this Agreement immediately by delivering to
Millennium written notice of such termination in the event of the occurrence of
any of the following:
(a) Millennium or its principals are sanctioned by the SEC, NASD, or state
or federal securities or blue sky divisions for securities violations where it
can be determined that such sanction reasonably prohibits Millennium from
performing its duties hereunder;
(b) A material breach of any provision of this Agreement by Millennium;
(c) Millennium is not acting in a responsible manner with respect to its
activities as a financial consultant to AAI.
12. Arbitration.
Any and all conflicts, disputes and disagreements arising out of or in
connection with any aspect of the Agreement shall be subject to arbitration in
accordance with the rules of The American Arbitration Association then in
effect. Written Notice of Dispute shall be served by either Party upon the other
Party at its address set forth herein or such other address as it shall have
provided in writing for that purpose, and the arbitration date shall be set no
later than two months from the date such Notice is served. The dispute shall be
submitted to The American Arbitration Association in Denver, Colorado. The
Parties designate Jefferson County Court in Jefferson County, Colorado as the
court in which any arbitration award shall be subject to confirmation, and will
abide by such confirmation.
13. Entire Understanding/Incorporation of Other Documents.
This Agreement and the Exhibit hereto contain the entire understanding of
the Parties with regard to the subject matter hereof, superseding any and all
prior agreements or understandings whether oral or written, and no further or
additional agreements, promises, representations or covenants may be inferred or
construed to exist between the Parties.
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14. No Assignment or Delegation Without Prior Approval.
No portion of the Agreement or any of its provisions may be assigned, nor
obligations delegated, to any other person or party without the prior written
consent of the Parties except by operation of law or as otherwise set forth
herein.
15. Survival Agreement.
The Agreement and all of its terms shall inure to the benefit of any
permitted assignees of or lawful successors to either Party.
16. No Amendment Except in Writing.
Neither the Agreement nor any of its provisions may be altered or amended
except in a dated writing signed by the Parties.
17. Waiver of Breach.
No waiver of any breach of any provision hereof shall be deemed to
constitute a continuing waiver or a waiver of any other portion of the
Agreement.
18. Severability of the Agreements.
Except as otherwise provided herein, if any provision hereof is deemed by
arbitration or a court of competent jurisdiction to be legally unenforceable or
void, such provision shall be stricken from the Agreement and the remainder
hereof shall remain in full force and effect.
19. Governing Law.
The Agreement and its provisions shall be construed in accordance with and
pursuant to, and governed by, the laws of the State of Colorado, as applicable
to agreements to be performed solely within the State of Colorado, without
regard to its conflict-of-laws provisions then in effect.
20. No Construction Against Drafter.
The Agreement shall be construed without regard to any presumption or
other rule requiring construction against the Party causing the drafting hereof.
IN WITNESS WHEREOF, the Parties have executed the Agreement as of the date
first above written.
ANTENNAS AMERICA, INC. MILLENNIUM HOLDINGS GROUP, INC.
By:/s/ Xxxxxxx X. Max By:/s/ Xxxx Schulthers
-------------------------------- -----------------------
Xxxxxxx X. Xxxx, Chief Executive Xxxx Xxxxxxxxxx, President
Officer
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