1
Exhibit 10D
Consulting Agreement with Mr. Xxx Xxxxx
34
2
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT is made and entered into effective as of the
29th day of February, 2000 between SEYCHELLE ENVIRONMENTAL TECHNOLOGIES, INC., a
Nevada corporation (the "Company"), and MR. XXX XXXXX (the "Consultant"), with
reference to the following facts:
A. The Consultant is an internationally acclaimed performer who
possesses creativity, business contacts and initiative, and whose endorsement of
the Company's products is expected to assist in the development and growth of
the Company and its products.
B. The Company is an innovative leader in the field of water
filtration, with a strong commitment to the development and use of proprietary
water filtration technology to eliminate disease and suffering resulting from
water-borne illnesses throughout the world.
C. The Company believes that the future growth, profitability and
success of the Company's business will be advanced by the engagement of the
Consultant as a spokesperson for the Company. The Company desires, therefore, to
secure for the Company and its affiliates the benefit of the Consultant's
reputation, experience and ability on the terms set forth herein.
NOW, THEREFORE, on the basis of the foregoing facts and in
consideration of the mutual covenants and agreements contained herein, the
parties hereto agree as follows:
1. Consulting Engagement
The Company hereby agrees to engage the Consultant and the Consultant
hereby accepts an engagement to act as a spokesperson for the Company and
endorse the products of the Company, on the terms and subject to the conditions
hereinafter set forth in this Consulting Agreement (hereinafter the
"Agreement").
2. Term
(a) Subject to the provisions and conditions of this Agreement, the
term of this Agreement shall commence on the effective date of this Agreement,
and shall continue through December 31, 2002 (referred to herein as the "Initial
Term"), provided that the term of this Agreement shall be subject to
extension(s) pursuant to the provisions of this Section 2 and to earlier
termination pursuant to Section 6 herein (which defines terminating events).
(b) On or before January 1, 2002, and on each January 1 thereafter, the
Board of Directors of the Company (the "Board") shall review this Agreement and
the Consultant's performance hereunder and shall determine whether to extend the
term of this Agreement for an additional calendar
35
3
year, thereby extending the remaining term of this Agreement to two (2) calendar
years. For purposes of this Agreement, a reference to an "extension date" shall
pertain to any such January 1 as of which this Agreement is extended to an
additional calendar year under the provisions hereof, and a reference to the
"term" of this Agreement shall be inclusive of the Initial Term and any
extension(s) under the operation of this Section. In the event of any
extension(s) hereunder all provisions and conditions of this Agreement shall
remain in effect.
3. Duties of Consultant
(a) Subject to the provisions and conditions contained herein, the
Company hereby engages the Consultant and the Consultant hereby agrees to render
services to the Company as a spokesperson for the Company, pursuant to which
Consultant agrees to make mutually agreed upon appearances and participate in
the development of marketing materials including, without limitation,
endorsements by Consultant of such of the Company's products as the parties
mutually select.
(b) The Consultant agrees that during the term hereof he shall devote
such time to the business of the Company as the parties shall mutually agree,
provided that Consultant agrees to make himself available, at reasonable times
and places, to participate in marketing and similar activities on the Company's
behalf for not more than twelve business days and not less than twelve business
days per year. The parties expressly acknowledge and agree that in light of
Consultant's busy work schedule, the dates and times for all time devoted by
Consultant shall be subject to his availability and prior approval. The
Consultant agrees that except as the parties may otherwise agree in writing,
during the term of this Agreement he will not, directly or indirectly, provide
services on behalf of any competitive company a material part of the business of
which involves the manufacture or distribution of water purification products,
or on behalf of any subsidiary or affiliate of any such competitive entity, as
an employee, consultant, independent contractor, agent, spokesperson, sole
proprietor, partner, joint venturer, corporate officer or director; nor shall
the Consultant acquire by reason of purchase during the term of this Agreement
the ownership of more than 1% of the outstanding equity interest in any such
competitive entity. Nothing herein is intended to restrict the right of
Consultant to invest in or act as a spokesman for any company if by doing so
Consultant can in no way be perceived as supporting or endorsing a competing
water purification product or as supporting or endorsing any company or
affiliate of a company selling or manufacturing any competing water purification
product.
(c) Consultant 's relationship to the Company shall be that of an
independent contractor to the Company and not that of an agent, employee or
other representative of the Company.
(d) During and after the term of this Agreement, the Consultant shall
not disclose to any person (other than an employee or agent of the Company or
any affiliate entitled to receive the same) any confidential information
relating to the business of the Company or any affiliate and obtained by him
while providing services to the Company, without the consent of the Board, or
until such information ceases to be confidential. The term "confidential
information" as used herein shall include any information provided by either
party which is not contained in marketing or publicity
36
4
materials or otherwise available to the public, and which was not previously
obtained by the other party from other sources. Confidential information shall
include, but not be limited to, any information with respect to the business of
the Company, its products, services, marketing plans, research and development.
Confidential information may be physically manifested in any form, including,
but not limited to, oral and written communications, documents, drawings, films,
photographs or magnetic storage. Notwithstanding the foregoing, the Consultant
shall not be precluded from disclosures respecting the Company where made
pursuant to compulsory legal process or when otherwise required by an
appropriate government agency, or to Consultant's attorneys as a confidential
communication and to the extent necessary to protect Consultant's interests.
4. Compensation
(a) As compensation for the performance of Consultant's services
hereunder the Company shall pay to the Consultant a commission equal to 2.5% of
the gross revenue derived by the Company from sales of the Company's products in
which Consultant directly participated. Consultant's commission on each calendar
month's gross revenue shall be due and payable thirty (30) days following the
end of such calendar month. For purposes of this Agreement the Consultant shall
be deemed to have directly participated in all sales to those entities and
individuals introduced to the Company by Consultant, as listed on Exhibit "A"
attached hereto and incorporated herein by reference, and in all sales produced
by specific marketing programs in which Consultant directly participates and/or
for which Consultant participates in the production of specific marketing
materials. The Consultant shall not be deemed to have directly participated in a
sale solely by virtue of the Company's use of the general marketing materials
produced by and for the Company with the assistance and/or participation of
Consultant.
(b) In addition, in consideration for the Consultant's agreement to
serve as the official and principal spokesman of the Company for such of the
Company's products and services as the parties hereto may agree from time to
time, and in consideration for the Consultant's assistance and participation in
the production of general marketing materials for use by the Company, the
Company agrees to issue to or for the benefit of Consultant 110,000 restricted
shares of common stock of the Company, fully paid and non-assessable.
(c) For purposes of this Agreement "gross revenues" shall mean the
total gross receipts of all merchandise sold by the Company and its affiliates,
wholesale or retail, domestic or foreign, cash, credit, or otherwise, including
the value of all consideration other than money received therefor, without
reserve or deduction for inability or failure to collect (except as otherwise
provided for herein). Deposits accepted by the Company shall not be included in
gross revenue unless and until the proposed sale with respect to which the
deposit is received is completed. Each installment or credit sale shall be
treated as a sale includible in gross revenue when and as the Company receives
payment therefor. Excluded from gross revenue are: (i) any returns; (ii) cash or
credit refunds to customers on transactions to the extent previously included in
gross revenue; (iii) sales or fixtures and equipment, which are not stock for
sale or trade, after use in the Company's business; (iv) amounts added to the
selling price of goods and/or services, collected from customers, and paid by
37
5
the Company to the appropriate governmental authority for any sales or excise
tax; (v) sales to employees, not to exceed Five Thousand Dollars ($5,000.00) in
any single calendar year; (vi) discounts, promotional items or "give-aways;" and
(vii) bad checks and/or debt (to the extent previously included in gross
revenue) not to exceed a total of five percent (5%) of the Company's gross
revenue in any single calendar year and provided that if subsequently collected,
said checks and/or debts shall be included within gross revenue in the calendar
year in which subsequently collected.
5. Expenses
Subject to compliance with the Company's normal and customary policies
regarding substantiation, verification and pre-approval of business expenses,
the Consultant is authorized to incur on behalf of the Company, and the Company
shall directly pay or shall fully reimburse the Consultant for, all customary
and reasonable expenses incurred for promoting, pursuing or otherwise furthering
the business of the Company or its affiliates, including, without limitation,
reasonable travel expenses, lodging, and business related meals and meals while
traveling.
6. Termination
(a) Terminating Events. This Agreement may be terminated or suspended
prior to the expiration of its term in accordance with the following:
(i) Death. This Agreement shall terminate upon the Consultant's
death.
(ii) Disability. In the event that the Consultant becomes
disabled within the meaning of Section 22(e)(3) of the
Internal Revenue Code of 1986, as amended, this Agreement
shall terminate on the date upon which the Consultant is
determined to be disabled unless the Consultant resumes the
performance of substantially all of his duties under this
Agreement within 180 days thereafter.
(iii) Cause. This Agreement shall be subject to termination by the
Board for cause, which for purposes of this Agreement shall
mean a termination on the grounds of the Consultant's
personal dishonesty, incompetence, willful misconduct,
breach of fiduciary duty involving personal profit,
intentional failure to perform the stated duties under this
Agreement or willful violation of any law, rule or
regulation (other than traffic violations or similar
offenses), or in the event of a material breach by the
Consultant of any provision of this Agreement. For purposes
of this Agreement, the Consultant shall not be deemed to
have been terminated for cause unless and until there shall
have been delivered to the Consultant a written notice
informing the Consultant that he has been found guilty of
misconduct of the type described in this Section 6(a)(iii)
and specifying the particulars thereof in detail, and, in
the case of misconduct that can be cured, the Consultant
shall have failed to cure the same within a reasonable
period of time thereafter.
38
6
(b) Compensation and Benefits Payable By the Company Upon Termination.
Compensation shall be payable by the Company upon a termination of this
Agreement in accordance with the following:
(i) Upon the expiration of the term of this Agreement or in the
event of a termination of this Agreement under Sections
6(a)(ii)(due to disability), the Consultant shall be
entitled to continue to receive the commission income
specified in Section 4(a) herein until his death, provided
that the Company shall not be obligated to disburse any such
commissions to Consultant unless and until the accrued
commissions subject to disbursement equal or exceed $500.
(ii) In the event of a termination of this Agreement under
Section 6(a)(i) or (iii) (due to the death of Consultant or
a termination of the Consultant for cause), or in the event
of Consultant's death following the termination of this
Agreement, the Company's obligation to provide the
commission income specified in Section 4(a) herein shall
terminate as of the date of such death or termination,
provided that all then accrued and unpaid commissions shall
be unaffected and shall remain and/or become due and payable
in accordance with the terms of this Agreement
notwithstanding such death or termination.
7. Definition of "Affiliate"
The term "affiliate", as used in this Agreement, shall mean any person,
firm, corporation, association, organization, or unincorporated trade or
business that, now or hereinafter, directly or indirectly, controls, is
controlled by, or is under common control with the Company, including without
limitation, any subsidiary of the Company.
8. Nonassignment
(a) The obligations and duties of the Consultant under this Agreement
are personal and not assignable. This Agreement shall inure to the benefit of
and shall be binding upon the Company, its successors and its assigns. As used
in this Agreement, the term "successor" shall include any firm, corporation or
other business entity which at any time, whether by merger, consolidation,
conversion or other corporate reorganization involving the Company, acquires all
or substantially all of the assets or business of the Company. This Agreement
may not be assigned by the Company without the prior written consent of the
Consultant.
(b) Neither the Consultant nor his wife or his estate shall have any
right to alienate, pledge, hypothecate, encumber or dispose of the right to
receive payments under this Agreement, nor shall such payments be subject to
pledge, attachment or claims of creditors. Such payments and the rights thereto
are expressly declared to be nonassignable and nontransferable. In the event of
any attempted assignment or transfer, the Company shall not be bound thereby and
shall be relieved of
39
7
its liability under this Agreement by making payments in accordance with this
Agreement to the parties designated to receive payments under this Agreement.
9. Successors
This Agreement and all rights of the Consultant hereunder shall inure
to the benefit of and be enforceable by the Consultant's personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devises and legatees. If the Consultant should die while any amounts are payable
to him hereunder, all amounts payable hereunder shall be paid in accordance with
the terms of this Agreement to the Consultant's estate, unless the Consultant
has provided written notice to the Company specifying a different beneficiary or
beneficiaries (which notices may be changed from time to time at the option of
the Consultant, subject to the consent of the Consultant's spouse if his spouse
then has an enforceable interest in such benefits).
10. Waiver And Modification
Any waiver, alteration or modification of any of the terms of this
Agreement shall be valid only if made in writing and signed by the parties
hereto. No waiver by either of the parties hereto of their rights hereunder
shall be deemed to constitute a waiver with respect to any subsequent
occurrences or transaction hereunder unless such waiver specifically states that
it is to be construed as a continuing waiver.
11. Indemnification
The Company will indemnify, defend and hold harmless Consultant against
any and all loss, liability, claims, damage and expense, including attorneys
fees, arising out of any services, representations or actions undertaken by
Consultant on behalf of the Company, including any activities or representations
of Consultant as the principal spokesperson for the Company and its products,
and in connection with any advertising, promotion, infomercial or any other
written, visual or audio materials for which Consultant performs any services on
behalf of the Company. Consultant shall give the Company prompt notice of any
claim made or action commenced against him.
12. Governing Law; Severability
This Agreement shall be governed by and construed in accordance with
the laws of California. Any provision of this Agreement which is prohibited or
unenforceable shall be ineffective only to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof.
40
8
13. Arbitration
Any action to enforce or interpret this Agreement, or to resolve
disputes with respect to this Agreement shall be submitted for arbitration in
accordance with Commercial Arbitration Rules of the American Arbitration
Association and shall be heard by the American Arbitration Association in Los
Angeles, California. Arbitration shall be the exclusive dispute resolution
process used by the parties hereto. Any party may commence arbitration by
sending a written demand for arbitration to the other parties. Such demand shall
set forth the nature of the matter to be resolved by arbitration. The
substantive law of the State of California shall be applied by the arbitrator to
the resolution of the dispute. The parties shall share equally all initial costs
of arbitration. The prevailing party shall be entitled to reimbursement of
attorney fees, costs, and expenses incurred in connection with the arbitration
and any judicial determinations relating thereto, including but not limited to
motions to confirm and appeals with respect to such judicial determinations. All
decisions of the arbitrator shall be final, binding, and conclusive on all
parties. Judgment may be entered on any such decision in accordance with
applicable law in any court having jurisdiction thereof. The arbitrator (if
permitted under applicable law) or such court may issue a writ of execution to
enforce the arbitrator's decision
14. Notices
All notices, requests, demands and other communications hereunder shall
be in writing and shall be deemed to have been duly given if personally
delivered, or if mailed by United States certified or registered mail, prepaid,
to the parties or their permitted assignees at the following addresses (or at
such other address as shall be given in writing by either party to the other):
TO THE COMPANY:
Seychelle Environmental Technologies, Inc.
00000 Xxxxx Xxxxxxxx
Xxx Xxxx Xxxxxxxxxx, Xxxxxxxxxx 00000
Attention: Mr. Xxxx Xxxxxx
TO CONSULTANT:
0000 Xxxxxx Xxxx., Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attention: Mr. Xxx Xxxxx and Xx. Xx Xxxxxxxxx
With a copy to:
Xxxxxx X. Xxxxxxxx, Esq.
XXXXXXXX, XXXXXXX & XXXXXXX
0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
The date of personal delivery or the date three days after mailing
shall be deemed to be the effective date of such notice, demand or
communication.
41
9
15. Headings
Headings herein are for convenience only, are not a part hereof and
shall not be used in construing this Agreement.
16. Entire Agreement
This Agreement constitutes and embodies the entire understanding and
agreement of the parties hereto relating to the matters addressed herein. Except
as otherwise provided herein, there are no other agreements or understandings,
written or oral, in effect between the parties relating to the matters addressed
herein.
17. Counterparts
This Agreement may be executed in counterparts, each of which shall be
deemed an original, but all of which shall constitute one instrument.
18. Further Acts
The parties hereto agree to execute and deliver such papers, documents
and instruments and to perform such acts as are necessary or appropriate to
implement the terms of the Agreement and the intent of the parties hereto.
IN WITNESS WHEREOF, the parties hereto have entered into this Agreement
effective as of the day and year first above written.
Mr. Xxx Xxxxx (the "Consultant")
/s/ Xxx Xxxxx
--------------------------------------
Mr. Xxx Xxxxx
SEYCHELLE ENVIRONMENTAL
TECHNOLOGIES, INC. (the "Company")
By: /s/ Xxxx X. Xxxxxx
-----------------------------------
Xxxx X. Xxxxxx,
President and
Chief Executive Officer
By: /s/ Xxxx X. Xxxxx
-----------------------------------
Xxxx X. Xxxxx,
Secretary
42
