1
ADVISORY AGREEMENT
This Agreement is made and entered into this sixth day of February, by and
between: High Speed Net Solutions, represented by Xxxx Xxxxxx whose principal
address is 0000 X. Xxxxxxxxx Xxxxx, Xxxxx Xxxxx, XX 00000 (hereinafter referred
to as the "Company") and R X. Xxxxxxx Enterprises and or assigns, represented by
Xxxxxxx Xxxxxxx, whose principal address is 0000 Xxxxxxxx Xxxxxx, Xxxxxx Xxxx,
XX 00000 (hereinafter referred to as the "Advisor");
W I T N E S S E T H:
Whereas, Advisor is in the business of securing and/or finding entities
which possess the ability to fund venture capital projects, introduce potential
marketing channels and sources of revenues, Joint Ventures, Strategic alliances
or acquirers and;
Whereas, Advisor desires to introduce the Company to eligible entities
with the ability to provide funding for, sources of revenue, Joint Ventures, and
Strategic alliances to the Company, and;
Whereas, the Company hereby engages Advisor and its affiliates, giving
them Authorization to advise and assist the Company in obtaining funding and
additional revenue sources, and;
Advisor will offer any investment opportunity only to accredited/exempt
investors.
Therefore, in consideration of the premises and the respective mutual
covenants, agreements, representations and warranties hereinafter set forth, the
parties hereto, intending to be legally bound, agree as follows:
SECTION 1.01 DEFINITIONS
Funding: For the purpose of this Agreement, all references to funding
will represent sources as follows: cash moneys, loans, letters of credit, debt,
convertible debt, equity capital, debt or equity investments by joint venture
partners, strategic alliances or acquirers, wired money transfers and all like
transactions, any sources of revenue to the Company, including product or
service sales, licensing fees, royalties, etc. originated, initiated and closed
by advisor's primary efforts.
SECTION 2.01 THE COMPANY'S COMMITMENT
The Company agrees that any funding it receives during the term of this
Agreement shall require a payment of success fee to Advisor as follows:
a) The Company agrees that any funding/sources of revenue
received from any entity directly or indirectly controlled by
any agency introduced to the Company
2
by Advisor for as long as such funding/source of revenue shall
last, excepting Xxxxxx Xxxxxxxxx of Stenton Xxxxx, Xxxx Xxxx
and any other advisor under contract with the company, shall
earn a success fee for Advisor as outlined in this agreement.
It is understood that an investor who was an initial investor
and invests again in the Company within two years will
precipitate an additional Advisor's fee.
b) The Company recognizes that the personal and business contacts
introduced to the Company by Advisor are proprietary to
Advisor.
c) The Company will be responsible for all expenses in connection
with its fundraising efforts, including legal fees, copying,
mailing, conference arrangements, etc. Any expenses incurred
by Advisor that are to be reimbursed must be approved by the
Company in advance such as travel expenses reasonably related
to the advisor's dissemination of information about the
Company.
SECTION 2.02 THE ADVISOR'S COMMITMENT
a) The Advisor agrees to make reasonable and "best efforts" to
advise and assist the Company to obtain the funding sought.
b) The Advisor agrees to supply a report at the conclusion of the
term of this Agreement that contains a list of the potential
entities to whom this opportunity has been introduced directly
or indirectly. Only entities on the report will entitle the
Advisor to a fee after the term of this Agreement.
SECTION 3.01 TERM
The term of this agreement is one year and will be renewed for
successive one-year terms unless canceled in writing by either party on thirty
days written notice prior to the end of any term. The Company may terminate this
agreement on thirty (30) days' notice for any reason; however, advisor shall
remain entitled to any success fees earned during the term hereof. Additionally
advisor shall have right to success fee for funding sources, as defined in
section 1.01, Definitions of funding, that are introduced prior to termination
but closed within six months after termination.
SECTION 4.01 SUCCESS FEE
Subject to the terms of this Agreement, the Company hereby expressly
agrees to pay the Advisor a success fee for its services as follows:
a) For equity capital raised, or any non-debt source of funding
or revenue secured by the Company during the term of this
Agreement resulting from any source,
2
3
contact, or introduction by Advisor, a success fee in cash
equal to 10% of the gross dollar amount of any equity funding
or sources of revenue, or its equivalent.
b) For debt funding raised by the Company during the term of this
Agreement resulting from any, course, contact, or introduction
by Advisor, a success fee, in cash equal to the amount of 5%
of the gross dollar amount of the debt funding received.
SECTION 5.01 THE COMPANY'S OBLIGATION TO PAY
The Company hereby expressly agrees to pay the Advisor the success fees
owed as follows:
a) In the case of cash success fees, the Company will remit fees
to Advisor within five business days of receipt of cleared
funds in the Company's account.
b) If there is a failure to make any payment to Advisor at the
time required, the delinquent sum(s) shall bear interest at
the rate of 15% per year, or the maximum non-usurious interest
rate for loans permitted by the Pennsylvania law, whichever is
the lower of the two rates.
SECTION 6.01 BOARD APPROVAL
This Agreement must be approved by the Company's Board of Directors.
SECTION 7.01 BINDING COVENANT
Xxxx Xxxxxx'x signature to this agreement represents and warrants that
this Agreement will be binding and enforceable against the corporation.
SECTION 8.01 NONCOMPETE - NON-DISCLOSURE
The attached Non-Compete, Non-Disclosure Agreement is an integral part of this
Agreement.
SECTION 9.01 MISCELLANEOUS TERMS
a) No Personal Liability. It is agreed that there will be no
personal liability for any individual, Director or Officer of
the companies involved in this Agreement.
b) Waiver. No waiver by a party of any provision of this
Agreement shall be considered a waiver of any other provision
or subsequent breach of the same or any other provision. The
exercise by a party of any remedy provided in this Agreement
or at law shall not prevent the exercise by that party of any
other remedy provided in this Agreement or at law.
3
4
c) Severability. If any condition or covenant herein is held to
be invalid or void by any court of competent jurisdiction, the
same shall be deemed severable from the remainder of this
Agreement and shall in no way affect the other covenants and
conditions contained herein.
d) Notice. All written notices, demands, or requests of any kind
must be served by registered or certified mail, with postage
prepaid and return receipt requested, or by personal service
or facsimile, provided that acknowledgment of receipt is made.
Notices shall be delivered to the parties at the addresses
specified at the beginning of this Agreement, or at such
others as may be from time to time specified.
e) Entire Agreement. This Agreement, including any Exhibits or
Schedules attached hereto, contains all of the
representations, warranties, and the entire understanding and
agreement between the parties.
f) Governing Law and Venue. This Agreement shall be governed by
and construed in accordance with the laws of the State of
Pennsylvania. The exclusive venue for any lawsuit of
arbitration under this Agreement shall be the County of
Xxxxxxxxxx, Pennsylvania.
g) Time. Time is of the essence in this Agreement.
IN WITNESS WHEREOF, the parties hereto have this Agreement as of the
date and year first above written.
Date: 02/08/99 By: /s/ Xxxxxxx Xxxxxxx
----------------------- ---------------------------------
X. X. XXXXXXX ENTERPRISES
Date: 2/9/99 By: /s/ Xxxxxxx X. Xxxxxx
----------------------- ---------------------------------
President High Speed Net Solutions
4
