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Exhibit 10
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT (this "Agreement") is entered into as of May 1,
1998 (the "Effective Date"), by and between New Directions Manufacturing, Inc.,
a Nevada corporation (the "Company"), and Xxxxxxx X. Xxxx ("Consultant").
RECITALS
WHEREAS, the Company desires to retain the Consultant to provide the
services set forth in Exhibit A hereto for the benefit of the Company (the
"Consulting Services");
WHEREAS, Consultant is engaged in the business of providing the Consulting
Services and desires to provide the Consulting Services to the Company in
accordance with the terms of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained herein, the parties hereto hereby agree as follows:
A G R E E M E N T
1. Appointment and Duties. The Company hereby engages Consultant to
perform the Consulting Services commencing upon the date of this Agreement and
terminating in accordance with the terms set forth in Exhibit A. Consultant
agrees to accept such engagement upon the terms and conditions set forth herein.
Consultant shall faithfully and diligently perform the Consulting Services.
2. Compensation. Subject to the termination of this Agreement as provided
herein, the Company shall compensate Consultant for the performance of the
Consulting Services hereunder upon the terms and conditions set forth in
attached Exhibit B hereto
3. Non-Exclusive; Non-Disclosure.
3.1. Consultant agrees to perform Consultant's Consulting Services
efficiently and to the best of Consultant's ability. It is anticipated that the
Consultant shall spend as much time as deemed necessary by the Consultant in
order to perform the obligations of Consultant hereunder. Notwithstanding the
foregoing, the Company acknowledges and agrees that Consultant's engagement with
the Company is not exclusive and that Consultant is engaged in other business
endeavors and reserves the right to continue to do so throughout the terms of
this Agreement.
3.2. Consultant acknowledges that Consultant may have access to
proprietary information regarding the business operations of the Company and
agrees to keep all such information secret and confidential and not to use or
disclose any such information to any individual or organization without the
Company's prior written consent.
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4. Independent Contractor. Both the Company and the Consultant agree that
the Consultant will act as an independent contractor in the performance of its
duties under this Agreement. Nothing contained in this Agreement shall be
construed to imply that Consultant, or any employee, agent or other authorized
representative of Consultant, is a partner, joint venturer, agent, officer or
employee of the Company.
5. Term; Termination
(a) Consultant may terminate this Agreement immediately for cause at
any time without notice. For purposes of this subsection (b), "cause" for
termination by Consultant shall be (i) a breach by The Company of any material
covenant or obligation hereunder; or (ii) the voluntary or involuntary
dissolution of the Company.
(b) The Company may terminate this Agreement for cause at any time
without notice. For purposes of this subsection (c), "cause" for termination
shall be: (i) any felonious conduct or material fraud by Consultant in
connection with The Company; (ii) any embezzlement or misappropriation of funds
or property of The Company by Consultant; (iii) any material breach of or
material failure to perform any covenant or obligation of Consultant under this
Agreement; or (iv) gross negligence by Consultant in the performance of his
duties under this Agreement.
6. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties hereto their respective devisees, legatees, heirs, legal
representatives, successors, and permitted assigns. The preceding sentence shall
not affect any restriction on assignment set forth elsewhere in this Agreement.
7. Notices
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Any notice, request, instruction, or other document required by the terms of
this Agreement, or deemed by any of the Parties he reto to be desirable, to be
given to any other Party hereto shall be in writing and shall be given by
facsimile, personal delivery, overnight delivery, or mailed by registered or
certified mail, postage prepaid, with return receipt requested, to the following
addresses:
If to the Company: Xxxxxx X. Xxxxx, President
New Directions Manufacturing, Inc.
0000 X. Xxxxxxxx
Xxxxxxx, XX 00000
With copy to: Xxxxx Xxxxxx, Esq.
Xxxxxxx & Beam
Xxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
If to Consultant: Xx. Xxxxxxx X. Xxxx, President
WADCO SERVICES INNS, INC.
0000 Xxxxxx Xxxxxxxxx
Xxxxx Xxxxx, XX 00000-0000
The persons and addresses set forth above may be changed from time to time
by a notice sent as aforesaid. If notice is given by facsimile, personal
delivery, or overnight delivery in accordance with the provisions of this
Section, said notice shall be conclusively deemed given at the time of such
delivery. If notice is given by mail in accordance with the provisions of this
Section, such notice shall be conclusively deemed given seven business days
after deposit thereof in the United States mail.
8. Entire Agreement. Except as provided herein, this Agreement contains
the entire agreement of the parties, and supersedes all existing negotiations,
representations, or agreements and all other oral, written, or other
communications between them concerning the subject matter of this Agreement.
9. Counterparts; Facsimile Signatures. This Agreement may be executed
simultaneously in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument. The Parties agree that facsimile signatures of this Agreement shall
be deemed a valid and binding execution of this Agreement.
10. Modification. No change, modification, addition, or amendment to this
Agreement shall be valid unless in writing and signed by all parties hereto.
11. Attorneys' Fees. Except as otherwise provided herein, if a dispute
should arise between the parties including, but not limited to arbitration, the
prevailing party shall be reimbursed by the non-prevailing party for all
reasonable expenses incurred in resolving such
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dispute, including reasonable attorneys' fees exclusive of such amount of
attorneys' fees as shall be a premium for result or for risk of loss under a
contingency fee arrangement. In the event of such a dispute, it shall be
resolved at the Orange County, California office of the American Arbitration
Association.
12. Assignment. Neither party shall assign its rights or obligations
under this Agreement without the express prior written consent of the other
party.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the Effective Date.
"The Company"
NEW DIRECTIONS MANUFACTURING, INC.
/s/ Xxxxxx X. Xxxxx
----------------------------
BY: Xxxxxx X. Xxxxx
ITS: President
"The Consultant"
/s/ Xxxxxxx X. Xxxx
----------------------------
Xxxxxxx X. Xxxx
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EXHIBIT "A"
DESCRIPTION OF CONSULTING SERVICES
During the three year period of time commencing upon the date of this
Agreement, the Consultant shall provide general business advice to the Company.
Additionally, if elected by the shareholders of the Company at their annual
meeting, the Consultant shall serve as a member of the Board of Directors of the
Company for three years.
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EXHIBIT "B"
COMPENSATION
The Consultant shall receive the following Compensation for the provision
of the Consulting Services:
1. Compensation in the form of stock. The Consultant shall have the right
to acquire 50,000 shares of restricted common stock of the Company at a price of
$0.01 per share simultaneous with the execution of this Agreement (the
"Shares"). The Shares shall not be sold, pledged, or transferred during the
three year term of this Agreement, except through a merger or sale of the
Company. If the Consultant does not serve as a consultant and/or director of the
Company for three full years (36 months) from May 1, 1998, due to resignation,
the failure to adequately perform his fiduciary duty (cause), or the failure of
the shareholders to elect or re-elect him, then, except in the case of a merger
or sale of the Company, the Consultant is obliged to sell back to the Company,
for each month less than the 36 months agreed to be served, 1/36th of the shares
at $0.01 per share.
In connection with the Consultant's right to purchase the Shares, the
Consultant hereby represents and warrants to the Company as follows:
(a) Consultant has sufficient liquid assets to invest in the Shares.
(b) Consultant has had an opportunity to ask questions of and
receive answers from the Company or a person or persons acting on its behalf
concerning the terms and conditions of the purchase of the Shares. Consultant is
satisfied with all information provided by the Company and/or persons acting on
behalf of the Company;
(c) Consultant acknowledges that the Shares are being solicited and
are exempt from registration pursuant to Regulation D of the Securities Act of
1933, as amended (the "Act"), and in connection therewith, covenants and agrees
that he will not offer, sell, or otherwise transfer the Shares unless and until
the Shares are registered pursuant to the Act or unless the Company shall be
entitled to rely upon an opinion of counsel satisfactory to Company with respect
to compliance with the above securities laws.
(d) Consultant understands he is purchasing the Shares without being
furnished any offering literature or prospectus other than any specific
information which the Consultant may have requested that the Company provide to
him.
(e) The Shares for which he hereby subscribes are being acquired
solely for his own account, for investment purposes only, and are not being
purchased with a view to or for the resale, distribution, subdivision or
fractionalizing thereof; he has no present plans to enter into any such
contract, undertaking, agreement or arrangement. Consultant understands that he
shall not have the right to sell or otherwise transfer the Shares unless and
until the Shares are registered for
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sale in the public securities markets. Consultant further understands that he
shall be subject to any underwriter or broker/dealer trading restrictions.
(f) Consultant acknowledges and is aware of the following:
(i) There are substantial restrictions on the transferability
of the Shares; the Shares will not be, and Consultant has no right to demand
that the Shares be, registered under the Act; and accordingly, he may have to
hold the Shares for a substantial period of time.
(ii) Consultant, by reason of his business or financial
experience, or the business or financial experience or his/her professional
advisor who is not affiliated with, or compensated by the Company or any of its
affiliates, or any selling agent of the Company, directly or indirectly, has the
capacity to protect his own interests in connection with his purchase of the
Shares.
(g) In order to purchase the Shares, Consultant shall:
(i) Deliver a check in the amount of $500 to "New
Directions Manufacturing, Inc.;" and
(ii) Execute this Agreement.
2. Reimbursement of expenses. The Consultant shall also be entitled to
reimbursement of all pre-approved expenses beginning on May 1, 1998 and
concluding, but subject to termination pursuant to 5.b. above or extension by
mutual agreement, on May 1, 2001.
