EXHIBIT 10.2
CONSULTING AGREEMENT
THIS AGREEMENT, made, entered into, and effective this 1st day of June, 2004
(the "Effective Date"), by and between Xxx Xxxxxxx, an Individual with its
principal place of business at 200 Winston Drive, Apartment 2603, Xxxxxxxxx
Xxxx, XX 00000 (hereinafter referred to as "Consultant"), and Xxxxxx Xxxxxx
Promotions, Inc., a Delaware corporation with its principal place of business at
0000 Xxxxxx xx Xxxxxxxx, Xxxxx 000, XX, XX 00000 (hereinafter referred to as
"Corporation").
W I T N E S S E T H:
WHEREAS, Consultant desires to provide such consulting services for the
Corporation as an independent contractor, with the understanding that he shall
not be required to devote his full time to the business of the Corporation and
shall be free to pursue other personal and business interests; and
WHEREAS, the Company is desirous of retaining the Consultant for the purpose of
corporate planning and financial restructuring.
NOW, THEREFORE, in consideration of the premises, the mutual covenants of the
parties herein contained and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged by each of the parties hereto,
it is agreed as follows:
1. CONSULTING ARRANGEMENT.
1.1 Contract for Services. The Corporation hereby contracts for the services of
Consultant and Consultant agrees to perform such duties and responsibilities and
to render advice and consulting as may be requested by the Corporation from time
to time during the term of this consulting arrangement in connection with the
Corporation's business throughout the United States and world wide ("Consulting
Arrangement"). Consultant shall use his best efforts to keep the Corporation
informed of all corporate business opportunities which shall come to his
attention and appear beneficial to the Corporation's business so that the
Corporation can obtain the maximum benefits from Consultant's knowledge,
experience, and personal contacts.
Services Rendered by Consultant. Said consulting services shall include, but not
be limited to, re- structuring the balance sheet for the Corporation,
negotiating with creditors, retiring debt, contract negotiation, preparation and
review of Private Placement Memoranda, and other consulting services as the
Corporation deems necessary directed toward strengthening the Corporation's
financial position. The Consultant also agrees that it will make substantial
introductions to the Corporation to potential investors who may be interested in
investing in various financing vehicles being offered for sale by the
Corporation.
1.3 Prohibited Services. The services to be rendered by the Consultant to the
Corporation shall under no circumstances include, directly or indirectly, the
following: (i) any activities which could be deemed by the Securities and
Exchange Commission to constitute investment banking or any other activities
required the Consultant to register as a broker-dealer under the Securities
Exchange Act of 1934; (ii) any activities which could be deemed to be in
connection with the offer or sale of securities in a capital-raising
transaction; or (iii) any market making or promotional activities regarding or
involving the Company's common stock.
2. RELATIONSHIP BETWEEN PARTIES. During the term of the Consulting Arrangement,
Consultant shall be deemed to be an independent contractor. He shall be free to
devote his time, energy and skill to any such person, firm or company as he
deems advisable except to the extent he is obligated to devote his time, energy
and skill to the Corporation pursuant to the terms of this Agreement, his
obligation to the Corporation shall supercede other obligations. Consultant
shall not be considered as having an employee status vis-a-vis the Corporation,
or by virtue of the Consulting Arrangement being entitled to participate in any
plans, arrangements or distributions by the Corporation pertaining to or in
connection with any pension, stock, bonus, profit sharing, welfare benefits, or
similar benefits for the regular employees of the Corporation. The Corporation
shall not withhold any taxes in connection with the compensation due Consultant
hereunder, and Consultant will be responsible for the payment of any such taxes
and hereby agrees to indemnify the Corporation against nonpayment thereof.
3. COMPENSATION FOR THE CONSULTING ARRANGEMENT.
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3.1 Consideration for Consulting Services. It is understood by the Consultant
that the Company is currently in the process of undertaking to solicit proxies
from its shareholders seeking to authorize an increase in the number of
authorized shares of common stock of the Company from 20 million shares to 100
million shares (the "Proxy"). As consideration for the consulting services to be
provided by Consultant during the term of this Agreement, the Consultant shall
receive monthly, commencing on the effective date of this agreement and
continuing until the agreement's termination, 10,000 restricted shares of the
company's common stock. Such shares shall be paid to Consultant within 30 days
of the completion of the proxy and any other necessary corporate action which
must be taken to issue said shares, such corporate action to be undertaken as
quickly as practicable. The Company shall undertake to register the shares on a
Form S-8 registration statement filing with SEC and shall use reasonable efforts
to seek effectiveness of the registration statement, but does not hereby
guarantee the success of those efforts. In the event that the Proxy is not
successfully completed on or before November 1, 2004, the parties hereto shall
attempt to renegotiate the terms of compensation otherwise provided hereunder.
In the event that the parties cannot agree on alternative compensation, this
Agreement shall be void and the Corporation shall have no obligation to the
Consultant hereunder.
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3.2 Expenses. Company agrees to pay for all costs and expenses incurred
associated with its employees' working with the Consultant, including lodging,
meals, and travel as necessary. Consultant shall furnish a completed expense
report to be approved by the Company prior to any reimbursement.
4. TERM OF CONSULTING ARRANGEMENT. The Consulting Arrangement shall begin
effective as of the Effective Date of this Agreement and shall continue for a
period of six (6) months (the "Consulting Period").
5. CONFIDENTIALITY COVENANTS.
5.1 Acknowledgments by the Consultant. The Consultant acknowledges that (a)
during the Consulting Period and as a part of his Consulting Arrangement, the
Consultant will be afforded access to Confidential Information (as defined
below); (b) public disclosure of such Confidential Information could have an
adverse effect on the Corporation and its business; (c) because the Consultant
possesses substantial technical expertise and skill with respect to the
Corporation's business, the Corporation desires to obtain exclusive ownership of
each Consultant Invention (as defined below), and the Corporation will be at a
substantial competitive disadvantage if it fails to acquire exclusive ownership
of each Consultant Invention; (d) the provisions of this Section 5 are
reasonable and necessary to prevent the improper use or disclosure of
Confidential Information and to provide the Corporation with exclusive ownership
of all Consultant Inventions.
5.2 Agreements of the Consultant. In consideration of the compensation and
benefits to be paid or provided to the Consultant by the Corporation under this
Agreement, the Consultant covenants as follows:
(a) Confidentiality. During and following the Consulting Period for a period of
not less than three years, the Consultant will hold in confidence the
Confidential Information and will not disclose it to any person except with the
specific prior written consent of the Corporation or except as otherwise
expressly permitted by the terms of this Agreement.
(i) Any trade secrets of the Corporation will be entitled to all of the
protections and benefits under New York Statutes and common law and any other
applicable law. If any information that the Corporation deems to be a trade
secret is found by a court of competent jurisdiction not to be a trade secret
for purposes of this Agreement, such information will, nevertheless, be
considered Confidential Information for purposes of this Agreement. The
Consultant hereby waives any requirement that the Corporation submit proof of
the economic value of any trade secret or post a bond or other security.
(ii) None of the foregoing obligations and restrictions applies to any part of
the Confidential Information that the Consultant demonstrates was or became
generally available to the public other than as a result of a disclosure by the
Consultant.
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(iii) The Consultant will not remove from the Corporation's premises (except to
the extent such removal is for purposes of the performance of the Consultant's
duties at home or while traveling, or except as otherwise specifically
authorized by the Corporation) any document, record, notebook, plan, model,
component, device, or computer software or code, whether embodied in a disk or
in any other form (collectively, the "Proprietary Items"). The Consultant
recognizes that, as between the Corporation and the Consultant, all of the
Proprietary Items, whether or not developed by the Consultant, are the exclusive
property of the Corporation. Upon termination of this Agreement by either party,
or upon the request of the Corporation during the Consulting Period, the
Consultant will return to the Corporation all of the Proprietary Items in the
Consultant's possession or subject to the Consultant's control, and the
Consultant shall not retain any copies, abstracts, sketches, or other physical
embodiment of any of the Proprietary Items.
(b) Consultant Inventions. Each Consultant Invention will belong exclusively to
the Corporation. The Consultant acknowledges that all of the Consultant's
writing, works of authorship, and other Consultant Inventions are works made for
hire and the property of the Corporation, including any copyrights, patents, or
other intellectual property rights pertaining thereto. If it is determined that
any such works are not works made for hire, the Consultant hereby assigns to the
Corporation all of the Consultant's right, title, and interest, including all
rights of copyright, patent, and other intellectual property rights, to or in
such Consultant Inventions. The Consultant covenants that he will promptly:
(i) disclose to the Corporation in writing any Consultant Invention;
(ii) assign to the Corporation or to a party designated by the Corporation, at
the Corporation's request and without additional compensation, all of the
Consultant's right to the Consultant Invention for the United States and all
foreign jurisdictions;
(iii) execute and deliver to the Corporation such applications, assignments, and
other documents as the Corporation may request in order to apply for and obtain
patents or other registrations with respect to any Consultant Invention in the
United States and any foreign jurisdictions;
(iv) sign all other papers necessary to carry out the above obligations; and
(v) give testimony and render any other assistance in support of the
Corporation's rights to any Consultant Invention.
5.3 Disputes or Controversies. The Consultant recognizes that should a dispute
or controversy arising from or relating to this Agreement be submitted for
adjudication to any court, arbitration panel, or other third party, the
preservation of the secrecy of Confidential Information may be jeopardized. All
pleadings, documents, testimony, and records relating to any such adjudication
will be maintained in secrecy and will be available for inspection by the
Corporation, the Consultant, and their respective attorneys and experts, who
will agree, in advance and in writing, to receive and maintain all such
information in secrecy, except as may be limited by them in writing.
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5.4 Definitions.
(a) For the purposes of this Section 5, "Confidential Information" shall mean
any and all:
(i) trade secrets concerning the business and affairs of the Corporation,
product specifications, data, know-how, formulae, compositions, processes,
designs, sketches, photographs, graphs, drawings, samples, inventions and ideas,
past, current, and planned research and development, current and planned
manufacturing or distribution methods and processes, customer lists, current and
anticipated customer requirements, non-public financial or business information,
price lists, market studies, business plans, computer software and programs
(including object code and source code), computer software and database
technologies, systems, structures, and architectures and related formulae,
compositions, processes, improvements, devices, know-how, inventions,
discoveries, concepts, ideas, designs, methods and information, and any other
information, however documented, that is a trade secret within the meaning of
Chapter 688, Florida Statutes;
(ii) information concerning the business and affairs of the Corporation (which
includes historical financial statements, financial projections and budgets,
historical and projected sales, capital spending budgets and plans, the names
and backgrounds of key personnel, personnel training and techniques and
materials, however documented; and
(iii) notes, analysis, compilations, studies, summaries, and other material
prepared by or for the Corporation containing or based, in whole or in part, on
any information included in the foregoing.
(b) For the purposes of this Section 5, "Consultant Invention" shall mean any
idea, analysis, compilation, invention, technique, modification, process, or
improvement (whether subject to patent, copyright or trademarkable protection --
or not), any industrial design (whether registerable or not), and any work of
authorship (whether or not copyright protection may be obtained for it) created,
conceived, or developed by the Consultant, either solely or in conjunction with
others, during the Consulting Period, or a period that includes a portion of the
Consulting Period, that relates in any way to, or is useful in any manner in,
the business then being conducted or proposed to be conducted by the
Corporation, and any such item created by the Consultant, either solely or in
conjunction with others, following termination of the Consultant's Consulting
Arrangement with the Corporation, that is based upon or uses Confidential
Information.
6. NON-COMPETITION AND NON-INTERFERENCE
6.1 Acknowledgments by the Consultant. The Consultant acknowledges that: (a) the
services to be performed by him under this Agreement are of a special, unique,
unusual, extraordinary, and intellectual character; (b) the Corporation's
business is national in scope and its products/services are marketed throughout
the United States and world wide; (c) the Corporation competes with other
businesses that are or could be located in any part of the United States and
world wide; (d) the provisions of this Section 6 are reasonable and necessary to
protect the Corporation's business.
6.2 Covenants of the Consultant. In consideration of the acknowledgments by the
Consultant, and in consideration of the compensation and benefits to be paid or
provided to the Consultant by the Corporation, the Consultant covenants that he
is expressly prohibited from any of the following (either directly or
indirectly) during the period of the Consulting Agreement and for three years
after the conclusion of the Consulting Agreement:
(a) disclosing any Confidential Information of the Corporation.
(b) consulting for or investing in, owning, managing, operating, financing,
controlling, or participating in the ownership, management, operation,
financing, or control of, be employed by, associated with, or in any manner
connected with, lend the Consultant's name or any similar name to, lend
Consultant's credit to or render services or advice to, any business whose
products or activities compete in whole or in part with the products or
activities of the Corporation anywhere within the United States;
(c) whether for the Consultant's own account or for the account of any other
person, soliciting business of the same or similar type being carried on by the
Corporation, from any person known by the Consultant to be a customer or
competitor of the Corporation, whether or not the Consultant had personal
contact with such person during and by reason of the Consultant's Consulting
Arrangement with the Corporation;
(d) whether for the Consultant's own account or the account of any other person
(i) soliciting, employing, or otherwise engaging as an employee, independent
contractor, or otherwise, any person who is or was an employee of the
Corporation at any time during the Consulting Period or in any manner inducing
or attempting to induce any employee of the Corporation to terminate his
Consulting Arrangement or employment arrangement with the Corporation; or (ii)
interfering with the Corporation's relationship with any person, including any
person who at any time during the Consulting Period was an employee, contractor,
supplier, or customer of the Corporation; or
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(e) at any time during or after the Consulting Period, disparaging the
Corporation or any of its shareholders, directors, officers, employees, or
agents.
If any covenant in this Section 6.2 is held to be unreasonable, arbitrary, or
against public policy, such covenant will be considered to be divisible with
respect to scope, time, and geographic area, and such lesser scope, time, or
geographic area, or all of them, as a court of competent jurisdiction may
determine to be reasonable, not arbitrary, and not against public policy, will
be effective, binding, and enforceable against the Consultant. The period of
time applicable to any covenant in this Section will be extended by the duration
of any violation by the Consultant of such covenant.
7. NOTICES. All notices, consents, waivers, and other communications under this
Agreement must be in writing and will be deemed to have been duly given when (a)
delivered by hand (with written confirmation of receipt), (b) sent by facsimile
(with written confirmation of receipt), provided that a copy is mailed by
registered mail, return receipt requested, or (c) when received by the
addressee, if sent by a nationally recognized overnight delivery service
(receipt requested), in each case to the appropriate addresses and facsimile
numbers set forth below (or to such other addresses and facsimile numbers as a
party may designate by notice to the other parties):
If to the Corporation: Xxxxxx Xxxxxx Promotions, Inc. a Delaware Corp.
Xxxxx Xxxxxxxxx, Vice President
0000 Xxxxxx xx Xxxxxxxx
Xxxxx 000
Xxx Xxxx, Xxx Xxxx 00000
If to the Consultant: Xxx Xxxxxxx
000 Xxxxxxx Xxxxx
Apartment 2603
Xxxxxxxxx Xxxx, XX 00000
8. BINDING EFFECT. This Agreement shall extend to, shall inure to the benefit of
and shall be binding upon all the parties hereto and upon all of their
respective heirs, successors and representatives.
9. ENTIRE AGREEMENT. This Agreement, including the agreements incorporated by
reference, contains the entire Agreement among the parties hereto with respect
to the matters contemplated hereby and supersedes all prior agreements and
undertakings between the parties with respect to such matters. This Agreement
may not be amended, modified or terminated in whole or in part, except in
writing, executed by each of the parties hereto.
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10. INDEMNIFICATION. Consultant hereby agrees to hold harmless and indemnify
Corporation from and against any and all loss, damage, expense, and cost
(including reasonable attorneys' fees incurred in connection with the same)
incurred by Corporation as a result of Consultant's breach of any covenant or
agreement made herein.
11. SPECIFIC PERFORMANCE. The Consultant acknowledges that any violation of the
restrictive covenants or confidentiality provisions in this agreement would
result in damages to the Corporation that are imminent and irrevocable in nature
and are further difficult to measure in terms of monetary damages. It is
acknowledged and agreed by Consultant that any breach of these provisions shall
constitute irreparable injury to the Corporation and Consultant consents to the
entry of a temporary, preliminary and permanent injunction without need of a
bond to prevent any such injury to the Corporation.
12. SEVERABILITY. Should any part of any provision of this Agreement be declared
invalid by a court of competent jurisdiction, such decision or determination
shall not affect the validity of any remaining portion of such provision or any
other provision and the remainder of the Agreement shall remain in full force
and effect and shall be construed in all respects as if such invalid or
unenforceable provision or portion thereof were not contained herein. In the
event of a declaration of invalidity, the provision or portion thereof declared
invalid shall not necessarily be invalidated in its entirety, but shall be
observed and performed by the parties to the Agreement to the extent such
provision is valid and enforceable.
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13. SECTION HEADINGS. The section headings contained herein are for convenience
of reference only and shall not be considered any part of the terms of this
Agreement.
14. CHOICE OF LAW. This Agreement shall be interpreted and performed in
accordance with the laws of the State of New York, and the parties agree,
notwithstanding the principles of conflicts of law, that the internal laws of
the State of New York shall govern and control the validity, interpretation,
performance, and enforcement of this Agreement. Venue for any action under this
Agreement shall rest in the Courts of New York County in the State of New York.
IN WITNESS WHEREOF, Consultant has hereunto put his hand, and the Corporation
has caused this instrument to be executed in its corporate name by its duly
authorized officer, all as of the day and year first above written.
NOTE: ALL OTHER PREVIOUS AGREEMENTS SIGNED OR UNSIGNED ARE NULL AND VOID. THIS
AGREEMENT WILL BE FINAL UNLESS BOTH PARTIES AGREE TO IN WRITING FOR ANY AND ALL
OTHER CHANGES.
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CONSULTANT: CORPORATION:
Xxx Xxxxxxx Xxx XxXxxxxxx, Vice President
By: /s/ Xxx Xxxxxxx By: /s/ Xxx XxXxxxxxx
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