Exhibit 10.1
CONSULTING AGREEMENT
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THIS CONSULTING AGREEMENT (this "Agreement") is made as of the 23rd day
of August, 2001 (the "Effective Date") between TTI HOLDINGS OF AMERICA, INC., a
Delaware corporation with its principal address at 00 Xxxxx Xxxxxxxx,
Xxxxxxxxxx, XX 00000 (together with its subsidiaries and affiliates the
"Company") and CROSSOVER ADVISORS, LLC, a New York limited liability company
with its principal address at 000 Xxxxxxx Xxxxxx - 0xx Xxxxx, Xxx Xxxx, XX 00000
(the "Consultant").
Background
The Company and the Consultant wish to have the Consultant provide
financial, strategic and marketing advisory services to the Company, on the
terms and conditions set forth in this Agreement.
Accordingly, the parties intending to be legally bound agree as
follows:
1. Appointment. The Company hereby engages the Consultant to provide the
consulting services as described in Section 2.1 below (the "Services")
during the Term and any Renewal Term (defined in Section 3.1 below), and
the Consultant accepts the engagement.
2. Services.
2.1 During the Term and any Renewal Term, the Consultant will,
upon request, provide to the Company the Services on an "as
needed" basis, including, but not limited to, those described
below.
(a) assisting management in refining its business plan;
(b) assisting management in connection with identifying and
evaluating potential investments, acquisitions, strategic
partnerships, joint ventures and/or licensing opportunities
for the Company and its products and services (each a
"Strategic Transaction");
(c) disseminating information about the Company to the investment
community at large;
(d) arranging on behalf of the Company, at appropriate times,
introductions and/or meetings with broker/dealers, investment
firms and securities analysts, among others;
(e) assisting management in broadening the Company's financial and
investor public relations; and
(f) providing such other related consulting services as mutually
agreed to by the Company and the Consultant.
2.2 Staffing. The Consultant will maintain in its employ, or
otherwise have available to it, personnel sufficient in number
and adequate in ability to perform the Services in accordance
with this Agreement. The Consultant will have the exclusive
right to direct and control its personnel and/or third parties
providing the Services, other than in respect of the Company's
right, as the recipient of the Services, to supervise the
performance of the Consultant under this Agreement.
2.3 Non-Exclusivity. The Company expressly understands and agrees
that the relationship with the Consultant is on a
non-exclusive independent contractor basis for the Services
and that the Consultant shall not be prevented, barred or
limited from rendering consulting services of the same nature
or of a similar nature to those described in this Agreement,
or of any nature whatsoever, for or on behalf of any person,
firm, corporation, or entity other than the Company during the
Term and any Renewal Term
2.4 Place of Performance. In connection with the Services
performed by the Consultant, the Consultant's activities shall
be principally based in its New York City office, except for
required and approved travel on the Company's behalf.
3. Term and Termination.
3.1 Term. Unless terminated earlier under Section 3.2 below, the
term of this Agreement will be eighteen (18) months (the
"Term") commencing on the Effective Date. The Term will
automatically renew for an additional twelve (12) month period
(the "Renewal Term") unless at least thirty (30) days prior to
the end of the Term either party provides written notice to
the other party that it does not intend to renew.
3.2 Termination.
(a) This Agreement may be terminated prior to the expiration of
the Term or any Renewal Term by (i) either party if a material
breach to this Agreement by the other party is not effectively
cured within 10 days (the "Cure Period") from receipt of
written notice of the breach from the non-breaching party or
(ii) by the Consultant if the Registration Statement (as
described in Section 4.1 (b) below) is not declared effective
by the Securities and Exchange Comission (SEC) within ninety
(90) days of the Effective Date.
(b) The date of termination (the "Termination Date") shall be
defined to mean; (i) with regard to Section 3.2 (a) (i), the
date upon which the Cure Period expires and there has been no
cure, or with regard to Section 3.2 (a) (ii), the ninetieth
day as referred to therein and (ii) with regard to Section
3.1, the last day of the Term, or any Renewal Term.
3.3 Effect of Termination.
(a) Termination under Section 3.2 will not affect any other remedy
or damages available to either of the parties. Upon
termination of this Agreement, no party will have any further
obligation to fulfill commitments under this Agreement, except
for those obligations set forth in this Section 3 and in
Sections 4,6, 7, 8 and 9, each of which expressly survive the
termination of this Agreement.
(b) On the Termination Date, the Company shall pay to the
Consultant any earned but unpaid Consulting Fees (defined
below), any unreimbursed expenses up through the appropriate
date, and shall issue and deliver securities due and issuable
in accordance with Section 4.1 below.
4. Compensation
4.1 Sign-On Fee. On the Effective Date, as compensation for
engaging the Consultant and as an inducement for the
Consultant to commit its resources to the Company, the Company
shall issue and deliver to the Consultant, or its authorized
designee, on a non-refundable basis, a total of 440,000 shares
of the Company's common stock $.0001 par value, of which:
a) 100,000 shares shall be free trading and unrestricted
as of the Effective Date; and
b) 340,000 shares shall bear a restrictive legend and
have immediate registration rights and shall be
included on a registration statement (Form SB-2 or
otherwise) filed by the Company with the SEC (the
"Registration Statement") no later than thirty (30)
days following the Effective Date, the cost and
expense of which will be borne by the Company.
4.2 Monthly Fee. During the Term and any Renewal Term, as
compensation for the Services provided in Section 2 hereof (in
addition to any fees that may be earned for a Strategic
Transaction as set forth in Section 5 below), the Consultant
shall be paid a fee of $10,000 per month (the "Consulting
Fee"), payable in advance on the first business day of each
month. It is agreed to that the Consulting Fee shall not be
payable until the earlier to occur of (i) ninety (90) days
following the Effective Date or (ii) the date the Registration
Statement is declared effective.
4.3 Expenses. The Consultant shall be promptly reimbursed for all
reasonable out-of-pocket expenses (including travel,
entertainment, etc.) incurred by it in its performance under
this Agreement, upon submission of documentation supporting
such expense(s).
5. Strategic Transaction Services
The Consultant, or an affiliate, may provide the Company, if so requested, with
finder services which may include the identification and introduction to the
Company of parties that would be interested in completing a Strategic
Transaction with the Company. Accordingly, if the Consultant introduces the
Company (or any of its subsidiaries or affiliates) to a party that, during the
Term, any Renewal Term or during the one (1) year period following the
Termination Date, completes, or enters into a letter of intent to complete, a
Strategic Transaction (as set forth below) in which;
i. the introduced party makes an investment in, or
provides financing to, the Company through the
purchase of its securities; and/or
ii. the introduced party enters into a partnership, joint
venture, or licensing agreement or any other
agreement for the mutual exploitation of any asset of
the Company; and/or
iii. the Company either invests in, merges with or
acquires the introduced party, or, the introduced
party merges with or acquires the Company.
The Company will pay to the Consultant, or an affiliate, an investment banking
fee (which shall include a cash and Warrant component) with respect to each and
every transaction undertaken by the Company with each party during such time
period, that will be mutually agreed to prior to such introduction and which
will reflect a customary industry fee arrangement.
6. Indemnification.
6.1 Indemnification by the Company. If in connection with any
services or matters that are the subject of arise out of this
Agreement or the Consultant's engagement hereunder, the
Consultant or any of its directors, officers, stockholders,
employees of agents (collectively, the "Consultant
Indemnitees") becomes involved (whether or not as a named
party) in any action, claim, investigation or legal
proceeding, the Company, will indemnify and save harmless such
Consultant Indemnitees from and against any and all claims,
liabilities, damages, losses, costs and expenses (including
amounts paid in satisfaction of judgments in compromises and
defending against any claims or alleged claims) of any nature
whatsoever, liquidated or unliquidated, that are incurred by
any Consultant Indemnitees' obligations under this Agreement
unless the claim or alleged claim resulted from willful
misconduct, negligence or fraud of the Consultant Indemnitees.
The Company agrees that, without the Consultant
Indemnitees'prior written consent, it will not settle,
compromise or consent to the entry of any judgment in any
pending or threatened claim, action or proceeding in respect
of which indemnification could be sought under this Section 6
(whether or not the Consultant Indemnitees are actual or
potential parties to such claim, action or proceeding), unless
such settlement, compromise or consent includes an
unconditional release of each Consultant Indemnitee from all
liability arising out of such claim, action or proceeding.
6.2 Indemnification by the Consultant. If in connection with any
services or matters that are the subject of arise out of this
Agreement or the Consultant's engagement hereunder, the
Company or any of its directors, officers, stockholders,
employees of agents (collectively, the "Company Indemnitees")
becomes involved (whether or not as a named party) in any
action, claim, investigation or legal proceeding, the
Consultant, will indemnify and save harmless such Company
Indemnitees from and against any and all claims, liabilities,
damages, losses, costs and expenses (including amounts paid in
satisfaction of judgments in compromises and defending against
any claims or alleged claims) of any nature whatsoever,
liquidated or unliquidated, that are incurred by any Company
Indemnitees' obligations under this Agreement unless the claim
or alleged claim resulted from willful misconduct, negligence
or fraud of the Company Indemnitees. The Consultant agrees
that, without the Company Indemnitees' prior written consent,
it will not settle, compromise or consent to the entry of any
judgment in any pending or threatened claim, action or
proceeding in respect of which indemnification could be sought
under this Section 6 (whether or not the Company Indemnitees
are actual or potential parties to such claim, action or
proceeding), unless such settlement, compromise or consent
includes an unconditional release of each Company Indemnitee
from all liability arising out of such claim, action or
proceeding.
6.3 Procedures. As to any claim or lawsuit with respect to which
party seeks indemnification hereunder (the "Indemnified
Party"), it shall provide prompt notice thereof to the other
party (the "Indemnifying Party"), and the Indemnifying Party
shall have the right to control the defense of said lawsuit,
including the selection of attorneys, and any settlement
thereof, provided that no settlement which impairs the rights
of the Indemnified Party shall be made without its prior
written consent, which consent shall not be unreasonably
withheld.
7. Binding Arbitration.
a) Any dispute not settled through mediation will be
settled by binding expedited arbitration in
accordance with the commercial Arbitration Rules of
the American Arbitration Association (the "AAA
Arbitration Rules") in effect from time to time.
Where no remedy for a particular breach is specified
in this Agreement, the arbitrator, subject to any
limitations set forth in the applicable agreement,
will have the power to fashion an appropriate remedy
consistent with the spirit and intent of this
Agreement. Any disputing party may serve the other
disputing party or parties with a demand to commence
binding arbitration ("Arbitration Demand"). The
arbitrator will be selected by mutual agreement of
the disputing parties. If the disputing parties are
unable to agree upon an arbitrator within 20 days
after the date on which the Arbitration Demand is
served, then the Arbitrator will be selected in
accordance with the AAA Arbitration Rules.
b) The arbitration will be held in New York County and
begoverned by the laws of the State of New York, and
judgment upon the award rendered by the arbitrator
may be entered by any court having jurisdiction
thereof. The disputing parties will cooperate fully
to ensure the entry of the arbitrator's award by a
court of competent jurisdiction. Once the
arbitrator's award has been entered by a court of
competent jurisdiction, the arbitrator's award will
have res judicata and collateral estoppel effect, and
the disputing parties will not seek or assert the
right in any manner whatsoever to challenge the
validity of the arbitration or relitigate issues
adjudicated by the arbitrator.
8. Covenants.
8.1 Confidentiality. With respect to information of the Company,
which is clearly marked "Confidential", whatever its nature
and form and whether from Graphic Materials (as defined below)
or otherwise (except such as is generally available through
publication or is previously known to the Consultant, or is
lawfully obtained by the Consultant through a third-party),
obtained by the Consultant during or as a result of its
consultancy with the Company and relating to any invention,
improvement, enhancement, product, know-how, formula,
software, process, design, or other creation, or to any use of
any of them, costs (including, without limitation,
manufacturing costs), prices, or to any plans of the Company,
or to any other trade secret or proprietary information of the
Company, the Consultant agrees:
a) to hold all such information, inventions and
discoveries which have not otherwise become public
knowledge in strict confidence and not to publish or
otherwise disclose any thereof to any person or
entity other than the Company except with the prior
written consent of an officer of the Company, or as
may be required by law.
b) to take all reasonable precautions to assure that all
such information, inventions and discoveries are
properly protected from access by unauthorized
persons.
c) to make no use of nor exploit in any way any such
information, invention or discovery except as
required in the performance of its consultancy for
the Company.
For the purposes of this Agreement, the term "Graphic Materials" includes,
without limitation, letters, memoranda, reports, notes, notebooks, books of
account, drawings, prints, specifications, formulae, software, data print-outs,
microfilms, magnetic tapes and disks and other documents and recordings,
together with all copies, excerpts and summaries thereof.
8.2 Further Assurances. The Company and Consultant will use their
best efforts to implement the provisions of this Agreement,
and for such purpose neither party shall represent to the
other any material facts concerning itself during the Term and
any Renewal Term which are false, misleading or untrue and
neither party shall intentionally fail to provide the other
with material facts concerning itself or will in any material
manner prevent the Services from being performed under this
Agreement.
9. Miscellaneous.
9.1 Limitation of Liability. IT IS UNDERSTOOD BETWEEN THE PARTIES
THAT NEITHER THE CONSULTANT NOR ANY OF ITS PARTNERS,
EMPLOYEES, AGENTS, OR PRINCIPALS ARE PROVIDING LEGAL SERVICES,
ACCOUNTING SERVICES, NOR BROKERAGE SERVICES, AND SUCH SERVICES
MUST BE RETAINED BY THE COMPANY AT ITS OWN COST AND EXPENSE.
IT IS EXPRESSLY ACKNOWLEDGED THAT THE CONSULTANT WILL UTILIZE
ITS BEST EFFORTS IN PERFORMING THE SERVICES CONTEMPLATED
HEREBY BUT NO REPRESENTATIONS ARE MADE OR GUARANTEE GIVEN BY
THE CONSULTANT AS TO THE AMOUNT OF TIME IT WILL SPEND IN
PROVIDING THE SERVICES NOR TO THE ULTIMATE SUCCESS OF ANY
TRANSACTION OR OTHER ACTION UNDERTAKEN BY THE COMPANY. IN NO
EVENT WILL THE AGGREGATE DAMAGES CLAIMED BY THE COMPANY UNDER
THIS AGREEMENT EXCEED THE TOTAL CASH FEES RECEIVED BY THE
CONSULTANT, EXCEPT IN THE CASE OF WILLFUL MISCONDUCT, GROSS
NEGLIGENCE OR ACTUAL FRAUD.
9.2 Notices. All notices and other communications provided for or
permitted in this Agreement will be made in writing by
hand-delivery, registered first-class mail, or courier
guaranteeing overnight delivery:
If to the Company to:
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TTI Holdings of America, Inc.
00 Xxxxx Xxxxxxxx
Xxxxxxxxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxxx, Chief Executive Officer
If to the Consultant to:
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Crossover Advisors, LLC
000 Xxxxxxx Xxxxxx - 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxx, Managing Member
or at such other address as any party specifies by notice given to the
other parties in accordance with this Section 9.2
All notices and communications will be deemed to have been duly given;
at the time delivered by hand, if personally delivered; three business
days after being deposited in the mail, postage prepaid, if mailed;
when receipt acknowledged, and on the next business day if timely
delivered to a courier guaranteeing overnight delivery; provided,
however, that the inability to deliver any notice or other
communication because of the changed address of which no notice was
given, or rejection or refusal to accept any notice or other
communication as of the date if such inability to deliver or rejection
or refusal to accept delivery.
9.3 Waivers. The failure of a party to this Agreement to insist
upon strict adherence to any of the terms of this Agreement on
any occasion will not be considered a waiver, or deprive that
party of the right thereafter to insist upon strict adherence
to that term or other term of this Agreement. Any waiver must
be in writing.
9.4 Force Majeure. The Consultant will not be responsible for any
failure or delay in performance of its obligations under this
Agreement because of circumstances beyond its reasonable
control including acts of God, fires, floods, wars, civil
disturbances, sabotage, accidents, labor disputes (whether or
not the employees' demands are reasonable and within the
party's power to satisfy), governmental actions or
transportation delays.
9.5 Governing Law. This Agreement, the rights of the parties in,
under and to this Agreement and any dispute or action relating
to this Agreement (whether in contract, tort or otherwise)
will be governed by, construed and enforced in accordance with
the laws of New York applicable to the agreements made and
performed entirely in that State. Any legal actions, suits or
proceeding arising out of this Agreement (whether arising in
contract, tort or otherwise) other than any claim, action,
dispute or controversy subject to arbitration under Section 7
hereof, will be brought exclusively in a federal or state
court located in the State of New York having jurisdiction of
those courts with respect to any legal actions, suits or
proceeding (whether arising in contract, tort or otherwise)
arising out of this Agreement. In the event of any legal
action, suit or proceeding, the parties waive their right to a
jury trail.
9.6 Entire Agreement; Amendments. This Agreement represents the
entire understanding of the parties and superceded and cancels
any and all prior negotiations, undertakings and agreements
between the parties, whether written or oral, with respect to
the subject matter of the Agreement. This Agreement may be
amended, modified, waived or terminated only by a written
instrument signed by both parties to this Agreement.
9.7 Binding Effect. This Agreement will insure to be the benefit
of and will be binding upon the parties their respective
successors, permitted transferees and assigns.
9.8 Assignment and Benefits of Agreement. This Agreement may not
be assigned by any party to this Agreement without the written
consent of the other party. Nothing in this Agreement, express
or implied, is intended to confer upon any person other that
the parties hereto, and their said successors and assigns, any
rights under or by reason of this Agreement.
9.9 Independent Contractor. Each of the Company and the Consultant
certifies that neither party has any authority to act for or
bind the other party except as expressly provided for in this
Agreement, that the Consultant may work for others, and that
any persons provided by the Consultant under this Agreement
will be solely the employees or agents of the Consultant under
its sole and exclusive direction and control.
9.10 Severability. To the extent that any provision of this
Agreement or the application thereof is determined by a court
of competent jurisdiction to be invalid or unenforceable, the
remainder of this Agreement, or the application of such a
provision under other circumstances, will be unaffected and
will continue in full force and effect unless the invalid or
unenforceable provision is of such essential importance for
this Agreement that it is to be reasonably assumed that the
parties would not have concluded this Agreement without the
invalid or unenforceable provision.
9.11 Consents. Any consent or approval to be given under this
Agreement may be delegated by the party to give such consent
or approval to any agent or representative as such party may,
from time to time, authorize in writing.
9.12 Counterparts. This Agreement may be executed in any number of
counterparts, and each of the parties on separate
counterparts, each of which, when so executed, will be deemed
an original, not all of which will constitute but one and the
same original.
9.13 Third Parties. Nothing in this Agreement, expressed or
implied, is intended or will be construed to confer upon or
give any person other than parties to this Agreement, their
permitted successors or assigns and (to the extent indicated
herein) any rights or reminded under or by reason of this
Agreement.
9.14 Further Assurances. Each party will take or perform such
actions as reasonable requested by the other party, including
the execution of any additional documents, in order to carry
out the intent of, and to facilitate and effectuate the
actions contemplated by this Agreement.
SIGNATURE PAGE TO CONSULTING AGREEMENT BETWEEN TTI HOLDINGS OF AMERICA, INC.,
AND CROSSOVER ADVISORS, LLC.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first above written.
TTI HOLDINGS OF AMERICA, INC.
By: _________________
Name: Xxxxxx Xxxxxxx
Title: Chairman and Chief Executive Officer
CROSSOVER ADVISORS, LLC
By: __________________
Name:________________
Title: Managing Member
