EXECUTION COPY
EXHIBIT 10.3
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ADMINISTRATIVE SERVICES AGREEMENT
This Administrative Services Agreement (the "Agreement") is entered into
this 6th day of January, 2006 by and between iVoice, Inc., a New Jersey
corporation, with its principal office at 000 Xxxxx 00, Xxxxxxx, XX, 00000
("iVoice"), and Xxxxxx Pharmaceuticals, Ltd. (f/k/a iVoice Acquisition Corp.), a
New Jersey corporation, with its principal office at 000 Xxxxx 00, Xxxxxxx, XX,
00000 (the "Company").
The Company is a wholly owned subsidiary of iVoice and has relied since its
inception upon various administrative services provided by iVoice.
The Company desires to engage iVoice to continue after the date hereof to
provide certain administrative services hereinafter described (the "Services"),
and iVoice desires to provide the Services, on the terms and subject to the
conditions hereinafter set forth.
The Company is party to an agreement and plan of merger, dated January __,
2006 among the iVoice, the Company, Xxxxxx Pharmaceuticals, Ltd., a New York
corporation ("TPL"), and certain shareholders named therein (the "Merger
Agreement"), pursuant to which, on even date herewith, TPL will merge (the
"Merger") with and into the Company;
It is the intention of the parties to this agreement that upon the
consummation of the Merger, the Surviving Corporation (as defined in the Merger
Agreement) shall be bound and obligated to this Agreement as the successor in
interest to the Company;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein set forth, the parties hereto agree as follows:
1. SERVICES
1.1 During the term of this Agreement, iVoice shall provide the following
Services to the Company:
a. Contract review
b. Issuing sales orders
c. Invoicing
d. Collections
e. Review inventory records, warehousing reports, etc.
f. Manage employee records
g. Process payroll
h. Manage insurance coverages (health, liability, etc)
i. Accounts Payable
j. Accounts Receivable
k. Expense reimbursement
l. Vendor payments
m. Manage cash accounts
n. Maintain accounting records
o. Prepare periodic tax filings
p. Manage quarterly review and year-end audit in conjunction with
outside auditors
1.2 iVoice shall perform the Services in a timely and efficient manner, in
accordance with all applicable laws, regulations and ordinances, and shall
assign to each of the Services substantially the same priority as assigned to
services of like category performed in its own operations.
1.3 The parties agree that the Shareholder Representative (as defined in
that certain Agreement and Plan of Merger, dated January __ 2006 among iVoice,
the Company, iVoice Acquisition Corp and certain shareholders named therein)
shall be deemed a third party beneficiary for the limited purpose of enforcing
the Company's rights hereunder. Notwithstanding the foregoing, in the event that
iVoice shall cease to control a majority of the voting securities of the
Company, such Shareholder Representative shall no longer be deemed a third party
beneficiary hereunder.
2. TERM
2.1 The term of this Agreement shall commence at the date hereof, and shall
continue until the second anniversary thereof, unless earlier terminated or
extended in accordance with the provisions of this Section 2.
2.2 The term of this Agreement may be extended for up to two additional
one-year periods upon written notice from the Company to iVoice at least 30 days
prior to the scheduled expiration thereof and in consideration for the Services
thereunder, the Company shall issue to iVoice an additional Debenture (as
defined in Section 3 hereof) in the principal amount of $50,000 for each such
additional one-year period.
2.3 This Agreement may be terminated, and any one or more of the Services
may be reduced in scope or eliminated in its entirety, at any time during the
term hereof upon 90 days' prior written notice from the Company to iVoice.
2.4 In the event that the Company shall consummate an initial public
offering ("IPO") of its Common Stock (as defined herein) this Agreement shall
terminate on the closing date of such IPO with immediate effect.
3. FEES
In consideration for the Services, the Company shall issue to iVoice an
Administrative Service Convertible Debenture (the "Debenture") in the amount of
$100,000 in the form attached as an exhibit to this Agreement. The Debenture
shall have a term of seven (7) years, and shall bear interest at ten percent
(10%) per annum. Both principal and interest shall be due at the end of the
term. The Debenture shall also be convertible in accordance with its term
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into
shares of the Company's Class A Common Stock ("Common Stock")at the price per
share equal to an amount equal to eighty percent (80%) of the lowest closing bid
price of the Common Stock for the five (5) trading days immediately preceding
the Conversion Date (as defined therein), once the Company is listed on a either
The National Association of Securities Dealers Inc.'s Over-The-Counter Bulletin
Board, Nasdaq SmallCap Market, or American Stock Exchange, or such other
principal stock exchange. The holders of the Debenture shall also have
registration rights for the shares underlying the Debenture.
4. OBLIGATIONS AND RELATIONSHIP
Both parties to this Agreement shall at all times act as independent
contractors and, notwithstanding anything contained herein, the relationship
established hereunder between the parties shall not be construed as a
partnership, joint venture or other form of joint enterprise. Except as
expressly authorized by a party hereto, no party shall be authorized to make any
representations or to create or assume any obligation or liability in respect of
or on behalf of the other party, and this Agreement shall not be construed or
constituting either party or the agent of the other party.
5. LIMITED LIABILITY; INDEMNIFICATION
5.1 iVoice shall not be liable to the Company for any loss, claim, expense
or damage, including indirect, special, consequential or exemplary damages, for
any act or omission performed or omitted by it hereunder so long as its act or
omission does not constitute fraud, bad faith or gross negligence. iVoice shall
not be liable to the Company for the consequences of any failure or delay in
performing any Services if the failure shall be caused by labor disputes,
strikes or other events or circumstances beyond its control and it shall have
provided prompt notice to the Company of its inability to perform Services and
the reason therefor.
5.2 In any action, suit or proceeding (other than an action by or in the
right of the Company) to which iVoice or any agent or employee of iVoice
performing Services hereunder (an "Indemnitee") was or is a party by reason of
his or its performance or non-performance of Services, the Company shall
indemnify the Indemnitee and hold the Indemnitee harmless from and against
expenses, judgments, fines and amounts paid (with the consent of the Company) in
settlement actually and reasonably incurred by the Indemnitee in connection
therewith if the Indemnitee acted in good faith and provided that the
Indemnitee's conduct does not constitute negligence or misconduct.
6. CONFIDENTIALITY
Any and all information obtained by iVoice in connection with the Services
contemplated by this Agreement shall be held in the strictest confidence and not
disclosed to any other person without the prior written consent of the Company.
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7. NOTICES
All notices or other communications required or permitted to be given
pursuant to this Agreement shall be in writing and shall be considered as duly
given on: (a) the date of delivery, if delivered in person against written
receipt therefor, or by nationally recognized overnight delivery service or (b)
five (5) days after mailing if mailed from within the continental United States
by postage pre-paid certified mail, return receipt requested to the party
entitled to receive the same:
If to iVoice: iVoice, Inc.
000 Xxxxx 00
Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxx
Telephone: 000-000-0000
Facsimile: 000-000-0000
And if to the Company: Xxxxxx Pharmaceuticals, Ltd.
c/o iVoice, Inc.
000 Xxxxx 00
Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxx
Telephone: 000-000-0000
Facsimile: 000-000-0000
Any party may change its address by giving notice to the other party
stating its new address. Commencing on the tenth (10th) day after the giving of
such notice, such newly designated address shall be such party's address for the
purpose of all notices or other communications required or permitted to be given
pursuant to this Agreement.
8. BINDING EFFECT
This Agreement and all of the provisions hereof shall be binding upon and
inure to the benefit of the parties and their respective successors.
9. NO THIRD PARTY BENEFICIARIES
This Agreement is solely for the benefit of the parties hereto and shall
not confer upon third parties and remedy, claim, cause of action or other right
in addition to those existing without reference to this Agreement.
10. ENTIRE AGREEMENT
This Agreement constitutes the entire agreement between the parties with
respect to the subject matters covered hereby and supersedes any prior agreement
or understanding between the parties with respect to those matters.
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11. ASSIGNMENT; AMENDMENT; WAIVER
This Agreement is not assignable, except that upon the consummation of the
Merger, the rights and obligations of the Company shall inure to the Surviving
Corporation as successor in interest to the Company. Except as provided in the
immediately prior sentence, neither the rights nor the duties arising hereunder
may be assigned or delegated. This Agreement may not be amended nor may any
rights hereunder be waived except by an instrument in writing signed by the
party sought to be charged with the amendment or waiver. The failure of a party
to insist upon strict adherence to any term of this Agreement on any occasion
shall not be considered a waiver or deprive that party of the right thereafter
to insist upon strict adherence to that term or any other term of this
Agreement.
12. GOVERNING LAW
This Agreement shall be construed in accordance with and governed by the
laws of the State of New Jersey, without giving effect to the provisions,
policies or principles thereof relating to choice or conflict of laws.
13. HEADINGS
The section and other headings contained in this Agreement are for
reference purposes only and shall not affect the meaning or interpretation of
this Agreement.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the day and year first above written.
IVOICE, INC.
By: ______________________
Xxxxx Xxxxxxx
President
XXXXXX PHARMACEUTICALS, LTD.
By: ______________________
Xxxxx Xxxxxxx
President
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EXHIBIT
FORM OF DEBENTURE
