CONSULTING AGREEMENT
This Consulting Agreement is made effective this 1ST day of September 1995
by and between Canton Financial Services Corporation, a Nevada corporation with
offices at 000 Xxxx 000 Xxxxx, Xxxxx 000, Xxxx Xxxx Xxxx, Xxxx 00000
(hereinafter "Consultant") and HYTK Industries, Inc., a Nevada corporation with
offices at 0000 Xxxxx Xxxxxx Xxxxxxx, Stanford Place III, Suite 201, Denver,
Colorado, 80237 (hereinafter referred to as HYTK or "Client") with respect to
the following:
RECITALS
WHEREAS, Consultant is in the business of providing general business
consulting services to privately held and publicly held corporations; and
WHEREAS, Client desires to retain Consultant to provide advice
relative to corporate and consulting services;
NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements contained herein, and for other good and valuable consideration, the
receipt and adequacy of which is expressly acknowledged, Client and Consultant
agree as follows:
1. Engagement of Consultant.
(a) Consultant agrees to be responsible for taking all steps necessary
to prepare Client for a merger. This includes, but is not limited to,
facilitating efforts to cause Client's corporate status with the state to be in
good standing; restructuring Client's capital formation possibly through reverse
splits, reauthorization of debt and equity; negotiating the settlement of
outstanding debts and lawsuits; preparing financial statements and audits;
preparing and filing other documents with the necessary regulatory bodies as is
required by law, including, but not limited to preparing and filing Forms 10-K
and 10-Q if necessary.
(b) Consultant agrees to prospect for, interview and perform necessary
due diligence on potential merger candidates and to negotiate and structure a
merger with potential candidates.
(c) Consultant agrees to only consider merger candidates that at a
minimum meet NASDAQ listing requirements with respect to gross assets and net
worth.
(d) Consultant further agrees to aid Client in preparation of Client's
15c2-11, and to use its best efforts to recruit market makers in order to
develop a market for Client's stock. Additionally, Consultant agrees to prepare
press releases and corporate fact sheets and to perform other public and
investor relations services in an attempt to develop an active market for
Client's stock.
2. Compensation.
Client shall pay Consultant an hourly fee for the consulting services
provided during the Initial Consulting Period (as defined below) with an option
to convert any amounts due to Consultant for said consulting services into stock
of Client.
Client shall pay as a finders fee 1,025,675 shares or, 51% of the
issued and outstanding shares of the company, whichever is greater, as follows:
Park Street Investments, Inc., shall receive the sum of 102,567 shares; A-Z
Professional Consultants, Inc. shall receive 923,108 shares.
3. Term of Agreement, Extensions and Renewals.
This Agreement shall have an initial term of five years (5) (the
"Initial Consulting Period") from the above date hereon although if the
Consulting Services are completed prior to the expiration of this time period
the agreement may be earlier terminated and the Consultant paid the base fee.
Thereafter, this Agreement can be extended on a month to month basis (the
"Extension Period") by mutual agreement of the parties executed in writing
specifying the compensation for the Extension Period. Such notice shall be in
writing and shall be delivered at least ten (10) days prior to the end of the
Initial Consulting Period or any subsequent extension period. In the event of
termination pursuant to this paragraph, neither party shall have any further
rights or obligations hereunder after the effective date of such termination
except that the obligation of Client to make payments as provided for in this
Agreement and to reimburse costs and expenses shall continue until paid in full
by Client.
4. Nondisclosure of Confidential Information.
In consideration for the Client entering into this Agreement,
Consultant agrees that the following items used in the Clients business are
secret, confidential, unique, and valuable, were developed by Client at great
cost and over a long period of time, and disclosure of any of the items to
anyone other than Client's officers, agents, or authorized employees will cause
Client irreparable injury.
A. Non public financial information, accounting information,
plans of operations, possible mergers or acquisitions prior to
the public announcement;
B. Customer lists, call lists, and other confidential customer
data;
C. Memoranda, notes, records concerning the technical processes
conducted by Client;
D. Sketches, plans, drawings and other confidential research and
development data or;
E. Manufacturing processes, chemical formulae, and/or the
composition of Client's products.
5. Due Diligence.
Client shall supply and deliver to Consultant all information relating
to its business as may be reasonably requested by Consultant to enable
Consultant to make such investigation of Client and its business prospects, and
Client shall make available to Consultant names, addresses and telephone numbers
as Consultant may need to verify or substantiate any such information provided.
6. Best Efforts Basis.
Consultant agrees that it will at all times faithfully and to the best
of its experience, ability and talents, perform all the duties that may be
required of and from Consultant pursuant to the terms of this Agreement.
Consultant does not guarantee that its efforts will have any impact on client's
business or that any subsequent financial improvement will result of
Consultant's efforts. Client understands and acknowledges that the success of
failure of Consultant's efforts will be predicated on Client's assets and
operating results.
7. Costs and Expenses.
Consultant agrees to front all hard costs, however Client agrees that
Consultant shall be reimbursed for these hard costs either in cash or stock,
simultaneously with paying the liabilities currently owed by HYTK. If sufficient
cash is not available to pay both amounts due, Client and Consultant agree to
share the cash on a pro-rata basis, unless otherwise agreed to by the parties.
8. All Prior Agreements Terminated.
This Agreement constitutes the entire understanding of the parties with
respect to the engagement of Consultant, and all prior agreements and
understandings with respect thereto and hereby terminated and shall be of no
force or effect.
9. Consultant is not an Agent or Employee.
Consultant's obligations under this Agreement consist solely of the
Consulting Services described herein. In no event shall Consultant be considered
to act as the employee or agent of Client or otherwise represent or bind Client.
For the purposes of this Agreement, Consultant is an independent contractor. All
final decisions with respect to acts of Client or its affiliates, whether or not
made pursuant to or in reliance on information or advice furnished by Consultant
hereunder, shall be those of Client or such affiliates and Consultant shall
under no circumstances by liable for any expense incurred or loss suffered by
Client as a consequence of such action or decisions.
10. Miscellaneous.
A. Authority. The execution and performance of this Agreement
have been duly authorized by all requisite corporate action.
This Agreement constitutes a valid and binding obligation of
the parties.
B. Amendment. This Agreement may be amended or modified at any
time and in any manner only by an instrument in writing
executed by the parties hereto.
C. Waiver. All the rights and remedies of either party under this
Agreement are cumulative and not exclusive of any other rights
and remedies provided by law. No delay or failure on the part
of either party in the exercise of any right or remedy arising
from a breach of this Agreement shall operate as a waiver of
any subsequent right or remedy arising from a subsequent
breach of this Agreement. The consent of any party where
required hereunder to any act of occurrence shall not be
deemed to be a consent to any other act or occurrence.
D. Assignment:
(i) Neither this Agreement nor any right created by it
shall be assignable by either party without the prior
written consent of the other;
(ii) Nothing in this Agreement, expressed or implied, is
intended to confer upon any person, other than the
parties and their successors, any rights or remedies
under this Agreement.
E. Notices. Any notice or other communication required or
permitted by this Agreement must be in writing and shall be
deemed to be properly given when delivered in person to an
officer of the other party, when deposited in the United
States mails for transmittal by certified or registered mail,
postage prepaid, or when deposited with a public telegraph
company for transmittal or when sent by facsimile
transmission, charges prepared provided that the communication
is addressed:
(i) In the case of BRIA to:
Canton Financial Services Corporation
Attn: Xxxxxx X. Xxxxxxxxxxx
000 Xxxx 000 Xxxxx, Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(ii) In the Case of Consultant to:
HYTK Industries, Inc.
0000 Xxxxx Xxxxxx Xxxxxxx,
Stanford Place III, Suite 201
Xxxxxx, Xxxxxxxx 00000
or to such other person or address designated in writing to
receive notice.
F. Headings and Captions. The headings of paragraphs are included
solely for convenience. If a conflict exists between any
heading and the text of this Agreement, the text shall
control.
G. Entire Agreement. This instrument and the exhibits to this
instrument contain the entire Agreement between the parties
with respect to the transaction contemplated by the Agreement.
It may be executed in any number of counterparts but the
aggregate of the counterparts together constitute only one and
the same instrument.
H. Effect of Partial Invalidity. In the event that any one or
more of the provisions contained in this Agreement shall for
any reason be held to be invalid, illegal, or unenforceable in
any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Agreement, but
this Agreement shall be constructed as if it never contained
any such invalid, illegal or unenforceable provisions.
I. Controlling Law and Venue. The validity, interpretation, and
performance of this Agreement shall be controlled by and
construed under the laws of the State of Utah, the state in
which this Agreement is being executed.
J. Attorney's Fees. If any action at law or in equity, including
an action for declaratory relief, is brought to enforce or
interpret the provisions of this Agreement, the prevailing
party shall be entitled to recover actual attorney's fees from
the other party. The attorney's fees may be ordered by the
court in the trial of any action described in this paragraph
or may be enforced in a separate action brought for
determining attorney's fees.
K. Time is of the Essence. Time is of the essence of this
Agreement and of each and every provision hereof.
L. Mutual Cooperation. The parties hereto shall cooperate with
each other to achieve the purpose of this Agreement, and shall
execute such other and further documents and take such other
and further actions as may be necessary or convenient to
effect the transactions described herein.
M. Further Actions. At any time and from time to time, each party
agrees, at its or their expense, to take actions and to
execute and deliver documents as may be reasonably necessary
to effectuate the purposes of this Agreement.
N. Indemnification. Client agrees to indemnify, defend and hold
Consultant harmless from and against all demands, claims,
actions, losses, damages, liabilities, costs and expenses,
including without limitation, interest, penalties and
attorneys' fees and expenses asserted against or imposed or
incurred by either party by reason of or resulting from a
breach of any representation, warranty, covenant condition or
agreement of the other party to this Agreement.
O. No Third Party Beneficiary. Nothing in this Agreement,
expressed or implied, is intended to confer upon any person,
other than the parties hereto and their successors, any rights
or remedies under or by reason of this Agreement, unless this
Agreement specifically states such intent.
P. Facsimile Counterparts. If a party signs this Agreement and
transmits an electronic facsimile of the signature page to the
other party, the party who receives the transmission may rely
upon the electronic facsimile as a signed original of this
Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date herein
above written.
HYTK INDUSTRIES, INC. CANTON FINANCIAL SERVICES CORPORATION
By: /s/Xxxxxx Xxxxxxxxx By: /s/ Xxxxxx Xxxxxxxxxxx
Xxxxxx Xxxxxxxxx, President Xxxxxx Xxxxxxxxxxx, President
