Exhibit 10.3
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT (this "Agreement") is made and entered into
effective as of this 31st day of March, 2005, by and between Federal Mortgage
Corp of Puerto Rico, Inc., a Delaware corporation (the "Company"), and Xxxxxxx
X. Xxxxxxxxxx (the "Consultant").
WITNESSETH:
WHEREAS, the Company desires to engage the Consultant to provide certain
legal advisory services to the Company; and
WHEREAS, the Company and the Consultant intend that this Agreement and
the services to be performed hereunder shall be a "written compensation
contract" within the meaning of Rule 405 under the Securities Act of 1933, as
amended ("Securities Act"), pursuant to which the Company will issue shares of
its common stock, $.0001 par value per share, as compensation for services
rendered by the Consultant to the Company pursuant to a registration statement
under the Securities Act on Form S-8 to be filed by the Company with the
Securities and Exchange Commission ("SEC").
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set
forth herein, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged by the parties, it is agreed as
follows:
1. APPOINTMENT
The Company hereby engages Consultant to provide certain administrative
services to the Company in connection with its transition following the
business combination with Pride Lending, Inc. The services will be performed
at the request of management of the Company and to its satisfaction. The
services hereunder will be personally rendered by Consultant. None of the
services rendered by Consultant and paid for by the issuance of shares of
common stock of the Company shall be services related to any "capital raising"
transaction as such item is used in Rule 405 under the Securities Act.
2. TERM
The term of this Agreement shall commence on the date of the execution
hereof and shall automatically terminate on April 15, 2005, unless sooner
terminated pursuant to the provisions hereof.
3. INDEPENDENT CONTRACTOR
Consultant shall be an independent contractor with regard to the Company
and Consultant shall be responsible and liable for all withholding taxes,
FICA, or other similar taxes or charges with regard to the compensation to be
paid or issued hereunder. Consultant shall indemnify and hold the Company
harmless for the payment of all such withholding taxes and charges.
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4. COMPENSATION
(a) For all services hereunder, the Company agrees to pay Consultant a
fee by the issuance of 150,000 shares of its common stock, $.0001 par value
per share, provided that such shares of common stock shall be issued pursuant
to and shall be subject to the filing with the SEC and effectiveness of a
Registration Statement on Form S-8 covering such shares. Subject to the
effectiveness of the Form S-8 Registration Statement covering the fee to be
paid hereunder, one or more certificates shall be issued to the Consultant at
such address as the Consultant shall provide to the Company.
5. CONFIDENTIAL INFORMATION
(a) During the term of this Agreement, the Company may disclose certain
Confidential Information (as hereinafter defined) to Consultant for the
purpose of enabling Consultant to perform certain services under this
Agreement for the Company. Consultant and his employees, agents and
representatives shall not disclose to any other individual, partnership,
corporation or entity of any kind, other than authorized employees of the
Consultant (who shall agree to be bound by the confidentiality provisions of
this Agreement), or, use or exploit any and all Confidential Information of
the Company for any purpose or activity other than as necessary to perform his
obligations under, or as expressly contemplated by, this Agreement.
Consultant agrees to keep such information confidential by using the same care
and discretion that he uses with his own Confidential Information.
Confidential Information may be communicated orally, in writing, or in any
other recorded or tangible form. For purposes of this Agreement,
"Confidential Information" shall include all material and information of a
proprietary nature relating to the Company's present business and business
relationships, the development of its business and/or proposed business,
including but not limited to confidential information concerning the Company's
products, methods, engineering designs and standards, trade secrets,
analytical techniques, technical information, pricing practices, costs, profit
margins, customer information, marketing practices, employee information and
similar items of the Company. Consultant also agrees that this duty extends
to information regarding all financial, technical, and other related matters
to which the Company might have access, directly or indirectly. All
information relating to the Company shall be presumed to be Confidential
Information unless it falls within one of the classes of information that is
freely disclosable under subsection (b) below.
(b) The provisions of this Section 5 shall not apply or shall cease to
apply to data and information supplied by the Company to Consultant if it was
already known to Consultant; or has come into the public domain without breach
of confidence by Consultant or any other person; or is required to be
disclosed pursuant to any statutory requirement or court order.
6. MISCELLANEOUS.
(a) Termination. This Agreement may be terminated by: (i) the mutual
agreement of the Company and Consultant; (ii) by either party hereto if there
has been a material misrepresentation by the other party hereto or a material
breach of this Agreement by such other party; (iii) by the Company in the
event any action is commenced by the SEC or any state securities commission
against Consultant or any entity controlled by, or under common control with,
Consultant; or (iv) at any time by either party, for any reason, on not less
than 30 days prior written notice to the other party; provided that Consultant
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shall be entitled to receive as compensation for all services hereunder all of
the shares set forth in Section 4 of this Agreement and further that the
services performed by Consultant prior to the effective date of any such
termination will be deemed sufficient to entitle Consultant to such full
compensation.
(b) Entire Agreement; Amendment. This Agreement sets forth the entire
understanding of the parties with respect to the subject matter hereof. This
Agreement may be amended only in writing signed by both parties.
(c) Notices. Any notice, consent, waiver, or other communication
required or permitted to be given hereunder must be in writing and will be
deemed to have been delivered personally: (i) upon receipt, when delivered
personally; (ii) three (3) days after being sent by U.S. certified mail,
return receipt requested; or (iii) one (1) day after deposit with a nationally
recognized overnight delivery service, in each such case properly addressed to
the party to receive the same. The addresses for such communications shall
be:
Company: Federal Mortgage Corp of Puerto Rico, Inc.
000 Xxxx Xxxxxx Xxx
Xxxxxxxxxx, XX 00000
Tel: (000) 000-0000
Consultant: Xxxxxxx X. Xxxxxxxxxx
0000 Xxxxxxxxx Xxxxxx, Xxxxx 0X
Xxxxxx, XX 00000
(d) Waiver. Any waiver by either party of a breach of any provision of
this Agreement shall not operate or be construed to be a waiver of any other
breach of that provision or of any breach of any other provision of this
Agreement. The failure of a party to insist upon strict adherence to any term
of this Agreement on one or more occasions will not be considered a waiver or
deprive that party of the right thereafter to insist upon adherence to that
term of any other term of this Agreement.
(e) Assignment. This Agreement may not be assigned by the Consultant
for any reason.
(f) Severability. If any provision of this Agreement is held to be
invalid, illegal, or unenforceable, the balance of this Agreement shall remain
in effect and, if any provision is inapplicable to any person or circumstance,
it shall nevertheless remain applicable to all other persons and
circumstances.
(g) Arbitration. Any dispute or other disagreement arising from or out
of this Agreement or any claim by Consultant as a present or former
stockholder or security holder of the Company shall be submitted to binding
arbitration under the Federal Arbitration Act in accordance with the
commercial arbitration rules of the American Arbitration Association and the
decision of the arbiter(s) shall be enforceable in any court having
jurisdiction thereof. In arbitration proceedings under this subsection (g),
the parties shall be entitled to any and all remedies that would be available
in the absence of this subsection (g) and the arbitrators, in rendering their
decision, shall follow the substantive laws that would otherwise be
applicable. Arbitration shall occur only in Washington D.C. In the event any
dispute is arbitrated, the prevailing party (as determined by the arbiter(s))
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shall be entitled to recover that Party's reasonable attorney's fees incurred
(as determined by the arbiter(s)). Notwithstanding the foregoing, in order to
preserve the status quo pending the resolution by arbitration of a claim
seeking relief of an injunctive or equitable nature, any party, upon
submitting a matter to arbitration as required by this subsection (g), may
simultaneously or thereafter seek a temporary restraining order or preliminary
injunction from a court of competent jurisdiction pending the outcome of the
arbitration.
(h) Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the Commonwealth of Virginia, without regard to
the conflict of law provisions of such state. Signed facsimile copies of
this Agreement shall be valid and binding upon the parties hereto.
(i) Counterparts. This Agreement may be executed simultaneously in
several counterparts, each of which shall be deemed an original, but all of
which together will constitute one and the same document.
(j) Headings. The section and subsection headings in this Agreement
are inserted for convenience only and shall not affect in any way the meaning
or interpretation of this Agreement.
(k) Further Assurances. At any time and from time to time after the
execution hereof, Consultant shall execute such additional documents or
instruments and take such action as may be reasonably requested by the Company
to carry out the intent and purpose of this Agreement, and furnish such
additional information as shall be deemed necessary by the Company or its
counsel in connection with the filing by the Company of the Form S-8
registration statement contemplated by Section 4 hereinabove.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective as of the date first above written.
FEDERAL MORTGAGE CORP XXXXXXX X. XXXXXXXXXX
OF PUERTO RICO, INC. (THE "CONSULTANT)
(THE "COMPANY")
By: /s/ Xxxxx X. Xxxxxx Signed: /s/ Xxxxxxx X. Xxxxxxxxxx
Its Vice President Name: Xxxxxxx X. Xxxxxxxxxx
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