Exhibit 4.1
CONSULTING AND MARKETING LICENSE AGREEMENT
THIS CONSULTING AND MARKETING LICENSE AGREEMENT (this "Agreement") is
between Xxxx Xxxxxxx (the "Consultant") and Raven Moon Entertainment, Inc. (the
"Company"). Each of the Consultant and the Company are also referred to in this
agreement as the "Parties."
WHEREAS, the Company intends to develop a market for the Company's products
and services offered from time to time by the Company (the "Products and
Services") for potential customers of the Products and Services who are racing
car enthusiasts; and
WHEREAS, the Consultant is a professional race car driver with name
recognition in the racing car industry; and
WHEREAS, the Company desires to utilize the services of the Consultant to
promote and develop a market for the Company's Products and Services; and
WHEREAS, in connection with the services to be provided by the Consultant
pursuant to this Agreement, the Company desires to grant the Consultant a
non-exclusive license for the limited use of the Company's tradename, trademark
or logo, or any other tradename, trademark or logo of the Company, as may be
agreed upon by the Parties (the "Licensed Trademarks").
NOW THEREFORE, in consideration of the premises and mutual covenants set
forth in this Agreement, the Parties hereby agree as follows:
1. Scope of Services. The Company hereby retains the Consultant to promote
and develop a market for the Products and Services. The Consultant agrees to use
his best efforts during the term of this Agreement to market and promote the
Products and Services.
2. Term. This Agreement shall become effective as of the date set forth on
the signature page of this Agreement, and shall continue for a period of one (1)
year (the "Term"). Notwithstanding the foregoing, the Company or the Consultant
shall be entitled to terminate this Agreement for "cause" upon 30 days' written
notice, which written notice shall be effective upon mailing by first class mail
accompanied by facsimile transmission to the Consultant at the address and
telecopier number last provided by the Consultant to the Company. "Cause" shall
be determined solely as to the violation of any rule or regulation of any
regulatory agency, and other neglect, act or omission detrimental to the conduct
of Company or the Consultant's business, material breach of this Agreement or
any unauthorized disclosure of any of the secrets or confidential information of
Company, and dishonesty related to independent contractor status.
3. Grant of Non-exclusive License. Subject to the terms of this Agreement,
the Company hereby grants to the Consultant, and the Consultant hereby accepts,
the non-exclusive license to use the Licensed Trademarks on the Consultant's
racing cars, and on the Consultant's racing equipment and clothing, which shall
be operated by the Consultant in professional racing car competitions at the
sole of discretion of the Consultant.
(a) During the Term of this Agreement, the Consultant shall not
negotiate or enter into any license, sub-license, agreement of
sub-contract, assignment, or similar agreement with any third parties in
respect of the Licensed Trademarks, or any right or interest granted by the
Company to the Consultant pursuant to this Agreement, and the Consultant
shall further refrain from directly or indirectly, on his own behalf,
licensing, sub-licensing, assigning, or sub-contracting the Licensed
Trademarks, or other right or interest granted by the Company to the
Consultant to such third parties without the Company's prior written
consent.
(b) No license or right is granted by the Company to the Consultant,
either expressly or by implication, under any licenses or rights owned or
controlled by the Company, except as expressly set forth in this Agreement.
(c) The license granted pursuant to this Agreement shall expire
simultaneously with the Term of this Agreement, and shall be revocable at
will by the Company upon written notice to the Consultant, and the
Consultant shall immediately refrain from the use of any rights granted by
the Company to the Consultant with respect to this license upon receipt of
such written notice.
4. Compensation; Grant of Stock Option. In consideration for the services
to be provided by the Consultant to the Company under the terms of this
Agreement, the Company agrees to grant to the Consultant upon the execution of
this Agreement a non-qualified stock option (the "Option") to purchase up to the
number of shares (the "Shares") of the Company's common stock (the "Common
Stock") as set forth below, which shall vest and be exercisable at the prices
and on the terms set forth below:
Number of Shares or Total Dollar Amount: $1,080,000
Exercise Price per Share: 70% of the average of the closing "bid" price for
the ten (10) trading days immediately preceding the date of exercise of the
option.
Vesting Schedule: $180,000 in option shares shall vest immediately
following the execution and delivery of this Agreement. Thereafter, $180,000 in
option shares shall vest on and as of the 1st day of each of the five (5)
consecutive, successive months thereafter, beginning on June 1, 2002.
Floor Price: In no event may any Option Shares be exercised or purchased
for a price less than $0.04 per share.
Expiration of Options: Any options that remain unexercised as of the
termination of this Agreement or the expiration of the Term shall automatically
and immediately expire and no longer be of any force or effect.
Detailed terms of the Option shall be set forth in the form of Non-Qualified
Stock Option Agreement between the Company and the Consultant, substantially in
the form attached as Exhibit A to this Agreement. The Company agrees to register
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the Shares promptly after signing of this agreement for resale under the
Securities Act of 1933, as amended, pursuant to a registration statement filed
with the Securities and Exchange Commission on Form S-8 (or, if Form S-8 is not
then available, such other form of registration statement available), pursuant
to the terms of such registration set forth in the Non-Qualified Stock Option
Agreement.
5. Confidentiality. The Consultant covenants that all information
concerning the Company, including proprietary information, which it obtains as a
result of the services rendered pursuant to this Agreement shall be kept
confidential and shall not be used by the Consultant except for the direct
benefit of the Company nor shall the confidential information be disclosed by
the Consultant to any third party without the prior written approval of the
Company, provided, however, that the Consultant shall not be obligated to treat
as confidential, or return to the Company copies of any confidential information
that (i) was publicly known at the time of disclosure to Consultant, (ii)
becomes publicly known or available thereafter other than by any means in
violation of this Agreement or any other duty owed to the Company by the
Consultant, or (iii) is lawfully disclosed to the Consultant by a third party.
6. Independent Contractor. The Consultant and the Company hereby
acknowledge that the Consultant is an independent contractor. The Consultant
agrees not to hold himself out as, nor shall he take any action from which
others might reasonably infer that the Consultant is a partner or agent of, or a
joint venturer with the Company. In addition, the Consultant shall take no
action, which, to the knowledge of the Consultant, binds, or purports to bind,
the Company to any contract or agreement.
7. Miscellaneous.
(a) Entire Agreement. This Agreement contains the entire agreement
between the Parties, and may not be waived, amended, modified or
supplemented except by agreement in writing signed by the Party against
whom enforcement of any waiver, amendment, modification or supplement is
sought. Waiver of or failure to exercise any rights provided by this
Agreement in any respect shall not be deemed a waiver of any further or
future rights.
(b) Governing Law. This Agreement shall be construed under the
internal laws of the State of New York, and the Parties agree that the
exclusive jurisdiction for any litigation or arbitration arising from this
Agreement shall be in New York City, N.Y.
(c) Successors and Assigns. This Agreement shall be binding upon the
Parties, their successors and assigns, provided, however, that the
Consultant shall not permit any other person or entity to assume these
obligations hereunder without the prior written approval of the Company,
which approval shall not be unreasonably withheld and written notice of the
Company's position shall be given within ten (10) days after approval has
been requested.
(d) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but which when
taken together shall constitute one agreement.
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(e) Severability. If one or more provisions of this Agreement are held
to be unenforceable under applicable law, such provision(s) shall be
excluded from this Agreement and the balance of this Agreement shall be
interpreted as if such provision were excluded and shall be enforceable in
accordance with its terms.
(Signature Page Follows)
IN WITNESS WHEREOF, the Parties hereto have executed or caused this
Agreement to be executed as of the date set forth below.
Date: CONSULTANT:
---------------------
-----------------------------------
Xxxx Xxxxxxx
Address for Notices:
X.X. 0000
Xxxxxxx, Xx
00000
COMPANY:
Raven Moon Entertainment, Inc.
By: /s/
--------------------------------
Xxxx XxXxxxxxxxx, CEO
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EXHIBIT A
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FORM OF
NON-QUALIFIED STOCK OPTION AGREEMENT
THIS NON-QUALIFIED STOCK OPTION AGREEMENT (this "Agreement") is between
Xxxx Xxxxxxx (the "Grantee") and Raven Moon Entertainment, Inc. (the "Company").
Each of the Grantee and the Company are also referred to in this agreement as
the "Parties."
WHEREAS, the Board of Directors of the Company (the "Board of Directors")
has authorized the grant to the Grantee, for services to be rendered by the
Grantee as a consultant to the Company pursuant to the terms of a Consulting and
Marketing License Agreement of even date herewith (the "Consulting Agreement")
between the Company and the Grantee, of a non-qualified stock option (the
"Option") to purchase up to the number of shares of the Company's common stock
(the "Common Stock") specified in paragraph 1 of this Agreement, at the prices
specified in paragraph 1 of this Agreement.
NOW THEREFORE, in consideration of the premises and mutual covenants set
forth in this Agreement, the Parties hereby agree as follows:
1. Number of Shares; Exercise Price. Pursuant to action taken by the Board
of Directors, the Company hereby grants to the Grantee, in consideration of
consulting services to be performed for the benefit of the Company pursuant to
the Consulting Agreement, an option ("Option") to purchase the number of shares
("Option Shares") of the Company's Common Stock set forth below, at the exercise
price and terms set forth below:
Number of Shares: $1,080,000 in total share value, divided by the Exercise
Price at each applicable exercise date.
Exercise Price per Share: 70% of the average of the closing "bid" price for
the ten (10) trading days immediately preceding the date of exercise of the
option.
Vesting Schedule: $180,000 in Option Shares shall vest immediately
following the execution and delivery of this Agreement. Thereafter, $180,000 in
Option Shares shall vest on and as of the 1st day of each of the five (5)
consecutive, successive months thereafter, beginning on June 1, 2002. Each
vested tranche of Option Shares shall remain exercisable for a period of thirty
(30) days after vesting, following which they shall expire.
Floor Price: In no event may any Option Shares be exercised or purchased
for an amount less than $0.04 per share.
Expiration of Options: Any options that remain unexercised as of the
termination of this Agreement shall automatically and immediately expire and no
longer be of any force or effect.
2. Term. The Options and this Agreement shall expire one year from the date
of this Agreement.
3. Shares Subject To Exercise. The Option shall be exercisable and shall
remain exercisable as set forth in Paragraph 1 of this Agreement.
4. Method and Time of Exercise. The Option may be exercised as to vested
Option Shares in whole or in part by written notice delivered to the Company
stating the number of Option Shares with respect to which the Option is then
being exercised, together with a check and/or a wire transfer made payable to
the Company in the amount equal to the Exercise Price multiplied by the number
of Option Shares then being issued pursuant to the written notice of exercise,
plus the amount of applicable federal, state and local withholding taxes,
provided, however, that such taxes may be satisfied by the withholding of Option
Shares then issuable upon the exercise of the Option pursuant to paragraph 5 of
this Agreement. Not less than one hundred (100) Option Shares may be purchased
upon exercise of the Option at any one time unless the number of Option Shares
for which exercise of the Option is being made is all of the Option Shares then
issuable upon exercise of the Option. Only whole shares shall be issued upon
exercise of the Option.
5. Tax Withholding. As a condition to exercise of the Option, the Company
may require the Grantee to pay to the Company all applicable federal, state and
local taxes which the Company is required to withhold with respect to the
exercise of the Option.
6. Transferability. The Option and this Agreement may not be assigned or
transferred except by will or by the laws of descent and distribution, and with
prior written consent of the Company.
7. Grantee Not a Shareholder. The Grantee shall have no rights as a
shareholder with respect to the Option Shares issued from time to time upon
exercise of the Option until the earlier of: (1) the date of issuance of a stock
certificate or stock certificates to the Grantee applicable to the Option Shares
then issuable to the Grantee upon exercise of the Option and (2) the date on
which the Grantee or his nominee is recorded as owner of such Option Shares on
the Company's stock ledger by the Company's registrar and transfer agent, which
may be the Company. Except as set forth in paragraph 12 of this Agreement, no
adjustment will be made for dividends or other rights for which the record date
is prior to the earlier of the events described in clauses (1) and (2) of this
paragraph.
8. Restrictions on Transfer. The Grantee represents and agrees that, upon
the Grantee's exercise of the Option, in whole or in part, unless there is in
effect at that time under the Securities Act of 1933 a registration statement
relating to the Option Shares, the Grantee will acquire the Option Shares for
the purpose of investment and not with a view to their resale or further
distribution, and that upon such exercise hereof, the Grantee will furnish to
the Company a written statement to such effect, satisfactory to the Company in
form and substance.
9. Shares Qualified for Listing. Company represents that its Common Stock
is qualified for trading or quotation on a nationally recognized securities
exchange or stock quotation system, including, the NASDAQ Bulletin Board.
10. Registration Rights. Promptly after this Agreement has been fully
signed, the Company shall, at the Company's expense, file with the Securities
and Exchange Commission ("SEC") a registration statement ("Registration
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Statement") on Form S-8, or if such form is not then available, such other form
of registration statement then available, in such form as to comply with
applicable federal and state laws for the purpose of registering or qualifying
the Option Shares for public resale by the Consultant.
11. Notices. All notices to the Company shall be addressed to the Company
at the principal office of the Company at the address and facsimile number set
forth on the signature page of this Agreement, and all notices to the Grantee
shall be addressed to the Grantee at the address and facsimile number of the
Grantee set forth on the signature page of this Agreement or, if different, the
last address and facsimile number on file with the Company, or to such other
address and facsimile number as either may designate to the other in writing. A
notice shall be deemed to be duly given if and when enclosed in a properly
addressed sealed envelope deposited, postage prepaid and followed by facsimile
to the addressee. In lieu of giving notice by mail as aforesaid, written notices
under this Agreement may be given by personal delivery to the Grantee or to the
Company (as the case may be) by nationally recognized courier or overnight
delivery service.
12. Adjustments. If there is any change in the capitalization of the
Company after the date of this Agreement affecting in any manner the number of
kind of outstanding shares of Common Stock of the Company, whether by stock
dividend, stock split, reclassification or recapitalization of such stock, or
because the Company has merged or consolidated with one or more other
corporations (and provided the Option does not thereby terminate pursuant to
paragraph 13 of this Agreement), then the number and kind of shares then subject
to the Option and the exercise price to be paid for the Option Shares shall be
appropriately adjusted by the Board of Directors; provided however, that in no
event shall any such adjustment result in the Company being required to sell or
issue any fractional shares. Any such adjustment shall be made without change in
the aggregate exercise price applicable to the unexercised portion of the
Option, but with an appropriate adjustment to the exercise price of each Option
Share or other unit of security then covered by the Option and this Agreement.
13. Cessation of Corporate Existence. Notwithstanding any other provision
of this Agreement, in the event of the reorganization, merger or consolidation
of the Company with one or more corporations as a result of which the Company is
not the surviving corporation, or the sale of substantially all the assets of
the Company or of more than fifty percent (50%) of the then outstanding stock of
the Company to another corporation or other entity in a single transaction, the
Option grated hereunder shall terminate, provided however, that not later than
five (5) days before the effective date of such merger or consolidation or sale
of assets in which the Company is not the surviving corporation, the surviving
corporation may, but shall not be so obligated to, tender to the Grantee an
option to purchase a number of shares of capital stock of the surviving
corporation equal to the number of Option Shares then issuable upon exercise of
the Option, and such new option or options for shares of the surviving
corporation shall contain such terms, conditions and provisions as shall be
required substantially to preserve the rights and benefits of the Option and
this Agreement.
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14. Miscellaneous.
(a) Entire Agreement. This Agreement and the Consulting Agreement
contain the entire agreement between the Parties and may not be waived,
amended, modified or supplemented except by agreement in writing signed by
the Party against whom enforcement of any waiver, amendment, modification
or supplement is sought. Waiver of or failure to exercise any rights
provided by this Agreement and the Consulting Agreement in any respect
shall not be deemed a waiver of any further or future rights.
(b) Governing Law. This Agreement shall be construed under the
internal laws of the State of New York, and the Parties agree that the
exclusive jurisdiction for any litigation or arbitration arising from this
Agreement shall be in New York City, N.Y.
(c) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but which when
taken together shall constitute one agreement.
(d) Severability. If one or more provisions of this Agreement are held
to be unenforceable under applicable law, such provision(s) shall be
excluded from this Agreement and the balance of this Agreement shall be
interpreted as if such provision were excluded and shall be enforceable in
accordance with its terms.
(Signature Page Follows)
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IN WITNESS WHEREOF the Parties hereto have executed this Agreement as of
the date set forth below.
Date: OPTIONEE:
----------------------
/s/
-----------------------------------
Xxxx Xxxxxxx
Address for Notices:
X.X. Xxx 0000
-----------------------------------
Ketchum, Id.
-----------------------------------
83340
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COMPANY:
Raven Moon Entertainment, Inc.
By: /s/
--------------------------------
Xxxx XxXxxxxxxxx, CEO
Address for Notices:
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