CONSULTING AGREEMENT
This Consulting Agreement (the "Agreement") is made and entered into this
1st day of March 2006, by and between Gateway Distributors, Ltd., a Nevada
corporation ("GWDB"), whose principal place of business is 0000 Xxxxxx Xxxx,
Xxx Xxxxx, Xxxxxx 00000, and Xxxxx Xxxxxx (the "Consultant") at 000 Xxxx Xxxxx
Xxxxxxxx Xxx, Xxx Xxxxx, Xxxxxx 00000.
RECITALS
WHEREAS, Consultant is willing and capable of providing on a "best efforts"
basis various mergers and acquisition, feasibility, fairness opinions, legal
services and management services for and on behalf of GWDB in connection with
GWDB's mergers and acquisition projects, joint ventures, strategic alliances and
in connection with GWDB's compliance with state and Federal securities laws and
regulations; and
WHEREAS, GWDB desires to retain the Consultant as an independent Consultant
to provide the above-described consulting services, and the Consultant desires
to be retained in that capacity upon the terms and conditions hereinafter set
forth.
NOW THEREFORE, in consideration of the mutual promises and agreements
hereinafter set forth, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
CONSULTING SERVICES. GWDB hereby retains the Consultant as an independent
Consultant to GWDB and the Consultant hereby accepts and agrees to such
retention. The Consultant shall render to GWDB such services of an advisory
or consultative nature in order to assist GWDB in the analysis of proposed
divestiture/sales or acquisitions that may benefit GWDB; rendering of legal
advice and services in the structuring of divestitures, acquisitions, joint
ventures, strategic alliances, and other business related matters; and in
order to permit GWDB to comply with all state and Federal securities laws
and regulations.
TIME, PLACE AND MANNER OF PERFORMANCE. The Consultant shall be available for
advice and counsel to the president and chief executive officer of GWDB,
Xxxx Xxxxxx, at such reasonable and convenient times and places as may be
mutually agreed upon. Except as aforesaid, the time, place and manner of
performance of the services hereunder, shall be determined in the sole
discretion of the Consultant; however, the Consultant will provide a
minimum of 250 hours.
TERM OF AGREEMENT. The term of this Agreement shall be for 12 months; commencing
March 1, 2006 and terminating on March 1, 2007, unless terminated as set
forth herein.
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COMPENSATION. In consideration of the services to be provided for GWDB by the
Consultant, GWDB hereby agrees to the following deliverable schedule for
compensation:
MERGERS AND ACQUISITIONS PROJECT CONSULTING. Upon execution of this
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Consulting Agreement and the commencement by the Consultant of services to
be rendered pursuant to this Agreement, GWDB agrees to issue and deliver
400,000,000 shares of common stock as compensation to the Consultant for
the services to be rendered to GWDB. At the sole discretion of GWDB's board
of directors or by GWDB's president and chief executive officer, GWDB may
thereafter provide an additional number of shares of common stock at any
time prior to the termination date of this Agreement, based upon progress
reports, and/or within thirty (30) days of receipt, acceptance and approval
by GWDB of the final deliverables. GWDB agrees, as soon as reasonably
practicable, to register the Shares 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 then available).
CONFIDENTIALITY. The Consultant covenants that all information concerning GWDB,
including proprietary information, which he 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 GWDB,
nor shall the confidential information be disclosed by the Consultant to
any third party without prior written consent of GWDB, provided, however,
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that the Consultant shall not be obligated to treat as confidential, or
return to GWDB copies of confidential information that (i) was publicly
known at the time of disclosure to the Consultant; (ii) becomes publicly
known or available thereafter other than by any means in violation of this
Agreement or any other duty owed to GWDB by the Consultant, or; (iii) is
lawfully disclosed to the Consultant by a third party or is required by any
entity or court of competent jurisdiction or lawful request of any
regulatory body or agency.
INDEPENDENT CONTRACTOR. The Consultant and GWDB hereby acknowledge that the
Consultant is an independent contractor. The Consultant agrees not to hold
himself out as, nor shall take any action from which others might
reasonably infer that the Consultant is a partner or agent or a joint
venturer with GWDB. In addition, the Consultant shall take no action that,
to the knowledge of the Consultant binds, or purports to bind, GWDB to any
contract or agreement.
EXPENSES. Consultant covers typical expenses expected to be incurred by the
Consultant. For other extraordinary expenses beyond minor daily operating
expenses to perform services under this Agreement, GWDB shall reimburse the
Consultant on demand, net 30 days, for all expenses and other
disbursements, provided these expenses and disbursements shall have GWDB's
prior written approval and be verifiable with receipts and documentation as
may be required under GAAP for accounting purposes
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of GWDB. All expense invoices pre-approved and received by GWDB will be
addressed on a net 30-day basis.
TERMINATION. Notwithstanding any provision contained in this Agreement to the
contrary, this Agreement may be terminated by GWDB at any time, for any
reason, with or without cause, at the sole discretion of GWDB, with 30 days
written notice to Consultant. Upon termination of this Agreement prior to
the end of its anticipated expiration on July 31, 2003, with or without
cause, GWDB has no requirement for payment of compensation or expenses of
any kind, explicit or implicit, and GWDB assumes no liabilities either
express or implied as a result of any terms of this Agreement. Until
receipt of Consultant's deliverables by GWDB and the acceptance by GWDB of
the adequacy and completeness of these deliverables in the sole discretion
of GWDB, there is no creation of liabilities either express or implied
under this Agreement; except that, at the sole discretion of GWDB, it may
provide portions of compensation for work product received and accepted,
and for project progress, as optional and voluntary interim compensation to
Consultant by GWDB, up to the full amount to be paid. GWDB may also, at any
time, terminate this Agreement for cause. For purposes of this Agreement
the term "cause" means a termination of this Agreement during the term
which is a result of (i) the Consultant's felony conviction or plea of "no
contest" to a felony; (ii) the Consultant's willful disclosure of material
trade secrets or other material confidential information related to
Consultant's business; or (iii) the Consultant's willful and continued
failure to substantially perform his duties for GWDB after a written demand
for substantial performance is delivered by GWDB to the Consultant, which
demand specifically identifies the manner in which GWDB believes that the
Consultant has not substantially performed his duties, and which
performance is not substantially corrected by the Consultant within 10 days
of delivery of such demand. For purposes of the previous sentence, no act
or failure to act on the Consultant's part shall be deemed "willful" unless
done, or omitted to be done, by the Consultant not in good faith and
without reasonable belief that the Consultant's action or omission was in
the best interest of GWDB. In the accomplishment of the performance of such
duties and responsibilities as are assigned to Consultant under the terms
of this Agreement, Consultant shall at all times conduct himself in a
professional manner and shall conform to those standards of ethical conduct
as are generally expected from those performing such services in the
business community
WORK PRODUCT. It is agreed that the Consultant retains all property rights with
respect to the deliverables until payment in full for all work product is
received by the Consultant from GWDB and GWDB has given final quality
assurance approval to the work product and deliverables.
CONFLICT OF INTEREST. The Consultant shall be free to perform services for other
persons. The Consultant will notify GWDB of his performance of consulting
services for any other person, which could conflict with his obligations
under this Agreement. Upon receiving such notice, GWDB may terminate this
Agreement or may in writing waive
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the conflict concerns and continue with this Agreement at the sole
discretion of GWDB.
INDEMNIFICATION FOR SECURITIES LAW VIOLATIONS. GWDB and the Consultant agree to
mutually indemnify and hold each other and each officer, director and
controlling person of GWDB or the Consultant harmless against any losses,
claims, damages, liabilities and/or expenses (including any legal or other
expenses reasonably incurred in investigating or defending any action or
claim in respect thereof) to which the Consultant or GWDB or such officer,
director or controlling person may become subject under the Securities Act
of 1933, as amended, or the Securities Exchange Act of 1934, as amended,
because of inappropriate actions of the Consultant or GWDB or their
agent(s). GWDB and the Consultant will comply with all of the applicable
laws of the Securities Act of 1933.
NOTICES. Any notices required or permitted to be given under this Agreement
shall be sufficient if in writing and delivered or sent by registered or
certified mail to the principal office of each party.
WAIVER OF BREACH. Any waiver by GWDB of a breach of any provision of this
Agreement by the Consultant shall not operate or be construed as a waiver
of any subsequent breach by the Consultant. Any waiver by Consultant of a
breach of any provision of this Agreement by GWDB shall not operate or be
construed as a waiver of any subsequent breach by GWDB.
ASSIGNMENT. This Agreement and the rights and obligations of the parties
hereunder shall not be assignable, unless written authorization to assign
the Agreement, rights and obligations hereunder is obtained from the other
non-assigning Party.
Severability. All agreements and covenants contained herein are severable, and
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in the event any of them shall be held to be invalid by any competent
court, the Agreement shall be interpreted as if such invalid agreements or
covenants were not contained herein.
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.
WAIVER AND MODIFICATION. Any waiver, alteration or modification of any of the
provisions of this Agreement shall be valid only if made in writing and
signed by the parties hereto. Each party hereto, from time to time, may
waive any of its rights hereunder without effecting a waiver with respect
to any subsequent occurrences or transactions hereof.
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COUNTERPARTS. This Agreement may be executed in counterparts, each of which
shall be deemed an original but both of which taken together shall
constitute but one and the same document.
GOVERNING LAW; VENUE. This Agreement shall be governed by and construed in
accordance with the laws of the State of Nevada, and all issues of
interpretation arising under this Agreement including, without limitation,
issues with respect to capacity of the parties, execution and construction
of the Agreement, the manner of performance under the Agreement, the
validity of the Agreement and the rights and duties of the parties
hereunder shall be decided in accordance with such law. The parties
stipulate and agree that any and all legal actions or proceedings, which
arise under this Agreement, shall be commenced within the State of Nevada,
in a court of competent jurisdiction.
COSTS AND FEES. In the event that any of the parties hereto institutes any
action, suit or proceeding to enforce the provisions of this Agreement, or
for breach thereof, or to declare the rights of the parties with respect
thereto, the prevailing party shall be entitled to recover, in addition to
damages, injunctive or other relief, reasonable costs and expenses
including, without limitation, costs and reasonable attorneys' fees
incurred in the furtherance of such action, suit or proceeding.
NEGOTIATED TRANSACTION. The provisions of this Agreement were negotiated by both
of the parties hereto, and said Agreement shall be deemed to have been
drafted by both parties.
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement as of the day and year first above written.
CONSULTANT
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Xxxxx Xxxxxx
GATEWAY DISTRIBUTORS, LTD.
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Xxxx Xxxxxx, Chairman/President
Date
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