EXHIBIT 10.6
SCONSULTING AGREEMENT
This Consulting Agreement (the "Agreement") is made and entered into this 1st
day of January 2001, by and between Stockbroker Associates Corporation, a
Delaware corporation (the "Consultant") whose principle place of business is
0000 Xxxxx Xxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxxx Xxxxx, Xxxxxxxxxx 00000 and
New Mexico Software, Inc., a ________ corporation (the "Client") whose
principal place of business is 0000 Xxxxxx Xxxxxx XX Xxxxxxxxxxx, XX 00000.
RECITALS
1 The Consultant is engaged in the business of providing various
consulting and public relation services for and on behalf of clients whose
equity securities are publicly traded. The Consultant's services on behalf of
clients includes interactions with broker/dealers, shareholders, and members
of the general public. In accordance with and subject to rules, regulations
and policies of the Securities and Exchange Commission ("SEC"), Consultant
provides services on behalf of clients over the Internet.
2 The Client is a company with a class of equity securities that are
publicly traded on one or more markets or exchanges. The Client desires to
retain the Consultant as an independent consultant for various consulting and
public relation services, including interaction with broker/dealers,
shareholders and members of the general public.
AGREEMENT
NOW THEREFORE, in consideration of the mutual promises and agreements set
forth herein, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. CONSULTING AND PUBLIC RELATION SERVICES
The Client hereby retains the Consultant as an independent consultant to the
client and the Consultant hereby accepts and agrees to such retention, subject
to the terms of this agreement. The Consultant shall provide to the Client
such services of an advisory and consultative nature so as to inform the
brokerage community, the client's shareholders and the general public
concerning financial public relation and promotional matters related to the
Client and its business, all in accordance with the laws, rules and
regulations of the SEC (the "Consulting Services"). The Consulting Services
which Consultant shall provide to the Client are on a best efforts basis.
Consultant makes no representation, warranty or guarantee that as a result of
the Consulting Services the trading price of the Client's stock will increase,
the volume of shares traded will increase or that Client will experience
increase revenues. Consultant will:
1 Gather all publicly available information relating to Client and confer
with officers and directors of the Client in an effort to consolidate the
information obtained into appropriate form for dissemination to interested
parties.
2 In accordance with rules, regulations and policy of the SEC, make
available to the general public, information concerning the Client through the
Internet on a website developed and maintained by Consultant.
3 Distribute information concerning the Client to registered
representatives of broker/dealer, and other persons who the Consultant
determines, in its sole discretion, are capable of effectively disseminating
such information to the general public.
4. Engage in public relation activities designed to increase awareness
of Client and its business including but not limited to the placing of
appropriate advertisements in selected national publications.
II. TIME, MANNER AND PLACE PERFORMANCE
The Consultant provides services similar to those provided for herein to other
publicly traded companies. The Client agrees that the Consultant does not and
shall not be required to devote its full time and efforts to the Client. The
Consultant shall devote such time to the Client as is reasonable and necessary
to provide the Consulting Services to the Client. Consultant shall be available
for advice and counsel to the officers and directors of the Client at such
reasonable and convenient times and places as may mutually be agreed upon.
Notwithstanding the foregoing, Consultant shall not undertake the
representation of any other client whose primary business is that of digital
asset management without the express written consent of Client.
Consultant agrees that it shall provide the personal services of Messrs.
Xxxxxxx Xxxx and Xxxx Xxxx as is reasonable necessary to perform the
obligations to Client under this agreement. In providing the services under
this agreement, Consultant may use its staff and personal as it deems
necessary and appropriate to carry out the services hereunder, however Messrs.
Ager and Xxxx will activity manage and participate in the key aspects of the
services. In the event Messrs. Ager and Xxxx cease to be in place as
consultant's senior management during the term of this agreement, Client may
then terminate this agreement upon one (1) day written notice to Consultant.
III. TERM OF THE AGREEMENT
The initial term of this Agreement shall be three (3) months, commencing
February 1, 2001 to April 31, 2001 (the "Initial Term"), subject however, to
prior termination as provided in Section XIII of this Agreement. After the
Initial Term this Agreement shall continue on and may be terminated effective
the last day of the month in which either party gives at least ten (10) days'
prior written notice to the other that it is terminating this Agreement.
IV. COMPENSATION
In consideration of the Consulting Services to be provided to the Client by
the Consultant, Client hereby agrees to compensate Consultant as follows:
1 Upon execution of the Agreement, the Client shall pay the Consultant an
initiation fee in the amount of US $200,000 or equivalent value (the "Initial
Fee"). The Initial Fee is deemed earned upon receipt. The Initial Fee is
compensation for consultant's services during the Initial Term. In the event
that Consultant is compensated in the form of securities, Consultant shall
only sell such securities in accordance with Section VI of this agreement.
Consultant acknowledges that in lieu of cash, it will accept as full payment
of the Initial Fee 100,000 150,000 shares of unrestricted common stock of
Manhattan Scientifics, Inc. owned by Client. in which event Consultant shall
use only the Designated Broker (as defined below) in connection with the
holding and sale of such securities.
2 Upon execution of this agreement, the Client shall issue in the name of
the consultant 1,000,000 shares of client's common stock restricted pursuant
to Rule 144, to be held in escrow by Client's legal counsel _______________,
to be released to Consultant or returned to Client as appropriate, in
accordance with the terms of this agreement (the "Escrowed Stock"). It is
intended that the Escrowed Stock, together with the Initial Fee, shall be
compensation for Consultant's services subsequent to the Initial Term of this
agreement for so long as they shall be provided, and it is further intended
that these shares will be released to Consultant in accordance with the
schedule set forth in subsection 3. (i) through (viii) below.
3 The Escrowed Stock will remain in escrow with Client's legal counsel
and will only be released from escrow to Consultant (provided that this
agreement has not been terminated) according to the following schedule:
(i). 10,000 shares per month, for up to 24 months, shall be released to
consultant on the last day of each month in which consultant provides services
to Client subsequent to the Initial Term. Unless sooner terminated, at the
end of 24 months Client and Consultant shall mutually agree on further
compensation for Consultant's services.
(ii). 100,000 shares shall be released to Consultant the first time that
Client's average daily trading volume over a 10 day period exceeds 150,000
100,000 shares.
(iii). 50,000 shares shall be released to Consultant the first time that
Client's number of shareholders doubles from the number of Client's
shareholders as of the date of this agreement.
(iii). 100,000 shares shall be released to Consultant the first time that
Client's market capitalization is $50,000,000 or greater for at least 10
consecutive trading days.
(iv). 100,000 shares shall be released to Consultant the first time that
Client's market capitalization is $100,000,000 or greater for at least 10
consecutive trading days.
(v). 100,000 shares shall be released to Consultant the first time that
Client's market capitalization is $150,000,000 or greater for at least 10
consecutive trading days.
(vi). 100,000 shares shall be released to Consultant when Client becomes
eligible for listing on NASDAQ (NMS or Small Cap).
(vii). Any shares remaining in escrow shall be released to Consultant the
first time that Client's market capitalization is $220,000,000 or greater for
at least 10 consecutive trading days.
(viii). Upon issuance of the shares remaining in escrow pursuant to section
IV. 3. (viii) of this Agreement, Client shall not be obligated to issue any
further shares to Consultant under this Agreement, provided however, that
Client and Consultant may, by mutual agreement signed by each of Client and
Consultant, amend this Agreement to provide for the issuance of additional
shares from Client to consultant.
(ix). If this Agreement is terminated, that portion of the Escrowed Stock
that has not been earned by Consultant shall promptly be returned to Client.
(x). consultant shall open a brokerage account with Xxx Xxxxxx of Wall Street
Equities (the "Designated Broker") for the purpose of receiving, holding and
selling Escrowed Stock. Any and all Escrowed Stock being released to
consultant shall be released directly to the Designated Broker. Consultant
agrees to continuously keep all of the Escrowed Stock released to it with the
Designated Broker and not to use any other broker in connection with the
Escrowed Stock. If Xxx Xxxxxx shall cease to be a registered representative
at Wall Street Equities, then there shall be no Designated Broker and
Consultant may keep the Escrowed Stock at such place as Consultant may
determine. Consultant shall designate another registered representative at
Wall Street Equities as the Designated Broker. If Wall Street Equities shall
cease to exist as a registered broker/dealer, shall designate another
registered representative at another registered broker/dealer as the
Designated Broker.
V. EXPENSES
The Client shall reimburse the Consultant for all expenses and other
disbursements which Client shall have approved in writing prior to Consultant
incurring any such expense or disbursement.
VI. SALES OF SHARES RECEIVED
Shares received by the Consultant from the Client pursuant to Paragraph IV (c)
of this Agreement are compensation to the Consultant for:
a. The initial time which Consultant must devote to the Client to
familiarize itself with Client's business so as to provide the Consulting
Services
b. Consulting Services to be provided during the course of this Agreement
c. The business which Consultant must decline from other potential
clients in order to be able to provide Consulting Services called for under
this Agreement to Client.
It is Consultant's intention to sell the Shares received during the term of
this Agreement. The Client agrees that during the term of this Agreement, the
Consultant may sell the Shares at such times and in such manner as may be
determined in the sole discretion of the Consultant. Client understands that
any sales of the Shares by Consultant may have the effect of decreasing the
trading price of the Client's stock, particularly if Client's stock is thinly
traded. The Consultant will use reasonable efforts to make such sales at such
times and in such a manner so as to minimize any adverse effect to the Client
from sales of the Shares, and in a gradual and methodical manner over time
that is reasonable calculated to preserve, to the extent possible, and not
diminish the share price of such securities. Notwithstanding the foregoing,
Consultant shall sell no more than 10,000 shares per day, provided however,
that at the request of Consultant the Designated Broker may increase the
number of shares sold per day. In the event there is no Designated Broker,
Consultant may sell no more than 10,000 shares per day. Under no
circumstances will the Client place stop transfer instructions ("Stop Transfer
Instructions") with its transfer agent with respect to the Shares. In the
event places Stop Transfer Instructions with respect to the Shares, Consultant
may deliver this Agreement to the transfer agent of Client, and
notwithstanding the Stop Transfer Instructions, transfer agent may then
transfer the Shares at the direction of the Consultant or Consultant's agent.
VII. WORK PRODUCT
Client acknowledges that in the course of performing under this Agreement,
Consultant, Consultant will be contacting various persons about the Client.
It is agreed that Consultant retains all intellectual property rights with
respect to such contact list (the "Contact List") and all material
specifically created or developed by Consultant in connection with the
Consulting Services performed for the Client (the "Materials"). Consultant
hereby grants Client the right to use the Materials (but not the Contact List)
after their distribution solely for the purpose of promoting the Client to
existing and prospective investors, but the Contact List and Material shall be
and remain the physical and intellectual property of the Consultant and all
proprietary rights thereto shall remain with Consultant.
VIII. DISCLOSURE OF INFORMATION
The Consultant recognizes and acknowledges that it has and will have access to
certain confidential information of the Client's and its affiliates that are
valuable, special and unique assets and property of the Client and such
affiliates ("Confidential Information"). The Consultant will not, during and
after the term of this Agreement, disclose, without the prior written consent
or authorization of the Client, any Confidential Information to any person,
except authorized representatives of the Consultant or its affiliates, for any
reason or purpose whatsoever. In this regard, the Client agrees that such
authorization or consent to disclose may be conditioned upon the disclosure
being made pursuant to a secrecy agreement, protective order, provision of
statute, rule, regulation or procedure under which the confidentiality of the
information is maintained in the hands of the person to whom the information
is to be disclosed or in compliance with the terms of a judicial order or
administrative process. Any information which has been disclosed to the
public by the Client or upon the authorization of the client shall not be
considered Confidential Information.
Consultant specifically acknowledges that Client intends to introduce
Consultant to Xxxxx Xxxxxxxx of Belgium, an analyst ("Goossens"), for the
purpose of working cooperatively to increase awareness about Client. This
introduction and any resulting materials are Confidential Information.
Consultant agrees that it shall not work with Goossens upon any matter, during
the period of 2 years from the date of termination of this Agreement, without
prior written approval of Client.
Client specifically acknowledges that Consultant intends to introduce Client
to certain of its contacts ("Consultant's Contacts") for the purpose of
working cooperatively to increase awareness about Client. These introductions
are Confidential Information. Client agrees that it shall not work with
Consultant's Contacts upon any matter, during the period of 2 years from the
date of termination of this Agreement, without the prior written approval of
Consultant, except that notwithstanding the foregoing, Client may work with a
private investor that is an equity owner of Client at the termination of this
Agreement.
IX. NATURE OF RELATIONSHIP
Nothing in this Agreement shall render any party a general partner of the
other. Except as set forth in this Agreement neither party is nor shall be a
general agent for the other and neither party is given authority to act on
behalf of the other. The Consultant is retained by the Client in an
independent capacity and excepts as set forth in this Agreement, Consultant
shall not enter into any agreement or incur any obligation on behalf of the
Client. Notwithstanding any other term of this Agreement, Client shall not
be obligated to follow of implement the material advice or material strategies
developed by Consultant, and, subject to all applicable law, rules and
regulations, Consultant shall follow the direction of Client as to how and
whether Consultant's services are to be utilized, if at all.
X. CONFLICT OF INTEREST
This Agreement is non-exclusive. The Consultant shall be free to perform
services for other companies and persons, subject to the limitations set forth
in this Agreement. Consultant will use its best efforts to avoid conflicts of
interest. Client agrees that it shall not be a conflict of interest that
Consultant devotes time and resources to companies and persons other than
Client, subject to the limitations set forth in this Agreement. In the event
that Consultant believes a conflict of interest arises which may effect the
performance of the Consulting Services for Client, Consultant shall promptly
notify the Client of such conflict. Upon receiving such notice, the Client
may terminate this Agreement pursuant to Section XIII. Failure to give notice
of termination of terminate this Agreement within 60 days of notification of
any conflict of interest shall constitute the Client's ongoing consent to the
Consultant's continued activities.
XI. INDEMNIFICATION FOR SECURITIES LAWS VIOLATIONS
a. The Client agrees to indemnify, defend and hold harmless the Consultant
and each officer, director and controlling person of the Consultant 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 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, solely because of
actions of the Client or its agent, Client's material publicly available to
the Consultant, or materials provided to Consultant by Client for use by
Consultant in its performance under this Agreement.
b. The Consultant agrees to indemnify, defend and hold harmless the Client
and each officer, director and controlling person of the Client against any
loses, 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 Client of 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, solely because of
actions of the Consultants or its agent (s), or materials created by
Consultant in its performance under this Agreement, unless the materials
created by Consultant are created solely from material provided to Consultant
by Client and Consultant obtains written approval from Client of such
material, in which event, Consultant shall have no obligation to indemnify,
defend and hold harmless Client hereunder.
III. TERMINATION
Notwithstanding Section III of this Agreement, this Agreement may be
terminated:
a. By the Client upon 10 days prior written notice to Consultant. Any
compensation by Consultant, including the Shares received, shall be deemed
fully earned up to the date of termination. Any compensation called for under
this Agreement through the termination date shall be paid by Client to
Consultant.
b. By Consultant upon 10 days prior written notice to the Client in the
event;
(i) Client fails to timely pay any compensation or expense reimbursement to
Consultant when due,
(ii) Clients request Consultant to perform acts or services in violation of
any law, rule, regulation, policy or order of any federal or state regulatory
agency,
(iii) Client provides information to the Consultant for public distribution,
which contains material representations or material omissions,
(iv) Client distributes to the public information containing material
misrepresentations or omissions,
(v) Client is engaging in conduct in violation of any law, including rules,
regulations, orders and policies of any federal or state regulatory agency,
(vi) Client fails to follow or implement the material advice or material
strategies developed by Consultant, or
(vii) Consultant reasonable believes that Clients direction as to how
and whether Consultant's services are to be utilized is hindering or
interfering with Consultant's ability to earned the compensation set
forth in Section IV.
3. (i) through (viii)
of this Agreement.
In the event of termination by the Consultant pursuant to the provisions of
this subparagraph, all compensation received by Consultant from Client will be
deemed fully earned and any compensation due and owing up to the date of termina
tion shall be paid by Client to Consultant.
III. ACCURACY OF INFORMATION
In the distribution and dissemination of information about the Client by the
Consultant, the Consultant is relying upon the accuracy in information
provided to it by the Client. The Client shall use its best efforts to ensure
that all information provided by Client to Consultant, and all information
which Client makes otherwise available to the general public, is full,
complete and accurate and contains no material misrepresentations or
omissions. All information concerning Client to be published and/or
disseminated by Consultant shall have the prior written approval of the
Client. Press releases are the obligation and responsibility of the Client.
Consultant shall not write any press release for or concerning Client.
Consultant shall only publish press written releases concerning Client with
the prior approval of Client.
IV. NOTICES
Any notices required or permitted to be given under this Agreement shall be
sufficient if in writing and delivered via FAX, to the FAX number set forth
below, or if sent by overnight courier to the address set forth below.
a. If to Consultant:
Stockbroker Associates, Inc.
0000 Xxxxx Xxxxxx Xxxx Xxx 000
Xxxxxxx Xxxxx, XX 00000
Fax: (000) 000-0000
With a copy to:
Xxxx X. Xxxxxxxxx
Xxxx, Dill, Carr, Xxxxxxxxxx & Xxxxxxxxx P.C.
000 Xxxxxxx Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxxxxx, 00000
Fax: (000) 000-0000
b. If to Client:
New Mexico Software, Inc.
0000 Xxxxxx Xxxxxx XX
Xxxxxxxxxxx, XX 00000
Fax: (000) 000-0000
With a copy to:
III. ASSIGNMENT
Neither party to this Agreement may assign its rights or obligations hereunder
without the prior written consent of the other party to this Agreement.
IV. APPLICABLE LAW
This Agreement shall be interpreted and construed in accordance with and
pursuant to the laws of the State of California.
V. ARBITRATION
Any controversy or claim arising out of or related to this Agreement, or the
breach thereof, shall be settled by arbitration administrated by the American
Arbitration Association under its Commercial Arbitration Rules, with the
arbitration proceeding and any hearing thereon be held in Los Angeles,
California, and judgement on the award rendered by the arbitrator (s) may be
entered in any court having jurisdiction thereof.
VI. SEVERABILITY
The provisions contained herein are severable and in the event any of them
shall be held invalid, the Agreement shall be interpreted as if such invalid
provisions were not contained herein.
VII. ENTIRE AGREEMENT
This entire Agreement constitutes and embodies the entire understanding and
agreement of the parties and supersedes and replaces all prior understandings,
agreements and negotiations of the parties. This Agreement may not be
modified, except in writing and signed by all parties hereto.
VIII. COUNTERPARTS
This Agreement may be executed in counterparts, each of which shall constitute
and be deemed an original, but both of which taken together shall constitute
to one and the same document.
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this
Agreement the day and year first above written.
CONSULTANT
Stockbroker Associates Corporation
By: ________________________________
Xxxxxxx X. Xxxx, President
CLIENT
New Mexico Software, Inc.
By: ________________________________
Xxxx Xxxxxxxx, Pres.
