Exhibit 10.12
ADVISORY AGREEMENT
THIS ADVISORY AGREEMENT ( the "Agreement") is made this 1st day of June,
2000 by and between Xxxxxx Consulting Group, Inc., a Nevada corporation
("Advisor") and Sedona Worldwide Incorporated, an Arizona corporation with its
offices located in Phoenix, Arizona (the "Company").
WHEREAS, Advisor and Advisors's Personnel (as defined below) have
experience in evaluating and effecting mergers and acquisitions, advising
corporate management, and in performing general administrative duties for
publicly-held companies and development stage investment ventures; and
WHEREAS, the Company desires to retain Advisor to advise and assist the
Company in its development on the terms and conditions set forth below.
NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Company and Advisor
agree as follows:
1. ENGAGEMENT
The Company hereby retains Advisor, effective as of the date hereof ( the
"Effective Date") and continuing until termination, as provided herein, to
assist the Company in it's effecting the purchase of businesses and assets
relative to its business and growth strategy, resolution of outstanding
debt and obligations of the Company, preparation of documents for listing
on OTC BB, the introduction of the Company to brokers and dealers,
potential investors, public relations firms and consultants and others that
may assist the Company in its plans and future development (the
"Services"). The Services are to be provided on a "best efforts" basis
directly and through Advisor's officers or others employed or retained and
under the direction of Advisor ("Advisor's Personnel"); provided, however,
that the Services shall expressly exclude all legal advice, accounting
services or other services which require licenses or certification which
Advisor may not have.
2. TERM
This Agreement shall have an initial term of one (1) year (the "Primary
Term"), commencing with the Effective Date. At the CONCLUSION OF THE
PRIMARY TERM THIS Agreement will automatically be extended on an annual
basis ( the "Extension Period") unless Advisor or the Company shall serve
written notice on the other party terminating the Agreement. Any notice to
terminate given hereunder shall be in writing and shall be delivered at
least thirty (30) days prior to the end of the Primary Term or any
subsequent Extension Period.
3. TIME AND EFFORT OF ADVISOR
Advisor shall allocate time and Advisors Personnel as it deems necessary to
provide the Services. The particular amount of time may vary from day to
day or week to week. Except as otherwise agreed, Advisor's monthly
statement identifying, in general, tasks performed for the Company shall be
conclusive evidence that the Services have been performed. Additionally, in
the absence of willful misfeasance, bad faith, negligence or reckless
disregard for the obligations or duties hereunder by
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Advisor, neither Advisor nor Advisor's Personnel shall be liable to the
Company or any of its shareholders for any act or omission in the course of
or connected with rendering the Services, including but not limited to
losses that may be sustained in any corporate act in any subsequent
Business Opportunity (as defined herein) undertaken by the Company as a
result of advice provided by Advisor or Advisors's Personnel.
4. COMPENSATION
The Company agrees to pay Advisor a fee for the Services ("Advisory Fee")
by way of the delivery by the Company of Four Hundred and Fifteen Thousand
and Eight Hundred (415,800) shares of the Company's common stock upon the
execution hereof. All shares transferred are considered fully earned and
non-assessable as of the date hereof.
5. OTHER SERVICES
If, the Company enters into a merger or exchanges securities with, or
purchases the assets or enters into a joint venture with, or makes an
investment in a company introduced by Advisor ( a "Business Opportunity"),
the Company agrees to pay Advisor a fee equal to ten percent (10%) of the
value of each Business Opportunity introduced by Advisor and acquired or
otherwise participated in by the Company (collectively referred to herein,
in each instance, as the "Transaction Fee"), which shall be payable
immediately following the closing of each such transaction, at the
Company's option, in cash or in shares of the Company's common stock or in
kind.
6. REGISTRATION OF SHARES
Company agrees that any shares issued to satisfy the Advisory Fee (if paid
in shares), and the issuance of shares as a Transaction Fee, that all such
issued shares shall be registered by the Company with the Securities and
Exchange Commission under any subsequent applicable registration statement
filed by the Company. Such issuance or reservation of shares shall be in
reliance on representations and warranties of Advisor set forth herein.
7. COSTS AND EXPENSES
All third party and out-of-pocket expenses incurred by Advisor in the
performance of the Services shall be paid by the Company, including any and
all costs for Internet or Web sites used on behalf of the Company or
Advisor shall be reimbursed if paid by Advisor on behalf of the Company,
within ten (I 0) days of receipt of written notice by Advisor, provided
that the Company must approve in advance all such expenses in excess of
$250 per month. If the Company consents in writing, Advisor may elect to
accept restricted shares of common stock of the Company as payment, valued
at one-half of the bid price.
8. PLACE OF SERVICES
The Services provided by Advisor or Advisor's Personnel hereunder will be
performed at Advisor's offices except as otherwise mutually agreed by
Advisor and the Company.
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9. INDEPENDENT CONTRACTOR
Advisor and Advisor's Personnel will act as an independent contractor in
the performance of its duties under this Agreement. Accordingly, Advisor
will be responsible for payment of all federal, state, and local taxes on
compensation paid under this Agreement, including income and social
security taxes, unemployment insurance, and any other taxes due relative to
Advisor's Personnel, and any and all business license fees as may be
required. This Agreement neither expressly nor impliedly creates a
relationship of principal and agent, or employee and employer, between
Advisor's Personnel and the Company. Neither Advisor nor Advisor's
Personnel are authorized to enter into any agreements on behalf of the
Company. The Company expressly retains the right to approve, in its sole
discretion, each Business Opportunity introduced by Advisor, and to make
all final decisions with respect to effecting a transaction on any Business
Opportunity.
10. REJECTED BUSINESS OPPORTUNITY
If, during the Primary Term of this Agreement or any Extension Period, the
Company elects not to proceed to acquire, participate or invest in any
Business Opportunity identified and/or selected by Advisor, notwithstanding
the time and expense the Company may have incurred reviewing such
transaction, such Business Opportunity shall revert back to and become
proprietary to Advisor, and Advisor shall be entitled to acquire or broker
the sale or investment in such rejected Business Opportunity for its own
account, or submit such assets or Business Opportunity elsewhere. In such
event, Advisor shall be entitled to any and all profits or fees resulting
from Advisor's purchase, referral or placement of any such rejected
Business Opportunity, or the Company's subsequent purchase or financing
with such Business Opportunity in circumvention of Advisor
11. NO AGENCY EXPRESS OR IMPLIED
This Agreement neither expressly nor impliedly creates a relationship of
principal and agent between the Company and Advisor, or employee and
employer as between Advisor's Personnel and the Company.
12. TERMINATION
The Company and Advisor may terminate this Agreement prior to the
expiration of the Primary Term upon thirty (30) days written notice with
mutual written consent. Failing to have mutual consent, without prejudice
to any other remedy to which the terminating party may be entitled, if any,
either party may terminate this Agreement with thirty (30) days written
notice under the following conditions:
(A) By the Company.
(i) If during the Primary Term of this Agreement or any Extension
Period, Advisor is unable or unwilling to provide the Services as
set forth herein for thirty (30) consecutive business days for
any reason whatsoever, other than the Company's default; or,
(ii) If Advisor willfully breaches or neglects the duties required to
be performed hereunder.
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(B) By Advisor.
(i) If the Company breaches this Agreement or fails to make any
payments or provide information required hereunder; or,
(ii) If the Company ceases business or, other than in a merger, sells
a controlling interest to a third party, or agrees to a
consolidation or merger of itself with or into another
corporation, or enters into such a transaction outside of the
scope of this Agreement, or sells substantially all of its assets
to another corporation, entity or individual outside of the scope
of this Agreement; or,
(iii)If the Company subsequent to the execution hereof has a receiver
appointed for its business or assets, or otherwise becomes
insolvent or unable to timely satisfy its obligations in the
ordinary course of, including but not limited to the obligation
to pay the Transaction fee, or the Advisory Fee; or,
(iv) If the Company subsequent to the execution hereof institutes,
makes a general assignment for the benefit of creditors, has
instituted against it any bankruptcy proceeding for
reorganization for rearrangement of its financial affairs, files
a petition in a court of bankruptcy, or is adjudicated a
bankrupt; or,
(v) If any of the disclosures made herein or subsequent hereto by the
Company to Consultant are determined to be materially false or
misleading.
In the event Advisor elects to terminate without cause or this Agreement is
terminated prior to the expiration of the Primary Term or any Extension
Period by mutual written agreement, or by the Company for the reasons set
forth in A(i) and (ii) above, the Company shall only be responsible to pay
Advisor for unreimbursed expenses, Advisory Fee, if any, and Transaction
Fee accrued up to and including the effective date of termination. If this
Agreement is terminated by the Company for any other reason, or by Advisor
for reasons set forth in B(i) through (v) above, Advisor shall be entitled
to any outstanding unpaid portion of reimbursable expenses, Transaction
Fee, if any, and the balance of the Advisory Fee, if any, for the remainder
of the unexpired portion of the applicable term (Primary Term or Extension
Period) of the Agreement.
13. INDEMNIFICATION
Subject to the provisions herein, the Company and Advisor agree to
indemnify, defend and hold each other 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 any action or a breach of any representation,
warranty, covenant, condition, or agreement of the other party to this
Agreement.
14. REMEDIES
Advisor and the Company acknowledge that in the event of a breach of this
Agreement by either party, money damages would be inadequate and the
non-breaching party would have no adequate remedy at law. Accordingly, in
the event of any controversy concerning the rights or obligations under
this Agreement, such rights or obligations shall be enforceable in a court
of equity by a decree of specific performance. Such remedy, however, shall
be cumulative and nonexclusive and shall be in addition to any other remedy
to which the parties may be entitled.
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15. MISCELLANEOUS
(A) SUBSEQUENT EVENTS. Advisor and the Company each agree to notify the
other party if, subsequent to the date of this Agreement, either party
incurs obligations which could compromise its efforts and obligations
under this Agreement.
(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) FURTHER ACTIONS AND ASSURANCES. 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.
(D) WAIVER. Any failure of any party to this Agreement to comply with any
of its obligations, agreements, or conditions hereunder may be waived
in writing by the party to whom such compliance is owed. The failure
of any party to this Agreement to enforce at any time any of the
provisions of this Agreement shall in no way be construed to be a
waiver of any such provision or a waiver of the right of such party
thereafter to enforce each and every such provision. No waiver of any
breach of or noncompliance with this Agreement shall be held to be a
waiver of any other or subsequent breach or noncompliance.
(E) ASSIGNMENT. Neither this Agreement nor any right created by it shall
be assignable by either party without the prior written consent of the
other.
(F) 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 the Company:
Sedona Worldwide Incorporated
0000 Xxxxx 00xx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Telephone: (000) 000-0000
Telefax: (000) 000-0000
Attention: Xxx Xxxxxxx, President
(ii) In the case of Advisor:
Xxxxxx Consulting Group, Inc.
000 Xxxx 000 Xxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Telephone: (000) 000-0000
Telefax: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx, President
or to such other person or address designated in writing by the
Company or Advisor to receive notice.
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(G) 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.
(H) GOVERNING LAW. This Agreement was negotiated and is being contracted
for in Utah, and shall be governed by the laws of the State of Utah,
and the United States of America, notwithstanding any conflict-of-law
provision to the contrary.
(I) BINDING EFFECT. This Agreement shall be binding upon the parties
hereto and inure to the benefit of the parties, their respective
heirs, administrators, executors, successors, and assigns.
(J) ENTIRE AGREEMENT. This Agreement contains the entire agreement between
the parties hereto and supersedes any and all prior agreements,
arrangements, or understandings between the parties relating to the
subject matter of this Agreement. No oral understandings, statements,
promises, or inducements contrary to the terms of this Agreement
exist. No representations, warranties, covenants, or conditions,
express or implied, other than as set forth herein, have been made by
any party.
(K) SEVERABILITY. If any part of this Agreement is deemed to be
unenforceable the balance of the Agreement shall remain in full force
and effect.
(L) COUNTERPARTS. A facsimile, telecopy, or other reproduction of this
Agreement may be executed simultaneously in two or more counterparts,
each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument, by one or more parties
hereto and such executed copy may be delivered by facsimile or similar
instantaneous electronic transmission device pursuant to which the
signature of or on behalf of such party can be seen. In this event,
such execution and delivery shall be considered valid, binding and
effective for all purposes. At the request of any party hereto, all
parties agree to execute an original of this Agreement as well as any
facsimile, telecopy or other reproduction hereof.
(M) TIME IS OF THE ESSENCE. Time is of the essence of this Agreement and
of each and every provision hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
above written.
The "Company" "Advisor"
Sedona Worldwide Incorporated Xxxxxx Consulting Group, Inc.
an Arizona Corporation a Nevada Corporation
By: /s/ Xxx X. Xxxxxxx By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxx X. Xxxxxxx Name: Xxxxxxx X. Xxxxxx
Title: President Title: President
