CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT ("Agreement") is entered into effective February
25, 1998, between COLMENA CORP., a Delaware corporation, with its principal
offices located at 00000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000 (hereinafter
referred to as the :Company"), and SBV CORPORATION, a Delaware corporation, with
its principal offices located at 0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 000, Xxxx
Xxxxxxxxxx, Xxxxxxx 00000 (hereafter "Consultant").
1. Consulting Services
The Company hereby engages Consultant to perform the financial consulting
services listed below on the terms and conditions set forth below in this
Agreement:
(a) Review the business operations of potential transaction candidates;
(b) Meet with the appropriate shareholder groups in an effort to resolve
any valuation differences;
(c) Initiate and negotiate on behalf of the Company to explore potential
transactions;
(d) Analyze and evaluate the projected financial performance of the
Company;
(e) Assist in the formulation of a strategy for discussions with and the
presentation of a transaction proposal to any interested parties;
(f) As mutually agreed, advise the Company regarding alternative
financing structures (including bridge loans) with which to effect a
transaction;
(g) Assist in negotiations of letter of intent and definitive purchase
or financing agreements with any interested parties and their
advisors;
(h) Provide, as deemed appropriate by Consultant, additional financial
advisory services related to a transaction.
While Consultant has relationships and contacts with various investors,
broker-dealers, and investment funds, Consultant's participation in the actual
sale of th Company securities shall be limited to that of an advisor to the
Company and a "finder" of investors, broker-dealers and funds. The Company
acknowledges and agrees that the solicitation and consummation of any purchases
of the Company's securities shall be handled by the Company or one or more NASD
member firms engaged by the Company for such purpose and will only be undertaken
and effected upon consultation with, and the receipt of advice from, counsel who
are knowledgeable of the state and federal securities law that are applicable to
any such transaction(s) as well as the rules and regulations of any Self
Regulatory Organization that may be applicable to any such transaction(s). SBV
Corp. will not receive compensation in connection with the offer or sales of the
Company's securities.
2. Term of Agreement
The term of this Agreement shall commence on the date hereof and shall
continue for a period of twelve (12) months.
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3. Consideration to Consultant
3.1 As compensation for the consulting services rendered hereunder, the
Company shall issue and deliver to Consultant 1,500,000 options (the "Options")
to purchase the share of the Company's common stock, $.01 par value (the "Common
Stock") at an exercise price $2.00 per share, with Options, together with the
underlying shares of Common Stock shall be registered by the Company under the
Securities Act of 1933, as amended, pursuant to a Registration Statement on Form
S-8. The Options shall vest and become exercisable as follows: (i) 500,000
Options are immediately exercisable, (ii) 250,000 Options exercisable on May 1,
1998, (iii) 250,000 Options exercisable on August 1, 1998, (iv) 250,000 Options
exercisable on September 1, 1998 and, (v) 250,000 Options exercisable on
December 1, 1998. The Options period will terminate on the second anniversary
from the date of execution of this Agreement. Should the Company be sold or
should it experience a change in control, the options referenced in (ii), (iii),
(iv), and (v) will immediately vest and become exercisable.
3.2 As additional consideration for the service of Consultant, the Company
agrees to indemnify and hold harmless Consultant and each of its officers,
directors, agents, employees and controlling persons (collectively "Indemnified
Persons") to the fullest extent permitted by law, from and against any and all
losses, claims, damages, expenses (including reasonable fees, disbursements and
other charges of counsel), actions, proceedings or investigations (whether
formal or informal), or threats thereof (all of the foregoing being hereinafter
referred to as "Liabilities"), based upon, relating to or arising out of
Consultant's engagement hereunder, including, but ot limited to Liabilities
arising in connection with the dissemination of information about the Company or
the Company's business, whether in any presentations, in person, through the
mails or otherwise; provided, however, that the Company shall not be liable
under this paragraph to the extent that it is finally judicially determined that
such Liabilities resulted primarily from the willful misconduct or gross
negligence of the Indemnified Person seeking indemnification. In connection with
the Company's obligation to indemnify for expenses as set forth above, the
Company further agrees to reimburse each Indemnified Person for all expenses
(including reasonable fees, disbursements and other charges of counsel) as they
are incurred by such Indemnified person; provided, however, that if an
Indemnified Person is reimbursed hereunder for any expenses, the amount so paid
shall be refunded if and to the extent it is finally judicially determined that
the Liabilities in question resulted primarily from the wilful misconduct of
gross negligence of such Indemnified Person.
4. Miscellaneous
4.1 Further Actions. At any time and from time to time, each party agrees,
at its or his expense, to take such actions and to executed and deliver such
documents as may be reasonably necessary to effectuate the purposes of this
Agreement.
4.2 Entire Agreement; Modification. This Agreement set forth the entire
understanding of the parties with respect to the subject matter hereof and
supersedes all existing agreements among them concerning such subject matter,
and may not be modified only by a written instrument duly executed by the party
to be bound.
4.3 Notices. Any notice or other communication required or permitted to be
given shall be in writing and shall be mailed by certified mail, return receipt
requested (or by the most nearly comparable method if mailed deom or to a
location outside of the United States), or delivered against receipt to the
party to whom it is to be given at the address of such party set forth in the
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preamble to this Agreement (or to such other address as the party shall have
furnished in writing in accordance with the provisions of this Section). Any
notice given to any corporate party shall be addressed to the attention of the
Corporation Secretary. Any notice of other communication given by certified mail
(or by such comparable method) shall be deemed given at the time of
certification thereof (or comparable act), except for a notice changing a
party's address which will be deemed given at the time of receipt thereof.
4.4 Waiver. Any waiver by any party of a breach of any provision of this
Agreement shall not operate as 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 of more occasions will not be considered a waiver or
deprive that party of the right thereafter to insist upon strict adherence to
that term or any other term of this Agreement. Any waiver must be in writing
and, in the case of a corporate party, be authorized by a resolution of the
board of directors or by an officer of the waiving party.
4.5 Binding Effect. The provisions of this Agreement shall be binding upon
the inure to the benefit of the Company and Consulting and their respective
successors and assigns; provided, however, that any assignment by any party of
its rights under this Agreement without the written consent of the other party
shall be void.
4.6 Severability. If any provisions of this Agreement is invalid, illegal,
or unenforceable, the balance of this Agreement shall remain in effect, and if
any provision is inapplicable to any person or circumstances, it shall
nevertheless remain applicable to any other persons and circumstances.
4.7 Headings. The headings in this Agreement are solely for convenience of
reference and shall be given no effect in the construction or interpretation of
this Agreement.
4.8 Counterparts: Governing Law. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. It shall be
governed by and in accordance with the laws of the State of Delaware, without
giving effect to conflict of laws.
4.9 Arbitration. In the event that a dispute arises with respect to this
Agreement, any action or proceeding, instituted by any party to this dispute
shall be before the American Arbitration Association ("AAA") pursuant to the AAA
rules ans may be applicable that govern commercial disputes. The venue of such
proceedings shall be either Dade or Broward County in the State of Florida.
4.10 Attorney's Fees. In the event of a dispute with respect to this
Agreement, the prevailing party shall be entitled to its reasonable attorney's
fees and other costs and expenses incurred in litigating or otherwise resolving
or settling such dispute.
4.11 Notification, Consultant shall be notified, within twenty-four (24)
hours of any such issuance of equity or debt securities.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement s of
the date first set fort above.
COLMENA CORP.
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxxx, Xx.
Name: Xxxxxxx X. Xxxxxx, Xx.
Title: President
AGREED AND ACCEPTED
SBV CORP.
a Delaware corporation
By: /s/ Xxxxxx Xxxxxxxxxxx
Name: Xxxxxx Xxxxxxxxxxx
Title: President
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