Exhibit 10.1
Xxxxxxxx & Xxxxxx
000 Xxxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx
00000-0000
Tel 000 000 0000
Xxxxxxx X. Xxxxxxx
Partner
April 22, 2002
VIA FEDEX
The Equitable Group
Attn. B. Xxxxxxx Xxxxxxxx
000 Xxxxxx Xxxx, Xxxxx 0000
Xxxx Xxxxx, Xx. 33431
Re: Consulting Agreement
Dear Xx. Xxxxxxxx,
On behalf of SLS International, Inc. ("SLS") and pursuant to Section 5B of the
Consulting Agreement, dated March 26, 2002 (Agreement"), between SLS and The
Equitable Group LLC, SLS hereby terminates the Agreement, effective in ten days.
Pursuant to Sections 2B and 4 fo the Agreement. Please promptly return the
certificate for 600,000 shares of SLS common stock to the following address:
SLS International, Inc.
Attn. Xxxx Xxxx
0000 Xxxxx Xxxxxx
Xxxxxxxxxxx, Xx. 00000
SLS Agrees to comply with the payment obligations imposed upon them by Sections
5A and 5C of the Agreement. Please be aware of your continuing obligations
pursuant to Section 7 of the Agreement
Please let me know if you have any questions. Thank you for your assistance.
Sincerely yours
/s/ Xxxxxxx X. Xxxxxxx
-------------------------
Xxxxxxx X. Xxxxxxx
cc. Xxxx Xxxx
CONSULTING AGREEMENT
It is hereby understood and agreed that SLS International, Inc.
("Company" or "Client), a Delaware corporation, having its principal business
office at 0000X. Xxxxxx Xxx., Xxxxxxxxxxx, Xx. 00000 and The Equitable Group,
LLC, a Florida corporation ("Consultant") having its principal business office
located at 000 Xxxxxx Xx. Xxxxx 0000 Xxxx Xxxxx, Xx. 33431, shall enter into
this agreement (the Agreement") this 26 day of March 2002 (the "Effective
Date"). The terms and conditions of this Agreement shall expire if not executed
by all parties by the close of business on __________.
RECITALS
A. The Client is seeking financial advice regarding business and
financing activities.
B. Consultant has the ability to and is willing to furnish business and
financial related advice and services to Client on the terms and conditions
hereinafter set forth.
C. The Client is engaged in the business of Manufacturing. The client
requires capital or other financial assistance to implement and continue to
develop its business operations.
Now, Therefore, in consideration of the mutual terms and covenants
contained herein, and for other good and valuable consideration, the receipt of
which is hereby acknowledged, the parties agree as follows:
1. Services to Be Provided By consultant
A. Services. Consultant shall provide the following services to Client
on a non-exclusive basis.
I: Analyzing the financial operations and financial needs of
the Client and making appropriate recommendations for accounting, investment
banking or legal services to be retained by the Client Company and the structure
and characteristics of potential financing and investor relations services
including, but not limited to, fund raising under private placement memorandums,
securing lines of credit, revolving or otherwise:
II: Advising the Client on the appropriate information and
format (including business plans)(the "Business Plan) or PPM to be presented by
the Client to individual investors, for the purpose of obtaining financing and
coordinating and completing the presentation of the narrative of the Business
Plan of PPM, which shall include working in cooperation with the Client's
professional in preparing appropriate sections thereof, including but not
limited to the sections regarding the use of proceeds, business description,
funding plan, financial data, and financial projections, in compliance with all
federal and state securities laws and other applicable rules, laws, and
regulations.
III: Providing such other advisory services, including with
regard to marketing, general and administrative matters, operations, and
developments concerning the parameters attendant upon reducing general and
administrative expenses, increasing revenue and income and otherwise increasing
the Company's overall financial performance and shareholder equity, as mutually
agreed upon between Consultant and Client.
IV: Introduce the Company to an increased shareholder base
through the use of "IPO" and "Executive Road Shows" to brokerage firms, hedge
funds, etc. Feature the Company on Financial Radio Talk Shows. Feature Company
on Network of Financial Sites online. Make itself available for personal
consultation with the officers, directors and/or employees of the Company at the
offices of the Company, or such other mutually agreed upon place the during the
normal business hours for reasonable periods subject to reasonable advance
notice and mutually convenient scheduling.
V: Make itself available for consultations by telephone with
principal financial, sales and/or operating officer(s) of the Company during
normal business hours.
VI: Perform such other lawful consulting and advisory services
relatin to such aspects fo the Company, its management, operations and
development as the principals, executive, financial, sales and/or operating
officer(s) of the Company may reasonably request consistent with the provisions
of the this Agreement (items I through VI: are hereinafter sometimes
collectively referred to as the "Services").
B. Devotion Of Time. The Consultant shall devote such percentage of the
Consultant's total time to the performance of the Services as shall be
reasonably necessary to accomplish the same. In this regard, it is hereby
specifically agreed that the Consultant shall not be required to devote any
specific minimum number of hours per week of Services to the Company solely in
exchange for the compensation indicated herein but shall be required to devote
such time as is reasonably necessary to fulfill the Consultant's duties and
obligations to achieve the business purposes of the Company.
C. Outside Scope. Consultant will obtain the written permission of the
Client to go outside of the initial scope of the Agreement. Any addendum to this
Agreement shall be in writing, executed by both parties hereto and be made part
of , and shall not alter the original terms and conditions of this Agreement,
except as specifically stated in the addendum.
2. Consideration. Inconsideration for the performance of such Services, the
Company shall pay the Consultant and the Consultant hereby accepts the following
fees as compensation for the services to be rendered under this Agreement.
A. Out of pocket disbursements. The Company will reimburse the
Consultant for any out of pocket expenses on a pre-approved basis
including, but not limited to, air travel, hotel, meals, airport
parking and related expenses, courier, photocopy and facsimile and long
distance phone charges incurred in connection with the services
provided under this Agreement(but excluding photocopy, facsimile and
phone charges incurred form the Consultant's offices- this provision is
intended only to cover such charges incurred while traveling); provided
Consultant must obtain advance approval, in writing from the Client for
any single expense in excess of $500.00
. B. Advisory Fee. In order to commence this project,
Consultant requires receipt of 600,000 shares of 144 (restricted) stock
of SITI which shall have piggy-back registration rights, subject to
customary terms and conditions, in return for both capital raise of
$1,000,000 on a "best efforts" basis and investor relations services.
Additionally, 10% a advisory fee (for placement agent) against monies
raised as a direct result of the Consultant's efforts shall be paid
before the termination of the agreement, Further, 100,000 of the
600,000 shares shall be non refundable upon signing of the agreement
and implementation of the investor relations program if the contract is
no cancelled within 30 days. The 100,000 shares shall have piggy-back
registration rights as well. Upon sufficient funding for the company
and or Company's agreement with investment relations services,
Consultant shall receive the amount of $10,000 per month during the
first three months of this agreement. . The 600,000 shares of SITI
common stock are refundable as follows: (i) all 600,000 shares shall be
returned to the Company without and consideration if either party gives
notice of its desire to terminate the Agreement within 30 days
following the effective date; and (ii) 500,000 shares shall be returned
to the Company without any consideration (and Consultant shall retain
100,000 shares) if either party gives notice of its desire to terminate
the Agreement prior to a registration of shares for a capital raise of
$1 million as contemplated by this Agreement.
C. Other Services. It is agreed that this Agreement covers
only the Services and should additional assistance be requested,
Consultant will charge separately for the additional assistance in
amounts and on terms mutually agreed upon by the Company and the
Consultant. Consultant shall assist the client in identifying, advising
and retaining both accounting and legal services on behalf of the
Client for future filings and guidance for the Company to carry out the
ordinary business and requirements for the Client Company for normal
operation Company.
3. Responsibilities Of The Client
The Client agrees to provide all documents requested by Consultant
promptly, which documentation may include, without limitation, financial
statements, corporate governance documents and IRS reports and filings, to be
used solely by Consultant as contemplated by the Agreement.
4. Payments
It is agreed that Consultant's compensation, consulting fees, or equity
earned by Consultant shall be paid in the amount of 600,000 shares of 144
(restricted) stock of SITI which shall have piggy-back registration rights,
subject to customary terms and conditions, in return for both capital raise of
$1,000,000 on a "best efforts" basis and investor relations services.
Additionally, 10% a advisory fee (for placement agent) against monies raised as
a direct result of the Consultant's efforts shall be paid before the termination
of this agreement. Further 100,000 shares of the 600,000 shares shall be
non-refundable upon signing of this agreement and implementation of the investor
relations program if this contract is not cancelled within 30 days. The 100,000
shares shall have piggy-back registration rights as well. Upon sufficient
funding for the company and or Company's agreement with investment relations
services, Consultant shall receive the amount of $10,000 per month during the
first three months of this Agreement. The 600,000 shares of SITI common stock
are refundable as follows. . The 600,000 shares of SITI common stock are
refundable as follows: (i) all 600,000 shares shall be returned to the Company
without and consideration if either party gives notice of its desire to
terminate the Agreement within 30 days following the effective date; and (ii)
500,000 shares shall be returned to the Company without any consideration (and
Consultant shall retain 100,000 shares) if either party gives notice of its
desire to terminate the Agreement prior to a registration of shares for a
capital raise of $1 million as contemplated by this Agreement.
5. Terms and Termination
A. This Agreement shall commence as of the Effective Date and
shall continue for a period of six (6) months thereafter.
Should the Company terminate or attempt to terminate this
Agreement at any time, for any reason, the Company shall
remain obligated to make payment to the Consultant for all
consideration due or outstanding at the time of the
termination.
B. Subject to the obligations set forth in Section 5c and Section
7 of this Agreement, this Agreement may be terminated by the
Company on no less that ten(10) days prior written notice or
by the Consultant on no less than (30) days prior written
notice.
C. In the event that this Agreement is terminated by either party
hereto, the consultant shall be entitled to the 10% advisory
fee as provided hereunder for any transaction for which the
discussions were initiated by the Consultant during the term
of the Agreement and which funding to the Company is
consummated within a period of sic(6) months after the
termination of this Agreement as a result of the Consultant's
efforts.
6. Obligations of Both Parties
The parties both agree that they will cooperate with each other and
provide full due diligence, and that all conversation, documentation,. or work
products will be kept in the utmost confidence, Consultant will not have the
permission to offer. Copy or duplicate any part of the work product of the
client without the express written permission of the Client.
7. Confidentiality; Ownership
A. Consultant acknowledges that it is the policy of the Client to
maintain as secret and confidential all proprietary information heretofore or
hereafter acquired, developed or used by the Client in relation to its business,
operations, employees, and customers which may give the Client a competitive
advantage in its industry (all such information is hereinafter referred to as
"Confidential Information"). The parties recognize that, by reason of its
duties, Consultant may acquire Confidential Information, Consultant recognizes
that all such Confidential Information is the property of the Client. In
consideration of the Client entering into the Agreement, Consultant agrees that
it shall never, directly or indirectly, intentionally or unintentionally, use or
publicly disseminate or otherwise disclose any Confidential Information obtained
during its engagement by the Client without the prior written consent of the
Client, unless and until such information is otherwise in the public domain, it
being understood that the obligation created by this paragraph shall survive the
termination of the Agreement. In furtherance of the Consultant's obligations
under this section 7. Consultant agrees that for a period of two years following
the termination of this Agreement Consultant shall not represent or provide
services to the following competitors of the company. JBL,EAW, Electro Voice,
Mackie, Mayer, Boston Acoustic and Polk Audio.
9. Non Representation By Consultant
Nothing contained in this Agreement nor Consultant' duties hereunder
shall be construed as rendering the services of an attorney or certified public
accountant (CPA), and that Client should seek the professional advice necessary
in all legal and accounting matters. Any attorney or CPA or professional that is
engaged on behalf of the Client shall be paid directly by the Client. Consultant
does not receive a referral fee from any attorney of CPA. Consultant does not
guarantee the success of the Client's business.
10. Indemnification
In addition to the fees which the Company has agreed to pay to the
Consultant for the services performed under this Agreement, the Company also
agrees to indemnify and hold harmless the Consultant, its affiliates and the
representative directors, officers, employees and agents of the Consultant and
its affiliates form and against any claims or actions, including fees and
expenses, arising out of or in connection with the services rendered by the
Consultant under the Agreement, provided however, that this shall not apply to
any act or omission by the Consultant, its officers, directors, employees or
affiliates which violates this Agreement; constitutes fraud, negligence or
willful misconduct, or is contrary to any law, rule or regulation. Consultant
shall indemnify and hold harmless the Company, its affiliates and the respective
directors, officers, employees and agents of the Company and its affiliates from
any claims or actions, including fees and expenses, arising out of Consultant's
violation of the Agreement; Consultant's fraud, negligence or willful
misconduct; or Consultant's violation of any law, rule or regulation.
11. Miscellaneous
A. This Agreement shall no constitute an employer-employee
relationship. It is the intention of the parties that Consultant shall be at all
times an independent contractor of the Client. Consultant shall not have any
authority to act as the agent of the Client and shall not have the authority to,
and not bind the Client to any agreement or obligatio9ns with a third party
except as otherwise authorized by the Client. Subject to the express provisions
herein, the manner and means utilized by Consultant in the performance of its
services hereunder shall be under the sole control of Consultant. The Consultant
shall be free to pursue, conduct and carry on for the Consultant's own account
such activities, employment, ventures, businesses and other pursuits as the
Consultant, in the Consultant's sole absolute and unfettered discretion.,may
elect.
B. Any action under this Agreement must be in writing and sent by
Federal Express or any other 24-hour guaranteed courier. The addresses of the
parties for the receipt of notice shall be as follows:
Consultant: The Equitable Group, Attn. B. Xxxxxxx Xxxxxxxx
Address: 000 Xxxxxx Xxxx Xxxxx 0000, Xxxx Xxxxx, Xx. 33431
Company: SLS International, Inc. Attn. Xxxx Xxxx
Address: 0000 Xxxxx Xxxxxx, Xxxxxxxxxxx, Xx. 00000
C. This Agreement is made and shall be governed by and construed in
accordance with the laws of the State of Florida. This Agreement shall be
governed and construed in accordance with the laws of the State of Florida,
exclusive of its choice of law principles.
D. Any attempt by either party to assign any rights, duties, or
obligations that arise under this Agreement without the prior written consent of
the other party shall be void and shall constitute a breach of the terms of this
Agreement. This Agreement shall insure to the benefit of and be bonding upon the
parties hereto and their respective legal representatives, administrators,
executors, successors, subsidiaries and affiliates.
E. This Agreement constitutes the entire Agreement between Client and
Consultant. No promises, guarantees, inducements or agreements, oral or written
express or implied have been made regarding the provision of investment banking
consulting services, other than as contained in this Agreement. This Agreement
can be modified only in writing signed by both parties hereto.
F. In the event of the invalidity or unenforceability of any one or
more of the provisions of the This Agreement. Such illegality or
unenforceability shall not effect the validity or enforceability of the other
provisions hereof, and such other provisions shall be deemed to remain in full
force and effect.
G. The provisions relating to the Confidential Information shall
survive the expiration or the termination of obligations of each party to the
other.
H. This Agreement may be executed in one or more counterparts. Each of
which shall be deemed to be an original, but all of which together shall
constitute on and the same instrument.
I. It is hereby understood and agreed that in the event of a lawsuit by
either party, all court costs, attorney fees., and expenses incurred by the
prevailing party in such action shall be the responsibility of the
non-prevailing party.
It is hereby agreed that the terms and conditions are satisfactory to
all parties hereto and they have caused this Agreement to be duly esecurted, as
of the day and year first above written.
Company Consultant
By: /s/ Xxxx X. Xxxx By: /s/ B. Xxxxxxx Xxxxxxxx
------------------- ------------------------
Xxxx X. Xxxx B. Xxxxxxx Xxxxxxxx
Chairman & CEO Pres. & CEO
