CONSULTING AGREEMENT
This Consulting Agreement ("Agreement") is effective as of the 28th day
of April 1999 (the "Effective Date"), between SkyLynx Communications, Inc., a
Colorado corporation (the "Company"), and Xxx X. Xxxxx, a resident of San
Diego County, California ("Consultant"), under the following terms and
conditions.
WHEREAS, Consultant was a former employee of Simply Internet, Inc., a
California corporation;
WHEREAS, all or substantially all of the assets of the Simply Internet,
Inc., were purchased by the Company by way of that certain Asset Purchase
Agreement by and among the Company, Simply Internet, Inc., Consultant and
Xxxxxxxxxx Xxxxx dated April 28, 1999 (the "Asset Purchase Agreement"); and
WHEREAS, Consultant resigned as an Employee of Simply Internet, Inc. as
of the closing of the transaction contemplated by the Asset Purchase
Agreement, and the Company and Consultant desire to enter into this Agreement
pursuant to which Consultant will render services to the Company on the terms
and conditions set forth herein.
1. SERVICES TO BE RENDERED
Consultant shall perform the following services to the best of his
ability and to the Company's satisfaction, which may include, without
limitation, assisting Company with technical, operational, marketing and sales
issues.
2. INDEPENDENT CONTRACTOR STATUS
Consultant expressly acknowledges that he will be acting as an
independent contractor and not as an employee, for all purposes. Accordingly,
the Consultant agrees not to hold himself out to the public as an employee of
the Company. As an independent contractor, Consultant shall be responsible
for the payment of social security withholding tax and all other federal,
state and local taxes. If required by law, Consultant shall further be
obligated to secure at his sole cost, worker's compensation insurance,
disability benefits insurance and any other insurance, with the express
understanding that in no event shall Consultant be permitted to make any claim
or demands of any kind under the Company's worker's compensation insurance or
disability insurance policies or any similar policies maintained for the
benefit of Company's employees. Consultant shall also be solely responsible
for any and all costs associated with performing the services to be rendered
under this Agreement, except as provided for under Section 5.
3. TERM
Except as provided otherwise herein, the term of this Agreement shall be
deemed to have commenced on the Effective Date and continue for a period of
one (1) year thereafter (the "Term").
4. COMPENSATION
Consultant's compensation under this Agreement shall be Four Thousand One
Hundred Sixty-Six Dollars and Sixty-Seven Cents ($4,166.67) per month, which
shall be paid by the Company in equal installments payable monthly in arrears.
Such consulting services shall be performed during normal business hours and
shall not exceed fifty (50) hours in any one month.
5. EXPENSES
During the term of this Agreement, and for the sole purpose of performing
the obligations required hereunder, the Company shall provide Consultant with
office space, clerical and secretarial support as may be reasonably necessary,
at the Company's expense, for Consultant to perform the duties required of him
hereunder. The Company shall reimburse Consultant for reasonable marketing,
travel and entertainment expenses incurred in fulfillment of his services
under this Agreement. Consultant shall be reimbursed monthly for all such
expenses paid or incurred during the preceding month upon delivery of an
appropriate expense report and receipts to the Company.
6. TERMINATION OF AGREEMENT
The Company may terminate this Agreement with cause immediately and
without notice, or should Consultant become unwilling or unable to perform the
services provided under this Agreement, the Company may terminate this
Agreement for any reason. As used herein, "Cause" shall mean any of the
following occurrences:
(a) willful violation by Consultant of any statute, regulation or
ordinance, the compliance with which is necessary for operation of the
business of Company;
(b) breach by Consultant of any of the material provisions of this
Agreement;
(c) commission by Consultant of one or more acts of gross
negligence as to any material matter, willful or reckless misconduct, or
willful disobedience in connection with his duties described herein;
(d) use by Consultant during the term hereof of illegal substances
which have a material adverse effect on the performance of the Consultant's
duties hereunder or upon the reputation, business, or goodwill of Company; or
any act of fraud or dishonesty by Consultant of any material matters in
connection with its services hereunder; or any intentional act by Consultant
materially compromising Consultant's reputation or ability to represent
Company with the public; any intentional act or omission by Consultant which
substantially impairs Company's business, goodwill or reputation; or
(e) Consultant being convicted of a felony.
Notwithstanding the foregoing, no occurrence except those listed above as
items (a), (d), and (e) shall constitute Cause unless Consultant receives
written notice from Company objecting to such occurrence, and Consultant fails
to remedy such occurrence within ten (10) days after the receipt of such
written notice or subsequently repeats such occurrence; provided, however, in
no event shall Company be required to give notice of or an opportunity to cure
the occurrence of any of items (b) or (c) above more often than once for such
occurrence to constitute Cause hereunder. For items (a), (d), and (e), above,
Company may terminate Agreement upon their occurrence without prior notice or
opportunity to cure.
Upon Consultant's termination for Cause, Company shall be required to pay
Consultant compensation only through the effective date of termination. Sums
due Consultant for compensation under Section 3 shall be prorated for the then
current month through the date of termination. Any proration of compensation
paid on a monthly basis shall be calculated based on the number of work days
within the month.
The Company may terminate this Agreement at any time during the Term
without Cause if the Company determines, in its reasonable judgment, that
Consultant's services are no longer required. If Company terminates this
Agreement without Cause, Company shall pay Consultant's compensation for the
remainder of the Term as outlined in Section 4.
The post-termination payments provided for in this Section 6 shall be the
only payments which Company shall be obligated to make on account of the
termination of this Agreement, and after such termination, Company shall not
be obligated to make any other payments as damages or otherwise to Consultant.
7. OTHER ACTIVITIES
Consultant shall devote his working time and efforts to performing the
services to be rendered under this Agreement. Consultant shall not, however,
be precluded from providing professional services to other customers so long
as the time spent does not interfere with the performance of his duties for
the Company.
8. CONFIDENTIAL INFORMATION
In the course of performing his services under this Agreement, the
Company will disclose to Consultant information, technical data and know-how
regarding the business affairs, services and products of the Company as well
as the Company's customers, which constitutes confidential information.
Confidential information, under this Agreement, shall consist of any and all
proprietary information and proprietary data related thereto, and any
derivative works thereof, including, but not limited to, research,
development, customer information, pricing information, knowledge of the
Company's financial condition, information and relationships with resources,
suppliers and customers of the Company, manufacturing processes, techniques,
methods, systems and trade secrets of the Company, its employees, or the
subsidiaries, affiliates, agents or customers, whether or not specifically
identified confidential. Consultant agrees to receive, hold and treat all
confidential information received from the Company as confidential and secret
and agrees to protect the secrecy of said confidential information, whether or
not specifically identified as confidential. Such confidential information
constitutes valuable, special and unique assets of the Company, and Consultant
agrees that the confidential information will be disclosed by the Consultant
only to those persons who are required to have such knowledge in connection
with their work for the Company and that such confidential information will
not be disclosed by Consultant to others without prior written consent of the
Company. As used herein, "persons required to have knowledge" shall include,
but not be limited to, the Board of Directors and such officers, employees and
agents of the Company or its affiliates, and such outside parties as are
legally entitled to such information (other than as a result of action by
Consultant not previously approved or authorized by the Board of Director of
the Company) and customers in banking, lending, collection and data processing
institutions, or agencies in the course of maintaining ordinary business
procedures of the Company. The provisions hereof shall not be applicable to:
(a) information which, at the time disclosure to Consultant is made, is a
matter of public knowledge or in the public domain; or (b) information which,
after disclosure to Consultant, becomes public knowledge or in the public
domain other than through a breach of the Agreement. Unless the confidential
information shall be of the type hereinabove set forth in the two immediately
preceding sentences, Consultant shall not use such confidential information
for his own benefit or for the benefit of third parties at any time. The
obligations imposed upon Consultant by this section shall survive the
expiration or termination of this Agreement.
9. INVENTIONS
Any and all inventions, conceptions, processes, discoveries,
improvements, patent rights, letter patents, programs, copyrights, trademarks,
trade names and applications therefor, in the United States and all other
countries, whether patentable or not, and any and all rights and interest in,
to and under the same, that are conceived, made, acquired, or possessed by
Consultant at the direction of or upon the express direction of the Company,
alone or with Company employees, during the term of this Agreement, shall
become the exclusive property of the Company and shall at all times and for
all purposes be regarded as acquired and held by Consultant in a fiduciary
capacity for the sole benefit of the Company, and Consultant hereby assigns
and agrees to assign the same to the Company without further compensation.
Consultant agrees that, upon request, he will promptly make all disclosures,
execute all applications, assignments or other instruments and perform all
acts whatsoever necessary or desired by the Company to vest and confirm in it,
its successors, assigns and nominees, fully and completely, all rights and
interests created or contemplated by this Section 9.
10. COMPANY PROPERTY
All products, records, designs, patents, plans, data, manuals, "field
guides", catalogs, brochures, memoranda, machinery, devices, lists and other
property delivered to Consultant by or on behalf of the Company or by its
customers (including, but not limited to, Company's customers solicited by
Consultant), and all records compiled by Consultant which pertain to the
business of the Company shall be and remain the property of the Company and be
subject at all times to its discretion and control. Consultant shall promptly
deliver to a designated representative of the Company all such Company
property, as well as any and all correspondence with customers and
representatives, reports, records, charts, advertising materials, and other
materials, and property in its possession or control which belong to the
Company upon termination of this Agreement.
11. WAIVER
The waiver by either party of a breach or violation of any provision of
this Agreement shall not operate as or be construed to be a waiver of any
subsequent or continuing breach hereof.
12. NOTICES
Any notices provided for in this Agreement shall be given in writing and
transmitted by personal delivery or prepaid first class registered or
certified U.S. mail addressed as follows:
Company: Simply Internet, Inc.
0000 Xxxxxxx Xxxxx, Xxxxx 0
Xxx Xxxxx, Xxxxxxxxxx 00000
With a copy to: SkyLynx Communications, Inc.
Attn: President/CEO
000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Consultant: Xxx X. Xxxxx
00000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Fax:
13. SUCCESSORS TO COMPANY
Except as otherwise provided herein, this Agreement shall inure to the
benefit of the Company and any successor of the Company, including, without
limitation, any corporation or corporations acquiring directly or indirectly
all or substantially all of the assets or business of Company whether by
merger, consolidation, sale or otherwise (and such successor shall thereafter
be deemed "Company" for the purposes of this Agreement), but shall not
otherwise be assignable by the Company. Any and all successors of the Company
shall be bound by this Agreement.
14. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
laws of the state of California.
15. CHOICE OF FORUM
The parties hereto agree that in the event that any legal suits, actions
or proceedings arising out of this Agreement are instituted by any party
hereto, such suits, actions or proceedings shall be instituted only in the
state or federal courts in the county of San Diego in the state of California.
The parties hereto do hereby consent to the jurisdiction of such courts and
waive any objection which they may now or hereafter have to the venue of any
such suits, actions or proceedings; provided, however, that any party hereto
shall have the right to institute proceedings in another jurisdiction if the
purpose of such proceedings is to enforce or realize upon any final court
judgment arising out of this Agreement.
16. CONSENT TO SERVICE
Service of any and all process which may be served on any party hereto in
any suit, action or proceeding related to this Agreement may be made by
registered or certified mail, return receipt requested, to Consultant or
Company at their respective addresses for notice as set forth in Section 12
and service so made shall be taken and held to be valid personal service upon
such party by any party to this Agreement on whose behalf such service is
made.
17. RESTRICTIVE COVENANT
Consultant will be bound by the terms of the Covenant not to Compete in
Article 7 Section 12 of the Asset Purchase Agreement.
18. WARRANTY AGAINST PRIOR AND FUTURE EXISTING RESTRICTIONS
Consultant represents and warrants to the Company that except with
respect to the restrictions set forth in the Asset Purchase Agreement, he is
not a party to any agreement containing a noncompetition clause or other
restriction with respect to the services he is required to perform pursuant to
this Agreement, or the use or disclosure of any information directly or
indirectly related to the Company's business, or to the services he is
required to render pursuant thereto and Consultant shall not enter into any
other consulting arrangement with any Internet Service Provider in the
Restricted Territory that would compete directly or indirectly with the
Company or its affiliates.
19. ENTIRE AGREEMENT
This Agreement constitutes the entire agreement between the parties,
superseding all prior understandings, arrangements and agreements, whether
oral or written and may not be amended except by a writing signed by the
parties hereto. As used herein, unless the context otherwise indicates, the
term "this Agreement" means the Agreement executed to be effective as of the
Effective Date and any written amendments thereof.
20. MODIFICATION AND WAIVER
No waiver or modification of this Agreement shall be valid unless it is
in writing and signed by the Company and Consultant. The waiver by either
party of a breach or violation of any provision of this Agreement shall not
operate as or be construed to be a waiver of any subsequent or continuing
breach hereof. The failure of any party to insist upon strict adherence to
any provision of this Agreement on one or more occasions shall not be
considered a waiver.
21. SEVERABILITY
In the event that any of the provisions of this Agreement shall be held
invalid or unenforceable by any court of competent jurisdiction, such
invalidity or unenforceability shall not affect that remainder of this
Agreement and same shall be construed as if such invalid or unenforceable
provisions had never been a part hereof. If a court of competent jurisdiction
determines that the length of time, geographical restrictions or any other
restriction, or portion thereof, set forth in this Agreement is overly
restrictive and unenforceable, the parties agree that the court shall reduce
or modify such restrictions to those which it deems reasonable and enforceable
under the circumstances, and as so reduced or modified, the parties hereto
agree that the restrictions of this Agreement shall remain in full force and
effect. In the event there is a breach by Company or Consultant of any other
provision of this Agreement, the covenants contained in Sections 8 and 20
shall remain in full force and effect.
IN WITNESS WHEREOF, Company has, by its appropriate officers, executed
this Agreement and Consultant has executed this Agreement on the 28th day of
April, 1999 to be effective as of the Effective Date.
SKYLYNX COMMUNICATIONS, INC.
By:
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Name:
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Title:
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CONSULTANT
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Xxx X. Xxxxx
