Exhibit
10.5
ADVISORY
AGREEMENT
This
Agreement (the “Agreement”), effective as of June 1st, 2021, (the “Effective Date”), is made by and
between SOS Hydration Inc. herein referred to collectively as (“Company”), and KHBH, LLC (“Advisor”).
For the purposes of this Agreement, Company and Advisor may sometimes herein be referred to collectively as the “Parties”
or individually as a “Party.”
WHEREAS,
Advisor is the business of providing consulting services on development, marketing, management and distribution of goods and services.
WHEREAS, Advisor has
the right to represent Xxxxx Xxxxxxxxxx (“KH”) WHEREAS, Company has a product line called SOS Hydration (“Business”)
WHEREAS, Company desires to
retain the services of Advisor to serve the Company as an independent contractor as defined below.
NOW, THEREFORE, in consideration
of the mutual promises contained in this Agreement and other good and valuable consideration, the
receipt of which is acknowledged by the Parties, the Parties agree as follows:
| 1. | APPOINTMENT
OF ADVISOR. |
| a. | Company
hereby engages Advisor to act as a brand ambassador and consult on growth strategy for Business,
which may include advising on the following: launch planning, marketing, advertising, public
relations, press, media, influencer and celebrity marketing, strategic partnerships, cross-promotional
strategies, revenue models, key introductions to vendors, partners, marketers, and general
business. This shall include regular advisory calls, video conferences, and email correspondence
with KH and team. Company shall serve on the Company Board of Advisors, KH shall appear in
various marketing videos/collateral for the Company, Advisor shall make posts on KH social
media networks on a mutually agreeable regular basis about the Company. Any travel requested
by Company must be made in writing at least thirty (30) days in advance and is subject to
Advisor’s availability. |
| b. | KH
shall personally appear in mutually agreeable video, digital, and written content. Advisor
reserves the right to approve any and all materials to be utilized that will contain the
name and likeness of the Advisor and/or KH, including but not limited to press releases,
video, audio, marketing materials and financial plans. All rights granted to the Company
including but not limited to the use of Advisor and KH’s name, brand or likeness shall
cease after any term or termination of this agreement. |
| c. | By
the 10th of each month, Advisor shall provide a
brief recap of Advisor’s prior month activities as it relates to the Company. |
| a. | Term.
This Agreement shall be effective for a period of Six (6) months, and automatically renew
every 6 months, unless either party gives at least 15 day prior notice before the 6 month
anniversary date from the singing or renewal of this Agreement. |
| b. | Termination.
During the term the Parties shall have the following rights to terminate this Agreement: |
| i. | Advisor
shall have the option to terminate this Agreement in the event the Company breaches any term
of this agreement, fails to timely pay any or all amounts due under this Agreement, ceases
to do business, becomes subject to any government regulatory investigations, penalties or
failure to comply with local, state and/or federal laws, becomes subject to a claim or lawsuit
involving mismanagement, misrepresentation, fraud or engages in an activity that Advisor
determines that will negatively affect Advisor’s name or brand or Company has filed
for bankruptcy, dissolution or an assignment for the benefit of creditors. In the event of
the Company’s breach of any term of this Agreement beyond any cure periods, Advisor
shall retain all economic benefits contained in this Agreement for the remainder of that
specific 6 month term. |
| ii. | Company
shall have the option to terminate this Agreement in the event that Advisor breaches any
term of this agreement, ceases to do business, is convicted of a felony, or has filed for
bankruptcy, dissolution or an assignment for the benefit of creditors. Further, the Parties
understand that SOS has the right to terminate the Agreement at its complete
discretion before the expiration of each 6 month term. If Company terminates the Agreement,
all economic benefits shall continue through the remainder of that 6 month term. |
| iii. | Notwithstanding
the above, each of the Parties hereto shall have ten (10) days to cure any alleged breach
of any term of this Agreement. The notice shall be in writing and delivered to the other
party through electronic or other courier service. |
| iv. | Upon
Termination of this Agreement, Company must stop the use of Advisor and Xxxxx Xxxxxxxxxx
branding, videos, name, and likeness. |
| 2.1 | Compensation
for Services: Advisor shall receive the following: |
| a. | Company
shall pay to Advisor a fee of fifteen thousand dollars $(15,000) per month. |
| b. | For
any new retail, wholesale, or distribution business introduced by Advisor, Company shall
pay Advisor a royalty fee of four percent (4%) of “Net Sales” for that specific
business introduced to the Company. “Net Sales” shall be defined as gross revenues
received by the Company minus direct slotting and promotion fees for those respective introduced
accounts or businesses. Any royalties shall continue past the Term of this Agreement, for
as long as the Company is still doing business with introduced third parties. |
| c. | Advisor
shall receive ten percent (10%) equity interest in the company (490,000 shares of common
stock), in the form of cashless warrants priced at the fair market value of the Company
at the signing of this Agreement, of $20 million, vested according to this schedule: 25%
of the warrants issued (122,500 shares of common stock) upon signing of this Agreement, 25%
at the 6 month anniversary of this Agreement, 25% at the 12 month anniversary of this Agreement,
25% at the 18 month anniversary of this Agreement. These warrants, when vested, shall not
have a termination date and will survive the termination of this Agreement. If the Agreement
is terminated, Advisor only has right to the warrants which have been earned through the
current Term of the Agreement. |
| d. | In
the event of the expiry or termination of this Agreement, Advisor shall be entitled to retain
all fees paid and warrants vested at the time of expiry or termination of the Agreement. |
| a. | Generally.
Advisor will keep all information obtained from the Company (the “Information”)
confidential. Advisor may disclose Information to its officers, directors, employees, agents
and representatives, and to its other advisors and financial sources on a need to know basis
only and will ensure that all such persons will keep the Information strictly confidential. |
| b. | Exceptions.
No obligation of confidentiality shall apply to Information that: |
| (i) | is
in the public domain or enters the public domain without a breach by Advisor;(ii) was known
or became known by Advisor prior to the Company’s disclosure thereof to Advisor; |
| (ii) | becomes
known to Advisor from a source other than the Company, and other than by the breach of an
obligation of confidentiality owed to the Company; |
| (iii) | is
disclosed by the Company to a third party without restrictions on its disclosure; |
| (iv) | is
independently developed by Advisor; or |
| (v) | is
required to be disclosed by Advisor or their respective officers, directors, employees, agents,
attorneys or its other advisors and financial sources, pursuant to any order of a
court of competent jurisdiction or other governmental body or as may otherwise be required
by law. |
| 3.2. | Indemnification.
Company, its agents or assigns, hereby agree to indemnify, defend and hold Advisor harmless
from all losses, claims, damages, liabilities, costs or expenses, including reasonable attorney's
fees, joint and several (herein collectively. “Claims”), arising from the performance
of this Agreement, whether or not Advisor is party to such dispute. Advisor shall indemnify
and hold Company, its affiliates, officers, employees and agents harmless from and against
all Claims arising from its performance hereunder, which have given rise to such liability.
Pending any final determination of liability hereunder, the indemnification and reimbursement
provision of this Agreement shall apply to each
of the Parties and each shall perform its obligation hereunder to defend and reimburse the
other for its expenses. |
| 3.3. | Warranty:
Each Party warrants that it will remain in compliance with all federal, state and local laws,
regulations, and ordinances as it relates to marketing and distribution as provided in this
Agreement. Further, each Party shall provide prompt notice to the other of receipt of any
notice of any claim or actions regarding the above. Company further warrants that it shall
fund all approved purchase orders and growth initiatives. Company understands that there
will be third party commissions payable to agreed upon sales representatives and Company
shall keep current with all such payments to maintain Advisor’s business relationships. |
| 4.1. | Independent
Contractor. Advisor and Company hereby acknowledges that Advisor is an independent contractor.
Advisor shall not hold itself out, as, nor shall it take any action from which others might
infer that it is agent of or a joint venture of Company. |
| 4.2. | Partial
Invalidity. If any part of this Agreement shall be determined by a court or mediator
to be invalid, the remainder hereof shall be construed as valid and as if the invalid portion
has been omitted. |
| 4.3. | Assignment.
None of the Parties shall assign this Agreement without the written consent of the other
Parties. |
| 4.4. | Waiver.
No waiver of any of the provisions of this Agreement shall be deemed or shall constitute
a waiver of any other provision, whether or not similar, nor shall any waiver constitute
a continuing waiver. No waiver shall be binding unless executed in writing by the Party making
the waiver. |
| 4.5. | Dispute
Resolution. The Parties shall attempt to resolve any dispute arising out of or relating
to this Agreement through amicable negotiations amongst the parties. If the matter is not
resolved by negotiation, the Parties shall resolve the dispute using the procedures noted
in Section 4.6. |
| 4.6. | Mediation
and Arbitration. Any controversy or dispute
arising out of or relating to this Agreement shall be submitted to mediation in accordance
with any statutory rules in the state of California. If mediation is not successful in resolving
the entire dispute or is unavailable, any outstanding issues will be submitted to final and
binding arbitration under the rules of the American Arbitration Association. The arbitrator’s
award will be final, and judgment may be entered upon it by any court having proper jurisdiction
within the state of California. |
| 4.7. | Choice
of Law and Venue. This Agreement shall be governed by and construed in accordance with
the laws of the State of California. |
| 4.8. | Miscellaneous.
This Agreement sets forth the entire understanding of the Parties relating to the subject
matter hereof and supersedes and cancels any communications, prior understandings and agreements
between the Parties. This Agreement is non-exclusive and cannot be modified or changed, nor
can any of its provisions be waived, except by written agreement signed by all Parties. In
the event of any dispute as to the terms of this Agreement, the prevailing Party in any litigation
shall be entitled to recover its reasonable attorney's fees and costs. |
| 4.9. | Notices.
Any notice required or permitted hereunder shall
be given in writing and shall be deemed effectively given upon personal delivery or five
business days after deposit in the United States Postal Service, by (a) advance copy by fax,
(b) mailing by express courier or registered or certified mail with postage and fees prepaid,
addressed to each of the other Parties entitled at the following addresses, or at such other
addresses as a Party may designate by ten days advance written to each of the other Parties
hereto: |
Company:
SOS Hydration Inc,
000 Xxxxxx Xxxxxx,
#00000 Xxx Xxxxxxxxx, XX 00000
Advisor:
KHBH, LLC
000
0xx Xxx X Xxx 000 Xx. Xxxxxxxxxx, XX 00000
| 4.10. | Entire
Agreement. This Agreement supersedes any and all other agreements, either written or oral,
between the Parties hereto with respect to the services of Advisor to the Company as it relates
to the subject matter of this Agreement. |
| 4.11. | Amendment.
All Parties to this Agreement must sign any modifications to this Agreement. |
IN WITNESS WHEREOF, the
fully authorized officers of the Parties have set their respective hands hereto:
SOS Hydration Inc.:
By: /s/Xxxxx Xxxx
Xxxxx Xxxx, CEO and Founder
KHBH,
LLC:
By: /s/Xxxxx Xxxxxxxxxx
Xxxxx Xxxxxxxxxx, CEO &
President
