Exhibit 10.20
BUSINESS CONSULTING AGREEMENT
AGREEMENT, made as of this 19th day of March 1999 by and between METRO
GLOBAL MEDIA, INC., a Rhode Island corporation having is principal place of
business at 0000 Xxxx Xxxxxx, Xxxxxxxx, Xxxxx Xxxxxx 00000, hereinafter the
"Company," and XXXXXXX X. XXXXXXX, residing at 00 Xxxx Xxxxxx, Xxxxxxxx, Xxxxx
Xxxxxx 00000, hereinafter the "Consultant".
WHEREAS, the Company is a public company required to file reports pursuant
to the Securities Exchange Act of 1934, as amended, and is current in its
reporting requirements; and
WHEREAS, the Consultant is in the business of providing management
consulting services and his services have been used in the past on a
deal-to-deal basis; and
WHEREAS, the Company desires to retain the Consultant to perform management
consulting services in connection with the Company's business affairs on a
non-exclusive basis, and the Consultant is willing to undertake to provide such
services on that basis and as hereinafter set forth.
NOW, THEREFORE, the parties agree as follows:
1. TERM: The term of this Agreement shall be one (1) years from April 1,
1999 through March 31, 2000.
2. NATURE OF SERVICES: The Consultant will use his best efforts and render
advice and assistance to the Company on business-related matters (all of which
services are hereinafter collectively referred to as the "Program"), and in
connection therewith, the Consultant shall:
a. Attend meetings of the Company's Board of Directors, Executive
Committee, and Financial Committee(s) when so requested by the Company.
b. Attend meetings and at the request of the Company, review, analyze and
report on proposed business opportunities. These meetings are to include
operations and production meetings when the Company deems necessary.
c. Consult with the Company concerning on-going strategic corporate
planning and long-term investment policies, including any revisions of the
Company's business plan.
d. Consult with and advise the Company with regard to potential mergers and
acquisitions, whether the Company is the acquiring company or the target of
acquisitions.
e. Assist in the preparation and distribution of press releases when so
requested by the Company to be distributed to the press, news services,
customers, suppliers, selected NASD broker/dealers, financial institutions and
the Company's shareholders.
f. Consultant has no authority to bind the Company and his sole duties are
to report recommendations to the Company's Board of Directors.
Anything to the contrary herein notwithstanding, it is recognized and
agreed that the Consultant's services will not include any service that
constitutes the rendering of legal opinions, performance of work that is in the
ordinary purview of a certified public accountant, or any work that is in the
ordinary purview of a registered securities broker/dealer.
3. COMPENSATION: As full payment for his services set forth above, the
Consultant shall receive One Hundred Twenty Thousand Dollars ($120,000), payable
in increments of Ten Thousand Dollars ($10,000) per month beginning April 1,
1999.
In addition, the Company shall issue to the Consultant options to purchase
100,000 shares of the Company's free-trading, common stock (the "Option") which
shall be exercisable for a period of five (5) years from the date of this
agreement at $2.00 per share (the average 10-day closing price prior to the date
of this Business Consulting Agreement).
Upon issuance of the Option, the Company shall prepare and file a
registration statement on Form S-8 (the "Registration Statement") with the
Securities and Exchange Commission registering the shares to be issued upon
exercise of the Option (the "Shares").
a. The Company and the Consultant hereby agree that, notwithstanding the
fact that the Option and Shares are being registered in the S-8 Registration
Statement in the name of the Consultant, in light of the Company's agreement to
file the S-8 Registration Statement, the Consultant hereby consents to delay the
delivery of the Option until the filing of the S-8.
b. Once delivery of the Option is made, the Option delivered shall be
deemed the sole and exclusive property of the Consultant, and the Company shall
be obligated to deliver the Shares upon exercise. The Option is not transferable
without the prior written consent of the Company.
4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY:
The Company represents and warrants to Consultant each such representation
and warranty being deemed to be material, that:
a. The Company will cooperate fully and timely with the Consultant to
enable the Consultant to perform his activities and obligations under the
Agreement.
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b. The execution and performance of this Agreement by the Company has been
authorized by the Board of Directors of the Company in accordance with
applicable law.
c. The entry into and the performance by the Company of this Agreement will
not violate any applicable court decree, law or regulation, nor will it violate
any provision of the organizational documents of the Company or any contractual
obligation to which the Company may be bound.
d. Since the Consultant will rely upon information being supplied him by
the Company, all such information shall be true, accurate, complete and not
misleading, in all material respects.
e. The Shares, when issued upon the exercise of the Option, will be duly
and validly issued, fully paid and non-assessable with no personal liability to
the ownership thereof.
f. The Company will act diligently and promptly in reviewing materials
submitted to it by the Consultant to enhance the timely distribution of such
materials and will inform the Consultant of any material inaccuracies contained
therein prior to dissemination.
g. The Company will initiate and complete a registration statement on Form
S-8 and will fully comply with any and all applicable provisions of the Federal
and State Securities Laws. In the event law prohibits the Company from
registering securities on Form S-8, the Company will register Consultant's
shares pursuant to an alternative registration method.
5. REPRESENTATIONS AND WARRANTIES OF CONSULTANT: By virtue of his execution
hereof, and in order to induce the Company to enter into this Agreement, the
Consultant hereby represents and warrants to the Company as follows:
a. The Consultant has full power and authority to enter into this
Agreement, to enter into a consulting relationship with the Company as provided
for and described herein, and to otherwise perform this Agreement in the time
and manner contemplated.
b. The Consultant has the requisite skill and experience to perform the
services contemplated by this Agreement, to create and implement the Program,
and to carry out and fulfill his duties and obligations hereunder.
c. The Consultant is not an officer, director, shareholder, control person,
principal or affiliate of any underwriter, broker or finders which is doing or
has done business with or on behalf of the Company.
d. The Consultant hereby acknowledges, agrees and accepts that pending
delivery of the Option and thereafter during and throughout the entire term of
this Agreement, he shall be exclusively responsible for the payment of any
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expenses relating to the Program, at the sole expense of the Consultant unless
otherwise approved by the Company.
e. The Consultant will make no representation that he has the authority to
bind the Company in any matter whatsoever.
6. LIABILITY OF CONSULTANT: In furnishing the Company with management
advice and other services as herein provided, neither the Consultant, nor any
employee or agent thereof, shall be liable to the Company or its creditors for
error of judgment or for anything except malfeasance, bad faith or gross
negligence in the performance of his duties, or reckless disregard of his
obligations and duties under this Agreement.
It is further understood and agreed that Consultant may rely upon
information furnished to him by the Company reasonably believed to be accurate
and reliable and that, except as herein provided, the Consultant shall not be
accountable for any loss suffered by the Company by reason of the Company's
action or non-action on the basis of any advice, recommendation or approval of
the Consultant, his employees or agents.
The parties further acknowledge that the Consultant undertakes no
responsibility for the accuracy of any statement made by management contained in
press releases or other communications, including, but not limited to, filings
with the Securities and Exchange Commission and the National Association of
Securities Dealers, Inc.
7. STATUS OF CONSULTANT: The Consultant is an independent contractor and
has no authority to bind the Company without the approval from the Board of
Directors. The Consultant shall not have, nor be deemed to have, any fiduciary
obligation or duties to the Company.
8. OTHER ACTIVITIES OF CONSULTANT: The Company recognizes that the
Consultant now renders, and may continue to render, consulting and advisory
services to other companies which may or may not have policies and conduct
activities similar to those of the Company. The Consultant shall be free to
pursue, conduct and carry on for the Consultant's own account (or for the
account of others) such activities, employment, ventures, businesses and other
pursuits as the Consultant in his sole, absolute and unfettered discretion, may
elect, provided the Consultant and any such activities by him or on his behalf
do not violate Paragraph 10 of this Agreement, or any other provision hereof.
9. DISCLAIMER BY CONSULTANT: The Consultant will prepare certain materials
for the Company. Consultant makes no representation that his services will
result in any enhancement of the Company.
10. CONFIDENTIALITY: Until such time as it may be publicly disclosed, the
Consultant agrees that any information, materials or documents provided by the
Company will not be revealed or disclosed to the public or any third person,
except in the performance of this Agreement and with the Company's consent. Upon
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completion of the term of this Agreement and at the written request of the
Company, the Consultant will return any original documentation provided by the
Company to the Consultant. The Consultant will require similar confidentiality
agreements from his employees and/or agents where he reasonably believes they
will come in contact with confidential material.
11. MISCELLANEOUS:
a. The Company shall make all final decisions with respect to consultation,
advice and services rendered by the Consultant.
b. This Agreement contains the entire agreement of the parties hereto and
there are no agreements, representations or warranties other than those
contained herein. Neither party may modify this Agreement unless in writing and
signed by both parties.
c. This Agreement shall be governed by and construed in accordance with the
laws of the State of Rhode Island.
d. Any controversy or claim under, arising out of, or related to this
Agreement shall be settled by arbitration in accordance with the rules and under
the auspices of the American Arbitration Association to be conducted in Rhode
Island.
e. This Agreement shall supersede and replace all previous agreements
between the parties, both written and oral.
12. NOTICES: All notices and other communications hereunder shall be in
writing and shall be deemed to have been given if delivered in person or sent by
prepaid first class registered or certified mail, return receipt requested to
the last known address of any party hereto.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement effective
as of the day and year first above written.
METRO GLOBAL MEDIA, INC.
By: /s/ A. Xxxxxx Xxxxxx /s/ Xxxxxxx X. Xxxxxxx
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A. XXXXXX XXXXXX XXXXXXX X. XXXXXXX
Board Member
By: /s/ Xxxx Xxxxxx
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XXXX XXXXXX
Board Member
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