EXHIBIT 10.14
AGREEMENT TO ENGAGE DANZIG LTD.
BUSINESS CONSULTANT FOR
FONEFRIEND, INC.
JANUARY 15, 2004
I. ENGAGEMENT
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FONEFRIEND, INC. ("FFRD") hereby engages and retains Danzig Ltd. ("Danzig") as a
Business Consultant for and on behalf of FFRD and its Affiliates to perform the
Services (as that term is hereinafter defined) and Danzig hereby accepts such
appointment on the terms and subject to the conditions hereinafter set forth and
agrees to use its best efforts in providing such Services.
II. INDEPENDENT CONTRACTOR
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X. Xxxxxx, in all respects, shall be deemed to be an independent contractor
in the performance of its duties hereunder, any law of any jurisdiction to the
contrary notwithstanding.
X. Xxxxxx shall not, by reason of this Agreement or the performance of the
Services, be or be deemed to be, an employee, agent, partner, co-venture or
controlling person of FFRD, and Danzig shall have no power to enter into any
agreement on behalf of or otherwise bind FFRD.
X. Xxxxxx shall not have or be deemed to have, fiduciary obligations or
duties to FFRD or its Affiliates and shall be free to pursue, conduct and carry
on for its own account (or for the account of others) such activities,
employments, ventures, businesses and other pursuits as Danzig in its sole and
absolute discretion may elect.
III. SERVICES
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A. As Business Consultant for FFRD, Danzig agrees to provide the following
consulting services (collectively the "Services"):
1. Identifying individuals and entities who are potential providers of
legal, accounting, investment banking and other services that are relevant to
the business objectives of FFRD;
2. Identifying potential sources of capital or financing for FFRD;
3. Assisting FFRD in efforts to seek additional business and business
relationships that will be of benefit to FFRD and its Affiliates; and
4. Such other services as FFRD may reasonably request, consistent with the
provisions of this Agreement.
X. Xxxxxx shall devote such time and effort to the affairs of FFRD as is
reasonable and adequate to render the Services contemplated by this Agreement.
X. Xxxxxx is not responsible for the performance of any services that
constitute the rendering of any legal opinions or performance of work that is in
the ordinary purview of a Certified Public Accountant.
X. Xxxxxx is not a broker-dealer, investment advisor, or associated person
of either, and hence is not responsible for the performance of any services that
would subject it to federal or state registration or licensing requirements
relating to broker-dealers, investment advisors and their associated persons.
X. Xxxxxx cannot guarantee results on behalf of FFRD, but shall pursue all
reasonable avenues available to successfully provide the Services contemplated
herein.
X. Xxxxxx and FFRD hereby confirm their express written intent that Danzig
shall only be required to devote such time to the performance of the Services as
Danzig shall deem necessary and proper to discharge its responsibilities under
this Agreement.
IV. EXPENSES
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It is expressly agreed and understood that Danzig's compensation as provided in
this Agreement does not include normal and reasonable out-of-pocket expenses,
which expenses (as described below) shall be pre-approved in writing by FFRD.
The expenses described in this paragraph shall be reimbursed by FFRD independent
of any fees described in the section below titled, "COMPENSATION."
A. "Normal and reasonable out-of-pocket expenses" shall include but are not
limited to: accounting, long distance communication, express mail, outside
consultants, travel (including: airfare, hotel lodging and meals,
transportation, etc.), and other costs involved in the execution of Danzig
Services under this Agreement.
B. FFRD also agrees to pay its own and Danzig's legal expenses in connection
with:
1. Danzig's performance of its Services under this Agreement, and
2. Any "Piggyback Registration Rights" of the Engagement Securities as
provided in Section V below.
C. FFRD hereby agrees to compensate Danzig promptly upon receipt of an
expense invoice from Danzig. Whenever feasible, Danzig will request advance
payment of approved expenses.
V. COMPENSATION
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In consideration for the Services, FFRD agrees that Danzig shall be entitled to
compensation as follows:
A. Upon the execution of this Agreement, Danzig will receive 150,000 shares
of FFRD common stock (the "Engagement Securities"), which shares shall be
subject to restrictive endorsement consistent with Rule 144 of the Securities
Act.
B. FFRD Board of Directors shall authorize the issuance of the Engagement
Securities upon the signing of this Agreement, and shall have such securities
delivered immediately to Danzig. However, in no event shall the Engagement
Securities be delivered later than seven (7) days from the date of the signing
of this Agreement.
C. Once issued, the Engagement Securities shall be deemed fully earned.
X. Xxxxxx shall have "Piggyback Registration Rights" to register the
Engagement Securities as part of any registration filing by FFRD and/or its
successors and assigns.
VI. REPRESENTATIONS, WARRANTIES AND COVENANTS
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A. EXECUTION. The execution, delivery and performance of this Agreement, in
the time and manner herein specified, will not conflict with, result in a breach
of, or constitute a default under any existing agreement, indenture, or other
instrument to which either FFRD or Danzig is a party or by which either entity
may be bound or affected.
B. NON-CIRCUMVENTION. FFRD hereby irrevocably agrees not to circumvent,
avoid, bypass, or obviate, directly or indirectly, the intent of this Agreement,
including avoiding payment of fees or other compensation to Danzig.
C. CONFIDENTIALITY. Danzig acknowledges that any and all knowledge or
information concerning FFRD, its affairs and business activity obtained by
Danzig, its principals, employees and/or contractors in the course of its
engagement hereunder is strictly confidential, and Danzig solemnly promises not
to reveal same to any other persons and/or entities, including, but not limited
to, competitors of FFRD and that it will not impart any such knowledge to anyone
whosoever during the term hereof or anytime thereafter. Further, Danzig agrees
not to partake, either itself or in conjunction with other third parties, in any
activities or dealings that would circumvent the business opportunities or best
interests of FFRD. All information, including but not limited to business
operations, software and other intellectual property rights, pertaining to FFRD
which is forwarded to, or otherwise obtained by Danzig hereunder, is to be
received in strict confidence and used only for the purposes of this Agreement
and not in circumvention of any economic opportunity or business relationship of
FFRD. The provisions of this Section VI C, shall survive the termination of this
Agreement.
D. CORPORATE AUTHORITY. Both FFRD and Danzig have full legal authority to
enter into this Agreement and to perform the same in the time and manner
contemplated.
E. AUTHORIZED SIGNATURES. The individuals whose signatures appear below are
authorized to sign this Agreement on behalf of their respective corporations.
F. PROPERLY ISSUED SHARES. When issued to Danzig, the Engagement Securities
shall be duly and validly issued, fully paid and non-assessable.
G. UNDERWRITER FEES. FFRD acknowledges and understands that Danzig is
neither a broker-dealer nor a registered investment advisor and FFRD may be
required to pay underwriting fees to an underwriter and/or funding entity in
connection with any offerings, underwritings or financings.
VII. TERM AND TERMINATION
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A. This Agreement shall be effective upon its execution and shall remain in
effect for a period of one year unless otherwise terminated as provided in this
Section VII.
B. At any time during the above-mentioned one-year period, FFRD or Danzig
shall have the right to terminate Danzig's engagement hereunder by furnishing
the other party with fifteen (15) days advance written notice of such
termination or such shorter advance notice as may be agreed-upon by FFRD and
Danzig.
C. Upon termination of this Agreement by FFRD, Danzig shall have the right:
1. To receive reimbursement for billed, accrued and/or unbilled
disbursements and expenses that have been pre-approved in writing by FFRD, which
right the parties hereby agree and consent is absolute; and
2. To keep all of the Engagement Securities or the monetary fee in full.
VIII. OTHER MATERIAL TERMS AND CONDITIONS:
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A. INDEMNITY. FFRD agrees to indemnify Danzig in accordance with Danzig's
standard indemnification provisions (the "Indemnification Provisions"), attached
to this Agreement as Exhibit "A" and incorporated herein and made a part hereof.
B. CONSEQUENTIAL DAMAGES. Except as expressly provided herein, Danzig shall
not, by reason of the termination of this Agreement or otherwise, be liable to
FFRD or its Affiliates for any special, incidental, consequential or punitive
damages such as, but not limited to, expenditures, investments or commitments
made in connection with the efforts by FFRD to acquire another entity or sell
all or a portion of its equity to another entity.
C. PROVISIONS. Neither termination nor completion of this Agreement shall
affect the Indemnification provisions that are incorporated herein, which shall
remain operative and in full force and effect.
D. ADDITIONAL INSTRUMENTS. Each of the parties shall from time to time, at
the request of others, execute, acknowledge and deliver to the other party any
and all further instruments that may be reasonably required to give full effect
and force to the provisions of this Agreement.
E. ENTIRE AGREEMENT. Each of the parties hereby covenants that this
Agreement is intended to and does contain and embody herein all of the
understandings and Agreements, both written or oral, of the parties hereby with
respect to the subject matter of this Agreement, and that there exists no oral
agreement or understanding expressed or implied liability, whereby the absolute,
final and unconditional character and nature of this Agreement shall be in any
way invalidated, empowered or affected. There are no representations,
warranties or covenants other than those set forth herein.
F. MEDIATION/ARBITRATION AGREEMENT. All disputes in any manner relating to
or arising out of this Agreement which the parties cannot resolve themselves
shall be resolved first through mediation, and second through arbitration before
a single experienced arbitrator, under the Commercial Rules of Arbitration of
the American Arbitration Association. The location of the arbitration shall be
determined by the party against whom relief is being sought. The decision or
award of any arbitrator shall be binding upon the parties and shall be
enforceable by judgment entered in a court having jurisdiction over the party
against whom enforcement is sought. In the event the arbitrator determines
there is a prevailing party in the arbitration, the prevailing party shall
recover from the losing party all costs of arbitration, including all fees of
the arbitration association and the arbitrator and all reasonable attorneys fees
incurred by the prevailing party. Any arbitrator appointed under this Agreement
shall have authority to order such equitable relief and such limited discovery
as may be appropriate under the circumstances.
G. ASSIGNMENTS. The benefits of this Agreement shall inure to the
respective successors and assigns of the parties hereto and of the indemnified
parties hereunder and their successors and assigns and representatives, and the
obligations and liabilities assumed in this Agreement by the parties hereto
shall be binding upon their respective successors and assigns; provided that the
rights and obligations of FFRD under this Agreement may not be assigned or
delegated without the prior written consent of Danzig, which consent shall not
be unreasonably withheld, or any purported assignment without such consent shall
be null and void.
H. ORIGINALS. This Agreement may be executed in any number of counterparts,
each of which so executed shall be deemed an original and constitute one and the
same Agreement. Facsimile copies with signatures shall be given the same legal
effect as an original.
I. ADDRESSES OF PARTIES. Each party shall at all times keep the other
informed of its principal place of business if different from that stated
herein, and shall promptly notify the other of any change, giving the address of
the new place of business or residence.
J. NOTICES. All notices that are required to be or may be sent pursuant to
the provision of this Agreement shall be sent by certified mail, return receipt
requested, or by overnight package delivery service to each of the parties at
the address appearing herein, and shall count from the date of mailing or the
validated air xxxx.
K. MODIFICATION AND WAIVER. A modification or waiver of any of the
provisions of this Agreement shall be effective only if made in writing and
executed with the same formality as this Agreement. The failure of any party to
insist upon strict performance of any of the provisions of this Agreement shall
not be construed as a waiver of any subsequent default of the same or similar
nature or of any other nature.
APPROVED AND AGREED AS OF THIS _____ DAY OF JANUARY, 2004.
FONEFRIEND, INC. DANZIG, LTD.
By: /s/ Xxxxxxxx Xxxxxx By: _____________________
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Xxxxxxxx Xxxxxx
Its: President Its: President
EXHIBIT A
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INDEMNIFICATION PROVISIONS
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FONEFRIEND, INC ("FFRD") agrees to indemnify and hold harmless Danzig, Ltd.
("Danzig"), its officers, employees and authorized agents (collectively,
"Danzig") against any and all losses, claims, damages, obligations, penalties,
judgments, awards, liabilities, costs, expenses and disbursements (incurred in
any and all actions, suits, proceedings and investigations in respect thereof
and any and all legal and other costs, expenses and disbursements in giving
testimony or furnishing documents in response to a subpoena or otherwise),
including without limitation, the costs, expenses and disbursements, as and when
incurred, of investigating, preparing or defending any such action, suit,
proceeding or investigation (whether or not in connection with any action in
which Danzig is a party), directly or indirectly, caused by, relating to, based
upon, arising out of, or in connection with Danzig's acting as a consultant for
FFRD (other than those caused by, relating to, based upon, arising out of, or in
connection with Danzig's gross negligence, misrepresentation or willful
misconduct), under the Agreement dated January 15, 2004, between FFRD and Danzig
to which these indemnification provisions are attached and form a part (the
"Agreement").
Such indemnification does not apply to acts performed by Danzig, which are
criminal in nature or a violation of any law. FFRD also agrees that Danzig shall
not have any liability (whether direct or indirect, in contract or tort, or
otherwise) to FFRD, for, or in connection with, the engagement of Danzig under
the Agreement, except to the extent that any such liability resulted primarily
and directly from Danzig's gross negligence, misrepresentation or willful
misconduct.
These indemnification provisions shall be in addition to any liability
which FFRD may otherwise have to Danzig or the persons indemnified below in this
sentence and shall extend to the following: Danzig, its affiliated entities,
partners, employees, legal counsel, agents and controlling persons (within the
meaning of the federal securities laws), and the officers, directors, employees,
legal counsel, agents, and controlling persons of any of them (collectively, the
"Danzig Parties"). All references to Danzig in these indemnification provisions
shall be understood to include any and all of the foregoing.
If any action, suit, proceeding or investigation is commenced, as to which
any of the Danzig Parties propose indemnification under the Agreement, they
shall notify FFRD with reasonable promptness; provided however, that any failure
by the party seeking indemnification to notify FFRD shall not relieve FFRD from
its obligations hereunder. The Danzig Parties shall have the right to retain
counsel of their own choice, which shall be reasonably acceptable to FFRD, to
represent them, and FFRD shall reimburse fees, expenses and disbursements of
such counsel; and such counsel shall, to the extent consistent with its
professional responsibilities, cooperate with FFRD and any counsel designated by
FFRD. FFRD shall be liable for any settlement of any claim against the Danzig
Parties made with FFRD's written consent, which consent shall not be
unreasonably withheld. FFRD shall not, without the prior written consent of the
party seeking indemnification, which shall not be unreasonably withheld, settle
or compromise any claim, or permit a default or consent to the entry of any
judgment in respect thereof, unless such settlement, compromise or consent
includes, as an unconditional term thereof, the giving by the claimant to the
party seeking indemnification of an unconditional release from all liability in
respect of such claim.
In order to provide for just and equitable contribution, if a claim for
indemnification pursuant to these indemnification provisions is made but it is
found in a final judgment by a court of competent jurisdiction (not subject to
further appeal) that such indemnification may not be enforced in such case, even
though the express provisions hereof provide for indemnification in such case,
then FFRD, on the one hand, and Danzig, on the other hand, shall contribute to
the losses, claims, damages, obligations, penalties, judgments, awards,
liabilities, costs, expenses and disbursements to which the indemnified persons
may be subject in accordance with the relative benefits received by FFRD, on the
one hand, and Danzig, on the other hand, and also the relative fault of FFRD, on
the one hand, and Danzig, in the other hand, in connection with the statements,
acts or omissions which resulted in such losses, claims, damages, obligations,
penalties, judgments, awards, liabilities, costs, expenses or disbursements and
the relevant equitable considerations shall also be considered. No person found
liable for a fraudulent misrepresentation shall be entitled to contribution from
any person who is not also found liable for such fraudulent misrepresentation.
Neither termination nor completion of the engagement of Danzig referred to
above shall effect these indemnification provisions which shall then remain
operative and in full force and effect.
