CONSULTING AND NON-COMPETITION AGREEMENT
This CONSULTING AND NONCOMPETITION AGREEMENT is made as of July 25, 2000,
between, YouthStream Media Networks, Inc. a Delaware Corporation (the
"Company"), and Xxxxxx X. Xxxxxxxxx (the "Consultant"), with reference to the
following facts.
The Company desires to employ the services of Consultant to advise the
Company on the i) Strategic direction of the Company; ii) Organization of
corporate structure; iii) Mergers and acquisition strategy; and iv) Corporate
culture("Consulting Services").
The Consultant desires to provide the Consulting Services.
In consideration of the foregoing recitals and the mutual covenants herein,
the parties agree as follows:
1. Consultancy: Acceptance. The Company hereby retains the Consultant and
the Consultant hereby accepts the Consultancy by the Company on the
terms and conditions hereinafter set forth.
2. Term. The duration of the contract is for two years, with an option by
the Company to terminate any time after six months, and an option by
the Consultant to terminate at any time. Termination by either party
shall be upon at least ten days prior written notice to the other
party. "Term" as used herein, shall refer to that period of time in
which the Consultant is engaged. For example, if the Consultancy is
terminated after six months, "Term" shall refer to the initial
six-month period.
3. Compensation. Compensation is to be paid at the rate of $150,000 per
annum in year one and $165,000 per annum in year two.
4. Other Benefits. The Company will provide the equivalent cash to
Consultant to pay for those benefits he would have otherwise received
as a full-time employee. As set forth on Exhibit A, this amount is
equal to $2,500 per month.
5. Competition and Intellectual Property. The Consultant acknowledges and
agrees that during the Term of this Agreement, Consultant will not
engage in the operation of any business which competes directly with
the Company's Existing Lines of Business. "Existing Lines of Business"
is defined herein as offline media properties targeted to the young
adult audience, including postcards, magazines, and digital theatres
on college campuses; online web sites whose primary focus is young
adult communities with an advertising and/or e-commerce revenue model,
including any technologies that define connectivity in terms of
peoples real life relationships with other people; and an Application
Service Provider business focused on bringing community tools to
new clients in furtherance of creating a web presence for such
clients. The Company acknowledges that Consultant is in the business
of starting new businesses, both as a principal and investor, and will
be working on new business creation during the Term of this
Consultancy with the Company, and unless such new business relates
directly to the business planned, (only to the extent that Consultant
is aware of such plans)or conducted by the Company, the Consultant
shall have no obligation to present any new business ideas to the
Company. The Company acknowledges and agrees that it shall have no
interest whatsoever in any new business created by Consultant, or with
any other business with which he may become involved in any capacity.
Company further acknowledges that all intellectual property created by
Consultant that does not compete with the Company's Existing Lines of
Business and not covered by paragraph 7, is owned solely by
Consultant.
6. Confidential Information. During the period of the non-compete (The
Term of this agreement) and at all times hereafter, Consultant shall
keep secret and retain in strictest confidence and shall not disclose
or facilitate any other person to disclose, and shall not, directly or
indirectly, use, permit or assist others to use, disclose or
communicate to any person or entity for the benefit of himself or
others any confidential data and information relating to the business
of the Company, unless such data information or information becomes
public knowledge, or unless Consultant is otherwise required by law to
disclose such data or information.
7. Intellectual Property Rights. Consultant agrees to inform and disclose
to the Company all work projects which he discovers, learns or creates
that relate to Company's Existing Lines of Business during the term of
the Consultancy. Consultant acknowledges that all intellectual
property, creations, inventions or discoveries of Consultant that
directly relate to Company's Existing Lines of Business are the sole
property of the Company and shall be considered "works for hire."
Consultant agrees that all work performed for hire under this
Consulting Agreement for Company are the sole property of the Company
and shall be considered "works for hire." Consultant agrees that all
work performed for hire the consulting agreement for Company are the
sale property of the Company and shall be considered "works for hire."
The Consultant further agrees to take any action necessary to protect
the Company's interest in this intellectual property, at the Company's
expense.
Company acknowledges that all intellectual property, creations,
inventions or discoveries of Consultant that do not directly relate to
Company's Existing Lines of Business, are the sole property of
Consultant.
8. Time Commitment. Consultant agrees to commit on average up to one and
one half days per week towards the Consultancy. Company and Consultant
may mutually agree that Consultant's services are best utilized
working more days consecutively with lengthy hiatuses between such
service.
9. Use of Office Facilities. Company will make available to Consultant a
laptop computer, cell phone, wireless device and other necessary
equipment in furtherance of the Consultancy.
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10. Termination. Upon termination, Consultant will keep laptop and other
communication devices used during the Consultancy.
11. Severability. The invalidity of unenforceability of any provision
hereof shall in no way affect the validity or enforceability of any
other provision hereof.
12. Governing Law. This Agreement shall be governed by and construed and
interpreted in accordance with the laws of the State of New York.
13. Arbitration. Company and Consultant agree that any dispute relating to
this Agreement or the matters covered hereby shall be resolved
exclusively by arbitration to be conducted only in the state of New
York, county of New York, in accordance with the rules of the American
Arbitration Association and applying the laws of New York State. Any
award rendered by the arbitrator shall be final and binding, and
judgment may be entered on it in any court of competent jurisdiction
in the county and state of New York or as otherwise provided by law.
14. Entire Agreement. All obligations from Company to Consultant and
Consultant to Company, which arose under Consultant's prior Employment
agreement with Company, are no longer in effect. The Agreement
contains the entire agreement of the parties and supersedes all prior
or contemporaneous negotiations, correspondence, understandings and
agreements between the parties, regarding the subject matter of this
Agreement. This Agreement may not be amended or modified except in
writing signed by both parties hereto and supported by new
consideration.
15. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of
which together shall constitute one and the same instrument.
"Consultant"
/s/ XXXXXX X. XXXXXXXXX
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Xxxxxx X. Xxxxxxxxx
"Company"
YouthStream Media, Inc.
/s/ XXXXX XXXXXXXX
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By: CEO
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Printed Name: XXXXX XXXXXXXX
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Title:
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EXHIBIT A
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BENEFIT PAID BY COMPANY POST-TAX DOLLARS PRE-TAX DOLLARS
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Social Security $ 11,250.00 $ 22,277.23
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COBRA $ 3,540.00 $ 7,009.90
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Disability $ 162.00 $ 320.79
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Life Insurance $ 198.00 $ 392.08
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Total Annual Benefits $ 15,150.00 $ 30,000.00
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Total Monthly Benefits $ 1,262.50 $ 2,500.00
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Pre-Tax refers to the pre-tax dollars necessary to provide the
post-tax benefit. This assumes a 38% federal tax bracket, and a
11.5% city and state tax bracket.
TAX BURDEN
Federal 38.0%
City 3.5%
State 8.0%
===============================================
Total Tax Burden 49.5%
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