EXHIBIT 99.1
MANAGEMENT CONSULTING AGREEMENT
THIS MANAGEMENT CONSULTING AGREEMENT (this "Agreement") is made as of
the 15th day of May 2003 (the "Effective Date") between AUGRID CORPORATION with
its principal address at 0000 X. 00xx Xxxxxx, 0xx Xxxxx, Xxxxxxxxx, Xxxx 00000
(together with its subsidiaries and affiliates the "Company") and XXXX XXXXX., a
New York consultant with his principal address at 0 Xxxxx Xxxx #000 Xxxxxxx
Xxxxx X.X. 00000 (the "Consultant").
BACKGROUND
The Company and the Consultant wish to have the Consultant provide
general corporate, financial and management advisory services to the Company, on
the terms and conditions set forth in this Agreement.
Accordingly, the parties intending to be legally bound agree as
follows:
1. APPOINTMENT. The Company hereby engages the Consultant to provide the
consulting services as described in Sections 2.
2. CORPORATE SERVICES.
2.1 During the Term and any Renewal Term, the Consultant will, upon
request, provide to the Company the Corporate Services on an "as
needed" basis, including, but not limited to, those described
below:
(a) assisting management in developing its business plan and
recapitalization plan;
(b) assisting management in various day-to-day administrative and
operational tasks;
(c) assisting management regarding accounting procedures, financial
budgets and other financial matters;
(d) overseeing the Company's relationship with its outside
professionals (i.e. ; legal, accounting, investor relations,
etc.) and recommending, when appropriate, new professionals
(e) identifying appropriate new management, advisors and Board
personnel as necessary;
(f) assisting management in connection with identifying, evaluating
and negotiating potential investments, acquisitions, strategic
partnerships and/or licensing opportunities for the Company and
its products and services (each a "Strategic Transaction"); and
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(i) providing such other related consulting services as requested by
Management AND MUTUALLY AGREEABLE TO THE CONSULTANT.
2.2 STAFFING. The Consultant will maintain in its employ, or
otherwise have available to it, personnel sufficient in number
and adequate in ability to perform the Corporate Services in
accordance with this Agreement. The Consultant will have the
exclusive right to direct and control its personnel and/or third
parties providing the Corporate Services, other than in respect
of the Company's right, as the recipient of the Corporate
Services, to supervise the performance of the Consultant under
this Agreement.
2.3 NON-EXCLUSIVITY. The Company expressly understands and
agrees that the relationship with the Consultant is on a
non-exclusive independent contractor basis for the Corporate
Services and that the Consultant shall not be prevented, barred
or limited from rendering consulting services of the same nature
or of a similar nature to those described in this Agreement, or
of any nature whatsoever, for or on behalf of any person, firm,
corporation, or entity other than the Company during the Term
and any Renewal Term
2.4 PLACE OF PERFORMANCE. In connection with the Corporate Services
performed by the Consultant, the Consultant's activities shall
be principally based in its New York City office, except for
required and approved travel on the Company's behalf.
3. TERM AND TERMINATION.
3.1 TERM. Unless terminated earlier under Section 3.2 (a) below, the
term of this Agreement will be six (6) months (the "Term")
commencing on the Effective Date. The Term may be renewed for an
additional six (6)-month period (the "Renewal Term") upon terms
and conditions mutually agreed upon at least thirty (30) days
prior to the end of the Term.
4. COMPENSATION
4.1 MONTHLY FEE. During the Term and any Renewal Term, as
compensation for the Services provided in Section 2 hereof (in
addition to any fees that may be earned for a Strategic
Transaction as set forth in Section 5 below), the Consultant
shall be paid a fee of $5,000 per month (the "Consulting Fee").
If the Company can not pay the $5,000 per month, then the
Company will provide 6,000,000 freely tradable shares within an
appropriate time frame determined by both parties. Consultant
agrees upon acceptance of the registered shares that this
agreement as payment for the full six month term of this
agreement.
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EXPENSES. The Consultant shall be promptly reimbursed for all
reasonable out-of-pocket expenses (including travel,
entertainment, etc.) incurred by it in its performance under
this Agreement, upon submission of documentation supporting such
expense(s).The consultant shall not incur any expense over
$1,000.00 dollars without the consent of the Company prior to
execution.
5. STRATEGIC TRANSACTION SERVICES
The Consultant, or an affiliate, may provide the Company, if so requested, with
finder services which may include the identification and introduction to the
Company of parties that would be interested in completing an acquisition,
strategic partnership joint venture and/or licensing opportunity ("Strategic
Transaction") with the Company. Accordingly, if the Consultant introduces the
Company (or any of its subsidiaries or affiliates) to a party that, during the
Term, any Renewal Term or during the one (1) year period following the
Termination Date, completes, or enters into a letter of intent to complete, a
Strategic Transaction (as set forth below) in which;
a) the introduced party enters into a partnership, joint
venture, or licensing agreement or any other agreement for the
mutual exploitation of any asset of the Company; and/or
b)the Company merges with or acquires the introduced party, or,
the introduced party merges with or acquires the Company.
The Company will pay to the Consultant a negotiated fee with respect to each and
every transaction undertaken by the Company with each party during such time
period, that will be mutually agreed to prior to such introduction and which
will reflect a customary industry fee arrangement.
6. INDEMNIFICATION.
6.1 INDEMNIFICATION BY THE COMPANY. If in connection with any
services or matters that are the subject of arise out of this
Agreement or the Consultant's engagement hereunder, the
Consultant or any of its directors, officers, stockholders,
employees of agents (collectively, the "Consultant Indemnitees")
becomes involved (whether or not as a named party) in any
action, claim, investigation or legal proceeding, the Company,
will indemnify and save harmless such Consultant Indemnitees
from and against any and all claims, liabilities, damages,
losses, costs and expenses (including amounts paid in
satisfaction of judgments in compromises and defending against
any claims or alleged claims) of any nature whatsoever,
liquidated or unliquidated, that are incurred by any Consultant
Indemnitees' obligations under this Agreement unless the claim
or alleged claim resulted from willful misconduct, negligence or
fraud of the Consultant Indemnitees. The Company agrees that,
without the Consultant Indemnitees' prior written consent, it
will not settle,
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compromise or consent to the entry of any judgment in any
pending or threatened claim, action or proceeding in respect of
which indemnification could be sought under this Section 6
(whether or not the Consultant Indemnitees are actual or
potential parties to such claim, action or proceeding), unless
such settlement, compromise or consent includes an unconditional
release of each Consultant Indemnitee from all liability arising
out of such claim, action or proceeding.
6.2 INDEMNIFICATION BY THE CONSULTANT. If in connection with any
services or matters that are the subject of arise out of this
Agreement or the Consultant's engagement hereunder, the Company
or any of its directors, officers, stockholders, employees of
agents (collectively, the "Company Indemnitees") becomes
involved (whether or not as a named party) in any action, claim,
investigation or legal proceeding, the Consultant, will
indemnify and save harmless such Company Indemnitees from and
against any and all claims, liabilities, damages, losses, costs
and expenses (including amounts paid in satisfaction of
judgments in compromises and defending against any claims or
alleged claims) of any nature whatsoever, liquidated or
unliquidated, that are incurred by any Company Indemnitees'
obligations under this Agreement unless the claim or alleged
claim resulted from willful misconduct, negligence or fraud of
the Company Indemnitees. The Consultant agrees that, without the
Company Indemnitees' prior written consent, it will not settle,
compromise or consent to the entry of any judgment in any
pending or threatened claim, action or proceeding in respect of
which indemnification could be sought under this Section 6
(whether or not the Company Indemnitees are actual or potential
parties to such claim, action or proceeding), unless such
settlement, compromise or consent includes an unconditional
release of each Company Indemnitee from all liability arising
out of such claim, action or proceeding.
6.3 PROCEDURES. As to any claim or lawsuit with respect to which
party seeks indemnification hereunder (the "Indemnified Party"),
it shall provide prompt notice thereof to the other party (the
"Indemnifying Party"), and the Indemnifying Party shall have the
right to control the defense of said lawsuit, including the
selection of attorneys, and any settlement thereof, provided
that no settlement which impairs the rights of the Indemnified
Party shall be made without its prior written consent, which
consent shall not be unreasonably withheld.
7. BINDING ARBITRATION.
a) Any dispute not settled through mediation will be settled by
binding expedited arbitration in accordance with the commercial
Arbitration Rules of the American Arbitration Association (the
"AAA Arbitration Rules") in effect from time to time. Where no
remedy for a particular breach is specified in this Agreement,
the arbitrator, subject to any limitations set forth in the
applicable
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agreement, will have the power to fashion an appropriate remedy
consistent with the spirit and intent of this Agreement. Any
disputing party may serve the other disputing party or parties
with a demand to commence binding arbitration ("Arbitration
Demand"). The arbitrator will be selected by mutual agreement of
the disputing parties. If the disputing parties are unable to
agree upon an arbitrator within 20 days after the date on which
the Arbitration Demand is served, then the Arbitrator will be
selected in accordance with the AAA Arbitration Rules.
b) The arbitration will be held in New York County and be governed
by the laws of the State of New York, and judgment upon the
award rendered by the arbitrator may be entered by any court
having jurisdiction thereof. The disputing parties will
cooperate fully to ensure the entry of the arbitrator's award by
a court of competent jurisdiction. Once the arbitrator's award
has been entered by a court of competent jurisdiction, the
arbitrator's award will have res judicata and collateral
estoppel effect, and the disputing parties will not seek or
assert the right in any manner whatsoever to challenge the
validity of the arbitration or relitigate issues adjudicated by
the arbitrator.
8. COVENANTS
8.1 CONFIDENTIALITY. With respect to information of the Company,
which is clearly marked "Confidential", whatever its nature and
form and whether from Graphic Materials (as defined below) or
otherwise (except such as is generally available through
publication or is previously known to the Consultant, or is
lawfully obtained by the Consultant through a third-party),
obtained by the Consultant during or as a result of its
consultancy with the Company and relating to any invention,
improvement, enhancement, product, know-how, formula, software,
process, design, or other creation, or to any use of any of
them, costs (including, without limitation, manufacturing
costs), prices, or to any plans of the Company, or to any other
trade secret or proprietary information of the Company, the
Consultant agrees:
a) to hold all such information, inventions and discoveries which
have not otherwise become public knowledge in strict confidence
and not to publish or otherwise disclose any thereof to any
person or entity other than the Company except with the prior
written consent of an officer of the Company, or as may be
required by law.
b) to take all reasonable precautions to assure that all such
information, inventions and discoveries are properly protected
from access by unauthorized persons.
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c) to make no use of nor exploit in any way any such information,
invention or discovery except as required in the performance of
its consultancy for the Company.
For the purposes of this Agreement, the term "Graphic Materials" includes,
without limitation, letters, memoranda, reports, notes, notebooks, books of
account, drawings, prints, specifications, formulae, software, data print-outs,
microfilms, magnetic tapes and disks and other documents and recordings,
together with all copies, excerpts and summaries thereof.
8.2 FURTHER ASSURANCES. The Company and Consultant will use their
best efforts to implement the provisions of this Agreement, and
for such purpose neither party shall represent to the other any
material facts concerning itself during the Term and any Renewal
Term which are false, misleading or untrue and neither party
shall intentionally fail to provide the other with material
facts concerning itself or will in any material manner prevent
the Services from being performed under this Agreement.
9. MISCELLANEOUS.
9.1 LIMITATION OF LIABILITY. IT IS UNDERSTOOD BETWEEN THE PARTIES
THAT NEITHER THE CONSULTANT NOR ANY OF ITS PARTNERS, EMPLOYEES,
AGENTS, OR PRINCIPALS ARE PROVIDING LEGAL SERVICES, AUDITING
SERVICES, NOR BROKERAGE SERVICES, AND SUCH SERVICES MUST BE
RETAINED BY THE COMPANY AT ITS OWN COST AND EXPENSE. IT IS
EXPRESSLY ACKNOWLEDGED THAT THE CONSULTANT WILL UTILIZE ITS BEST
EFFORTS IN PERFORMING THE SERVICES CONTEMPLATED HEREBY BUT NO
REPRESENTATIONS ARE MADE OR GUARANTEE GIVEN BY THE CONSULTANT AS
TO THE AMOUNT OF TIME IT WILL SPEND IN PROVIDING THE SERVICES
NOR TO THE ULTIMATE SUCCESS OF ANY SERVICE, TRANSACTION OR OTHER
ACTION UNDERTAKEN BY THE COMPANY. IN NO EVENT WILL THE AGGREGATE
DAMAGES CLAIMED BY THE COMPANY UNDER THIS AGREEMENT EXCEED THE
TOTAL CASH FEES RECEIVED BY THE CONSULTANT, EXCEPT IN THE CASE
OF WILLFUL MISCONDUCT, GROSS NEGLIGENCE OR ACTUAL FRAUD.
9.2 NOTICES. All notices and other communications provided for or
permitted in this Agreement will be made in writing by
hand-delivery, registered first-class mail, or courier
guaranteeing overnight delivery:
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If to the Company to:
AuGrid Corp., Inc
0000 X. 00xx Xxxxxx - 0xx Xxxxx
Xxxxxxxxx, Xxxx 00000
Attn: Xxxxxxxx Xxxxxxx, CEO/ President
If to the Consultant to:
Xxxx Xxxxx
0 Xxxxx Xxxx # 000
Xxxxxxx Xxxxx, XX 00000
Attn: Xxxx Xxxxx, President
or at such other address as any party specifies by notice given to
the other parties in accordance with this Section 9.2.
All notices and communications will be deemed to have been duly given; at the
time delivered by hand, if personally delivered; three business days after being
deposited in the mail, postage prepaid, if mailed; when receipt acknowledged,
and on the next business day if timely delivered to a courier guaranteeing
overnight delivery; provided, however, that the inability to deliver any notice
or other communication because of the changed address of which no notice was
given, or rejection or refusal to accept any notice or other communication as of
the date if such inability to deliver or rejection or refusal to accept
delivery.
9.3 WAIVERS. The failure of a party to this Agreement to insist upon
strict adherence to any of the terms of this Agreement on any
occasion will not be considered a waiver, or deprive that party
of the right thereafter to insist upon strict adherence to that
term or other term of this Agreement. Any waiver must be in
writing.
9.4 FORCE MAJEURE. The Consultant will not be responsible for any
failure or delay in performance of its obligations under this
Agreement because of circumstances beyond its reasonable control
including acts of God, fires, floods, wars, civil disturbances,
sabotage, accidents, labor disputes (whether or not the
employees' demands are reasonable and within the party's power
to satisfy), governmental actions or transportation delays.
9.5 GOVERNING LAW. This Agreement, the rights of the parties in,
under and to this Agreement and any dispute or action relating
to this Agreement (whether
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in contract, tort or otherwise) will be governed by, construed
and enforced in accordance with the laws of New York applicable
to the agreements made and performed entirely in that State. Any
legal actions, suits or proceeding arising out of this Agreement
(whether arising in contract, tort or otherwise) other than any
claim, action, dispute or controversy subject to arbitration
under Section 7 hereof, will be brought exclusively in a federal
or state court located in the State of New York having
jurisdiction of those courts with respect to any legal actions,
suits or proceeding (whether arising in contract, tort or
otherwise) arising out of this Agreement. In the event of any
legal action, suit or proceeding, the parties waive their right
to a jury trail.
9.6 ENTIRE AGREEMENT; AMENDMENTS. This Agreement represents the
entire understanding of the parties and superceded and cancels
any and all prior negotiations, undertakings and agreements
between the parties, whether written or oral, with respect to
the subject matter of the Agreement. This Agreement may be
amended, modified, waived or terminated only by a written
instrument signed by both parties to this Agreement.
9.7 BINDING EFFECT. This Agreement will insure to be the benefit of
and will be binding upon the parties their respective
successors, permitted transferees and assigns.
9.8 ASSIGNMENT AND BENEFITS OF AGREEMENT. This Agreement may not be
assigned by any party to this Agreement without the written
consent of the other party. Nothing in this Agreement, express
or implied, is intended to confer upon any person other that the
parties hereto, and their said successors and assigns, any
rights under or by reason of this Agreement.
9.9 INDEPENDENT CONTRACTOR. Each of the Company and the Consultant
certifies that neither party has any authority to act for or
bind the other party except as expressly provided for in this
Agreement, that the Consultant may work for others, and that any
persons provided by the Consultant under this Agreement will be
solely the employees or agents of the Consultant under its sole
and exclusive direction and control.
9.10 SEVERABILITY. To the extent that any provision of this Agreement
or the application thereof is determined by a court of competent
jurisdiction to be invalid or unenforceable, the remainder of
this Agreement, or the application of such a provision under
other circumstances, will be unaffected and will continue in
full force and effect unless the invalid or unenforceable
provision is of such essential importance for this Agreement
that it is to be reasonably assumed that the parties would not
have concluded this Agreement without the invalid or
unenforceable provision.
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9.11 CONSENTS. Any consent or approval to be given under this
Agreement may be delegated by the party to give such consent or
approval to any agent or representative as such party may, from
time to time, authorize in writing.
9.12 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, and each of the parties on separate counterparts,
each of which, when so executed, will be deemed an original, not
all of which will constitute but one and the same original.
9.13 THIRD PARTIES. Nothing in this Agreement, expressed or implied,
is intended or will be construed to confer upon or give any
person other than parties to this Agreement, their permitted
successors or assigns and (to the extent indicated herein) any
rights or reminded under or by reason of this Agreement.
9.14 FURTHER ASSURANCES. Each party will take or perform such actions
as reasonable requested by the other party, including the
execution of any additional documents, in order to carry out the
intent of, and to facilitate and effectuate the actions
contemplated by this Agreement.
IN WITNESS WHEREOF, THE PARTIES HAVE DULY EXECUTED THIS AGREEMENT AS OF THE DATE
FIRST ABOVE WRITTEN.
AUGRID CORPORATION
By: /s/ X.X. Xxxxxxx
-------------------------------------
Name: X.X. Xxxxxxx
Title: Chief Executive Officer/President
By: /s/ Xxxx Xxxxx
-------------------------------------
Name: Xxxx Xxxxx
Consultant
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