Exhibit 10.26
AGREEMENT FOR SERVICES
DATE: June 26, 2001
I. PARTIES
Smart Chip Technologies, LLC, a Nevada limited liability company, hereinafter
"Company,"
and
HiTech Consulting Group, hereinafter "HiTech," hereby enter into this Agreement
for HiTech Services, hereinafter "Agreement," effective the above date.
II. ENGAGEMENT OF HITECH
Company hereby engages HiTech, and HiTech accepts engagement, to provide to
Company the following services:
Business Development primarily focused on maximizing the value of
Company's intellectual property, as more particularly set forth in the
confidential scope of work memorandum of even date signed by both parties. Such
scope of work memorandum may be reviewed and revised from time-to-time during
the term of this agreement at the mutual agreement of the parties.
III. TERM OF ENGAGEMENT
This Agreement shall be an exclusive agreement for a term of one (1) year
commencing June 26, 2001. Subsequent to this initial one (1) year term, this
Agreement will automatically renew for another year from the anniversary date,
unless within 90 days prior to the end of the initial one year term either party
notifies the other of termination, in which case this Agreement shall terminate
at the end of the initial one (1) year term.
IV. WORKPLACE AND HOURS
HiTech shall render services primarily at HiTech's offices or any other place of
HiTech's choosing. However, upon request, HiTech shall provide the services at
such other place or places as reasonably requested by Company as appropriate for
the performance of particular services.
HiTech's schedule and hours worked under this Agreement shall generally be
subject to HiTech's discretion. Company relies upon HiTech's discretion to
determine a sufficient time as is reasonably necessary to fulfill this
Agreement.
V. COMPENSATION
Company shall pay HiTech per the following schedule:
(a) Monthly Fee: Monthly cash payment of $6,000 beginning July 1, 2001,
payable at the first of each month, in advance.
(b) Performance Compensation:
(i) 10 % of revenue generated as a direct result of HiTech's
efforts for a period of 24 months from the time that revenue
begins to be realized. The Company will pay Performance
Compensation earned on the 15th of each month.
(ii) At any time after the tenth day of any month, HiTech may elect
to take restricted common stock of Schimatic Cash Transactions
▇▇▇▇▇▇▇.▇▇▇, Inc. in lieu of Performance Compensation at a
price equal to 50% of the closing price on the last trading
day preceding the day of the election.
(iii) 5% of any judgments or settlements whether payable in cash or
in kind (i.e., royalties, equity interests, etc.,), arising
from litigation resulting from the efforts of HiTech, payable
if, as and when such judgments are actually collected.
Termination of this agreement by either party, whether or not upon the default
of the other, will not relieve Company from any liability for payment in full of
all Performance Compensation due HiTech for revenue generated as a direct result
of HiTech's efforts. If any transactions or lawsuits are pending as a result of
the direct efforts of HiTech at the time this Agreement terminates, Company will
remain obligated to pay compensation in accordance with the foregoing.
Company shall bear all of HiTech's pre-approved expenses incurred in the
performance of this Agreement. Such expenses will be reimbursed monthly.
Expenses for phone, fax, and mail will be $150 per month. Local business travel
will be reimbursed at $150 per month. Phone, fax, mail, and local business
travel expenses are reimbursable on a monthly basis in the amounts set forth
herein and are not subject to pre-approval.
VI. NONCOMPETITION
During the term of this Agreement and for a period of 24 months after
termination of this agreement at the expiration of its term or by either party,
whether or not upon the default of the other, after expiration or termination of
this Agreement, whether upon default by either party, HiTech shall not, directly
or indirectly, own, manage, operate, control, be employed by, or consult with
any business the same as or reasonably similar to the "Smart Loyalty" business
conducted by Company. In the event any of the provisions of this Paragraph are
determined to be invalid by reason of their scope or duration, this Paragraph
shall be deemed modified to the extent required to cure the invalidity.
VII. CONFIDENTIALITY
"Confidential Information" for the purposes of this Agreement shall include
Company's proprietary and confidential information including, without
limitations, business plans, customer lists, marketing plans, financial
information, designs, drawing, specifications, models, software, source codes
and object codes. At termination of this Agreement, HiTech shall turn over to
Company all originals and copies of tangible material containing or reflecting
Company's Confidential Information. During the term of this Agreement, and
thereafter for 24 months HiTech shall restrict disclosure of such Confidential
Information to its employees, officers, directors and advisors only with a need
to know . HiTech shall not, without the prior written consent of Company,
disclose to any third party any Confidential Information The parties agree that
remedies available at law are inadequate to compensate for breach of this
paragraph, and that either party may apply to a Court of competent jurisdiction
for equitable relief upon proper showing. Upon termination of this Agreement for
any reason, HiTech will surrender to Company all copies of all Confidential
Information or certify that all such information not so surrendered has been
destroyed.
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VIII. HITECH STATUS
It is expressly understood and agreed that HiTech is and throughout the term of
this Agreement shall not be an employee, partner, or agent of Company. HiTech
shall not be entitled to nor receive any benefit normally provided to Company's
employees. HiTech agrees that Company shall have ownership, title, and Company
reserves all rights, including copyrights, of all works created by HiTech under
this Agreement, including but not limited to source code. HiTech hereby
prospectively assigns all such works to Company, for the consideration provided
in Paragraph V. Company shall not be responsible for withholding income or other
taxes from the payments made to HiTech. HiTech shall be solely responsible for
filing all returns and paying any income, social security, or other tax levied
upon or determined with respect to the payments made to HiTech pursuant to this
Agreement. HiTech is solely responsible for the means, manner, and method of
HiTech's work, subject only to the general objectives and requirements, and
specific direction, of SCTN's technical specifications. Unless otherwise agreed
by Company in advance, HiTech shall be solely responsible for procuring, paying
for, and maintaining any and all equipment, software, paper, tools or other
supplies necessary or appropriate for the performance of HiTech's services
hereunder.
IX. HITECH'S LIMITED AUTHORITY
HiTech shall not have the authority to make any decisions on behalf of Company
respecting any matter as to which HiTech renders services hereunder or to enter
into agreements or contracts on behalf of Company or otherwise bind Company.
HiTech shall not have the authority to engage legal counsel on behalf of
Company, to assert causes of action or claims for relief on behalf of Company,
or to initiate litigation on behalf of Company or in its name, place or stead.
X. COMPANY'S RESPONSIBILITIES
REGARDING REPRESENTATIONS
The Company represents and warrants to HiTech that, to the best of its
knowledge, any and all information provided to HiTech in connection with any
transaction initiated pursuant to this Agreement, including all information
given to HiTech to distribute to third parties, will not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein not misleading. Company shall be directly liable for any
untrue representations made by HiTech to any third party in connection with a
transaction under this Agreement if such representation is based on information
provided to HiTech by Company.
XI. INDEMNIFICATION
In consideration of the compensation paid by Company and the services provided
by HiTech under this Agreement, the Company and HiTech shall:
(a) Indemnify and hold harmless the other and each of either's directors,
officers, employees, consultants or agents (Indemnified Persons) form
and against any losses, claims, damages or liabilities to which such
Indemnified Persons may become subject arising out of or in connection
with the rendering of services by HiTech hereunder, except to the
extent that such losses, claims, damages or liabilities are determined
in judicial, proceedings to have primarily resulted from the gross
negligence or willful misconduct of such Indemnified Person; and
(b) Reimburse such Indemnified Person for reasonable legal fees and other
expenses as they are incurred that arise in connection with
investigating, preparing to defend or defending any lawsuit, claim, or
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proceeding and any appeals therefrom arising in any manner out of or in
connection with the rendering of services by HiTech, provided however,
that in the event a final judicial determination is made to the effect
specified in subsection a above, such Indemnified Person will promptly
remit to the Company any amounts reimbursed under this section.
Company and HiTech agree that (i) the indemnification and reimbursement set
forth above shall apply whether or not such Indemnified Person is a named party
to any lawsuit, claim or other proceeding; and (ii) promptly after receipt by
HiTech of notice of its involvement in any action, proceeding or investigation,
shall notify Company in writing of such involvement. This indemnification shall
survive any termination of this Agreement.
XII. AUDIT RIGHTS
HiTech and/or its designated representatives shall have full access during
normal business hours to inspect all of the books, accounts, records, contracts
and documents of Company, relating to any transaction arising from the terms of
this Agreement.
XIII. SERVICES BY HITECH
Company is engaging the services of HiTech on the understanding that E. ▇▇ ▇▇▇▇
("▇▇▇▇"), its chief executive officer, will be responsible for providing the
services on behalf of HiTech hereunder. This Agreement shall terminate, (a) in
the event of Rose's death, on the last day of the month in which such death
occurs, or (b) in the event of Rose's disability, on the last day of the third
month following the commencement of such disability. "Disability" shall mean any
time that Rose is unable to continue to perform the duties required to be
performed by HiTech under this Agreement by reason of a medically determined
physical impairment for a period of three consecutive months or an aggregate of
six months during any consecutive twelve months. In determining whether Rose is
disabled, Company may rely upon the opinion of any doctor or practitioner of any
recognized field of medical or psychiatric practice selected jointly by Company
and HiTech and such other evidence as Company deems appropriate.
XIV. DEFAULT AND TERMINATION
Company may terminate this Agreement at any time after 30 days' written notice
to HiTech for any of the following reasons:
(a) HiTech or Rose substantially fails to perform or habitually neglects
the duties defined in II by HiTech hereunder;
(b) any material dishonest act by HiTech or Rose relating to Company's
business;
(c) any act by HiTech or Rose that would be materially detrimental to
Company's business reputation; or
(d) HiTech or Rose rendering of any services to a firm or entity that does
business in a field competitive with the business of Company, except as
may be expressly authorized in writing by Company.
XV. ATTORNEY FEES
If any action, suit, arbitration or other proceeding is instituted arising out
of this Agreement, the prevailing party shall recover all of such party's costs,
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including without limitation, court costs and attorney fees incurred therein,
including any and all appeals or petitions therefrom. As used herein "attorney
fees" shall mean the full and actual costs of any legal services actually
rendered in connection with the matters involved calculated on the basis of the
usual fee charged by the attorneys performing such services.
XVI. CONTROLLING LAW
This Agreement shall be governed by and construed in accordance with the laws of
the State of California.
XVII. ENTIRE AGREEMENT
This Agreement constitutes the final understanding and agreement between the
parties. This Agreement cannot be amended or changed except by a writing signed
by both of the parties.
XVIII. NOTICES
Any notice required to be given or otherwise given pursuant to this Agreement
shall be in writing and shall be hand delivered, mailed by certified mail,
return receipt requested:
If to HiTech:
HiTech Consulting Group
E. ▇▇ ▇▇▇▇, CEO
▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
If to Company:
Smart Chip Technologies
▇▇▇ ▇▇▇▇▇▇▇▇, President & CEO
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
IN WITNESS WHEREOF, this Agreement has been executed by the parties as of the
date first above written.
HiTech Consulting Group
By /s/ E. ▇▇ ▇▇▇▇
--------------------------------------------
E. ▇▇ ▇▇▇▇, CEO
Smart Chip Technologies, LLC
By /s/ ▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------------------
▇▇▇ ▇▇▇▇▇▇▇▇, President & CEO
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