Magnitude Information Systems, Inc. Branchburg, New Jersey 08876
Exhibit
10.34
Magnitude
Information Systems, Inc.
0000
Xxxxx 00, Xxxxx 000
Xxxxxxxxxx,
Xxx Xxxxxx 00000
June
27, 2008
Tell
Capital, AG
Xxxxxxxxxxxx
00
XX-0000
Xx. Xxxxxx
Xxxxxxxxxxx
Attention:
Xx. Xxxxxx Xxxxxxxx
Dear
Xx. Xxxxxxxx:
This
letter shall serve as an Engagement Agreement (the “Agreement”) pursuant to
which Magnitude Information Systems, Inc. (the '"Company", “we” or “us”) engages
Tell Capital AG (''Consultant") to render specified professional
shareholder/investor relations and senior business development services.
1.
Engagement:
The Company hereby engages Consultant, and Consultant agrees to assist the
Company to: (A) perform as the Company’s Shareholder/Investor Relations Liaison
between the Company and its European shareholders; (B) promote the Company
and
its website to the public markets; (C) identify sources of financing; (D)
identify potential strategic partners, acquisition opportunities and joint
venture partners for the Company’s social networking website business. The
Consultant shall report directly to the Chief Executive Officer. In addition,
the Consultant shall render such services to the Company in other areas as
may
be reasonably required by the Chief Executive Officer of the Company from time
to time as communicated in email or other written form.
2.
Term:
This Agreement shall commence on the date hereof, June 27, 2008 and shall
continue through June 26, 2009 (the "Term"). The Company can terminate this
Agreement, under certain circumstances for Cause, with 30-days written notice.
Termination for "Cause" shall mean termination of this Agreement because
Consultant (a) has engaged in fraudulent or criminal conduct in connection
with
the performance of his duties hereunder which conduct materially and adversely
affects the Company, (b) admits to or has been convicted of a crime punishable
by imprisonment for more than one year, (c) has been disloyal to the Company
by
assisting competitors of the Company or their associates to the disadvantage
of
the Company by a breach of Section 7 or by otherwise actively assisting
competitors to the disadvantage of the Company.
3.
Compensation:
In consideration of the Consultant’s agreement to render the services set forth
herein and his commitment to provide such services, the Company shall pay
Consultant a signing fee of $48,000 upon the execution of this Agreement. In
further consideration for Consultant’s services rendered and to be rendered
during the term of this Agreement, Consultant shall receive the following
compensation:
(a)
For his efforts with respect to his services hereunder described, Consultant
shall, for each month of the Term, receive (1) a stock grant of 1,000,000
restricted common shares, (2) a stock warrant to purchase 1,000,000 restricted
common shares, exercisable at $.05 per share, during a five-year exercise
period, with a “cashless” exercise provision (the “Warrants”), and (3) a payment
of $8,000;
(b)
In order to induce Consultant to render the services required under this
Agreement and to provide Consultant with assurances that during the period
identified below, the exercise price of the Warrants to be earned shall be
equal
to the exercise prices of any Warrants that may be issued by the Company to
any
third party following the date hereof and at any time during the remaining
term
of this Agreement; accordingly, in the event the Company issues a common stock
purchase warrant to any third party during such period, at an exercise price
lower than that contained in the Warrants to be issued under this Agreement,
the
Company shall notify the Consultant to return any Warrants issued under the
terms of this Agreement for cancellation and the Company shall issue new
Warrants in an equal amount to those cancelled, containing an exercise price
equal to the lower exercise price contained in the common stock purchase
warrants issued to any such third party.
4.
Assignment:
Consultant may not assign any of its rights, duties or obligations under this
Agreement without the prior written consent of the Company.
5.
Consultant
Representations:
Consultant agrees and represents: (a) that it is an independent contractor
and
not an employee or agent of the Company and that in acting pursuant to this
engagement it will not legally bind or obligate the Company in any manner
whatsoever; and (b) that the execution and delivery of its performance under
this Agreement shall not violate or breech any agreement, contract or obligation
currently in existence between the Consultant and any third party.
6.
Reimbursement
of Expenses.
The Company will reimburse Consultant for all pre-approved in writing
reasonable, ordinary and necessary business expenses incurred by him in the
fulfillment of his duties hereunder upon presentation of an itemized account
of
such expenditures, in accordance with Company practices and pertinent IRS
regulations.
7.
Confidentiality
and Non-Compete:
Except as contemplated by the terms hereof or as required by applicable law,
Consultant shall keep confidential during the Term and for a period of
twenty-four months thereafter all non-public information provided to Consultant
by the Company, and shall not disclose such information to any third party,
other than such of Consultant’s partners, employees and advisors as Consultant
determines to have a need to know and shall not use any such information for
any
purpose other than the purpose of performing Consultant’s services for the
Company as herein contemplated. In addition, Consultant hereby agrees not to
compete, either directly or indirectly as a shareholder, employee or independent
contractor of another company or entity, with the Company in the field of social
website business or solicit any of the Company's customers or employees to
leave
the Company during the Term and for a period of twenty-four months
thereafter.
8.
Short
Position:
During the term of this engagement and for a period of twenty-four months
thereafter, Consultant or its principals will not maintain a net short position
at any time in the Company's shares. This net position includes freely trading
shares and any preferred shares and warrants on an "as converted"
basis.
9.
Assistants
to Consultant:
Should the Consultant, in Consultant's sole discretion, deem it necessary to
engage assistants, or third parties, to aid Consultant in the performance of
the
Services, the parties agree that such assistants are engaged solely by the
Consultant, and that Consultant alone is responsible for providing compensation
for such assistants.
10.
Agreement:
This Agreement may not be amended or modified except in writing and shall be
deemed to have been made and delivered in the State of New York, and this letter
and the transactions contemplated hereby shall be governed as to validity,
interpretation, construction, effect, and in all other respects by the internal
laws of the State of New York. Any legal action or proceeding arising out of
or
relating to this Agreement and/or the transactions contemplated hereby shall
be
instituted exclusively in either the Supreme Court, New York County, State
of
New York or in the United States District Court for the Southern District of
New
York, and the parties hereby expressly submit to the personal jurisdiction
of
said courts. Consultant acknowledges that a material part of the consideration
upon which the Company is relying to enter into this Agreement is the
Consultant’s promises made in Paragraph 7 and that if Consultant breached such
promise or promises the Company would suffer immediate and irreparable harm
of a
unique nature that could not be determined in liquidated damages. Accordingly,
Consultant agrees that in the event he breaches or threatens to breach any
of
these promises the Company may obtain an injunction against any such breach
or
threat of breach in any one of the above identified New York courts.
11.
Complete
Agreement; Survival:
This Agreement supercedes and replaces any and all prior consulting agreements,
oral or written, between the parties.
The
parties hereby agree that their promises made in Paragraphs 7, 10 and 12 shall
survive any termination of this Agreement.
12.
Indemnification.
The Consultant and the Company hereby agree to defend one another and to
indemnify each other from and against any liability of any nature whatsoever
that may arise out of or as a result of any material misrepresentations or
omissions made in connection with the services rendered under the terms of
this
Agreement made by either the Consultant or the Company, as the case may be
(the
“Indemnifying Party”). By this indemnification, the Indemnifying Party shall
pay, on demand, to the other party (the “Indemnified Party”) any and all costs,
expenses, judgments, fines, including reasonable attorney’s fees, incurred
during any administrative proceeding or legal process instituted against either
the Company or the Consultant whose material allegations include a claim or
claims that the Indemnifying Party made a material misrepresentation or omission
in connection with the conduct of the services rendered under this Agreement.
If
the foregoing correctly sets forth the understanding and agreements between
the
Company and Consultant, Consultant shall indicate so by signing in the space
provided for that purpose below, whereupon this letter shall constitute a
binding agreement as of the date first above written.
This
agreement is subject to approval by the Company's Board of Directors.
Magnitude
Information Systems, Inc.
| By: | |||
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Xxxxxx X. Xxxxxx |
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President
and CEO
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Agreed
to:
Consultant:
tell Capital AG
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| By: | ||
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Xx. Xxxxxx Xxxxxxxx |
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