CONSULTING SERVICES AGREEMENT
This Consulting Services Agreement (the "Agreement") is entered into this 15th
day of May, 2005 by and between Xxxxxx X. Xxxxx, 0000 XxXxxxxx Xxxxxx,
Xxxxxxx, Xxxxx, 00000 hereinafter referred to as "Consultant"), and M Power
Futures, a Delaware corporation, and its successors, affiliates and assigns,
including without limitation M Power Entertainment and GK Intelligent Designs
(hereinafter referred to as "Client"), (collectively referred to as
the"Parties") with reference to the following:
Preliminary Statement
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A. The Client desires to be assured of the association and services of the
Consultant in order to avail itself of the Consultant's experience, skills,
abilities, knowledge, and background to facilitate its operations, and to
advise the Client in business and/or financial and merger/acquisition matters
and is therefore willing to engage Consultant upon the terms and conditions
set forth herein. Consultant desires to be assured, and Client desires to
assure Consultant, that, if Consultant associates with Client and allocates
its resources necessary to provide Client with its business advisory and
consulting services, Consultant will be paid the consideration described
herein and said consideration will be nonrefundable, regardless of the
circumstances.
Consultant agrees to be engaged and retained by Client and upon the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing, of the mutual promises
hereinafter set forth and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Parties hereto
agree as follows:
1. Engagement, Client hereby engages Consultant on a non-exclusive basis,
and Consultant hereby accepts the engagement to a become business and
financial Consultant to Client and to render advice, consultation,
information, and services to the Directors and/or Officers of Client regarding
general financial and business matters including, but not limited to the
following:
1.1 Assistance, Advice and Counsel. Consultant will provide
assistance, advice and counsel regarding Client's operations, strategic
business plans, strategy and negotiations with potential business partners,
corporate planning and/or other general business consulting needs as expressed
by Client.
1.2 Transaction Due Diligence. Consultant will from time to time
participate and assist Client in the due diligence process, where possible, on
certain proposed financial transactions affecting Client of which Consultant
is notified in writing in advance, including conducting investigation of and
providing advice on the financial, valuation and stock price implications of
the proposed transaction(s).
1.3 Ancillary Document Services. If necessary, Consultant will assist
and cooperate with Client in the development, editing and production of such
documents as are reasonably necessary to assist in any transaction covered by
this Agreement. However, this Agreement will not include the preparation or
procuring of legal documents or those documents normally prepared by an
attorney.
1.4 Mergers, Acquisitions, Divestitures, Strategic Alliances.
Consultant will provide assistance to Client, as mutually agreed, in
identifying candidates for strategic alliance, merger/acquisition or
divestiture, assisting in any due diligence process, recommending transaction
terms and providing advice and assistance during negotiations, as needed. It
is expressly understood that Consultant shall have no power to bind Client to
any contract or transaction obligation. Additional compensation to Consultant
for the successful closing of any such merger or acquisition shall be made
pursuant to Section 1.4.a.ii. below.
a. Transaction Services. Consultant agrees to introduce and/or
assist Client in acquiring, merging, and/or divesting on a non-exclusive
basis, from time to time, as Consultant deems appropriate in her sole
discretion. Consultant will introduce and/or assist the Client with one or
more parties who might be interested (whether by way of merger,
consolidation, asset purchase, technology license, or substantially similar
transaction) in either, (a) acquiring some or all of Client's assets or, (b)
selling some or all of their own assets to Client and/or, (c) entering into
some form of strategic alliance with Client. In consideration of Consultant's
services, and in addition to the Retainer Fee/Stock described in Par. 2 below,
Client agrees to pay Consultant the Transaction Fee set forth in paragraph
1.4,a.ii.
i. Performance by Consultant. Consultant shall be deemed
to have earned her entire fee under Section 1 .4.a.ii upon, (i) Consultant's
introduction of any bona fide potential strategic alliance candidate,
acquirer/seller of assets or merger candidate or, (ii) upon materially
assisting Client with strategic alliance, merger, acquisition and/or
divestiture efforts with an introduced or non-introduced candidate and, (iii)
the consummation of the strategic alliance, merger, acquisition, and/or
divestiture by Client within 24 months from the date of such introduction or
effort. Consultant shall be entitled to receive a fee (as described in
paragraph 1 .4.a.ii., below) for each such strategic alliance, merger,
acquisition and/or divestiture by the Client. Each such obligation of Client
to pay such fee shall be deemed a separate agreement hereunder severable from
each of the other obligations to pay fees arising hereunder and each
obligation shall be separately enforceable as if separate written agreements
existed for each introduction and/or effort made by Consultant.
ii. Transaction Fee. For any strategic alliance,
merger/acquisition or divestiture entered into by Client as a result of the
activities of Consultant as described in Par. 1.4.a.i ,, Client shall pay
Consultant, two and a half percent (2.5%) of the total value of the
transaction.
Note: Such percentage(s) shall be paid to Consultant in the
same ratio of cash and / or stock as the transaction. "Total value" shall
include, but is not limited to cash, cash equivalents, stock, and the value of
any consideration other than cash paid or received by Client. All shares
earned under this section that have not been registered with the Securities
and Exchange Commission shall be registered by Client on Form S-8 or similar
registration within 5 days of the completion of the transaction. All costs in
connection with the registration shall be borne by Client.
b. Terms of Payment of Transaction Fee. In addition to the
payment of the Retainer Fee/Monthly Stock transfer payment as provided in
Section 2 below, each time a fee is due as specified in any other provision of
this Agreement, the fee amount, as specified therein, shall be payable by
Client to Consultant upon the closing of the transaction. The fee due
Consultant shall be in addition to any fee or funds which may be payable to
any other person or entity as a result of the transaction.
Consultant makes no guarantee that she will be able to successfully locate a
strategic alliance, merger/acquisition or divestiture candidate and in turn
assist Client in consummating any such transaction for Client, or to
successfully complete any such transaction(s) within Client's desired time
frame. Any comments made regarding potential time frames or anything that
pertains to the outcome of Client's needs are expressions of Consultant's
opinion only, and for purposes of this Agreement are specifically disavowed.
1.5 Standard of Performance. Consultant shall devote such time and
efforts to the affairs of the Client as is reasonably necessary to render the
services contemplated by this Agreement. The time frame for completion of any
work or task of Consultant provided for herein which requires Client to
provide certain information to assist Consultant in completion of the work
shall be extended (without effect upon any obligation of Client) until such
time as Client has fully provided all information and cooperation necessary
for Consultant to complete the work. This extension of time includes
calculation of the time to consummation of any transaction described in Par.
1.4.a.i above. The services of Consultant shall not include the rendering of
any legal opinions or the performance of any work that is in the ordinary
purview of a certified public accountant, or other licensed professional.
Consultant cannot guarantee results on behalf of Client, but shall use
commercially reasonable efforts in providing the services listed above. If an
interest is communicated by any potential candidate to Consultant regarding
satisfying all or part of Clients business and corporate strategic planning
needs.
2. Compensation to Consultant
a. Monthly Retainer Fee. . Client shall pay Consultant a
monthly retainer fee of Ten thousand dollars ($10,000.00), the first of which
payments (in the prorated amount of $5,000.00) shall be due and payable upon
execution of this Agreement. Subsequent payments shall be due and payable on
the first of each month following execution of this Agreement for the entire
term of this Agreement.
b. Form of Retainer Fee Payment. For each monthly retainer
fee payment, Consultant may elect to receive payment in the form of common
stock of M Power Futures or its successor(s), including without limitation M
Power Entertainment, rather than in a cash payment. In the event that
Consultant elects to receive common stock, the issuance of said shares shall
be registered with the U.S. Securities and Exchange Commission on its Form S-8
or similar registration within five days of delivery of such stock to
Consultant. The number of shares to be received by Consultant shall be
calculated by dividing the amount of the monthly retainer fee payment
($10,000.00) by the average trading price for the five days prior to the date
payment is due.
c. Additional Consideration in Form of Monthly Stock Transfer.
Consultant understands and agrees that, prior to June 1, 2005, shareholders of
M Power Futures, including Consultant (pursuant to Par. 2(e) below), will sell
all shares of M Power Futures to M Power Entertainment. In addition to the
Retainer Fee, Consultant shall receive, for each month in which this Agreement
is in effect, ten thousand post-split shares per month of common stock in M
Power Entertainment, commencing on the effective date of this Agreement and
continuing throughout the term of this Agreement. Such shares shall be
transferred to Consultant on the first day of each month in which this
Agreement remains in effect. Such shares shall be registered with the U.S.
Securities and Exchange Commission on its Form S-8 or similar registration
within five days of delivery of such stock to Consultant.
d. Reimbursement for Expenses, Consultant shall submit to
Client a monthly invoice for all expenses incurred on Client's behalf, as
specified in Par. 2.1 below, Client agrees to reimburse Consultant for such
expenses within ten (10) days from receipt of the statement.
e. Initial Consideration. As consideration for Consultant
entering into this Agreement, Client agrees to assign to Consultant four
million (4,000,000) shares of common stock of M Power Futures, within 30 days
of execution of this Agreement. Such shares shall be registered with the U.S.
Securities and Exchange Commission on its Form S-8 or similar registration
within 5 days of delivery of such stock to Consultant.
Consultant understands and agrees that, prior to June 1, 2005,
all shareholders of M Power Futures, including Consultant, will sell one
hundred percent (100%) of their stock in M Power Futures to M Power
Entertainment. Consultant further understands and agrees that, as part of that
transaction, Consultant will sell her four million (4,000,000) shares of
common stock in M Power Futures to M Power Entertainment in return for one
million (1,000,000) post-split shares of common stock in M Power Entertainment
Such shares shall be registered with the U.S. Securities and Exchange
Commission on its Form S-8 or similar registration within five days of
delivery of such stock to Consultant.
Note: Consultant shall have no obligation to perform any duties provided
for herein if payment [cash and/or stock] is not received by Consultant within
the time periods as stipulated above. In addition, Consultant's obligations
under this Agreement shall be become null and void if any payment owing
hereunder is not delivered within the time periods as stipulated above.
Furthermore, the receipt of any fees due to Consultant upon execution of this
Agreement are not contingent upon any prior performance of any duties
whatsoever described within this Agreement
2.1 Expenses. Client shall reimburse Consultant for reasonable
expenses incurred in performing its duties pursuant to this Agreement
(including, but not limited to printing, postage, express mail, photo
reproduction, travel, lodging, and long distance telephone cell phone,
entertainment, software and facsimile charges), pursuant to the terms of Par.
2(d) above.
2.2 Additional Fees. Client and Consultant shall mutually agree upon
any additional fees that Client may pay in the future for services rendered by
Consultant under this Agreement. Such additional agreement(s) may, although
there is no requirement to do so, be attached hereto and made a part hereof as
Exhibits beginning with "A."
3. INDEMNIFICATION.
3.1. The Client agrees to indemnify and hold harmless Consultant
against any and all liability, loss and costs, expenses or damages, including
but not limited to, any and all expenses whatsoever reasonably incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever or howsoever caused by Consultant in the
performance of her duties under this Agreement, or by reason of any injury
(whether to body, property, personal or business character or reputation)
sustained by any person or to any person or property, arising out of any act,
failure to act, neglect, any untrue or alleged untrue statement of a material
fact or failure to state a material fact which thereby makes a statement false
or misleading, or any breach of any material representation, warranty or
covenant by Client or any of its agents, employees, or other representatives.
All remedies provided by law, or in equity shall be cumulative and not in the
alternative.
4. CONFIDENTIALITY
4.1 Consultant and Client each agree to keep confidential and provide
reasonable security measures to keep confidential information where release
may be detrimental to their respective business interests. Consultant and
Client shall each require their employees, agents, affiliates, other
licensees, and others who will have access to the information through
Consultant and Client respectively, to first enter appropriate non-disclosure
Agreements requiring the confidentiality contemplated by this Agreement in
perpetuity.
4.2 Consultant will not, either during its engagement by the Client
pursuant to this Agreement or at any time thereafter, disclose, use or make
known for its or another's benefit any confidential information, knowledge, or
data of the Client or any of its affiliates in any way acquired or used by
Consultant during its engagement by the Client, Confidential information,
knowledge or data of the Client and its affiliates shall not include any
information that is, or becomes generally available to the public other than
as a result of a disclosure by Consultant or its representatives.
5. INDEPENDENT CONTRACTOR
5.1 In her performance hereunder, Consultant and her agents shall be
independent contractors. Consultant shall complete the services required
hereunder according to her own means and methods of work, shall be in the
exclusive charge and control of Consultant, and shall not be subject to the
control or supervision of Client, except as to the results of the work. Client
acknowledges that nothing in this Agreement shall be construed to require
Consultant to provide services to Client at any specific time, or in any
specific place or manner. Payments to Consultant hereunder shall not be
subject to withholding taxes or other employment taxes as required with
respect to compensation paid to an employee. It is further understood and
agreed that Consultant's compensation under this Agreement is not for any
capital raising or stock promotion or support.
6. MISCELLANEOUS PROVISIONS
6.1 Amendment and Modification. This Agreement may be amended,
modified and supplemented only by written agreement of Consultant and Client,
6.2 Assignment. This Agreement and all of the provisions hereof shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns. The obligations of either party
hereunder cannot be assigned without the express written consent of the other
party.
6.3 Binding Effect. All obligations of Client under this Agreement
shall be binding upon, and fully enforceable against, Client, its agents,
officers, directors, successors, assigns, affiliates and purchasers.
6.3 Governing Law; Venue. This Agreement and the legal relations
among the parties hereto shall be governed by and construed in accordance with
the laws of the State of Texas, without regard to its conflict of law
doctrine. Client and Consultant agree that if any action is instituted to
enforce or interpret any provision of this Agreement, the jurisdiction and
venue shall be Houston, Texas.
6.4 Attorneys' Fees and Costs. If any action is necessary to enforce
and collect upon the terms of this Agreement, the prevailing party shall be
entitled to reasonable attorneys' fees and costs, in addition to any other
relief to which that party may be entitled. This provision shall be construed
as applicable to the entire Agreement.
6.5 Survivability. If any part of this Agreement is found, or deemed
by a court of competent jurisdiction, to be invalid or unenforceable, that
part shall be severable from the remainder of the Agreement.
6.6 Facsimile Signatures. The Parties hereto agree that this
Agreement may be executed by facsimile signatures and such signature shall be
deemed originals. The Parties further agree that within ten (10) days
following the execution of this Agreement, they shall exchange original
signature pages.
7. ARBITRATION
7.1 All disputes, controversies, or differences between client,
consultant or any of their officers, directors, legal representatives,
attorneys, accountants, agents or employees, or any customer or other person
or entity, arising out of, in connection with or as a result of this
Agreement, shall be resolved through arbitration rather than through
litigation. With respect to the arbitration of any dispute, the undersigned
hereby acknowledge and agree that:
A. Arbitration is final and binding on the parties;
B. The parties are waiving their right to seek remedy in court,
including their right to jury trial;
C. Pre-arbitration discovery is generally more limited and
different from court proceeding;
D. The arbitrator's award is not required to include factual
findings or legal reasoning and any party's right of appeal or to seek
modification of ruling by the arbitrators is strictly limited;
E. This arbitration provision is specifically intended to
include any and all statutory claims which might be asserted by any party;
F. Each party hereby agrees to submit the dispute for
resolution to the American Arbitration Association, in New York, New York
within five (5) days after receiving a written request to do so from the other
party;
G. If either party fails to submit the dispute to arbitration
on request, then the requesting party may commence an arbitration proceeding,
but is under no obligation to do so;
H. The arbitrator will be selected by agreement of the parties
from a panel of potential arbitrators provided by the American Arbitration
Association. In the event the parties are unable to reach agreement on
selection of the arbitrator, each party shall exercise strikes from the panel
provided until one candidate remains, which candidate will arbitrate the
dispute;
I. Any hearing scheduled after an arbitration is initiated
shall take place in New York, New York;
J. If either party shall institute any court proceeding in an
effort to resist arbitration and be unsuccessful in resisting arbitration or
shall unsuccessfully contest the jurisdiction of any arbitration forum located
in New York, New York, over any matter which is the subject of this agreement,
the prevailing party shall be entitled to recover from the losing party its
legal fees and any out-of-pocket expenses incurred in connection with the
defense of such legal proceeding or its efforts to enforce its rights to
arbitration as provided for herein;
K. The parties shall accept the decision of any award as being
final and conclusive and agree to abide thereby;
L. Any decision may be filed with any court as a basis for
judgment and execution for collection.
8. TERM/TERMINATION.
8.1 The Term of this Agreement (the "Term") shall commence on the May
15, 2005 and shall continue until December 31, 2005. The parties to this
Agreement agree that prior to 90 days before the end of the Term they will
notify each other of their intent to extend this Agreement. If an extension
is not agreed upon, the Agreement will terminate at the end of the Term.
a. Early Termination With or Without Cause. Either party may
terminate this Agreement with or without cause with 60 days advance written
notice.
b. Early Termination for Material Breach or Bankruptcy.
Notwithstanding the provisions of Section 7 above, either party may terminate
this Agreement for the following:
i. on or after the thirtieth (30th) day after such party
gives the other party written notice of a material breach by such other party
of any obligation hereunder unless such breach is cured within thirty (30)
days following the breaching party's receipt of such written notice. Neither
party will be liable to the other party for damages of any kind resulting from
any rightful termination of this Agreement as provided by this Section 7
ii. either party may terminate this Agreement upon
written notice to the other if such other party: (i) shall make an assignment
for the benefit of creditors, (ii) shall be adjudicated bankrupt or
insolvent, (iii) shall seek the appointment of, or be the subject of an order
appointing, a trustee, liquidator or receiver as to all or part of its assets,
(iv) shall commence, approve or consent to, any case or proceeding under any
bankruptcy, reorganization or similar law and , in the case of an involuntary
case or proceeding, such case or proceeding is not dismissed within forty-five
(45) days following the commencement thereof, or (v) shall be the subject of
an order for relief in an involuntary case under federal bankruptcy law.
9. CLIENT REPRESENTATIONS, WARRANTS AND COVENANTS.
9.1 Client represents, warrants and covenants to the Consultant as
follows:
Client has the full authority, right, power and legal capacity to
enter into this Agreement and to consummate the transactions that are provided
for herein. The execution of this Agreement by the Client and its delivery to
the Consultant, and the consummation by it of the transactions which are
contemplated herein have been duly approved and authorized by all necessary
action by the Client's Board of Directors and no further authorization shall
be necessary on the part of the Client for the performance and consummation by
the Client of the transactions which are contemplated by this Agreement.
The business and operations of the Client have been and are being
conducted in all material respects in accordance with all applicable laws,
rules and regulations of all authorities that affect the Client or its
properties, assets, businesses or prospects. The performance of this Agreement
shall not result in any breach of, or constitute a default under, or result in
the imposition of any lien or encumbrance upon any property of the Client or
cause acceleration under any arrangement, agreement or other instrument to
which the Client is a party or by which any of its assets are bound. The
Client has performed in all respects all of its obligations which are, as of
the date of this Agreement, required to be performed by it pursuant to the
terms of any such agreement, contract or commitment.
Consultant makes no representations or warranties other than those
contained within this Agreement.
10. NOTICES.
10.1 Any notice or other communication required or permitted
hereunder must be in writing and sent by either (i) certified mail, postage
prepaid, return receipt requested and First Class mail; or (ii) overnight
delivery with confirmation of delivery; or (iii) facsimile transmission with
an original mailed by first class mail, postage prepaid, addressed as follows:
If to the Client: Xxxx X. Xxxxxxx
M Power Entertainment, Inc
0000 Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Facsimile No: 000-000-0000
If to Consultant: Xxxxxx X. Xxxxx
0000 XxXxxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
Facsimile No: (000) 000-0000
or in each case to such other address and facsimile number as shall have last
been furnished by like notice. If mailing is impossible due to an absence of
postal service and other methods of sending notice are not otherwise
available, notice shall be hand-delivered to the aforesaid addresses. Each
notice or communication shall be deemed to have been given as of the date so
mailed or delivered, as the case may be; provided, however, that any notice
sent by facsimile shall be deemed to have been given as of the date sent by
facsimile if a copy of such notice is also mailed by first class mail on the
date sent by facsimile; if the date of mailing is not the same as the date of
sending by facsimile, then the date of mailing by first class mail shall be
deemed to be the date upon which notice given.
11. COUNTERPARTS
11.1 This Agreement may be executed simultaneously in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
12. PRELIMINARY STATEMENT
12.1 The Preliminary Statement is incorporated herein by this
reference and made a material part of this Agreement
**SIGNATURE PAGE FOLLOWS"
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly
executed, all as of the day and year first above written.
CLIENT:
M Power Futures, Inc.
/s/ Xxxx Xxxx
________________________________________________________
Xxxx Xxxx
Title: President
Date: May 15, 2005
CONSULTANT:
/s/ Xxxxxx X. Xxxxx
________________________________________________________
Xxxxxx X. Xxxxx
Date: May 15, 2005
