CONSULTING AGREEMENT
The parties to this Consulting Agreement ("Agreement") are Xxxxx Xxxxx
(the "Consultant") and Uncommon Media Group, Inc., a Florida corporation (the
"Company"). The Company desires to contract with the Consultant for certain
investment relations services, and the Consultant is willing to render such
services as hereinafter more fully set forth.
THEREFORE, in consideration of the mutual agreements and covenants set
forth in this Agreement, the parties agree as follows:
1. Engagement of the Consultant. The Company hereby engages and retains
the Consultant to render to the Company the services described in Section 2
hereof (the "Services") for a period of twelve months commencing on the date
hereof (the "Consulting Period").
2. Description of Consulting Services. The Consultant agrees to act as
an advisor to the Company and, in that regard, to assist the Company (i) in
identifying, analyzing, structuring, negotiating and financing suitable business
opportunities of which the Company may take advantage and (ii) in connection
with the preparation of annual and interim reports and press releases and with
in dealing with financial public relations. Consultant agrees to obtain the
consent of the Company prior to contacting any potential participants in any
transaction or financing.
3. Payment for Services Rendered. In consideration for Consultants
agreements hereunder, the Company agrees to issue to the Consultant a warrant to
purchase up to 100,000 (one hundred thousand) shares, at a price of $0.40 per
share, in the form attached hereto as Exhibit A (the "Warrant").
4. Representations of Consultant.
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4.1 The Consultant recognizes that the receipt of the Warrant
involves a high degree of risk in that (i) the Company is a
development-stage company; (ii) an investment in the Company
is highly speculative; (iii) he/she/it may not be able to
liquidate his/her/its investment; and (iv) transferability of
the securities comprising the Warrant is extremely limited.
4.2 The Consultant acknowledges that he/she/it has prior
investment experience, or that he/she/it has employed the
services of an investment advisor, attorney, or accountant to
read all of the documents furnished or made available by the
Company both to him/her/it and to all other prospective
investors in the Warrant and to evaluate the merits and risks
of such an investment on his/her/its behalf, and that
he/she/it recognizes the highly speculative nature of this
investment.
4.3 The Consultant acknowledges that he/she/it has been
furnished by the Company during the course of evaluating
his/her/its interest in this transaction with all information
regarding the Company which he/she/it had requested or desired
to know; that all documents which could be reasonably provided
have been made available for his/her/its inspection and
review; that he/she/it has been afforded the opportunity to
ask questions of and receive answers from duly authorized
officers or other representatives of the Company concerning
the terms and conditions of the offering; that he/she/it has
read and fully understands and acknowledges those risk factors
associated with an investment in the Warrant which are
identified in public filings with the Securities and Exchange
Commission; and that any and all additional information which
he/she/it had requested has been provided.
4.4 The Consultant acknowledges that this offering of the
Warrant may involve tax consequences and that he/she/it has
received no opinions or statements from the Company in respect
of same. The Consultant further acknowledges that he/she/it
must retain his own professional advisors to evaluate the tax
and other consequences of an investment in the Warrant.
4.5 The Consultant acknowledges that he/she/it has not been
the subject of any general solicitation by the Company, and
that he/she/it knows of no general solicitation, including any
general advertising, by the Company in connection with the
sale of the Warrant.
4.6 The Consultant acknowledges that the Warrant, and the
underlying securities, have not been registered under the
Securities Act of 1933, or the securities laws of any state,
that the Warrant are being purchased for investment purposes
and not with a view to distribution or resale, nor with the
intention of selling, transferring or otherwise disposing of
all or any part of the Warrant for any particular price, or at
any particular time, or upon the happening of any particular
event or circumstances, except selling, transferring or
disposing of said Warrant in full compliance with all
applicable provisions of the Act, the Rules and Regulations
promulgated by the SEC thereunder or in connection therewith,
and applicable state securities laws. The Consultant further
acknowledges that such Warrant must be held indefinitely
unless they are subsequently registered under the Act, or an
exemption from such registration is available, and an opinion
of counsel is furnished stating that registration is not
required under the Act or such state securities laws.
4.7 The Consultant acknowledges that the certificates to be
issued may bear a legend containing the following or similar
words:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT") OR ANY OTHER SECURITIES LAWS. THESE SECURITIES HAVE
BEEN ACQUIRED FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO
DISTRIBUTION OR RESALE, AND MAY NOT BE TRANSFERRED, SOLD OR
OTHERWISE DISPOSED OF, OR OFFERED FOR TRANSFER, SALE OR OTHER
DISPOSITION IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR SUCH SECURITIES UNDER THE ACT, AND ANY OTHER
APPLICABLE SECURITIES LAWS, OR THE AVAILABILITY OF AN
EXEMPTION FROM REGISTRATION UNDER THE ACT AND ANY OTHER
APPLICABLE SECURITIES LAWS".
4.8 The Consultant hereby agrees to indemnify and hold
harmless the Company and each of its officers, directors,
affiliates, shareholders, employees, agents and attorneys
against any and all losses, claims, demands, liabilities and
expenses (including reasonable legal or other expenses as such
are incurred) incurred by each such person in connection with
defending or investigating any claims or liabilities, whether
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or not resulting in any liability to such person to which any
such indemnified party may become subject under the Act, under
any other statute, at common law or otherwise, insofar as such
losses, claims, demands, liabilities and expenses (a) arise
out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in this
Agreement, or (b) arise out of or are based upon any breach of
any representation, warranty or agreement contained herein.
5. Nonexclusivity of this Agreement. The Company expressly understands
and agrees that the Consultant shall not be prevented or barred from rendering
services of the same nature as, or a similar nature to, those described herein,
or of any nature whatsoever, for or on behalf of any person, firm, corporation
or entity other than the Company. The Consultant understands and agrees that the
Company shall not be prevented or barred from retaining other persons or
entities to provide services of the same nature or similar nature as those
described herein or of any nature whatsoever.
6. Disclaimer of Responsibility for Acts of the Company. The
obligations of the Consultant described in this Agreement consist solely of the
furnishing of information and advice to the Company. In no event shall the
Consultant be permitted or required by this Agreement to act as the agent of the
Company or otherwise to represent or make decisions for the Company. Consultant
is, and to be considered an Independent Contractor of the Company. All final
decisions with respect to acts of the Company, its subsidiaries or its
affiliates, whether or not made pursuant to or in reliance on information or
advice furnished by the Consultant hereunder, shall be those of the Company or
such subsidiaries or affiliates.
7. Acknowledgement. The Company acknowledges that Consultant is not a
registered broker-dealer and that Consultant cannot, and shall not be required
hereunder to, engage in the offer or sale of securities on behalf of the
Company. While Consultant has relationships and contacts with various investors,
broker-dealers, and investment funds, Consultant's participation in the actual
offer or sale of the Company securities shall be limited to that of an advisor
to the Company and a "finder" of investors, broker-dealers and funds. The
Company acknowledges and agrees that the solicitation and consummation of any
purchases of the Company's securities shall be handled by the Company or one or
more NASD member firms engaged by the Company for such purposes.
8. Confidentiality. The Consultant will not disclose to any other
person, firm, or corporation, nor use for its own benefit, during or after the
term of this Agreement, any trade secrets or other information designated as
confidential by the Company which is acquired by the Consultant in the course of
performing services hereunder. (A trade secret is information not generally
known to the trade which gives the Company an advantage over its competitors.
Trade secrets can include, by way of example, products or services under
development, production methods and processes, sources of supply, customer lists
and marketing plans.) Any consulting or other advice rendered by the Consultant
pursuant to this Agreement may not be disclosed publicly in any manner without
the prior written approval of the Consultant. Any information, which (i) at or
prior to the time of disclosure by the Company to the Consultant was generally
available to the public through no breach of this Agreement, (ii) was available
to the public on a nonconfidential basis prior to its disclosure by the Company
to the Consultant or (iii) was made available to the public from a third party
provided that such party did not obtain or disseminate such information in
breach of any legal obligation of the Consultant shall not be deemed
confidential information of the Company for purposes hereof.
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9. Amendment. No amendment to this Agreement shall be valid unless such
amendment is in writing and is signed by authorized representatives of all the
parties to this Agreement.
10. Waiver. Any of the terms and conditions of this Agreement may be
waived at any time and from time to time in writing by the party entitled to the
benefit thereof, but a waiver in one instance shall not be deemed to constitute
a waiver in any other instance. A failure to enforce any provision of this
Agreement shall not operate as a waiver of the provision or of any other
provision hereof.
11. Severability. In the event that any provision of this Agreement
shall be held to be invalid, illegal or unenforceable in any circumstances, the
remaining provisions shall nevertheless remain in full force and effect and
shall be construed as if the unenforceable portion or portions were deleted.
12. Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the internal laws of the State of New York.
13. Notices. All notices, requests, payments, instructions, claims or
other communications hereunder shall be in writing and shall be deemed to be
given or made when delivered by first-class, registered or certified mail to the
following address or addresses or such other address or addresses as the parties
may designate in writing in accordance with this Section:
If to the Company: Uncommon Media Group, Inc.
00 Xxxx 00xx Xxxxxx
0xx Xxxxx
Xxx Xxxx, XX 00000
With a copy to: Membrado & Montell, LLP
000 X. 00xx Xxxxxx
Xxx Xxxx, XX 00000
If to the Consultant: [ ]
Attn:
14. Assignment. This Agreement shall be binding upon and inure to the
benefit of the parties and their respective successors and assigns; provided,
however, that this Agreement shall not be binding on or inure to the benefit of
any successor or assign of the Consultant where, as a result of such succession
or assignment, control of the entity which would otherwise succeed to the rights
and obligations of this Agreement is materially different from the control of
the entity having such rights and obligations prior to such succession or
assignment.
15. Entire Contract. This Agreement shall constitute the only agreement
between the Company and the Consultant. No representations, promises,
understandings, or agreements, oral or otherwise, not herein contained shall be
of any force or effect.
16. Captions. The captions and headings contained herein are solely for
convenience and reference and do not constitute a part of this Agreement or
affect in any way the meaning or interpretation of this Agreement.
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17. Severability. To the extent possible, each provision of this
Agreement shall be interpreted in a manner as to be valid, legal and
enforceable. Any term of provision of this Agreement which is invalid or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
solely to the extent of such provision which is invalid or unenforceable within
rendering invalid or unenforceable the remaining terms and conditions hereof.
18. Execution in Counterparts. This Agreement may be executed by the
parties in separate counterparts, each of which when so executed and delivered
shall be deemed to be an original and all of which when taken together shall
constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of this 24th day of July, 2001.
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Xxxxx Xxxxx
UNCOMMON MEDIA GROUP, INC.
By:____________________________
Name:
Title:
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EXHIBIT A
FORM OF WARRANT
OPTION AGREEMENT dated as of July 24, 2001, between Uncommon Media
Group, Inc., a Florida corporation with an office located at 00 Xxxx 00xx
Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx (the "Company") and Xxxxx Xxxxx, an
individual with an address of _________________(together with any assigns
thereof, the "Holder").
WHEREAS, the Company and Consultant have entered into a consulting
agreement dated as of the date hereof (the "Consulting Agreement"), and
WHEREAS, pursuant to the terms of the Consulting Agreement, the Company
has agreed to issue consultant an option (the "Option") to purchase a certain
number of common shares of the Company, par value $.001 per share (the "Common
Stock");
NOW, THEREFORE, in consideration of the agreements herein set forth and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
1. Grant. Pursuant to the terms of the Consulting Agreement, Holder is
hereby granted the right to purchase, at any time from and after the date
hereof, until 5:00 P.M., EST, on July 24, 2004 up to 100,000 Shares at an
initial exercise price of $.40 per Share. The Option granted pursuant hereto
shall be evidenced in a certain certificate annexed hereto as Exhibit A (the
"Option Certificate") in which all other terms and conditions associated with
the Option shall be expressly set forth.
2. Authorization. The Company has full corporate power and authority to
execute and deliver this Option Agreement and the Option Certificate annexed
hereto, and this Option Agreement and the Option Certificate, once executed and
delivered, constitutes the valid and legally binding obligation of the Company,
enforceable in accordance with its terms and conditions.
3. Governing Law. This Agreement shall be deemed to be a contract made
under the laws of the State of New York and for all purposes shall be construed
in accordance with the laws of the State of New York without regard to conflict
of laws.
4. Counterparts. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and such counterparts shall together constitute but one and the
same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the day and year first above written.
UNCOMMON MEDIA GROUP, INC. Xxxxx Xxxxx
By:__________________________ __________________________
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THE SECURITIES REPRESENTED BY THIS WARRANT CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF (i) AN EFFECTIVE REGISTRATION
STATEMENT AS TO SUCH SECURITIES UNDER SAID ACT, (ii) AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY, OR NO-ACTION LETTER ISSUED BY THE SECURITIES AND
EXCHANGE COMMISSION, THAT SUCH REGISTRATION IS NOT REQUIRED, OR (Iiii) UNLESS
SOLD PURSUANT TO, AND IN COMPLIANCE WITH THE REQUIREMENTS OF, RULE 144 OF SUCH
ACT.
Uncommon Media Group, INC.
COMMON STOCK PURCHASE OPTION
Void after 5:00 PM EST Right to Purchase 100,000
July 24, 2004 shares of Common Stock
(subject to adjustment)
No. W-0003
Uncommon Media Group, Inc. (the "Company"), a Florida corporation,
hereby certifies that, for value received, Holder (as hereinafter defined), is
entitled, subject to the terms set forth herein, to purchase from the Company at
any time or from time to time before 5:00 P.M. E.S.T., on July 24, 2004, fully
paid and nonassessable shares of Common Stock, $.001 par value, of the Company,
at the purchase price per share of $.40 (the "Purchase Price"). The number and
character of such shares of Common Stock and the Purchase Price are subject to
adjustment as provided herein.
This Option Certificate is the Common Stock Purchase Option (the
"Option"), evidencing the right to purchase shares of Common Stock of the
Company, issued pursuant to a certain Option Agreement (the "Agreement"), dated
as of July 24, 2001, between the Company and Xxxxx Xxxxx or his assigns (the
"Holder"). This Option evidences a right to purchase an aggregate of 100,000
shares of Common Stock of the Company, subject to adjustment as provided herein.
As used herein the following terms, unless the context otherwise
requires, have the following respective meanings:
(a) The term "Company" includes, in addition to the Company
itself, any corporation which shall succeed to or assume the
obligations of the Company hereunder.
(b) The term "Common Stock" includes all stock of any class or
classes (however designated) of the Company, authorized on or after the
date hereof, the holders of which shall have the right, without
limitation as to amount, either to all or to a share of the balance of
current dividends and liquidating dividends after the payment of
dividends and distributions on any shares entitled to preference, and
the holders of which shall ordinarily, in the absence of contingencies,
be entitled to vote for the election of a majority of directors of the
Company (even though the right so to vote has been suspended by the
happening of such a contingency).
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(c) The term "Other Securities" refers to any stock (other
than Common Stock) and other securities of the Company or any other
Person (corporate or otherwise) which the holder of the Option at any
time shall be entitled to receive, or shall have received, on the
exercise of the Option, in lieu of or in addition to Common Stock, or
which at any time shall be issuable or shall have been issued in
exchange for or in replacement of Common Stock or Other Securities
pursuant to Section 6 or otherwise.
(d) The term "Person" shall have that meaning ascribed in the
Securities Act of 1933, as amended.
(e) The term "Shares" means the Common Stock of the Company
issued or issuable upon exercise of the Option.
1. Exercise of Option.
This Option, or any part hereof, is exercisable at a price of $.40 per share,
subject to adjustment as hereinafter provided. Upon delivery of notice of
intention to exercise all or any part of this Option, together with payment of
the Purchase Price for the Shares purchased at the Company's principal offices,
the Holder shall be entitled to receive a certificate or certificates for the
Shares so purchased in those denominations set forth in such notice by Holder.
Payment of the Purchase Price shall be made by cash, money order, certified or
bank cashier's check or wire transfer. In the event of the exercise of less than
all of the Shares purchasable under this Option, the Company shall, at its
expense, amend this Option so as only to reduce the number of Shares to which it
may thereafter be exercised.
2. Adjustment of Purchase Price and Number of Shares.
2.1 (a) In case the Company shall (i) pay a dividend on its Common
Stock in Common Stock, (ii) subdivide its outstanding shares of Common Stock, or
(iii) combine its outstanding shares of Common Stock into a small number of
shares, then, in such an event, the Purchase Price in effect immediately prior
thereto shall be adjusted proportionately so that the adjusted Purchase Price
will bear the same relation to the Purchase Price in effect immediately prior to
any such event as the total number of shares of Common Stock outstanding
immediately prior to any such event shall bear to the total number of shares of
Common Stock outstanding immediately after such event. An adjustment made
pursuant to this subdivision (a), (i) shall become effective retroactively
immediately after the record date in the case of a dividend and (ii) shall
become effective immediately after the effective date in the case of a
subdivision or combination. The Purchase Price, as so adjusted, shall be
readjusted in the same manner upon the happening of any successive event or
events described herein.
2.2. Upon each adjustment of the Purchase Price pursuant to subdivision
(a) of Subsection 2.1, the number of shares of Common Stock purchasable upon
exercise of this Option Certificate shall be adjusted to the number of shares of
Common Stock, calculated to the nearest one hundredth of a share, obtained by
multiplying the number of shares of Common Stock purchasable immediately prior
to such adjustment upon the exercise of this Option Certificate by the Purchase
Price in effect prior to such adjustment and dividing the product so obtained by
the new Purchase Price.
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2.3 In case of any capital reorganization of the Company, or of any
reclassification of the Common Stock, this Option Certificate shall be
exercisable after such capital reorganization or reclassification upon the terms
and conditions specified in this Option Certificate, for the number of shares of
stock or other securities which the Common Stock issuable (at the time of such
capital reorganization or reclassification) upon exercise of this Option
Certificate would have been entitled to receive upon such capital reorganization
or reclassification if such exercise had taken place immediately prior to such
action. The subdivision or combination of shares of Common Stock at any time
outstanding into a greater or lesser number of shares of Common Stock shall not
be deemed to be a reclassification of the Common Stock of the Company for the
purposes of this Subsection 2.3.
2.4 The form of this Option Certificate need not be changed because of
any change in the Purchase Price pursuant to this Section 2 and any Option
Certificate issued after such change may state the same Purchase Price and the
same number of shares of Common Stock as are stated in this Option Certificate
as initially issued.
3. Adjustment for Reorganization, Consolidation, Merger, Etc.
3.1 Merger, Etc. In case at any time or from time to time after the
date of this Option, the Company shall (a) effect a reorganization, (b)
consolidate with or merge into any other Person, or (c) transfer all or
substantially all of its properties or assets to any other Person under any plan
or arrangement contemplating the dissolution of the Company within 24 months
from the date of such transfer (any such transaction being hereinafter sometimes
referred to as a "Reorganization") then, in each such case, the Holder, upon the
exercise hereof as provided in Section 1 at any time after the consummation or
effective date of such Reorganization (the "Effective Date"), shall receive, in
lieu of the Shares issuable on such exercise prior to such consummation or such
effective date, the stock and other securities and property (including cash) to
which such Holder would have been entitled upon such consummation or in
connection with such dissolution, as the case may be, if such holder had so
exercised this Option immediately prior thereto (all subject to further
adjustment thereafter as provided in Section 2, provided that the successor
corporation in any such Reorganization described in clause (b) or (c) above
where the Company will not be the surviving entity (the "Acquiring Company") has
agreed prior to such Reorganization in a writing satisfactory in form and
substance to the Holder that this Option shall continue in full force and effect
and the terms hereof shall be applicable to the shares of stock and other
securities and property receivable on exercise after the consummation of such
Reorganization, and shall be binding upon the issuer of any such stock or other
securities (including, in the case of any transfer of properties or assets
referred to above, the Person acquiring all or substantially all of the
properties or assets of the Company).
3.2 Continuation of Terms. This Option shall continue in full force and
effect and the terms hereof shall be applicable to the shares of stock and other
securities and property receivable on the exercise of this Option after the
consummation of such reorganization, consolidation or merger or the effective
date of dissolution following any such transfer, as the case may be, and shall
be binding upon the issuer of any such stock or other securities, including, in
the case of any such transfer, the Person acquiring all or substantially all of
the properties or assets of the Company, whether or not such Person shall have
expressly assumed the terms of this Option as provided in Section 3.1.
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4. Replacement of Options.
On receipt of evidence reasonably satisfactory to the Company of the loss,
theft, destruction or mutilation of any Option and, in the case of any such
loss, theft or destruction of any Option, on delivery of an indemnity agreement
or security reasonably satisfactory in form and amount to the Company or, in the
case of any such mutilation, on surrender and cancellation of such Option, the
Company at its expense will execute and deliver, in lieu thereof, a new Option
of like tenor.
5. Negotiability, Assignment, etc.
This Option may not be transferred without the written consent of the Company.
6. Notice, etc.
All notices and other communications from the Company to the Holder shall be
mailed by first class registered or certified mail, postage prepaid, at such
address as may have been furnished to the Company in writing by Holder or, until
any such holder furnishes to the Company an address, then to, and at the address
of, the Holder of this Option who has so furnished an address to the Company.
6. Miscellaneous.
This Option and any term hereof may be changed, waived, discharged or terminated
only by an instrument in writing signed by the party against which enforcement
of such change, waiver, discharge or termination is sought. This Option is being
delivered in the State of New York and shall be construed and enforced in
accordance with and governed by its laws. The headings in this Option are for
purposes of reference only, and shall not limit or otherwise affect any of the
terms hereof. This Option is being executed as an instrument under seal. All
nouns and pronouns used herein shall be deemed to refer to the masculine,
feminine or neuter, as the identity of the person or persons to whom reference
is made herein may require.
13. Expiration.
The right to exercise this Option shall expire at 5:00 P.M., E.S.T, on July 24,
2004.
Dated: UNCOMMON MEDIA GROUP, INC.
By:________________________
Name: Xxxxxxxx Xxxxx
Title: President
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