CONSULTING AGREEMENT
This Consulting Agreement (the "Agreement"), effective as of this 14th day of
September, 2005 (the "Effective Date") is entered into by and between, KBM
Consulting, Inc. (herein referred to as the "Consultant") and Megola, Inc.,
(here in referred to as the "Company").
RECITALS
WHEREAS, Company desires to engage the services of Consultant to consult, assist
and advise the Company in identifying investor relations and/or public relations
and/or market relations organizations to be utilized by the Company and
assisting the Company with such investor relations and/or public relations
and/or market relations organizations which are engaged by the Company;
NOW THEREFORE, in consideration of the promises and the mutual covenants and
agreements hereinafter set forth, the parties hereto covenant and agree as
follows:
1. Term of Consultancy. Company hereby agrees to retain the Consultant to act
in a consulting capacity to the Company, and the Consultant hereby agrees
to provide services to the Company commencing on the Effective Date and
ending 6 Months from the Effective Date unless terminated pursuant to
Section 8 of this Agreement.
2. Services. During the term of this Agreement, Consultant's services may
include, but will not necessarily be limited to providing the following
services on behalf of and for the benefit of the Company:
A. Analyze Company's needs with respect to public relations and/or
investor relations and/or market relations.
B. Oversee and facilitate, for the benefit of the Company, any and all
investor relations and/or public relations and/or market relations
organizations which are engaged by the Company;
C. Consult and assist the Company in developing and implementing
appropriate plans and means for presenting the Company and its
business plans, strategy and personnel to the financial community.
D. Assist and advise the company with respect to its relations with
brokers, dealers, analysts, and other investment professionals.
E. Otherwise perform as the Company's consultant for public relations
and/or investor relations and/or market relations.
F. Short and long term strategic planning.
G. Short term crisis management.
H. Short and long term marketing.
I. Meeting with/selecting qualified companies for joint business
ventures.
J. Contracting and interviewing qualified accounting firms and legal
counsel.
K. Recruitment selection of key executives and staff
L. Internet and website design.
M. Recommending and identifying of board members, with all such
services (the "Services") on the terms and subject to the condition
set forth herein.
N. Assist and advise the company in introduction to various market
makers, investment banking and small cap firms.
O. Assist and advise the company in the process of potentially moving
from the OTCBB to AMEX/NASDAQ listing.
3. Allocation of Time and Energies. The Consultant hereby promises to perform
and discharge faithfully the responsibilities, which may be assigned to
the Consultant from time to time by the officers and duly authorized
representatives of the Company under this Agreement. Consultant and staff
shall diligently and thoroughly provide the consulting services required
hereunder. Although no specific hours-per-day requirement will be
required, Consultant and the Company agree that Consultant will perform
the duties set forth herein above in a diligent and professional manner.
4. Remuneration. As full and complete compensation for services described in
this Agreement, the Company shall compensate Consultant as follows:
4.1 For undertaking this engagement and for other good and valuable
consideration, the Company agrees to cause to be delivered to the
Consultant 1,200,000 restricted shares of the Company's Common Stock
with Piggy Back registration rights. These shares represent less
than 5% of the issued and outstanding shares of common stock in the
Company. The Company agrees to file the associated registration no
later than 45 days from the date of this agreement; the Company
acknowledging that (i) since time is of the essence, failure to file
within the time set forth above will result in the penalty issuance
of additional shares to Consultant of 5% per additional 30 day
period and (ii) such penalty shares will, in turn, also be added to
the Piggy Back right being extended by this Agreement to Consultant.
The Company understands and agrees that Consultant has foregone
significant opportunities to accept this engagement. The shares of
Common Stock issued as a Commencement Bonus, therefore, constitute
payment for Consultant's agreement to consult to the Company and are
a nonrefundable, non-apportion able, and non-ratable retainer; such
shares of common stock are not a prepayment for future services. If
the Company decides to terminate this Agreement after entered into
for any reason whatsoever, it is agreed and understood that
Consultant will not be requested or demanded by the Company to
return any of the shares of Common Stock paid to it as Commencement
Bonus hereunder. Further, if and in the event the Company is
acquired in whole or in part, during the term of this Agreement, it
is agreed and understood Consultant will not be requested or
demanded by the Company to return any of the shares of Common Stock
paid to it hereunder. It is further agreed that if at any time
during the term of this agreement, the Company or substantially all
of the Company's assets are merged with or acquired by another
entity, or some other change occurs in the legal entity that
constitutes the Company, the Consultant shall retain and will not be
requested by the Company to return any of the shares of Common
Stock.
4.2 With each transfer of shares of Common Stock to be issued pursuant
to this Agreement (collectively, the "Shares"). Company shall cause
to be issued a certificate representing the Common Stock and a
written opinion of counsel for the Company stating that said shares
are validly issued, fully paid and non-assessable and that the
issuance and eventual transfer of them to Consultant has duly
authorized by the Company. Company warrants that all Shares issued
to Consultant pursuant to this Agreement shall have been validly
issued, fully paid and non-assessable and that the Company's board
of directors shall have duly authorized the issuance, and any
transfer of them to Consultant.
5. Non-Assign ability of Services. Consultant's services under this contract
are offered to Company only and may not be assigned by Company to an
entity with which Company merges or which acquires the Company or
substantially all of its assets. In the event of such merger or
acquisition, all compensation to Consultant herein under the schedules set
forth herein shall remain due and payable, and any compensation received
by the Consultant may be retained in the entirety by Consultant, all
without any reduction or pro-rating and shall be considered and remain
fully paid and non-assessable. Notwithstanding the non-assign ability of
Consultant's services, Company shall assure that in the event of any
merger, acquisition, or similar change of form of entity, that its
successor entity shall agree to complete all obligations to Consultant,
including the provision and transfer of all compensation herein and the
preservation of the value thereof consistent with the rights granted to
Consultant by the Company herein, and to Shareholders.
6. Indemnification. The Company warrants and represents that all oral
communications, written documents or materials furnished to Consultant by
the Company with respect to financial affairs, operations, profitability
and strategic planning of the Company are accurate and Consultant may rely
upon the accuracy thereof without independent investigation. The Company
will protect, indemnity and hold harmless Consultant (including its
officers, directors, employees and agents) against any claims or
litigation including any damages, liability, cost and reasonable
attorney's lees as incurred with respect thereto resulting from
Consultants communication or dissemination of any said information,
documents or materials. Company further agrees to protect, indemnity and
hold harmless Consultant (including its officers, directors, employees and
agents) against any claims or litigation including any damages, liability,
cost and reasonable attorney's fees as incurred with respect thereto
resulting from any and all breaches by Company and/or Company's officers,
directors, employees, agents, and any and all market relations, public
relations and investor relations organizations introduced to Company by
Consultant and subsequently engaged by Company, including
misrepresentations and/or omission of fact and from any and all violations
of applicable laws and regulations.
7. Representations. Consultant represents that it is not required to maintain
any licenses and registrations under federal or any state regulations
necessary to perform the services set forth herein. Consultant further
acknowledges that it is not a securities Broker Dealer or a registered
investment advisor and is not and will not perform any tasks, which
require Consultant to be licensed as such. Company acknowledges that, to
the best of its knowledge, that it has not violated any rule or provision
of any regulatory agency having jurisdiction over the Company. Company
acknowledges that, to the best of its knowledge, Company is not the
subject of any investigation, claim, decree or judgment involving any
violation of the SEC or securities laws. Both Company and Consultant
acknowledge that Company is under no obligation to follow and/or act in
accordance with the recommendations made by Consultant in connection with
this Agreement. Company represents that its decision to not act in
accordance with Consultant's recommendations in no way effects Company's
obligations as set forth in Section 4 et. Seq. hereinabove. Company
acknowledges that it remains responsible to perform any and all additional
due diligence it deems necessary and appropriate respecting the investor
relations, market relations and public relations organizations introduced
to it by Consultant. Company further represents and acknowledges that
Consultant is not responsible and not liable for the actions taken by
those investor relations, market relations and public relations
organizations that are introduced to it by Consultant and subsequently
engaged by Company.
8. Termination. This Agreement may be terminated by Consultant during the
Term hereof by notice to the Company in the event that the Company shall
have provided materially inaccurate or misleading information, of any type
or nature, to the Consultant, or failed or been unable to comply in any
material respect with any of the terms, conditions or provisions of this
Agreement on the part of the Company to be performed, complied with or
fulfilled within the respective times, if any, herein provided for, unless
compliance therewith or the performance or satisfaction thereof shall have
been expressly waived by Consultant in writing. Any termination of this
Agreement pursuant to this Section 8 shall be without liability of any
character (including, but not limited to, loss of anticipated profits or
consequential damages) on the part of the Company, except that the Company
shall remain obligated to pay the fees, other compensation and costs
otherwise to be paid, as set forth in Sections 4 and 5 hereof.
9. Legal Representation. The Company acknowledges that independent legal
counsel in the preparation of this Agreement has represented it.
Consultant represents that it has consulted with independent legal counsel
and/or tax, financial and business advisors, to the extent the Consultant
deemed necessary.
10. Status as Independent Contractor. Consultant's engagement pursuant to this
Agreement shall be as independent contractor, and not as an employee,
officer or other agent of the Company. Neither party to this Agreement
shall represent or hold itself out to be the employer or employee of the
other. Consultant further acknowledges the consideration provided
hereinabove is a gross amount of consideration and that the Company will
not withhold from such consideration any amounts as to income taxes,
social security payments or any other payroll taxes. All such income taxes
and other such payment shall be made or provided for by Consultant and the
Company shall have no responsibility or duties regarding such matters.
Neither the Company nor the Consultant possesses the authority to bind
each other in any agreements without the express written consent of the
entity to be bound.
11. Waiver. The waiver by either party of a breach of any provision of this
Agreement by the other party shall not operate or be construed as a waiver
of any subsequent breach by such other party.
12. Notices. Any notices or other communications required or permitted
hereunder shall be sufficiently given if personally delivered, or sent by
express mail or telegram, or transmitted by fax or e-mail, addressed as
set forth herein below.
If to Consultant:
KBM Consulting, Inc.
If to the Company:
Megola, Inc.
13. Confidentially. This entire Agreement, including the terms of this
Agreement, shall remain confidential in its entirety and will not be
disclosed to anyone without first receiving written consent to do so. This
is a material part of this Agreement.
14. Complete Agreement. This Agreement contains the entire agreement of the
parties relating to the subject matter hereof. This Agreement and its
terms may not be changed orally but only by an agreement in writing signed
by the party against whom enforcement of any waiver, change, modification,
extension or discharge is sought. In the event that any particular
provision or provisions of this Agreement shall for any reason hereafter
be determined to be unenforceable, or in violation of any law,
governmental order or regulation, such unenforceability or violation shall
not affect the remaining provisions of this Agreement, which shall
continue in full force and be binding upon the respective parties hereto.
The language of this Agreement shall be construed as a whole, according to
its fair meaning and intent, and not strictly for or against either party
hereto, regardless of who drafted or was principally responsible for
drafting the Agreement or the terms or conditions hereof
AGREED TO:
KBM Consulting, Inc.
Date:
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By:
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▇▇▇▇ ▇▇▇▇▇▇, President
Megola, Inc.
Date:
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By:
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▇▇▇▇ ▇▇▇▇▇▇▇, President
