CONSULTING AGREEMENT
AGREEMENT made as of the 26th Day of January 2000, by and between
PARADISE MUSIC & ENTERTAINMENT, INC., a Delaware corporation (the "Company"),
and Xxxxxx Xxxxxx (the "Consultant").
W I T N E S S E T H:
WHEREAS, the Company wishes to engage the Consultant to render
certain services to it and the Consultant wishes to accept such engagement, upon
the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
hereto agree as follows:
1. Engagement
The Company agrees to engage the Consultant during the Term
specified in paragraph 2, and the Consultant agrees to accept such engagement,
upon the terms and conditions hereinafter set forth.
2. Term
Subject to the terms and conditions of this Agreement, the
Consultant's engagement by the Company shall be for a term commencing on the
date hereof and expiring on January 25, 2001 (the "Term").
3. Duties and Responsibilities
(a) During the Term, the Consultant will review (including by
preparing due diligence investigations), analyze and assist in the structuring
of proposed business ventures between the Company and third parties which
ventures may originate either from the Consultant, the Company or otherwise. The
services provided hereunder are in addition to those provided by the Consultant
as a director of the Company for which the Consultant is separately compensated.
(b) During the Term, the Consultant agrees that he will (i) devote
sufficient time as shall be necessary to properly carry out his obligations
under is agreement; (ii) carry out his duties in a competent and professional
manner, and (iii) work with the employees of the Company in a competent and
professional manner. Notwithstanding the foregoing, the Consultant shall be
permitted to engage in other business activities (as an active participant or a
passive investor), provided that such activities are not rendered for a company
whose business is in competition with the Company and provided that such
activities (individually or collectively) do not violate the provisions of
paragraph 6 below or materially interfere with the performance of his duties or
responsibilities under this Agreement.
4. Compensation
For all services during the Term, the Consultant will receive 25,000
warrants to purchase shares of the Company's Common Stock at $5.00 per share.
The warrants will be for a two year period, will be issued on the date hereof,
and will vest immediately on the date hereof. The warrants will be exercisable
commencing immediately from the date hereof and will have piggyback registration
rights for one piggyback registration at any time after the first anniversary of
the date of the warrant subject to underwriters holdback or limitation on the
number of shares to be included. No other compensation is being paid to
Consultant for services under this Agreement. The warrants must be approved by
the stockholders of the Company before they can
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be issued. In the event that the issuance of the warrants is not approved by the
stockholders other mutually agreed upon compensation shall be paid to the
consultant in lieu of such warrants.
5. Expenses
Except as otherwise agreed in writing between the Company and the
Consultant, the Company shall be under no obligation to pay or to reimburse the
Consultant during the Term for his expenses incurred in the performance of his
services hereunder.
6. Non-Competition and Protection of Confidential Information
(a) The Consultant acknowledges that his rendering of services
hereunder may require the disclosure to the Consultant of confidential
information and trade secrets of the Company and consequently he agrees that it
is reasonable and necessary for the protection of the goodwill and business of
the Company that he makes the covenants contained herein. Accordingly, the
Consultant agrees that during the Term he shall not, except on behalf of the
Company, directly or indirectly:
(i) attempt in any manner to persuade any customer, supplier
or client of the Company to cease to do business or to reduce the
amount of business which any such customer, supplier or client has
customarily done or contemplates doing with the Company, unless the
Consultant has a previous client relationship with such customer,
supplier or client;
(ii) solicit to employ as an employee anyone who is then or at
any time during the preceding twelve months was an employee of the
Company; provided, however, if such employee was involuntarily
terminated by the Company, the Consultant may employ such person
after obtaining the prior written consent of the Company, which
consent will not be unreasonably withheld; or
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(b) The Consultant agrees that he will not, except as required by
law or court order, at any time during the Term and for a two year period after
termination of this Agreement, disclose to anyone any confidential information
or trade secret of the Company, or utilize such confidential information or
trade secret for his own benefit, or for the benefit of third parties. The term
"confidential information or trade secret" does not include information which
(i) becomes generally available to the public other than by breach of this
provision; (ii) the Consultant learns from a third party who is not under an
obligation of confidence to the Company; (iii) is independently developed by the
Consultant; or (iv) is known by the Consultant prior to disclosure to the
Consultant by the Company.
(c) If the Consultant commits a breach or is about to commit a
breach, of any of the provisions of paragraphs 6(a) or (b) above, the Company
shall have the right to have the provisions of this Agreement specifically
enforced by any court having equity jurisdiction without being required to post
bond or other security and without having to prove the inadequacy of the
available remedies at law, it being acknowledged and agreed that any such breach
or threatened breach will cause irreparable injury to the Company and that money
damages will not provide an adequate remedy to the Company. In addition, the
Company may take all such other actions and remedies available to it under law
or in equity and shall be entitled to such damages as it can show it has
sustained by reason of such breach. The parties acknowledge that the type and
periods of restriction imposed in the provisions of paragraphs 6(a) and (b)
above are fair and reasonable and are reasonably required for the protection of
the Company, and that the time, scope, geographic area and other provisions of
this paragraph 6 have been specifically negotiated by both parties with advice
of counsel. If any of the covenants in paragraphs 6(a) or (b) above, or any part
thereof, is hereafter construed to be invalid or unenforceable, the same shall
not affect the remainder of the covenant or covenants, which shall be given full
effect, without regard to the invalid portions. If any of the covenants
contained in paragraphs 6(a) or (b), or any part thereof, is held to be
unenforceable because of the duration of such provision or the area covered
thereby, the parties agree that the court making such determination shall have
the
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power to reduce the duration and/or areas of such provision and, in its reduced
form, such provision shall then be enforceable.
7. Enforceability
The failure of any party at any time to require performance by
another party of any provision hereunder shall in no way affect the right of
that party thereafter to enforce the same, nor shall it affect any other party's
right to enforce the same, or to enforce any of the other provisions in this
Agreement; nor shall the waiver by any party of the breach of any provision
hereof be taken or held to be a waiver of any subsequent breach of such
provision or as a waiver of the provision itself.
8. Assignment
This Agreement is a personal contract and the Consultant's rights
and obligations hereunder may not be transferred, assigned, pledged or
hypothecated by the Consultant. The rights and obligations of the Company
hereunder shall be binding upon and run in favor of the successors and permitted
assigns of the Company. If the Company shall be merged into or consolidated with
another entity, the provisions of this Agreement shall be binding upon and inure
to the benefit of the entity surviving such merger or resulting from such
consolidation. If all or substantially all of the assets of the Company are
transferred to another entity, the Company shall cause the entity acquiring such
assets to assume and be responsible for the Company's obligations hereunder.
9. Modification; Renewal
This Agreement may not be orally canceled, changed, modified or
amended, and no cancellation, change, modification or amendment shall be
effective or binding, unless in writing and signed by the parties to this
Agreement. Any renewal of this Agreement beyond the period specified in
paragraph 2 above shall be set forth in a writing executed by both parties
hereto.
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10. Severability; Survival
In the event any provision or portion of this Agreement is
determined to be invalid or unenforceable for any reason, in whole or in part,
the remaining provisions of this Agreement shall nevertheless be binding upon
the parties with the same effect as though the invalid or unenforceable part had
been severed and deleted. The respective rights and obligations of the parties
hereunder shall survive the termination of the Consultant's employment to the
extent necessary to the intended preservation of such rights and obligations.
11. Notice
Any notice, request, instruction or other document to be given
hereunder by any party hereto to another party shall be in writing and shall be
deemed effective (a) upon personal delivery, if delivered by hand, or (b) three
days after the date of deposit in the mails, postage prepaid if mailed by
certified or registered mail, or (c) on the next business day, if sent by
facsimile transmission (if electronically confirmed) or prepaid overnight
courier service, and in each case, addressed as follows:
If to the Consultant:
Xxxxxx Xxxxxx
X.X Xxx 0000
Xxxxxxxxxx, XX 00000
If to the Company:
Paradise Music & Entertainment, Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
with a copy to:
Xxxxxx X. Xxxxxxx, Esq.
Xxxxx & Xxxxxxx LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Any party may change the address to which notices are to be sent by giving
notice of such change of address to the other party in the manner herein
provided for giving notice.
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12. Applicable Law
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York, without application of conflict of law
provisions applicable herein. This Agreement shall be deemed to have been
executed and delivered in the State of New York. In any legal action relating to
this Agreement, the parties each agree (a) to the exercise of jurisdiction over
it or him in a state or Federal court in New York County, New York and (b) that
such action shall be initiated in one of the courts specified in clause (a)
above.
13. Entire Agreement
This Agreement represents the entire agreement between the Company
and the Consultant with respect to the subject matter hereof, and all prior
agreements relating to the employment of the Consultant by the Company, written
or oral, are nullified and superseded hereby.
14. Litigation
In any litigation relating to this Agreement, the prevailing party
shall be entitled to reimbursement from the other party for its or his
reasonable attorneys fees and reasonable out-of-pocket costs related to such
litigation.
15. Headings
The headings contained in this Agreement are for reference purposes
only, and shall not affect the means or interpretation of this Agreement.
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16. Independent Contractor
The Consultant acknowledges that all services performed for the
Company shall be as an independent contractor and that the Consultant therefore
shall be responsible for the collection and payment of all withholdings,
contributions and payroll taxes relating to his services. The Consultant further
agrees to indemnify and hold harmless the Company against any loss, costs or
liabilities, including attorneys' fees, that the Company may incur as a result
of the Consultant's obligations under this paragraph 16. The Consultant also
acknowledges that his engagement as an independent contractor shall not
constitute the Consultant the agent or employee of the Company and the
Consultant shall not have the authority to contract in the name or on behalf of
the Company, or to commit the Company in any respect, except upon the prior
written instructions of the Chief Executive Officer of the Company.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
PARADISE MUSIC & ENTERTAINMENT, INC.
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Name:
Title:
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Xxxxxx Xxxxxx
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