Exhibit 10.1
CATALYST FINANCIAL CORP.
▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
THIS FINANCIAL CONSULTING AGREEMENT, made as of the ___ day of ____,
1998, is by and between ▇▇▇▇▇▇ International Ltd., an Ontario, Canada
corporation (the "Company"), with its principal place of business at ▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ and Catalyst Financial Corp., a Florida
corporation ("Catalyst"), having its principal place of business at ▇▇▇ ▇.
▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇.
R E C I T A L S:
A. The Company is a public company with a class of equity securities
publicly traded, and desires to retain Catalyst to provide certain financial
consulting services.
B. Catalyst desires to provide certain financial consulting services to
the Company in accordance with the terms and conditions contained hereinafter.
NOW, THEREFORE, in consideration of the mutual promises set forth
herein, the parties hereto hereby agree as follows:
1. Consulting Services. During the term of this Agreement, Catalyst is
hereby retained by the Company to provide financial consulting services to the
Company, to include, among other things, services related to merger &
acquisition activities, strategic planning and general corporate finance
matters. Nothing hereunder shall require Catalyst to devote a minimum number of
hours per calendar month toward the performance of services hereunder. Unless
otherwise agreed to by Catalyst, all services hereunder shall be performed by
Catalyst, in its sole discretion, at its principal place of business or other
offices. Notwithstanding anything contained herein to the contrary, the services
to be performed by Catalyst hereunder may be performed by any employee of or
consultant to Catalyst.
2. Term. The term of this Agreement shall be for two years commencing
as of the date first written above and terminating one day prior to the second
anniversary hereof. Thereafter, this Agreement shall be renewed for subsequent
one year terms upon mutual agreement of the parties. This Agreement shall be
terminable by either party upon 30 days notice.
3. Compensation; Reimbursement of Expenses. In consideration for the
performance of services hereunder, the Company hereby agrees to pay Catalyst the
aggregate sum of $________, representing the full payment due, which will be
paid as of the date first written above. The Company further hereby agrees to
pay the reasonable out-of-pocket expenses incurred by Catalyst in connection
with such services to be rendered hereunder. Catalyst may, from time to time,
deem it to be in the best interests of the Company to retain an outside
consultant in connection with certain specific acquisitions or proposed
transactions. Catalyst agrees to obtain
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the written consent of the Company prior to retaining such consultant. In
such event, the Company agrees to pay any and all fees and expenses of such
consultant.
4. Finder's Fee. In the event the Company effectuates a financial
reorganization, strategic alliance, merger, joint venture, acquisition of a
specific product line or brand name or similar transaction subsequent to the
date hereof and on or prior to one year from the date of termination of this
Agreement, irrespective of any reason for such termination (the "Term"), and
such financial reorganization, strategic alliance, merger, joint venture,
acquisition or similar transaction is effectuated as a result or consequence of
any introduction made directly or indirectly by Catalyst, including, without
limitation, any introduction made by any third party to whom the Company was
originally introduced, then the Company hereby agrees to pay Catalyst the
following cash consideration, which payment shall be due and payable in cash on
the date of any such closing with respect thereto:
5% of the consideration from $1 and up to $5,000,000, plus
4% of the consideration in excess of $5,000,000 and up to
$10,000,000, plus
3% of the consideration in excess of $10,000,000 and up to
$15,000,000, plus
2% of the consideration in excess of $15,000,000 and up to
$20,000,000, plus
1% of the consideration in excess of $20,000,000.
In addition, if during the Term of the Agreement, the Company
effectuates a financial reorganization, strategic alliance, merger, joint
venture, acquisition of a specific product line or brand name or similar
transaction not arranged, directly or indirectly, by Catalyst, the Company
hereby agrees to retain Catalyst to act as its financial advisor in connection
with such financial reorganization, strategic alliance, merger, joint venture,
acquisition or similar transaction and shall pay Catalyst a fee equal to the
following percentages based upon the value of the transaction:
2% of the consideration from $1 and up to $5,000,000, plus
1% of the consideration in excess of $5,000,000.
For purposes of this Agreement, "consideration" shall mean the value of
the transaction described herein and shall include the aggregate value of all
cash, securities, and other property and consideration of every kind, including
but not limited to assumption and forgiveness of indebtedness, the maximum gross
amount realizable under the terms of an "earn-out" provision, rights to receive
periodic payments and all other rights that may be at any time either (i)
transferred or contributed to the Company, its affiliates or shareholders in
connection with an acquisition of equity or assets thereof, or (ii) transferred
or contributed by the Company, its affiliates or shareholders in any transaction
involving an investment in or acquisition of any third party, or acquisition of
the equity or assets thereof, by the Company or any affiliate thereof, or (iii)
transferred or contributed by the Company, its affiliates or shareholders and
any other parties entering into any joint venture or similar joint enterprise or
undertaking with the Company or any affiliate thereof. The aggregate value of
all such cash, securities and other property shall be the aggregate fair market
value thereof as determined by Catalyst and the Company, or by an
CATALYST FINANCIAL CORP.
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independent appraiser jointly selected by Catalyst and the Company, the cost of
which shall be borne entirely by the Company.
5. Representations of the Company. The Company hereby represents and
warrants that any and all information supplied hereunder to Catalyst in
connection with any and all services to be performed hereunder by Catalyst for
and on behalf of the Company shall be true, complete and correct as of the date
of such dissemination and shall not fail to state a material fact necessary to
make any of such information not misleading. The Company hereby acknowledges
that the ability of Catalyst to adequately provide financial consulting services
hereunder is dependent upon the prompt dissemination of accurate, correct and
complete information to Catalyst. The Company further represents and warrants
hereunder that this Agreement and the transactions contemplated hereunder have
been duly and validly authorized by all requisite corporate action; that the
Company has the full right, power and capacity to execute, deliver and perform
its obligations hereunder; and that this Agreement, upon execution and delivery
of the same by the Company, will represent the valid and binding obligation of
the Company enforceable in accordance with its terms. The representations and
warranties set forth herein shall survive the termination of this Agreement.
6. Indemnification. See Exhibit A attached hereto.
7. Confidentiality. See Exhibit A attached hereto.
8. Independent Contractor. See Exhibit A attached hereto.
9. Amendment. No modification, waiver, amendment, discharge or change
of this Agreement shall be valid unless the same is evidenced by a written
instrument, executed by the party against which such modification, waiver,
amendment, discharge, or change is sought.
10. Notices. All notices, demands or other communications given
hereunder shall be in writing and shall be deemed to have been duly given when
delivered in person or transmitted by facsimile transmission or on the third
calendar day after being mailed by registered or certified mail, return receipt
requested, postage prepaid, to the addresses herein above first mentioned or to
such other address as any party hereto shall designate to the other for such
purpose in the manner hereinafter set forth.
11. Entire Agreement. This Agreement contains all of the understandings
and agreements of the parties with respect to the subject matter discussed
herein. All prior agreements, whether written or oral, are merged herein and
shall be of no force or effect.
12. Severability. The invalidity, illegality or unenforceability of any
provision or provisions of this Agreement will not affect any other provision of
this Agreement, which will remain in full force and effect, nor will the
invalidity, illegality or unenforceability of a portion of any provision of this
Agreement affect the balance of such provision. In the event that any one or
more of the provisions contained in this Agreement or any portion thereof shall
for any reason be held to be invalid, illegal or unenforceable in any respect,
this Agreement shall be reformed,
CATALYST FINANCIAL CORP.
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construed and enforced as if such invalid, illegal or unenforceable provision
had never been contained herein.
13. Construction and Enforcement. This Agreement shall be construed in
accordance with the laws of the State of Florida, without application of the
principles of conflicts of laws. If it becomes necessary for any party to
institute legal action to enforce the terms and conditions of this Agreement,
the successful party will be awarded reasonable attorneys' fees at all trial and
appellate levels, expenses and costs.
14. Binding Nature. The terms and provisions of this Agreement shall be
binding upon and inure to the benefit of the parties, and their respective
successors and assigns.
15. Counterparts. This Agreement may be executed in any number of
counterparts, including facsimile signatures which shall be deemed as original
signatures. All executed counter parts shall constitute one Agreement,
notwithstanding that all signatories are not signatories to the original or the
same counterpart.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
▇▇▇▇▇▇ INTERNATIONAL LTD., an
Ontario, Canada corporation
By:
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▇▇▇▇▇ ▇▇▇▇▇▇, President
CATALYST FINANCIAL CORP., a Florida
corporation
By:
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President
CATALYST FINANCIAL CORP.
EXHIBIT A
Indemnification; Confidentiality; and Independent Contractor Status
1. (a) The Company hereby agrees to indemnify, defend and hold harmless
Catalyst, its officers, directors, principals, employees, affiliates, and
shareholders, and their successors and assigns from and against any and all
claims, damages, losses, liability, deficiencies, actions, suits, proceedings,
costs or legal expenses (collectively the "Losses") arising out of or resulting
from: (i) any breach of a representation, or warranty by the Company contained
in the attached Agreement; or (ii) any activities or services performed
hereunder by Catalyst, unless such Losses were the result of the gross
negligence, intentional misconduct or gross misconduct of Catalyst or were the
result of any information supplied by Catalyst; or (iii) any and all costs and
expenses (including reasonable attorneys' and paralegals' fees) related to the
foregoing, and as more fully described below.
(b) If Catalyst receives written notice of the commencement of any
legal action, suit or proceeding with respect to which the Company is or may be
obligated to provide indemnification pursuant to this Paragraph, Catalyst shall,
within thirty (30) days of the receipt of such written notice, give the Company
written notice thereof (a "Claim Notice"). Failure to give such Claim Notice
within such thirty (30) day period shall not constitute a waiver by Catalyst of
its right to indemnity hereunder with respect to such action, suit or
proceeding, unless the defense thereof is prejudiced thereby. Upon receipt by
the Company of a Claim Notice from Catalyst with respect to any claim for
indemnification which is based upon a claim made by a third party ("Third Party
Claim"), the Company may assume the defense of the Third Party Claim with
counsel of its own choosing, as described below. Catalyst shall cooperate in the
defense of the Third Party Claim and shall furnish such records, information and
testimony and attend all such conferences, discovery proceedings, hearings,
trial and appeals as may be reasonably required in connection therewith.
Catalyst shall have the right to employ its own counsel in any such action, but
the fees and expenses of such counsel shall be at the expense of Catalyst unless
the Company shall not have with reasonable promptness employed counsel to assume
the defense of the Third Party Claim, in which event such fees and expenses
shall be borne solely by the Company. The Company shall not satisfy or settle
any Third Party Claim for which indemnification has been sought and is available
hereunder, without the prior written consent of Catalyst, which consent shall
not be unreasonably withheld or delayed and which shall not be required if
Catalyst is granted a release in connection therewith. If the Company shall fail
with reasonable promptness to defend such Third Party Claim, Catalyst may
defend, satisfy or settle the Third Party Claim at the expense of the Company
(but subject to its consent which shall not be unreasonably withheld) and the
Company shall pay to Catalyst the amount of any such Loss within ten (10) days
after written demand therefor. The indemnification provisions hereunder shall
survive the termination of the attached Agreement.
2. Catalyst agrees that all non-public information pertaining to the
prior, current or contemplated business of the Company is a valuable and
confidential asset of the Company. Such information shall include, without
limitation, information relating to products, customer lists, patents,
trademarks, trade secrets, financing techniques and sources and such financial
statements of the Company as are not available to the public. Catalyst, its
officers, directors,
CATALYST FINANCIAL CORP.
employees, agents and shareholders shall hold all such information in trust and
confidence for the Company and shall not use such information for any purpose
other than the discharge of Catalyst's duties under the attached Agreement or
disclose any such information other than as expressly authorized by the Company,
and shall be liable for damages incurred by the Company as a result of the
unauthorized use or disclosure of such information by Catalyst, its officers,
directors, employees, agents or shareholders for any purpose, except (i) where
such information is publicly available or becomes publicly available other than
through or as a result of a breach of this Section 2 of Exhibit A or the
attached Agreement, or (ii) where such information is subsequently lawfully
obtained by Catalyst from a third party or parties, or (iii) if such information
is known to Catalyst prior to the execution of the attached Agreement, or (iv)
where Catalyst is required to convey by law. The terms of this Section 2 of
Exhibit A shall survive the termination of the attached Agreement.
3. It is expressly understood and agreed that Catalyst shall, at all
times, act as an independent contractor with respect to the Company and not as
an employee or agent of the Company, and nothing contained in the attached
Agreement shall be construed to create a joint venture, partnership, association
or other affiliation, or like relationship, between the parties. It is
specifically agreed that the relationship is and shall remain that of
independent parties to a contractual relationship and that Catalyst shall have
no right to bind the Company in any manner. In no event shall either party be
liable for the debts or obligations of the other except as otherwise
specifically provided in the attached Agreement.
CATALYST FINANCIAL CORP.