EXHIBIT 4.1
ADVISORY AGREEMENT
Agreement (the "Agreement") dated as of June 25, 2004 by and among Scores
Holding Company Inc. (the "Company") and ▇▇▇▇▇ ▇▇▇▇▇▇ (the "Advisor").
WITNESSETH:
WHEREAS, the Company and the Advisor entered into an Agreement dated
February 27, 2004 that provided for compensation to the Advisor for the ninety
(90) days prior to the date of that Agreement; and
WHEREAS, the Company and the Advisor entered into an Agreement dated March
19, 2004 that provided for further compensation to the Advisor; and
WHEREAS, the Company desires to compensate the Advisor for further
performance and the Advisor desires to be compensated by the Company pursuant to
the terms and conditions hereinafter set forth:
NOW, THEREFORE, in consideration of the foregoing and the mutual promises
and covenants herein contained, it is hereby agreed as follows:
SECTION 1. Retention. (a) The Company hereby retains the Advisor on a
non-exclusive basis to perform the services set forth in paragraph (b) below
during the one (1) year period following execution of this Agreement (the
"Term"), commencing on the date hereof, and the Advisor hereby accepts such
retention and shall perform for the Company the duties described herein,
faithfully and to the best of its ability. During the Term, the Advisor shall
report directly to the President of the Company or such other senior officer of
the Company as shall be designated by the President of the Company.
(b) The Advisor shall serve as a business advisor to the Company and
render such advice and services to the Company as may be reasonably requested by
the Company including, without limitation, strategic planning, merger and
acquisition possibilities and business development activities including, without
limitation, the following:
(i) study and review of the business, operations, and historical
financial performance of the Company (based upon management's forecast of
financial performance) so as to enable the Advisor to provide advice to the
Company;
(ii) assist the Company in attempting to formulate the best strategy
to meet the Company's working capital and capital resource needs;
(iii) assist in the formulation of the terms and structure of any
reasonable proposed business combination transaction involving the Company;
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(iv) assist in the presentation to the Board of Directors of the
Company of any proposed transaction.
SECTION 2. Compensation. (a) The Company shall pay to the Advisor a fee of
Nine Thousand Seven Hundred Fifty Dollars ($9,750.00) payable in 100,000 shares
of the Company's common stock (the "Common Stock") at a price that is 65% of the
stock's closing price on the date of this Agreement ($0.0975 per share based on
Closing price of $0.15), and which shares shall be registered with the
Securities & Exchange Commission on Form S-8. The fee is in consideration of
performance under this Agreement. The Company and the Advisor agree to meet from
time-to-time to discuss further compensation based on performance.
SECTION 3. Confidential Information. The Advisor agrees that during and
after the Term, it will keep in strictest confidence, and will not disclose or
make accessible to any other person without the written consent of the Company,
the Company's products, services and technology, both current and under
development, promotion and marketing programs, lists, trade secrets and other
confidential and proprietary business information of the Company or any of its
clients and third parties including, without limitation, Proprietary Information
(as defined in Section 7) (all of the foregoing is referred to herein as the
"Confidential Information"). The Advisor agrees (a) not to use any such
Confidential Information for himself or others; and (b) not to take any such
material or reproductions thereof from the Company's facilities at any time
during the Term except, in each case, as required in connection with the
Advisor's duties hereunder.
Notwithstanding the foregoing, the parties agree that the Advisor is free
to use (a) information in the public domain not as a result of a breach of this
Agreement, (b) information lawfully received form a third party who had the
right to disclose such information and (c) the Advisor's own independent skill,
knowledge, know-how and experience to whatever extent and in whatever way he
wishes, in each case consistent with his obligations as the Advisor and that, at
all times, the Advisor is free to conduct any research relating to the Company's
business.
SECTION 4. Ownership of Proprietary Information. The Advisor agrees that
all information that has been created, discovered or developed by the Company,
its subsidiaries, affiliates, licensors, licensees, successors or assigns
(collectively, the "Affiliates") (including, without limitation, information
relating to the development of the Company's business created, discovered,
developed by the Company or any of its affiliates during the Term, and
information relating to the Company's customers, suppliers, advisors, and
licensees) and/or in which property rights have been assigned or otherwise
conveyed to the Company or the Affiliates, shall be the sole property of the
Company or the Affiliates, as applicable, and the Company or the Affiliates, as
the case may be, shall be the sole owner of all patents, copyrights and other
rights in connection therewith, including without limitation the right to make
application for statutory protection. All the aforementioned information is
hereinafter called "Proprietary Information." By way of illustration, but not
limitation, Proprietary Information includes trade secrets, processes,
discoveries, structures, inventions, designs, ideas, works of authorship,
copyrightable works, trademarks, copyrights, formulas, improvements, inventions,
product concepts, techniques, marketing plans, merger and acquisition targets,
strategies, forecasts, blueprints, sketches, records, notes, devices, drawings,
customer lists, patent applications, continuation applications,
continuation-in-part applications, file wrapper continuation applications and
divisional applications and information about the Company's Affiliates, its
employees and/or advisors (including, without limitation, the compensation, job
responsibility and job performance of such employees and/or advisors).
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All original content, proprietary information, trademarks, copyrights,
patents or other intellectual property created by the Advisor that does not
include any specific information relative to the Company's proprietary
information, shall be the sole and exclusive property of the Advisor.
SECTION 5. Indemnification. The Company represents that all materials
provided or to be provided to the Advisor or any third party regarding the
Company's financial affairs or operations are and shall be truthful and accurate
and in compliance with any and all applicable federal and state securities laws.
The Company agrees to indemnify and hold harmless the Advisor and its advisors,
professionals and affiliates, the respective directors, officers, partners,
members, managers, agents and employees and each other person, if any,
controlling the Advisor or any of its affiliates to the full extent lawful, from
and against all losses, claims, damages, liabilities and expenses incurred by
them (including reasonable attorneys' fees and disbursements) that result from
actions taken or omitted to be taken (including any untrue statements made or
any statement omitted to be made) by the Company, its agents or employees which
relate to the scope of this Agreement and the performance of the services by the
Advisor contemplated hereunder. The Advisor will jointly and severally indemnify
and hold harmless the Company and the respective directors, officers, agents,
affiliates and employees of the Company from and against all losses, claims
damages, liabilities and expenses that result from bad faith, gross negligence
or unauthorized representations of the Advisor. Each person or entity seeking
indemnification hereunder shall promptly notify the Company, or the Advisor, as
applicable, of any loss, claim, damage or expense for which the Company or the
Advisor, as applicable, may become liable pursuant to this Section 8. No party
shall pay, settle or acknowledge liability under any such claim without consent
of the party liable for indemnification, and shall permit the Company or the
Advisor, as applicable, a reasonable opportunity to cure any underlying problem
or to mitigate actual or potential damages. The scope of this indemnification
between the Advisor and the Company shall be limited to, and pertain only to
certain transactions contemplated or entered into pursuant to this Agreement.
The Company or the Advisor, as applicable, shall have the opportunity to
defend any claim for which it may be liable hereunder, provided it notifies the
party claiming the right to indemnification in writing within fifteen (15) days
of notice of the claim.
The rights stated pursuant to this Section 8 shall be in addition to any
rights that the Advisor, the Company, or any other person entitled to
indemnification may have in common law or otherwise, including, but not limited
to, any right to contribution.
SECTION 6. Notices. Any notice or other communication under this Agreement
shall be in writing and shall be deemed to have been duly given: (a) upon
facsimile transmission (with written transmission confirmation report) at the
number designated below; (b) when delivered personally against receipt
therefore; (c) one day after being sent by Federal Express or similar overnight
delivery; or (d) five (5) business days after being mailed registered or
certified mail, postage prepaid. The addresses for such communications shall be
as set forth below or to such other address as a party shall give by notice
hereunder to the other party to this Agreement.
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If to the Company: Scores Holding Company Inc.
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Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Advisor: ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
#▇▇▇
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(▇▇▇) ▇▇▇-▇▇▇▇
SECTION 7. Status of Advisor. The Advisor shall be deemed to be an
independent contractor and, except as expressly provided or authorized in this
Agreement, shall have no authority to act for on behalf of or represent the
Company. This Agreement does not create a partnership or joint venture.
SECTION 8. Other Activities of Advisor. The Company recognizes that the
Advisor now renders and may continue to render financial consulting and other
investment banking services to other companies, which may or may not conduct
business and activities similar to those of the Company. The Advisor shall not
be required to devote its full time and attention to the performance of its
duties under this Agreement, but shall devote only so much of its time and
attention as it deems reasonable or necessary for such purposes.
SECTION 9. Successors and Assigns. 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. This Agreement and
any of the rights, interests or obligations hereunder may be assigned by the
Advisor without the prior written consent of the Company. This Agreement and any
of the rights, interests or obligations hereunder may not be assigned by the
Company without the prior written consent of the Advisor, which consent shall
not be unreasonably withheld.
SECTION 10. Severability of Provisions. If any provision of this Agreement
shall be declared by a court of competent jurisdiction to be invalid, illegal or
incapable of being enforced in whole or in part, the remaining conditions and
provisions or portions thereof shall nevertheless remain in full force and
effect and enforceable to the extent they are valid, legal and enforceable, and
no provision shall be deemed dependent upon any other covenant or provision
unless so expressed herein.
SECTION 11. Entire Agreement; Modification. This Agreement and the
schedules hereto contains the entire agreement of the parties relating to the
subject matter hereof, and the parties hereto and thereto have made no
agreements, representations or warranties relating to the subject matter of this
Agreement which are not set forth herein. No amendment or modification of this
Agreement shall be valid unless made in writing and signed by each of the
parties hereto.
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SECTION 12. Non-Waiver. The failure of any party to insist upon the strict
performance of any of the terms, conditions and provisions of this Agreement
shall not be construed as a waiver or relinquishment of future compliance
therewith, and said terms, conditions and provisions shall remain in full force
and effect. No waiver of any term or condition of this Agreement on the part of
any party shall be effective for any purpose whatsoever unless such waiver is in
writing and signed by such party.
SECTION 13. Governing Law. The parties hereto acknowledge that the
transactions contemplated by this Agreement bear a reasonable relation to the
state of New York. This Agreement shall be governed by, and construed and
interpreted in accordance with, the internal laws of the state of New York
without regard to such state's principles of conflicts of laws. The parties
irrevocably and unconditionally agree that the exclusive place of jurisdiction
for any action, suit or proceeding ("Actions") relating to this Agreement shall
be in the state and/or federal courts situate in the county and state of New
York. Each party irrevocably and unconditionally waives any objection it may
have to the venue of any Action brought in such courts or to the convenience of
the forum. Final judgment in any such Action shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment, a certified or true
copy of which shall be conclusive evidence of the fact and the amount of any
indebtedness or liability of any party therein described. Service of process in
any Action by any party may be made by serving a copy of the summons and
complaint, in addition to any other relevant documents, by commercial overnight
courier to any other party at their address set forth in this Agreement.
SECTION 14. Headings. The headings of the Sections are inserted for
convenience of reference only and shall not affect any interpretation of this
Agreement.
SECTION 15. Counterparts. This Agreement may be executed in counterpart
signatures, each of which shall be deemed an original, but all of which, when
taken together, shall constitute one and the same instrument, it being
understood that both parties need not sign the same counterpart. In the event
that any signature is delivered by facsimile transmission, such signature shall
create a valid and binding obligation of the party executing (or on whose behalf
such signature is executed) the same with the same force and effect as if such
facsimile signature page were an original thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first written above.
SCORES HOLDING COMPANY INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, President
▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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