EXHIBIT 10.24
NATIONAL FINANCIAL COMMUNICATIONS CORP.
CONSULTING AGREEMENT
AGREEMENT made as of the 15th day of September, 2001 by and between Can-Cal
Resources Ltd., maintaining its principal offices at 8221 Cretan Blue Lane, Las
Vegas, NV 89128 (hereinafter referred to as "Client") and National Financial
Communications Corp. DBA/ OTC Financial Network, a Commonwealth of Massachusetts
corporation maintaining its principal offices at 300 Chestnut St, Suite 200,
Needham, MA 02492 (hereinafter referred to as the "Company").
W I T N E S S E T H :
WHEREAS, Company is engaged in the business of providing and rendering
public relations and communications services and has knowledge, expertise and
personnel to render the requisite services to Client; and
WHEREAS, Client is desirous of retaining Company for the purpose of
obtaining public relations and corporate communications services so as to
better, more fully and more effectively deal and communicate with its
shareholders and the investment banking community.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, it is agreed as follows:
I. Engagement of Company. Client herewith engages Company and Company
agrees to render to Client public relations, communications, advisory and
consulting services.
A. The consulting services to be provided by the Company shall include, but
are not limited to, the development, implementation and maintenance of an
ongoing program to increase the investment community's awareness of Client's
activities and to stimulate the investment community's interest in Client.
Client acknowledges that Company's ability to relate information regarding
Client's activities is directly related to the information provided by Client to
the Company.
B. Client acknowledges that Company will devote such time as is reasonably
necessary to perform the services for Client, having due regard for Company's
commitments and obligations to other businesses for which it performs consulting
services.
II. Compensation and Expense Reimbursement.
A. Client will pay the Company, as compensation for the services provided
for in this Agreement and as reimbursement for expenses incurred by Company on
Client's behalf, in the manner set forth in Schedule A annexed to this Agreement
which Schedule is incorporated herein by reference.
B. In addition to the compensation and expense reimbursement referred to in
Section 2(A) above, Company shall be entitled to receive from Client a
"Transaction Fee", as a result of any Transaction (as described below) between
Client and any other company, entity, person, group or persons or other party
which is introduced to, or put in contact with, Client by Company, or by which
Client has been introduced to, or has been put in contact with, by Company. A
"Transaction" shall mean merger, sale of stock, sale of
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assets, consolidation or other similar transaction or series or combination of
transactions whereby Client or such other party transfer to the other, or both
transfer to a third entity or person, stock, assets, or any interestin its
business in exchange for stock, assets, securities, cash or other valuable
property or rights, or wherein they make a contribution of capital or services
to a joint venture, commonly owned enterprise or business opportunity with the
other for purposes of future business operations and opportunities. To be a
Transaction covered by this section, the transaction must occur during the term
of this Agreement or the one year period following the expiration of this
Agreement.
The calculation of a Transaction Fee shall be based upon the total value of the
consideration, securities, property, business, assets or other value given,
paid, transferred or contributed by, or to, the Client and shall equal 5% of the
dollar value of the Transaction. Such fee shall be paid by certified funds at
the closing of the Transaction.
Term and Termination. This Agreement shall be for a period of one year
commencing September 15, 2001 and terminating September 14, 2002. If the Client
does not cancel the contract during the term, the contract will be automatically
extended for an additional three months. Either party hereto shall have the
right to terminate this Agreement upon 10 days prior written notice to the other
party after the first 90 days.
Treatment of Confidential Information. Company shall not disclose, without
the consent of Client, any financial and business information concerning the
business, affairs, plans and programs of Client which are delivered by Client to
Company in connection with Company's services hereunder, provided such
information is plainly and prominently marked in writing by Client as being
confidential (the "Confidential Information"). The Company will not be bound by
the foregoing limitation in the event (i) the Confidential Information is
otherwise disseminated and becomes public information or (ii) the Company is
required to disclose the Confidential Informational pursuant to a subpoena or
other judicial order.
Representation by Company of other clients. Client acknowledges and
consents to Company rendering public relations, consulting and/or communications
services to other clients of the Company engaged in the same or similar business
as that of Client.
Indemnification by Client as to Information Provided to Company. Client
acknowledges that Company, in the performance of its duties, will be required to
rely upon the accuracy and completeness of information supplied to it by
Client's officers, directors, agents and/or employees. Client agrees to
indemnify, hold harmless and defend Company, its officers, agents and/or
employees from any proceeding or suit which arises out of or is due to the
inaccuracy or incompleteness of any material or information supplied by Client
to Company.
Independent Contractor. It is expressly agreed that Company is acting as an
independent contractor in performing its services hereunder. Client shall carry
no workers compensation insurance or any health or accident insurance on Company
or consultant's employees. Client shall not pay any contributions to social
security, unemployment insurance, Federal or state withholding taxes nor provide
any other contributions or benefits which might be customary in an
employer-employee relationship.
Non-Assignment. This Agreement shall not be assigned by either party
without the written consent of the other party.
Notices. Any notice to be given by either party to the other hereunder
shall be sufficient if in writing and sent by registered or certified mail,
return receipt requested, addressed to such party at the address
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specified on the first page of this Agreement or such other address as either
party may have given to the other in writing.
Entire Agreement. The within agreement contains the entire agreement and
understanding between the parties and supersedes all prior negotiations,
agreements and discussions concerning the subject matter hereof.
Modification and Waiver. This Agreement may not be altered or modified
except by writing signed by each of the respective parties hereof. No breach or
violation of this Agreement shall be waived except in writing executed by the
party granting such waiver.
Law to Govern; Forum for Disputes. This Agreement shall be governed by the laws
of the Commonwealth of Massachusetts without giving effect to the principle of
conflict of laws. Each party acknowledges to the other that courts within the
City of Boston, Massachusetts shall be the sole and exclusive forum to
adjudicate any disputes arising under this agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first written above.
National Financial Communications Corp.
By: /s/ Geoffrey Eiten
---------------------------------
Geoffrey Eiten, President
Can-Cal Resources Ltd.
By: /s/ Ron Sloan
---------------------------------
Ron Sloan, Authorized Agent
SCHEDULE A-1 PAYMENT FOR SERVICES AND REIMBURSEMENT OF EXPENSES.
SCHEDULE A-2 GRANT OF OPTIONS TO NATIONAL FINANCIAL COMMUNICATIONS IN
ADVANCE OF SERVICES RENDERED (OPTIONAL)
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SCHEDULE A-1
PAYMENT FOR SERVICES
AND REIMBURSEMENT OF EXPENSES
A. For the services to be rendered and performed by Company during the term
of the Agreement, Client shall pay to Company the sum of $5,000 per month
payable in cash and/or shares. Client will add 20% to all fees for paying in
shares rather than cash. If the Client decides to pay for the entire base fee
with 100% shares vs. cash, the Client must also issue three months worth of base
fees at the signing of this agreement in those shares. The amount of shares will
be determined by the bid price at the date of this contract. The Company will
keep an accounting of the sales of stock and deduct those sales from the base
fee per month owed. If those sales exceed the monthly fee, the excess amount
will be credited to the next month's monthly fee. If there are not enough
dollars in shares to cover the $5,000 monthly fee, the Client will either pay
additional shares or cover the deficit or the Client will pay the deficit in
cash for that particular month. Client will initially register 200,000 shares to
cover services and expenses for the term of the contract.
B. Client shall also reimburse Company for all reasonable and necessary
out-of-pocket expenses incurred in the performance of its duties for Client upon
presentation of statements setting forth in reasonable detail the amount of such
expenses. Company shall not incur any expense for any single item in excess of
$250 either verbally or written except upon the prior approval of the Client.
Company agrees that any travel, entertainment or other expense which it may
incur and which may be referable to more than one of its clients (including
Client) will be prorated among the clients for whom such expense has been
incurred. Shares will be accepted for payment of expenses in the same manner as
the base fee per month in Paragraph A above.
National Financial Communications Corp.
By: /s/ Geoffrey Eiten
---------------------------------
Geoffrey Eiten, President
Can-Cal Resources Ltd.
By: /s/ Ron Sloan
---------------------------------
Ron Sloan, Authorized Agent
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SCHEDULE A-2 (OPTIONAL)
GRANT OF OPTIONS TO NATIONAL FINANCIAL COMMUNICATIONS CORP. IN ADVANCE
OF SERVICES RENDERED*
A. Grant of Options and Option Exercise Price. As compensation for the services
to be rendered by Company hereunder, Client herewith issues and grants to
Company stock options (the "Options") to purchase an aggregate of 200,000 shares
of Client's Common Stock at an exercise price of $1.00 per share. The Options
are exercisable upon and subject to the terms and conditions contained herein.
The Options are exercisable during the period commencing on the date hereof and
ending three years subsequent to the termination date of this Agreement.
B. Manner of Exercise. Exercise of any of the Options by Company shall be by
written notice to Client accompanied by Company's certified or bank check for
the purchase price of the shares being purchased. Upon receipt of such notice
and payment, Client shall promptly cause to be issued, without transfer or issue
tax to the option holder or other person entitled to exercise the option, the
number of shares for which the Option has been exercised, registered in the name
of Company. Such shares, when issued, shall be fully paid and non-assessable.
C. Option Shares. Company acknowledges that any shares which it may acquire from
Client pursuant to the exercise of the Options provided for herein will not have
been registered pursuant to the Securities Act of 1933, as amended (the
"Securities Act"), and therefore may not be sold or transferred by Company
except in the event that such shares are the subject of a registration statement
or any future sale or transfer is, in the opinion of counsel for Client, exempt
from such registration provisions. Company acknowledges that any shares which it
may acquire pursuant to the exercise of the Options will be for its own account
and for investment purposes only and not with a view to the resale or
redistribution of same. Company further consents that the following legend be
placed upon all certificates for shares of Common Stock which may be issued to
Company upon the exercise of the Options:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND MAY NOT BE SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE CORPORATION THAT
SUCH REGISTRATION IS NOT REQUIRED."
Company further consents that no stop transfer instructions being placed against
all certificates may not be issued to it upon the exercise of the Options.
(i) If the Client executes a Registration during the term of the contract,
then the Company's shares will be added to this Registration at no cost to the
Company. The Client shall bear all costs and expenses attributable to such
registration, excluding fees and expenses of Company's counsel and any
underwriting or selling commission. Client shall maintain the effectiveness of
such registration throughout the term of this Agreement and for a 120 day period
thereafter.
(ii) Notwithstanding the foregoing, if the Shares issuable upon exercise of
the Options are not otherwise registered under the Securities Act and the Client
shall at any time after the date hereof propose to file a registration statement
under the Securities Act, which registration statement shall include shares of
Common Stock of Client or any selling shareholder, Client shall give written
notice to Company of such proposed registration and will permit Company to
include in such registration all Shares which it has
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acquired as of the date of such notice. The Client shall bear all costs and
expenses attributable to such registration, excluding fees and expenses of
Company's counsel and any underwriting or selling commission.
D. Adjustments in Option Shares.
(i) In the event that Client shall at any time sub-divide its outstanding
shares of Common Stock into a greater number of shares, the Option purchase
price in effect prior to such sub-division shall be proportionately reduced and
the number of shares of Common Stock purchasable shall be proportionately
increased. In case the outstanding shares of Common Stock of Client shall be
combined into a smaller number of shares, the Option purchase price in effect
immediately prior to such combination shall be proportionately increased and the
number of shares of Common Stock purchasable shall be proportionately reduced.
(ii) In case of any reclassification or change of outstanding shares of
Common Stock issuable upon exercise of this Option (other than change in par
value, or from par value to no par value, or from no par value to par value, or
as a result or a subdivision or combination), or in case of any consolidation or
merger of the Client with or into another corporation (other than a merger in
which the Client is the continuing corporation and which does not result in any
reclassification or change of outstanding shares of Common Stock, other than a
change in number of the shares issuable upon exercise of the Option) or in case
of any sale or conveyance to another corporation of the property of the Client
as an entirety or substantially as an entirety, the Holder of this Option shall
have the right thereafter to exercise this Option into the kind and amount of
shares of stock and other securities and property receivable upon such
reclassification, change, consolidation, merger, sale or conveyance by a holder
of the number of shares of Common Stock of the Client for which the Option might
have been exercised immediately prior to such reclassification, change,
consolidation, merger, sale or conveyance. The above provisions shall similarly
apply to successive reclassifications and changes of shares of Common Stock and
to successive consolidations, mergers, sales or conveyances.
(iii) The Company reserves the right to assign these options to a third
party at its own discretion.
National Financial Communications Corp.
By: /s/ Geoffrey Eiten
---------------------------------
Geoffrey Eiten, President
Can-Cal Resources Ltd.
By: /s/ Ron Sloan
---------------------------------
Ron Sloan, Authorized Agent
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*National Financial Communications (NFC) will receive the options in
Schedule A- 2. Fifty percent (50%) of any profits received through the
exercising of options will be credited to the client's account while this
contract is in force. However, the amount of options exercised will be
replaced by the client with the same number of options, at an exercise
price equal to the current market price of the stock at the time of
exercise. If the contract is cancelled by the client, any credit with the
client will become an asset of NFC and any unexercised options remaining
will remain an asset of NFC three years subsequent to the termination of
this agreement.
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