RETENTION OF SERVICES AGREEMENT

1.  

2.  

In order to grow, the Company has developed a strategy to acquire other companies as going concerns that are engaged in activities, products and services closely associated with the Business.

3.  

(a)  

(b)  

The Manager agrees to use his best efforts to provide the services set forth in Section 2.

(c)  

(a)  

The Manager shall recommend to the Company certain personnel to engage for the purpose of assisting the Manager in performing the day-to-day accounting, financial reporting including those required by the rules of the Securities and Exchange Commission, legal disclosures, the preparation of analyses, and other administrative functions so as to ensure that internal controls and procedures are in place and maintained to provide timely financial data that is produced accurately and in accordance with generally accepted accounting principles.

(b)  

The Manager shall assist the CEO by identifying acquisition candidates consistent with the Company’s strategic plan and within its financial resources, and in so doing, the Manager shall negotiate and structure transactions for consideration and approval of the Company’s CEO and its Board.

(c)  

Subject to the terms of this Agreement, the Manager, on behalf of the Company, shall perform and render management, investment, administrative, consulting and other services to the Company as may be required by the Company to properly conduct its business, including, without limitation, the following:

(i)  

Managing the financial operations of the Company, its accounting, and the preparation of its financial statements;

(ii)  

providing general business advice, including recommendations as to, and identification of, potential investments and acquisitions;

(iii)  

conducting due diligence in connection with potential investments and acquisitions;

(iv)  

structuring and negotiating transactions;

(v)  

assist the Company’s CEO in identifying, structuring, negotiating, obtaining bank, institutional and other sources of financing necessary or appropriate in connection with any proposed acquisition or investment;

(vi)  

supervising the preparation and review of all documents required to complete any transaction involving investments, including, where appropriate, any acquisition agreements, financing documents, and other documents in connection with such transaction;

(vii)  

monitoring the performance of the Company’s assets and subsisiaries;

(viii)  

communicating with the Company’s CEO, subsidiary(ies) management, and the Company’s Board;

(ix)  

maintaining the books and records of the Company, and managing other administrative matters of the company;

(x)  

managing the Company’s receivables and payables including assisting the CEO in determining the amounts available for payments, and disbursing such payments with respect to operating expenses, administrative costs, legal fees, and other expenses of the Company; and

(xi)  

providing such other assistance to the Company’s CEO, its Board of Directors, the Company’s counsel and auditors as generally may be required of the Chief Financial Officer of the Company.

(d)  

The Manager shall perform his obligations under this Agreement in good faith and in a diligent and timely manner. In addition to his services, the Manager shall, to the extent that he determines that it is necessary or advisable to perform the services for the Company which are required hereunder, seek the CEO’s approval and then arrange for and coordinate the services of other professionals, experts and consultants (collectively, “Third Parties”), and the Manager shall cause the Company to compensate such Third Parties for such services.

(e)  

The Manager may enter into contracts and transactions on behalf of the Company, provided that the terms of any such contract or transaction are prior approved by the Company’s CEO.

(f)  

Notwithstanding the services provided by the Manager as the Company’s Chief Financial Officer, the Manager shall be deemed to be an independent contractor and not an employee of the Company, nor an officer or legal representative of the Company and, unless otherwise expressly authorized by the Company’s CEO, the Manager shall not be authorized to act in the name of, or bind the Company.

(g)  

(h)  

The Manager shall have unfettered access to books and records of the Company, as necessary to enable him to fulfill his obligations hereunder as the Company’s Chief Financial Officer.

(a)  

The Company shall, to the maximum extent permitted by applicable law, indemnify, defend and hold harmless the Manager, and the Company shall release the Manager, to the fullest extent permitted by law, from and against any and all damages, including, without limitation, damages incurred which arise out of, relate to or are in connection with this Agreement or the management or conduct of the business or affairs of the Company or any Company subsidiary in which the Company has a direct or indirect interest as such management or conduct of business or affairs relates directly or indirectly to the Company (including, without limitation, actions taken or not taken directly or indirectly on behalf of the Company by the Manager, provided that the act or failure to act giving rise to such damages was taken in good faith by the Manager and except for any such damages that are found by a court of competent jurisdiction to have resulted primarily from any act or omission which constituted gross negligence, intentional misconduct, an intentional breach of this Agreement or a knowing violation of law by the Manager. In the event of any claim as to which the Manager is entitled to indemnification under this Section, the Company may, at the discretion of the Company’s CEO, elect to engage counsel on behalf of the Manager to defend such claim.

(b)  

(a)  

It is understood and agreed that the Manager will serve the Company to the best of his ability in a diligent and professional manner; provided, however, that Manager shall not be required to render such services on a full-time basis. The Manager will devote such attention and energies to the performance of the services as Manager as are necessary to discharge his responsibilities to the Company.  This Agreement and the duties of the Manager hereunder shall not preclude the Manager from providing services to any other entity, be employed by another company, serve on another company’s Board of Managers, Board of Directors or Advisory Board, engage in any other business activity (whether or not pursued for pecuniary advantage), or engage in passive investment and in community, charitable, and social activities. During the term of this Agreement, the Manager shall be permitted to engage in other business activities or endeavors, or serve as a manager, officer, advisor, director or trustee of another corporation or entity unrelated to the business of the Company; provided that such other activities are not to be performed for entities which in the reasonable judgment of the Manager are in direct competition with the Company, and the time devoted by the Manager to such other activities does not conflict with or materially interfere with the Manager’s performance of his duties to the Company hereunder. The ownership of an equity interest in an entity, by itself, shall not constitute a violation of this duty. The Company shall not have any rights or obligations by virtue of this Agreement in and to such independent ventures and activities of the Manager or the income or profits that are derived therefrom. Specifically, the Manager shall not engage in any activity that is in direct competition with the Company or serve in any capacity (including, but not limited to, as an employee, consultant, advisor or director) in any the Company or entity that competes directly with the Company, as reasonably determined by the Company’s CEO.

(b)  

The Manager represents that, to the best of his knowledge, he has no outstanding agreement or obligation that is in conflict with any of the provisions of this Agreement, and the Manager agrees to use his best efforts to avoid or minimize any such conflict and agrees not to enter into any agreement or obligation that could create such a conflict, without the approval of the Company’s CEO. If, at any time, the Manager is required to make any disclosure or take any action that may conflict with any of the provisions of this Agreement, the Manager will promptly notify the Company’s CEO of such obligation, prior to making such disclosure or taking such action.

(c)  

The Manager will not engage in any activity that creates an actual conflict of interest with the Company, regardless of whether such activity is prohibited by the Company’s conflict of interest guidelines, policies, or this Agreement, and the Manager agrees to notify the Company’s CEO before engaging in any activity that creates a potential conflict of interest with the Company.

(a)  

This Agreement shall remain in effect for a period of one (1) year from the Effective Date, and it shall be automatically renewed thereafter for one or more additional one-year terms until terminated either (i) by the Manager or the Company by giving written notice to the other party at least thirty (30) days’ prior to the end of its term or prior to any renewal date; or (ii) pursuant to the terms of Section 5(b).

(b)  

 

(c)  

The Company shall not be entitled to terminate the Manager for Cause pursuant to Section 5(b)(ii) or Section 5(b)(iv) unless the Company provides to the Manager written notice stating in reasonable detail the basis for termination and allowing a 10-day opportunity for the Manager to cure.

(d)  

Upon termination of this Agreement, the Manager agrees that all Company property, including, without limitation, all equipment, tangible proprietary information, documents, records, notes, contracts, and computer-generated materials provided to or prepared by the Manager, incident to his services hereunder, that are documented to belong to the Company, shall be promptly returned at the request of the Company.

(e)  

Upon termination of this Agreement, the Manager shall be deemed to have resigned from all offices then held with the Company or any of its subsidiaries by virtue of this Agreement. The Manager agrees that following any termination of this Agreement, the Manager shall cooperate with the Company in the winding-up or transferring to other Company employees or retained professionals any pending work and shall also cooperate with the Company (to the extent allowed by law, and at the Company’s expense) in the defense of any action brought by any third party against the Company that relates to the Manager’s services.

(f)  

In the event of a legal merger of the Company with another entity or a “change in control” of the Company during the term of this Agreement, the then surviving entity or, in the event of a change in control, the Company shall agree in writing to the Manager that it shall assume the responsibilities of the Company hereunder or the Agreement shall be terminated as of the date of the merger or the “change in control” under which event the termination fee due the Manager shall be three times the then remaining fees due under this Agreement to the end of its term, which termination fee shall be immediately due and payable in a lump sum payment to the Manager.

(a)  

Upon the Company attaining $5 million of gross revenues, this Agreement may be terminated by the Manager and then the Company’s CEO and the Manager will negotiate in good faith the terms of an Employment Agreement under which the Manager shall thereafter devote full time to his responsibilities to the Company and be compensated with salary, benefits, stock options and employee benefits consistent with a Chief Financial Officer of a publicly-traded company having revenues of $5 million.

(b)  

Notwithstanding the provisions of Section 6(a), the Manager shall have the right of first refusal to the full-time position as the Company’s Chief Financial Officer if during the term of this Agreement, the Company’s CEO or its Board has decided that a full-time employee is needed for that position rather than continuing this Agreement with the Manager as a part-time retained professional, and if so decided, the salary, benefits, stock options and employee benefits of the full-time position shall be set by the Board consistent with those of a Chief Financial Officer of a publicly-traded company having revenues of $5 million.

(a)  

The Company hereby agrees to pay the Manager a fee to serve as its part-time Chief Financial Officer, payable monthly in arrears, equal to Two Thousand Five Hundred and No/100ths Dollars ($2,500.00) per month.  The first such payment shall be due on September 30, 2012 and thereafter on the last day of each month during the term of this Agreement.

(b)  

During the term of this Agreement, the Manager may be granted (i) additional fees to recognize the Manager’s finding appropriate acquisitions for the Company, or for his services and extraordinary efforts to negotiate, structure and close acquisitions for the Company; and/or (ii) options to acquire the Company’s common stock or other equity rights, as determined by the Company’s Board of Directors or its Compensation Committee, in its sole discretion. In the event (i) of a merger, change in control or sale of the Company; or (ii) this Agreement is terminated where the Manager has not engaged in conduct which would constitute “cause” for such termination, as determined by a majority vote of the Company’s Board of Directors, any such options shall become immediately fully vested.

(c)  

As a signing bonus, upon the Company’s execution of this Agreement, the Company shall issue a five-year warrant (in the form attached hereto as Exhibit A) to the Manager that entitles the Manager to subscribe for and purchase from the Company up to One Million Five Hundred Thousand (1,500,000) shares of the company’s common stock at an exercise price of No and 10/100ths Dollars ($0.10) per share (with the right to a cashless exercise) exercisable at any time, in part or in whole, provided that at the time of an exercise, the Manager is then retained or otherwise associated with the Company. If during the term of the Warrant, the Manager’s retention by, association with, or employment by the Company is terminated, then the Manager must exercise within thirty (30) days any remaining shares available under the warrant, otherwise any un-exercised portion of the Warrant shall be forfeited at the end of the thirty-day period following the date of such termination. A minimum of three (3) months of services must be rendered for warrant to be valid.

(a)  

(b)  

The Manager’s travel to the Company’s New York City headquarters office shall be required at least once every two weeks; otherwise, the Manager may attempt to work remotely in his Shelton, Connecticut personal office as long as he is able to properly and effectively discharge his duties to the Company.

(a)  

Notices.   Any notice or other communication to be given hereunder shall be in writing and shall be mailed or telecopied to such party at the address or number set forth below:

 

(b)  

(c)  

(d)  

(e)  

Severability.  In the event that any provision of this Agreement is held invalid or unenforceable for any reason by a court of competent jurisdiction, such provision or part thereof shall be considered separate from the remaining provisions of this agreement which shall remain in full force and effect.

(f)  

Successors and Assigns.  This Agreement is binding upon the parties and their heirs, personal representatives, successors and assigns, as the case may be.

(g)  

(h)  

Counterparts.  This Agreement may be executed in counterparts, which when taken together shall nonetheless be one and the same agreement.

(i)  

Dispute Resolution - Arbitration.   Any dispute, controversy or claim arising out of or relating to this Agreement, or any breach or alleged breach hereof shall, upon the request of either party, be submitted to, and settled by, arbitration, before a single arbitrator in New York City, New York.  The arbitration shall proceed pursuant to and in accordance with the provisions of this Section and otherwise pursuant to and in accordance with the New York Arbitration Rules then in effect of the American Arbitration Association (or at any other place or under any other form of arbitration mutually acceptable to the parties).  The parties shall agree on a single arbitrator within thirty (30) days after notice from either party seeking or demanding arbitration; provided, however, that if they do not so agree then the arbitrator shall be either the one proposed by the Company or the one proposed by the Company, to be determined by a toss of the coin (if only one party proposes an arbitrator then the arbitrator shall be the one so proposed).  The arbitrator shall base the award on applicable law and judicial precedent and, unless both parties agree otherwise, shall include in such award the findings of fact and conclusions of law upon which the award is based.  Any award rendered shall be final and conclusive upon the parties and a judgment thereon may be entered in the appropriate court of any forum, state or federal, having jurisdiction. The expenses of the arbitration shall be borne equally by the parties to the arbitration or as otherwise determined by the arbitrator to be more just and equitable under all the circumstances.  Each party shall pay for and bear the cost of its own experts, evidence and counsel’s fees except to the extent, if at all, the arbitrator determines that it is more just and equitable under all the facts and circumstances that one party reimburse the other, in whole or in part, for the cost of the other party's experts, evidence and/or counsel fees; provided, however that if either party fails to proceed with the arbitration as provided herein or unsuccessfully seeks to stay such arbitration, or fails to comply with any arbitration award, the other party shall be entitled to be awarded costs, including reasonable attorneys’ fees, paid or incurred by such other party in successfully compelling such arbitration and/or successfully defending or enforcing the award.  The parties shall use all reasonable efforts to ensure that the arbitration is completed as promptly as reasonably possible, and preferably within not more than ninety (90) days after either party’s request for arbitration hereunder.