Document:

EXHIBIT 10.1 SERVICES AGREEMENT

 

 Exhibit 10.1
 SERVICES AGREEMENT
 

 

 THIS SERVICES AGREEMENT (this “Agreement”) is made as of July 11, 2011 between Horizon Tower, LLC, a Delaware limited liability company (“Horizon”), and Massive Dynamics, Inc. a Nevada corporation (“Service Provider”).
 

 Recitals:
 

 A.
 Horizon desires to identify, acquire and develop sites for telecommunications towers (“Tower Sites”).
 

 B.
 Service Provider has expertise in identifying, acquiring and developing Tower Sites and desires to perform services related thereto for Horizon.
 

 Agreement:
 

 NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Horizon and Service Provider hereby agree as follows:
 

 1.
 Engagement.  
 Subject to the terms and conditions of this Agreement, Horizon hereby engages Service Provider on an exclusive basis as an independent contractor, and not as an employee, to provide to Horizon the Services (defined below) and Service Provider hereby accepts such engagement.  Service Provider is an independent contractor and not an agent of Horizon and Service Provider shall take any action which would purport to bind Horizon to any agreement.
 

 2.
 Tower Site Development Services.  Service Provider shall provide the following services to Horizon at Service Provider’s sole cost and expense (collectively, the “Development Services”):
 

 (a)
 Site Identification.  Service Provider shall identify possible Tower Sites and provide Horizon with a written report (a “Tower Site Report”) regarding the location and characteristics of each Tower Site identified by Service Provider.  Each Tower Site Report shall be in a form approved by Horizon and shall include, among other things (i) site name designated by Service Provider; (ii) identity of the city and county in which the Tower Site is to be located together with the street address/911 address of the Tower Site, if available, and if not available, other information or documentation that shall permit Horizon to identify the real property on which the Tower Site will be located; (iii) latitude and longitude of the Tower Site; (iv) the proposed height of the tower to be located on the Tower Site; (v) a list of prospective tenants which may have a need or an interest in co-locating, leasing or licensing space on the tower; and (vi) a competitive analysis of other existing or planned tower sites within a three-mile radius around the proposed Tower Site.  Upon Horizon’s review of a Tower Site Report and any 
 

 
 additional information that may be requested by Horizon, Horizon, in its sole discretion, shall provide a written notice to Service Provider authorizing Service Provider to commence with the Due Diligence (defined below) (a “Due Diligence Commencement Notice”) or notifying Service Provider that Horizon does not desire to pursue development of the Tower Site.
 

 (b)
 Due Diligence.  Upon receipt of a Due Diligence Commencement Notice, Service Provider shall conduct customary due diligence for such Tower Site (the “Due Diligence”).  The Due Diligence shall include obtaining lien searches, a title commitment, information regarding tax rates and outstanding taxes, information with respect to local zoning laws applicable to the Tower site, an ALTA land survey, a Phase I environmental study, information from the State Historic Preservation Office (“SHPO”) an analysis of the impact of the National Environmental Policy Act (“NEPA”) with respect to such Tower Site and such other due diligence as may be deemed necessary or desirable by Service Provider or which may be requested by Horizon.  Upon completion of the Due Diligence, Service Provider shall provide Horizon with a written report (the “Due Diligence Report”) in a form approved by Horizon, which attaches all of the Due Diligence materials received by Service Provider and which analyzes the Due Diligence results, identifies possible issues with respect to the Tower Site and provides recommendations as to whether development of the Tower Site should take place.  After Horizon’s review of each Due Diligence Report, Horizon, in its sole discretion, shall notify Service Provider in writing to commence work on the acquisition of the Tower Site (the “Site Acquisition Notice”) or to cease work with respect to the Tower Site.
 

 (c)
 Site Acquisition.  Upon receipt from Horizon of a Site Acquisition Notice, Service Provider shall approach the Tower Site owner (the “Owner”) and negotiate with the Owner the business terms of a long-term, recordable ground lease between Horizon and the Owner (a “Ground Lease”) using Horizon’s approved form of ground lease.  Service Provide shall keep Horizon informed with respect to the negotiations and provide Horizon with all drafts of the Ground Lease for Horizon’s review and approval.  The Ground Lease must include provisions providing for any easements or right-of-ways which may be necessary for Horizon to access the Tower Site.  All Ground Leases are subject to the final review and approval of Horizon, in its sole discretion.  Horizon may, in its sole discretion, determine whether it will enter into a Ground Lease negotiated by Service Provider with Owner.  
 

 (d)
 Zoning and Construction. Upon Horizon’s written request, Service Provider shall identify all zoning and construction requirements with respect to each Tower Site (including any permits and variances which Horizon may need in connection with each Tower Site) and shall assist Horizon to obtain all such permits and variances by, among other things, completing applications for permits or variances, presenting such applications to the appropriate governmental authority, coordinating with appropriate governmental authorities to obtain the approval of any applications submitted and otherwise take such actions as may be necessary in order for Horizon to be in compliance with all zoning and construction requirements with respect to the Tower Site.  Upon delivery by Service Provider to Horizon of any necessary zoning or construction permits and variances (the “Zoning and Construction Permits”) Horizon may, in its sole discretion, request Service Provider to begin negotiations with possible Anchor Tenants (defined below) or may inform Service Provider to cease work with respect to a Tower Site.   
  
 

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 (e)
 Anchor Tenant.  Upon receipt from Horizon of its approval to commence negotiations with a potential tower space licensee who will be the first and primary licensee at a Tower Site (the “Anchor Tenant”) Service Provider shall approach possible Anchor Tenants and negotiate the business terms of a tower space license between Horizon and the Anchor Tenant (the “Anchor Tenant License”) using Horizon’s approved form of tower space license.  Service Provide shall keep Horizon informed with respect to the negotiations and provide Horizon with all drafts of the Anchor Tenant License for Horizon’s review and approval.  Unless otherwise approved in writing by Horizon, the Anchor Tenant License shall be for a minimum term of five (5) years.  All Anchor Tenant Licenses are subject to the final review and approval of Horizon, in its sole discretion.  Horizon may, in its sole discretion, determine whether it will enter into an Anchor Tenant License negotiated by Service Provider with an Anchor Tenant.  
 

 (f)
 Construction Management Services.  Service Provider shall serve as Horizon’s construction manager during the construction of a tower on each Tower Site and shall coordinate with and supervise all contractors and subcontractors during the construction process to ensure that the tower is built to the specifications identified by Horizon.
 

 3.
 Fees for Development Services.  In exchange for the performance by Service Provider of the Development Services, Horizon will pay to Service Provider the following fees (collectively the “Development Fees”):
 

 (a)
 Horizon shall pay Service Provider $5,000 for each Due Diligence Commencement Notice issued by Horizon to Service Provider following Horizon’s review of a Tower Site Report with respect to a Tower Site, within 10 days after delivery of each Due Diligence Commencement Notice.
 

 (b)
 Horizon shall pay Service Provider $7,500 for each completed Due Diligence Report delivered by Service Provider to Horizon, within 10 days after delivery of such Due Diligence Report.
 

 (c)
 Horizon shall pay Service Provider $15,000 within 10 days after the execution of a Ground Lease between Horizon and Owner.
 

 (d)
 Horizon shall pay Service Provider $15,000 within 10 days after Service Provider’s delivery to Horizon of all Zoning and Constructions Permits, issued by final order, with respect to a Tower Site.
 

 (e)
 Horizon shall pay Service Provider $35,000 on the later of (i) 10 days after Service Provider delivers to Horizon the Anchor Tenant’s signature to an Anchor Tenant License which has been approved in advance by Horizon or (ii) completion of the four milestones described in Section 3(a) through 3(d) above.    
 

 (f)
 Horizon shall pay Service Provider $5,000 within 10 days after completion of the construction of a tower at a Tower Site.
  
 

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 4.
 Marketing Services.  Service Provider shall provide the following services to Horizon at Service Provider’s sole cost and expense (collectively, the “Marketing Services” and, together with the Development Services, the “Services”):
 

 (a)
 Marketing.  Commencing upon execution of a Ground Lease for a Tower Site, Service Provider shall advertise and market such Tower Site to potential tower space licensees.
 

 (b)
 License Negotiation.  Service Provider shall negotiate the business terms of tower space licenses between Horizon and potential tower space licensees, using Horizon’s approved form of tower space license.  Service Provide shall keep Horizon informed with respect to the negotiations and provide Horizon with all drafts of all tower space licenses being negotiated for Horizon’s review and approval.  Unless otherwise approved in writing by Horizon, all tower space licenses shall be for a minimum term of five (5) years.  Horizon may, in its sole discretion, determine whether it will enter into a tower space license negotiated by Service Provider.  Horizon may independently advertise and market the Tower Site and directly enter into tower space licenses with potential tower space licensees without Service Provider’s involvement.  Any such tower space licenses entered into as a result of Horizon’s efforts shall not be subject to the Marketing Fees described below. 
 

 5.
 Fees for Marketing Services.  In exchange for the performance by Service Provider of the Marketing Services, Horizon will pay to Service the following fees (the “Marketing Fees”):
 

 (a)
 Starting on the date construction of a Tower Site is completed (the “Commencement Date”) and continuing for forty-eight (48) months thereafter (the “Marketing Period”), Horizon shall pay Service Provider the amounts described below for each tower space license that “commences” at the Tower Site during the Marketing Period.  As used herein, a tower space license has “commenced” when Horizon and the tower space licensee have entered into a binding, written tower space license agreement for an initial term of no less than five (5) years and the first monthly rental payment has been timely made.  Notwithstanding anything to the contrary herein, Service Provider shall not be entitled to any Marketing Fees for the Anchor Tenant License and for any other tower space licenses entered into as a result of Horizon’s marketing efforts (collectively the “Excluded Licenses”).
 

 (b)
 Upon execution of a tower space license, other than an Excluded License, Horizon and Service Provider shall determine the annual cash flow to be generated by such tower space license by calculating the annual rental payments to be made to Horizon by the tower space licensee under the tower space license less all tower expenses such as ground rents, taxes, insurance and maintenance (the “Annual TCF”).  
 

 (c)
 In exchange for the Marketing Services, Horizon shall pay Service Provider a single payment an amount equal to four (4) times the Annual TCF for each tower space license, other than Excluded Licenses, that commences within twelve (12) months after the Commencement Date.  The payment amount shall be equal to three (3) times the Annual TCF for each tower space license, other than Excluded Licenses, that commences between thirteen (13) 
 

 

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 and twenty-four (24) months after the Commencement Date, two (2) times the Annual TCF for each tower space license, other than Excluded Licenses, that commences between twenty-five (25) and thirty-six (36) months after the Commencement Date and one (1) times the Annual TCF for each tower space license, other than Excluded Licenses, that commences between thirty-seven (37) and forty-eight (48) months after the Commencement Date.
 

 (d)
 The marketing payments described herein with respect to a tower space license shall be paid to Service Provider within ten (10) days after such tower space license commences.
 

 (e)
 Notwithstanding anything herein to the contrary, the Marketing Period shall terminate upon a sale by Horizon of substantially all of its assets or equity and, effective as of the closing date of such transaction, neither Horizon nor its successor shall have any obligation to make any further marketing payments to Service Provider for any tower space licenses entered into thereafter.
 

 6.
 Term and Termination.  This Agreement commence on the date hereof and continue for a period of one year (the “Initial Term”) and thereafter shall automatically renew in six month intervals (each an “Extended Term” and, together with the Initial Term, the “Term”) unless either party provides written notice to the other party of its intent not to renew at least 30 days prior to the expiration of the then current Term.  In addition, either party may terminate this Agreement at any time and for any reason upon 30 days prior written notice to the other party.  
 

 7.
 Representations and Warranties of Service Provider.  Service Provider hereby represents and warrants to Horizon as follows:
 

 (a)
 Service Provider is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, and is qualified to do business in each jurisdiction in which a Tower Site is located, to the extent required by law.  Service Provider has the requisite power and authority to execute, deliver and perform this Agreement and to consummate the transactions contemplated hereby.
 

 (b)
 The execution, delivery and performance of this Agreement by Service Provider have been duly authorized and approved by all necessary action of Service Provider and do not require any further authorization or consent of Service Provider.  This Agreement is a legal, valid and binding agreement of Service Provider, enforceable in accordance with its terms, except in each case as such enforceability may be limited by bankruptcy, moratorium, insolvency, reorganization or other similar laws affecting or limiting the enforcement of creditors’ rights generally.
 

 (c)
 The execution, delivery and performance by Service Provider of this Agreement does not conflict with any organizational documents of Service Provider or any law, judgment, order, or decree to which Service Provider is subject, or require the consent or approval of, or a filing by Service Provider with, any governmental or regulatory authority or any third party.
 

 

 

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 8.
 Covenants of Service Provider.  Service Provider covenants to Horizon as follows:
 

 (a)
 Service Provider shall perform the Services in a professional, timely manner, consistent with any instructions, policies and procedures provided by Horizon and consistent with good industry practices and in compliance with all applicable laws. 
 

 (b)
 Service Provider shall prepare a Tower Site Report exclusively for Horizon for each and every Tower Site that Service Provider is considering for development.  Service Provider may not present such Tower Site Reports to any other person or entity without the prior written approval of Horizon.
 

 9.
 Confidential Information.  Any information obtained by Service Provider concerning the business or affairs of Horizon which is not publicly available, including, without limitation, all copyrights, patents, trademarks, trade secrets, business plans, financial information, drawings, models, processes, software, source code and documents (“Confidential Information”) is the property of Horizon.  Service Provider shall not use or disclose any Confidential Information without the prior written consent of Horizon.  Service Provider shall promptly deliver to Horizon at the expiration of the Term, or at any other time Horizon may request, all Confidential Information and all memoranda, notes, plans, records, reports, computer tapes, software and other documents and data (and copies thereof) relating to Confidential Information which Service Provider may then possess or have under Service Provider’s control.
 

 10.
 Non-Compete, Non-Solicitation.  During the Term and for a period of 24 months thereafter, Service Provider shall not directly or indirectly perform, participate in or in any manner engage in consulting or advisory services with respect to any company that develops, acquires, operates, markets, leases or manages towers within a five (5) mile radius of any current or planned Tower Site of Horizon (including any Tower Sites identified by Service Provider pursuant to the terms of this Agreement).  Service Provider agrees that this covenant is reasonable with respect to its duration, geographical area and scope.  During the Term and for a period of 24 months thereafter, Service Provider shall not directly or indirectly (i) solicit, encourage, interview, entice, discuss with or induce or attempt to induce any employee of Horizon to leave the employ of Horizon, or in any way interfere with the relationship between Horizon and any employee thereof, (ii) hire any person who is/was an employee of Horizon at any time during the Term, or (iii) induce or attempt to induce any customer, supplier, licensee or other business relation of Horizon to cease doing business with Horizon, or in any way interfere with the relationship between any such customer, supplier, licensee or business relation and Horizon.
 

 11.
 Enforcement.  If, at the time of enforcement of paragraphs 9 or 10 of this Agreement, a court holds that the restrictions stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum period, scope or geographical area reasonable under such circumstances shall be substituted for the stated period, scope or area.  Because Service Provider’s services are unique and because Service Provider has access to Confidential Information, the parties hereto agree that money damage would be an inadequate remedy for any breach of this Agreement.  Therefore, in the event of a breach or threatened 
 

 

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 breach of this Agreement by Service Provider, Horizon, or its successors or assigns, shall be entitled to a decree for specific performance and/or injunctive or other relief in order to enforce, or prevent any violations of, the provisions hereof (without posting a bond or other security).
 
 12.
 Indemnity.  Service Provider shall be liable for and agrees to pay any and all losses, costs, damages, liabilities and expenses, including reasonable attorneys’ fees and expenses incurred by Horizon arising out of Service Provider’s provision of the Services.  In addition, Service Provider shall defend, indemnify and hold harmless Horizon from and against any and all losses, costs, damages, liabilities and expenses, including reasonable attorneys’ fees and expenses incurred by Horizon arising out of or resulting from (i) any breach by Service Provider of its representations and warranties under this Agreement; (ii) any default by Service Provider of any of its covenant or agreement made under this Agreement; (iii) death or injury of persons, including, but not limited to employees and customers of Horizon and Service Provider and any damage or destruction of property related to the provision of the Services by Service Provider.
 
 13.
 General Provisions.
 
 (a)
 Complete Agreement.  This Agreement embodies the complete agreement and understanding between the parties and supersedes and preempts any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way including, without limitation, the non-binding Term Sheet executed by the parties on June 20, 2011.
 
 (b)
 Assignment.  The rights and obligations of Service Provider under this Agreement may not be assigned by Service Provider without the consent of Horizon. This Agreement shall inure to the benefit of Horizon and its successors and assigns and shall be binding upon Service Provider and its successors and assigns.  
 
 (c)
 Amendment and Waiver.  No amendment, modification or waiver of this Agreement shall be binding or effective for any purpose unless it is made in a writing signed by the party against whom enforcement of such amendment, modification or waiver is sought.  No course of dealing between the parties to this Agreement shall be deemed to affect or to modify, amend or discharge any provision or term of this Agreement.  No delay on the part of Horizon or Service Provider in the exercise of any of their respective rights or remedies shall operate as a waiver thereof, and no single or partial exercise by Horizon or Service Provider of any such right or remedy shall preclude other or further exercises thereof.  A waiver of right or remedy on any one occasion shall not be construed as a bar to or waiver of any such right or remedy on any other occasion.
 
 (d)
 Notices.  All notices, requests, demands and other communications required or permitted under this Agreement shall be in writing (which shall include notice by facsimile transmission) and shall be deemed to have been duly made and received when personally served, or when delivered by Federal Express or a similar overnight courier service, expenses prepaid, or, if sent by facsimile communications equipment, delivered by such equipment, addressed as set forth below:
 

 

 

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 (i)
 If to Service Provider, then to:
 

 Massive Dynamics Inc.
 PO Box 10789
 Newport Beach, CA 92658
 Attention: Don Calabria
 

 With a copy (which shall not constitute notice) to:
 

 Frank Hariton, Esq.
 1065 Dobbs Ferry Road 
 White Plains, New York 10607
 

 (ii)
 If to Horizon, then to:
 

 Horizon Tower, LLC
 117 Town & Country Drive, Suite A
 Danville, CA 94526
 Facsimile:  925.314.1114
 Attention:  John Kapulica
 

 With a copy (which shall not constitute notice) to:
 

 Edinger Associates
 1875 I St. NW, Suite 500
 Washington DC, 20006
 Facsimile:  202.747.1691
 Attention:  Brook Edinger
 

 Any party may alter the address to which communications are to be sent by giving notice of such change of address in conformity with the provisions of this Section providing for the giving of notice.
 
 (e)
 Construction.  The language used in this Agreement will be deemed to be the language chosen by the parties hereto to express their mutual intent, and no rule of strict construction will be applied against any party.
 

 (f)
 Acknowledgments.  Service Provider hereby acknowledges and agrees that: (i) Service Provider has been advised by counsel in the negotiation, execution and delivery of this Agreement; (ii) Horizon has no fiduciary relationship with or duty to the Service Provider arising out of or in connection with this Agreement or otherwise; (iii) no joint venture is created hereby or otherwise exists by virtue of the transactions contemplated hereby among any of the Service Provider, Horizon, or any other party; and (iv) this Agreement does not, and shall not be construed to, grant Service Provider any right to perform any consulting services for Horizon.
 

 (g)
 Tax Returns.  Service Provider shall file all tax returns and reports required to be filed by Service Provider on the basis that Service Provider is an independent 
 

 

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 contractor, rather than an employee, as defined in Treasury Regulation § 31.3121(d)-1(c)(2).  Service Provider shall indemnify Horizon for the amount of any employment taxes required to be paid by Horizon as the result of any failure by Service Provider to pay any taxes.
 

 (h)
 Expenses.  Each party shall bear its own expenses in connection with the negotiation, execution and performance of this Agreement and all documents ancillary thereto.
 

 (i)
 Choice of Law.  This Agreement will be governed by the internal law of the State of Delaware without regard for the laws of conflicts.
 

 (j)
 Counterparts.  This Agreement may be executed in separate counterparts, each of which shall be deemed to be an original and all of which taken together constitute one and the same agreement.
 

 [SIGNATURE PAGE FOLLOWS]
 

 

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 SIGNATURE PAGE TO SERVICES AGREEMENT
 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.
 

 HORIZON:
 HORIZON TOWER, LLC
 

 By:
 /s/ John Kapulca
 Name: John Kapulica
 Title:   President
 

 

 SERVICE PROVIDER:
 MASSIVE DYNAMICS INC.
 

 By:
 /s/ Don Calabria
 Name: Don Calabria
 Title:   CEO & President
 

 

 

 10chatching_ex41.htm

Exhibit 4.1

 

ChatChing Inc.

Employee/Consultant Benefit Plan

1. Purpose. The purpose of this Employee/Consultant Benefit Plan (the “Plan”) is to provide for compensation for Consultants from ChatChing Inc., a Florida corporation (the “Company”);Consultant who provides certain services in furtherance of the business plan of ChatChing as specified in this Plan and in the Company’s Registration Statement to be filed on Form 10 with the Securities and Exchange Commission.

 

2. Points Subject to the Plan. The Points to be offered under the Plan will be issued to Qualified Consultants as defined in Section 6, at times and in amounts as described in Section 7. The total number of Points that may be issued under the Plan is not limited. Validly issued Points will not expire or terminate, except when and to the extent used in an Allocation or as provided in Section 10.

 

3. Compensation Subject to the Plan.

 

3.1 Plan Shares.  Subject to adjustment as provided below and in Section 10, and only if and when all conditions of Section 11 of the Plan are satisfied, the shares to be offered under the Plan (the “Plan Shares”) shall consist of common stock of the Company (“Common Stock”), and the total number of Plan Shares that may be issued under the Plan shall be 400,000,000 shares. The Plan Shares shall be issued to Qualified Consultants in exchange for Points, one Plan Share for one Point, in a series of allocation processes (each, an “Allocation”).

 

3.2 Compensation to Consultants.

 

A.  All Consultants will receive the following compensation:  Points may be used in the online point store where members will be able to purchase premium listing that promote their ChatChing network and encourage others to enroll in their network.  Inclusion in the featured Network leaser section will initially cost 5,000 points for 7 days.  Additionally the ability to post messages to ChatChing networks will be able to be purchased at the cost of 5,000 points to post a message to all network members at your tier of the networks that you are part of or 10,000 points for all network members that are part of the members ChatChing network and those networks below extending down five down levels.

B.  Compensation If and When Shares of Common Stock, called Plan Shares, may be issued under the Plan:  All Consultants will have the additional option to elect to apply points to the acquisition of Plan Shares if and when Plan Shares can be issued under the Plan.  Until then:  The Company may not offer and sell these securities until a registration statement is filed with the Securities and Exchange Commission and becomes effective. Nothing herein or in the Plan constitutes an offer to sell these securities and the Company is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

  

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4. Effective Date and Duration of Plan.

 

4.1 Effective Date. The Plan shall become effective as of _________, 2011. Points may be issued under the Plan at any time after the effective date and before termination of the Plan.

 

4.2 Duration. The Plan shall continue in effect until the earlier of (a) such time as the Plan is terminated by the Board of Directors, or (b) the commencement of the final Allocation as described in Section 9. The Board of Directors may suspend or terminate the Plan at any time except with respect to Points then outstanding under the Plan. Notice of any such suspension or termination will be provided on the Site. Termination shall not affect any outstanding Points issued under the Plan.

 

5. Administration.

 

5.1 Board of Directors. The Plan shall be administered by the Board of Directors of the Company. Subject to the provisions of the Plan, the Board of Directors may adopt and amend rules and regulations relating to administration of the Plan, advance the lapse of any waiting period, waive or modify any condition or restriction applicable to Points (except those restrictions imposed by law) and make all other determinations in the judgment of the Board of Directors necessary or desirable for the administration of the Plan. The interpretation and construction of the provisions of the Plan and related agreements by the Board of Directors shall be final and conclusive. The Board of Directors may correct any defect or supply any omission or reconcile any inconsistency in the Plan or in any related agreement in the manner and to the extent it deems expedient to carry the Plan into effect, and the Board of Directors shall be the sole and final judge of such expediency.

 

5.2 Committee. The Board of Directors may delegate to any committee of the Board of Directors (the “Committee”) any or all authority for administration of the Plan.  If authority is delegated to the Committee, all references to the Board of Directors in the Plan shall mean and relate to the Committee, except (i) as otherwise provided by the Board of Directors and (ii) that only the Board of Directors may amend or terminate the Plan as provided in Sections 4.2 and 12.

 

6. Qualified Consultants. A “Qualified Consultant” is a legally competent individual that is a legal resident of a jurisdiction in which the Board of Directors has determined that residents may lawfully be Consultants to the Company and receive the compensation as specified in this Plan, and that has met the other requirements of this Section and such other requirements as are determined by the Board of Directors. A Qualified Consultant must register online with the Site; indicate that he or she desires to become a Consultant; provide all information requested by the Site, including name, age, date of birth, and address; and certify that he or she has received a current copy all information required to be delivered to Consultant, as available through and specified on the Site.  The Consultant must electronically execute the Consulting Agreement as specified on the Site.  All such information provided by Consultant must be true and correct. A Consultant who provides false information or who uses abusive procedures to earn Points, as determined by the Board of Directors, or who takes any action in violation of Section 8 or any other provision of the Plan, will at the option of the Board of Directors cease being a Qualified Consultant and may forfeit Points previously earned.  Abusive procedures include, without limitation, (a) the use of bots or other automated procedures to generate activities to earn Points, and (b) having more than one Consultant profile or using another Consultant’s profile to generate Points.

 

  

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7. Awards of Points. Points will be issued by the Company only to Qualified Consultants, based on the Qualified Consultant’s daily activities on the Site and on certain activities on the Site by themselves or others as specified in the Plan  for no cash payment. The Site will display a Qualified Consultant’s total points on a “Points Counter”. The Points Counter will be updated daily. In the event of any discrepancy between the Points Counter and the Company’s records of a Qualified Consultant’s Points, the Company’s records will control.  Exhibit A shows the number of Points that the Company will issue for services rendered by the Qualified Consultant under the Consulting Agreement and this Plan. Exhibit A may be amended by the Board of Directors from time to time, and will apply to Points issued after any such amendment.

 

8. Nontransferability. Points are nonassignable and nontransferable, either voluntarily or by operation of law, except by will or by the laws of descent and distribution of the state or country of the Qualified Consultant’s domicile at the time of death (a “Permitted Transfer”). Any attempt by a Qualified Consultant to assign, transfer, pledge, hypothecate, mortgage, grant a security interest in, sell, lease, or otherwise dispose of, any Points, other than by a Permitted Transfer, shall be null and void and of no force or effect whatsoever, and may at the election of the Board of Directors result in the forfeiture of such Points. Points are personal and may not be used by anyone other than the Qualified Consultant to whom such Points were issued.

 

9. Allocations of Common Stock. Subject to the conditions of the Plan, and if an when the Company can legally pay compensation under the Consulting Agreement and the Plan under all applicable laws, as determined by the Board of Directors, and if the Consultant elects to be compensated in Plan Shares rather than other forms of compensation available under the Consulting Agreement and the Plan, the Company will conduct 20 or more Allocations of Plan Shares to such Qualified Consultants. In each Allocation, participating Qualified Consultants who satisfy the Vesting Condition as defined below will be entitled to exchange Points for Plan Shares.  Each of the first 20 Allocations will offer 20,000,000 Plan Shares to Qualified Consultants (“Allocation Shares”).

 

9.1 Commencement of Allocations. The initial Allocation will be commenced within 90 days following the time when the number of the Company’s Qualified Consultants first exceeds one million. Allocations after the initial Allocation will be commenced within 90 days following the end of every calendar quarter thereafter, if within such quarter (an “Allocation Quarter”) the total number of Qualified Consultants has increased to at least one million more than the Prior Minimum, until a total of 20 Allocations have been completed. “Prior Minimum” means the minimum number of Qualified Consultants required for the immediately preceding Allocation.

 

  

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9.2 Allocation Process. The first Allocation shall commence with notice from the Company (an “Allocation Notice”) to the first one million Qualified Consultants. Subsequent Allocations shall commence with an Allocation Notice to all Qualified Consultants as of the last day of the Allocation Quarter. Allocation Notices shall be given during the 90 days referred to in Section 9.1, by email or through the Qualified Consultant’s Site login. To be qualified to acquire Plan Shares in an Allocation, each Qualified Consultant will be required to provide and validate certain personal identifying information and to confirm the Qualified Consultant’s intent that his or her Points participate in the Allocation, within the time periods established by the Company and communicated to Qualified Consultants. Qualified Consultants who have provided and verified such information, and been approved by the Company, are referred to as “Validated Consultants.”

 

The number of Allocation Shares each Validated Consultant will be eligible to acquire will be the Validated Consultant’s pro rata portion of the Allocation Shares, based on the ratio of the number of the Qualifying Consultant’s Points to the aggregate number of Points of all Qualified Consultants participating in that Allocation. No cash payment will be required for Offered Shares issued to Validated Consultants, other than a reasonable fulfillment fee as determined by the Board of Directors. No Validated Consultant shall have any rights as a shareholder, by virtue of any Allocation, until the date, if any, that such Validated Consultant becomes the holder of record of those shares. Points held by Qualified Consultants eligible to participate in an Allocation who fail or elect not to become a Validated Consultant will be cancelled.

 

9.3 No Fractional Shares. No fractional shares shall be issued in connection with any Allocation, and any fractional shares that would otherwise result from any Allocation may be disregarded or provided for in any manner determined by the Board of Directors. Any such determination by the Board of Directors shall be conclusive. Points otherwise exchangeable for such fractional shares will be retained by the Qualified Consultant.

 

9.4 Vesting Condition. In each Allocation, a Validated Consultant’s award of Allocation Shares will be contingent on a vesting requirement that in the 12 months beginning with the Company’s Allocation Notice (“Vesting Period”) the Validated Consultant earn additional Points equal to or greater in number than the number of the Validated Consultant’s Points participating in that Allocation (“Vesting Condition”).

 

(a) Shares will be issued within 90 days after the end of the Vesting Period to Validated Consultants who satisfied the Vesting Condition. If a Validated Consultant does not satisfy the Vesting Condition, no Plan Shares will be issued in that Allocation to that Validated Consultant, and the Validated Consultant’s Points that participated in that Allocation will be cancelled.  Plan Shares not issued to any Validated Consultant because the Vesting Condition was not satisfied (“Unvested Shares”) will not be issued in that Allocation.

 

(b) Any change made to Exhibit A during the Vesting Period of an Allocation, pursuant to Section 7, which will reduce the number of Points earned for one or more activities, will not be applicable during such Vesting Period to Qualified Consultants participating in such Allocation.

 

9.5 Unvested Shares. In the event that there are Unvested Shares after the first 20 Allocations, one or more additional Allocations will be conducted under the above provisions of this Section 9, for not more than 20,000,000 Plan Shares per Allocation and until all Unvested Shares shall have been issued.  If after any of such Allocations there remain less than 1,000,000 Unvested Shares, then no further Allocations shall be conducted.

 

  

4

  

 

10. Changes in Capital Structure.

 

10.1 Stock Splits, Stock Dividends. If the outstanding Common Stock of the Company is hereafter increased or decreased or changed into or exchanged for a different number or kind of shares or other securities of the Company by reason of any stock split, combination of shares, dividend payable in shares, recapitalization or reclassification, appropriate adjustment shall be made by the Board of Directors in the number of unissued Plan Shares and in the number of Allocation Shares. Notwithstanding the foregoing, the Board of Directors shall have no obligation to effect any adjustment that would or might result in the issuance of fractional shares, and any fractional shares resulting from any adjustment may be disregarded or provided for in any manner determined by the Board of Directors. Any such adjustments made by the Board of Directors shall be conclusive.

 

10.2 Mergers, Reorganizations, Etc. In the event of a merger, consolidation, plan of exchange, acquisition of property or stock, split-up, split-off, spin-off, reorganization or liquidation to which the Company is a party or any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all, or substantially all, of the assets of the Company (each, a “Transaction”), the Board of Directors shall, in its sole discretion and to the extent possible under the structure of the Transaction, select one or more of the following alternatives for treating the Plan and outstanding Points under the Plan:

 

(a) Some or all outstanding Points shall remain in effect in accordance with their terms.

 

(b) Some or all outstanding Points shall be converted into Points to acquire stock in one or more of the corporations, including the Company, that are the surviving or acquiring corporations in the Transaction. The number and type of securities subject thereto shall be determined by the Board of Directors of the Company, taking into account the relative values of the companies involved in the Transaction and the exchange rate, if any, used in determining shares of the surviving corporation(s) to be held by holders of shares of the Company following the Transaction.

 

(c) The Plan shall continue, provided that Points issued after the closing of the Transaction will be exchangeable, pursuant to the Plan, for stock in one or more of the corporations, including the Company, that are the surviving or acquiring corporations in the Transaction. The number and type of securities subject thereto shall be determined by the Board of Directors of the Company, taking into account the relative values of the companies involved in the Transaction and the exchange rate, if any, used in determining shares of the surviving corporation(s) to be held by holders of shares of the Company following the Transaction.

 

(d) The Plan shall be terminated and all outstanding Points cancelled.

 

10.3 Dissolution of the Company. In the event of the dissolution of the Company, Points shall be treated in accordance with Section 10.2(d).

 

10.4 Additional Shares. The Company is not restricted by this Plan in any way from issuing additional shares of its Common Stock or any other equity or debt securities.

 

  

5

  

 

11. Conditions to Issuance of Shares. Plan Shares shall not be issued under the Plan unless such issuance shall comply with all relevant provisions of law, including, without limitation, any applicable state securities laws, the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder, applicable laws of foreign countries and other jurisdictions and the requirements of any quotation service or stock exchange on which the shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance. The inability of the Company to obtain, from any regulatory body having jurisdiction, the authority deemed by the Company’s counsel to be necessary for the lawful issuance and sale of any Plan Shares hereunder or the unavailability of registration or an exemption from registration for the issuance and sale of any Plan Shares hereunder shall relieve the Company of any obligation hereunder and any liability for the failure to issue or sell any such Plan Shares.

 

12. Amendment of the Plan. The Board of Directors may at any time modify or amend the Plan in any respect, and will give reasonable notice of any such modification or amendment to Qualified Consultants through the Site. The Plan may only be modified in writing.

 

13. Rights as a Shareholder. The recipient of any Points under the Plan shall have no rights as a shareholder, by virtue of such Points, with respect to any shares of Common Stock until the date, if any, that such recipient becomes the holder of record of those shares.

 

14. Governing Law. The Plan shall be governed by and construed in accordance with the internal laws of the State of Florida without giving effect to any choice or conflict of law provision or rule (whether of the State of Florida or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Florida.

 

15. Entire Plan. The Plan, including any exhibits hereto, constitutes the complete and entire plan and commitment of the Company with respect to the subject matter hereof and supersedes all prior agreements, understandings and commitments of the Company, both written and oral, with respect to its subject matter.

 

The Plan was adopted by the Board of Directors on _____________, 2011.

  

6

  

EXHIBIT A

 

	
Business Development or Promotional Service

	 	
Points Awarded

	 	
Frequency Limit

	  	  	 	  	 	  
	
Post invite Link to Major Social Network Site

	 	  	 	  
	  	
Post an Invite to recognized Social Networking site

	 	
100

	 	
Once per Site per Month

	  	  	 	  	 	  
	  	
Post a link on other web site acceptable to ChatChing.com.  We reserve the right to disqualify sites with limited user traffic and for other reasons.

	 	
10

	 	
Ten per Month

	  	  	 	  	 	  
	
Email Invites

	  	 	
1

	 	
Once Per Email Address

	  	  	 	  	 	  
	
Accepted Invite  Users Provides Basic Profile Data

	 	
100

	 	
No Limit

	  	  	 	  	 	  
	
Points Awarded for User Activity

	 	  	 	  
	  	
Complete Profile All Basic Data

	 	
100

	 	  
	  	
100% complete profile

	 	
100

	 	  
	  	
Upload Photo

	 	
5

	 	
5 Per Day

	  	
Update Status

	 	
1

	 	
3 Times a Day

	  	
Post a Comment to Wall, Status, Blog, Photo, Album, Forum

	 	
2

	 	
Once Per Profile Page

	  	
Tag a Photo

	 	
3

	 	
Once Per Photo

	  	
Add Friend

	 	
5

	 	
25 per month

	  	
Establish Special Friend Relationship

	 	
25

	 	
10 Lifetime

	  	
Send Message

	 	
1

	 	
5 Per Day / One 

Per Profile Contacted

	  	  	 	  	 	  
	
Points Earned from Other Users' Activity on your content

	 	  	 	  
	  	
View to Users' profile

	 	
2

	 	
5 Per Day - Once per profile

	  	
Receive a comment to Wall or Post

	 	
2

	 	
5 Per Day - Once per profile

	  	
Posted comment  to one of your posts

	 	
2

	 	
5 Per Day - Once per profile

	  	
Receive Message

	 	
1

	 	
5 Per Day - Once per profile

	  	
Views and Users Photoalbum

	 	
2

	 	
5 Per Day - Once per profile

  

7

  

 

 

Points from Activities by Invitees.   A new User that joins the Site through the invitation of a Qualified User becomes a “Network Member” of the Qualified User that invited the User. At such time as that Network Member becomes a Qualified User, the inviting Qualified User will receive credit on an ongoing basis for 50% of the Points earned by such Network Member, including Points earned by the Network Member from its own Network Members. In the event a new User has received invites from multiple Qualified Users, (1) the inviting Qualified Users will receive credit in the aggregate, on an ongoing basis, for 50% of the Points earned by such Network Member after the Network Member becomes a Qualified User, and (2) such Points allocated to the inviting Qualified Users will be divided equally among the inviting Qualified Users.  In the event of a member being on multiple ChatChing networks, Invitee points will be split equally amongst each ChatChing Network they are part of.  (Example: if a member or your ChatChing Network earns 400 Points and they are on three ChatChing Networks each of those networks would receive [400*67%/3] 100 Points.

 

 

 

 

  

8

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