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Consulting Services Agreement

Consulting Services Agreement

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 This Consulting Services Agreement involves

QUAMTEL, INC. | iTella, Inc | WQN, Inc

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Governing Law: Florida     Date: 11/16/2009

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THIS CONSULTING AGREEMENT (the “Agreement”), is made and entered into as of this 2 nd day of August, 2009 (the "Effective Date"), by and among WQN, Inc., a Texas corporation (the “Company”), Quamtel, Inc., (“Parent”) and iTella, Inc., (hereinafter referred to as “Consultant”), as amended and restated on November 4th, 2009.  The Company and Consultant are sometimes collectively referred to as “Parties” or individually as a “Party”.


WHEREAS, the Company is an emerging global provider of advanced communications services specializing in Virtual calling cards with 100% online distribution, residential and Business phone replacement services with low cost international termination and Toll Free-Virtual Fax with unified messaging capabilities utilizing Voice over Internet Protocol (VOIP) as its core technology component; and


WHEREAS, Consultant has significant experience with operations, administration, financing, marketing and day to day operations of the Company; and

WHEREAS, the Company desires to utilize Consultant’s business expertise and Consultant desires to provide services to the Company.

NOW, THEREFORE, in consideration of the mutual promises and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby expressly acknowledged, the Parties agree as follows:





Appointment .  The Company hereby engages Consultant to furnish the services described in Article 3 of this Agreement, and Consultant hereby accepts such engagement.  The Consultant agrees to use its best efforts to perform its duties, responsibilities, and obligations set forth in this Agreement.


Status of the Parties .  It is expressly understood and agreed that in the performance of services under this Agreement, Consultant shall, at all times, be an independent contractor with respect to the Company, and not an agent, officer or employee of the Company.  Further, it is expressly understood and agreed by the Parties that nothing contained in this Agreement is intended to create a joint venture, partnership, association or other affiliation or like relationship between the Parties.  In no event shall either Party be liable for the debts or obligations of the other Party.  Consultant understands that it will not be treated as an employee for Federal tax purposes and that Consultant shall be responsible for all taxes, Social Security and FICA payments and withholding.  Consultant shall not be entitled or eligible to receive workman’s compensation insurance, disability or unemployment insurance benefits or any other employee benefits offered by the Company to its employees.




The Company shall at all times retain and exercise full control over the operations of the Company’s business.  Nothing in this Agreement shall be deemed to delegate to Consultant any such control or responsibility.  Consultant shall perform only those functions set forth in this Agreement or otherwise delegated by the Company, and shall be solely responsible for determining the manner in which the services are rendered.  The Company shall provide Consultant with access to the Company's premises and its employees to enable Consultant to perform its services hereunder.



Consultant shall devote its best efforts, skill and sufficient time and attention to carry out its responsibilities under this Agreement.  Consultant shall report to the Chief Executive Officer of the Company (the "Chief Executive Officer") and the Board of Directors of the Company (the "Board of Directors").  Consultant shall provide, at the reasonable request of the Chief Executive Officer and the Board of Directors (the "Management"), advanced business strategy, financing, product development and marketing advice including but not limited to day to day operations.  Consultant shall act in substantial accordance with all reasonable instructions and directives of Management.  Consultant shall comply with all written policies and procedures of the Company that are furnished to it and which are applicable to Company employees in general, in connection with the performance of services hereunder.  Consultant shall be available, at reasonable times and upon reasonable notice, to consult with Management.




Consideration .  In consideration of the services provided by Consultant pursuant to this Agreement, the Company shall pay to Consultant $200,000 on an annual (12 calendar month) basis for a period of six months then after the first six months starting February 1 st 2010 the annual basis will increase to $250,000., All payments shall be payable in equal monthly installments commencing on the Effective Date of August 2 nd 2009, and the above base compensation shall be in addition to the profit sharing compensation listed in section 5.2 and other benefits listed in article 5.


Reasonableness of Payments .  The amounts paid to Consultant hereunder have been determined by the Parties in good faith and through arms-length negotiation and are intended to be based on fair market value for the services rendered by the Consultant.




Reimbursement of Expenses .   The Company shall reimburse Consultant for business expenses incurred in the performance of its services pursuant to this Agreement, including, without limitation, travel, entertainment, and the use of any and all communications devices without limit.  Requests for reimbursement must be in writing and accompanied by appropriate documentation.  


Revenue sharing.  Consultant shall be entitled to and is due to receive revenue sharing in such amounts of a total of nine percent (9%) of all current and future Parent and  Company  gross revenues.  Gross revenues are payable at such times as results are reported in quarterly Form 10-Q’s . This benefit is owing and due over the life of the contract and any renewals.



Office Space .   The Company shall, at its sole expense, provide Consultant with a business office suitable for use by Consultant in the performance of its services at the Company's executive offices or at a location satisfactory to Consultant within a ten (10) mile radius of Consultant's address (as stated in the notice section hereof) and the Company shall pay the costs relating to the upkeep, maintenance, and use of such office together with reasonable and customary administrative support at such office.




Health Benefits.  During the term, the Company shall pay for 100% of the costs to provide up to three employees of Consultant with “family” coverage for medical and dental, if permitted by the Company’s health insurance policy..


Vehicle.  The Company shall provide Consultant with a vehicle allowance of $1,000 monthly in addition to reimbursement for insurance coverage.


Stock Option Plan .  In consideration of the execution by Consultant of this Agreement and for services rendered hereunder, employees of Consultant  may be eligible for grants of stock options pursuant to the Parent’s  Equity Incentive   Plan in such amounts as may from time to time be determined by the Board of Directors of Parent (or the Stock Option/Compensation Committee), in its sole discretion..






Term .  The term of this Agreement shall be for a period of Five years from the Effective Date.  This Agreement shall automatically renew for successive one year period if approved by both parties.  This Agreement shall automatically terminate upon (i) failure of the Consultant to perform its duties hereunder; (ii) failure of Consultant to provide adequate staffing for its obligations, or (iii)  a Change of Control of the Company, as defined below , in which case  Consultant shall be entitled to receive (a) a lump sum payment from the Company, within five (5) days after such termination, equal to the consideration, as defined in Section 4.1, 5.2, 5.4, 5.5 and 5.6 due to Consultant for the remaining term of this Agreement and (b) any and all stock options granted to Consultant shall immediately vest, and become exercisable in accordance with their terms. Sections 5.2, 5.4, 5.5 and 5.6 shall be calculated throughout the  term based on reasonable projections in conjunction with a six month trailing average.


Force Majeure .  The inability of any Party to commence or complete its obligations hereunder by the dates required resulting from delays caused by strikes, walk-outs, insurrection, fires, floods, hurricane, freight embargoes, epidemics, quarantine restrictions, any law, act, order, proclamation, decree, regulation, ordinance or any other acts of any governmental or judicial authority, acts of God, acts of terrorists, war, emergencies, equipment failures, shortages or unavailability of materials, unavailability of necessary utilities or other similar causes beyond the Party’s reasonable control which shall have been timely communicated to the other Party, shall extend the period for the performance of the obligations for the period equal to the period(s) of any such delays(s); provided that such Party shall continue to perform to the extent feasible in view of such force majeure event.


Change in Control of the Company Defined .  The term “Change in Control of the Company” shall mean (i) the approval by the shareholders of the Company 's Parent  of a reorganization, merger, consolidation or other form of corporate transaction or series of transactions, in each case, with respect to which persons who were the shareholders of the Company immediately prior to such reorganization, merger or consolidation or other transaction do not, immediately thereafter, own more than 50% of the combined voting power entitled to vote generally in the election of directors of the reorganized, merged or consolidated company's then outstanding voting securities, or (ii) the sale of all or substantially a

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