Command Security Corporation
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▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
February 3, ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ Capital Consulting LLC
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇-▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Dear ▇▇. ▇▇▇▇▇▇:
This letter agreement (this "Agreement") will serve to confirm the agreement
between Command Security Corporation (the "Company"), and Jericho State Capital
Consulting LLC ("Consultant") regarding the engagement of Consultant by the
Company, on a non-exclusive basis, commencing upon, and subject to, the
execution of that certain agreement (the "▇▇▇▇▇▇▇▇ Agreement") dated the date
hereof between the Company and ▇▇▇▇▇▇▇▇ Security & Safety LLC ("GSS") (relating
to the creation of a consulting relationship between the Company and GSS).
Therefore, in consideration of the foregoing and of the mutual agreements,
undertakings, representations and warranties contained in this Agreement, the
parties hereby agree as follows:
1. Consultant's Fee. In consideration of the introduction by the
Consultant of the Company to GSS, the Company shall on the date hereof grant to
Consultant a warrant (the "Initial Warrant") that entitles the Consultant to
purchase an aggregate of three hundred fifty thousand (350,000) shares of the
Company's common stock, par value $0.0001 per share ("Common Stock"), at a price
of $2.00 per share (subject to adjustment as provided in such Consultant's
Warrant). The Consultant's Warrant shall vest immediately in full upon the
execution and delivery of the ▇▇▇▇▇▇▇▇ Agreement by the parties thereto, and
shall be substantially in the form attached hereto as Exhibit A. In the event
that the ▇▇▇▇▇▇▇▇ Agreement is extended for an additional one-year period
following the initial 12-month term thereof (the "Initial Term") or the Company
and GSS otherwise enter into another commercial relationship following the
Initial Term under another agreement with a term of at least 12 months following
the Initial Term, then, commencing on the first anniversary of the ▇▇▇▇▇▇▇▇
Agreement, the Company shall grant the Consultant an additional warrant (the
"Additional Warrant") to purchase one hundred fifty thousand shares (150,000) of
Common Stock at a price of $2.00 per share (subject to adjustment as provided in
such Consultant's Warrant). The shares of Common Stock underlying the Initial
Warrant and the Additional Warrant (if granted) shall be entitled to certain
"piggyback" registration rights pursuant to a customary Registration Rights
Agreement.
2. Ongoing Services. Consultant will use best efforts to: (i) familiarize
itself with the business, operations, financial condition, and prospects of the
Company; and (ii) endeavor to identify and introduce one or more Target
Companies (as defined below) to the Company with whom the Company and any such
Target Company may have an interest in engaging in an Acquisition Transaction.
Prior to contacting a Target Company, Consultant will provide the Company with
notice of the name and such other information as the Company shall reasonably
request regarding such Target Company, and if the Company so requests,
Consultant shall not initiate discussions with such Target Company and such
Target Company shall not be considered a "Target Company" for purposes of this
Agreement. An "Acquisition Transaction" shall mean any transaction or series or
combination of transactions, other than in the ordinary course of trade or
business, whereby, directly or indirectly, control of or an interest in a Target
Company in the security industry or any of its businesses, stock or assets is
transferred to the Company or any of its affiliates. A "Target Company" shall
mean any company in the security industry that the Company seeks to acquire in
an Acquisition Transaction. In addition, Consultant will use its best efforts to
interface with GSS in connection with services that GSS will be providing to the
Company and Consultant shall serve as a liaison between GSS and the Company in
order to update each with respect to each other's activities, opportunities and
developments as relates to the services to be performed by GSS under its
agreement with the Company. In consideration of these services, the Company
shall pay to Consultant a fee equal to ninety thousand dollars ($90,000) upon
execution of this Agreement. Further, in the event the ▇▇▇▇▇▇▇▇ Agreement is
extended, or the Company and GSS otherwise enter into another commercial
relationship following the Initial Term, the Company shall pay the Consultant
monthly installments of seven thousand five hundred dollars ($7,500) on the
first business day of each month that the ▇▇▇▇▇▇▇▇ Agreement is so extended (or
during the period of such other commercial relationship), but in no event shall
such payments continue for more than 31 months from the initial execution date
of the ▇▇▇▇▇▇▇▇ Agreement (or provide for payments in the aggregate of more than
an additional $135,000), after which time all payment obligations of the Company
to Consultant hereunder shall terminate).
3. Information. The Company agrees to furnish to Consultant, upon
Consultant's request, all reasonable information and data concerning the Company
(the "Information") which Consultant reasonably deems appropriate and necessary
for purposes of rendering his services hereunder, and will provide Consultant
with access to officers, directors, employees and advisors of the Company at
reasonable times and upon reasonable advance notice.
4. Representations and Warranties. (a) Each of Consultant and the Company
represent and warrant to the other: (i) that such party has full power and
authority to execute and deliver this Agreement and to perform its obligations
hereunder; (ii) that such party has taken all necessary action to authorize the
execution, delivery and performance of this Agreement; (iii) that this Agreement
constitutes a valid and binding obligation, enforceable against such party in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally; and (iv) that such party
does not need to obtain any authorizations, approvals, consents or licenses from
any regulatory body or authority for the valid execution or delivery of this
Agreement or, if so required, all such authorizations, approvals, consents or
licenses have been obtained and are in full force and effect.
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(b) In connection with the issuance to Consultant of the Initial Warrant
and, if applicable, the Additional Warrant, and any exercise thereof, Consultant
represents and warrants to the Company that Consultant: (i) is an "accredited
investor" as defined in Rule 501 under the Securities Act of 1933, as amended
(the "Act"), and has sufficient knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of an
investment in the Company; (ii) will acquire the Consultant's Warrant and the
underlying shares of Common Stock (collectively, the "Fee Securities") for its
own account and not for any other person or entity, for investment only and with
no intention of distributing or reselling (and he will not distribute or resell)
such Fee Securities or interest therein, in any transaction that would violate
the Act, or state securities laws; and (iii) has no binding contract,
undertaking, agreement or arrangement with any person to sell, transfer or
pledge to such person the Fee Securities, or any interest therein, and
Consultant has no present plans to enter into any such contract, undertaking,
agreement or arrangement.
5. Legal Compliance. Consultant hereby covenants, represents and warrants
that at all times: (i) Consultant's services for the Company have been and will
be performed in strict compliance with the laws of the United States, including
the Act and the Securities Exchange Act of 1934, as amended, the laws of any
country or state in which Consultant engages in any activity pursuant to this
Agreement, and the Company's instructions, policies and procedures as provided
to Consultant from time to time and (ii) without limiting the generality of the
foregoing, when providing services hereunder, Consultant will engage in no act
or practice that would, directly or indirectly, constitute a general
solicitation or general advertising for purposes of Regulation D under the Act.
6. Indemnification. The Company, on the one hand, and Consultant, on the
other hand, each agree to indemnify, defend and hold harmless the other and
their respective directors, officers, partners, stockholders, employees, agents,
advisors (including, without limitation, financial advisors, counsel and
accountants) and controlling persons (collectively "Representatives"), from and
against any and all losses, claims, damages, liabilities or expenses (including
reasonable attorney's fees and expenses) (collectively "Losses") incurred by the
indemnified party insofar as such Losses arise out of or relate to a breach of
any of the representations, warranties or covenants of the indemnifying party
hereunder; provided, however, that the indemnifying party shall not be liable if
any Losses resulted primarily from the gross negligence or willful misconduct of
the indemnified party. The preceding indemnification provisions shall survive
the termination of this Agreement.
7. Term. The term of this Agreement shall commence on the date hereof and
shall terminate upon the earlier to occur of (i) termination of the ▇▇▇▇▇▇▇▇
Agreement or (ii) thirty-one (31) months following the effective date of the
▇▇▇▇▇▇▇▇ Agreement. Neither termination nor completion of this Agreement shall
affect the indemnification or confidentiality provisions contained herein.
8. Notices. Any notice or other communication required or permitted to be
given hereunder shall be in writing and shall be mailed by certified mail,
return receipt requested, or by Federal Express, Express Mail or similar
overnight delivery or courier service or delivered (in person or by telecopy,
telex or similar telecommunications equipment) against receipt to the party to
whom it is to be given to the address of such party set forth above.
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9. Parties. This Agreement shall inure solely to the benefit of and shall
be binding upon, the parties and their respective successors and designated
assigns and, except as otherwise specifically provided for herein, no other
person shall have or be construed to have any legal or equitable right, remedy
or claim under or in respect of or by virtue of this Agreement.
10. Confidential Information. The parties acknowledge and agree that in
connection with this Agreement, the Company or its Representatives, may disclose
Confidential Information (as defined below) to Consultant or its
Representatives. For purposes of this Agreement, the term "Confidential
Information" means the operations and business prospects of the Company and any
information, ideas, concepts, strategies, data or know-how of the Company or its
Representatives, that has previously been or will hereinafter be disclosed
(whether written or oral) by the Company or its Representatives to Consultant or
its Representatives in connection with this Agreement, including, without
limitation, the Information. Confidential Information does not include
information, ideas, concepts, strategies, data or know-how that: (i) are in the
possession of Consultant at the time of disclosure; (ii) are approved in writing
for public release by the Company; (iii) were rightfully received by Consultant
from third parties under no duty to keep it confidential; (iv) were
independently developed by Consultant; or (v) are or become generally available
to the public other than as a result of a disclosure by the Company or its
Representatives in violation of this Agreement. Consultant, on behalf of itself
and its Representatives, agrees: (i) not to use any Confidential Information
disclosed to it for its own use or for any other purpose except to carry out
discussions concerning this Agreement and (ii) to take all reasonable steps to
protect the secrecy of and avoid disclosure or use of the Confidential
Information by Consultant and its Representatives.
11. Relationship. Nothing in this Agreement is intended by the parties to
create any fiduciary relationship among them, nor to constitute any of them an
agent, legal representative, subsidiary, joint venturer, partner, employee or
servant of the other for any purpose. With respect to all matters relating to
this Agreement, the Consultant shall be deemed to be an independent contractor
and shall bear his own expenses in connection with this Agreement.
12. Governing Law; Jurisdiction. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of New York
without giving effect to choice of law or conflicts of laws principles. The
state and federal courts located in the Southern District of the State of New
York, New York County shall have jurisdiction over any and all disputes arising
out of or relating to this Agreement.
13. Counterparts. This Agreement may be executed in any number of
counterparts, including confirmed fax transmission, each of which shall be
deemed to be an original, and both of which taken together shall be deemed to be
one and the same instrument.
14. Entire Agreement; Binding Nature. This Agreement: (i) constitutes the
entire agreement of the parties hereto with respect to the subject matter hereof
and supersedes any prior agreement or understanding in effect prior to the date
hereof, if any, and (ii) shall be binding upon and inure solely to the benefit
of each party hereto and its successors and permitted assignees, heirs, personal
representatives and estate and nothing in this Agreement, express or implied, is
intended to or shall confer upon any other person any rights, benefits or
remedies of any nature whatsoever under or by reason of this Agreement.
15. Assignment; Beneficiaries. This Agreement may not be assigned by any
party without the prior written consent of the other party. Except as expressly
provided in Section 6 hereof: (i) this Agreement is solely for the benefit of
the parties hereto and (ii) no provision hereof shall create any right for any
person not a party hereto, their successors and permitted assigns.
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16. Severability. If any provision of this Agreement shall be held to be
illegal, invalid or unenforceable under any applicable law, then such provision
shall be deemed modified to the extent necessary to render it legal, valid and
enforceable, and if no such modification shall render it legal, valid and
enforceable, then this Agreement shall be construed as if not containing such
provision, and the rights and obligations of the parties shall be construed and
enforced accordingly.
17. Waiver, Modification or Amendment. No waiver, modification or
amendment of any provision of this Agreement shall be effective, binding or
enforceable unless in writing and signed by the party against which it is sought
to be enforced.
If the above description of our understandings is agreeable to Consultant,
please so indicate by executing this Agreement in the designated space below.
Very truly yours,
COMMAND SECURITY CORPORATION
By:
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
President and Chief Fiinancial Officer
Agreed to and accepted as of this __ day of February, 2006:
JERICHO STATE CAPITAL CONSULTING LLC
By:
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