Exhibit 10.19
CONSULTING AGREEMENT
This consulting agreement ("Agreement"), effective as of September 9, 2002, is
entered by and between Ventures-National Incorporated (dba Titan General
Holdings, Inc.), a Nevada corporation ("the Company or "Company") and ▇▇▇▇▇▇ &
▇▇▇▇▇, Inc., a Florida corporation ("Consultant").
RECITALS
WHEREAS, the Company is a public company with its shares of common stock trading
under the symbol "TTGH" on the OTC Bulletin Board in the United States; and
WHEREAS, Consultant has experience in the area of security analysis, corporate
finance, investor communications; and
WHEREAS, the Company desires to engage the services of Consultant to provide
written research coverage (by and through ▇▇▇▇▇▇ and ▇▇▇▇▇, Inc. a registered
investment advisor in good standing with the state of Florida) and consultation
with the Company in matters concerning corporate finance and investor
communications with existing shareholders, brokers, dealers and other investment
professionals, as to the Company's current and proposed activities;
NOW THEREFORE, in consideration of the premises and the mutual covenants and
agreements herein set forth, and intending to be legally bound, the Company and
Consultant agree as follows:
1. Term of Consultancy. The Company engages Consultant to act in a
consulting capacity to the Company, and Consultant agrees to provide
services to the Company commencing on the date first set forth above
and ending one year later (the "term of this Agreement").
2. Duties of Consultant. The Consultant will generally provide the
following specified consulting services (the "Services") through its
officers and employees during the term of this Agreement:
a. Provide written research coverage and reports (by and through
▇▇▇▇▇▇ and ▇▇▇▇▇, Inc. a registered investment advisor in good
standing with the state of Florida), advise and assist the
Company in developing and implementing appropriate plans and
materials for presenting the Company and its business plans,
strategy and personnel to the financial community;
b. Disseminate research regarding the Company to shareholders,
brokers, dealers and other investment community professionals
and the general investing public with which the Consultant has
existing relationships;
c. With the cooperation of the Company, revise, update and
provide summary reports (by and through ▇▇▇▇▇▇ and ▇▇▇▇▇, Inc.
a registered investment advisor in good standing with the
state of Florida) during the term of this Agreement regarding
the Company's plans, strategy, and financial data, as may
evolve during such period, and advise and assist the Company
in communicating appropriate information regarding such plans,
strategy and financial data to the financial community;
d. Assist and advise the Company with respect to its relations
with brokers, dealers, analysts and other investment
professionals;
e. Perform the functions generally assigned to security analysts,
including writing research reports, building financial models,
providing revenue and earnings estimates, setting price
targets, responding to telephone and written inquiries from
brokers, dealers, analysts and other investment professionals
(which may be referred to the Consultant by the Company);
f. Upon receipt of the Company's approval, conduct meetings in
person or by telephone, with brokers, dealers, analysts, other
investment professionals and the general investment public;
g. At the Company's request, review business plans, strategies,
mission statements, budgets, proposed transactions and other
plans for the purpose of advising the Company of the
investment community implications thereof; and
h. Otherwise perform as the Company's security analyst.
3. Allocation of Time and Energies. The Consultant will perform the
Services in a professional manner in accordance with accepted industry
standards and in compliance with applicable securities laws and
regulations. Although no specific hours-per-day requirement will be
required, the parties acknowledge and agree that a disproportionately
large amount of the effort to be extended and the costs to be incurred
by the Consultant, and the benefits to be received by the Company, are
to be expected to occur upon and shortly after, and in any event,
within two months following, the effectiveness of this Agreement. It is
explicitly understood that Consultant's performance of its duties
hereunder will in no way be measured by the price of the Company's
common stock, nor the trading volume of the Company's common stock. It
is understood that the Company is entering into this Agreement with the
understanding that ▇▇▇▇ ▇. ▇▇▇▇▇▇, CFA or ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ will be an
officer and a director of Consultant during the entire term of this
Agreement.
4. Remuneration. As full and complete compensation for Consultant's
agreement to perform the Services, the Company shall compensate the
Consultant as follows:
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a. The Company hereby agrees to issue to the Consultant an
aggregate of 100,000 shares of the Company's Common Stock (the
"Common Stock") issuable in accordance with the following
schedule: (i) 50,000 shares of Common Stock upon the execution
hereof; and (ii) 50,000 shares of Common Stock upon the
receipt by the Company of the final copy of the research
report referenced in Paragraph 2(a) hereof. Such shares of
Common Stock shall, when issued to the Consultant, be fully
paid and non-assessable. The Company understands and agrees
that Consultant has forgone significant opportunities to
accept this engagement and the Company derives substantial
benefit from the execution of this Agreement and the ability
to establish its relationship with Consultant. The shares of
Common Stock issued pursuant to clause (i) above constitute
payment for Consultant's agreement to consult with the Company
and are a nonrefundable and non-ratable retainer (with the
exception of the provisions set forth in Section 15 below).
Such shares are not a prepayment for future services. If the
Company attempts to terminate this Agreement prior to the
expiration of its term for any reason whatsoever, it is agreed
and understood that Consultant will not be requested or
demanded by the Company to return any of the Shares paid to it
hereunder.
b. All shares of the Common Stock issued pursuant to this
Agreement shall be issued in the name of Consultant. The
Company agrees that all shares of Common Stock issued to
Consultant hereunder shall carry "piggyback registration
rights" whereby such shares will be included in the next
Registration Statement filed by the Company with the
Securities and Exchange Commission ("SEC"), pursuant to which
such shares and options could be registered (other than
Registration Statements on Forms ▇-▇, ▇-▇ or other
inappropriate forms), and Company will use its best efforts to
cause such Registration Statement to be declared effective by
the SEC as soon as possible thereafter. Such Registration
Statement shall provide that Consultant may sell 20% of the
total shares of Common Stock potentially payable thereto
hereunder during each 30 day period following the effective
date of such Registration Statement. It is further agreed that
if at any time during the term of this agreement, the Company
or substantially all of the Company's assets are merged with
or acquired by another entity, or some other change occurs in
the legal entity that constitutes the Company, the Consultant
shall retain and will not be requested by the Company to
return any of the Common Stock issued to Consultant.
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c. Consultant acknowledges that the shares of Common Stock to be
issued pursuant to this Agreement (collectively, the "Shares")
have not been registered under the Securities Act of 1933 and
accordingly are "restricted securities" within the meaning of
Rule 144 of the Act. As such, the shares may not be resold or
transferred unless the Company has received an opinion of
counsel reasonably satisfactory to the Company that such a
resale or transfer is exempt from the registration
requirements of Rule 144 of the Act.
5. Finder's Fee
a. If, during the term of this Agreement, or within one-year
thereafter, any Fee Transaction(s) (as herein defined)
occur(s), then the Company shall pay to Consultant a finder's
fee (the "Fee") equal to two-and-one-half percent (2.5%) of
the Consideration (as herein defined).
b. The term "Fee Transaction" means any investment made directly
or indirectly in, or debt financing provided to or for the
benefit of, the Company or its shareholders by any third party
originally introduced by Consultant to the Company during the
term of this Agreement and not previously known to the Company
or its consultants. The term "Consideration" means the
aggregate amount of cash and the fair market value (on the
date of payment) of securities or assets received by, or for
the benefit of, the Company or its shareholders in connection
with a Fee Transaction. "Consideration" includes, but is not
limited to, the total fair market value of (a) cash,
securities, assets and other tangible property received by the
Company or its shareholders in a Fee Transaction, or
distributable to the Consultant or its shareholders upon
liquidation or dissolution of the Consultant following a Fee
Transaction, (b) any amounts payable to the Company or its
shareholders under any non-compete agreement or other
agreements entered into in connection with a Fee Transaction,
and (c) any compensation payable to any shareholder of the
Company under any employment or consulting contract entered in
connection with a Fee Transaction but only to the extent such
compensation exceeds the then-current compensation of such
shareholder.
c. If the Consideration shall consist entirely of cash paid at
the closing of a Fee Transaction, the fee payable to
Consultant shall be paid to Consultant upon such closing. To
the extent the Consideration is paid at closing and consists
wholly or partially of stock, other securities or other
property (other than cash), the Company shall use its
reasonable best efforts to make a cash payment to Consultant
at closing, equivalent to the "Fair Value" of such
Consideration, defined as the fair value to be agreed upon
between Consultant and the Company and taking into account
appropriate discounts for any applicable holding periods,
volume, contractual, legal or other limitations or
restrictions on sale or transfer, "blockage discounts" or any
other limitations or restrictions on alienation with respect
to any such stock, other securities or other property;
however, if such valuation is not feasible or practicable, or
if such fair value is not agreed upon, a portion of Fee may be
paid to Consultant in the same form (i.e., stock, other
securities or other property) and in the same proportions in
which the Consideration is received by the Company or its
stockholders, as the case may be.
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d. If the Consideration shall consist entirely of cash, but the
payment(s) of all or any portion(s) of the Consideration shall
be deferred and shall not be made until after closing of a Fee
Transaction, the Company may, in its discretion, pay to
Consultant the Fee on the same pro rata basis and at the same
time or times as the Consideration is received by the Company
or the Company's stockholders (as the case may be). If any of
the deferred payment(s) of the Consideration consists wholly
or partially of stock, other securities or other property
(other than cash), then with respect to each such payment, the
Company shall use its best efforts to make a cash payment to
Consultant equivalent to the Fair Value of such Consideration;
however, if such determination of Fair Value is not feasible
or practicable or if such Fair Value is not agreed upon, a
portion of the Fee may be paid to Consultant in the same form
(i.e., stock, other securities or other property) at the same
time and in the same proportion in which the Consideration is
received by the Company or its stockholders, as the case may
be.
e. Notwithstanding all of the foregoing provisions of this
Section Five (5), in lieu of payment of portions of the Fee as
the Consideration is so received, the Company may, at its
option, pay to the Consultant the entire Fee in cash at
closing, discounted to take into account the reasonably
projected rate of inflation, and the period over which the
Consideration is to be received, the then-generally-prevailing
interest rate for unsecured debt obligations for such period
of time of corporate borrowers of the highest credit standing,
and, if applicable, the factors set forth in Section Five,
paragraph c, with regard to Consideration in the form of
stock, other securities or other property.
f. The Fee payable to Consultant will be in addition to any fees
payable by the Company to any other intermediary, if any,
which shall be per separate agreements negotiated between the
Company and such other intermediary. In reference to the
Company procuring financing sources and acquisition and merger
candidates through Consultant which qualify as a Fee
Transaction, it is specifically understood that Consultant is
not nor does it hold itself out to be a Broker/Dealer or
investment adviser, but rather merely a "Finder".
g. It is further understood that the Company, and not Consultant,
is responsible to perform any and all due diligence on any
lender, equity purchaser or acquisition/merger candidate
introduced to it by Consultant under this Agreement, prior to
the Company receiving funds or closing on any acquisition.
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h. Consultant will notify the Company of introductions it makes
for potential sources of financing or acquisitions in a timely
manner (within three (3) days of each introduction). If the
Company has a preexisting relationship with such nominee and
believes such party should be excluded from the Agreement,
then the Company will notify Consultant immediately of such
circumstances via facsimile memo ("fax").
6. Expenses. Consultant agrees to pay for all its expenses (phone, labor,
etc.), other than extraordinary items which the Company may agree to
reimburse Consultant. Such extraordinary items include travel and
entertainment required by/or specifically requested by the Company,
luncheons or dinners for large groups of investment professionals, mass
faxing to a sizable percentage of the Company's constituents, investor
conference calls, print advertisements in publications, and like
expenses approved by the Company prior to its incurring an obligation
for reimbursement.
7. Indemnification.
a. The Company agrees to indemnify and hold harmless Consultant,
its officers, directors, employees, affiliates and agents
harmless from and against any and all losses, claims, damages
and liabilities, related to or arising out of any breach by
the Company of its obligations under this Agreement and/or the
Company's actions in connection with the transactions and/or
activities contemplated herein.
b. Consultant agrees to indemnify and hold harmless Company, its
officers, directors, employees, affiliates and agents harmless
from and against any and all losses, claims, damages and
liabilities, related to or arising out of any breach by
Consultant of its obligations under this Agreement and/or the
Consultant's actions in connection with the transactions
and/or activities contemplated herein.
8. Representations. The Company warrants and represents that all oral
communications, written documents or materials furnished to Consultant
are accurate in all material respects, and the Consultant warrants and
represents that all communications by Consultant with the public, with
respect to the financial affairs, operations, profitability and
strategic planning of the Company, will be in accordance with
information provided to it by the Company. The Consultant may rely upon
the accuracy of the information provided by the Company without
independent investigation. Consultant represents that it is not
required to maintain any licenses and registrations under federal or
any state regulations necessary to perform the Services set forth
herein. Consultant acknowledges that to the best of its knowledge, the
performance of the Services will not violate any rule or provision of
any regulatory agency having jurisdiction over Consultant. Consultant
acknowledges that to the best of its knowledge, Consultant and its
officers and directors are not the subject of any investigation, claim,
decree or judgment involving any violation of the SEC or securities
law. The Company acknowledges that to the best of its knowledge that it
has not violated any rule or provision of any regulatory agency having
jurisdiction over the Company. The Company also acknowledges that, to
the best of its knowledge, the Company is not the subject of any
investigation, claim, decree or judgment involving any violation of the
SEC or securities laws.
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9. Status as Independent Contractor. Consultant's engagement pursuant to
this Agreement shall be as independent contractor, and not as employee,
officer or other agent of the Company. Neither party to this Agreement
shall represent or hold itself out to be the employer or employee of
the other. Consultant further acknowledges the consideration provided
hereinabove is a gross amount of consideration and that the Company
will not withhold from such consideration any amounts as to income
taxes, social security payments or any other payroll taxes. All such
income taxes and other such payment shall be made or provided for by
Consultant and the Company shall have no responsibility or duties
regarding such matters. Neither the Company nor the Consultant
possesses the authority to bind each other in any agreements, without
the express written consent of the entity to be bound.
10. Attorneys' Fees. If any legal action(s) or any arbitration or other
proceeding(s) is brought for the enforcement or interruption of the
Agreement, or because of alleged dispute, breach, default or
misrepresentation in connection with or related to this Agreement, the
successful or prevailing party shall be entitled to recover reasonable
attorney's' fees and other reasonable costs in connection with that
action(s) or proceeding(s), in addition to any other relief to which
they may be entitled.
11. Waiver. The waiver by either party of a breach of any provision of this
agreement by the other party shall not operate or be construed as a
waiver of any subsequent breach by such other party.
12. Notices. All notices, requests, and other communications hereunder
shall be deemed to be duly given if sent by U.S. mail, postage prepaid,
addressed to the other party at the address set forth herein below:
Company Address: Consultants Address:
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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Either party may change address, to which notices for it shall be
addressed by providing notice of such change to the other party, in the
manner set forth in this paragraph.
13. Choice of Law, Jurisdiction and Venue. This Agreement shall be governed
by, construed and enforced in accordance with the internal laws of the
State of Florida, without giving effect to its conflict of laws or
choice of law principles.
14. Arbitration. Any controversy or claim arising out of or relating to
this Agreement, or the alleged breach thereof, or relating to
Consultant's activities or remuneration under this Agreement, shall be
settled by binding arbitration in West Palm Beach, Florida, in
accordance with the applicable rules of the American Arbitration
Association, and judgment on the award rendered by the arbitrator(s)
shall be binding on the parties and may be entered in any court having
jurisdiction.
15. Due Diligence Period. The Consultant retains the right to terminate
this Agreement for thirty (30) days from the effectiveness of this
Agreement while Consultant completes due diligence. Consultant
explicitly understands that all Common Stock or any other compensation
received by the Consultant from the Company will be forfeited and
returned to the company within five (5) days of written termination of
the Agreement.
16. Right to Change Opinion. It is explicitly understood that forecasts,
price targets and ratings are based heavily upon timely information
supplied by the Company that is deemed to be realistic and accurate.
Consultant reserves the right to revise their opinion regarding, but
not limited to, revenue projections, income projections, price targets
or rating in light of new information or if any prior information is
found to be inaccurate or misleading. It is further agreed that
Consultant reserves the right to revise their opinion regarding, but
not limited to, revenue projections, income projections, price targets
or rating in light of any significant or material change in the Company
including, but not limited to, excessively dilutive financing, change
in business model, merger, acquisition or change in management.
17. Complete Agreement. This Agreement contains the entire agreement of the
parties relating to the subject matter hereof. This Agreement and its
terms may not be changed orally, but only by an agreement in writing
signed by the party against whom enforcement of any waiver, change,
modification, extension or discharge is sought.
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AGREED TO:
"The Company" Titan General Holdings, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Dated: 09/10/02 By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇ ▇▇▇▇▇▇
President and C.E.O.
and Its Duly Authorized Officer
"Consultant" ▇▇▇▇▇▇ & ▇▇▇▇▇, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Dated: 9/9/02 By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇
C.E.O.
and Its Duly Authorized Officer
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