BUSINESS ADVISORY AGREEMENT
Signal Capital Partners and Accupoll Holding Corp.
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This Business Advisory Agreement ("Agreement") dated this 1st day of
April, 2003, is entered into by and between Signal Capital Partners ("Advisor"),
and Accupoll Holding Corp. a public company incorporated in the state of Nevada
("Company" or "ACCUPOLL"). Advisor and Company may each be referred to as a
"Party" and together Advisor and Company may be referred to as the "Parties".
WHEREAS, Company desires to obtain strategic planning services, merger
and acquisition consulting, create an investor awareness campaign, be introduced
to sources of additional financing, and create a business development program to
accomplish a more rapid development of the company;
WHEREAS, Company wishes to engage Advisor to complete a thorough
evaluation of Company's business opportunities, financing opportunities and
business development programs for various companies of interest to ACCUPOLL, and
provide recommendations about various courses of action;
NOW THEREFORE, in consideration of the promises and covenants contained herein,
the Parties hereto agree as follows:
1. RESPONSIBILITIES OF ADVISOR. Advisor agrees to become a management consultant
to Company with respect to the evaluation of current business development
programs, growth strategies, financing opportunities, and stock awareness and
investor relations programs, and make recommendations as to possible ways to
focus the assets and management resources of the Company to achieve long-term
growth. Advisor will complete an analysis of current operation and management
structures. Advisor will work with management to evaluate all strategic plans
and evaluate the current capabilities of Company in view of its organization and
resources. In addition, Advisor will continue in the role of business
development for Company. It is understood that this program of business
development may involve the Company in possible business combination or joint
venture transactions. Advisor shall provide Company with his opinion and
recommendations with respect to the most appropriate means of meeting corporate
goals; however, the implementation of such recommendations shall be at the sole
and exclusive option of Company.
2. ANALYSIS AND REVIEW. Advisor agrees to provide the following services, and
such other advisory services as may be appropriate and required to assist in
Company's efforts to meet the corporate goals:
A. Conduct summary due diligence and analysis of all corporate
structuring and develop the complete strategy for operations and completing the
Program ("Recommendation"). Such analysis shall include a critical evaluation of
the information and documents delivered to Advisor by Company prior to
implementation of any revision of a focused business development and financing
program, and
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Advisory Agreement
B. Provide Company with a formal recommendation for implementation of
the program.
3. PROGRAM IMPLEMENTATION. Upon receipt of formal approval and written
authorization from Company to proceed with the Program, Advisor shall:
A. Advise Company with respect to a plan to find business partners;
B. Provide an analysis of possible strategic alliances;
C. Provide a program for fulfilling the financing needs of the company;
D. Create systems for evaluating possible alliance candidates; and
E. Assist Company wherever possible with the implementation of each of
the above-enumerated steps.
F. Create and coordinate an intensive Investor and Financial Relations
program for the company, designed to strengthen and optimize the
company's share price and market capitalization, and daily common
stock trading volumes.
4. RESPONSIBILITIES OF COMPANY. In connection with the above activities, which
will be undertaken by Advisor on Company's behalf, Company shall fully cooperate
with the Advisor in the fulfillment of its duties hereunder, and Company and
Advisor agree to the following:
A. RELATIONSHIP. Advisor is an independent contractor of Company and
will act as an advisor to Company in accordance with this Agreement. Advisor
acknowledges and agrees that it is his responsibility to provide all employment
taxes, insurance premiums and local, state and federal taxes related to this
Agreement. Neither FICA (Social Security), FUTA (Federal Unemployment), nor
local, state or federal income taxes will be withheld from payments to Advisor.
This provision shall also apply to all employees and agents of Advisor.
B. ACCESS TO INFORMATION. Furnish all non-privileged information and
data concerning Company, any transactions or prior transactions which Advisor
may request.
C. ACCESS TO COMPANY OFFICERS AND PROFESSIONALS. Company will provide
Advisor complete access to Company's officers, directors, employees,
accountants, counsel and other key persons.
5. TERM. The term of this Agreement shall be for a period of twelve (12) months,
commencing on the date first set forth above.
6. TRUTHFUL REPRESENTATIONS. Company represents and warrants that all
information (a) made available to the Advisor, or (b) contained in any materials
prepared by Company will, at all times during this engagement be true, accurate
and complete in all material respects and will not contain any untrue statement
of a material fact or omit to state therein any fact necessary to make the
statements therein not misleading in light of the circumstances under which they
are made. Company further represents that any projections provided to Advisor or
contained in any materials prepared by or on behalf of Company with respect to
the subject matter thereof will have been prepared in good faith and will be
based on assumptions which in light of the circumstances under which they are
made are in Company's determination, reasonable.
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7. RESPONSIBILITY FOR REPRESENTATIONS. Company acknowledges and agrees that in
rendering its services as agreed hereunder, Advisor will be using and relying on
the information (and information available from public sources and other sources
deemed to be reliable) without independent verification thereof and without
independent appraisal of any of Company's assets. Advisor does not assume
responsibility for the accuracy or completeness of the information. Any advice
rendered by Advisor pursuant to this Agreement may not be disclosed publicly
without Company's prior written consent.
8. INDEMNIFICATION OF ADVISOR. If in connection with the services or matters
that are the subject of this Agreement Advisor becomes involved in any capacity
in any action or legal proceeding, due to the actions, information, position,
assertions, and/or affirmations put forth by Company or by Advisor at the
direction of Company, or in reliance upon material or information furnished by
Company, Company agrees to indemnify and hold harmless Advisor as the case may
be for the reasonable legal fees of counsel, court costs and other expenses
(including the costs of investigation and preparation) incurred. Company also
agrees to hold harmless Advisor against any losses, claims, damages or
liabilities, joint services or matters which are the subject of this Agreement;
provided however that Company shall not be liable to Advisor with respect to any
loss, claim, damages or liability to the extent and only to the extent that such
loss, claim, damage or liability resulted from the gross negligence or willful
misconduct of Advisor. The provisions of this paragraph shall survive the
expiration of the period of this Agreement including any extensions thereof set
forth herein.
9. IMPLEMENTATION OF PROGRAM. In the event that Company provides Program
Authorization to Advisor, Company agrees, subject to its resources, to:
A. Allocate the services of its Chief Executive Officer, Chief
Financial Officer and engage such other outside professionals
as required to successfully implement and complete each task
associated with the Program, pursuant to Advisor's
recommendation, unless modified in writing by the mutual
consent of the parties, and
B. Issue such compensation as may be suggested by Advisor so as
to cause timely implementation of the Program pursuant to
Advisor's recommendation, unless modified in writing by the
mutual consent of the parties.
10. COMPENSATION. In consideration for the services which are to be provided by
Advisor under this Agreement, Company agrees to compensate Advisor as follows:
A In addition, upon the execution hereof, Company will issue, to
Advisor, warrants to purchase 1,000,000 shares of ACCUPOLL
common stock for Advisor's business development services,
financing services, merger and acquisition evaluations, and
strategic planning services. Company will issue these warrants
all in advance and upon the execution hereof, The warrants
shall include provision for cashless exercise, and shall be
outstanding for a term of three(3) years from the date of
issuance, and shall be exercisable at a price of seventy five
(75) cents per share.
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B. Advisor will introduce Company to a suitable business
development team as part of its services, however Advisor will
receive no compensation for their services which will be
independent of the services provided under this agreement
D. ACCUPOLL or its affiliates will pay a finders fee of 10% of
all money received by ACCUPOLL or any of its affiliates or
successors to business for equity capital received from any
entity or person introduced DIRECTLY by the Advisor to the
Company, its officers or directors, employees, shareholders or
affiliates.
E. Compensation for Merger or Acquisition
(i) Cash Compensation: If a purchase, merger, or combination is
consummated between the Client and a party introduced to
Client by Agent, Agent shall be paid a commission (the
"Commission") by the Client of ten percent (10%) of the total
of all money invested in the common stock or equity
equivalents (including but not limited to convertible notes,
preferred stock or convertible preferred) of the company or
any of its subsidiaries as part of or as a direct result of
the transaction. A fee of ten percent (10%) will be due the
Agent on any cash or cash equivalents held by the publicly
traded company and made available to the Client as a result of
the transaction. A fee of 7% will be paid on any money
provided to the company or its subsidiaries in the form of
non-equity notes.
(ii) Equity Compensation: Warrants:
Client shall grant the Agent Warrants to purchase common stock
of the parent publicly traded company. The number of Warrants
shall equal the total amount of investment funds, cash or
equivalents made available to Client as a result of a
transaction divided by the 15 day average price of any shares
issued to complete the business combination and that number
divided by 10. The Warrants will be cashless exercisable for
common stock with an exercise price set at the time of closing
based on the 30 day average closing price preceeding the close
of the transaction.
(iii) In kind Compensation: If there is compensation paid in other
than cash, referred to herein as "In Kind" in a transaction
that Agent has introduced to Client, then Agent shall receive
an "In-Kind" fee equal to Seven percent (7%) of the total
compensation in the same ratio as the consideration received
by our issued in any business combination occurring as a
result of the Agents direct or indirect introduction. Client
in the transaction. "In kind" means that if the Client
receives cash, Agent receives its cash fee as described above;
if Client receives stock of the purchaser or if stock, Agent
receives stock of the purchaser, and so on.
(iiii) Total Consideration. For the purpose of calculating fees Total
Consideration will include cash, securities, or notes payable
to Client or compensation packages made to officers of the
company or its 5% or more shareholders received by Client and
its affiliates. Total consideration will not include debt
assumed by purchaser or any other liabilities or obligations
assumed by purchaser.
(iv) Payment of Agent's Compensation.
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On any Equity Compensation earned by the efforts of Agent or
any fee due to Agent shall be payable on the date of
acquisition or closing from an escrow trust account designated
by Agent and acceptable to Client. No Commission shall be
payable if a sale, merger, or combination is not consummated,
regardless or whether or not the failure to consummate is due
to the fault of Client or its shareholders or for any other
reason.
For Commission payable in cash, Agent shall be paid via wire
transfer in immediately available funds to the account(s)
designated by the AGENT as submitted to and directed by the
designated administrator of the escrow account. For Commission
payable in stock or warrants, the Client shall send the stock
shares and/or warrants to Agent concurrent with the closing of
the Transaction to the addresses listed above. For any shares
that can be delivered electronically, the Agent will provide
specific brokerage account information to the designated
administrator of the trust account to facilitate the delivery
of the shares via DTC transfer. No Commission shall be payable
unless Agent obtains written acknowledgement by Client that
the Introduced Party was "first introduced" by Agent. For
purposes hereof, "Introduced Party" shall mean an introduced
public company listed on Schedule A attached hereto and
approved in writing by Client.
11. EXPENSES. Upon demand, but no more than monthly, Company shall reimburse
Advisor for all of his reasonable out of pocket expenses incurred in connection
with the performance of his services pursuant to this Agreement. Such expenses
shall include, but not be limited to travel, lodging, research, entertainment,
printing, postage and similar charges. Advisor agrees that it shall obtain
authorization from Company prior to incurring any expense in excess of Two
Hundred and Fifty Dollars ($250.00). From time to time, Advisor may request, and
Company will not unreasonably refuse, an advance on certain quantifiable and
approved expenses over a certain amount.
12. CONFIDENTIALITY. Except to the extent necessary to perform its obligations
hereunder or to comply with any applicable law, regulation or rule, neither
Party shall disclose or divulge to any third party other than the other Party's
directors, officers, auditor or legal advisors, either before or after the
termination of this Agreement, any document or information exchanged between the
Parties during the term of this Agreement without prior written consent of the
other Party, which consent shall not unreasonably withheld.
13. USE OF ADVICE AND RECOMMENDATIONS. Neither the Recommendations or any
advice, whether oral or in writing, and no other material prepared for Company
in connection with Advisor's services hereunder is to be used for any purpose
other than the purpose for which such report, advice or material was prepared,
or is to be used or referred to by Company in any public documents or otherwise
publicly referred to without Advisor's written consent. Notwithstanding the
foregoing, in the event that Company receives a request to disclose all or any
part of the information contained in any such report, advice or material under
the terms of a valid and effective subpoena or order issued by a court of
competent jurisdiction, Company may disclose such information provided that
Company notifies Advisor of the existence, terms and circumstances surrounding
such request.
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14. NON-CIRCUMVENTION. Company hereby irrevocably agrees not to circumvent,
avoid or bypass Advisor, either directly or indirectly. Company will not
directly use or approach Advisor's associates, contacts or introductions in
order to avoid payments of fees to Advisor, or otherwise benefit, either
financially or otherwise, from information supplied to it or individuals and or
business entities introduced to it by Advisor with regard to any business
opportunity, business combination or joint venture under discussion. The spirit
of mutual trust and confidence shall be the underlying principle of this
undertaking, and the Parties agree to adhere thereto.
15. TERMINATION BY ADVISOR. It is hereby agreed and understood that Advisor
shall have the right to interview Company and accomplish a due diligence review
with respect to Company's representations and that at Advisor's sole discretion
if such interviews and due diligence demonstrate substantive and/or material
discrepancies from that which was put forth by the Company then Advisor shall
have the right to terminate this Agreement and be held harmless from any claims
of Company for such termination as well as from any claims of third parties
which may result from any such discrepancy. In the event that Advisor is unable
to perform its responsibilities under this Agreement due to the failure of
Company to perform its responsibilities hereunder, Advisor shall be released
from its responsibilities under this Agreement and shall receive any
compensation due and owing pursuant to Paragraph 10 above.
16. TERMINATION BY COMPANY. Notwithstanding Paragraph 5, Company may terminate
this Agreement at any time after 60 days, without cause, upon sixty (60) days'
written notice to Advisor. In the event that Company terminates Advisor without
cause prior to the expiration of the term set forth in Paragraph 5, Advisor
shall be entitled to all compensation owing as set forth in Paragraph 10. In the
event that at time of such termination Company shall be in discussions with
respect to any persons or entities introduced by Advisor, Advisor will maintain
the exclusive right to conclude any transactions between Company and such
persons or entities. In case of termination, regardless of when or by whom such
termination may have been brought about, Advisor will receive full reimbursement
for the entire amount of expenses incurred by Advisor in connection with his
services pursuant to Paragraph 11 of this Agreement. Neither termination nor
completion shall affect the provisions of Paragraphs 6, 7, 8, 11, 12, 13 or 14,
which shall remain operative and in full force and effect for a period of two
years subsequent to termination.
17. SECURITIES LAWS. The Parties to this Agreement mutually agree to comply with
any and all applicable securities laws with respect to their performance under
this Agreement.
18. SERVICES NON-EXCLUSIVE. Company understands and agrees that while we shall
divert the necessary time and effort to provide the services defined herein, we
are engaged in other business activities of a similar nature on behalf of other
clients and therefore our time and services are not exclusive to the Company.
19. MISCELLANEOUS PROVISIONS.
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A. NOTICES. All notices, requests, demands and other communications to
be given hereunder shall be in writing and shall be deemed to have been duly
given on the date of personal service or transmission by fax if such
transmission is received during the normal business hours of the addressee, or
on the first business day after sending the same by overnight courier service or
by telegram, or on the third business day after mailing the same by first class
mail, or on the day of receipt if sent by certified or registered mail,
addressed as set forth below, or at such other address as any party may
hereafter indicate by notice delivered as set forth herein. Notice shall be
given to Advisor as follows: ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇. Notice shall be given to ACCUPOLL as follows : C/0 ▇▇▇▇▇▇
▇▇▇▇▇▇, Chairman, Accupoll Holding Corp, ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇.
B. BINDING AGREEMENT; ASSIGNMENT. This Agreement shall constitute the
binding agreement of the Parties hereto, enforceable against each of them in
accordance with its terms. This Agreement shall inure to the benefit of each of
the Parties hereto, and their respective successors and permitted assigns.
C. ENTIRE AGREEMENT. This Agreement constitutes the entire and final
agreement and understanding between the Parties with respect to the subject
matter hereof and the transactions contemplated hereby.
D. WAIVER. No waiver of any provision of this Agreement shall be deemed
to be or shall constitute a waiver of any other provision, whether or not
similar, nor shall any waiver constitute a continuing waiver. No waiver shall be
binding unless executed in writing by the Party making the waiver.
E. HEADINGS. The headings provided herein are for convenience only and
shall have no force or effect upon the construction or interpretation of any
provision hereof.
F. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
G. FURTHER DOCUMENTS AND ACTS. Each party agrees to execute such other
and further documents and to perform such other and further acts as may be
reasonably necessary to carry out the purposes and provisions of this Agreement.
H. GOVERNING LAW & VENUE. This Agreement shall be governed by and
construed in accordance with the laws of the State of California, without giving
effect to the principles of conflicts of laws applied thereby. The parties
hereby agree that any disputes arising hereunder shall be brought before any
court of competent jurisdiction sitting in the city of Los Angeles, State of
California, and hereby consent to jurisdiction and venue in the State of
California.
I. ADVICE, DRAFTING. Each party further agrees and acknowledges that
this Agreement represents the respective understandings of such parties as
negotiated between them, and no
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ambiguity or other aspect of this Agreement shall be construed against any party
solely by virtue of the drafting or presentment of this Agreement. Each party
has been advised to speak with a legal and an accounting professional to
understand the legal and tax implications and impact of the transactions
contemplated hereby, and neither party has relied upon the other, the Company or
their respective counsel in connection therewith.
J. SEVERABILITY. The provisions of this Agreement are severable, and if
any one or more provisions is determined to be illegal, invalid or otherwise
unenforceable, in whole or in part, by any court of competent jurisdiction, then
the remaining provisions of this Agreement and any partially unenforceable
provisions to the extent enforceable in the pertinent jurisdiction, shall
continue in full force and effect and shall be binding and enforceable on the
Parties.
K. SURVIVAL. The representations, warranties, general covenants and
indemnities contained in this Agreement shall survive the termination of this
Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
COMPANY:
ACCUPOLL HOLDING CORP.
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By:
ADVISOR:
SIGNAL CAPITAL PARTNERS
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