Consulting Agreement - Benchmark Equity Group Inc. and THINK New Ideas Inc.
CONSULTING AGREEMENT BY AND BETWEEN BENCHMARK EQUITY GROUP, INC. AND THINK NEW IDEAS, INC. THIS AGREEMENT (the "Agreement") is entered into as of this 28th day of March, 1996, by and between Benchmark Equity Group, Inc., a Delaware corporation with principal offices at 16815 Royal Crest Drive, Suite 160, Houston, Texas 77058 (the "Consultant") and Think New Ideas, Inc., a Delaware corporation with principal offices at 8522 National Boulevard, Suite 101, Culver City, California 90232 (the "Corporation"). WHEREAS, the Consultant has developed expertise in providing strategic business advice and consulting services, including finding and assessing acquisition candidates and sources of acquisition financing; and WHEREAS, the Corporation desires to engage the services of the Consultant and the Consultant desires to provide services to the Corporation as set forth below, upon the terms and subject to the conditions set forth herein. NOW, THEREFORE, in consideration of the foregoing and for such other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 1. Engagement. Effective upon execution hereof, the Corporation hereby engages the Consultant to render to it for a period of two (2) years from the date hereof (the "Term") the services described herein. The Term hereof may be extended or renewed upon the written agreement of the Corporation and the Consultant prior to expiration of the Term hereof upon such terms as the parties hereto may negotiate at the time of such extension or renewal. 2. Services. For the Term of this Agreement, the Consultant shall render to the Corporation management consulting advice in the areas of strategic planning, business strategy, acquisition planning, administration and such other related management services as shall reasonably be requested by the board of directors of the Corporation in connection with the operation of the business of the Corporation. Notwithstanding the foregoing, the Consultant shall not be required to devote more than five hours per week to the performance of services hereunder. 3. Compensation. In consideration for the performance of the services described above, upon execution hereof, the Corporation shall pay to the Consultant $35,000 in cash. Thereafter, the Corporation shall pay to the Consultant a monthly fee of $7,000, payable upon the first day of each successive calendar month. In addition, the Corporation shall issue to the Consultant a warrant (the "Warrant") exercisable to purchase an aggregate of up to four hundred thousand (400,000) shares of its common stock, par value $.0001 per share (the "Common Stock") at an exercise price of $2.50 per share. Such warrant shall be exercisable over a period of five years from the date of issuance thereof in increments of 80,000 shares of Common Stock per year; provided however, that: (a) at such time as the price per share (or the closing -------- ------- bid price per share, as applicable) of Common Stock shall equal or exceed $10.49 as quoted on a national or regional exchange or on the Nasdaq National Market/(R)/, the Nasdaq SmallCap Market/(SM)/ or the OTC Electronic Bulletin Board (the "Market Price"), the Warrant <PAGE> shall immediately thereafter become exercisable to purchase up to an aggregate of one hundred thousand (100,000) shares of Common Stock; and (b) at such time as the Market Price shall equal or exceed $15.74 per share, the warrant shall immediately thereafter become exercisable to purchase the remaining one hundred thousand (100,000) shares of Common Stock. 4. Registration Rights. In the event that (but without any obligation to do so) the Corporation proposes to register any of its securities under the Securities Act of 1933 (the "Act") in connection with the public offering of such securities solely for cash (other than a registration on Form S-4, Form S-8 or any form which does not include substantially the same information as would be required to be included in a registration statement covering the sale of the shares of Common Stock issuable upon exercise of the Warrant), the Corporation shall promptly give the Consultant written notice of such registration (the "Piggy-Back Notice"); provided, however, that the Corporation shall have no -------- ------- obligation to so notify the Consultant with respect to any registration subsequent to the first of such registrations to occur after the issuance of the Warrant and shall have no obligation if the managing underwriter of the subject proposed offering expresses its objection thereto to the Corporation. Upon the written request of the Consultant given within twenty (20) days after receipt of such Piggy-Back Notice from the Corporation, the Corporation shall cause to be included in the registration statement filed by the Corporation under the Act all of the shares of Common Stock that the Consultant has requested to be registered; provided, however, that the Corporation shall have no such -------- ------- obligation if the managing underwriter of the subject proposed offering has expressed its objection to the same to the Corporation. To the extent that the Consultant is offered the opportunity hereunder to include all of the shares of Common Stock issuable upon exercise of the Warrant in a registration statement, the Consultant will be deemed to have exercised its sole registration right provided hereby. Whenever required hereunder to file a registration statement to effect the registration of any of the Common Stock, the Corporation shall, as expeditiously as reasonably possible: (a) Prepare and file with the Securities and Exchange Commission (the "SEC") a registration statement with respect to such securities and use its best efforts to cause such registration statement to become effective, and, upon the request of the Consultant, keep such registration statement effective for at least four (4) months. (b) Prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus included therein as may be necessary to comply with the provisions of the Act with respect to the disposition of all securities covered by such registration statement. (c) Furnish to the Consultant such numbers of copies of a prospectus, including a preliminary prospectus, in conformity with the requirements of the Act, and such other documents as it may reasonably request in order to facilitate the disposition of such securities. (d) Use its best efforts to register and qualify the securities covered by such registration statement under the securities laws of such jurisdictions as shall be reasonably requested by the Consultant for the distribution of the securities covered by the registration statement, provided that the Corporation shall not be required in connection therewith or 2 <PAGE> as a condition thereto to qualify to do business or to file a general consent to service of process in any such jurisdiction. (e) In the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement with terms generally satisfactory to the managing underwriter of such offering. (f) Notify the Consultant promptly after the Corporation shall have received notice thereof, of the time when the registration statement becomes effective or any supplement to any prospectus forming a part of the registration statement has been filed. (g) Notify the Consultant of any stop order suspending the effectiveness of the registration statement and use its reasonable best efforts to remove such stop order. It shall be a condition precedent to the obligations of the Corporation to take any action pursuant hereto that the Consultant shall furnish to the Corporation such information regarding itself, the securities held by it, and the intended method of disposition of such securities as shall be required to effect the registration of its securities. In that connection, the Consultant shall be required to represent to the Corporation that all such information which is given is both complete and accurate in all material respects. The Consultant shall deliver to the Corporation a statement in writing from any beneficial owners of such securities that such beneficial owners bona fide intend to sell, transfer or otherwise dispose of such securities. All expenses incurred by the Corporation in complying herewith, including without limitation, all registration and filing fees, printing expenses, fees and disbursements of counsel for the Corporation, blue sky fees and expenses, and the expense of any special audits incident to or required by any such registration (the "Registration Expenses") incurred in connection with any registration, qualification or compliance herewith, shall be borne by the Corporation, and all underwriting discounts, selling commissions and underwriters' expense allowance applicable to the sale and all fees and disbursements of any special counsel for the Consultant ("Selling Expenses") shall be borne by the Consultant; provided, however, that the Corporation shall -------- ------- not be required to pay any Registration Expenses if, as a result of the withdrawal of a request for registration by the Consultant, the registration statement does not become effective. In the case of such withdrawal and the failure of the Consultant to agree to forfeit, the Consultant shall bear such Registration Expenses. The Consultant shall not have any right to obtain or seek an injunction restraining or otherwise delaying any such registration as the result of any controversy that might arise with respect to the interpretation or implementation of this section. The Corporation shall have no obligation pursuant hereto with respect to any request made by the Consultant after the second anniversary of the date of issuance of the Warrant. Notwithstanding any provision hereof to the contrary, the Corporation shall not be required to effect any registration under the Act or under any state securities laws on behalf of the Consultant if, in the opinion of counsel for the Corporation, the offering or transfer by the Consultant in the manner proposed (including, without limitation, the number of shares proposed to be offered or transferred and 3 <PAGE> the method of offering or transfer) is exempt from the registration requirements of the Act and the securities laws of applicable states. The Consultant by acceptance hereof, hereby acknowledges that it is the Corporation's intention to conduct an initial public offering, which offering is contemplated to be underwritten. The Consultant by acceptance hereof hereby agrees: (i) that its right to request registration pursuant to the provisions hereof shall be subject to the approval of the underwriter of such initial public offering (the "Underwriter"); and (ii) the Consultant shall agree to refrain from exercising such right or transferring the Warrant and/or the shares of Common Stock for a period of up to six months should the Underwriter so request in writing. 5. Certain Restrictions. The Consultant understands that: (a) Neither the Warrant nor the shares of Common Stock issuable upon exercise thereof has previously been the subject of registration under the Act or any applicable state securities laws; (b) In the absence of availability of an exemption from the registration requirements of the Act, the Consultant may not sell or otherwise transfer the Warrant or the shares of Common Stock issuable upon exercise thereof unless such securities are subject to an effective registration statement under the Act and any applicable state securities laws; (c) In the event that the Warrant or any shares of Common Stock issuable upon exercise thereof are issued at a time during which a registration statement relating to such issuance is not effective, the offer and sale of such securities are subject to an effective registration statement under the Act, a legend will be placed on any certificate or certificates evidencing the same indicating that such securities have not been registered under the Act and setting forth the restrictions on transferability and sale of such securities; and (d) The Corporation will place stop transfer instructions against the certificate or certificates evidencing the foregoing securities to restrict the transfer thereof. 6. Representations and Warranties. The Consultant hereby represents and warrants to the Corporation that: (a) The Consultant will not sell the securities issued to the Consultant pursuant hereto without compliance with the Act and any applicable state securities laws; (b) The Consultant has received and carefully read certain business information about the Corporation provided to it by the Corporation and written or verbal responses to all questions the Consultant has submitted to the Corporation regarding its acquisition of the securities described herein, all of which the Consultant acknowledges have been provided to the Consultant. Such information may be referred to hereinafter as the "Corporate Materials." Other than the Corporate Materials, the Consultant has not been furnished with any other materials or literature relating to the acquisition of the securities described 4 <PAGE> herein. The Consultant has been given the opportunity to ask questions of and to receive answers from the Corporation concerning the terms and conditions of the acquisition of the securities described herein and the Corporate Materials, and to obtain such additional written information necessary to verify the accuracy of same as the Consultant desires in order to evaluate the acquisition of and investment in the securities described herein. The Consultant acknowledges and confirms that the written and/or verbal responses provided to the Consultant by the Corporation in response to the Consultant's questions are not contrary to or inconsistent with, nor do they conflict with the information set forth in the Corporate Materials. The Consultant further acknowledges that it understands the information contained in the Corporate Materials and the Consultant has had the opportunity to discuss any questions regarding the Corporate Materials with its counsel or other advisor. The only information upon which the Consultant has relied is that which is set forth in the Corporate Materials; (c) The Consultant understands that no federal or state agency or other authority: (i) has made any finding or determination regarding the fairness of the transactions described herein, (ii) has made any recommendation or endorsement of the transactions described herein, or (iii) has passed in any way upon this agreement or the Corporate Materials; (d) The Consultant: (i) is acquiring the securities described herein solely for its own account for investment purposes only and not with a view toward resale or distribution thereof, either in whole or in part; and (ii) has no contract, undertaking, agreement or other arrangement, in existence or contemplated, to sell, pledge, assign or otherwise transfer the securities to any other person; (e) The Consultant has adequate means of providing for its current needs and contingencies and has no need for liquidity in the investment in the securities described herein. The Consultant has read, is familiar with and understands Rule 501 of Regulation D and represents that he is an "accredited investor" as defined in Rule 501(a) of Regulation D under the Act. The Consultant has no reason to anticipate any material change in its financial condition for the foreseeable future; (f) The Consultant is aware that the acquisition of the securities described herein is a speculative investment involving a high degree of risk and that there is no guarantee that the Consultant will realize any gain from its acquisition of or investment in such securities; (g) The Consultant is financially able to bear the economic risk of an investment in the securities described herein, including the ability to hold such securities indefinitely and to afford a complete loss of an investment in such securities; (h) The Consultant's overall commitment to investments which are not readily marketable is not disproportionate to the Consultant's net worth, and the Consultant's investment in the securities described herein will not cause such overall commitment to become excessive; and 5 <PAGE> (i) The Consultant has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of the acquisition of and an investment in the securities described herein. The Corporation hereby represents and warrants to the Consultant that: (a) The execution, delivery and performance of this Agreement and consummation of the transactions contemplated hereby have been duly authorized, adopted and approved by the board of directors of the Corporation. The Corporation has taken all necessary corporate action and has all the necessary corporate power and authority to enter into this Agreement and to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by an authorized officer of the Corporation on its behalf and is the valid and binding obligation of the Corporation, enforceable against the Corporation in accordance with its terms, except as such enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect, or by legal or equitable principles, relating to or limiting creditors' rights generally and except that the remedy of specific performance and injunctive and other forms of equitable relief are subject to certain equitable defenses and to the discretion of the court before which any proceeding therefor may be brought; (b) The Corporation is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. The Corporation has the corporate power and authority to own and lease its properties and assets and to carry on its business as it is now being conducted and is duly qualified to do business as a foreign corporation in each jurisdiction where it owns or leases real property or conducts business, except where the failure to be so qualified would not have a material adverse effect on the business, operations or condition (financial or otherwise) of the Corporation; (c) The Corporation is authorized to issue an aggregate of 15,000,000 shares of Common Stock and 1,000,000 shares of preferred stock. All outstanding shares of the Corporation's capital stock have been duly authorized, validly issued and are fully paid and non-assessable. The shares of Common Stock to be issued upon exercise of the Warrant, assuming payment therefor in accordance with the provisions thereof and will be upon issuance, free of preemptive rights and free and clear of all adverse claims, liens, mortgages, charges, security interests, encumbrances and other restrictions or limitations of any kind whatsoever. The Corporation has not issued any shares of capital stock which could give rise to claims for violation of any federal or state securities laws (including any rules or regulations promulgated thereunder) or the securities laws of any other jurisdiction (including any rules or regulations promulgated thereunder). (d) There is no contract or agreement to which the Corporation is a party or by which it or its assets are bound which prohibits the Corporation from executing and delivering this Agreement or performing its obligations as set forth hereunder; 6 <PAGE> (e) Neither the execution and delivery of this Agreement by the Corporation, nor consummation of the transactions contemplated hereby, does or will: (i) violate or conflict with any provision of the certificate of incorporation or bylaws of the Corporation; (ii) violate or, with the passage of time, result in the violation of any provision of, or result in the acceleration of or entitle any party to accelerate any obligation under, or result in the creation or imposition of any lien, charge, pledge, security interest or other encumbrance upon any of the property or assets of the Corporation, pursuant to any provision of any mortgage, lien, lease, agreement, permit, indenture, license, instrument, law, order, arbitration award, judgment or decree to which the Corporation is a party or by which it or any of such property or assets are bound; (iii) violate or conflict with any other restriction of any kind whatsoever to which the Corporation is subject, or by which its properties or assets may be bound; or (iv) violate or constitute a breach under any provision of any agreement to which the Corporation is a party or is subject. No consent, authorization, order or approval of, or filing or registration with, any governmental commission, board or other regulatory body is required in connection with the execution, delivery and performance of the terms of this Agreement and consummation of the transactions contemplated hereby by the Corporation; and (f) There is no action, suit, proceeding or investigation pending or threatened which could restrict the Corporation's ability to perform its obligations hereunder. There are no grounds for or facts, events or circumstances which could form the basis of any such action that could cause or result in any such action, suit, proceeding or investigation or which is probable of assertion. The Corporation is not in default in respect of any judgment, order, writ, injunction or decree of any court or any federal, state, local or other governmental agency, authority, body, board, bureau, commission, department or instrumentality, which default would in any way affect, impair or compromise the Corporation's ability to consummate the transactions contemplated hereby or would otherwise compromise in any way the validity or legality of this Agreement or the transactions contemplated hereby. 7. Confidential Information. By reason of performance under this Agreement, the Consultant may have access to and may obtain specialized knowledge, trade secrets and confidential information about the business and operation of the Corporation, its subsidiaries and divisions thereof. Therefore, the Consultant hereby agrees that he shall keep secret and retain in confidence and shall not use, disclose to others, or publish, other than in connection with the performance of services hereunder and in accordance herewith, any information relating to the business, operation or other affairs of the Corporation, its subsidiaries and divisions thereof, which information is acquired in the course of providing services for the Corporation. To the extent that any of such information may be deemed from time to time to be "material non-public information" as construed under the Exchange Act of 1934, the Consultant hereby agrees not to purchase or sell (or offer to purchase or sell) any of the Corporation's securities while in possession of information which may be so deemed to be "material non-public information." 7 <PAGE> 8. Indemnification. The Consultant and the Corporation hereby agree as follows: (a) The Corporation hereby agrees to indemnify and hold harmless the Consultant against and in respect of all damages, claims, losses and expenses (including, without limitation, attorneys' fees and disbursements) reasonably incurred (all such amounts may hereinafter be referred to as the "Damages") by the Consultant arising out of: (i) any misrepresentation or breach of any warranty made by the Corporation pursuant to the provisions of this Agreement or in any statement, certificate or other document furnished by the Corporation pursuant to this Agreement, and (ii) the nonperformance or breach of any covenant, agreement or obligation of the Corporation contained in this Agreement which has not been waived by the Consultant; (b) The Corporation shall be obligated to indemnify the Consultant with respect to claims for Damages as to which the Consultant shall have given written notice to the Corporation on or before the close of business on the sixtieth day following the second anniversary hereof; (c) In any case where the Corporation has indemnified the Consultant for any Damages and the Consultant recovers from third parties all or any part of the amount so indemnified by the Corporation, the Consultant shall promptly pay over to the Corporation the amount so recovered; (d) With respect to claims or demands by third parties, whenever the Consultant shall have received notice that such a claim or demand has been asserted or threatened which, if valid, would be subject to indemnification hereunder, the Consultant shall as soon as reasonably possible and in any event within thirty (30) days of receipt of such notice, notify the Corporation of such claim or demand and of all relevant facts within its knowledge which relate thereto. The Corporation shall then have the right at its own expense to undertake the defense of any such claims or demands utilizing counsel selected by the Corporation and approved by the Consultant, which approval shall not be unreasonably withheld. In the event that the Corporation should fail to give notice of the intention to undertake the defense of any such claim or demand within thirty (30) days after receiving notice that it has been asserted or threatened, the Consultant shall have the right to satisfy and discharge the same by payment, compromise or otherwise and shall give written notice of any such payment, compromise or settlement to the Corporation; (e) The Consultant hereby agrees to indemnify and hold harmless the Corporation against and in respect of all Damages reasonably incurred by the Corporation arising out of: (i) any misrepresentation or breach of any warranty made by the Consultant pursuant to the provisions of this Agreement, and (ii) the nonperformance or breach of any covenant, agreement or obligation of the Consultant which has not been waived by the Corporation; (f) The Consultant shall be obligated to indemnify the Corporation for Damages as to which the Corporation shall have given written notice to the Consultant on or before the close of business on the sixtieth day following the second anniversary hereof; 8 <PAGE> (g) In any case where the Consultant has indemnified the Corporation for any Damages and the Corporation recovers from third parties all or any part of the amount so indemnified by the Consultant, the Corporation shall promptly pay over to the Consultant the amount so recovered; (h) With respect to claims or demands by third parties, whenever the Corporation shall have received notice that such a claim or demand has been asserted or threatened, which, if valid, would be subject to indemnification hereunder, the Corporation shall as soon as reasonably possible and in any event within thirty (30) days of receipt of such notice, notify the Consultant of such claim or demand and of all relevant facts within its knowledge which relate thereto. The Consultant shall have the right at its expense to undertake the defense of any such claim or demand utilizing counsel selected by the Consultant and approved by the Corporation, which approval shall not be unreasonably withheld. In the event that the Consultant should fail to give notice of its intention to undertake the defense of any such claim or demand within thirty (30) days after receiving notice that it has been asserted or threatened, the Corporation shall have the right to satisfy and discharge the same by payment, compromise or otherwise and shall give written notice of any such payment, compromise or settlement to the Consultant; and (i) Without limiting any of the foregoing, the Corporation shall indemnify and hold harmless the Consultant against any losses, claims, damages or liabilities to which such Consultant becomes subject under federal or state securities or blue sky laws, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) are based upon any untrue statement of a material fact contained in a registration statement filed pursuant hereto, a final prospectus contained in such registration statement, or an amendment or supplement thereto, or are based upon the omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The Corporation shall reimburse the Consultant for any legal or any other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that the Corporation shall not be liable -------- ------- in any case to the extent that any loss, claim, damage or liability arises out of, is based upon or is derived from any untrue statement or omission made in such registration statement, final prospectus or any amendment or supplement thereto, in reliance upon and in conformity with information furnished in writing to the Corporation by or on behalf of the Consultant for use in preparation thereof. 9. Applicable Law. This Agreement shall be construed and enforced in accordance with the laws of the State of Delaware without regard to the principles of conflicts of laws thereof and shall inure to the benefit of and be binding upon the Consultant and the Corporation and their respective legal successors and assigns. 10. Arbitration. The Corporation represents, warrants, covenants and agrees that any controversy or claim brought in any capacity by the Corporation against the Consultant or any members, officers, directors, agents, affiliates, associates, employees or controlling persons of the Consultant shall be settled by expedited arbitration under the Federal Arbitration Act in accordance with the commercial arbitration rules of the American Arbitration Association ("AAA") and judgment upon the award 9 <PAGE> rendered by the arbitrators may be entered in any court having jurisdiction thereof. Any controversy or claim brought by the Consultant against the Corporation or its securityholders, officers, directors, agents, affiliates, associates, employees or controlling persons shall be settled by arbitration under the Federal Arbitration Act in accordance with the commercial arbitration rules of the AAA and judgment rendered by the arbitrators may be entered in any court having jurisdiction thereof. In arbitration proceedings under this section, the parties shall be entitled to any and all remedies that would be available in the absence of this section and the arbitrators, in rendering their decision, shall follow the substantive laws of the State of Delaware. The arbitration of any dispute pursuant to this paragraph shall be held in the State of Delaware. Notwithstanding the foregoing, in order to preserve the status quo pending the resolution by arbitration of a claim seeking relief of an injunctive or equitable nature, any party, upon submitting a matter to arbitration as required by this section, may simultaneously or thereafter seek a temporary restraining order or preliminary injunction from a court of competent jurisdiction pending the outcome of the arbitration. This section is intended to benefit the members, managers, agents, affiliates, associates and employees of the Consultant, each of whom shall be deemed to be a third party beneficiary of this section, and each of whom may enforce this section to the full extent that the Consultant could do so if a controversy or claim were brought against it. 11. No Continuing Waiver. The waiver by any party of any provision or breach of this Agreement shall not operate as or be construed to be a waiver of any other provision hereof or of any other breach of any provision hereof. 12. Notice. Any and all notices from either party to the other which may be specified by, or otherwise deemed necessary or incident to this Agreement shall, in the absence of hand delivery with return receipt requested, be deemed duly given when mailed if the same shall be sent to the address of the party set out on the first page of this Agreement by registered or certified mail, return receipt requested, or express delivery (e.g., Federal Express). 13. Severability of Provisions. The provisions of this Agreement shall be considered severable in the event that any of such provisions are held by a court of competent jurisdiction to be invalid, void or otherwise unenforceable. Such invalid, void or otherwise unenforceable provisions shall be automatically replaced by other provisions which are valid and enforceable and which are as similar as possible in term and intent to those provisions deemed to be invalid, void or otherwise unenforceable. Notwithstanding the foregoing, the remaining provisions hereof shall remain enforceable to the fullest extent permitted by law. 14. Assignability. This Agreement shall not be assignable without the prior written consent of the non-assigning party or parties hereto and shall be binding upon and inure to the benefit of any heirs, executors, legal representatives or successors or permitted assigns of the parties hereto. 15. Entire Agreement; Amendment. This Agreement contains the entire agreement among the Corporation and the Consultant with respect to the subject matter hereof. This Agreement may not be amended, changed, modified or discharged, nor may any provision hereof be waived, except by an instrument in writing executed by or on behalf of the party against whom enforcement of any 10 <PAGE> amendment, waiver, change, modification or discharge is sought. No course of conduct or dealing shall be construed to modify, amend or otherwise affect any of the provisions hereof. 16. Headings. The paragraph headings contained in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of the provisions of this Agreement. 17. Survival. Sections 6, 7, 8, 9, 11, 12 and 13 shall survive the termination for any reason of this Agreement (whether such termination is by the Corporation, upon the expiration of this Agreement by its terms or otherwise). IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and delivered by their duly authorized officers as set forth below and have caused their respective corporate seals to be hereunder affixed as of the date first above written. THINK NEW IDEAS, INC. By: /s/ Scott A. Mednick -------------------------------------------- Scott A. Mednick, Chief Executive Officer BENCHMARK EQUITY GROUP, INC. By: /s/ Frank M. DeLape -------------------------------------------- Frank M. DeLape, President 11
BENCHMARK EQUITY GROUP, INC. 16815 ROYAL CREST DRIVE SUITE 160 HOUSTON, TEXAS 77508 August 9, 1996 Scott A. Mednick, Chairman and Chief Executive Officer THINK New Ideas, Inc. 8522 National Boulevard, Suite 101 Culver City, California 90232-2481 Re: Amendment to Consulting Agreement (3/28/96) ------------------------------------------- Dear Scott: Reference is hereby made to that certain consulting agreement dated as of March 28, 1996 (the "Consulting Agreement") between Benchmark Equity Group, Inc. ("Benchmark") and THINK New Ideas, Inc. (the "Corporation"). This letter is intended to confirm that, notwithstanding anything else to the contrary set forth in the Consulting Agreement, Benchmark and the Corporation hereby agree that the reference in Section 3 of the Consulting Agreement to the Warrants (as defined therein) shall be deleted therefrom and no Warrants shall be deliverable thereunder. Except as otherwise expressly modified hereby or required to effectuate the modification set forth herein, the Consulting Agreement shall remain unchanged and shall continue in full force an effect pursuant to the terms thereof. This letter agreement contains the entire agreement between Benchmark and the Corporation with respect to the modification which is the subject hereof. This letter agreement may not be amended, changed, modified or discharged, nor may any provision hereof be waived, except by an instrument in writing executed by or on behalf of the party against whom enforcement of any amendment, waiver, change, modification or discharge is sought. No course of conduct or dealing shall be construed to modify, amend or otherwise affect any of the provisions hereof. Please confirm that the Corporation is in agreement with the foregoing, and that the foregoing is in accordance with your understanding by signing and returning this letter, which shall thereupon constitute a binding agreement. Agreed to and accepted as of this 9th day of August, 1996: Very truly yours, THINK NEW IDEAS, INC. BENCHMARK EQUITY GROUP, INC. By: /s/ Scott A. Mednick By: /s/ Frank M. DeLape ------------------------------- -------------------------------- Scott A. Mednick Frank M. DeLape, President Chief Executive Officer