Investment Banking Compensation Agreement - Greg Plunkett Inc., Greg Plunkett, Randy Haag and Steve Jasmanian
INVESTMENT BANKING COMPENSATION AGREEMENT
THIS INVESTMENT BANKING COMPENSATION AGREEMENT is entered into by and between
Greg Plunkett, Inc., a California corporation ("Plunkett") and Greg Plunkett
("Greg") on the one hand and Randy Haag ("Haag") and Steve Jasmanian on the
other effective as of March 7, 1995.
RECITALS
A. Haag and Jasmanian have acted as finders of financing for
Plunkett and have been successful in helping to locate significant sums of
monies for Plunkett.
B. Haag and Plunkett entered into a Finders Agreement in December,
1994, which provided for certain compensation payable to Haag for his financing
efforts on behalf of Plunkett.
C. Haag and Plunkett desire to ratify and confirm this compensation
and certain other agreements and rights earned and to be granted to Haag and
Jasmanian by Plunkett.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual agreements, covenants,
representations and warranties contained in this Agreement, the parties hereby
agree as follows:
1. Right of First Refusal. Plunkett hereby grants to Haag and
Jasmanian the right of first refusal to purchase that portion of all new
securities issued by Plunkett (the "New Securities" as defined below) within
three years after the date hereof (the date hereof referred to as the
"Closing") as the number of shares owned and/or purchaseable under options,
warrants or other rights held by Haag and Jasmanian on the date that each
receives the "Offer" (as defined below) bears to the total number of shares of
Plunkett issued and outstanding on the date of the Offer on the following terms
and conditions (the "Preemptive Rights"):
a. Definition. "New Securities" shall mean any capital stock of
Plunkett issued after the Closing, whether now authorized or not, and rights,
options, or warrants to purchase said capital stock, and securities of any type
whatsoever that are, or may become, convertible into said common stock or
preferred stock of Plunkett issued after the Closing; provided, however, that
"New Securities" shall not include (i) up to 2,000,000 new options and the
shares issuable thereunder to employees and consultants of Plunkett (including
investment bankers) under any employee benefit plan at exercise prices no less
that fair market value on date of grant (adjusted appropriately for stock
splits, combinations and the like), or (ii) any shares issued by Plunkett in
connection with a Form S-1 or Form S-3 (or any successor in interest form)
public registration of such shares, whereby in connection with such
registration Plunkett is included on the NASDAQ National Market System or a
national stock exchange and which is declared effective by the Securities and
Exchange Commission.
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b. EXERCISE OF RIGHT. If Plunkett intends to issue New Securities
after the Closing, it shall give Haag and Jasmanian written notice of its
intention, describing the type of New Securities, the price, and the terms upon
which Plunkett proposes to issue the same (the "Offer"). With respect to any
New Securities proposed to be issued for assets or property other than cash,
the price set forth in the notice shall be based upon the fair market value of
such assets or property as determined by the Board of Directors of Plunkett in
its reasonable good faith judgment. Haag and Jasmanian shall have thirty (30)
days from the effective date of such notice to agree to purchase its portion of
the New Securities for the cash equivalent price and upon the other general
terms specified in the Offer by giving written notice to Plunkett and stating
therein the quantity of New Securities to be purchased, accompanied by the cash
equivalent purchase price as set forth in the Offer.
c. FAILURE TO EXERCISE. If Haag or Jasmanian fail to notify
Plunkett during such thirty (30) day notice period of their respective election
to exercise his respective Preemptive Rights, such respective right to
participate in such Offer will terminate. If Plunkett fails to sell the New
Securities on the terms set forth in the Offer within ninety (90) days after
the termination of such thirty (30) day notice period, it must once again
comply with the Preemptive Rights.
2. WARRANT CONSIDERATION. In partial consideration of Haag's and
Jasmanian's financing efforts on behalf of Plunkett in raising $925,000 (the
"Financing"), Plunkett hereby issues an aggregate of 1,300,000 three-year
warrants with an exercise price of $0.10 per share in the respective amounts of
625,000, 625,000 and 50,000 warrants to Randolph Haag, Michael J. Staskus and
Thomas O'Stasic, Sr., respectively, in the form attached hereto as Exhibit A
(the "Warrant Agreement"). Upon such issuance, each of the above individuals
shall acknowledge that no further warrants shall be issued as compensation for
the Financing.
3. GOING PUBLIC.
a. REPORTING ISSUER. Plunkett agrees to use its best efforts to
commence on, or before, August 31, 1995, efforts to become a "reporting issuer"
under the Securities Exchange Act of 1934, and in any event shall file a Form
10 with the Securities and Exchange Commission on, or before, December 31,
1995, if it has not become a "reporting issuer" prior to such date whether by
registration or through a merger with a publicly traded "reporting issuer"
company.
b. DEMAND REGISTRATION RIGHTS. Upon the written request from Haag at
any time after the earlier to occur of (A) six months after Plunkett's first
registered underwritten offering to the general public of its securities for
its own account or (B) March 7, 1996, that Plunkett effect a registration with
respect to (i) all or any portion of the securities issued pursuant to the
Financing, (ii) the shares issuable under any Warrant Agreements and/or (iii)
any securities purchased by Haag or Jasmanian pursuant to the Right of First
Refusal set forth in Section 1 above (collectively, the "Registrable
Securities"), Plunkett will:
i. Promptly give written notice of the proposed registration to
all persons holding Registrable Securities; and
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ii. as soon as practicable, use its diligent best efforts to
effect such registration (including, without limitation, the execution of an
undertaking to file post-effective amendments, appropriate qualifications under
blue sky or other state securities laws and appropriate compliance with
applicable regulations issued under the Securities Act) as may be so requested
and as would permit or facilitate the sale and distribution of all or such
portion or such Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities of any person or
persons joining in such request as is specified in a written request given
within thirty (30) days after receipt of such written notice from Plunkett;
provided that Plunkett shall not be obligated to take any action to effect any
such registration, qualification or compliance pursuant hereto:
x) in any particular jurisdiction in which Plunkett would be
required to execute a general consent to service of process in effecting such
registration, qualification or compliance unless Plunkett is already subject to
service in such jurisdiction and except as may be required by the Securities
Act;
y) if the holders of the Registrable Securities propose to
sell a number of shares of Registrable Securities at an aggregate proposed
offering price to the public of less than $1,000,000;
z) if Plunkett has previously undertaken at least two
registrations pursuant hereto.
Subject to the foregoing clauses, Plunkett shall file a registration
statement covering the Registrable Securities so requested to be registered as
soon as practicable after receipt of the request from Haag.
4. Expense Reimbursement. Upon submission by Haag of reasonable
documentation, Plunkett shall reimburse Haag for up to $5,000 of costs and
expenses incurred by Haag or others in connection with a European financing trip
undertaken by Haag and others on behalf of Plunkett.
5. Board Seat/Consulting Agreement. Plunkett and Greg shall use their
best efforts to cause Jasmanian to be elected to Plunkett's Board of
Directors for a period of three years or until such time that neither Haag or
Jasmanian own either any warrants or equity in Plunkett, whichever occurs
first. Plunkett further agrees to enter into a one year consulting agreement
with Jasmanian to provide up to 20 hours of consulting services per month in
consideration of the issuance of 200,000 three-year warrants exercisable at
$0.10 per share in the form of the Warrant Agreement.
6. Plunkett Indemnification. Plunkett and Greg shall indemnify, defend
and protect Haag and Jasmanian and shall hold Haag and Jasmanian harmless from
and against any and all claims, demands, losses, costs, expenses, obligations,
liabilities, damages, recoveries and deficiencies, including interest, penalties
and reasonable attorneys' fees, that Haag or Jasmanian may incur or suffer,
which arise from or relate to any liability to any person or entity relating to
or resulting from any misrepresentation or omission by Plunkett to Haag or
Jasmanian or any investor related to, in connection with or arising out of
directly or indirectly Plunkett; provided, however, that Plunkett shall not be
obligated to indemnify Haag or Jasmanian to the extent such liability results
from a material misrepresentation made by Haag or Jasmanian, as the case may be,
to an investor concerning Plunkett.
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7. Miscellaneous.
a. Successors and Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto.
b. Entire Agreement. This Agreement constitutes the full and
entire understanding and agreement between and among the parties with regard to
the subjects hereof and thereof.
c. Notices. All notices, requests, demands, instructions or other
communications required or permitted to be given under this Agreement shall be
in writing and (i) shall be deemed to have been duly given upon delivery, if
delivered personally or by one-day courier, or by facsimile transmission where
receipt is acknowledged by the receiving machine or if given by prepaid
telegram, or (ii) if mailed first-class, postage prepaid, registered or
certified mail, return receipt requested, shall be deemed to have been delivered
three (3) business days after deposit in the United States mails, to the
applicable party's address set forth on the signature page. Either party hereto
may change the address to which such communications are to be directed by given
written notice to the other parties hereto of such change in the manner provided
above.
d. Titles and Subtitles. The titles of the paragraphs and
subparagraphs of this Agreement are for the convenience of reference only and
are not to be considered in construing this Agreement.
e. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
f. Attorneys' Fees, Costs. In the event a party breaches this
Agreement, the prevailing party shall pay all costs and attorney's fees
incurred by any other party in connection with such breach, whether or not any
litigation is commenced.
g. Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
RANDY HAAG GREG PLUNKETT, INC.
359 Jacaranda Dr. 600 California, Suite 1300
Danville, CA 94506 San Francisco, CA 94108
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(Address) (Address)
/s/ RANDY HAAG By /s/ GREG PLUNKETT
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(Signature) (Signature)
Greg Plunkett, President
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(Print Name & Title)
GREG PLUNNETT, INC. STEVE JASMANIAN
600 California, Suite 1300 2570 Chestnut St.
San Francisco, CA 94108 San Francisco, CA 94123
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(Address) (Address)
/s/ GREG PLUNKETT /s/ G. STEPHEN JASMANIAN
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(Signature) (Signature)