June 23, 2004
PERSONAL AND CONFIDENTIAL
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Capital Resource Funding, Inc.
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Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇
President
Dear ▇▇▇▇▇:
This letter agreement ("Agreement") confirms the terms and conditions of the
exclusive engagement of Greentree Financial Group, Inc. ("Greentree") by Capital
Resource Funding, Inc. (the "Company") to render certain financial advisory
services to the Company in connection with the Company's strategic and financial
alternatives in the United States capital markets.
1. Services. Greentree agrees to perform the following services:
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(a) Assist with the preparation of SEC Registration Statement Form SB-2;
(b) Assist with the preparation of Board Resolution authorizing the
transactions;
(c) Assist with preparing the company in corporate housekeeping;
(d) Assist with the preparation of share exchange agreement with a publicly
traded company;
(e) Edgarization of the SB-2 with the Securities and Exchange Commission;
(f) Assist with the preparation of a newly created class of preferred stock.
2. Fees. The Company agrees to pay Greentree for its services with a
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financial advisory fee ("Advisory Fee") of $48,835 cash, in addition to
interest, and 490,000 shares of free-trading common stock during the Term based
on the Company's proposed issued and outstanding common shares of 10,000,000
payable as follows: A payment of $10,000 cash shall be made upon signing this
agreement. The final payment of $40,000 cash (which includes $38,835 principal
and $1,165 in interest at 6% per annum) and 490,000 common shares shall be made
within 6 months. All of the above common shares will be registered in the Form
SB-2 above.
3. Term. The term of this Agreement shall commence on June 23, 2004 and end
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on the date of SB-2 submission to the SEC (the "Term"). This Agreement may be
renewed upon mutual written agreement of the parties hereto with the additional
services and fees to be mutually agreed upon. This agreement may be terminated
by the Company with 45 days prior written notice to Greentree. If the Company
terminates this Agreement prior to the expiration of the Term, the Company shall
pay to Greentree all reasonable expenses incurred, in accordance with Paragraph
5 hereof. Any obligation pursuant to this Paragraph 3, and pursuant to
Paragraphs 2, 4, 5, 6 and 8 hereof, shall survive the termination or expiration
of this Agreement.
4. Expenses. The Company agrees to reimburse Greentree for all of its
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reasonable out-of-pocket fees, expenses and costs (including, but not limited
to, legal, accounting, travel, accommodations, telephone, computer, courier and
supplies) in connection with the performance of its services under this
Agreement, upon prior written approval. All such fees, expenses and costs will
be billed at any time by Greentree and are payable by the Company when invoiced.
Upon expiration of the Agreement any unreimbursed fees and expenses will be
immediately due and payable.
5. Indemnification. In addition to the payment of fees and reimbursement of
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fees and expenses provided for above, the Company agrees to indemnify Greentree
and its affiliates with regard to the matters contemplated herein, as set forth
in Exhibit A, attached hereto, which is incorporated by reference as if fully
set forth herein.
6. Matters Relating to Engagement. The Company acknowledges that Greentree
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has been retained solely to provide the services set forth in this Agreement.
In rendering such services, Greentree shall act as an independent contractor,
and any duties of Greentree arising out of its engagement hereunder shall be
owed solely to the Company. The Company further acknowledges that Greentree may
perform certain of the services described herein through one or more of its
affiliates.
The Company acknowledges that Greentree is a consulting firm that is
engaged in providing financial advisory services. The Company acknowledges and
agrees that in connection with the performance of Greentree's services hereunder
(or any other services) that neither Greentree nor any of its employees will be
providing the Company with legal, tax or accounting advice or guidance (and no
advice or guidance provided by Greentree or its employees to the Company should
be construed as such) and that neither Greentree nor its employees hold itself
or themselves out to be advisors as to legal, tax, accounting or regulatory
matters in any jurisdiction. The Company shall consult with its own legal, tax,
accounting and other advisors concerning all matters and advice rendered by
Greentree to the Company and the Company shall be responsible for making its own
independent investigation and appraisal of the risks, benefits and suitability
of the advice and guidance given by Greentree to the Company and the
transactions contemplated by this Agreement. Neither Greentree nor its employees
shall have any responsibility or liability whatsoever to the Company or its
affiliates with respect thereto.
The Company recognizes and confirms that in performing its duties pursuant
to this Agreement, Greentree will be using and relying on data, material, and
other information (the "Information") furnished by the Company, a Strategic
Partner or their respective employees and representatives. The Company will
cooperate with Greentree and will furnish Greentree with all Information
concerning the Company and any Transaction, Alternate Transaction or Financing
which Greentree deems appropriate and will provide Greentree with access to the
Company's officers, directors, employees, independent accountants and legal
counsel for the purpose of performing Greentree's obligations pursuant to this
Agreement. The Company hereby agrees and represents that all Information
furnished to Greentree pursuant to this Agreement shall be accurate and complete
in all material respects at the time provided, and that, if the Information
becomes materially inaccurate, incomplete or misleading during the term of
Greentree's engagement hereunder, the Company shall promptly advise Greentree in
writing. Accordingly, Greentree assumes no responsibility for the accuracy and
completeness of the Information. In rendering its services, Greentree will be
using and relying upon the Information without independent verification
evaluation thereof.
7. Governing Law. This Agreement shall be governed by and construed in
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accordance with the laws of the State of Florida without regard to the conflict
of laws provisions thereof.
8. No Brokers. The Company represents and warrants to Greentree that there
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are no brokers, representatives or other persons which have an interest in
compensation due to Greentree from any services contemplated herein.
9. Authorization. The Company and Greentree represent and warrant that each
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has all requisite power and authority, and all necessary authorizations, to
enter into and carry out the terms and provisions of this Agreement and the
execution, delivery and performance of this Agreement does not breach or
conflict with any agreement, document or instrument to which it is a party or
bound.
10. Miscellaneous. This Agreement constitutes the entire understanding and
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agreement between the Company and Greentree with respect to the subject matter
hereof and supersedes all prior understanding or agreements between the parties
with respect thereto, whether oral or written, express or implied. Any
amendments or modifications must be executed in writing by both parties. This
Agreement and all rights, liabilities and obligations hereunder shall be binding
upon and insure to the benefit of each party's successors but may not be
assigned without the prior written approval of the other party. If any
provision of this Agreement shall be held or made invalid by a statute, rule,
regulation, decision of a tribunal or otherwise, the remainder of this Agreement
shall not be affected thereby and, to this extent, the provisions of this
Agreement shall be deemed to be severable. This Agreement may be executed in
any number of counterparts, each of which, shall be deemed to be an original,
but such counterparts shall, together, constitute only one instrument. The
descriptive headings of the Paragraphs of this Agreement are inserted for
convenience only, do not constitute a part of this Agreement and shall not
affect in anyway the meaning or interpretation of this Agreement.
Please confirm that the foregoing correctly sets forth our agreement by
signing below in the space provided and returning this Agreement to Greentree
for execution, which shall constitute a binding agreement as of the date first
above written.
Thank you. We look forward to a mutually rewarding relationship.
GREENTREE FINANCIAL GROUP, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, CPA
Title: President and Chief Executive Officer
AGREED TO AND ACCEPTED
AS OF JUNE 23, 2004:
CAPITAL RESOURCE FUNDING, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
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EXHIBIT A: INDEMNIFICATION
The Company agrees to indemnify Greentree, its employees, directors,
officers, agents, affiliates, and each person, if any, who controls it within
the meaning of either Section 20 of the Securities Exchange Act of 1934 or
Section 15 of the Securities Act of 1933 (each such person, including Greentree
is referred to as "Indemnified Party") from and against any losses, claims,
damages and liabilities, joint or several (including all legal or other expenses
reasonably incurred by an Indemnified Party in connection with the preparation
for or defense of any threatened or pending claim, action or proceeding, whether
or not resulting in any liability) ("Damages"), to which such Indemnified Party,
in connection with providing its services or arising out of its engagement
hereunder, may become subject under any applicable Federal or state law or
otherwise, including but not limited to liability or loss (i) caused by or
arising out of an untrue statement or an alleged untrue statement of a material
fact or omission or alleged omission to state a material fact necessary in order
to make a statement not misleading in light of the circumstances under which it
was made, (ii) caused by or arising out of any act or failure to act, or (iii)
arising out of Greentree's engagement or the rendering by any Indemnified Party
of its services under this Agreement; provided, however, that the Company will
not be liable to the Indemnified Party hereunder to the extent that any Damages
are found in a final non-appealable judgment by a court of competent
jurisdiction to have resulted from the gross negligence or willful misconduct of
the Indemnified Party seeking indemnification hereunder.
These indemnification provisions shall be in addition to any liability
which the Company may otherwise have to any Indemnified Party.
If for any reason, other than a final non-appealable judgment finding an
Indemnified Party liable for Damages for its gross negligence or willful
misconduct the foregoing indemnity is unavailable to an Indemnified Party or
insufficient to hold an Indemnified Party harmless, then the Company shall
contribute to the amount paid or payable by an Indemnified Party as a result of
such Damages in such proportion as is appropriate to reflect not only the
relative benefits received by the Company and its shareholders on the one hand
and the Indemnified Party on the other, but also the relative fault of the
Company and the Indemnified Party as well as any relevant equitable
considerations.
Promptly after receipt by the Indemnified Party of notice of any claim or
of the commencement of any action in respect of which indemnity may be sought,
the Indemnified Party will notify the Company in writing of the receipt or
commencement thereof and the Company shall have the right to assume the defense
of such claim or action (including the employment of counsel reasonably
satisfactory to the Indemnified Party and the payment of fees and expenses of
such counsel), provided that the Indemnified Party shall have the right to
control its defense if, in the opinion of its counsel, the Indemnified Party's
defense is unique or separate to it as the case may be, as opposed to a defense
pertaining to the Company. In any event, the Indemnified Party shall have the
right to retain counsel reasonably satisfactory to the Company, at the Company's
sole expense, to represent it in any claim or action in respect of which
indemnity may be sought and agrees to cooperate with the Company and the
Company's counsel in the defense of such claim or action. In the event that the
Company does not promptly assume the defense of a claim or action, the
Indemnified Party shall have the right to employ counsel to defend such claim or
action. Any obligation pursuant to this Annex shall survive the termination or
expiration of the Agreement.
