EXHIBIT 10.16
[LETTERHEAD OF SITRICK AND COMPANY INC.]
September 26, 1996
Xx. Xxxxxx Xxxxxxxxx
President
Digital Video Systems
0000 Xxxxx Xxxxxx
Xxxxx Xxxxx, Xxxxxxxxxx 00000
Dear Xxx:
This will confirm our agreement (the "Agreement") as follows:
1. Digital Video Systems (the "Company") has retained Sitrick And Company
("Sitrick") as investor relations and public relations counsel for an
initial six-month period commencing September 26, 1996, plus an additional
six-month extension period if such an extension is mutually agreed upon.
Services to be provided by Sitrick shall include without limitation the
following:
(a) Preparation of Company press releases
(b) Preparation of Company reports to shareholders, including annual
and quarterly reports
(c) Arranging for Company road shows
(d) Assisting the Company to obtain analyst coverage for the Company
(e) Assisting the Company to obtain additional market makers for the
Company's securities
(f) Assisting the Company to obtain financial and other news media
coverage of its activities
(g) Responding to broker and shareholder inquiries concerning the
status of the Company's activities
2. The Company will pay Sitrick a monthly retainer (the "Monthly Retainer")
consisting of $10,000 in cash and 599 shares of the Company's common stock
to be issued by the Company. Time charges will be billed for professional
fees against the Monthly Retainer at the hourly rate range of $150 to
$375; Sitrick will advise the Company in advance should its anticipated
fees for any month exceed $15,016 on a cumulative basis (the "Excess
Fees") calculated on a semi-annual basis. The excess fees will be paid by
the Company 65% in cash and 35% in the Company's Common Stock (valued at
$8.375 per share, the closing price on September 24, 1996. Sitrick will
have customary "piggyback" registration rights (at no cost to Sitrick)
with respect to all shares of common stock issued under this agreement.
Xx. Xxxxxx Xxxxxxxxx
September 25, 1996
Page 2
3. In addition to the compensation described in paragraph 2 above, Sitrick will
be issued each month during the term of this Agreement a five-year warrant
to purchase 2995 shares of common stock at $8.375 per share as part of its
monthly retainer and five warrants for each share of stock issued as payment
of excess fees. Stock and warrants issued under this Agreement will be
issued quarterly.
4. Sitrick further agrees to advance funds on behalf of the Company for
out-of-pocket expenses incurred. The Company will place $2,500 in cash on
deposit with Sitrick against out-of-pocket expenses, which will include
travel, production and related costs, and which will be rebilled directly
for cash reimbursement in a separate detailed monthly statement. Any
expenses in excess of $2,500 shall be billed and paid by the Company as
incurred.
5. The Company will indemnify and hold harmless Sitrick, its controlling
persons, officers, directors, employees and agents from and against any and
all losses, claims, damages, liabilities, costs and expenses (including, but
not limited to reasonable attorney's fees) which Sitrick or any of the
foregoing persons may be subject to or incur in connection with the services
to be rendered by Sitrick to the Company (including, but not limited to, its
or their reliance upon or use of any information, documents,
representations, reports or data furnished by or prepared by the Company.).
This paragraph shall not apply to any action or inaction which has been
judicially determined to be willful misconduct or gross negligence on the
part of Sitrick; and Sitrick will indemnify and hold the Company harmless
for any loss, costs or expenses (including but not limited to reasonable
attorneys' fees) resulting from any such misconduct or gross negligence.
6. Xxxxxxx'x engagement hereunder may be terminated by either party on 30-days
written notification, it being understood that the provision hereof relating
to the payment of unpaid fees and accrued expenses and indemnification will
survive any such termination.
If this conforms to your understanding of our agreement, please sign the
attached copy and return it to me for our files.
Sincerely,
Agreed: Sitrick And Company Agreed: Digital Video Systems
By: /s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxxx Xxxxxxxxx
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Xxxxxxx X. Xxxxx Xxxxxx Xxxxxxxxx
Date: 9/26/96 Date: 9/27/96
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