Exhibit 99.2
September 15, 2004
Xxxx Xxxxxxx, President
GK Intelligent Systems
0000 Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Dear Xx. Xxxxxxx:
This letter agreement (the "Agreement") will confirm our understanding whereby
GK Intelligent Systems (the "Company") retains Xxxxxxxxxx Investor Relations,
Inc. ("RIR") as its investor relations consultant with respect to matters
concerning the financial and investment communities.
1. Term.
A. The Company retains RIR as its investor relations consultant for a
four-month period commencing on September 9, 2004.
B. The term of this Agreement, following the initial four-month
period and without any further action by either party shall be renewed
automatically on a month-to-month basis, unless either the Company or RIR
terminates this Agreement in writing upon 30 days notice to the other party.
2. Services. As part of the investor relations services that RIR will
provide to the Company, RIR will:
(a) provide COMPANY with investor relations counsel and guidance to
enhance the Company's visibility in the financial markets;
(b) arrange appointments for COMPANY with asset managers, broker
dealers, analysts and institutions; and
(c) advise COMPANY on communications strategies as it relates to
communications to its board of directors and stockholders.
3. Fees and Expenses.
A. The Company will pay RIR a fee of $6,000 for RIR's investor
relations services. Following the initial four-month period and without any
further action by either party, this Agreement shall be renewed automatically
on a month-to-month basis at the same $6,000 per month fee. Going forward, XXX
will bill the Company for all fees and expenses on the 15th of every month.
The Company will pay each invoice within 15 days after receiving it. In
addition to the monthly fee, the Company will deliver a compensation package
in the form of a warrant evidencing the right to purchase during a three-year
period 100,000 shares of its common stock at an exercise price equivalent to
the closing price of the common stock at the date of the execution of this
agreement (the "Warrant").
The Warrant will be exercised at no expense to RIR and the standard
piggyback registration rights. The warrant will be subject to adjustment in
the event of stock splits, corporate transactions or other events affecting
the number of shares of common stock outstanding. The company further agrees
to register the securities underlying these warrants within a 6-month period
from the date of this agreement. The warrant will vest in its entirety upon
the commencement of the engagement of Xxxxxxxxxx Investor Relations, Inc.
B. The Company will pay all of RIR's out-of-pocket expenses. These
out-of-pocket expenses may include postage, copier charges, telephone,
messengers, photography, printing, and other similar expenses. RIR will not
charge a markup, surcharge, handling or administrative fee on such expenses.
X. XXX will obtain prior approval from the Company for any individual
out-of-pocket expense that is greater than $150.00. If RIR's total
out-of-pocket expenses are greater than $100.00 per month, then RIR will
provide the Company with copies of invoices and other receipts to support the
amount of out-of-pocket expenses, if the Company requests RIR to do so.
D. The Company understands that, depending on the nature of the
expenses that RIR incurs on the Company's behalf, RIR may not receive the
bills from vendors who provide certain services and/or products until after
this Agreement has terminated. In such case, the Company will reimburse RIR
for such expenses promptly after RIR notifies the Company of the amount due.
E. All invoices for out of pocket expenses and services rendered
shall be binding upon the Company and shall not be subject to objection for
any reason unless such objection is made in writing, states the basis for such
objection in detail and is delivered to RIR in connection with fees within
30 days of the completion of the relevant billing cycle or in connection with
expenses within 30 days of the related invoice for such expenses.
F. Upon termination of this Agreement, RIR shall deliver an invoice
for any outstanding amounts due, including fees and expenses. The amount of
such invoice shall be due and payable within thirty (30) days of such invoice.
The Company will be charged a late fee of 1.5% per month of the unpaid balance
due on such invoice until paid.
G. In addition to the fees and expenses payable by the Company to RIR
pursuant to the terms of this Agreement, the Company hereby agrees to pay to
RIR all costs and expenses, including all reasonable attorneys' fees and
disbursements, incurred by RIR in collection of its fees and expenses payable
pursuant to the terms of this Agreement.
4. Indemnification.
A. The Company understands that RIR cannot undertake to verify the
accuracy of information that the Company (or someone on behalf of the Company)
provides to RIR, or information included in material that has been prepared by
RIR and approved by the Company.
B. The Company agrees to indemnify and hold harmless RIR, and its
officers, directors, employees, shareholders, representatives and agents from
and against any and all losses, liabilities, claims, damages, deficiencies,
costs and expenses (including reasonable attorney's fees, disbursements and
other charges) based upon or arising out of the performance of any services
provided under this Agreement, or any materials, releases, reports or
information that the Company (or someone on the Company's behalf) supplies to
RIR or prepared by RIR, except to the extent that such losses are due to the
gross negligence or willful misconduct of RIR. The Company's agreement to
indemnify will survive the expiration or termination of this Agreement.
C. The Company agrees that all information that it or its employees, officers,
directors or affiliates (or any person on the Company's behalf) provides to
RIR for dissemination will comply with any and all federal and state
securities laws and the rules and regulations of any applicable self
regulating securities association and securities exchange. All such
information will be accurate and will fairly represent the Company's
situation. All such information will not omit any information which would
make the information that was provided materially misleading.
5. Non-Solicitation. The Company agrees that during the term of this
Agreement and for two years after this Agreement terminates, neither the
Company nor any of its affiliates will directly or indirectly, (a) offer to
employ any employee of RIR or any of its affiliates, (b) introduce any
employee of RIR or any of its affiliates to any other potential employer that
wishes to employ any employee of RIR or any of its affiliates,
or (c) otherwise interfere with the employment relationship between RIR or any
of its affiliates and any of their employees.
6. Independent Contractor. RIR and the Company understand and agree that
RIR is an independent contractor and is not authorized to obligate or commit
the Company in any manner.
7. Confidentiality. XXX agrees to use reasonable efforts to preserve the
confidentiality of any proprietary or confidential information disclosed
to RIR by the Company. Such obligation shall terminate upon the
earlier to occur of: (i) RIR is required to disclose such information to a
third party pursuant to any applicable law or the order of any court or
tribunal of competent jurisdiction, provided that RIR provides prior written
notice to the Company so as to enable the Company to seek a protective order
or such other protection as Company is lawfully entitled; (ii) such
information is in the public domain by publication or otherwise, other than by
breach of this Agreement by RIR or (iii) the third anniversary of the
termination of this Agreement.
8. Gift Policy. RIR's employees may not accept any type of gift or
gratuity (including stock or rights to acquire stock), regardless of value,
from any of RIR's clients, except for (i) unsolicited promotional materials of
nominal value such as pens and calendars and (ii) unsolicited consumable items
such as cakes and cookies that a client may choose to send to RIR during the
holidays.
9. Entire Agreement. This Agreement constitutes the entire agreement
between RIR and the Company with respect to investor relations services. This
Agreement supersedes all prior agreements or understandings between RIR and
the Company.
10. Amendments. RIR and the Company may amend, supersede or modify this
Agreement only in writing signed by each of RIR and the Company.
11. Governing Law. This Agreement will be governed and construed in
accordance with the laws of the State of New York without regard to any
principles of conflicts of laws.
12. Counterparts. RIR and the Company may execute this Agreement in two
counterparts, each of which will be considered an original but all of which
together will constitute one and the same instrument.
If this Agreement correctly describes our understanding, please sign the
enclosed copy of this letter where indicated. Please return the signed
Agreement to us together with the initial monthly fee of $6,000. We look
forward to a long and mutually productive relationship.
Sincerely yours,
XXXXXXXXXX INVESTOR RELATIONS, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxxx
______________________________
Name: Xxxxxxx X. Xxxxxxxxxx
Title: President
Agreed and Accepted as of
the date first written above:
GK Intelligent Systems
By: /s/ Xxxx Xxxxxxx
_____________________________
Name: Xxxx Xxxxxxx
Title: President
September 15, 2004
Xxxx Xxxxxxx, President
GK Intelligent Systems
0000 Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
____________________________________________________________________________
For investor relations services to be rendered during the period of September
15- October 15, 2004.
$6,000
