EXHIBIT 10.5
THE BOSPHOROUS GROUP, INC.
000 XXXXX XXXXXX XXXXXX, XXXXX 000
XXXXXX XXXX, XXXXXX 00000 XXX
XXXXXXXX@XXXXXXXXXX.XXX
INDEPENDENT CONSULTING AGREEMENT
This Agreement is made this 1st day of October 2003 by and between Centergistic
Solutions, Inc., a California corporation (CSI), and The Bosphorous Group, Inc.,
a Nevada corporation (TBG).
TBG agrees to serve CSI and its owners, shareholders and affiliates, as
investment banking consultants in an effort to assist CSI in the listing of its
shares on a stock exchange, the sale of its business, the private or public
placement of financing, debt, common or preferred stock ("the financing").
Accordingly, the parties agree as follows:
1. TBG will work closely with CSI executives as requested to
provide advisory consulting services to CSI on a progressive basis
for the following anticipated six phases of the assignment,
including but not limited to: I. Preparation and Packaging to create
an Investor Information Memorandum and PowerPoint for preliminary
broker and investor selection; II. Broker and Investor Introduction
Presentations to obtain indications of public listing and funding
interest; III. Broker Selection and Engagement for public listing
and funding commitment; IV. Listing Preparation with the broker,
including an analyst's research report and the SEC as well as the
exchange's application document; V. Syndicate Selling with the
broker to solicit subscriptions for the funding through a road show;
VI. Listing and Secondary Funding of CSI's shares on a stock
exchange with the broker and subsequent investors in a secondary
fundraise or other transaction.
2. CSI will hire TBG's Xxxxxx X. XxXxxxx as an employee and pay
XxXxxxx US$1,000 per month, as well as pay the costs of
participation in CSI's medical benefits program for XxXxxxx and his
family. CSI will pay TBG a nonrefundable Success Advisory Fee of
US$12,500 upon receipt by CSI of US$1,000,000 or greater in
financing following the date of this Agreement. CSI will pay TBG a
second nonrefundable Success Advisory Fee of US$12,500 upon receipt
by CSI of US$2,000,000 or greater in aggregate financing following
the date of this Agreement. Finally, CSI will pay TBG a third
nonrefundable Success Advisory Fee of US$12,500 upon receipt by CSI
of US$3,000,000 or greater in aggregate financing
following the date of this Agreement. Each of these three Success Advisory
Fees of US$12,500 shall be payable in registered and unrestricted stock of
CSI, calculated at the rate of US$3.18 per share, based on the most recent
financing completed by CSI prior to the date of this Agreement, and as
adjusted for splits. In addition, CSI shall pre-pay or reimburse TBG for
all reasonable business expenses, providing such expenses are approved in
advance by CSI. CSI shall reimburse TBG within 15 days of presentation of
such expenses.
3. CSI will have the absolute right to accept or reject any offer
received from prospective sponsoring investment banks, investors,
partners, or merger proposals submitted by TBG. Finders' Fees as
defined below shall be payable by CSI to TBG only if a transaction
initiated or completed by TBG is consummated.
4. This Agreement shall be in effect from the date first written
above and continue thereafter for nine (9) months. However, it may
be terminated by either party with 30 days written notice.
5. TBG shall use its best efforts to negotiate with prospective
sponsoring brokers, investment banks, investors and partners. CSI
will furnish material in the form of a draft offering document,
based on information compiled and supplied by CSI.
6. During the term of this agreement, and for 18 months following
termination, CSI agrees to pay TBG a Finders' Fee in cash at the
closing of the sale or financing between CSI and purchasers,
investors, lenders and affiliates introduced to CSI by TBG. The
purchasers, lenders and affiliates must directly invest in CSI, and
not through any party other than TBG. The 5% Finders' Fee shall be
determined by multiplying 0.05 times the gross purchase price in the
event of the sale of the CSI business, or times the proceeds
received by CSI from investors or lenders introduced by TBG.
7. During the term of this agreement, and for 18 months following
termination, CSI agrees to issue to TBG Finders' Fee warrants to
purchase common stock in an amount equal to 5% of the debt, common
or preferred stock purchased as a result of each financing by an
investor introduced to CSI by TBG. The purchasers, lenders and
affiliates must directly invest in CSI, and not through any party
other than TBG. Such warrants shall have an exercise term of 5 years
from the date of issuance, shall allow for their cashless exercise,
and shall be exercisable at a price equal
to the price per share of the financing from the TBG-introduced
investor.
8. Notwithstanding the above, at TBG's discretion, any portion of
the amounts listed above in the Finders' Fee section 6 may be
applied toward the purchase of unrestricted, freely-tradable CSI
stock, subject to any restrictions placed by an underwriter, at the
then-current round price.
9. During the negotiations of this agreement, TBG can seek to
obtain interest from potential listing sponsors and investment
candidates. CSI agrees not to circumvent TBG by attempting to
contact or deal directly with any parties referred or introduced by
TBG, for a period of 18 months, unless TBG authorizes and approves
such in writing.
10. CSI shall indemnify TBG, its officers, directors, employees, and
agents for any liability, claim, or expense, including any
reasonable attorney's fees, arising out of or in connection with
this agreement or the services of TBG hereunder, except to the
extent attributed to the negligence or willful misconduct of TBG.
11. TGB shall indemnify CSI, its officers, directors, employees, and
agents for any liability, claim, or expense, including any
reasonable attorney's fees, arising out of or in connection with
this agreement or the services of TBG hereunder, except to the
extent attributed to the negligence or willful misconduct of CSI.
12. This agreement shall be interpreted under the laws of the State
of California. Any controversy, dispute or claim between the parties
relating to this agreement shall be resolved by binding arbitration
in accordance with the rules of the American Arbitration Association
in Orange County, California.
13. TBG undertakes no representation, express or implied, that it
will effect the sourcing of investment partners as a result of this
agreement. The duties of TBG shall not include legal and accounting,
which shall be prepared by CSI at its own expense. CSI shall furnish
TBG complete, accurate and historic business information and shall
promptly inform TBG of any changes, which may materially affect its
business or TBG services under this agreement.
14. By signing this agreement, CSI's signing party represents that
he has the unconditional authority of its Board of Directors to
enter into this agreement on behalf of CSI.
15. This is the entire agreement between the parties pertaining to
its subject matter and supersedes all prior agreements,
representations, and undertakings of the parties. No modifications
of this agreement shall be binding unless agreed in writing by the
parties.
Please indicate your acceptance of this agreement by executing and returning the
enclosed copy.
CENTERGISTIC SOLUTIONS, INC. THE BOSPHOROUS GROUP, INC.
BY:____________________ BY:_____________________
XXXXXXX X. XXXXXXXX XXXXXX X. XxXXXXX
CHAIRMAN AND CEO PRESIDENT
DATE:__________________ DATE:___________________
