AGREEMENT FOR PUBLIC AND BROKER RELATIONS
This Agreement ("Agreement") is made this 2nd day of October,
1998 by and between MDC Group, Inc., a Colorado corporation
("MDC"), and Delta Petroleum Corporation, a Colorado corporation
("Delta").
WHEREAS, MDC provides consulting services designed to heighten
awareness of the business conducted and performance results
achieved by specific companies among licensed broker/dealers in the
United States of America, which services consist primarily of 1)
organizing and assembling information provided to MDC by the
Company in a format which profiles the Company and which is
conducive to dissemination in appropriate information channels and
networks, and 2) disseminating such information; and
WHEREAS Delta wishes to engage MDC to provide such services,
the manner and substance of which are more specifically described
herein.
NOW THEREFORE, in consideration of the mutual premises and
covenants contained herein, and for such other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1) Information to be Furnished by Delta to MDC.
Delta shall furnish to MDC all current public information
about Delta including all reports, with exhibits, filed by Delta
with the United States Securities and Exchange Commission ("the
Commission"). Delta shall not provide to MDC any confidential or
non-public information about Delta. Delta shall be responsible to
assure that the information provided to MDC accurately and fairly
represents the financial conditions and results of operations of
Delta and shall update the information as necessary from time to
time to assure that it continues to accurately and fairly represent
the financial condition and results of operations of Delta.
In the absence of its own negligence or affirmative
misconduct, MDC shall have no liability for any misstatement or
omission in Delta information, and Delta shall be obligated to
indemnify and defend MDC against any claim, action or proceeding
brought by any party against MDC asserting such third party has
been injured or suffered a loss as a result of any such
misstatement or omission in the information provided by Delta.
Delta shall be fully responsible to assure that Delta's common
stock is legally qualified for secondary trading in all
jurisdictions where the information is disseminated. MDC shall be
obligated to indemnify and defend Delta against any claims, action
or proceedings brought by any party against Delta asserting such
third party has been injured or suffered a loss as a result of any
information disseminated by MDC that was not previously approved by
Delta, or was inaccurately disseminated as a consequence of MDC's
negligence or affirmative misconduct.
MDC shall have no liability or responsibility for any failures
of information to comply with any applicable laws, rules or
regulations or for failure with any applicable laws, rules or
regulations or for failure of Delta's common stock to be duly
qualified for secondary trading under the laws of applicable
jurisdiction.
2) Services to be Provided by MDC.
MDC shall exercise its best efforts to identify and establish
appropriate informational channels and networks capable of
maximizing dissemination of Delta's information to licensed brokers
and dealers in the United States of America with the resources and
inclination to establish and maintain a secondary trading market in
Delta's common stock in jurisdictions where it has been legally
qualified for secondary trading. MDC shall also exercise its best
efforts to assemble and organize Delta's information in a format
and medium which best facilitates dissemination through such
channels and networks, and shall further exercise its best efforts
to instigate and facilitate such dissemination.
Without limiting the generality of the foregoing, the
following procedures will be followed for preparation and
dissemination of any literature incorporating Delta's information:
(a) MDC will prepare proofs of brochures, advertising
materials and other literature incorporating the information as
selected and directed by Delta, and MDC shall present such proofs
to Delta for its review prior to publication;
(b) MDC shall make all corrections and changes in the proofs
requested by Delta. Such corrections and changes shall be
accomplished by Delta's written consent to the publication thereof,
subject to incorporation of such corrections and/or changes. MDC
shall not distribute any information with respect to Delta without
Delta's written consent.
In addition to the foregoing, for each six month period of the
Agreement, MDC shall provide for the publication, printing and
dissemination of the Delta information, at MDC's sole cost, in
publications or through direct mailings, with the printed material
and lists of recipients acceptable to Delta, in a program as set
forth below:
(a) MDC will provide for the printing, publication and
mailing of at least 700,000 pieces of direct mail and/or the
inclusion in national financial publications acceptable to Delta in
the form of one to four page advertorials.
(b) MDC will provide for the printing and dissemination of
10,000 corporate profiles which may be disseminated pursuant to
inquiries and otherwise;
(c) MDC will produce a nucleus of 10 to 12 retail brokers,
market makers and/or money managers who will take positions in the
publicly traded stock of Delta.
(d) MDC represents that it has a significant broker network
and that it will distribute Delta information and disseminate Delta
leads to the brokers in this network.
3. Term
This Agreement shall be for the period of one year from the
date hereof unless earlier terminated as provided herein.
4. Compensation for Services.
(a) Delta will issue 350,000 shares of restricted Delta
common stock to MDC upon execution of this Agreement. Of those
shares 250,000 shares shall be compensation for the first six month
period of the Agreement and 100,000 shares shall be compensation
for the second six month period of the Agreement. Prior to the end
of the first six month period, Delta may elect to terminate the
Agreement for the second six month period in which event MDC will
return 100,000 shares of the common stock to Delta.
(b) In addition to the restricted common stock referenced
above in 4.(a), Delta will issue the following options to MDC:
NUMBER
PRICE OF OPTIONS DURATION
$2.50/share 25,000 90 days
2.75/share 25,000 90 days
3.00/share 50,000 90 days
3.25/share 50,000 90 days
3.50/share 50,000 90 days
3.75/share 50,000 90 days
4.00/share 50,000 6 mos.
4.50/share 50,000 6 mos.
5.00/share 50,000 9 mos.
5.50/share 50,000 1 yr.
6.00/share 50,000 1 yr.
Total 500,000
All Options granted shall vest immediately. The periods
indicated under the column headed "Duration" shall commence upon
the effectiveness of a registration statement filed with the SEC
covering the shares underlying the Options. Notwithstanding the
duration of the periods indicated, all unexercised Options shall
expire on December 31, 1999 regardless of whether or not the
underlying shares have been or are then covered by an effective
registration statement.
(c) Within 30 days of the effective date of this Agreement,
Delta will include 250,000 of the above referenced shares in and
all of the options in a registration statement filed with the
Commission and will use commercially reasonable efforts to cause
the registration to become
effective. Provided that the Agreement has not been terminated,
within 30 days of beginning of the second six month period of this
Agreement Delta will include the remaining 100,000 of the above
mentioned shares in a registration statement filed with the
Commission and will use commercially reasonable efforts to cause
the registration to become
effective.
(d) Notwithstanding any provision set forth above, MDC shall
not at any time be deemed to have the right to acquire any Delta
shares under circumstances which would cause MDC and/or its
affiliates to become the beneficial owner of an amount of Delta
shares that would be in excess of 9.9% of Delta's then issued and
outstanding shares. Without limiting the generality of the
foregoing, no option to purchase Delta's common stock shall be
delivered to MDC and/or be exercisable by MDC if the option, when
combined with shares of Delta's common stock owned by MDC or its
affiliates, on such date will cause MDC to own, or be able to own
by exercise of the options, 9.9% or more of Delta's outstanding
common stock; if vesting and/or delivery of any option would have
such effect, the number of shares issuable upon exercise of such
option shall automatically be reduced prior to delivery so that
upon exercise MDC's ownership of Delta's outstanding common stock
will at no time exceed 9.9%; any reduced portion of the option
shall not vest in MDC until the first date when its vesting will
not increase MDC's ownership of Delta shares to 9.9% or greater;
MDC shall inform Delta of its ownership of Delta's securities prior
to each Vesting Date so that the calculations required hereby can
be timely made.
5. Representations and Warranties.
MDC represents and warrants that services to be provided and
materials to be produced or developed by MDC under this Agreement
will be performed, produced or developed by competent, trained
personnel in a workmanlike manner. MDC and its personnel shall
comply with all applicable statutes, rules and regulations
governing all aspects of the services to be performed under this
Agreement; provided that, as described in paragraph 1 of this
Agreement, Delta shall be fully responsible to assure all the
information is accurate and complete and complies with the
applicable laws, rules and regulations of each jurisdiction where
it is to be disseminated by MDC, and that Delta's common stock is
legally qualified for secondary trading under the laws, rules and
regulations of each such jurisdiction. Delta understands and
acknowledges that, subject to the obligations of MDC as specified
in paragraph 2 above, MDC cannot guarantee objective results or
fulfill any specified goals. OTHER THAN THE FOREGOING EXPRESS
WARRANTIES, MDC MAKES NO WARRANTIES WITH RESPECT TO THE QUALITY OF
THE GOODS AND SERVICES TO BE PROVIDED HEREUNDER OR ANY RESULTS TO
BE ACHIEVED, AND HEREBY EXPRESSLY DISCLAIMS THE EXISTENCE OF ANY
SUCH REPRESENTATIONS AND WARRANTIES, INCLUDING WITHOUT LIMITATION,
ANY IMPLIED WARRANTIES OR MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE.
6. Personal Services of Xxxxx Xxxxxxxxx.
The parties hereto agree that the personal services of Xxxxx
Xxxxxxxxx of MDC are material to performance by MDC under this
Agreement and that in the event he is not available to perform
and/or provide the services of MDC under this Agreement that Delta
may terminate this Agreement and that the parties will agree upon
an equitable return to Delta of all or a portion of the
compensation provided to MDC considering performance and provision
of services by MDC up to the date of termination. It is provided,
however, that MDC may subcontract other parties to perform services
if the parties are supervised by Xxxxx Xxxxxxxxx and approved by
Delta.
7. Stock Voting Agreement.
MDC will execute the Stock Voting Agreement attached hereto as
Exhibit A.
8. Miscellaneous.
This Agreement shall be interpreted and construed in accordance
with the laws of the State of Colorado. The parties agree that
jurisdiction and venue of any dispute arising hereunder shall be in
a the court of general jurisdiction located in the Denver, Colorado
metropolitan area. Neither party may assign its rights or duties
under this Agreement without the express prior written consent of
the other party.
This Agreement contains the entire understanding of the parties
with respect to the subject matter hereof. The terms of this
Agreement may be altered only by written agreement between the
parties. The failure of either party to object to or take
affirmative action with respect ot any conduct of the other which
is in violation of the terms of this Agreement shall not be
construed as a waiver of the violation of breach, or of any future
similar violation or breach.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed by its duly authorized officer as of the
date first written above.
DELTA PETROLEUM CORPORATION
a Colorado corporation
By: s/Xxxxxx X. Xxxxxx, Xx.
Authorized Officer
MDC GROUP, INC.
a Colorado corporation
By: s/Xxxxx Xxxxxxxxx
Authorized Officer
EXHIBIT A
STOCK VOTING AGREEMENT
THIS VOTING AGREEMENT, executed and effective this 1st day of
October 1998, is by, between DELTA PETROLEUM CORPORATION, a
Colorado corporation ("Delta"), MDC GROUP, INC. ("Shareholder"),
Xxxxx X. Xxxxxx ("RAP") and Xxxxxx X. Xxxxxx, Xx. ("AHL").
WHEREAS, Shareholder has acquired at this date an aggregate of
350,000 shares of the issued and outstanding common stock of Delta
and may now or in the future acquire and/or own additional shares
(collectively the "Shares").
NOW, THEREFORE, in consideration of the mutual agreements of
the parties hereto and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the
parties hereto agree as follows:
1. Shareholder contemporaneously herewith owning the Shares,
hereby constitutes and appoints AHL and RAP, and each of them, with
full power of substitution, for the period commencing on the date
hereof and ending on December 31, 2002, to vote the Shares as the
proxy of Shareholder, at any and all meetings, regular or special,
of the shareholders of Delta, or at any adjournments thereof, which
may be held during such period, hereby granting to said AHL and
RAP, and each of them (the "Proxies"), as Shareholder's attorney
and proxy, all powers Shareholder would possess if personally
present at any such meetings. The proxy granted hereby is
expressly acknowledged to be coupled with an interest and shall be
irrevocable to the full extent permitted by law until December 31,
2002, except to the extent specifically provided in Paragraph 3
below. The proxy granted hereby revokes any other proxy relative
to the Shares heretofore granted by Shareholder. Shareholder
agrees that this proxy shall also apply to any shares acquired in
the future prior to December 31, 2002 or, in the alternative, that
shareholder, upon acquisition, will execute additional agreements
identical to this one for any such shares.
2. During the entire term of this Agreement, the Proxies,
and each of them, shall have full and absolute discretion as to the
manner in which Shares are to be voted as to any matter whatsoever,
all without any liability or obligation of any kind to Shareholder.
3. Nothing contained herein shall be construed in such a
manner so as to prohibit or preclude the sale or exchange of all or
any part of the Shares by Shareholder in accordance with the
provisions of this Paragraph 3. In the event that all or any
portion of the Shares are sold, assigned or exchanged by
Shareholder (and/or its assigns) in any transaction other than a
public resale to non-affiliated persons or entities prior to
December 31, 2002, then transferred shares shall remain subject to
the voting restrictions set forth herein subsequent to the transfer
unless otherwise agreed to in writing.
4. A counterpart of this Agreement shall forthwith be
deposited with Delta at its principal place of business.
5. This Agreement shall be construed in accordance with the
laws of the State of Colorado and shall be binding upon the
successors and assigns of each party hereto.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date set forth above.
DELTA PETROLEUM CORPORATION
By: s/Xxxxxx X. Xxxxxx, Xx
Authorized Officer
s/Xxxxxx X. Xxxxxx, Xx.
Xxxxxx X. Xxxxxx, Xx.
s/Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx
SHAREHOLDER:
MDC GROUP, INC.
s/Xxxxx Xxxxxxxxx
Authorized Officer, President
