EXHIBIT 5
AGREEMENT
THIS AGREEMENT dated as of May 17, 2002 is by and among Xxxxxxxx X.
Xxxxx ("LEEDS"), Xxxxxxx Xxxxxx ("XXXXXX") and Summit Brokerage Services, Inc.
("SUMMIT").
WHEREAS, Leeds loaned $100,000 to Xxxxxx pursuant to a promissory note
dated March 15, 2002 (the "NOTE") for use by Xxxxxx to purchase 1,000,000
shares (the "XXXXXX SHARES") of the common stock, $.0001 par value, of Summit
(the "COMMON STOCK");
WHEREAS, Leeds loaned $150,000 to Xxxxxx pursuant to a promissory note
effective March 28, 2002 (the "SECOND NOTE") for use by Xxxxxx to purchase
1,500,000 shares (the "ADDITIONAL XXXXXX SHARES") of Common Stock;
WHEREAS, Xxxxxx secured the indebtedness referenced above by executing
and delivering to Leeds (i) as to the $100,000 loan, a Pledge Agreement dated
March 15, 2002 (the "PLEDGE AGREEMENT") whereby Xxxxxx pledged to Leeds
3,500,000 shares of Common Stock, including the Xxxxxx Shares, and (ii) as to
the $150,000 loan, an amendment to the pledge agreement effective March 28,
2002 (the "PLEDGE AMENDMENT") whereby Xxxxxx pledged to Leeds the Additional
Xxxxxx Shares (all such shares of Common Stock pledged under the Pledge
Agreement and the Pledge Amendment are hereinafter referred to as the "PLEDGED
SHARES");
WHEREAS, Leeds, Xxxxxx and Summit executed and delivered a Stock
Purchase Agreement dated as of March 22, 2002 (the "STOCK PURCHASE AGREEMENT")
whereby, upon the satisfaction of certain conditions contained therein on or
before May 15, 2002, as extended by that certain letter agreement dated as of
the date hereof, (i) Leeds agreed to purchase, and Xxxxxx agreed to sell, the
Xxxxxx Shares in exchange for cancellation of the Note and termination of the
Pledge Agreement and (ii) Leeds agreed to purchase, and Summit agreed to issue
and sell, 4,000,000 shares (the "COMPANY SHARES") of Common Stock in exchange
for $400,000 (the "PURCHASE PRICE");
WHEREAS, in connection with the execution and delivery of the Stock
Purchase Agreement, Summit and Leeds executed and delivered an Escrow Agreement
with Xxxxxxxxxx Xxxxxxxx LLP ("KS") and Xxxxxxxxx Xxxxxxx, P.A. ("GT") whereby
the Company placed the Company Shares in escrow with GT and Leeds placed the
Purchase Price in escrow with KS;
WHEREAS, Xxxxxx now desires to borrow from Leeds, and Leeds agrees to
loan to Xxxxxx, an additional $100,000 for use to purchase an additional
1,000,000 shares of Common Stock from Summit (the "THIRD ROUND SHARES"); and
WHEREAS, in order to facilitate the new borrowing and to coordinate it
with the transactions contemplated by the Stock Purchase Agreement, the parties
hereto desire KS to distribute to Xxxxxx (or his designees described below) on
behalf of Leeds $100,000 of the Purchase Price being held in escrow, and for GT
to release to Xxxxxx on behalf of Summit 1,000,000 shares of the Company
Shares, thereby reducing the amount of Purchase Price in escrow to $150,000 and
the amount of Company Shares in escrow to 1,500,000.
NOW, THEREFORE, for and in consideration of the premises, and the
mutual covenants and agreements contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:
1. Agreements. Concurrent with the execution and delivery
hereof,
(a) Xxxxxx shall execute and deliver to Leeds a
Promissory Note in the principal amount of $100,000, in the form attached
hereto as Exhibit A (the "THIRD NOTE");
(b) Xxxxxx shall execute and deliver a second amendment
to the Pledge Agreement, to increase the number of Pledged Shares from
5,000,000 to 6,000,000, in the form attached hereto as Exhibit B, and Xxxxxx
hereby expressly agrees that his obligations under the Third Note are covered
by and subject to the security interest created by the Pledge Agreement;
(d) The Stock Purchase Agreement is hereby amended to
(i) reduce the Company Shares from 2,500,000 to 1,500,000, (ii) increase the
Xxxxxx Shares therein by the amount of Third Round Shares, that is from
2,500,000 to 3,500,000, (iii) reduce the Purchase Price for Company Shares from
$250,000 to $150,000, and (iv) permit the cancellation of the Third Note in
connection with the purchase by Leeds of the Third Round Shares now included as
part of the Xxxxxx Shares; and
(e) The parties hereto hereby direct (i) KS to release
from escrow and deliver to Summit an amount equal to $100,000, such delivery
being on behalf of Leeds as a loan to Xxxxxx under the Third Note and on behalf
of Xxxxxx as payment to Summit for the Third Round Shares, and (ii) GT to
release from escrow and deliver to Leeds certificates representing 1,000,000
shares of Common Stock, such delivery being on behalf of Summit to constitute
the Third Round Shares purchased by Xxxxxx and on behalf of Xxxxxx to satisfy
his obligation to pledge the Third Round Shares to Leeds to perfect his
security interest therein pursuant to the Pledge Agreement, as amended.
2. Miscellaneous.
(a) This Agreement shall be governed by and construed in
accordance with the internal substantive laws of the State of Florida,
regardless of the laws that might otherwise govern under applicable principles
of conflicts of law or choice of law.
(b) This Agreement may be executed in counterparts, each
of which shall be deemed to be an original, but all of which together shall
constitute one instrument.
(c) Nothing herein is intended or shall be construed to
confer upon any person or entity other than the parties hereto and their
successors and assigns, any rights or remedies under or by reason of this
Agreement.
(d) Neither this Agreement, nor any of the obligations
contained herein, may be assigned by the parties hereto without the prior
written consent of the other parties hereto, which consent may be withheld in
such party's sole discretion.
(e) This Agreement, together with the documents
referenced herein, constitutes the sole and entire agreement of the parties
hereto with respect to the subject matter hereof, and supercedes all prior
discussions and agreements between the parties with respect to the subject
matter hereof. This Agreement shall not be altered or amended except by an
instrument in writing signed by or on behalf of the party entitled to the
benefit of the provision against whom enforcement is sought.
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement as of the date first above written.
"LEEDS"
/S/ XXXXXXXX X. XXXXX
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XXXXXXXX X. XXXXX
"XXXXXX"
/S/ XXXXXXX XXXXXX
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XXXXXXX XXXXXX
"SUMMIT"
SUMMIT BROKERAGE SERVICES, INC.
By: /S/ XXXXXXX XXXXXX
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Name:
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Its: CEO
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