EXHIBIT 4 (a)
CONSULTING AND WARRANT COMPENSATION AGREEMENT
THIS AGREEMENT is executed and made effective this 7th day of July 1997,
between Laptop Solutions, Inc., a Texas corporation (the "Company"), and Wall
Street Financial ("Consultant").
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained in this Agreement, the parties hereto agree as follows:
1. CONSULTATION.
The Company hereby retains the services of Consultant, as an independent
contractor, which retention is accepted and agreed to be performed by
Consultant, subject to and upon the terms and conditions set forth below.
2. TERM.
The term of this Agreement shall begin on the date hereof, and shall
continue for a period of 6 months (or such longer period as the Company and the
Consultant may agree in writing) unless earlier terminated by the Company for
Cause, as defined in Section 6.4 hereof.
3. CONSULTANT'S STATUS.
It is understood and agreed that Consultant shall be at all times and for
all purposes hereunder an independent contractor to the Company and under no
circumstances shall be deemed an employee, partner or joint venturer of or with
the Company. Consultant agrees that he shall not directly or indirectly imply or
represent to others, or permit another to imply or represent to others that
Consultant has any authority to act for, represent or bind the Company in any
matter by virtue of this Agreement.
4. SERVICES OF CONSULTANT.
4.1 Upon the request of the Company, Consultant shall consult with and
advise the Company with respect to matters concerning: (i) investor relations;
(ii) dissemination of quarterly and annual reports as filed by the Company with
the Securities and Exchange Commission; (iii)
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communications with analysts; and (iv) potential acquisitions. Said services
shall not relate to any capital raising transaction.
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4.2 Consultant agrees to exercise its best efforts, skill and
diligence in the performance of its services hereunder and shall perform all
services in a workmanlike fashion.
4.4 Throughout the term of this Agreement, Consultant shall provide
services to the Company on a part-time basis and may perform the same or similar
services for other persons or entities not inconsistent with its undertakings
hereunder.
5. COVENANTS AND ACKNOWLEDGMENTS OF CONSULTANT.
5.1 Consultant covenants and agrees for itself and its Affiliates
(hereinafter defined) that it will not, during the term of this Agreement or
thereafter, communicate, divulge or otherwise disclose to any other person,
firm, association, or corporation, or use, without the express written consent
of the Company, any Confidential Information (hereinafter defined) of the
Company.
5.2 For purposes of this Agreement, Confidential Information shall
mean all information relating to the Company or its subsidiaries provided to the
Consultant in writing except for that information contained (i) in its filings
with the Securities and Exchange Commission and prior press releases or (ii) in
a writing received by the Consultant from the Company which is not marked
"confidential."
5.3 Consultant shall not make an untrue statement of material fact
regarding the Company or omit to state a material fact in the judgment of
Consultant necessary in order to make any statement regarding the Company made
by the Consultant not misleading, PROVIDING, HOWEVER, that the Consultant shall
be entitled to rely on (i) reports filed by the Company with the Securities and
Exchange Commission, (ii) written press releases issued by the Company without
the Consultant's advice or consultation, and (iii) written press releases issued
by the Company with the Consultant's advice or consultation which it has, based
on reasonable investigation, reasonable grounds to believe and believes make no
untrue statement of a material fact and omit to state no material fact necessary
to make any statement made not misleading.
6. COMPENSATION.
6.1 As consideration for all services to be rendered by Consultant
pursuant to Section 4 above, the Company agrees to issue to Consultant Common
Stock Purchase Warrants ("Warrants") exercisable to purchase 50,000 shares of
Common Stock of the Company (25% at $3.00, 25% at $3.25, 25% at $3.75, 25% at
$4.00).
6.2 All 50,000 Warrants shall be exercisable for a period of 1 year
commencing upon the date hereof and expiring on August 7, 1998, unless the
expiration date of the Warrants shall be extended to a later date in writing by
the Company.
6.3 The warrant certificates (the "Warrant Certificates") to be
delivered pursuant to this Agreement shall be in the form set forth as Exhibit
A, with such appropriate insertions, omissions, substitutions and other
variations as required or permitted by this Agreement (Exhibit A to follow).
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6.4 Notwithstanding the foregoing, the Warrants described in Section
6.1 above shall terminate and be of no further legal force or effect if, prior
to their exercise, this Agreement is terminated by the Company for Cause. For
the purposes of this Agreement, the term "for Cause" shall mean (i) Consultant
shall commit a material breach of this Agreement unless such breach shall be
cured by the Consultant within a period of thirty (30) days after written notice
by the Company of such breach, (ii) Consultant, or its officers, directors
and/or employees, are shown to have engaged in any act of fraud or dishonesty
detrimental to the Company, or its subsidiaries, or any of its customers or
clients, or (iii) Consultant has been grossly negligent in the performance of
its duties or responsibilities hereunder.
7. EXPENSES.
Consultant shall be responsible for all of its expenses related to
telephone, mail, printing, press releases, broker meetings, the expenses related
to running its operations, including its employees, affiliates, and general
administrative expenses. The Company will only be responsible for any specific
obligations it requests the Consultant to do which might include travel,
accommodations, broker presentations, etc. The Company will be responsible for
all expenses related to lodging for said Consultants to and from the Company's
different facilities and to and from any locations the Company specifically
requests Consultants to go to. Otherwise the Consultant will pay for all of its
expenses related to its work. The Company will be responsible for providing
copies of its normal printed information.
8. REGISTRATION RIGHTS.
8.1 On or before August 7, 1997, the Company shall cause to be
prepared and filed with the SEC a Registration Statement on Form S-8 or other
appropriate form registering all the shares of Common Stock issuable upon
exercise of the Warrants (the "Registration Statement").
8.2 In connection with the preparation and filing of the
Registration Statement, the Company agrees to (i) use its bests efforts to cause
such Registration Statement to become and remain effective; (ii) prepare and
file with the SEC such amendments and supplements to such Registration Statement
as may be necessary to keep such Registration Statement effective for the entire
period warrants remain outstanding; (iii) furnish to the Consultant such number
of copies of a prospectus, in conformity with the requirements of the Act, and
such other documents as Consultant may reasonably request in order to facilitate
the disposition of the shares of Common Stock; and (iv) use its best efforts, at
the Consultant's request, to register and qualify the shares of such states that
Consultant gives notice to the Company, provided, however, that the Company
shall not be required in connection therewith to (i) qualify generally to do
business in any jurisdiction where it would not otherwise be required to
qualify, (ii) subject itself to any tax or obligation to collect any tax in any
such jurisdiction, or (iii) consent to general services or process in such
jurisdiction. The Consultant agrees to cooperate in all reasonable respects with
the preparation and filing of the Registration Statement.
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8.3 All fees and other expenses incurred in connection with the
registration of the shares of Common Stock underlying the Warrants shall be
borne by the Company, including, without limitation, fees of the Company's legal
counsel, Securities and Exchange Commission filing fees, printing costs,
accounting fees and costs, transfer agent fees and any other miscellaneous costs
and disbursements. The Consultant shall be liable for any and all underwriting
discounts, brokerage commissions or other fees or expenses incurred in
connection with the sale or other disposition by the Consultant of the shares of
Common Stock covered by the Registration Statement.
8.4 To the extent permitted by law, the Company will indemnify and
hold harmless Consultant, including its officers, directors, employees, agents,
and representatives, against any losses, claims, damages, liabilities, or
expenses, including without limitation attorney's fees and disbursements, to
which Consultant may become subject under the Act to the extent that such
losses, claims, damages or liabilities arise out of or are based upon any
violation by the Company of the Act or under the Securities Exchange Act of
1934, or any rule or regulation promulgated thereunder applicable to the
Company, or arises out of or are based upon any untrue or alleged untrue
statement of any material fact contained in the Registration Statement, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or arise out of any violation by the Company of any rule
or regulation promulgated under the Act applicable to the Company and relating
to action or inaction required of the Company in connection with such
Registration Statement; provided, however, that such indemnity contained in this
paragraph shall not apply to any loss, damage or liability to the extent that
same arises out of or is based upon an untrue statement or omission made in
connection with such Registration Statement in reliance upon and in conformity
with information furnished in writing expressly for use in connection with such
Registration Statement by Consultant.
8.5 Except for the obligations of the Company set forth in Sections
8.1 and 8.2 above, all obligations relating to compliance with applicable laws
and regulations governing the distribution of securities in connection with
Consultant's sale of common stock of the Company acquired pursuant to the
exercise of the Warrants shall be the sole obligation of the Consultant.
9. REPRESENTATIONS AND WARRANTIES OF THE CONSULTANT.
The Consultant hereby represents and warrants to the Company that
there are no agreements or binding obligations enforceable against the
Consultant which would be violated by its entering into this agreement or
providing the services to be provided hereunder.
10. INDEMNIFICATIONS.
10.1 The Consultant agrees to indemnify, defend and hold harmless
the Company, and officers, directors, shareholders, agents, employees (hereafter
"Affiliates") of the Company, attorneys, successors and assigns, from and
against, and pay or reimburse each of them for, any and all claims, losses,
damages, judgments, amounts paid in settlement, costs and legal, accounting or
other expenses that any of them may sustain or incur as a result of any
misrepresentation, any inaccuracy in, or any breach of, any warranty or
representation or any non-performance of any covenant or other obligation on the
part of the Consultant contained in this Agreement.
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10.2 The Company agrees to indemnify, defend and hold harmless the
Consultant, and its Affiliates, attorneys, successors and assigns, from and
against, and pay or reimburse each of them for, any and all claims, losses,
damages, judgments, amounts paid in settlement, costs and legal, accounting or
other expenses that any of them may sustain or incur as a result of any
misrepresentation, any inaccuracy in, or any breach of, any warranty or
representation or any non-performance of any covenant or other obligation on the
part of the Company contained in this Agreement.
11. ATTORNEYS' FEES.
In the event there is any litigation or arbitration between the
parties concerning this Agreement, the successful party shall be awarded its
reasonable attorneys' fees and litigation costs, including the costs incurred in
the collection of any judgment.
12. NOTICES.
Any notice, request, instruction, or other document to be given
hereunder by any party hereto to any other party hereto shall be in writing and
delivered personally or by overnight courier or sent by facsimile transmission,
if to Consultant to:
Wall Street Financial
0000 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxx
with a copy to:
Xxxx, Plant, Xxxxx, Xxxxx & Xxxxxxx
0000 Xxxx Xxxxxx
00 Xxxxx 0xx Xxxxxx
Xxxxxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx, Esq.
if to the Company:
Laptop Solutions, Inc.
00000 Xxxxxx Xxxxx Xxxx
Xxxxx 000
Xxxxxxx, XX 00000
Attention: Xxx Xxxxxxx
with a copy to:
Company
Address
City, ST ZIP Attention:
or at such other address for a party as shall be specified by like notice.
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13. PARTIAL INVALIDITY.
If any provisions of this Agreement are in violation of any statute
or rule of law of any state or district in which it may be sought to be
enforced, then such provisions shall be deemed null and void only to the extent
that they may be in violation thereof, but without invalidating the remaining
provisions.
14. NON-ASSIGNABILITY.
14.1 The obligations of the Consultant to perform hereunder shall
not be assignable by it without prior written consent of the Company.
14.2 This Agreement shall be binding upon the respective parties
hereto and their successors and permitted assigns.
15. WAIVER.
No waiver of any breach of any one of the agreements, terms,
conditions or covenants of this Agreement by the Company shall be deemed to
imply or constitute a waiver of any other agreement, term, condition or covenant
of this Agreement. The failure of either party to insist on strict performance
of any agreement, term, condition or covenant, herein set forth, shall not
constitute or become construed as a waiver of the right of either or the other
thereafter to enforce any other default of such agreement, term, condition or
covenant; neither shall such failure to insist upon strict performance be deemed
sufficient grounds to enable either party hereto to forego or subvert or
otherwise disregard any other agreement, term, condition or covenant of this
Agreement.
16. GOVERNING LAW.
This Agreement and the rights and duties of the parties shall be
construed enforced in accordance with the laws of the State of Colorado.
17. FAX/COUNTERPARTS.
This Agreement may be executed by telex, telecopy or other facsimile
transmission, and such facsimile transmission shall be valid and binding to the
same extent as if it were an original. Further, this Agreement may be signed in
one or more counterparts, all of which when taken together shall constitute the
same document.
18. ENTIRE AGREEMENT.
This Agreement constitutes the entire agreement of the parties
hereto with respect to the subject matter hereof. There are no representations,
warranties, conditions or obligations except as herein specifically provided.
Any amendment or modification hereof must be in writing.
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IN WITNESS WHEREOF, the parties to this Agreement have duly executed
this Agreement effective on the day and year first above written.
ENHANCED SERVICES COMPANY
BY: _______________________________
XXXXXXX XXXXXXX, PRESIDENT
WALL STREET FINANCIAL
BY: _______________________________
XXXXX XXXXX, PRESIDENT
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SERVICES PROVIDED BY WALL STREET FINANCIAL
1. Daily communication with existing brokers that are active in the Company's
stock.
2. Introducing our existing broker network to the Company.
3. Research and develop new relationships with brokers and investment banking
firms interested in retailing the Company's stock.
4. Development of a high quality investor package on the Company to be sent out
to brokers and institutional investors.
5. Communicate with research analyst(s) to write research reports on the Company
and distribute with investor package.
6. Develop a corporate profile and include in investor package.
7. Mail, at our own expense, investor packages to interested brokers for the
Company.
8. Meet with brokers in different parts of the country to introduce the Company.
9. Distribute news releases and updates from the Company.
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ENHANCED SERVICES COMPANY, INC.
WARRANT CERTIFICATE
Warrant No. 97-4 Warrant for 12,500 shares of Common Stock,
$.001 par value
THIS WARRANT CERTIFIES THAT, for value received,) Wall Street Financial, a
Texas corporation ("WSF"), is the registered owner of a Warrant entitling WSF,
subject to the terms and conditions hereinafter set forth, to subscribe for,
purchase and receive 12,500 fully paid and non-assessable shares of Common
Stock, $.001 par value (the "Common Stock"), of Enhanced Services Company, Inc.,
a Colorado corporation (the "Company"), subject to modification and adjustment
as set forth herein, upon the presentation and surrender of this Warrant
Certificate at any time prior to the Expiration Date (as hereinafter defined),
at the business office of the Company, and upon payment therefor of the exercise
price ("Exercise Price") of $4.00 per share of Common Stock, subject to
modification and adjustment as set forth herein. If the rights represented
hereby shall not be exercised at or before the Expiration Date, this Warrant
shall become and be void without further force or effect, and all rights
represented hereby shall cease and expire.
This Warrant Certificate and the Warrant represented thereby are issued
pursuant to, and is subject in all respects to the terms and conditions set
forth in the Wall Street Financial 1997 Consulting and Warrant Compensation
Agreement between the Company and WSF dated July 7, 1997 (the "Agreement"), to
which reference is hereby made for the provisions hereof. Unless the context
indicates otherwise, capitalized terms used herein without definition shall have
the meaning ascribed to them in the Agreement.
1. TERM OF WARRANT. The rights evidenced by this Warrant Certificate may
be exercised in whole or in part at any time, commencing upon the issuance
hereof and ending at 5:00 o'clock p.m., Central Time on August 6, 1998 unless
the Company agrees in writing to a later date ("Expiration Date"), except that,
the Warrants shall terminate in the event that the Agreement is terminated for
Cause.
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2. ADJUSTMENTS OF EXERCISE PRICE AND SHARES. If, and to the extent that,
the number of issued shares of Common Stock of the Company shall be increased or
reduced by change in par value, split up, reclassification, distribution of a
dividend payable in stock, or the like, the number of shares subject to the
Warrant and the exercise price per share shall be proportionately adjusted. If
the Company is reorganized or consolidated or merged with another corporation,
WSF shall be entitled to receive warrants covering shares of such reorganized,
consolidated or merged company in the same proportion, at an equivalent price
and subject to the same conditions as the Warrant. Upon the happening of any
event requiring an adjustment of the exercise price or the number of shares
subject to this Warrant hereunder, the Company shall forthwith give written
notice thereto to WSF stating the adjusted exercise price and the adjusted
number of shares purchasable upon the exercise hereof resulting from such event
and setting forth in reasonable detail the method of calculation and the facts
upon which such calculation is based.
3. MANNER OF EXERCISE. WSF may exercise all or any whole number of such
Warrants prior to the Expiration Date in the manner stated herein. WSF must
provide the Company with not less than two (2) business days' prior written
notice prior to the exercise of any of the Warrant. The Exercise price shall be
payable in lawful money of the United States of America. On exercise, this
Warrant Certificate, together with the purchase form provided herein duly
executed by WSF, plus payment of the Exercise Price in cash or by certified
check payable to the order of the Company, shall be surrendered to the Company.
Upon partial exercise of the rights evidenced by this Warrant Certificate, there
shall be issued to WSF a new Warrant Certificate evidencing any unexercised
rights.
4. RESERVATION OF COMMON STOCK. The Company agrees that the number of
shares of Common Stock sufficient to provide for the exercise of the Warrant
upon the basis herein set forth will at all times during the term of this
Warrant be reserved for the exercise thereof.
5. ISSUANCE OF COMMON STOCK UPON EXERCISE. The Company, at its expense,
shall cause to be issued, as soon as practicable, but not later than ten (10)
days after exercise of this Warrant, a certificate or certificates in the name
of WSF reflecting the number of shares of Common Stock to which WSF is entitled
upon such exercise. All shares of Common Stock or other securities delivered
upon the exercise of the Warrants shall be validly issued, fully paid and
non-assessable.
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6. NO RIGHT AS STOCKHOLDER. WSF is not, by virtue of ownership of the
Warrant, entitled to any rights whatsoever of a stockholder of the Company.
7. REDEMPTION. The Company shall not have the right to redeem this
Warrant.
8. ASSIGNMENT. This Warrant MAY NOT be transferred or assigned by WSF
without the Company's prior written approval (which, in its absolute discretion,
it may decline), and any purported transfer or assignment made without the
Company's prior written approval shall be void.
ENHANCED SERVICES COMPANY, INC.
Date: August 7, 1997 By: ________________________________
Xxxxxxx Xxxxxxx, President
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ENHANCED SERVICES COMPANY, INC.
WARRANT CERTIFICATE
Warrant No. 97-1 Warrant for 12,500 shares of Common Stock,
$.001 par value
THIS WARRANT CERTIFIES THAT, for value received,) Wall Street Financial, a
Texas corporation ("WSF"), is the registered owner of a Warrant entitling WSF,
subject to the terms and conditions hereinafter set forth, to subscribe for,
purchase and receive 12,500 fully paid and non-assessable shares of Common
Stock, $.001 par value (the "Common Stock"), of Enhanced Services Company, Inc.,
a Colorado corporation (the "Company"), subject to modification and adjustment
as set forth herein, upon the presentation and surrender of this Warrant
Certificate at any time prior to the Expiration Date (as hereinafter defined),
at the business office of the Company, and upon payment therefor of the exercise
price ("Exercise Price") of $3.00 per share of Common Stock, subject to
modification and adjustment as set forth herein. If the rights represented
hereby shall not be exercised at or before the Expiration Date, this Warrant
shall become and be void without further force or effect, and all rights
represented hereby shall cease and expire.
This Warrant Certificate and the Warrant represented thereby are issued
pursuant to, and is subject in all respects to the terms and conditions set
forth in the Wall Street Financial 1997 Consulting and Warrant Compensation
Agreement between the Company and WSF dated July 7, 1997 (the "Agreement"), to
which reference is hereby made for the provisions hereof. Unless the context
indicates otherwise, capitalized terms used herein without definition shall have
the meaning ascribed to them in the Agreement.
1. TERM OF WARRANT. The rights evidenced by this Warrant Certificate may
be exercised in whole or in part at any time, commencing upon the issuance
hereof and ending at 5:00 o'clock p.m., Central Time on August 6, 1998 unless
the Company agrees in writing to a later date ("Expiration Date"), except that,
the Warrants shall terminate in the event that the Agreement is terminated for
Cause.
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2. ADJUSTMENTS OF EXERCISE PRICE AND SHARES. If, and to the extent that,
the number of issued shares of Common Stock of the Company shall be increased or
reduced by change in par value, split up, reclassification, distribution of a
dividend payable in stock, or the like, the number of shares subject to the
Warrant and the exercise price per share shall be proportionately adjusted. If
the Company is reorganized or consolidated or merged with another corporation,
WSF shall be entitled to receive warrants covering shares of such reorganized,
consolidated or merged company in the same proportion, at an equivalent price
and subject to the same conditions as the Warrant. Upon the happening of any
event requiring an adjustment of the exercise price or the number of shares
subject to this Warrant hereunder, the Company shall forthwith give written
notice thereto to WSF stating the adjusted exercise price and the adjusted
number of shares purchasable upon the exercise hereof resulting from such event
and setting forth in reasonable detail the method of calculation and the facts
upon which such calculation is based.
3. MANNER OF EXERCISE. WSF may exercise all or any whole number of such
Warrants prior to the Expiration Date in the manner stated herein. WSF must
provide the Company with not less than two (2) business days' prior written
notice prior to the exercise of any of the Warrant. The Exercise Price shall be
payable in lawful money of the United States of America. On exercise, this
Warrant Certificate, together with the purchase form provided herein duly
executed by WSF, plus payment of the Exercise Price in cash or by certified
check payable to the order of the Company, shall be surrendered to the Company.
Upon partial exercise of the rights evidenced by this Warrant Certificate, there
shall be issued to WSF a new Warrant Certificate evidencing any unexercised
rights.
4. RESERVATION OF COMMON STOCK. The Company agrees that the number of
shares of Common Stock sufficient to provide for the exercise of the Warrant
upon the basis herein set forth will at all times during the term of this
Warrant be reserved for the exercise thereof.
5. ISSUANCE OF COMMON STOCK UPON EXERCISE. The Company, at its expense,
shall cause to be issued, as soon as practicable, but not later than ten (10)
days after exercise of this Warrant, a certificate or certificates in the name
of WSF reflecting the number of shares of Common Stock to which WSF is entitled
upon such exercise. All shares of Common Stock or other securities delivered
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upon the exercise of the Warrants shall be validly issued, fully paid and
non-assessable.
6. NO RIGHT AS STOCKHOLDER. WSF is not, by virtue of ownership of the
Warrant, entitled to any rights whatsoever of a stockholder of the Company.
7. REDEMPTION. The Company shall not have the right to redeem this
Warrant.
8. ASSIGNMENT. This Warrant MAY NOT be transferred or assigned by WSF
without the Company's prior written approval (which, in its absolute discretion,
it may decline), and any purported transfer or assignment made without the
Company's prior written approval shall be void.
ENHANCED SERVICES COMPANY, INC.
Date: August 7, 1997 By: _________________________________
Xxxxxxx Xxxxxxx, President
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