Best Energy Services, Inc.
September 3, 2010
Xxxxxx Xxxxxxx, Inc.
Attention: Xxxxxx Xxxxxx
Chairman, President and Chief Executive Officer
Two Grand Central Tower
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Consulting/Financial Advisory Agreement
Dear Xx. Xxxxxx:
This letter sets forth the terms of the consulting/financial advisory agreement
between Xxxxxx Xxxxxxx, Inc., a Delaware corporation ("AGI"), and Best Energy
Services, Inc., a Texas Corporation, (hereinafter "BEST" or the "Company") in
connection with AGI acting as a consultant and/or corporate finance advisor to
the Company, its subsidiaries and any new enterprise(s) that may be established
and owned by the Company. For sake of clarity, the parties acknowledge that AGI
has previously provided consulting and corporate finance advisory services for
BEST since approximately December 26, 2007 and, accordingly, the compensation
provided for in Section III hereof includes consideration for all such past
services. Such past services included, among other things:
- Conducting non-deal road shows to accredited and institutional investors;
- Introducing the Company to analysts who write research;
- Introducing a strategic institutional investor to the Company, which led to
a non-affiliated former senior banker of a top tier investment bank joining
the Company's Board;
- Bringing the Company to investor conferences;
- Helping the Company negotiate modifications to its credit facility with PNC
Bank;
- Migrating from a tier three transfer agent to a tier one transfer agent;
- Advising the Company on the selection of a qualified Investor Relations
firm;
- Introducing the company to other broker-dealers that have considered
participating in capital raises for the Company;
- Advising the Company on the process of migrating from the OTCBB to the
American Stock Exchange; and
- Assisting the Company in setting up conference calls with potential
institutional and accredited investors.
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1. All references to BEST or the Company include, by definition, its officers,
directors, employees and agents.
I. RESPONSIBILITIES OF AGI
-----------------------
Subject to the terms and conditions hereof, AGI will continue to provide
corporate finance advisory services, consistent with the aforementioned
services, as requested by the Company.
AGI will use commercially reasonable best efforts in providing such services.
The determination as to whether AGI has used commercially reasonable best
efforts will be determined solely by AGI acting in its own discretion and
judgment.
It is expressly acknowledged and agreed by the parties hereto that AGI and
employees of AGI are independent contractors and are not employees, officers or
directors of the Company.
II. INFORMATION
-----------
In connection with AGI's corporate finance activities on behalf of the Company,
the Company will continue to furnish AGI with all information concerning the
Company ("Information") which AGI reasonably deems appropriate and will provide
AGI with reasonable access to accountants and counsel of the Company. The
Company represents that all Information relating to the Company, including but
not limited to the Company's financial statements, made available to AGI by the
Company will be complete and correct in all material respects and will not
contain any untrue statement of a material fact or omit to state a material fact
necessary in order to avoid making the statements therein misleading. In
rendering its services hereunder, AGI will be using and relying primarily on the
Information without independent verification thereof, and AGI does not assume
responsibility for the accuracy or completeness of the Information.
AGI will accept, hold and keep confidential such Information for its use as
contemplated hereby. AGI only will disclose the Information to prospective
investors or their employees, attorneys, accountants, agents, bankers, or
advisors and consultants who shall reasonably need to know the Information in
order to assist AGI or the Company in discharging the corporate finance advisory
duties hereunder.
The aforesaid confidentiality obligations assumed by AGI hereunder will not
apply to any Information which is presently in or subsequently becomes part of
the public domain or is otherwise generally known through no fault of AGI or is
obtained from any third party which is lawfully in possession and permitted to
provide such Information.
III. COMPENSATION
------------
In consideration of the services as set forth above and the past services
described in the introductory paragraph to this letter agreement, and pursuant
to an offer made initially in approximately May 2009 by the Company to AGI and
the specific compensation terms hereof on August 26, 2010 which AGI hereby
accepts, the Company agrees to issue to
AGI ten (10,000,000) million warrants to purchase the common stock of the
Company at ten ($0.10) cents per share. The form of Warrant is attached hereto
as Exhibit A.
In light of the past services provided by AGI to the Company, the warrants
referred to herein shall be considered irrevocably earned upon execution of this
document by the Company and will be delivered within one (1) business day of
such execution, irrespective of whether XXX has initiated any further
performance hereunder whatsoever.
IV. EXPENSE REIMBURSEMENT
---------------------
The Company agrees to reimburse AGI all amounts due and owing AGI, under the
terms of this Agreement, no later than fifteen (15) days after receiving an
invoice for all customary or reasonable out-of-pocket expenses including but not
limited to, the cost of telephone calls, travel, facsimile transmissions,
translation, interpretation, paper duplication, due diligence reports, postage
and delivery services, and fees and costs of counsel, incurred in connection
with the performance by AGI of its duties contemplated by this Agreement. All
out-of-town travel, counsel or third party consultant fees, and other
significant expenses (over $500), will be subject to Company's advance approval.
The Company will make arrangements directly with, and be responsible for, costs
of accountants, appraisers, counsel and other experts and for the costs of
printing and circulating a business plan, memoranda or other documents as may be
contemplated by or arising out of the corporate finance advisory services
provided hereunder.
V. TERMINATION
-----------
This Agreement shall terminate twelve (12) months from the signing hereof.
VI. INDEMNIFICATION
---------------
The Company agrees to indemnify and hold harmless AGI against any and all
losses, claims, damages, liabilities or costs (including in connection with all
actions in respect thereof and any reasonable legal or other expenses in giving
testimony or furnishing documents in response to a subpoena or otherwise),
including the costs of investigating, preparing or defending any such action or
claim, in connection with any litigation in which AGI is a party or otherwise
required to participate, as and when incurred, directly or indirectly, caused
by, relating to, based upon or arising out of this Agreement, in the performance
of its obligations under this Agreement or any other matter relating to AGI
acting for, or on behalf of, the Company, including, without limitation, any act
or omission by AGI in connection with its acceptance of or of the performance of
its obligations under this Agreement; provided, however, such indemnification
provisions shall not apply to any such loss, claim, damage, liability or cost to
the extent it is found to have resulted from XXX's willful and intentional
misconduct. The Company also agrees that AGI shall not have any liability
(whether direct or indirect, in contract or tort or otherwise) to the Company
for or in connection with the engagement of AGI, except for any such liability
for losses, claims, damages, liabilities or expenses that is found to have
resulted primarily and directly from AGI's willful and intentional misconduct.
This indemnification provision shall be in addition to any liability which a
party may otherwise have to the other party or its affiliates, and the
indemnification provided for herein shall extend to officers, employees, agents,
legal counsel and controlling persons of a party within the meaning of the
Securities Act of 1933, as amended. All references to a party in this
indemnification provision shall be understood to include any of the foregoing.
If any action, proceeding, or investigation is commenced or claim is made as to
which a party proposes to demand indemnification, each party agrees to notify
the other party with reasonable promptness. The indemnifying party reserves the
right to assume the defense of the indemnified party with counsel of its
choosing, which counsel shall be reasonably acceptable to the indemnified party.
The indemnifying party will be liable for any settlement of any claim against
the indemnified party. However, the indemnified party may not settle any claim
without the consent of the indemnifying party.
No person found liable for fraudulent misrepresentation shall be entitled to
contribution from any person who is not also found liable for such fraudulent
misrepresentation.
VII. ENTIRE AGREEMENT
----------------
The parties agree that this Agreement dated above, embodies the entire agreement
and understanding of the parties and supersedes all previous agreements, except
any private placement agent agreements as may be in effect at the time of
execution hereof or may come into effect hereafter, and that no understandings
or agreements, verbal or otherwise, exist between the parties except as set
forth in this Agreement or any private placement agent agreement in effect. Any
modifications to this Agreement must be reduced to writing, signed by both
parties, and attached to the Agreement to be effective.
VIII. SEVERABILITY
------------
Should any section or any part of any section of this Agreement be rendered
void, invalid, or unenforceable by any court of law, for any reason, such a
determination shall not render void, invalid, or unenforceable any other section
or any part of any section in this Agreement.
IX. SURVIVAL OF REPRESENTATIONS
---------------------------
Each Party, for itself, and its successors, heirs, executors, administrators,
representatives, insurers, agents, and assigns, covenants and agrees that all
representations made hereunder and obligations created hereunder shall apply to
their successors and assigns; provided, however, that AGI shall not assign this
Agreement to a third party without the prior written consent of a duly
authorized representative of the Company, which consent shall not be
unreasonably withheld.
X. NOTICES
-------
Any required notices under this Agreement shall be made by overnight courier or
certified mail, postage prepaid and return receipt requested as follows:
If to AGI:
Xxxxxx Xxxxxx
Chairman, President and Chief Executive Officer
Xxxxxx Xxxxxxx, Inc.
Two Grand Central Tower
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
WITH A COPY TO:
Xxxxx X. Xxxxxxxx
General Counsel
Xxxxxx Xxxxxxx, Inc.
Two Grand Central Tower
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
If to the Company:
Mr. Xxxx Xxxxxxxxxx
Chairman and CEO
Best Energy Services Inc.
0000 Xxxxxxxxxx Xxx.
Suite 825
Houston TX 77056
XI. CHOICE OF LAW
-------------
The validity and interpretation of this Agreement shall be governed by the laws
of the State of New York without giving effect to the State of New York's choice
of law principles, and all actions arising under this Agreement or arising out
of the operative facts represented by services performed pursuant to this
Agreement shall be resolved in the federal courts of the State of New York.
XII. HEADINGS
--------
The headings are for informational purposes only and shall not constitute a part
of this Agreement.
XIII. NO WAIVER OF BREACH
-------------------
Waiver of any one breach of the provisions of this Agreement shall not be deemed
a waiver of any other breach of the same or any other provision of this
Agreement.
XIV. INTERPRETATION
--------------
It is the specific intent and Agreement of the parties hereto that the contents
hereof shall be neutrally construed irrespective of which party may be deemed
the drafter of such provision.
Respectfully Submitted:
BEST ENERGY SERVICES, INC.
By: /s/ Xxxx Xxxxxxxxxx
-------------------
Name: Xxxx Xxxxxxxxxx
Title: Chairman and CEO
PLEASE CONFIRM THAT THE FOREGOING CORRECTLY SETS FORTH OUR MUTUAL UNDERSTANDING
AND AGREEMENT BY SIGNING AND RETURNING THE COPY OF THIS AGREEMENT PROVIDED FOR
THAT PURPOSE.
AGREED AND ACCEPTED:
XXXXXX XXXXXXX, INC.
By: /s/ Xxxxxx Xxxxxx
-----------------
Name: Xxxxxx Xxxxxx
Title: Chairman, President and CEO
