Exhibit 10.1 Agreement for Professional Services with Xxxxxxx X. Xxxx
WEED & CO. L.P.
0000 XXXXXXXXX XXXXX, XXXXX 0000, XXXXXXX XXXXX, XXXXXXXXXX 00000-0000
TELEPHONE (000) 000-0000 FACSIMILE (000) 000-0000
WRITER'S DIRECT NUMBER
(949) 475-9086 ext. 6
April 27, 2001
Xx. Xxxxxx X. Xxxxxxx
Chief Operating Officer
VentureNet Capital Group, Inc.
00000 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Telephone 000.000.0000
Facsimile 909.296.9947
RE: Special Projects
Dear Xx. Xxxxxxx:
The purpose of this letter is to set forth the terms and conditions that will
govern our relationship.
This agreement for professional services is between VentureNet Capital Group,
Inc., a Delaware corporation ("Client") whose address is 00000 Xxxxxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxxxx 00000 and Weed & Co. L.P. ("Weed") whose address
is 0000 XxxXxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx Xxxxx, Xxxxxxxxxx 00000.
Weed agrees to provide professional services to Client with respect to certain
capital formation, business strategy and legal affairs referred to Weed by
Client from time to time. This agreement is made to document the conditions and
guidelines that will govern the relationship between the parties. The initial
special projects involve the following items.
ADVISE THE CLIENT REGARDING A REVERSE SPLIT OF ITS COMMON STOCK AND ADJUSTMENTS
TO ITS CAPITAL STRUCTURE, IMPLEMENT THE ADJUSTMENT TO THE CAPITAL STRUCTURE,
INCLUDING BOARD RESOLUTIONS, SHAREHOLDERS MEETING AND SCHEDULE 14C FILING WITH
THE SEC, INTERACTION WITH NASD TO IMPLEMENT THE REVERSE SPLIT, OBTAIN NEW CUSIP
NUMBER, POSSIBLE DISTRIBUTION OF WARRANTS OR RIGHTS TO EXISTING SHAREHOLDERS,
REVIEW, ANALYSIS AND ADVICE TO THE CLIENT REGARDING OTHER BUSINESS
OPPORTUNITIES, POSSIBLE RESOLUTION OF CLAIMS BY NOTEHOLDER.
To protect both of the parties and to comply with professional obligations, we
have already discussed with each other and resolved any potential conflicts of
interest with present or former clients. The services that Weed will provide
shall be in accordance with the following terms and conditions.
PROFESSIONAL FEES
Fees will be based upon the reasonable value of Weed's services as determined in
accordance with the American Bar Association Model Code of Professional
Responsibility and the California & Texas Rules of Professional Conduct. Fees
will be based on the rates charged by Weed.
Weed's rate is $300 per hour. It is anticipated that Client and Weed will agree
on a fixed fee for special projects from time to time. The fixed fee
arrangements for special projects will be agreed to in writing from time to
time.
Client further understands that during the course of Weed's engagement, it may
be necessary or advisable to delegate various portions of this matter to others.
COSTS AND EXPENSES
Client understands that in the course of representation, it may be necessary for
Weed to incur certain costs or expenses. Client will reimburse Weed for certain
costs or expenses actually incurred and reasonably necessary for completing the
assigned matter, as long as the charges for costs and expenses are competitive
with other sources of the same products or services and approved by Client in
advance. More particularly, Client will reimburse Weed in accordance with the
following guidelines:
1. COMPUTER-RELATED EXPENSES - Client will reimburse Weed for computerized
research and research services. However, any charges over $500 per month will
require approval. Client also encourages Weed to utilize computer services that
will enable Weed to more efficiently manage the projects.
2. TRAVEL - Client will reimburse Weed for expenses in connection with out of
town travel. However, Client will only reimburse for economy class travel and,
where necessary, for the reasonable cost of a rental car. All related travel
expenses, i.e., lodging and meals, must be reasonable under the circumstances.
3. FILING FEES & COURT COSTS - Client will reimburse Weed for expenses incurred
in connection with filing fees and court costs, if any, but will not be
responsible for sanctions or penalties imposed due to the conduct of Weed.
BILLING
All bills will include a summary statement of the kinds of services rendered
during the relevant period. Client expects that Weed will maintain back-up
documentation for all expenses. Client expects to be billed monthly or at the
conclusion of each project and expects to pay Weed's invoices as described
below.
PAYMENT
To initiate the relationship Client agrees to deliver a cash retainer fee of
$3,500. As payment for professional services, Client agrees to pay monthly or at
the closing of any applicable transaction. Client shall pay Weed's out of pocket
costs promptly.
As payment for professional services, Client has proposed and Weed has agreed,
that Client place a block of 1,600,000 shares of Client's stock in Weed's name.
At least once a month, Weed will send Client a statement for fees and costs.
Unless objection is made to the xxxx, sufficient stock, net of commission, shall
then be liquidated forthwith at the prevailing market rate to satisfy such
statement.
In the course of Weed's representation of the Client, if all the stock is
liquidated, a new block of stock sufficient to cover projected fees, in an
amount contemporaneously agreed to by the parties, will again be placed with
Weed, under the terms and conditions outlined above. At the conclusion of Weed's
representation of Client and the payment of all final fees and costs, any unused
stock shall forthwith be returned to Client.
Client has agreed to promptly register such blocks of stock pursuant to a
registration statement filed at its own expense.
STOCK OPTION
As an incentive for Weed to represent the Client and to increase Weed's
proprietary interest in the success of the Client, thereby encouraging him to
maintain his relationship with the Company, the Client hereby grants to Weed
options to purchase shares of the Client's common stock. As an initial option,
the Client hereby grants Weed the right to purchase 150,000 shares of the
Client's common stock at a price of $1.50 per share. Further, every six months
following the date hereof that this agreement remains in effect, the Company
shall grant to Weed an option to purchase an additional 50,000 shares of
Client's common stock at a price equal to 125% of the average closing bid price
for the 10 days immediately prior to the date of the grant. All stock options
will expire unless exercised on or before December 31, 2004 or 3 years from the
date of the grant, whichever is later. The options granted will not be subject
to dilution (i.e. no adjustment to the number of shares or the exercise price)
based upon any reverse split of the Client's common stock. Client has agreed to
promptly register the shares of common stock underlying the stock options at its
own expense.
INVOLVEMENT OF CLIENT
Client expects to be kept closely involved with the progress of Weed's services
in this matter. Weed will keep Client apprised of all material developments in
this matter, and will provide sufficient notice to enable a representative to
attend meetings, conferences, and other proceedings.
There may be times when Weed will need to obtain information from Client. All
requests for access to documents, employees, or other information shall be
granted without unreasonable delay.
TERMINATION
Client shall have the right to terminate Weed's engagement by written notice at
any time. Weed has the same right to terminate this engagement, subject to an
obligation to give Client reasonable notice to permit it to obtain alternative
representation or services and subject to applicable ethical provisions. Weed
will be expected to provide reasonable assistance in effecting a transfer of
responsibilities to the new service provider.
DISPUTES
The laws of the State of California shall govern the interpretation of this
agreement, including all rules or codes of ethics that apply to the provision of
services. All disputes between us arising out of this engagement which cannot be
settled, shall be resolved through binding arbitration in Orange County,
California in accordance with the rules for resolution of commercial disputes,
then in effect, of the American Arbitration Association, and judgment upon the
award may be entered in any Court having jurisdiction thereof. It is further
agreed that the arbitrators may, in their sole discretion, award attorneys' fees
to the prevailing party.
If the foregoing accurately reflects our agreement regarding professional
services, please sign and return a duplicate copy of this letter. Thank you in
advance for your prompt attention to this matter. I will also need a copy the
articles of incorporation with any amendments, bylaws, and corporate minutes
during the last 12 months.
Very truly yours,
/s/ Xxxxxxx X. Xxxx
Xxxxxxx X. Xxxx
Managing Director/Special Projects
Approved and Agreed:
VentureNet Capital Group, Inc.
By: Xxxxxxx Xxxxxx
Name: Xxxxxxx Xxxxxx
Title: President
Date: 5-3-01
