Contract
X. X. Xxxxxx and Associates |
|
| 0000 Xxxxxxxxxx Xxxxxx | (000) 000-0000 |
| Charlotte, NC 00000 | (000) 000-0000 (Fax) |
| xxxxxxxx00@xxx.xxx | |
August 10, 2004 |
|
| Xx. Xxxxxx Xxxxxxx, Xx. | |
| Chairman | |
| AmStar Mortgage Corporation | |
| 00000 Xxxxxxxxx Xxxxxxxxx | |
| Suite 800 | |
| Houston, TX 77089 | |
Dear Xx. Xxxxxxx:
This letter agreement (“Agreement”) confirms the terms and conditions of our engagement by AmStar Mortgage Corporation (“Amstar” or the “Company”) to render certain advisory services to and assist in obtaining other required services for the Company.
We have received and reviewed your Business Plan Executive Summary and certain financial information. We understand that AmStar is a Texas corporation, formed on October 12, 2002, actively engaged in the business of originating commercial and mortgage loans and other lending services. Amstar has entered into an agreement with Xxxxxxxxxx.Xxx, Inc., a Nevada corporation (“Peoplesway”) designed to promote the Amstar brand and mortgage services (the “Peoplesway Arrangement”).
As a part of the Peoplesway Arrangement, Xxxxxx has agreed to use its reasonable best efforts to register certain securities with the United States Securities & Exchange Commission under the Securities Act of 1933, as amended. As a result, you require certain financial consulting services pertaining to the market aspects of the intended transaction. To partially fulfill your obligations thereunder, you have engaged us as consultants on the terms set forth herein.
You have engaged our services to obtain counsel to prepare or review substantially all the documentation to be submitted to regulatory authorities and distributed to prospective investors, advise as to compliance requirements, assist in the structure of the plan of corporate finance, and introduce the Company to commercial and merchant banks, investment banks, private funds and other financiers, all as may be necessary or appropriate.
Xx. Xxxxxx Xxxxxxx, Xx.
August 10, 2004
Page Two
1. Services. The services to be performed shall be on a reasonable best efforts basis and may be briefly outlined as follows:
a. Obtain counsel for preparation and drafting of a registration statement to be filed with the United States Securities & Exchange Commission, certain state securities regulatory commissions, and documents necessary to obtain listing on an exchange or in a trading market;
b. Obtain counsel to help determine suitable corporate authorization, resolutions, minutes, and by-laws, including any necessary amendments, change of domicile or associated filings;
c. Obtain counsel to conduct due diligence, document review, document preparation, attendance at board and shareholder meetings, preparation of required shareholder notices and related corporate work necessary to effect the filing;
d. Obtain counsel to filing, review, preparation and/or submission of all exhibits required by Regulation S-B;
e. Obtain counsel to telephone conferences as needed with regulators, auditors, underwriters, consultants and management;
f. Obtain counsel to related and associated conferences, documents and other matters necessary to effect the filing.
g. Obtain counsel for possible letters of intent, placement agent agreements or similar requirements for ongoing corporate financing and/or investment banking relationships.
h. Obtain counsel for preparation of documents necessary for listing to the OTC Bulletin Board;
i. Obtain CUSIP numbers, documents necessary for listings in manuals with Standard & Poors;
j. Obtain CIK number and open Xxxxx account with the SEC;
k. Selection, assistance and application necessary to obtain a transfer agency agreement with a duly qualified transfer agent;
l. Assistance in selection of company auditors, telephone consultation and document review, and related services necessary to procurement of an audit by a PCAOB certified auditor in compliance with Regulation S-X, including payment by us of the costs of an initial audit;
Xx. Xxxxxx Xxxxxxx, Xx.
August 10, 2004
Page Three
m. Introduction to broker/dealers, investor relations experts and other persons; and
n. Furnish such other advisory services necessary or appropriate to consummate the intended transaction, including obtaining counsel to review structure and bylaws of an audit committee sufficient to maintain Xxxxxxxx-Xxxxx compliance.
2. Appearances by Xx. Xxxxxx. We understand that Peoplesway will make X. X. Xxxxxx, its Chairman, available for appearances and attendance at up to four (4) AmStar sponsored events during the first year of this Agreement. Xx. Xxxxxx’x appearances are expected to include such events as lectures, seminars or meetings with prospects, joint venture arrangements, or communications to the investment community. We each agree that Xx. Xxxxxx will be given at least 30 days advance notice and shall be subject to Xx. Xxxxxx’x availability. You agree that all costs of travel (business class or better), accommodations (business class or better), meals and an unallocated per diem expense allowance of $250 per day will be paid by AmStar.
3. Fees. The Company agrees to pay for our services an advisory fee as follows:
a. An Advisory Fee of 200,000 shares of common stock, based on the Company’s proposed capitalization of 13,500,000 total common shares at the time of the filing of the registration statement payable upon execution of this agreement.
These fees will defray the costs of our services and the legal and accounting fees incurred in connection with the filing of a suitable registration statement as outlined in your Strategic Alliance Agreement with Xxxxxxxxxx.xxx, Inc. You may incur other fees which are not included. Examples of such fees might be filing fees with the SEC or state blue sky authorities; initial or annual listings in approved manuals such as Standard & Poor’s; state filing fees or taxes for any changes in corporate structure; printing of stock certificates; fees payable to transfer agents; underwriting discounts, commissions or selling agent fees or expenses, or other fees to third parties, but not the cost of the initial audit.
4. Expenses. The Company agrees to reimburse me for all of its reasonable, documented out-of-pocket costs that may be reasonably incurred in the performance of our duties under this Agreement. Such expenses may include travel, accommodations, telephone, computer, courier and supplies. Except for exigent circumstances, I will seek your prior approval for all sums in excess of $250. All such fees, expenses and costs will be billed as incurred and are payable by the Company when invoiced. Upon expiration of the Agreement any unreimbursed fees and expenses will be immediately due and payable.
Xx. Xxxxxx Xxxxxxx, Xx.
August 10, 2004
Page Four
5. Cooperation and Indemnification. The Company agrees to cooperate fully in providing required documentation for due diligence, assist in the preparation and review of required documentation, and response to regulatory comments. Management must also be reasonably accessible from time to time for personal and telephone conferences.
The adequacy and accuracy of representations concerning the financial condition of the Company, its operations, management, properties and structure are the responsibility and representation of the Company and its management. Any information furnished to us will be deemed to be full, accurate and fair disclosure. In the event that any matter becomes untrue or misleading, even if it was true when the representation was made, you will immediately bring the change of circumstances to our attention. In addition to the payment of fees and reimbursement of fees and expenses provided for above, the Company agrees to indemnify us and our affiliates with regard to the matters contemplated herein.
6. Matters Relating to Engagement. The Company acknowledges that we shall act as an independent contractor, and any duties arising out of its engagement hereunder shall be owed solely to the Company. The Company further acknowledges that we may perform certain of the services described herein through one or more of its affiliates.
The Company recognizes and confirms that in performing its duties pursuant to this Agreement, we will be using and relying on information furnished by the Company (the “Disclosures”), and shall make its officers, directors, employees, independent accountants and legal counsel reasonably available as needed from time to time. The Company insures that all Disclosures furnished shall be accurate and complete in all material respects. If any Disclosure subsequently becomes materially inaccurate, incomplete or misleading you will notify us promptly.
7. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of North Carolina without regard to the conflict of laws provisions thereof.
I must disclose to you that I am an officer and director for Xxxxxxxxxx.Xxx, Inc. (“Peoplesway”) and assisted in the structure of your intended strategic alliance agreement. This association could be construed as a conflict of interest with our representation of you.
Your signature below will indicate our disclosure of these potential conflicts of interest to you and your waiver thereof. Notwithstanding this waiver, we represent and warrant to you that we have the control and authority necessary to assure our independence in the rendering of services and to assure compliance with all applicable ethical standards.
Xxxxxx Xxxxxxx, Xx.
August 10, 2004
Page Five
If you have any questions or comments regarding the contents of these disclosures, please feel free to ask us about these matters at your earliest convenience.
Please confirm that the foregoing correctly sets forth our agreement by signing below in the space provided and returning this Agreement to us.
We look forward to working with you on this exciting engagement.
Very truly yours, |
 |
Xxxxxx X. Xxxxxx |
DRM/ej
AGREED TO AND ACCEPTED
AMSTAR MORTGAGE CORPORATION
By:____________________________
Name: Xxxxxx Xxxxxxx, Xx.
Title: Chairman
