CONSULTING AGREEMENT
____________, 1998
Xxxx Xxxxxx Golf, Inc.
0000 Xxxxxxx Xxxxx
Xxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx,
Chief Executive Officer
Dear Xx. Xxxxx:
This will confirm the arrangements, terms and conditions
pursuant to which Whale Securities Co., L.P. (the "Consultant"), has been
retained to serve as a financial consultant and advisor to Xxxx Xxxxxx Golf,
Inc., a Delaware corporation (the "Company"), on a non-exclusive basis for a
period of two (2) years commencing on ________________, 1998. The undersigned
hereby agrees to the following terms and conditions:
1. Duties of Consultant. Consultant shall, at the request of
the Company, upon reasonable notice, render the following services to the
Company from time to time:
(a) Consulting Services. Consultant will provide such
financial consulting services and advice pertaining to the Company's business
affairs as the Company may from time to time reasonably request. Without
limiting the generality of the foregoing, Consultant will assist the Company in
developing, studying and evaluating financing and merger and acquisition
proposals based upon documentary information provided to the Consultant by the
Company.
(b) Financing. Consultant will assist and represent
the Company in obtaining both short and long-term financing. The Consultant will
be entitled to additional compensation under certain circumstances in accordance
with the terms set forth in Section 3 hereof.
(c) Wall Street Liaison. Consultant will, when
appropriate, arrange meetings between representatives of the Company and
individuals and financial institutions in the investment community, such as
security analysts, portfolio managers and market makers.
The services described in this Section 1 shall be rendered by
Consultant without any direct supervision by the Company and at such time and
place and in such manner (whether by conference, telephone, letter or otherwise)
as Consultant may determine.
2. Compensation. As compensation for Consultant's services
hereunder, the Company shall pay to Consultant an annual fee of Thirty Thousand
Dollars ($30,000), the entire Sixty Thousand Dollars ($60,000) payable in full,
in advance, on __________________, 1998.
3. Additional Compensation in Certain Circumstances. In
addition to the financial consulting services described in Section 1 above,
Consultant may bring the Company in contact with persons, whether individuals or
entities, that may be suitable candidates for providing the Company with, or may
lead the Company to other individuals or entities that may provide the Company
with, debt or equity financing or that may be suitable candidates, or may lead
the Company to such suitable candidates, to purchase substantially all of the
stock or assets of the Company, to have substantially all of its stock or assets
purchased by the Company, merge with the Company, or enter into a joint venture
or other transaction with the Company. If, at any time up until the [second]
anniversary of the date hereof, the Company enters into an agreement with any
such persons or their affiliates, or with any persons introduced to the Company
by any such persons or their affiliates, pursuant to which the Company obtains
debt or equity financing or pursuant to which substantially all of the Company's
stock or assets is purchased, the Company purchases substantially all of the
stock or assets of another entity or the Company is merged with or into another
entity, or pursuant to which the Company enters into a joint venture or other on
or off balance sheet corporate finance transaction (each a "Transaction"), the
Company will pay to Consultant, in accordance with the formula set forth below,
additional compensation based on the aggregate value of the consideration,
whether in cash, securities, assumption of (or purchase subject to) debt or
liabilities (including, without limitation, indebtedness for borrowed money,
pension liabilities and guarantees), or other property, obligations or services,
paid or payable directly or indirectly (in escrow or otherwise) or otherwise
assumed in connection with such Transaction (the "Consideration"). For purposes
of this Section 3, the "Company" shall include its subsidiaries and any other
entity in which it owns (directly or indirectly) a majority interest.
The additional compensation to be paid will be paid upon the
closing of the Transaction (except that, if any part of the Consideration is in
the form of contingent payments to be calculated to reference to uncertain
future occurrences, such as future financial or business performance, than the
portion of the
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fees of Consultant relating to such part of the Consideration shall be payable
at the earlier of (i) the receipt or payment of such Consideration; or (ii) the
time that the amount of such Consideration can be determined, by certified
check, in the following amounts:
5% of the first $5,000,000 of the Consideration;
4% of the Consideration in excess of $5,000,000 and
up to $6,000,000;
3% of the Consideration in excess of $6,000,000 and
up to $7,000,000;
2% of the Consideration in excess of $7,000,000 and
up to $8,000,000; and
1% of any Consideration in excess of $8,000,000.
4. Available Time. Consultant shall make available such time
as it, in its sole discretion, shall deem appropriate for the performance of its
obligations under this agreement and may in certain circumstances be entitled to
additional compensation in connection therewith.
5. Relationship. Nothing herein shall constitute Consultant as
an employee or agent of the Company, except to such extent as might hereinafter
be agreed upon for a particular purpose. Except as might hereinafter be
expressly agreed, Consultant shall not have the authority to obligate or commit
the Company in any manner whatsoever.
6. Confidentiality. Except in the course of the performance of
its duties hereunder, Consultant agrees that it shall not disclose any trade
secrets, know-how, or other proprietary information not in the public domain
learned as a result of this Agreement unless and until such information becomes
generally known.
7. Assignment and Termination. This Agreement shall not be
assignable by any party except to successors to all or substantially all of the
business of either party for any reason whatsoever without the prior written
consent of the other party, which consent may be arbitrarily withheld by the
party whose consent is required.
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8. Governing Law. This Agreement shall be deemed to be a
contract made under the laws of the State of New York and for all purposes shall
be construed in accordance with the laws of said State.
Very truly yours,
WHALE SECURITIES CO., L.P.
By: Whale Securities Corp.,
General Partner
By:_______________________________
Name:
Title:
AGREED AND ACCEPTED:
XXXX XXXXXX GOLF, INC.
By:______________________________
Name:
Title:
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