SERVICES AGREEMENT
EXHIBIT
10.1
THIS
SERVICES AGREEMENT, effective as of July 1, 2007, is entered into by and between
SP Corporate Services, LLC (“SP”), a Delaware limited liability company, having
an office 000 Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, and CoSine
Communications, Inc. (the “Company”) having an office at 00 Xxxx Xxxx Xxxxxx,
Xxxxx X, Xxx Xxxxx, XX 00000.
W
I T N E
S S E T H:
WHEREAS,
the Company desires to have SP furnish certain services to the Company, as
set
forth on Exhibit A attached hereto as it may be amended from time to time
pursuant to the terms hereof (the “Services”), and SP has agreed to furnish
Services, pursuant to the terms and conditions hereinafter set forth;
and
WHEREAS,
this Agreement has been approved by a majority of the disinterested directors
of
the Company.
NOW,
THEREFORE, the parties hereto, intending to be legally bound, hereby agree
as
follows:
Section
1. Engagement
of SP.
1.01. During
the term of this Agreement, SP shall provide to the Company such Services,
as
more fully described and defined on Exhibit A, as may be necessary or desirable
or as may be reasonably requested or required, in connection with the business,
operations and affairs, both ordinary and extraordinary, of the Company and
its
subsidiaries and affiliates.
In
performing Services, SP shall be subject to the supervision and control of
the
disinterested directors of the Company. In no event shall SP incur an obligation
or enter into any transaction on behalf of the Company involving in excess
of
$50,000 without the prior approval of the disinterested directors of the
Company.
1.02. While
the
amount of time and personnel required for performance by SP hereunder will
necessarily vary depending upon the nature and type of Services, SP shall devote
such time and effort and make available such personnel as may from time to
time
reasonably be required for the performance of Services hereunder.
Notwithstanding the foregoing, SP shall make Xxxxx X. Xxxxxx available to act
as, and he shall devote such time and effort as is necessary to fulfill the
statutory and fiduciary duties of, the Chief Executive Officer, President,
Chief
Financial Officer and Secretary of the Company until such time as otherwise
instructed or removed by the board of directors of the Company or the
resignation of Xxxxx X. Xxxxxx in any of the capacities.
1.03. Exhibit
A
may be amended from time to time to provide for additional Services, the
elimination of certain Services, increases or decreases to the compensation
paid
hereunder, or other changes, upon the mutual agreement of the parties
hereto.
Section
2. Term.
This
Agreement shall commence effective as of July 1, 2007, and shall continue
through June 30, 2008, and shall automatically renew for successive one (1)
year
periods unless and until terminated by either party, on any anniversary date,
upon not less than thirty (30) days prior written notice to the other.
Notwithstanding the foregoing, this Agreement shall terminate upon 30 days
prior
written notice from the Company received by SP within 60 days following the
death of Xxxxx X. Xxxxxx or his resignation as Chief Executive Officer, Chief
Financial Officer or Secretary of the Company.
Section
3. Payments
to SP.
3.01. In
consideration of Services furnished by SP hereunder, the Company shall pay
to SP
a fixed monthly fee as set forth in Section 3.02, which shall be adjustable
annually upon mutual agreement by the parties or at other times upon the
amendment of Exhibit A pursuant to Section 1.03. In addition, the Company shall
reimburse SP for all reasonable and necessary business expenses, including
legal
expenses, incurred on behalf of the Company.
3.02. The
Company shall pay SP a fixed monthly fee in the amount set forth on Exhibit
A in
advance on the first day of each month.
Section
4. Limitation
on Liability.
To
the
fullest extent permitted by law and as consistent with the Company's Bylaws
and
Fourth Amended and Restated Certificate of Incorporation (the "Company's Charter
Documents"), SP shall not be liable to the Company, any affiliate thereof or
any
third party for any losses, claims, damages, liabilities, penalties, obligations
or expenses, including reasonable legal fees and expenses, of any kind or nature
whatsoever due to any act or omission in connection with the rendering of
Services hereunder, unless that act or omission constitutes gross negligence,
willful misconduct or fraud. Further, SP shall reasonably rely on information
provided to it about the Company, if any, that is provided by the Company or
the
Company’s affiliates, employees or agents. In no event shall SP be liable for
any error or inaccuracy of any report, computation or other information or
document produced in accordance with this Agreement, for whose accuracy the
Company assumes all responsibility, unless resulting from the gross negligence,
willful misconduct or fraud of SP or SP’s officers, directors, employees or
agents.
Section
5. Indemnity.
To
the
fullest extent permitted by law and as consistent with the Company's Charter
Documents, the Company shall defend, indemnify, save and hold harmless SP from
and against any claims, liabilities, damages, losses, costs or expenses,
including amounts paid in satisfaction of judgments, in compromises and
settlements, as fines and penalties and legal or other costs and reasonable
expenses of investigating or defending against any claim or alleged claim of
any
nature whatsoever resulting from SP’s actions under the terms of this Agreement,
except to the extent occasioned by the gross negligence, willful misconduct
or
fraud of SP or SP’s officers, directors, employees or agents. To the fullest
extent permitted by law and as consistent with the Company's Charter Documents,
the Company’s obligation to indemnify SP hereunder shall extend to and inure to
the benefit of SP’s officers, directors, members, employees, affiliates and
consultants. If SP should reasonably determine, its interests are or may be
adverse to the interests of the Company, SP may retain its own counsel in
connection with such claim or alleged claim or action, in which case the Company
shall be liable, to extent permitted under this Section 5, to SP for any
reasonable and documented legal, accounting or other directly related fees
and
expenses incurred by SP in connection with its investigating or defending such
claim or alleged claim or action.
Section
6. Confidential
Information.
SP
shall
not at any time during or following the termination or expiration for any reason
of this Agreement, directly or indirectly, disclose, publish or divulge to
any
person (except where necessary in connection with the furnishing of Services
under this Agreement), appropriate or use, or cause or permit any other person
to appropriate or use, any of the Company’s inventions, discoveries,
improvements, trade secrets, copyrights or other proprietary, secret or
confidential information not then publicly available.
Section
7. Non-Exclusive
Arrangement; Conflicts of Interest.
The
Company acknowledges that SP may from time to time enter into agreements similar
to this Agreement with other companies pursuant to which SP may agree to provide
services similar in nature to the Services being provided hereunder. The Company
understands that the person or persons providing the Services hereunder may
also
provide similar or additional services to other companies, including as officers
and directors of such companies. In addition, to the extent business
opportunities arise, the Company acknowledges that SP will be under no
obligation to present such opportunity to the Company, and SP may, in its sole
discretion, present any such opportunity to whatever company it so chooses,
or
to none at all; provided, however, nothing contained herein shall affect or
otherwise limit the fiduciary obligations of the officers or directors of the
Company.
Section
8. General.
8.01. This
Agreement constitutes the entire agreement between the parties hereto pertaining
to the subject matter hereof and supersedes all prior representations and
agreements, whether oral or written, and cannot be modified, changed, waived
or
terminated except by a writing signed by both of the parties hereto. No course
of conduct or trade custom or usage shall in any way be used to explain, modify,
amend or otherwise construe this Agreement.
8.02. All
notices, requests, demands and other communications required or permitted under
this Agreement shall be in writing and shall be deemed to have been duly given
if personally delivered, sent by nationally recognized overnight carrier, one
day after being sent, or mailed by first class registered or certified mail,
return receipt requested, five days after being sent.
8.03. This
Agreement shall be construed under the laws of the State of New York and the
parties hereby submit to the personal jurisdiction of any federal or state
court
located therein, and agree that jurisdiction shall rest exclusively therein,
without giving effect to the principles of conflict of laws.
8.04. This
Agreement may not be assigned by any party without the prior written consent
of
the other parties to this Agreement.
8.05. This
Agreement may be executed in two or more counterparts, each of which shall
be
deemed to be an original but all of which together shall constitute one and
the
same instrument.
8.06. Sections
4, 5 and 6 shall survive any expiration or termination of this
Agreement.
IN
WITNESS WHEREOF, the parties have duly executed this Agreement as of June 15,
2007 .
SP
CORPORATE SERVICES LLC
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By:
|
/s/
Xxxxx X. Xxxxxx
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Name:
Xxxxx
X. Xxxxxx
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Title: Managing
Director
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COSINE
COMMUNICATIONS, INC.
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By:
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/s/
Xxxxx X. Xxxxxx
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Name:
Xxxxx
X. Xxxxxx
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Title: President
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EXHIBIT
A
The
“Services” shall include the following:
1. Provide
the non-exclusive services of Xxxxx X. Xxxxxx to serve as the Company’s Chief
Executive Officer, President, Chief Financial Officer and Secretary (the
"Company's Officers"). Such person, in his capacity as the Company's Officers,
will perform all duties normally associated with that of each of the Company's
Officers, including without limitation:
• Responsibility
for any and all financing matters for the Company and its subsidiaries including
but not limited to debt, equity or other financings, whether through the public
markets or in private transactions, or otherwise, including the negotiation
and
consummation of all of the foregoing.
• Review
of
annual and quarterly budgets and related matters.
• Supervise
and administer, as appropriate, all accounting/financial duties and related
functions on behalf of the Company for its operations and business matters
(including control of the Company’s cash, checking accounts, revenue receipts,
disbursements, bookkeeping, accounts, ledgers, xxxxxxxx, payroll and related
matters).
• Provide
or engage the non-exclusive services of a person or persons to conduct the
periodic review of the Company’s Net Operating Losses (“NOL”), including the
impact of changes in Company shareholders on the availability of any NOL’s
(“Provided NOL Services”). The Provided NOL Services will not include so-called
“382 studies” or updates to 382 studies due to changes in shareholders or other
Company activities (“Extra NOL Services”). If SP or Xxxxx X. Xxxxxx procures or
provides Extra NOL Services to the Company, upon prior Company approval, the
Company will be billed separately and additionally by SP therefore.
• Review
and supervise the Company’s presently existing reporting obligations under
United States Securities and Exchange Commission regulations for a public
corporation, including Quarterly Reports on Form 10-Q and Annual Reports on
Form
10-K, as well as under related state laws.
• Act
as
and perform the duties of the Company's Principle Executive Officer and
Principle Accounting Officer.
• Organization
and preparation for board meetings, corporate record keeping, management of
due
diligence for corporate transactions, review and maintenance of D&O
insurance policies, and other similar items.
• Maintain
the Company’s corporate office and legal address.
• All
other
duties of the Company's Officers as set forth in the Company's Bylaws, as
amended.
2. Provide
the non-exclusive services of such other personnel as necessary for the
performance of SP’s obligations under this Agreement.
The
monthly fee for providing the Services shall be $17,000.