Letter of Engagement Biometrx, Inc. March 17, 2006
Biometrx,
Inc.
March
17, 2006
The
following sets forth the agreement (this “Agreement”)
for
the engagement of Pasadena Capital Partners, LLC (“Pasadena”)
by
Biometrx,
Inc.
(the
“Company”):
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1.
Term
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Three months,
commencing as of the date set forth above, unless earlier terminated
pursuant to the terms of this Agreement (the “Initial
Term”),
and terminable thereafter by either party upon 30 days’ prior written
notice.
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2.
Objective
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The
development and implementation of a proactive marketing program designed
to (a) increase the awareness of the Company and (b) generate a
significant increase in liquidity and market capitalization. In addition,
upon request, Pasadena may agree to advise the Company in business
development and strategic advisory services. Any such services, however,
shall be the subject of a separate agreement.
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3.
The Program
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3.1
Pasadena will structure and implement a marketing program designed
to
create extensive financial market and investor awareness for the
Company
to drive long-term shareholder support. The core drivers of the program
will be to create institutional and retail buying in the Company’s stock
through a proactive sales and marketing program emphasizing
technology-driven communications, direct communication with stock
brokers
and leveraging the Company’s image to attract additional long term
investors and to create additional opportunities in M&A and Business
Development. Given the reality of various markets factors, Pasadena
can
give no assurance that the marketing program will result in an increase
in
the Company’s stock price, liquidity or market
capitalization.
3.2
Pasadena understands that, during any period in which the Company
is in
“registration” for a public offering of securities under the Securities
Act of 1933 and during the distribution of such securities, the Company’s
investor relations and marketing efforts will be severely limited.
However, it will be the responsibility of the Company (with the advice
of
its securities counsel) to determine, and to inform Pasadena regarding,
what investor relations and marketing efforts are permissible and
non-permissible during such periods. Pasadena will follow the direction
of
the Company and its securities
counsel.
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4.
Responsibilities
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4.1
In addition to marketing and financial public relations, Pasadena
will
assume the responsibilities of an in-house Investor Relations Officer
for
the Company on a full turnkey basis, including the generation of
corporate
and shareholder communications, retail and institutional investor
contact
and media. Pasadena will work in conjunction with the Company’s
management, securities counsel, investment bankers and auditors and
under
supervision of management. The content may include the
following:
· Campaign
Development and Execution
· Consultation
on Press Announcements
· Database
Development and Management
· Image
Analysis: recommendations and implementation
· Messaging:
institutional and retail
· Online
presentations: drafting and production responsibilities
· Email
messaging: targets: Retail and Institutional/Other databases
· Direct
Mail: shareholder, media, the Company’s relationship universe
· Public
Relations
· Capital
Conferences
4.2
Pasadena will not publish or publicly release any press release or
other
document (each, an “IR
Document”)
regarding the Company that has not been approved by the Company. The
Company assumes responsibility for the accuracy and completeness
of all IR
Documents and the compliance of such IR Documents with applicable
laws,
rules and regulations. The Company agrees that Pasadena has no
obligation or duty to verify the accuracy or completeness of the
IR
Documents.
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5.
Fees
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Pasadena
will be paid $6,000 per month for so long as it is
retained to provide investor relations services.
The first payment of $6,000 will be due prior to Pasadena beginning
the
implementation its IR program on behalf of BMRX. Wiring information
is set
forth below. Any
fees incurred by Pasadena will be reimbursed by the Company at cost.
Pasadena agrees to make the Company aware of any costs greater than
$500
in
writing prior to incurring them.
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6.
Equity Compensation
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6.1
Solely in consideration for Pasadena’s execution of this Agreement and
regardless of when or under what circumstances this Agreement is
terminated, upon execution of this Agreement, the Company will issue,
and
deliver to Pasadena (or such other entity designated by Pasadena)
20,000
shares of Rule 144 restricted common stock within 5 business days
of the
execution of this Agreement (the “Initial
Shares”).
BMRX will have the right to extend this contract through March 16,
2007
for an additional 60,000 Rule 144 restricted shares, so long as the
10-day
moving average bid of the Company’s stock remains above $6.00 prior to the
extension of this contract.
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As
used
herein, references to the Initial Shares shall also mean all shares of the
Company’s common stock that are issued or issuable to Pasadena (or such other
entity designated by Pasadena) on account of any stock split, dividend or
other
distribution to the Company’s stockholders. Following the required holding
period for the shares, upon the request of Pasadena, BMRX agrees to provide,
at
its own expense, a valid written legal opinion relative to the sale or proposed
sale of said Shares within ten calendar days of the date of request of Pasadena.
BMRX further agrees to cooperate with Pasadena in having the Rule 144 legend
removed from the certificate(s) representing the shares. BMRX acknowledges
that
the Shares are issued to Pasadena as compensation for services rendered.
BMRX
shall not obstruct Pasadena’s sale of the shares in any way.
6.2
The
Company will issue and deliver the Shares in the name of the entity and to
the
entity’s address listed at the bottom of this document. At any time during the
term of this Agreement, the Company shall deliver, at Pasadena’s request, a
Letter of Tradability from the Company’s legal counsel and an irrevocable
guarantee from the Company’s CEO.
6.3
In
order to allow Pasadena (or such other entity designated by Pasadena) to
avail
itself of Rule 144 in order to sell the Shares, the Company shall, at all
times
during the term of this Agreement and for a period of one year after the
termination of this Agreement, ensure that there is adequate current public
information available regarding the Company as required by Rule
144(c).
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6.4
The
Company agrees to include the Shares in any Registration Statement filed
with
the Securities and Exchange Commission during the term of this Agreement
or
during the one year period immediately following the termination of this
Agreement, as follows:
(A)
Piggyback
Rights.
(i) If
the Company proposes to register any of its warrants, outstanding common
stock
or any other shares of common stock of the Company under the Securities Act
(other than a registration (A) on Form S-8 or S-4 or any successor or similar
forms, (B) relating to Common Stock or any other shares of common stock of
the
Company issuable upon exercise of employee share options or in connection
with
any employee benefit or similar plan of the Company or (C) in connection
with a
direct or indirect acquisition by the Company of another entity or any
transaction with respect to which Rule 145 (or any successor provision) under
the Securities Act applies), whether or not for sale for its own account,
it
will each such time, give prompt written notice to Pasadena at least 20 days
prior to the anticipated filing date of the registration statement relating
to
such registration, which notice shall set forth such Pasadena’s rights under
this Section 6.4(A) and shall offer Pasadena (and any transferee, designee
or
assignee of Pasadena, collectively referred to for purposes of this section
as
“Pasadena”), the opportunity to include in such registration statement such
number of the Shares as Pasadena may request (unless the Shares may be sold
pursuant to Rule 144(k)). Upon the written request of Pasadena made within
10
days after the receipt of notice from the Company (which request shall specify
the number of the Shares intended to be disposed of by Pasadena), the Company
will use its best efforts to effect the registration under the Securities
Act of
all of the Shares that the Company has been so requested to register by
Pasadena, to the extent requisite to permit the disposition of the Shares
so to
be registered; provided, however, that (A) if such registration involves
an
underwritten public offering, Pasadena must sell its Shares to any underwriters
selected by the Company with the consent of Pasadena on the same terms and
conditions as apply to the Company and (B) if, at any time after giving written
notice of its intention to register securities, pursuant to this Section
6 and
prior to the effective date of the registration statement filed in connection
with such registration, the Company shall determine for any reason not to
register the securities covered by the registration statement, the Company
shall
give written notice to Pasadena and, thereupon, shall be relieved of its
obligation to register the Shares in connection with such
registration.
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(ii) If
a
registration pursuant to this Section 6.4(A) involves an underwritten public
offering and the managing underwriter thereof advises the Company that, in
its
view, the number of shares of common stock that the Company and Pasadena
intend
to include in such registration exceeds the largest number of shares of Common
Stock that can be sold without having an adverse effect on such public offering
(the “Maximum
Offering Size”),
the
Company will include in such registration only such number of shares of common
stock as does not exceed the Maximum Offering Size, and the number of shares
in
the Maximum Offering Size shall be allocated among the Company, Pasadena
and any
other sellers of common stock in such public offering (“Third-Party
Sellers”),
first, to the Company until all the shares of common stock originally proposed
to be offered for sale by the Company have been allocated, second, if the
filing
of the registration statement was made upon the demand of any Third Party
Seller, then pro rata among such Third Party Sellers, and third, pro rata
among
Pasadena and any other Third-Party Sellers, in each case on the basis of
the
relative number of shares of common stock originally proposed to be offered
for
sale under such registration by each of Pasadena and the Third-Party Sellers,
as
the case may be. If as a result of the proration provisions of this Section
6.4(A)(ii), Pasadena is not entitled to include all of the Shares in such
registration, Pasadena may elect to withdraw its request to include its Shares
in such registration. With respect to registrations pursuant to this Section
6.4(A), the number of securities required to satisfy any underwriters’
over-allotment option shall be allocated among the Company, Pasadena and
any
Third Party Seller pro rata on the basis of the relative number of securities
offered for sale under such registration by each of Pasadena, the Company
and
any such Third Party Sellers before the exercise of such over-allotment
option.
(B)
If,
and as often as, there are any changes in the Company’s common stock by way of
stock split, stock dividend, reverse split, combination or reclassification,
or
through merger, consolidation, reorganization or recapitalization, or by
any
other means, appropriate adjustment shall be made in the provisions hereof,
as
may be required, so that the registration rights and privileges granted hereby
shall continue with respect to the Shares as so changed.
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6.5
If,
and as often as, there are any changes in the Company’s common stock by way of
stock split, stock dividend, reverse split, combination or reclassification,
or
through merger, consolidation, reorganization or recapitalization, or by
any
other means, appropriate adjustment shall be to the common stock due to or
owned
by Pasadena, as may be required, so that the rights and privileges of Pasadena
granted hereby and to maintain its equity interest in the Company shall
continue.
6.6
The
Company acknowledges and agrees that all Shares issued to Pasadena (or such
other entity designated by Pasadena) pursuant to this Agreement are earned
by
Pasadena immediately upon, and are being issued solely in consideration for,
Pasadena’s execution of this Agreement.
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7.
Marketing Budget
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To
support the financial marketing program, the Company acknowledges
that it
will incur certain third party marketing costs. Pasadena will deliver
to
the Company a detailed three month budget setting forth the approximate
costs associated with the campaign. Pasadena will not incur these
costs
without the approval of the Company. At Pasadena’s request, the Company
will pay these costs directly to the third party.
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8.
Indemnification
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The
Company agrees to provide the indemnification set forth in “Exhibit A”
attached hereto.
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9.
Obligations
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The
obligations of Pasadena are solely limited liability company obligations,
and no officer, manager, employee, agent, member or controlling person
of
Pasadena shall be subject to any personal liability whatsoever to
any
person, nor will any such claim be asserted by or on behalf of any
other
party to this Agreement.
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10.
Additional Services
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If
Pasadena is called upon to render services, directly or indirectly
relating to the subject matter of this Agreement, beyond the services
contemplated above (including, but not limited to, production of
documents, answering interrogatories, giving depositions, giving
expert or
other testimony, whether by agreement, subpoena or otherwise), the
Company
shall pay to Pasadena reasonable hourly rates for the persons involved
for
the time expended in rendering such services, including, but not
limited
to, time for meetings, conferences, preparation and travel, and all
related costs and expenses and the reasonable legal fees and expenses
of
Pasadena’s counsel.
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11.
Survival of Certain Provisions
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Sections
6.5, 6.6, 8, 9, 10, 12, 13, 14 and 15 and “Exhibit A” shall survive any
termination of this Agreement and Pasadena’s engagement pursuant to this
Agreement. In addition, such termination shall not terminate Pasadena’s
right to compensation accrued through the date of termination and
for
reimbursement of expenses. Any purported termination of this Agreement
by
the Company prior to the end of the Initial Term, or any termination
by
Pasadena as a result of non-payment or other material breach by the
Company, shall not terminate Pasadena’s right to the
Shares.
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12.
Services/Costs
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Except
as provided in this Agreement, the compensation paid to Pasadena
under
this Agreement will cover all costs for Pasadena personnel. Travel
and
entertainment costs for Pasadena personnel, in addition to certain
third-party costs, will be borne by the Company. Pasadena will provide
reasonable documentation to support reimbursement claims. Pasadena
will
not incur any particular reimbursable cost of $500 or more without
the
written approval from the Company.
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13.
Attorneys’ Fees
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If
any action or proceeding is brought to enforce or interpret any provision
of this Agreement, the prevailing party shall be entitled to recover
as an
element of its costs, and not its damages, reasonable attorneys’ fees to
be fixed by the court.
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14.
Governing Law
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This
Agreement shall be governed by and construed in accordance with the
laws
of the State of Texas, without regard for its conflict of law
principles.
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15.
No Material Nonpublic Information
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During
the last month of the Initial Term and thereafter, the Company shall
not
provide Pasadena with any material nonpublic
information.
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16.
Termination by Pasadena
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At
its sole option, Pasadena may choose to pause or discontinue the
program
or terminate this Agreement if (a) any fax or e-mail “spam” is being
distributed regarding the Company which violates any federal or SEC
regulations - either with or without the Company’s consent, (b) the
Company fails to deliver the Letter of Tradability or the irrevocable
guarantee of the Company’s CEO to Pasadena at Pasadena’s request or
(c) the Company otherwise materially breaches any of the terms or
conditions of this Agreement.
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| Entity to whom the Shares should be issued: | Pasadena Capital Partners, LLC | |
| Address of the foregoing entity: | 0000
Xxxxxxxx Xx. #000
Xxxxx,
XX 00000
|
|
| Wire Instructions: | CREDIT TO THE ACCOUNT OF:
Pasadena
Capital Partners LLC
0000
Xxxxxxxx Xx. Xxxxx #000
Xxxxx,
XX 00000
Ach
R/T # 111000025
ACCOUNT
# 004789075297
BANK
OF AMERICA
0000
X Xxxxx Xx.
Xxxxxxxxxx,
XX 00000
972-323-9611
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Agreed
and Accepted:
| Biometrx, Inc. | Pasadena Capital Partners, LLC | ||
| |
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| By: | /s/ Xxxx X. Xxxxxx | By: | /s/ |
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Xxxx X. Xxxxxx Chief
Executive Officer
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Xxxx Xxxxxxx President
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||
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The
stock
certificate shall be assigned and delivered to the following
entity:
Pasadena
Capital Partners LLC
0000
Xxxxxxxx Xx. Xxxxx #000
Xxxxx,
XX
00000
Tax
ID #
00-0000000
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EXHIBIT
A
Indemnification
Provisions
Biometrx,
Inc. (the
“Company”)
unconditionally, absolutely and irrevocably agrees to and shall defend,
indemnify and hold harmless Pasadena Capital Partners, LLC (“Pasadena”)
and
its past, present and future directors, managers, officers, affiliates, counsel,
shareholders, members, employees, agents, representatives, contractors,
successors and assigns (Pasadena and such persons are collectively referred
to
as the “Indemnified
Persons”)
from
and against any and all losses, claims, costs, expenses (including attorneys’
fees), liabilities and damages (or actions in respect thereof) arising out
of or
related to this Agreement or any actions taken or omitted to be taken by the
Company or an Indemnified Person in connection with this Agreement, including,
but not limited to, (1) any breach by the Company of any of its
representations or warranties in the Agreement or (2) any failure by the Company
to perform its obligations under the Agreement (each, an “Indemnified
Claim”).
Without limiting the generality of the foregoing, such indemnification shall
cover losses, claims, costs, expenses, liabilities and damages imposed on or
incurred by the Indemnified Persons, directly or indirectly, relating to,
resulting from, or arising out of any misstatement of fact or omission of fact,
or any inaccuracy in any information provided or approved by the Company in
connection with the engagement, including information in any SEC filing, press
release, website, marketing material or other document, whether or not the
Indemnified Persons relied thereon or had knowledge thereof. In addition, the
Company agrees to reimburse the Indemnified Persons for legal or other expenses
reasonably incurred by them in respect of each Indemnified Claim at the time
such expenses are incurred. Notwithstanding the foregoing, the Company shall
not
be obligated under the foregoing for any loss, claim, liability or damage that
is finally determined to have resulted primarily from the willful misconduct,
bad faith or gross negligence of the Indemnified Person.
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If
any
proceeding shall be brought or asserted under these provisions against an
Indemnified Person in respect of which indemnity may be sought under these
provisions from the Company, the Indemnified Person shall give prompt written
notice of such proceeding to the Company who shall assume the defense thereof,
including the employment of counsel reasonably satisfactory to the Indemnified
Person (or if more than one, Pasadena), and the payment of all reasonable
expenses; provided that any delay or failure to notify the Company shall relieve
the Company of its obligations hereunder only to the extent, if at all, that
it
is materially prejudiced by reason of such delay or failure. In no event shall
any Indemnified Person be required to make any expenditure or bring any cause
of
action to enforce the Company’s obligations and liability under and pursuant to
the indemnifications set forth in these provisions. The Indemnified Person
shall
have the right to employ separate counsel in any of the foregoing proceedings
and to participate in the defense thereof, but the fees and expenses of such
counsel shall be at the expense of the Indemnified Person unless: (i) the
Company has agreed to pay such fees and expenses; or (ii) the Indemnified Person
shall in good faith determine that there exists actual or potential conflicts
of
interest that make representation by the same counsel inappropriate and the
Company refuses to provide separate counsel. In the event that the Company,
within five days after notice of any such proceeding, fails to assume the
defense thereof, the Indemnified Person shall have the right to undertake the
defense, compromise or settlement of such proceeding, for the account of the
Company, subject to the right of the Company to assume the defense of such
proceeding with counsel reasonably satisfactory to the Indemnified Person at
any
time prior to the settlement, compromise or final determination thereof by
reimbursing the Indemnified Person for all fees and costs incurred to date.
Anything in these provisions to the contrary notwithstanding, the Company shall
not, without the prior written consent of Pasadena (if Pasadena is an
Indemnified Person) or the Indemnified Person (if Pasadena is not an Indemnified
Person), settle or compromise any proceeding or consent to the entry of any
judgment with respect to any proceeding; provided,
however,
that
the Company may, without the Indemnified Person’s prior written consent, settle
or compromise any such proceeding or consent to entry of any judgment with
respect to any such proceeding that requires solely the payment of money damages
by the Indemnified Person and that includes as an unconditional term thereof
the
release by the claimant or the plaintiff of the Indemnified Person from all
liability in respect of such proceeding.
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