BIBICOFF &
ASSOCIATES, INC.
October 20, 1998
Xx. Xxxxxxx Xxxxxx
Chief Executive Officer
Telenetics Corporation
00000 Xxxxx Xxxxxxx Xxxxx
Xxxx Xxxxxx, XX 00000
Dear Xxxxxxx:
This will confirm our understanding and agreement regarding the
relationship between Xxxxxxxx & Associates, Inc. ("Bibicoff") and Telenetics
Corporation ("Telenetics"):
1. Xxxxxxxx will be the exclusive representative of Telenetics in
the areas of stockholder and financial community relations and
will serve as a consultant to the Board of Directors in its
relations with the investment community.
2. The term of our Agreement will be for twelve months beginning
on October 15, 1998. The Agreement may be terminated by
Telenetics for the following reasons only: (a) Xxxxxx Xxxxxxxx
leaves Bibicoff or sells a controlling interest to another
entity or person, or (b) Xxxxxx Xxxxxxxx becomes disabled.
Disabled in this case means unable to perform his usual duties
for eight consecutive weeks or nine weeks out of twelve weeks.
3. Xxxxxxxx will be paid a fee of $10,500 per month plus actual
out-of-pocket expenses. Thirty percent of the fee will be
paid when billed and seventy percent will be accrued until
such time as the company completes a financing of one
million dollars or more.
4. In addition to the above fee, Xxxxxxxx will be granted
500,000 shares of stock and will be granted options to
purchase 1,500,000 shares of stock at an exercise price of
$.05 per share. It is understood that both the shares
purchased and the shares into which the options are
exercisable ("option shares") are not registered and may not
be sold unless they are registered or unless they are exempt
from registration. Bibicoff will have piggyback registration
rights on both the shares and option shares. The options
will vest and be issued 500,000 upon execution of this
Agreement, 500,000 at the end of six months and 500,000 at
the end of twelve months.
Should Telenetics terminate this Agreement without
cause, all of its financial obligations pursuant to the
Agreement would continue and any unvested options would
immediately vest.
Should Telenetics terminate this Agreement with
cause, then the financial obligations of Telenetics would
cease and any unvested options would be terminated.
Should Bibicoff terminate the Agreement for
reasonable cause, all of the financial obligations of
Telenetics would continue and any unvested options would vest
immediately.
Should Bibicoff terminate the Agreement without
cause, all of the financial obligations of Telenetics would
cease and any unvested options would vest immediately.
5. Should Bibicoff be successful in directly introducing
Telenetics to a source of capital, Bibicoff would receive a
finders fee of 3% of any amount raised if there is another
finder to be compensated or 5% if there is no other finder to
be compensated.
6. It is the intent of the parties to this Agreement that
Bibicoff will have meaningful input into all decisions that
directly effect the stockholders and financial community e.g.
where the shares are to be listed; possible splits; selection
of materials to be used in the financial relations program;
timing of information releases.
7. Bibicoff will continuously receive current information
regarding the status of the company. The information will be
materially complete and correct and will not contain any
untrue statements of material fact or omit to state a material
fact needed to make the statements not misleading. In the
material which is currently public information provided by
Telenetics, there are no untrue statements of material fact
nor are there omissions of material fact needed to make the
information not misleading.
8. Xxxxxxxx will represent no more than three public companies
without the prior written consent of Telenetics.
If the above is acceptable to you, please so indicate by signing in the
space provided below.
Very truly yours,
/s/ XXXXXX XXXXXXXX
Xxxxxx Xxxxxxxx
Chief Executive Officer
AGREED TO AND ACCEPTED
/S/ XXXXXXX XXXXXX
--------------------------
Telenetics Corporation, by
Xxxxxxx Xxxxxx, CEO
