EXHIBIT 10.1
Ameristar 000 Xxxxxxx Xxxxxx
International Suite 2904
Capital, Inc. Xxx Xxxx, XX 00000
000-000-0000
000-000-0000 fax
February 11, 2004
Wilf Shorrocks
Chief Executive
Peak Entertainment Holdings, Inc.
Xxxxxxx Xxxx, Xxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxxx XX00 0XX XX
Re: Service Agreement
Dear Wilf,
This letter agreement (the "Agreement") will outline the terms and conditions
under which Ameristar International Capital Inc., a Florida corporation (the
"Consultant"), will act as a corporate financial advisor to Peak Entertainment
Holdings, Inc. ("Peak"), a publicly owned and traded Nevada corporation (the
"Company").
Accordingly, and in consideration for the mutual benefit derived here from and
other good and valuable consideration, the receipt and adequacy of which is
hereby acknowledged, we agree as follows:
1. Engagement. The Company hereby engages and retains the Consultant as a
financial advisor for and on the Company's behalf to perform the Services (as
that term is hereinafter defined) and the Consultant hereby accepts such
appointment on the terms and subject to the conditions hereinafter set forth.
The Company's engagement of the Consultant shall commence with the execution of
this Agreement.
2. Services. During the twelve month term of this Agreement (the "Term"), the
Consultant shall aid and assist the Company in connection with a multi faceted
corporate finance project comprised of enhancing the Company's shareholder value
through: (i) assisting the Company in identifying sources of capital for equity
and debt financings; (ii) introducing the company to selected retail brokerages;
(iii) introducing the company to consultants who bring specific and tangible
services to aid in the twelve month program; (iv) preparing the company to
participate in several road-show presentations, domestically and
internationally; (v) assisting the company with all of its press releases to the
public as well as identifying new distribution avenues for information to the
public; (vi) assisting the company in the development of a power-point
presentation to present to potential investors; (vii) introducing the company to
senior money managers, institutional investors, accredited investors and others;
(viii) when qualified, introducing the Company to two suitable AMEX specialists
and setting direct meetings with senior AMEX management directly in charge of
new listings; (ix) assisting in identifying potential merger and acquisition
candidates; (x) aiding and assisting the Company in preparing for and causing
the preparation and filing of an Initial Listing Application with the AMEX or
NASDAQ SMALL-CAP EXCHANGE;. The foregoing is hereinafter collectively referred
to as the "Services". The Services shall specifically exclude the furnishing of
legal, accounting, investment or tax advice or services.
3. Compensation. In consideration for the Services, the Company hereby agrees to
pay to the Consultant and/or to Ameristar and the Consultant and Ameristar
hereby accept as their respective sole compensation for the Services the
following:
A. Initial Retainer. $25,000, of which $10,000 shall be due and payable
to the Consultant in full upon the execution of this Agreement.
$15,000 will be accrued until the Company has received a new cash
investment.
B. Initial equity fee. 100,000 shares of the Company's common stock
C. Monthly Retainer. A retainer in the amount of $12,500 will be due
and payable monthly during the term of the Agreement. The retainers
will accrue and be payable promptly after the Company has received
new cash investment, and any accrued retainers will be released in
an amount not to exceed 7.5% of the new capital raised. Additionally
any accruals payable within 90 days of this agreement will be offset
against
February 11, 2004
Wilf Shorrocks
Page 2.
capital raising fees earned within the first six months of this
agreement by consultant from investors identified on List A and B
annexed hereto.
D. Capital Raising - other than from lists A and B annexed
|X| Equity based investments - 7.5% paid, in cash, at closing of equity
received
List A - 3%
List B - 5%
|X| Debt based investments - Three percent paid, in cash, at closing of
debt received
List A - 1%
List B - 1.5%
This does not include account receivables financing unless lender directly
introduced and not major bank.
4. Success Fee. In consideration for the successful services of Consultant, the
following success fees will be deemed earned and will be due and payable:
Common Stock Share Price Appreciation
|X| Common stock bid price reaches $1.75 per share and bid price closes
at $1.50 or higher for ten consecutive days - 100,000 shares of
common stock
Capital Raising
|X| Upon completion of initial of $500,000 raise up, except from lists A
and B, Consultant will be issued 50,000 warrants at 110% of the
placement
|X| After the next $1.0 - 2.0 million, except from lists A and B,
Consultant will be issued 100,000 warrants at 110% of the placement
|X| After the next $5.0 million in equity raised, except from lists A
and B, Consultant will be issued 250,000 warrants at 110% of
placement
Exchange Listing
|X| Company achieves a listing to the American Stock Exchange - $25,000
payment will be due and payable to Consultant
The above success fees will be paid as a direct production of
consultant.
Share Issuance - All shares eligible to be earned by Consultant under the
terms of this Agreement (200,000 shares of common stock) will be issued upon the
commencement of the Agreement and held in escrow until earned, at which time
they will be released to Consultant. Shares covered under the Initial Equity Fee
are to be released immediately.
Registration Rights - All shares issued to Consultant shall be entitled to
and receive Piggyback Registration rights.
February 11, 2004
Wilf Shorrocks
Page 3.
Expense Reimbursement - It is expressly agreed and understood that the
Consultant's compensation as provided herein does not include the normal
out-of-pocket expenses, including but not limited to long distance
communication, business class airfare, hotel lodging and meals, transportation,
express mail, etc., incurred by the Consultant in performing the Services and
carrying out the Consultant's duties under this Agreement. The Consultant agrees
to seek pre-approval from the Company for any expenses in excess of $100.00. All
invoiced expenses will be due upon submitted receipt.
5. Representations and Warranties. In order to implement the operation of this
Agreement, the Consultant and the Company hereby represent to each other as
follows:
A. The execution, delivery and performance of this Agreement, in the time
and manner herein specified, will not conflict with, result in a breach of, or
constitute a default under any existing agreement, or other instrument to which
either the Consultant or the Company is a party or by which either the
Consultant or the Company may be bound or affected;
B. The Consultant and the Company each have full legal authority to enter
into this Agreement and to perform the same in the time and manner contemplated;
C. The Company has taken all corporate action necessary to ratify and
approve this Agreement.
6. Confidential Data.
A. Neither the Consultant nor the Company shall divulge to others, any
secret or confidential information, knowledge, or data concerning or pertaining
to the business and affairs of each other (which is identified as being secret
or confidential) obtained by either the Consultant or the Company as a result of
the Consultant's engagement hereunder, unless authorized, in writing.
B. Similarly, neither the Consultant nor the Company shall be required in
the performance of their respective duties to divulge to any other party or any
officer, director, stockholder or employee thereof, any secret or confidential
information, knowledge, or data concerning any other person, firm or entity
(including, but not limited to, any such persons, firm or entity which may be a
competitor or potential competitor of either of us) which the Consultant or the
Company may have or be able to obtain otherwise than as a result of the
relationships established by this Agreement.
7. Independent Contractors. The Consultant and the Company shall be deemed to be
independent contractors in the performance of their duties hereunder. Neither
shall, by reason of this Agreement or the performance of their respective duties
hereunder, be or be deemed to be, an employee, partner, co-venturer or
controlling person of the other and, except as specifically authorized by this
Agreement, neither shall have the power to enter into any agreement on behalf of
or otherwise bind the other. Except with respect to confidential and proprietary
information as hereinabove enumerated, neither shall have, or be deemed to have,
any fiduciary obligation or duties to any other.
8. Governing Law, Forum, Attorneys Fees. The validity of this Agreement and the
interpretation and performance of all of its terms shall be governed by the
substantive laws of the State of New York. The parties hereto agree that any
suit, action or proceeding arising out of or relating to this Agreement, shall
be submitted to the New York State Supreme Court, New York County for
determination pursuant to the New York Simplified Procedure for Court
Determination of Disputes and each party waives any objection to the laying of
the venue of such suit and irrevocably submits to the jurisdiction of such
Court.
9. Term and Termination. The term of the Agreement shall commence on the
execution hereof and shall continue for twelve months. The Company shall have
the right, anytime after the 90th day of this Agreement, on 10 days prior
written notice to the Consultant, to terminate this Agreement for any reason. No
termination of this Agreement shall adversely affect the Consultant's rights to
receive or retain the compensation previously earned or paid.
February 11, 2004
Wilf Shorrocks
Page 4.
10. Miscellaneous. All notices that are required to be or may be sent pursuant
to the provision of this Agreement shall be sent by certified mail, return
receipt requested, or by overnight package delivery service, to the Consultant
and/or the Company at the address appearing herein, and shall count from the
date of mailing or the date after the date of the air xxxx. This Agreement is
binding upon and shall inure to the benefit of and shall be enforceable against
the Consultant and the Company, and their successors and assigns.
This Agreement shall not be amended or assigned without the prior written
consent of the Consultant and the Company. This Agreement is intended to and
does contain and embody herein all of the parties' understandings and
agreements, both written or oral, with respect to the subject matter of this
Agreement. There are no representations, warranties or covenants other than
those set forth herein.
If the foregoing correctly sets forth the understanding and agreement of the
Consultant and the Company, please indicate your acceptance by signing the
enclosed copy of this Agreement in the indicated space and returning the same to
the undersigned at your earliest convenience.
Very truly yours,
AMERISTAR INTERNATIONAL CAPITAL, INC.
By: /s/ Xxxxxx X. Xxxxxxx AGREED TO AND ACCEPTED:
-------------------------------- Peak Entertainment Holdings, Inc.
Xxxxxx X. Xxxxxxx
Partner By: /s/ Wilf Shorrocks
-------------------------------------
Wilf Shorrocks, Chief Executive
JJM:gl
