COMPENSATION AGREEMENT
Agreement made as of the 18 day of February, 2004 by and between Ohana
Enterprises, Inc. (OHI"), a Delaware corporation with its principal place of
business at 0000 Xxxxx Xxxxxx, Xxxxxxxxxx Xxxxx, XX 00000 and Xxxxx X. Xxxxx,
Esq. ("Xxxxx") with offices at 0000 Xxxxxxx Xxxx Xxxx, Xxxxx 0000, Xxx Xxxxxxx,
Xxxxxxxxxx 00000. This Agreement is intended to constitute an Employee Benefit
Plan as defined in Rule 405 of Regulation C under the Securities Act of 1933, as
amended (the "Act) and Xxxxx is intended to come within the definition of
Employee" as defined in Paragraph A.1(a)(1) of the General Instructions under
Form S-8 under the Act.
1. OHI hereby retains Xxxxx as special counsel to perform certain
services for OHI (services) in order to assist it in complying with its
obligations as a public company. Such services shall include but not be limited
to the following:
(a) Assisting OHI in identifying one or more private companies
which may be acquisition candidates for OHI (Company) in a merger or acquisition
transaction (Transaction).
(b) Performing legal review and due diligence in order to
confirm the nature and status of the Company and reporting his findings to OHI.
(c) Assisting OHI in structuring a proposed transaction
between OHI and the company such that OHI's shareholders will receive maximum
value in the Transaction.
(d) Assisting OHI in negotiating with the person or persons in
control of the Company.
(e) Assisting OHI in locating and introducing OHI to other
professionals with the experience and credibility to provide primary assistance
in completing the Transaction.
(f) Interfacing with OHI counsel and management in order to
enable the Transaction to be concluded in a prompt and efficient manner.
(g) Providing EDGARizing services for OHI, providing other
legal services for OHI in connection with transactional negotiations, drafting
and review of minutes of meetings of the Board of Directors, drafting and review
of employment agreements, review of indemnification provisions of the Articles
and Bylaws of OHI and preparation of indemnification agreements between OHI and
its officers and directors.
2. OHI and Xxxxx agree that none of the services to be rendered by
Xxxxx for which he is to be compensated pursuant to this agreement is or will be
in connection with the offer or sale of securities in a capital raising
transaction and will not directly or indirectly promote or maintain a market for
OHI's common stock.
3. Xxxxx shall devote his best efforts to rendering the above services
to OHI and will make himself available to OHI on a regular and continuing basis.
Xxxxx shall not be required to devote any minimum number of hours and shall not
be required to maintain records of the time he devotes to the Transaction. OHI
agrees to reimburse Xxxxx for travel and incidental expenses incurred in
rendering services to OHI with OHI's prior approval. Xxxxx'x obligation to
render services to OHI under this agreement shall terminate upon the earlier of
the closing of the Transaction between OHI and the company or six months from
the date of this agreement.
4. OHI agrees that it will make available to Xxxxx any and all books
and records which he shall require to assist him in performing the services.
Xxxxx acknowledges that he shall be bound by the attorney-client privilege with
respect to all documents furnished by OHI to Xxxxx and communications between
Xxxxx and consultants engaged by OHI shall be subject to the attorney-client
privilege and shall not be disclosed to any third party without the prior
written consent of OHI unless otherwise required by law.
5. In consideration for the services set forth above OHI will issue to
Xxxxx an aggregate of 1,600,000 shares of OHI common stock (Shares) which shall
be valued at $.10 per share. In the event that Xxxxx realizes less than $150,000
from the sale of all Shares, Xxxxx shall give notice thereof to OHI and OHI
shall immediately issue to Xxxxx a number of Shares, which when valued at the
then current market price, shall equal the difference between the amount
realized by Xxxxx from the sale of the Shares and $150,000. In the event that
Xxxxx shall realize in excess of $150,000 from the sale of the Shares, he shall
retain such amount and OHI shall have no right to reimbursement of such excess.
6. The Shares and any additional Shares issued pursuant to Paragraph 5
of this Agreement, shall be promptly registered by OHI on Form S-8 and
certificates representing the Shares shall be delivered to Xxxxx, in his name,
without legend or stop transfer order following the effective date of such
registration.
7. The Shares will be considered paid for and earned by Xxxxx upon
execution of this Agreement.
Agreed to on the date set forth above by and between the signatories
below.
OHI
OHANA ENTERPRISES, INC.
By:/s/_________________________
XXXXXXXXX XXXXXXXX,
Vice President, CFO
/s/
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XXXXX X. XXXXX
