AGREEMENT
AGREEMENT
This
Agreement (the “Agreement”)
made
this 25th day of March 2008, is by and between Purple Beverage Company (the
“Company”) and Esquire Sports Marketing L.L.C.. (“Esquire”).
RECITALS:
Whereas,
Purple is seeking athletes in connection with the endorsement of, and the
advertising and promotion for, the Company’s product, “Purple” (“Endorsed
Product”);
Whereas,
the Company has retained Esquire as a consultant to secure celebrity
endorsements of the Endorsed Product and Esquire would like to retain the
services of Locker Room Memorabilia and other agencies to make an introduction
between the Company and Xxxxxxx Xxxxxx (the “Athlete”) and to make introductions
to various other athletes to endorse the Endorsed Product as described
herein.
NOW
THEREFORE, in consideration of the foregoing premises and other good and
valuable consideration the parties agree and acknowledge, as
follows:
1. LRM
has a
pre-existing relationship with the Athlete and the Company does not have a
pre-existing relationship with the Athlete.
2. The
Company agrees that LRM is authorized to introduce (through its authorized
representative Esquire Sports Marketing, L.L.C.) the Athlete and various other
athletes to the Company and to provide the Athlete and/or athletes with
pertinent information pertaining to the Endorsed Product (the “Introduction”).
3. The
Company agrees to pay Esquire a Fee (as defined below) for the Introduction
if
the Introduction leads to or results in the Athlete endorsing the Endorsed
Product. As used herein, “Fee” shall mean: (a) Twenty Five Thousand Dollars
($25,000) payable to LRM via wire transfer pursuant to the instructions set
forth on Schedule B and (b) 160,000 shares of common stock of the Company (the
“Compensation Shares”). The Compensation Shares shall be represented by one or
more stock certificates issued to Esquire in denominations as set forth on
Schedule A annexed hereto. The Company acknowledges that Esquire shall have
the
right to assign such Compensation Shares to LRM and/or other sub agencies upon
the expiration of any lock-up period set forth herein. All Compensation Shares
shall be delivered to Esquire promptly upon execution of an endorsement
agreement with the Athlete. The Company acknowledges that Esquire, LRM and
other
sub agencies may be entitled to additional compensation to be mutually agreed
upon by the parties hereto to the extent that additional athletes are signed
utilizing introduction made by LRM or such other sub agencies to such
Athletes.
4. In
connection with the issuance of the Compensation Shares, Esquire hereby makes
the following representations to Company regarding the Compensation
Shares:
(a) Esquire
understands that none of the Compensation Shares have been registered under
the
Securities Act of 1933, as amended (“Securities Act”), by reason of a specific
exemption from the registration provisions of the Securities Act, the
availability of which depends upon, among other things, the bona fide nature
of
the investment intent and the accuracy of Esquire’s representations as expressed
herein. Esquire is acquiring all of the Compensation Shares for his own account,
not as a nominee or agent, for investment and not with a view to, or for resale
in connection with, any distribution or public offering thereof within the
meaning of the Securities Act.
(b) Esquire
understands that all of the Compensation Shares will constitute “restricted
securities” under the federal securities laws, inasmuch as it is being acquired
from Company or such other company in one or more transactions not involving
a
public offering and that under such laws the Compensation Shares may not be
resold without registration under the Securities Act or an exemption therefrom.
The certificates representing the Compensation Shares will be endorsed with
a
legend to such effect. Esquire has been informed and understands that (i) there
are substantial restrictions on the transferability of the Compensation Shares,
and (ii) no federal or state agency has made any finding or determination as
to
the fairness for public investment, nor any recommendation nor endorsement,
of
the Compensation Shares.
(c) Esquire,
or Esquire’s business and financial advisors, have substantial experience in
evaluating and investing in private transactions of securities in companies
similar to Company and such other company and Esquire acknowledges that it
can
protect its own interests. Esquire, or such advisors, have such knowledge and
experience in financial and business matters so that it is capable of evaluating
the merits and risks of its acceptance of all of the Compensation Shares of
Company as compensation or otherwise.
(d) Esquire
is an “accredited investor” within the meaning of Rule 501 of Regulation D
promulgated under the Securities Act.
(e) Esquire
understands that all books, records, and documents of Company relating to it
have been and remain available for inspection by him or his business and
financial advisors upon reasonable notice. Esquire confirms that all documents
requested have been made available, and that it or such advisors have been
supplied with all of the information concerning Company that has been requested.
Esquire confirms that it or such advisors have obtained sufficient information,
in its and their judgment to evaluate the merits and risks of receipt of the
Compensation Shares as compensation or otherwise. Esquire confirms that it
has
had the opportunity to obtain such independent legal and tax advice and
financial planning services as it has deemed appropriate prior to making a
decision to enter this Agreement, provide the Service Days and the Personal
Appearances in consideration of the issuance to it of the Compensation Shares.
In making each such decision, Esquire has relied exclusively upon its experience
and judgment, or that of such advisors, upon such independent investigations
as
it, or they, deemed appropriate, and upon information provided by Company in
writing or found in the books, records, or documents of Company.
(f) Esquire
is aware that the economic ownership of the Compensation Shares is highly
speculative and subject to substantial risks. Esquire is capable of bearing
the
high degree of economic risk and burdens of this venture, including, but not
limited to, the possibility of a complete loss, the lack of a sustained and
orderly public market, and limited transferability of the Compensation Shares,
which may make the liquidation thereof impossible for the indefinite
future.
(g) The
offer
to issue the Compensation Shares as compensation to the Esquire was directly
communicated to Esquire or its business or financial advisors by such a manner
that he or such advisors were able to ask questions of and receive answers
from
Company or a person acting on its behalf concerning this Agreement. At no time
was he presented with or solicited by or through any leaflet, public promotional
meeting, television advertisement, or any other form of general
advertising.
(h) None
of
the following information has ever been represented, guaranteed, or warranted
to
Esquire, expressly or by implication by any broker, Company, or agent or
employee of the foregoing, or by any other person:
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(1) The
approximate or exact length of time that Esquire will be required to remain
as a
holder of any of the Compensation Shares;
(2) The
amount of consideration, profit, or loss to be realized, if any, as a result
of
owning any of the Compensation Shares; or
(3) That
the
past performance or experience of Company, its officers, directors, associates,
agents, affiliates, or employees or any other person will in any way indicate
or
predict economic results in connection with the plan of operations of Company
or
the return on any of the Compensation Shares.
(i) Esquire
hereby agrees to indemnify Company and its affiliates and to hold them harmless
from and against any and all liability, damage, cost, or expense, including
their respective attorneys’ fees and costs, incurred on account of or arising
out of:
(1) Any
material inaccuracy in the declarations, representations, and warranties
hereinabove set forth;
(2) The
disposition of the Compensation Shares or any part thereof by him, directly
or
indirectly, contrary to the foregoing declarations, representations, and
warranties; and
(3) Any
action, suit, or proceeding based upon:
(A) the
claim
that said declarations, representations, or warranties were inaccurate or
misleading or otherwise cause for obtaining damages or redress from Company
or
its affiliates; or
(B) the
disposition of the Compensation Shares or any part thereof.
(j) Esquire
hereby agrees that it shall not sell any of the Compensation Shares without
the
express written consent of the Company at any time prior to the six (6) month
anniversary of the date hereof. All subsequent sales of the Compensation Shares
shall be subject to applicable federal and state securities laws.
5. The
term
of this Agreement shall be for a period of one (1) month from the date of this
Agreement. This Agreement shall expire and be of no further force and effect
on
the one-month anniversary of the date of this Agreement and no compensation
would be due to Esquire if Athlete does not endorse the Endorsed Product by
such
date.
6. Neither
the Athlete nor the Company is obligated or required to consummate any
endorsement agreement with respect to the Endorsed Product.
7. This
is
the entire agreement by and between the parties and may only be amended by
a
subsequent written agreement signed by the parties.
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8. This
Agreement is made and entered into in New York County, New York and governed
by
New York law. Any legal action pertaining to this Agreement shall be brought
in
New York County, New York.
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date
of the first written above.
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By:
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/s/
Xxxxxxx Xxxxxxx
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Name:
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Xxxxxxx
Xxxxxxx
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Title:
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Chief
Financial Officer
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ESQUIRE
SPORTS MARKETING, L.L.C.
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By:
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/s/
Xxxxxx Xxxxxxxx
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Xxxxxx
Xxxxxxxx
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Title:
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Managing
Member
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