EXHIBIT 10(iv)
ENGAGEMENT LETTER WITH WEED AND COMPANY
March 13, 2003
Xxxxxx X. Xxxxxx, Xx.
C.E.O. U.S. West Homes, Inc.
000 Xxxxxxxx, 0xx Xxxxx
Xxxxxx Xxxxx, XX 00000
Telephone 000.000.0000
Facsimile 949.376.9117
RE: Special Projects
Dear Merv:
The purpose of this letter is to set forth the terms and conditions that will
govern our relationship.
This agreement is between U.S. West Homes, Inc. ("Client") whose address is 000
Xxxxxxxx, 0xx Xxxxx, Xxxxxx Xxxxx, XX 00000 and Xxxxxxx X. Xxxx of Weed & Co.
LLP ("Weed") whose address is 0000 XxxXxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx Xxxxx,
Xxxxxxxxxx 00000.
Weed shall render the following legal services described in Exhibit A attached
hereto and Client may engage Weed on any new matters referenced in Exhibit A in
exchange for payment of fees determined in accordance with this Agreement. Weed
makes no promises or guarantees regarding the outcome of matters upon which Weed
is engaged to represent the Client.
To protect both of the parties and to comply with professional obligations, we
have already discussed with each other and resolved any potential conflicts of
interest with present or former clients. The services that Weed will provide
shall be in accordance with the following terms and conditions.
RETAINER
To initiate the relationship, Client agrees to deliver a cash retainer fee of
$4,000 to Weed upon Client's execution of this Agreement.
PROFESSIONAL FEES
Fees will be based upon the reasonable value of Weed's services as determined in
accordance with the American Bar Association Model Code of Professional
Responsibility and the California & Texas Rules of Professional Conduct. Fees
will be based on the rates charged by Weed.
Weed's rate is $300 per hour. It is anticipated that Client and Weed will agree
on a fixed fee for special projects from time to time. The fixed fee
arrangements for special projects will be agreed to in writing. Weed's fees may
be paid in cash or as follows:
As payment for services, Client has proposed and Weed has agreed that Client
place a block of 2,000,000 shares of free trading stock in Weed's name with a
nationally known securities broker-dealer. At least once a month, Weed will send
Client a statement for fees and costs, with written notice to the brokerage firm
of the dollar amount of such statement. Unless objection is made to the xxxx,
sufficient Client stock, net of commission, shall then be liquidated forthwith
at the prevailing market rate to satisfy such statement. Weed has not been
engaged to perform, nor will Weed agree to perform any services in connection
with a capital raising transaction in exchange for shares registered on Form
S-8. The rules and regulations of the United States Securities and Exchange
Commission do not allow the use of a Form S-8 registration statement under such
circumstances. Any fees for services that are in connection with a capital
raising transaction shall be paid in cash or registered on another form of
registration statement.
In the course of Weed's representation of the Company, if all the stock is
liquidated, a new block of stock sufficient to cover projected fees and costs,
in an amount contemporaneously agreed to by the parties, will again be placed
with the brokerage firm, under the terms and conditions outlined above. At the
conclusion of Weed's representation of Client and the payment of all final fees
and costs, any unused stock shall forthwith be returned to Client.
Client has agreed to promptly register such blocks of stock pursuant to Form S-8
or other applicable registration statement at its own expense and deliver such
stock to the Weed or brokerage firm upon the filing and effectiveness of the
registration statement.
Client further understands that during the course of Weed's engagement, it may
be necessary or advisable to delegate various portions of this matter to others.
STOCK OPTION
As an incentive for Weed to represent the Client and to increase Weed's
proprietary interest in the success of the Company, thereby encouraging him to
maintain his relationship with the Company, the Client hereby grants to Weed
options to purchase shares of the Client's common stock. As an initial option,
the Client hereby grants Attorney the right to purchase 1,000,000 shares of the
Client's common stock at a price of $.04 per share. Further, every six months
following the date hereof that this agreement remains in effect, the Company
shall grant to Weed an option to purchase an additional 500,000 shares of
Client's common stock at a price equal to 125% of the average closing bid price
for the 10 days immediately prior to the date of the grant. All stock options
are non-transferable and will expire unless exercised on or before December 31,
2008 or 5 years from the date of the grant, whichever is later. Client has
agreed to promptly register the shares of common stock underlying the stock
options at its own expense.
The options granted will not be subject to dilution (i.e. no adjustment to the
number of shares or the exercise price) based upon any reverse split of the
Client's common stock. The stock options shall be exercisable in whole or in
part with a promissory note of less than 45 days duration or upon common
"cashless exercise" terms.
Client shall cause any subsidiary or parent corporation to adopt and be bound by
this Agreement and all its provisions.
COSTS AND EXPENSES
Client understands that in the course of representation, it may be necessary for
Weed to incur certain costs or expenses. Client will reimburse Weed for certain
costs or expenses actually incurred and reasonably necessary for completing the
assigned matter, as long as the charges for costs and expenses are competitive
with other sources of the same products or services and approved by Client in
advance. More particularly, Client will reimburse Weed in accordance with the
following guidelines:
1. COMPUTER-RELATED EXPENSES - Client will reimburse Weed for computerized
research and research services. However, any charges over $500 per month will
require approval. Client also encourages Weed to utilize computer services that
will enable Weed to more efficiently manage the projects.
2. TRAVEL - Client will reimburse Weed for expenses in connection with out of
town travel. However, Client will only reimburse for economy class travel and,
where necessary, for the reasonable cost of a rental car. All related travel
expenses, i.e., lodging and meals, must be reasonable under the circumstances.
3. FILING FEES & COURT COSTS - Client will reimburse Weed for expenses incurred
in connection with filing fees and court costs, if any, but will not be
responsible for sanctions or penalties imposed due to the conduct of Weed.
Client shall pay and hold Weed harmless from all such costs and expenses
incurred on Client's behalf. Weed may, but shall not be obligated to, advance
funds on Client's behalf. In such event, Client agrees to reimburse Weed upon
demand for the amounts advanced. Substantial outside fees (such as state filing
fees or SEC filing services) may be referred to Client for direct payment.
BILLING
All bills will include a summary statement of the kinds of services rendered
during the relevant period. Client expects that Weed will maintain back-up
documentation for all expenses. Client expects to be billed monthly or at the
conclusion of each project and agrees to pay Weed's invoices within fifteen days
of receipt. Weed shall xxxx in increments of one-quarter (1/4) hour unless
otherwise agreed in writing.
DELAY IN PAYMENT
In the event that any of Weed's bills remain unpaid for more than 30 days after
receipt by Client, Weed shall have the right to discontinue rendering further
services to Client in connection with any matter then being handled for Client
by Weed.
INVOLVEMENT OF CLIENT
Client expects to be kept closely involved with the progress of Weed's services
in this matter. Weed will keep Client apprised of all material developments in
this matter, and will provide sufficient notice to enable a representative to
attend meetings, conferences, and other proceedings.
There may be times when Weed will need to obtain information from Client. All
requests for access to documents, employees, or other information shall be
granted without unreasonable delay.
TERMINATION
Client shall have the right to terminate Weed's engagement by written notice at
any time. Weed has the same right to terminate this engagement, subject to an
obligation to give Client reasonable notice to permit it to obtain alternative
representation or services and subject to applicable ethical provisions. Weed
will be expected to provide reasonable assistance in effecting a transfer of
responsibilities to the new service provider.
DISPUTES
The laws of the State of California shall govern the interpretation of this
agreement, including all rules or codes of ethics that apply to the provision of
services. All disputes between us arising out of this engagement which cannot be
settled, shall be resolved in a federal or state court located in Orange County,
California.
If the foregoing accurately reflects our agreement regarding professional
services, please sign and return a duplicate copy of this letter. Thank you in
advance for your prompt attention to this matter.
Very truly yours,
/s/ Xxxxxxx X. Xxxx
Xxxxxxx X. Xxxx
Managing Partner
Approved and Agreed
U.S. West Homes, Inc.
By:/s/ Xxxxxx X. Xxxxxx, Xx.
Name: Xxxxxx X. Xxxxxx, Xx.
Title: C.E.O.
EXHIBIT A
Weed shall review the Form 10-K or Form 10-KSB upon completion of the audit and
prior to filing with the Securities and Exchange Commission. From time to time
thereafter, Weed will assist Client with its SEC filings.
Weed shall assist with the design, implementation and restructuring of Client as
directed.
