FINANCIAL PUBLIC RELATIONS SERVICES AGREEMENT
This Financial Public Relations Services Agreement ('Agreement') is
made as of the 8th day of July, 1999, by and between THE PUBLISHING COMPANY OF
NORTH AMERICA, INC. 186 PCNA PARKWAY, LAKE HELEN, FL 32744, a Florida
corporation hereinafter referred to as 'PCNA' or 'Client,' and INTERWEST
ASSOCIATES, 10 IMA LOA COURT, SUITE 1000, NEWPORT BEACH, CA 92663 hereinafter
referred to as 'ITWA'.
HEREAFTER, the Client and ITWA are referred to collectively as 'Parties' and
singularly as 'Party'.
R E C I T A L S
- - - - - - - -
A. The Client is a leader in the publishing of city, county and state
bar association print directories throughout the United States and
selling advertising in those directories. The Client is embarking
upon a new Internet business direction featuring a legal portal, a
legal superstore, and an online vendor directory.
B. The Client seeks assistance in communicating with the
broker-dealer and investment community, and desires to increase
the awareness of its common stock prospects among high producing
retail stockbrokers, market makers, small/micro-cap fund managers
and securities analysts.
C. ITWA specializes in providing public and investor relations
services to assist companies in establishing and maintaining good
relationships with brokerage firms, and in communicating
effectively with investors, shareholders, market makers,
securities analysts and others in the investment community.
D. The Client desires to engage ITWA to provide services in
connection with the financial public relations needs of PCNA.
THEREFORE, the Client hereby engages the services of ITWA and in
consideration of the mutual pledge herein contained, the parties hereby agree as
follows:
1. TERM. This Agreement shall commence on the date first above written and
shall continue until a date twelve (12) months after the date of this
Agreement unless extended by mutual written agreement of the parties to
this Agreement. ITWA has the right to terminate this Agreement in its sole
discretion if Client violates or proposes to violate any applicable federal
or state law, rule or regulation. PCNA may also terminate this Agreement in
its sole discretion. ITWA may terminate this Agreement with prior 30-day
notice in the event that the client should fail to compensate ITWA any or
part of the compensation set forth in Section 5 of this Agreement. ITWA may
terminate Agreement if the payment has not been received by the Client, as
specified under Section 5 of this Agreement, within fifteen (15) days from
the date the payment is due.
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2. SERVICES. ITWA shall provide consulting services to PCNA in connection with
the establishment of good relations by PCNA with the investment community,
which include the following services:
(a) Develop, implement and maintain an ongoing stock market support system
with the general objective of expanding stockbroker awareness of PCNA
activities, and hence to generate interest in PCNA's stock.
(b) Develop, implement and maintain a system to keep existing stockholders
informed with regards to PCNA's activities and potential, build a
national network of stockbrokers who are informed about and interested
in PCNA, and develop leads for select brokers to assist them in their
marketing of PCNA's stock.
(c) Seek to obtain market makers for PCNA's stock.
(d) Seek to obtain analyst coverage and reports with respect to PCNA and
its business, including follow-up coverage when applicable.
Services provided by ITWA are hereby acknowledged by the parties to
this Agreement to be limited to those specified herein and are not intended to
include any securities brokerage services.
3. USE OF AGENTS OR ASSISTANTS. To the extent reasonably necessary to enable
ITWA to perform its duties as set forth in Section 2 hereunder, ITWA shall
be authorized to engage the services of any agent which it deems proper,
and it may further employ, engage, or retain the services of such other
persons or corporations ('Agents') to aid or assist it in the proper
performance of its duties. Any Agents engaged by ITWA shall be subject to
all of the restrictions imposed upon ITWA by this Agreement, and ITWA shall
use its best efforts to ensure that any Agents are bound by the
restrictions.
4. NO GUARANTEE. Nothing in this Agreement or in the ITWA statements to PCNA
will be construed as a guarantee regarding the outcome of PCNA's future
common stock price. ITWA makes no such promises or guarantees. ITWA's
comments regarding the business and future prospects of PCNA, if any, are
expressions of opinion only and are not intended for sale or solicitation
of securities. All opinions and estimates included within any ITWA
literature are for information purposes only and are not intended as an
offer or solicitation with respect to the purchase or sale of any security.
ITWA must comply with SEC guidelines with respect to being compensated for
any financial marketing of PCNA's stock including Section 17(b) of the
Securities Act of 1933.
5. COMPENSATION AND EXPENSE REIMBURSEMENTS. In consideration for its services
pursuant to this Agreement, ITWA shall receive the following compensation
and expense reimbursements:
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(a) CASH
The Client will pay to ITWA a fee equal to $6,000 upon the execution
of this Agreement by both parties hereto, $5,000 on the 8th day of
each month for the following two (2) months thereafter, and $3,000 for
the next nine (9) months, for a total of twelve (12) months.
(b) WARRANTS
As additional compensation, PCNA irrevocably grants to ITWA warrants
to purchase 225,000 shares of its common stock (the 'Warrants'), fully
vested and immediately exercisable at the prices listed below and
until the expiration dates listed below. The shares underlying the
Warrants shall be subject to restriction from sale, pledge, or
hypothecation for periods of time described below (a 'Lock-up'), after
which the shares underlying the Warrants shall be freely salable or
otherwise tradable.
No. of Exercise Lock-up on Warrants
Warrants Price sales until expire after
----------------------------------------------------------------------
25,000 $1.6875 N/A Jan. 7, 2001
25,000 $2.5000 Aug. 8, 1999 Feb. 7, 2001
25,000 $3.0000 Sept. 8, 1999 Mar. 7, 2001
16,667 $3.5000 Oct. 8, 1999 Apr. 7, 2001
16,667 $4.0000 Nov. 8, 1999 May 7, 2001
16,667 $4.5000 Dec. 8, 1999 June 7, 2001
16,667 $5.0000 Jan. 8, 2000 July 7, 2001
16,667 $5.5000 Feb. 8, 2000 Aug. 7, 2001
16,667 $6.0000 Mar. 8, 2000 Sep. 7, 2001
16,667 $6.5000 Apr. 8, 2000 Oct. 7, 2001
16,667 $7.0000 May. 8, 2000 Nov. 7, 2001
16,664 $7.5000 June 8, 2000 Dec. 7, 2001
(i) Protection Against Dilution. If all or any portion of the Warrants
are exercised subsequent to the occurrence of any stock dividend,
stock split, combination or exchange of shares, reclassification
or recapitalization of the Company's common stock, reorganization
of the Company, consolidation with or merger into or sale or
conveyance of all or substantially all of the Company's assets to
another corporation or any other similar event, the holder of the
Warrants exercising any shall receive, upon exercise of such
Warrant at the exercise price, the aggregate number and class of
shares which such holder would have received if the Warrant had
been exercised immediately prior to such or exchange of shares,
reorganization, consolidation, merger or sale or in the event of a
stock dividend, stock split combination or recapitalization, the
exercise price and the number of shares issuable upon exercise
shall be proportionately adjusted.
(ii) As soon as practicable, PCNA shall at its sole cost, except any
counsel fees of ITWA, file a registration statement on Form S-3,
or other available form, covering the public sale of the shares of
common stock issuable upon exercise of the Warrants (the
'Registerable Securities') and use its best efforts to have it
declared effective with the Securities and Exchange Commission.
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(iii)PCNA shall also:
(A) Supply to ITWA two (2) executed copies of each
registration statement and a reasonable number of
copies of the final prospectus in conformity with
requirements of the Securities Act of 1933 (the
'Act') and the Rules and Regulations promulgated
thereunder and such other documents as ITWA shall
reasonably request.
(B) Use its best efforts to cause the Registerable
Securities to be available to be sold in the State of
New York and registered or qualified under such other
securities acts or blue sky laws of such
jurisdictions as ITWA shall reasonably request as
long as such jurisdictions do not exercise a 'merit
review' of the offering and do any and all other acts
and things which may be necessary or advisable to
enable ITWA to consummate such proposed sale or other
disposition of the Registerable Securities in any
such jurisdiction; provided, however, that in no
event shall PCNA be obligated, in connection
therewith, to qualify to do business or to file a
general consent to service of process in any
jurisdiction where it shall not then be qualified.
(C) Keep the registration statement effective until the
expiration date of the Warrants and cooperate in
taking such action necessary to permit the public
sale or other disposition of such Registerable
Securities by ITWA.
(D) Indemnify and hold harmless ITWA and each
underwriter, within the meaning of the Act, who may
purchase from or sell for ITWA, any Registerable
Securities, from and against any and all losses,
claims, damages, and liabilities (including, but not
limited to, any and all expenses whatsoever
reasonably incurred in investigation, preparing,
defending or settling any claim) arising from (1) any
untrue or alleged untrue statement of material fact
contained in any such registration statement or any
prospectus contained therein or delivered thereunder,
or from (2) any omission to state therein a material
fact required to be stated therein or necessary to
make the statements therein not misleading, unless
each untrue statement or omission or such alleged
untrue statement or omission was based upon
information furnished or required to be furnished in
writing to PCNA by ITWA or underwriter expressly for
use therein, which indemnification shall include each
person, if any, who controls ITWA or underwriter
within the meaning of the Act. Provided, however,
that PCNA shall not be so obligated to indemnify ITWA
or underwriter or controlling person unless ITWA and
underwriter shall at the same time indemnify the
Company, its directors, each officer signing any
registration statement or any amendment to any
registration statement and each person, if any, who
controls PCNA within
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the meaning of the Act, from and against any and all
losses, claims, damages and liabilities (including,
but not limited to, any and all expenses whatsoever
reasonably incurred in investigation, preparing,
defending or settling any claim) arising from (3) any
untrue or alleged untrue statement of a material fact
contained in the registration statement or any
amendment thereto, or prospectus contained therein or
(4) any omission or alleged omission to state therein
a material fact required to be stated therein or
necessary to make the statements therein not
misleading, but the indemnity of ITWA, underwriter or
controlling person shall be limited to liability
based upon information furnished in writing to PCNA
by ITWA or underwriter or controlling person
expressly for use therein. The indemnity agreement of
PCNA herein shall not inure to the benefit of ITWA or
any such underwriter (or to the benefit of any person
who controls ITWA or such underwriter) on account of
any losses, claims, damages, liabilities (or actions
or proceedings in respect thereof) arising from the
sale of any such Registerable Securities by ITWA or
such underwriter to any person if such underwriter
failed to send or give a copy of the prospectus as
the same may then be supplemented or amended (if such
supplement or amendment shall have been furnished to
ITWA or the underwriter) to such person with or prior
to written confirmation of the sale involved. By its
signature, ITWA agrees to the indemnification
provided above.
(iv) PCNA shall comply with the requirements of Section 5(b)(vi) and
(vii) at its own expense, including legal, accounting, filing,
state qualifications, and printing fees and costs, but excluding
counsel fees for the selling stockholders.
(v) PCNA's obligation under Section 5(b)(vi) and (vii) shall be
conditioned, as to each such public offering, upon a timely
receipt by PCNA in writing of:
(A) Information as to the terms of such public offering
furnished by or on behalf of ITWA or underwriter
intending to make a public distribution of its
Registerable Securities; and
(B) Such other information as PCNA may reasonably require
from ITWA and any underwriter for inclusion in such
registration statement.
6. MISCELLANEOUS EXPENSES. The Client will bear all of the costs relating to
the preparation and presentation of materials to its stockholders and the
investment community, which are not specified under Section 2 of this
Agreement. Client agrees to reimburse ITWA on a monthly basis for all of
the expenses incurred by ITWA that fall outside the scope of services as
identified under Section 2, including but not limited to travel, lodging,
lead generation, advertising, design and print costs, and related expenses.
Provided, however, PCNA's liability for any individual costs shall not
exceed $100 without the express written consent of PCNA's President.
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7. DEVOTION OF TIME. ITWA shall devote a substantial amount of its time to the
performance of its duties under this Agreement which is necessary for a
satisfactory performance. Should the Client require additional services not
included in the Agreement, ITWA shall make a reasonable effort to fit such
additional services into its time schedule without decreasing the
effectiveness of its performance or its duties hereunder.
8. ENTIRE AGREEMENT. This Agreement supersedes any and all other agreements,
either oral or in writing, between the parties hereto with respect to the
subject matter hereof, and no other agreement, statement, or promise
relating to the subject matter of this Agreement which is not contained
herein shall be valid or binding.
9. ASSIGNMENT. Neither this Agreement nor any duties shall be assignable by
ITWA without the prior written consent of the Client, although ITWA may
delegate duties as contemplated in Section 3 herein. In the event of an
assignment by ITWA to which the Client has consented, the assignee or his
legal representative shall agree in writing with the Client to personally
assume, perform, and be bound by the covenants, and agreements contained
herein.
10. SUCCESSORS AND ASSIGNMENT. Subject to the provision regarding assignment,
this Agreement shall be binding on the heirs, executors, administrators,
successors, and assigns of the respective parties.
11. ATTORNEY'S FEES. If any action at law or in equity is brought to enforce or
interpret the provisions of this Agreement, or to collect any amounts
payable pursuant to this Agreement, the prevailing party shall be entitled
to full reimbursement of reasonable attorney's fees and costs in addition
to any other relief to which it may be entitled.
12. GOVERNING LAW. The validity of this Agreement and of any of its terms or
provisions, as well as the rights and duties of the parties hereunder shall
be governed by the law of the State of California.
13. SEVERABILITY. In the event any provision of this Agreement is deemed
unenforceable or ineffective, it shall not affect the enforceability or
effectiveness of any other provision of this Agreement, and all other
provisions of this Agreement shall remain in full force and effect.
14. INDEMNIFICATION. The Client agrees to indemnify and hold ITWA and its
partners, officers, directors, employees, agents and affiliates harmless
from and against any and all loss, claim, damage, liability and expense
(including, without limitation, costs of investigation, legal and other
fees and expenses incurred in connection with, and any amounts paid in
settlement of, any action, suit or proceeding or any claim asserted), to
which ITWA may become subject under the United States or foreign securities
laws or any applicable statute or regulation of jurisdiction, or at common
law (whether tort, contract or any other basis), or otherwise, insofar as
such loss, claim, damage, liability expense arises from, or is based upon,
in whole or in part: (i) a material breach of this Agreement by the Client,
or (ii) an untrue statement of a material fact or omission to state a
material fact, or allegation of an untrue statement of a material fact or
omission to state a material fact, by the Client in any documents or
information provided to the investment
Page 6
community or to individual investors, which was necessary in order to make
the statements made, in light of the circumstances under which they were
made, not misleading, to the extent such breach, untrue statement or
omission is the cause of the loss, claim, damage, liability or expense.
15. NON-CIRCUMVENTION. ITWA will from time to time introduce potential funding
sources and/or sales agents (collectively, the 'Contact' or 'Source') to
the Client for the purpose of fulfilling obligation to the Client. The
Client covenants not to circumvent ITWA, either directly or indirectly,
with respect to any Contact/Source introduced to the Client by the ITWA.
16. CONFIDENTIALITY. The parties agree to maintain as confidential, and not to
disclose to any third party without the prior consent of the other party,
any information of a proprietary nature which one party learns from the
other party as part of the necessary process of performing their services
and obligations under this Agreement, other than information (a) which was
already public knowledge at the time it was learned by the party, or which
subsequently came into the public domain through no fault of the receiving
parties; (b) which is necessary or appropriate to disclose in order to
comply with applicable laws, rules and regulations or enable a party to
comply with this Agreement; (c) which was lawfully received by the
receiving party from a third party free of an obligation of confidence to
such third party; (d) which was already in the possession of the receiving
party prior to the receipt thereof, directly or indirectly, from the
disclosing party; (e) which is required to be disclosed in a judicial or
administrative proceeding after all reasonable legal remedies for
maintaining such information in confidence have been exhausted including,
but not limited to, giving the disclosing party as much advance notice of
the possibility of such disclosure as practical so the disclosing party may
attempt to obtain a protective order concerning such disclosure; or (f)
which is subsequently and independently developed by employees,
consultants, or agents of the receiving party without reference to the
confidential information disclosed under this Agreement.
17. EQUITABLE RELIEF. The parties agree that money damages would not be a
sufficient remedy for breach of the Non-Circumvention, confidentiality and
other obligations of this Agreement. Accordingly, in addition to all other
remedies that either party may have, each party shall be entitled to
specific performance and injunctive or other equitable relief as a remedy
for any breach of the non-circumvention, confidentiality and other
obligations of the other party under this Agreement. The defaulting party
agrees to waive any requirement for a bond in connection with any such
injunctive or other equitable relief.
18. NOTICES. Any notices given pursuant to this Agreement shall be in writing
and shall be deemed received by the party to be notified upon personal
delivery, facsimile, air courier, registered mail, return-receipt
requested, or 72 hours after mailing by the notifying party by first class
mail to the address set forth below the party's signature in this
Agreement, or to such other different address as the party shall notify the
other party in writing in accordance with the terms of this Agreement. It
is also set forth in this Agreement that facsimile signatures are
acceptable and bind the Parties to the terms of this Agreement.
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19. INDEPENDENT CONTRACTORS. ITWA is an independent contractor with respect to
the Client under this Agreement. No partnership, joint venture, employment
or fiduciary relationship is intended between the parties to this
Agreement. ITWA shall have sole discretion in determining the methods and
means of performing its services under this Agreement, and in supplying the
tools and instruments used by it pursuant to this Agreement.
20. ARBITRATION. ANY CONTROVERSY OR CLAIM OF ANY KIND OR NATURE WITH REGARD TO
THIS AGREEMENT WHETHER CONTRACT, TORT, OR OTHERWISE, SHALL BE SETTLED BY
BINDING ARBITRATION IN ACCORDANCE WITH THE COMMERCIAL ARBITRATION RULES OF
THE AMERICAN ARBITRATION ASSOCIATION, AND JUDGMENT ON THE AWARD RENDERED BY
THE ARBITRATORS MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. THE
PARTIES HERETO ACKNOWLEDGE THAT THIS PROVISION AFFECTS THEIR LEGAL RIGHTS
AND AGREE TO BE BOUND UNDER ANY AND ALL CIRCUMSTANCES TO THE DETERMINATION
OF SUCH BINDING ARBITRATION. THE PREVAILING PARTY IN ANY ARBITRATION
INSTITUTED UNDER THIS AGREEMENT SHALL, IN ADDITION TO OTHER REMEDIES, BE
ENTITLED TO BE REIMBURSED BY THE OTHER PARTY FOR ALL EXPENSES OF SUCH
ARBITRATION, INCLUDING REASONABLE ARBITRATOR'S AND ATTORNEYS' FEES.
Executed as of the day and year first above written.
ITWA: INTERWEST ASSOCIATES CLIENT: THE PUBLISHING CO. OF
NORTH AMERICA, INC.
By: /s/ Ajay Anand By: /s/ Peter S. Balise
---------------------------- -----------------------------------
Ajay Anand, Partner Peter S. Balise, President
10 Ima Loa Court, Suite 1000 186 P.C.N.A. Parkway
Newport Beach, CA 92660 Lake Helen, FL 32744
Telephone: (949) 645-8325 Telephone: (904) 228-1000, Ext. 305
Facsimile: (949) 645-8559 Facsimile: (904) 228-0271
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Financial Public Relations Services Agreement - The Publishing Co. of North America Inc. and Interwest Associates
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