FINANCIAL PUBLIC RELATIONS AGREEMENT
This Financial Public Relations Agreement (this "Agreement") is made
and entered into effective the 1st of August, 1999 between USA TECHNOLOGIES, a
Pennsylvania corporation, (the "Company"), having offices at 000 Xxxxx Xxxxxx,
Xxxxx, Xxxxxxxxxxxx and X.X. Xxxxxx Group, Inc., a California Corporation (the
"Consultant"), having offices at 0000 Xxxxxx Xxxxx, Xxxxx 000, Xxxxxx, XX 00000,
based on the following:
Premise
A. The Company is a publicly held corporation whose securities are
listed on the OTC Bulletin Board market. The Company is seeking to
expand its investor base and the number of market professionals who
are aware of the Company's activities.
B. Consultant is established in the securities industry and has
experience in providing advice and support for publicly held
companies.
C. The Company desires to retain the services of Consultant, and
Consultant desires to offer such services on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, based on the foregoing premises, and in consideration
of the mutual covenants of the parties and the benefits to be derived
therefrom, it is hereby agreed as follows:
Agreement
1. Engagement of Consultant. The Company hereby engages Consultant to
provide services to the Company under the terms of this Agreement,
including, but not limited to, the analysis of business and proposed
business of the Company by the Consultant as it pertains to the
desirability and suitability of an investment in the Company by equity
participants; the presentation of the Company to market professionals,
including broker-dealers, mutual funds, and other institutional
investors; providing the Company advice concerning shareholder
relations and the preparation of information for the Company's
shareholders; assisting in long-term financial planning, including
borrowings, equity financing and other opportunities; providing advice
concerning the existing and future capital structure of the Company.
Notwithstanding the foregoing. Consultant shall not act as an agent of
the Company and shall not contact the holders of the securities of the
Company in connection with the exercise or conversion of currently
issued and outstanding warrants, options, or convertible securities.
2. Marketing. Company shall furnish to Consultant disclosure and filing
materials, financial statements, business plans, promotional materials,
annual reports and press releases. In addition, Company agrees to
distribute due diligence packages in ample quantities to potential
investors as well as to the brokerage community. Consultant may rely
on, and assume the accuracy of the due diligence package and/or
research reports. Consultant may disseminate through the use of the
media and advertisement the contents of the due diligence package and
any research reports in order to attract potential investors as well as
the brokerage community. Company acknowledges that Consultant is
engaged in other business activities during the term of this Agreement.
3. Advertising. Advertising is defined as the cost associated with lead
generation programs arranged by the Consultant for the Company. These
programs are designed to create investor awareness for the Company. All
advertising/lead generation programs are to be presented by the
Consultant to the Company and approved by the Company in advance.
4. Compensation to Consultant. Consultant is to receive an initial
$10,000.00 retainer, payable upon execution of this Agreement. Each
subsequent payment of $10,000.00 is to be paid on the 1st of each
month.
a. Consultant is to receive a Warrant to purchase 50,000 common
shares of USTT, @ $2.00 per share. Said Warrant shall be issued
within 6 months of this contract and shall have a 2-year term
from the date of issuance and shall be fully vested upon
issuance.
b. Consultant is to receive a Warrant to purchase 50,000 common
shares of USTT, @ $3.00 per share. Said Warrant shall be issued
within 6 months of this contract and shall have a 2-year term
from the date of issuance and shall be fully vested upon
issuance.
c. Consultant represents and warrants to the Company that it is an
Accredited Investor as such term is defined in Rule 501
promulgated under the Securities Act of 1933, as amended
("Act") . As a result thereof, the Warrants and the Common
Stock underlying the Warrants will be issued to the Consultant
pursuant to Rule 506 promulgated under the Act.
d. The Warrants and the Common Stock underlying the Warrants
issuable to the Consultant shall not be registered under the
Act or any state securities laws, and shall constitute
restricted securities as defined under Rule 144 promulgated
under the Act. Following the issuance of the Warrants, the
Company shall, at its expense, file and use its best efforts to
have declared effective, a registration statement under the Act
covering the resale by the Consultant of the Common Stock
underlying the Warrants. The Company shall use its best efforts
to have the resale of the Common Stock exempted from the
registration requirements under applicable state securities
laws.
5. Reimbursement of Costs. Consultant shall be responsible for all
advertising costs for its lead generation campaigns. All travel costs
are to be presented to the company in advance and are to be split on a
50/50 basis between the consultant and the company.
6. Term. This Agreement shall commence on the date hereof and will
terminate on earliest of the following:
a. The term of this Agreement is one-year from date of execution.
b. Company can terminate consultant for cause upon 30 days written
notice. Cause shall be determined solely as the following:
violation of any rule or regulation of any regulatory agency;
any other neglect, act or omission detrimental to the conduct
of Company business; material breach of the Agreement or any
unauthorized disclosure of any of the secrets or confidential
information of the Company; dishonesty related to independent
contractor status; a change in personnel, management control of
the Consultant which materially effects the Consultant's work
on behalf of the Company.
c. Notwithstanding anything else set forth herein, Company can
terminate consultant for any reason given 30 days written
notice to consultants legal address of 0000 Xxxxxx Xx. Xxxxxx,
XX 00000
d. The Consultant is to furnish to the Company activity reports on
a monthly basis.
7. Confidentiality. Consultant acknowledges that it may receive
confidential and proprietary information of the Company in connection
with the services provided under the terms of the Agreement. The
Consultant agrees to keep all such information confidential and to take
prudent steps to assure that its officers, directors, and employees,
and to not use such confidential information, except for the direct
benefit of the Company. Consultant shall not disclose such confidential
information and shall take reasonable steps to prevent the disclosure
by its officers, directors, and employees, without the prior written
consent of the Company.
8. Independent Consultant. The Company and Consultant hereby acknowledge
that Consultant is an independent contractor. Consultant shall not hold
itself out as, nor shall it take any action from which others might
infer that it is a partner or agent of or a joint venture with the
Company. Consultant shall have no authority to act on behalf of or bind
the Company and shall take no action, which purports to bind the
Company. The Company shall have no authority to act on behalf of or
bind the Consultant and shall take no action, which purports to bind
the Consultant.
9. Entire Agreement. This Agreement is and shall be considered to be the
only Agreement or understanding between the parties hereto with respect
to the engagement of Consultant by the Company. All negotiations,
commitments, and understandings acceptable to both parties have been
incorporated herein. No letter, telegram, or communication passing
between the parties hereto covering any matter during this contract
period, or any plans or periods thereafter, shall be deemed as part of
this Agreement and shall not have the effect of modifying or adding to
this Agreement unless it is distinctly stated in such letter, telegram,
or communication to this Agreement and is signed by the parties to this
Agreement.
10. Governing Law. This Agreement shall be governed by and interpreted in
accordance with the laws of the state of Pennsylvania.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
USA TECHNOLOGIES, INC.
/s/ Xxxxxx X. Xxxxxx, Xx. /s/ Xxx X. Xxxxxx
By:---------------------------------- ------------------------
Xxxxxx X. Xxxxxx, Xx. Xxx X. Xxxxxx
Chairman & CEO President
X.X. Xxxxxx Group, Inc.
Rev. 7/99
