ACTION STOCKS
Intelligent Sports, Inc.
AGREEMENT FOR SERVICES
WHEREAS Intelligent Sports, Inc. (the "Client"), desires to secure
fully reporting status with the Securities and Exchange Commission of the United
States and likewise secure public listing on OTC-BB;
WHEREAS the Company proposes that Action Stocks. Inc. ("ACTION STOCKS,
INC.") coordinate the process via the performance of certain services to include
corporate documentation and filing services for the client in conjunction with
public listing on OTC-BB(R) and the development of a Registration Statement for
the purposes of satisfying the Securities and Exchange Act(s) of 1933 and/or
1934, as amended, (and other applicable rules and regulations of the Securities
Exchange Commission or State Securities Divisions (Blue Sky Laws) thereunder
(collectively called the "Regulations"));
WHEREAS ACTION STOCKS, INC. desires to perform such services for the
Company;
THEREFORE, the parties hereto mutually covenant and agree as follows
1. Duties of ACTION STOCKS, INC.: ACTION STOCKS, INC. will cover all fees for
the provided services outlined below. These services include:
(a) "Transfer Agent"- assist the client in setting up account with proper
transfer agent. Assist in consulting the client with the issuance of stock to
shareholders.
(b) "SEC Registration Statement" - the coordination, compilation and/or
filing of documentation requisite to SB-2 registration with the SEC in
accordance with the provisions of the Act and likewise in accordance with the
rules and regulations promulgated by the relevant State Blue Sky laws.
(c) "SEC Comment Letter Support" - answer any and all comment 1etters from
the SEC incident to the filing of the Client's Registration Statement
(d) "Form 211 Development" - the compilation and preparation of Form 211 in
satisfaction of Rule 15(c)211 of the Exchange Act of 1934 to be filed with the
NASD, by the appropriate licensed market maker of ACTION STOCKS, INC., as the
original application for listing of the securities of the Client on the
OTC-BB(R). Included under this subparagraph are the following documents and
services;
(1) Form 211 Disclosure Document;
(2) Appropriate Exhibits;
(3) Application and Coordination Work with a Transfer Agent; and
(4) Financial Statement Audit Coordination.
1
ACTION STOCKS
(e) "Market Maker Introduction" - assist the Client with identifying appropriate
and duly licensed level three market makers, who may file the Client's Form 211
with the NASD for the listing of the Clients securities on the OTC-BB(R);
(f) "NASD Comment Letter Support" - assist the Client in answering any and
all comment letters from the NASD incident to the filing of the Client's Form
211 as outlined above;
(g) "Edgarizaton"- ACTION STOCKS, INC. will set up and file appropriate
forms with the client's ▇▇▇▇▇ ▇▇▇▇▇. ACTION STOCKS, INC. will cover all costs
associated with SEC filings.
(h) "Market Support"- Once publicly traded ACTION STOCKS, INC. will be
engaged to provide their standard six month promotional campaign.
(i) "Consulting Agreement"- ACTION STOCKS, INC will file an initial S-8
Registration for the Client to be filed once publicly traded.
2. Optional Services: "Standard & Poors - Market Access Service" - the
preparation of the initial application and subsequent follow up (i.e. point of
contact) to have the Client listed with Standard & Poor's Corporation Records
("S&P") to enable the Client's shareholders to qualify for the Blue Sky Manual
Exemption in up to thirty-eight states for all non-issuer transactions. ACTION
STOCKS, INC. will also oversee the filing of such state non-issuer exemption
notice filings upon listing in S&P. Fees for any optional services shall be
agreed by the parties prior to the commencement of such services.
3. Client to Provide Information: Client agrees to provide ACTION STOCKS, INC.
with any information and documents as may be requested by ACTION STOCKS, INC. in
connection with the services to be performed for Client. Client shall provide
ACTION STOCKS, INC. with an overnight express or similar account number (FedEx,
AirBorne Express, UPS, DHL, etc. ..) which will be used by ACTION STOCKS, INC.
when sending any documentation related to Client's contract ACTION STOCKS, INC.
(see other expenses). Client shall be solely responsible for the accuracy of the
information and representations contained in any documents to be prepared by
ACTION STOCKS, INC. on behalf of Client. Any filings which receive "deficiency"
or "comment" notices from a regulatory agency due to insufficient, incorrect or
conflicting information or otherwise requiring further clarification, shall be
forwarded to ACTION STOCKS, INC. and shall be addressed in conjunction with the
additional information or assistance provided by the client. Additionally, all
required documents, which inc1udes audited financial statements of the Client,
must be furnished to ACTION STOCKS, INC. by the Client in a timely fashion when
required as a part of the services to be provided to the Client by ACTION
STOCKS, INC. pursuant to the terms of this Agreement.
4. Compensation: Client shall provide $50,000 USD) and 13% equity of common
stock of the Client - whuch shall be registered in the SB-2 filing - as
compensation to ACTION STOCKS, INC. for the services provided and described
herein. ACTION STOCKS, INC.'s compensation shall consist of and be disbursed as
follows;
(A) Client disburses and ACTION STOCKS, INC. collects payment of
$25,000 USD upon the execution of this Agreement;
2
ACTION STOCKS
(B) Client disburses and ACTION STOCKS, INC. collects 13% equity of
common stock of the Client - which shall be registered in the
SB-2 filing;
(C) Client disburses and ACTION STOCKS, INC. collects payment of an
additional $25,000 USD upon the completion SB-2 Registration but
prior to submission of Form 211.
5. Timely review by client; The Client hereby ackowledges that part and
parcel of the public listing process mandates a prudent and timely review of
documentation on its part. The client warrants that it shall take reasonably
steps necessary to expeditiously review and authorization any and all
documentation submitted to it by ACTION STOCKS, INC. and ACTION STOCKS, INC.
shall not responsible for any delays caused directly or indirectly by the
client. Likewise, ACTION STOCKS, INC. is not responsible for any delays which
may arise as a result of pendency before regulatory authorities including the
SEC, the NASD, or State regulatory authorities. ACTION STOCKS, INC. assumes no
responsibility for any occurrences beyond its control, including but not limited
to federal or state filing backlogs or agency computer breakdowns, which may
result in processing delays. ACTION STOCKS, INC. will use its best efforts to
secure registration for Client but cannot guarantee that any registration will
be granted; however, in the event that the failure to obtain a registration is
directly attributable to an error or oversight on the part of ACTION STOCKS,
INC., ACTION STOCKS, INC. will use its best efforts to resolve the problem at no
additional expense to Client, In no event will ACTION STOCKS, INC be liable for
actual, incidental, consequential, related or any other type of damages, in any
amount, attributable to such error or oversight on the part of the Client.
6. Representations and Warranties of the Company. The Company represents
and warrants to ACTION STOCKS, INC. that;
(A) When any documentation pertaining to the Client Company is drafted and
finalized and at all times subsequent thereto up to and including the
termination of this Agreement, the documentation and any amendments thereto
will comply in all material respects with the provisions of the Act (and
the Rules and Regulations) (as promulgated by state and/or federal
regulatory authorities) and will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, and the
documents supplied to ACTION STOCKS, INC. by the Company - and any
supplements thereto will not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(B) It is expressly understood and expected by both parties and expressly
warranted by the Company that any documentation which preparation
facilitated by ACTION STOCKS, INC. or any documentation filed by ACTION
STOCKS, INC. and referred to herein, shall be reviewed by the Company or
its appointees of sufficient competence for any material deficiencies in
such a manner as to ensure accuracy and full and fair disclosure. The
Company warrants that it shall take prudent steps necessary to ensure that
any such documentation contain no material misrepresentatons or omissions
and hereby acknowledges that ACTION STOCKS, INC. is not responsible for
ensuring the accuracy or sufficiency of any documentation or disclosures
therein.
3
ACTION STOCKS
(C) The Securities of the Company conform - in all material respects - to the
description thereof contained in the relevant documentation provided by the
Client.
(D) There is no material litigation or governmental proceeding pending, to
which the Company (or any subsidiary) is a party or of which any of its
property is the subject, and, to the best of the Company's knowledge, no
such proceeding is threatened or contemplated. No contract or document of a
character required to be described in any formal filing is not so described
or filed as required.
(E) This Agreement has been duly authorized, executed and delivered on behalf
of the Company and is a valid and binding obligation of the Company, except
as rights to indemnify and contribution hereunder may be limited under
applicable law.
(F) No stop order suspending the effectiveness of the efforts anticipated by
this Agreement has been issued no proceedings for that purpose have been
taken or are pending or, to the knowledge of the Company, threatened by the
Commission.
(G) The Company has good and marketable title to all properties and assets
described in the documentation as owned by it, free and clear of all
security interests, liens, charges, encumbrances or restrictions, except
such as are described or referred to in the documentation or are not
materially significant or important in relation to the business of the
Company, and its subsidiaries, taken as a whole, except as described in the
documentation.
(H) Indemnification and Contribution. (a) The Company agrees to indemnify and
held harmless ACTION STOCKS, INC., its officers and directors, and each
person, if any, who controls ACTION STOCKS, INC. within the meaning of
either Section 15 of the Act or Section 20 of the Securities Exchange Act
of 1934, and any agents or employees of ACTION STOCKS, INC, from and
against any and all losses, claims, damages, and liabilities caused by any
untrue written statement or a1leged untrue written statement of a material
fact, provided by the Company, contained in any formal filing or offering
document or supplemental documentation caused by 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, or caused by
virtue of any willful conduct of the Company in violation of this Agreement
or any willful failure to comply with fed and/or state securities rules and
regulations. Such indemnification includes any and all costs incident to
such legal claims as may be made against ACTION STOCKS, INC. from any claim
arising from the scope of the activities contemplated in this Agreement.
(I) Indemnification and Contribution. (a) ACTION STOCKS, INC. agrees to
indemnify and hold harmless the Company, its officers and directors, and
each person, if any, who controls the Company within the meaning of either
Section 15 of the Act or Section 20 of the Securities Exchange Act of 1934,
and any agents or employees of the Company, from and against any and all
losses, claims, damages, and liabilities caused by any untrue written
statements or alleged untrue written statement of a material fact, provided
by ACTION STOCKS, INC., contained in any formal filing or offering document
or supplemental documentation caused by any omission or alleged
4
ACTION STOCKS
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or caused by
virtue of any willful conduct of ACTION STOCKS, INC. in violation of this
Agreement or any willful failure to comply with federal and/or state
securities rules and regulations. Such indemnification includes any and all
costs incident to such legal claims as may be made against the Company from
any claim arising from the scope of the activities contemplated in this
Agreement.
7. Independent Contractor Status: ACTION STOCKS, INC. shall perform its services
under this contract as an independent contractor and not as an employee of
Client or an affiliate thereof. It is expressly understood and agreed to by the
parties hereto that ACTION STOCKS, INC. shall have no authority to act for, or
represent or bind Client or any affiliate thereof in any manner, except as
provided for expressly in this Agreement or in writing by Client.
8. Late Fees: Any ACTION STOCKS, INC. invoice not paid within thirty (30) days
of such billing is subject to a 1.5% monthly interest charge. ACTION STOCKS,
INC. reserves the right to use any and all means of collection available under
applicable law to collect any amount past due.
9. Amendment and Modification: Subject to applicable law, this Agreement may be
amended, modified or supplemented only by a written agreement signed by both
parties. No oral modifications to this Agreement may be made.
10. Entire Agreement: This Agregment contains the entire understanding between
and among the parties and supersedes any prior understandings and agreements
among them respecting the subject matter of this Agreement. The failure by
ACTION STOCKS, INC. to insist on strict performance of any term or condition
contained in this Agreement shall not be construed by Client as a waiver, at any
time, of any rights, remedies or indemnifications, all of which shall remain in
full force and effect from time of execution through eternity.
11. Binding Effect: This Agreement shall be binding upon the heirs, executors,
administrators, successors and permitted assigns of the parties hereto. Client
shall not assign its rights or delegate its duties under any term or condition
set forth in this Agreement without the prior written consent of ACTION STOCKS,
INC..
12. Attorney's Fees: In the event an arbitration, mediation, suit or action is
brought by any party under this Agreement to enforce any of its terms, or in any
appeal therefrom, it is agreed that the prevailing party shall be entitled to
reasonable attorneys fees to be fixed by the arbitrator, mediator, trial court
and/or appellate court.
13. Severability: If any provision of this Agreement is held to be illegal,
invalid or unenforceable under present or future laws effective during the term
hereof, such provision shall be fully severable this Agreement shall be
construed and enforced as if such illegal, invalid or unenforceable provision
never comprised a part hereof and the remaining provisions hereof shall remain
in full force and effect and shall not be affected by the illegal, invalid or
unenforceable provision or by its severance herefrom. Furthermore, in lieu of
such illegal, invalid and unenforceable provision, there shall be added
automatically as part of this Agreement a provision as similar in nature in its
terms to such illegal, invalid or unenforceable provision as may be legal, valid
and enforceable,
5
ACTION STOCKS
14. Governing Law: This Agreement shall be governed by the laws of the State of
California and the venue for the resolution of any dispute arising thereof shall
be in San Diego, State of California.
15. Legal Counsel: Client further agrees and understands that although documents
and filings may be compiled or filed by ACTION STOCKS, INC., ACTION STOCKS, INC.
has not and does not render legal advice or offer legal assistance. All requests
for legal advice by clients of ACTION STOCKS, INC. will be referred to
apprpriate legal counsel for the Client as retained by the client for a proper
legal opinion. Accordingly, no statements or representations by ACTION STOCKS,
INC. should be construed to be legal advice of counsel, and ACTION STOCKS, INC.
advises Client to consult with its own counsel regarding the sufficiency of
disclosures and/or compliance with applicable rules and regulations.
16. Broker-Dealer/Underwriter Client acknowledges that ACTION STOCKS, INC. is
not a broker-dealer or underwriter and does not provide services directly or
indirectly related to the offering, issuance or sale of securities, ACTION
STOCKS, INC., pursuant to this Agreement, is charged with assisting the client
in compiling requisite information and documentation in such a manner as to
facilitate the services rendered by duly licensed broker dealers and/or
competent legal counsel and to further assist the client in filing such
documentation as necessary. Finally, ACTION STOCKS, INC. is responsible for
coordinating the activities contemplated herein in an expeditious, efficient
manner for the benefit of the client and its anticipated endeavors as outline
herein. Any and all compensation rendered by ACTION STOCKS, INC. by virtue of
its performance of services delineated in this Agreement is entirely independent
of any securities related transaction(s) offerings, issuances, broker-dealer, or
legal related services which other parties anticipated to be involved in the
activities contemplated herein may engage. No commissions or transaction based
compensation derived from the sale of securities is payable to ACTION STOCKS,
INC., No broker-dealer or underwriter related services are to be performed by
ACTION STOCKS, INC. a such services are to be performed by the appropriate duly
licensed brokerage firm engaged by the Client to perform such services,
17. Post-Registration Responsibilities: Client understands and acknowledges by
the acceptance of this Agreement that all post-registration periodic or special
reports are the responsibility of the Client unless otherwise agreed to in
writing by ACTION STOCKS, INC..
18. Effective Date of Agreement and Termination. This Agreement shall become
effective upon execution by both parties and shall terminate one hundred eighty
(180) days from the effective date of this Argreement.
6
ACTION STOCKS
IN WITNESS THEREOF, the parties have caused this Agreement to be duly executed,
as of the day and year set out below.
Intelligent Sports, Inc.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇ 3/25/02
------------------------ -----------------
DATE
Action Stocks, Inc.
By: /s/ B illegible 3-26-02
------------------------ ------------------
DATE
7
