Rubin Investment Group
Investment Banking Agreement
This Investment Banking Agreement dated as of August 19, 2003, by and between
Rubin Investment Group, Inc. ("RIG") with a principal place of business at 10940
Wilshire Blvd., 16th Floor, Los Angeles, California 90024, and The Classica
Group, Inc. (the "Company") with a principal place of business at 2400 Main
Street, Suite Number 12, Sayreville, New Jersey 08872.
W I T N E S S E T H:
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WHEREAS, the Company desires that RIG shall engage in services provided of the
Company for the period of one (1) year, August 19, 2003 to August 19, 2004/ RIG
is hereby engaged to provide merger and acquisition advisory and consulting
services in conjunction with the business and operations of the Company.
RIG will furnish to the Company a sixteen (16) page internal merger "evaluation
report" (upon completion of due diligence) which will include a detailed
financial analysis of the Company and its financial projections for the next
twelve months. The evaluation report will also provide a detailed description of
the company and industry, including comparables, and will state a proposed
valuation range which will be used for any corporate finance activities to be
needed by the Company.
Once a proposed transaction has been approved by the Company, a letter of intent
of the transaction will be provided.
NOW, THEREFORE, the parties hereto agree as follows:
1. Due diligence. RIG shall engage in due diligence of the Company, as it
deems appropriate. In order for RIG to conduct a thorough financial
analysis of the Company, the Company shall provide RIG with financial
information, including public filings and historical financial
statements, corporate business plans, sale contracts, customer lists,
letters of intent for acquisitions or other business activities as
well as use of proceeds if the Company is seeking capital in the form
of equity or debt financing. To analyze both the current and
historical trading activities of the Company, RIG will need to review
Depository Trust Company (DTC) Sheets, Shareholder Lists, Name of
Beneficial Owners (NOBO) lists and such other information reasonably
requested by RIG. This information will be used in conjunction with
the proposed equity valuation to determine a proposed valuation range
for any equity offerings.
2. Term. This Agreement shall be for a one (1) year period of time
necessary for RIG to conduct investment banking and other consulting
activities.
3. Compensation. As compensation to RIG for performing Investment
Banking, Advisory, Consulting services and Merger and Acquisition work
the Company shall give RIG and option to purchase one million two
hundred thousand shares (1,200,000) of the companies (TCGI) stock at a
purchase price of forty cents ($.40) per share upon execution of this
Agreement.
4. Independent Contractor. RIG is an independent contractor and not an
agent, servant or employee of the Company. RIG shall have no authority
to bind the Company.
5. Confidentiality. RIG agrees that it will not at anytime during the
term of this Agreement and at any time thereafter, disclose any
confidential knowledge or information regarding the Company to any
persons unless it receives the written consent of the Company to such
disclosure or the information ceases to be confidential by reason of
(i) its public disclosure by the Company (ii) its becoming generally
and publicly known, or (iii) it becomes known to RIG through a third
party who is not bound by any confidentiality agreement.
6. No Liability and Indemnification. The Company recognizes that RIG will
be using and relying upon data, materials and other information
furnished to it by the Company and its employees, auditors and
representatives and upon other information contained in reports and
statements relating to the Company, and the Company confirms that RIG
may rely on such data, material, and information provided by the
Company its employees, auditors and representatives without
independent verification and that RIG does not assume responsibility
for the truthfulness, accuracy or completeness of such information
whether or not RIG makes any independent verification.
In the absence of gross negligence, neither RIG nor any associate,
officer, director or stockholder of RIG shall be subject to any
liability to the Company or to any officer, employee, director or
stockholder of the Company, for any act or omission in the course of,
or in connection with, or for any error, inaccuracy or omission,
material or otherwise, which may appear in any review document or
other information furnished to or on behalf of the Company.
The Company agrees to indemnify and hold RIG and it associates,
officers, employees, affiliates, directors and stockholders harmless
from and against any and all losses, claims, damages or liabilities,
joint or several, to which RIG may become subject to in connection
with the transaction referred to herein, under any other statute, at
common law or otherwise, and to reimburse RIG for any legal or other
expense (including the cost of any investigation and preparation)
reasonably incurred by RIG arising out of or in connection with any
action or claim in connection therewith whether or not resulting
in any liability; provided, however, that the Company shall not be
liable in any such case to the extent that such losses, claim,
damage or liability is found in a final judgement by a court to have
been resulted from RIG gross negligence.
In the event that any action, suit, or proceeding is brought against
RIG in respect to which indemnity may be sought against the Company
pursuant to this Agreement, RIG shall, if a claim in respect thereof
is to be made against the Company under this Agreement, promptly
notify the Company in writing of the institution of such action, suit
or proceeding, and the Company shall be entitled to assume the defense
of such action, suit or proceeding, including the employment of
counsel satisfactory to RIG and the payment of expenses in connection
with such action, suit of proceeding. RIG shall have the right to
employ its own counsel in any such case, the fees and expenses of such
counsel shall have been authorized in writing by the Company, or the
Company shall have failed in it obligation to employ counsel to take
charge of such defense, or the use of joint counsel presents, in the
opinion of counsel of such counsel, such counsel from adequately
representing the interests of each of the Company and RIG, in any of
which events such reasonable fees and expenses of counsel employed by
RIG shall also be borne by the Company.
If for any reason the foregoing indemnification is unavailable to RIG
or insufficient to hold it harmless, then the Company shall contribute
to the amount paid or payable by RIG as a result of such loss, claim,
damage or liability in such proportion as is appropriate to reflect
nor only the relative benefits recovered by the Company, its
shareholders and/or its affiliates on the one hand and RIG on the
other but also the relative fault of the Company and RIG, as well as
any relevant equitable consideration. The obligations of RIG hereunder
are intended solely for the benefit of the Company and RIG shall not
have any obligation hereunder to any parties other than the Company.
7. Non-disclosure. No person or entity, other than the Company, shall be
entitled to make use of or rely upon the advice, services or materials
rendered or prepared by RIG hereunder and the Company shall not
directly or indirectly disseminate, distribute or otherwise make
available any advice, services or material prepared by RIG without
prior RIG consent.
8. Miscellaneous. This Agreement embodies the entire agreement and
understanding of the parties hereto and supercedes all prior
agreements and understanding written or oral, relating to the subject
matter hereof, and may not be modified or amended or any of its terms
or provisions waived or discharged, except in writing, signed by the
party against whom such modification, waiver or discharge is sought to
be enforced. This Agreement is not assignable without the prior
written consent of the other party.
Each of RIG and the Company represent: that this Agreement has in all
respects been duly authorized, executed and delivered by and on behalf
of itself. The covenants of the Company contained in the paragraphs
under the headings "No Liability and Indemnification" and
"Non-Disclosure" shall survive expiration of the term. During the
term, RIG shall be free to consult and conduct business with others,
including competitors of the Company and to engage in activities
similar to those contemplated hereunder whether for its own account or
for the account of others. All RIG and its obligations in connection
herewith shall be interpreted, construed and enforced in accordance
with and governed by the applicable laws of the State of California.
RIG and the Company consent to the jurisdiction of the Federal and
State courts located in Los Angeles, California for the commencement
of any action arising out of this Agreement
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the day
and dated first written.
Rubin Investment Group, Inc.
By: /s/ Dan Rubin
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Dan Rubin
Chief Executive Officer
The Classica Group, Inc.
By: /s/ Scott Halperin
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Scott Halperin
Chairman & CEO