TELENETICS
Your Communications Partner (TM) www.telenetics.com
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December 10, 1999
Mr. Stanley C. Brooks
Mr. William Garland
Brookstreet Securities Corporation
Northridge, CA 91324
The purpose of this letter is to confirm the engagement of Brookstreet
Securities Corporation ("Brookstreet") by Telenetics Corporation (the "Company")
on a non-exclusive basis to render financial advisory and investment banking
services to the Company.
1. ENGAGEMENT OF CONSULTANT. The Company hereby engages Brookstreet and
Brookstreet hereby agrees to render services to the Company as a corporate
finance consultant.
2. SERVICES. During the term of this Agreement, Brookstreet shall
provide advice to, and consult with, the Company concerning business and
financial planning, corporate organization and structure, financial matters in
connection with the operation of the business of the Company, private and public
equity and debt financing, acquisitions, mergers and other similar business
combinations, the Company's relations with its securities holders, the
preparation and distribution of periodic reports, and analysis of the Company's
financial statements. Such advice and consultation are herein after referred to
as "Financial Services". The Financial Services shall be provided to the Company
in such form, manner and place as the Company reasonably requests. Although no
minimum number of hours shall be required for any particular period, it is
expected that approximately ten (10) hours per month will be devoted by
Brookstreet to providing Financial Services to the Company. Such Financial
Services will be provided by Brookstreet through Mr. Brooks, Mr. Garland or
persons directed by them or others who are acceptable to the Company.
Brookstreet shall not by this Agreement be prevented or barred from rendering
services of the same or similar nature, or on behalf of, persons, firms or
corporations other than the Company. Similarly, the Company shall not be
prevented or barred from seeking or requiring services of a same or similar
nature from persons other than Brookstreet.
3. TERM. The term of this Agreement shall be a period commencing
effective January 1, 2000 and continuing through December 31, 2001, unless
earlier terminated as provided below.
4. COMPENSATION. As compensation for Financial Services, the Company
shall:
(a) pay a monthly fee of $2,500.00, payable the first day of
each month.
(b) issue Brookstreet nonqualified stock options equivalent to
180,000 shares at the average market price at the time of grant of option,
vested equally every months during the term of this agreement.
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(c) reimburse Brookstreet for any authorized out-of-pocket
expense incurred by Brookstreet. Such payment shall be made within thirty (30)
days of submission of receipts by Brookstreet for such expenses. Authorization
for such expenses shall be based upon prior written consent by the Company
(i.e., prior to such expenses being incurred).
5. UNFAIR COMPETITION: PROPRIETARY INFORMATION. During the term of this
Agreement, Brookstreet may have access to certain trade secrets and/or
proprietary information of the Company. During the term of this Agreement and
thereafter, Brookstreet shall not disclose, divulge, sell or give to any third
party (except to the specific benefit of and at the written direction of the
Company) any such proprietary information or trade secrets. All records, files,
drawings, documents, computer programs, equipment and the like relating to the
Company's business which Brookstreet shall use, prepare or have access to, shall
remain the sole property of the Company, and the privacy of the Company shall be
protected by Brookstreet. These restrictions shall not apply to any information
which shall be made available by the Company to the public.
6. TERMINATION. This agreement may be terminated by the Company at any
time by notice to the other party, if: (a) Brookstreet ceases business
operations, dissolves or is otherwise unable to provide Financial Services; or
(b) Brookstreet breaches this agreement.
7. WAIVER. Any of the terms and conditions of this Agreement may be
waived at any time and from time to time in writing by the party entitled to the
benefit thereof, but a waiver in one instance shall not be deemed to constitute
a waiver in any other instance. A failure to enforce any provision of this
Agreement shall not operate as a waiver of this provision or of any other
provision hereof
8. AMENDMENT. No amendment to this Agreement shall be valid unless such
amendment is in writing and is signed by authorized representatives of both of
the parties to this Agreement.
9. SEVERABILITY. In the event that any provision of this Agreement
shall be held to be invalid or unenforceable in any circumstances, the remaining
provision shall nevertheless remain in full force and effect and shall be
construed as if the unenforceable portion or portions were deleted.
10. ASSIGNMENT. This Agreement shall be binding upon and inure to the
benefit of the parties and their respective successors and permitted assigns.
Any attempt by either party to assign any rights, any rights, duties or
obligations which may arise undr this Agreement without the prior written
consent of the other parties shall be void.
11. GOVERNING LAW. The validity, interpretation and construction of
this Agreement and each part thereof will be governed by the laws of the sate of
California.
12. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which may be deemed an original and all of which together
will constitute one and the same instrument.
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13. NOTICES. Any notice pursuant to this Agreement by the Company or by
Brookstreet shall be in writing and shall be deemed to have been duly given if
delivered or mailed by certified mail, return receipt requested, to the
addresses of the parties set forth below their signatures to this Agreement, or
as may be updated pursuant to this provision.
14. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter hereof and
supersedes any and all prior agreements, understandings and representations,
whether written or oral.
This Agreement is made to be effective January 1, 2000. If this is
satisfactory, please sign and return one copy to us.
TELENETICS CORPORATION
By: /S/ MICHAEL ARMANI
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Michael A. Armani
President and CEO
AGREED AND ACCEPTED;
BROOKSTREET SECURITIES CORP.
By: /S/ STANLEY C. BROOKS
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Stanley C. Brooks, President
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