Annual Report — Small Business — Form 10-KSB
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10KSB Annual Report -- Small Business 38 212K
6: EX-10.10 Material Contract 7 34K
7: EX-10.11 Material Contract 69 237K
8: EX-10.12 Material Contract 26 97K
9: EX-10.13 Material Contract 55 176K
10: EX-10.14 Material Contract 17 65K
2: EX-10.6 Material Contract 4 14K
3: EX-10.7 Material Contract 2 10K
4: EX-10.8 Material Contract 5 18K
5: EX-10.9 Material Contract 9 44K
11: EX-21.1 Subsidiaries of the Registrant 1 6K
12: EX-27.1 Financial Data Schedule (Pre-XBRL) 2 7K
EX-10.6 — Material Contract
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Exhibit 10.6
ATLANTIS EQUITIES, INC.
750 Lexington Avenue
New York, New York 10022
Tel: (212) 750-5858
Fax: (212)750-6667
October 29, 1999
Cakewalk LLC
250 W. 57 St.
Suite 620
New York, N.Y. 10107
Attn: Robert Miller, President and CEO
Re: Engagement Letter
Dear Robert:
Atlantis Equities, Inc., including its affiliated entities (collectively,
"Atlantis"), proposes to establish a comprehensive merchant banking and advisory
relationship with the Combined Company (as hereinafter defined), for the purpose
of assisting the Combined Company in implementing its business strategy.
Prior hereto, Atlantis introduced Cakewalk LLC, one of the country's
leading independent music companies ("Cakewalk"), to CDbeat.com, Inc., a leading
Internet music technology company ("CDbeat"), for the purpose of effectuating a
business combination between the two companies. On September 28, 1999, Atlantis
acquired a warrant to purchase 80% of CDbeat's equity for $1 million. Also on
September 28, 1999, Cakewalk and CDbeat signed (a) a letter of intent calling
for a merger of the two companies (the "Letter"), and (b) a loan agreement
pursuant to which Cakewalk loaned CDbeat $50,000 for working capital purposes
pending the merger. For tax purposes, the transaction is being structured as an
acquisition of Cakewalk's assets by CDbeat, and Atlantis's investment will be
made through Cakewalk. As used herein, the term "Combined Company" will refer to
the combination of Cakewalk and CDbeat.
Upon consummation of the transaction, Atlantis and/or its associates will
own 40% of the Combined Company's equity. Robert Miller, President and CEO of
Cakewalk, will become President and CEO of the Combined Company. It is
contemplated that definitive documentation between the two companies and
Atlantis will be executed imminently or concurrently with this engagement
letter.
Based upon the foregoing, and assuming the consummation of the transaction
between Cakewalk and CDbeat forming the Combined Company, the parties agree that
the Combined Company shall engage Atlantis as its exclusive financial advisor.
In such capacity, Atlantis shall perform the following services:
1. M&A. Atlantis will introduce the Combined Company to potential
acquisition candidates, will assist the Combined Company in the due diligence,
structuring and implementation phases of the acquisition process, and will
assist in monitoring acquired portfolio companies.
2. Consulting. Atlantis will consult with the Combined Company as to its
business plans, management, and capital structure.
3. Senior Management. Atlantis will assist the Combined Company in
locating and recruiting qualified senior management personnel, including a COO,
CTO and CEO with appropriate experience. Atlantis will also assist the Combined
Company in locating several qualified members for its Advisory Board.
4. Other Services. Atlantis shall provide additional advisory,
consultation and related services to the Combined Company as requested by the
Company.
In consideration of the foregoing services, the Combined Company shall pay
Atlantis a monthly cash consulting fee of $12,500, plus reimbursement of
reasonable and actual out-of-pocket expenses, including attorneys' fees, in
connection with Atlantis' investment in CDBeat, including filing of Schedules
130 and Forms 3 and 4, and negotiation of warrants, membership subscription and
related documents. All monthly expenses over $1,500 will require the prior
approval of the Combined Company, provided that it is acknowledged that the
expenses incurred prior to the date hereof exceed $1,500 and such expenses are
hereby approved. Atlantis shall also receive $50,000 at the closing.
The Combined Company shall indemnify Atlantis in accordance with the
indemnification provisions attached hereto as Schedule II, which provisions are
incorporated herein by reference.
2
The term of this engagement letter shall be for three (3) years from and
after the effective date hereof, and shall automatically renew for successive
one (1) year terms, subject to the right of any party to terminate the
engagement upon written notice to the other party no less than ninety (90) days
prior to the end of any such term.
In consideration of the foregoing, and as Cakewalk's advisor and the
beneficial holder of a controlling interest in CDbeat, Atlantis agrees to
support the combination of CDbeat and Cakewalk, and further agrees not to
support or vote for a merger, combination or any similar transaction involving
CDbeat with any other party, nor to introduce any other party to CDbeat for
purposes of a merger, combination or any similar transaction; provided, however,
that Cakewalk's Supervisory Board approves the merger transaction. The
provisions of this paragraph shall terminate if the Contribution Agreement,
dated as of even date herewith, is terminated in accordance with its terms.
[Balance of page intentionally left blank]
3
If the foregoing accurately reflects our understanding, kindly sign below
and fax back a copy of this letter to the undersigned.
Sincerely yours,
Nancy Ellin,
Chairman
ACCEPTED AND AGREED TO:
CAKEWALK LLC, ON HALF OF
THE COMBINED COMPANY
/s/ Robert Miller
------------------------------
Robert Miller, President & CEO
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
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| This ‘10KSB’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| | 4/17/00 |
| Filed on: | | 4/14/00 |
| For Period End: | | 12/31/99 | | | | | | | NT 10-K |
| | 10/29/99 | | 1 |
| | 9/28/99 | | 1 |
| List all Filings |
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