Document:

Exhibit 4.17

 

PUBLIC RELATIONS
AGREEMENT

BETWEEN LIOLIOS GROUP,
INC. AND

SPESCOM SOFTWARE INC.

 

THIS FINANCIAL PUBLIC RELATIONS AGREEMENT (“Agreement”) is made and
entered into this 15th day of November, 2005 (the “Effective Date”) by and
between Spescom Software
Inc., a California Corporation (“Company”) and Liolios Group, Inc., a
California Corporation (“Consultant”).

RECITALS

 

Company desires to engage
Consultant to perform certain financial public relations services for it, and
Consultant desires, subject to the terms and conditions of this Agreement, to
perform financial public relations services for Company.

 

NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL PROMISES AND UNDERTAKING
HEREIN CONTAINED AND FOR OTHER GOOD AND VALUABLE CONSIDERATION THE RECEIPT AND
SUFFICIENCY OF WHICH IS HEREBY ACKNOWLEDGED THE PARTIES AGREE AS FOLLOWS:

 

1.             ENGAGEMENT OF CONSULTANT

 

Company hereby engages Consultant and Consultant
hereby agrees to hold itself available to render, and to render at the request
of the Company, independent advisory and consulting services for the Company,
upon the terms and conditions hereinafter set forth. Such consulting services
shall include the development, implementation and maintenance of an on-going
stock market support system that increases broker awareness of the company’s
activities and stimulates investor interest in the Company. The stock market
support system shall include a Shareholder Communication System, and Media
Relation Systems, which will be defined and developed by Consultant. It is
understood that Consultant’s ability to relate information regarding the
Company’s activities is directly proportionate to and contingent upon
information availed by the Company to the Consultant. Although Consultant will
pass along information about the Company or its assets to brokers, it
undertakes no responsibility to independently corroborate any information. The
Company shall include in any documents or materials prepared by or with the
help of Consultant that no party may rely on any representations purportedly
made by Consultant, or on its involvement with the Company, in making its
decision to invest.

 

2.            TERM

 

The term of this Agreement (“Term”) shall begin as of
the Effective Date and shall terminate six (6) months thereafter. Following the
six (6) month term, the engagement shall continue on a month-to-month basis
under the identical monthly compensation, unless terminated in accordance with
the provisions of this Agreement.

 

 

3.            COMPENSATION

 

a)     As
compensation for the services rendered by the Consultant under this Agreement,
Company agrees to pay to Consultant at a rate of $6,000 per month. This is in
addition to reimbursement of reasonable expenses, which may include but not
limited to: press releases, investor conference calls, web-casts, fax
broadcasts, road-shows and out-of-pocket travel expenses. All reimbursable
expenses greater than $500 shall be pre-approved by the Company.

 

b)    Further
as compensation to the consultant for services rendered pursuit to this
agreement, every month the agreement is effective the Company shall issue a
warrant (collectively, the “Warrants”) to purchase up to 50,000 shares the
Stock. The Warrants vest as of the Effective Date, and are exercisable at a
price of $0.10 per share of Stock.

 

c)     Further
as compensation to the consultant for services rendered pursuit to this
agreement, Company shall issue a one-time performance warrant (collectively,
the “Performance Warrants”) to purchase up to 500,000 shares the Stock. The
Warrants are exercisable at a price of $0.25 per share of Stock, and are
subject to the following vesting schedule.

 

1.     The
Performance Warrant to purchase 500,000 shares at $0.25 per share shall vest if
during the term of this agreement the volume weighted average price of the Company
common stock is above $0.50 for five (5) consecutive days.

 

The Warrants shall have a term of three (3) years from
the date of issuance and include standard “piggy-back” registration rights. A
warrant certificate shall be issued for Warrants earned as they become vested.

 

4.            CASHLESS EXERCISE

 

Consultant is granted “Cashless Exercise Rights”,
whereby if notice of exercise by Consultant specifies that the exercise of this
Warrant is made pursuant to Section 4, then the Company shall deliver to
consultant, without payment by Consultant of any Exercise Price or any cash or
other consideration, the number of Company Shares computed using the following
formula:

 

	
   

  	
  X =

  	
  Y(A-B)

  
	
   

  	
   

  	
      A

  
	
   

  	
   

  	
   

  
	
  Where:

  	
   

  	
   

  
	
   

  	
  X =

  	
  the number of Warrant Shares to be issued to the
  Consultant pursuant to the exercise of this Warrant pursuant to this Section
  4;

  
	
   

  	
   

  	
   

  
	
   

  	
  Y =

  	
  the number of Shares that may be purchased upon
  exercise of this Warrant;

  
	
   

  	
   

  	
   

  
	
   

  	
  A =

  	
  the Market Price, as defined below, of one share of
  Common Stock; and

  
	
   

  	
   

  	
   

  
	
   

  	
  B =

  	
  the Exercise Price per share of Common Stock.

  

 

 

“Market Price” of an security means the average of the
closing prices of such security’s sales on all securities exchanges on which
such security may at the time be listed on the 5  trading days prior to the date of exercise,
or, if there has been no sales on any such exchanges on any day, the average of
the highest bid and the lowest asked prices on all such exchanges at the end of
such day, or, if on a day any such security is not listed, the average of the
representative bid and asked prices quoted in the NASDAQ System as of 4:00pm
Eastern Time.

 

5.             INDEPENDENT CONTRACTOR

 

It is expressly agreed that the Consultant is acting
as an independent contractor in performing its services hereunder.  Company shall carry no workmen’s compensation
insurance or any health or accident insurance to cover Consultant.  Company shall not pay any contributions to
social security, unemployment insurance, Federal or state withholding taxes nor
provide any other contributions or benefits which might be expected in an
employer-employee relationship.

 

6.                                      ASSIGNMENT

 

This Agreement is a
personal one being entered into in reliance upon and in consideration of the
singular personal skills and qualifications of Consultant.  Consultant shall therefore not voluntarily or
by operation of law assign or otherwise transfer the obligations incurred on
its part pursuant to the terms of this Agreement without the prior written
consent of the Company.  Any attempt at
assignment to transfer by Consultant of its obligation with out such consent
shall be wholly void.

 

7.             CONFIDENTIAL INFORMATION

 

7.1           The
term “Confidential Information” shall mean information designated as
Confidential Information by Company.  “Confidential
Information” may include, but not be limited to, information regarding Company’s
business, plans, customers, technology, and/or products that is confidential
and of substantial value to Company, which value would be impaired if such
information were disclosed to third parties.  
Company’s Confidential Information shall also include any and all
non-public information, which is related to Company’s technology.

 

 

7.2           Notwithstanding
the foregoing, Confidential Information shall not include information which (i)
is or becomes a part of the public domain through no act or omission of the
receiving party; or (ii) was in the receiving party’s lawful possession prior
to the disclosure and had not been obtained by the receiving party either
directly or indirectly from the disclosing party; or (iii) is lawfully
disclosed to the receiving party by a third party without restriction on
disclosure; or (iv) is independently developed by the receiving party; or (v)
is required to be disclosed by law provided that the disclosing party has had
seven (7) days to respond to the request.

 

7.3           Consultant
agrees, both during the term of this Agreement and for a period of two years
thereafter, to hold Company’s Confidential Information in confidence, and
agrees not to make such Confidential Information available in any form to any
third party, or use such Confidential Information for any other purpose than
the implementation of this Agreement. 
Consultant agrees to take all reasonable steps to ensure that Company’s
Confidential Information is not disclosed or distributed by its employees or
agents in violation of the provisions of this Agreement.  Termination of the Agreement shall not
relieve Consultant of its obligations under this Section 6.

 

8.             TERMINATION

 

This Agreement may be terminated by either party for
any reason upon thirty-days (30) notice in writing following the six month (6)
month anniversary.  In the event the
Agreement is terminated, Consultant shall cease rendering its services to
Company as of the effective date of termination, and Company shall pay
Consultant for the services performed and approved expenses through the later
of the Effective Date or the effective date of termination. Any materials
created for the Company shall be delivered to Company within ten (10) days of
the date of termination.

 

9.             PUBLIC ANNOUNCEMENTS 

 

Upon any completed Transaction, Consultant shall have
the right to place announcements and advertisements in financial and other
newspapers, journals and mailings, at its own expense, describing its services
in connection with the Transaction.

 

 

10.           INDEMNIFICATION; EXCULPATION

 

Recognizing that Consultant, in providing the services
contemplated hereby, will be acting as representative of and relying on
information provided by the Company, the Company agrees to the provision of
Schedule I hereto.  The Company shall use
its best efforts to cause any binding agreements with acquirers or providers of
capital or financing to include exculpation and indemnification provisions in
favor of Consultant which are equivalent to the foregoing and are binding on
such persons.  It is specifically
understood and agreed that the indemnification provisions of Schedule I shall
be binding on the successors and assigns of the parties hereto and of the
Indemnified parties, specifically including the continuing entity after any
Transaction and any successor thereto whether by subsequent merger,
consolidation or transfer of all or a substantial part of the assets or
business of the Company or such continuing entity.

 

11.           GENERAL PROVISIONS

 

11.1        Governing
Law and Jurisdiction

 

This Agreement shall be governed by and interpreted in
accordance with the laws of the State of California.  Each of the Parties hereto consents to such
jurisdiction for the enforcement of this Agreement and matters pertaining to
the transaction and activities contemplated hereby.

 

11.2        Non-Circumvention

 

Neither the Company nor its directors, officers,
agents attorneys, employees, affiliates, representatives, successors, or
assigns (collectively referred to as the “Company”) will attempt to consummate
a transaction (each, a “Transaction”) with any financing sources, or potential
acquisition (“Covered Parties”) introduced by the Consultant without first
notifying Consultant, and satisfying Consultant’s right to a 5% finders fee.
This provision will inure during the term of this Agreement and continue for a
period of one (1) year from the expiration or termination of this
Agreement.  Upon expiration or
termination of this Agreement Consultant will provide a written list of all
Covered Parties.  The Company shall keep
completely confidential the identity of all such financing parties. It is
understood that this Agreement is a reciprocal one between the signatories
concerning the privileged information and contacts.

 

 

11.3        Attorney’s
Fees

 

In the event a dispute arises with respect to this
Agreement, the party prevailing in such dispute shall be entitled to recover
all expenses, including, without limitation, reasonable attorney’s fees and
expenses incurred in ascertaining such party’s rights, in preparing to enforce
or in enforcing such party’s rights under this Agreement, whether or not it was
necessary for such party to institute suit. 
Further, in the event the Company, its officers, and or its directors
cause a dispute in which Consultant is involved, the Company agrees to hold
Consultant harmless, and provide reasonable attorney fees. Company further
agrees to notify Consultant immediately of such event.

 

11.4        Complete
Agreement

 

This Agreement supersedes
any and all of the other agreements, either oral or in writing, between the
Parties with respect to such subject matter in any manner whatsoever. Each
Party to this Agreement acknowledges that no representations, inducements,
promises or agreements, oral or otherwise, have been made by any Party, or
anyone herein, and that no other Agreement, statement or promise not contained
in the Agreement may be changed or amended only by an amendment in writing
signed by all of the Parties or their respective successors-in-interest.

 

11.5        Unenforceable
Terms

 

Any provision hereof prohibited by law or
unenforceable under the law of any jurisdiction in which such provision is
applicable shall adhere to such jurisdiction only be ineffective without
affecting any other provision if this Agreement.  To the full extent, however, that such
applicable law may by waived to the end that this Agreement be deemed to be a
valid and binding agreement enforceable in accordance with its terms, the
Parties hereto hereby waive such applicable law knowingly and understanding the
effect of such waiver.

 

11.6        Execution
in Counterparts

 

This Agreement may be executed in several counterparts
and when so executed shall constitute one agreement binding on all the Parties,
notwithstanding that all the Parties are not signatory to the original and same
counterpart.

 

 

11.7        Further
Assurances

 

From time to time each Party will execute and deliver
such further instruments and will take such other action as any other Party may
reasonably request in order to discharge and perform their obligations and
agreements hereunder and to give effect to the intentions expressed in this
Agreement.

 

11.8                        Incorporation
by Reference

 

All exhibits referred to in this Agreement are
incorporated herein in their entirety by such reference.

 

11.9        Miscellaneous
Provisions

 

The various headings and numbers herein and the grouping of provisions
of this Agreement into separate articles and paragraphs are for the purpose of
convenience only and shall not be considered a part hereof.  The language in all parts of this Agreement
shall in all cases be construed in accordance with its fair meanings as if
prepared by all Parties to the Agreement and not strictly for or against any of
the Parties.

 

12.           NOTICES

 

Any notice or other communication required or permitted hereunder shall
be in writing and shall be delivered personally, telegraphed, telexed, sent by
facsimile transmission (provided acknowledgement of receipt thereof is
delivered to the sender) or sent by certified, registered or express mail,
postage prepaid. Any such notice shall be deemed given when so delivered
personally, telegraphed, telexed, sent by facsimile transmission or, if mailed,
three days after the date of deposit in the United States mails as follows:

 

	
   

  	
  If to
  Consultant, to:

  
	
   

  	
   

  	
  Liolios Group, Inc.

  
	
   

  	
   

  	
  2431 West Coast Hwy, #202

  
	
   

  	
   

  	
  Newport Beach, CA. 92663

  
	
   

  	
   

  	
   

  
	
   

  	
  If to Company, to:

  
	
   

  	
   

  	
  Spescom Software, Inc.

  
	
   

  	
   

  	
  10052 Mesa Ridge Court, Suite 100

  
	
   

  	
   

  	
  San Diego, CA 92121

  
	
   

  	
   

  	
  858-625-3000

  

 

or such address as any of the above shall have
specified by notice hereunder.

 

 

IN WITNESS
WHEREOF, the Parties hereto have executed this Agreement as of the day and year
first hereinabove written.

 

	
   

  	
  Spescom
  Software, Inc.

  
	
   

  	
   

  
	
   

  	
  By:

  	
       /s/ John W. Low

  	
   

  
	
   

  	
  Name:

  	
  John W. Low

  
	
   

  	
  Title:

  	
  Chief Financial officer

  
	
   

  	
   

  
	
   

  	
  LIOLIOS GROUP, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
       /s/ J. Scott Liolios

  	
   

  
	
   

  	
  Name:

  	
  J. Scott Liolios

  
	
   

  	
  Title:

  	
  President

  
						

 

 

Schedule I (Indemnification)

 

This Schedule I is a part
of and is incorporated into that certain Financial Public Relations Agreement
(together, the “Agreement”) dated November 15, 2005, by and between the Company
and Consultant.  The Company agrees to
indemnify and hold harmless Consultant and its affiliates, the respective
directors, officers, attorneys, finders and other agents, stockholders and
employees of Consultant and its affiliates and each other person, if any,
controlling Consultant or any of its affiliates (Consultant and each such
person and entity being referred to as an “Indemnified Person”), to the full
extent lawful, from and against any losses, claims, damages, expenses or
liabilities or actions (including without limitation shareholder actions and
actions arising from the use of information contained in any Information
Materials or omissions from such materials) related to or arising out of this engagement
or Consultant’s role in connection herewith, and will pay (or, if paid by an
Indemnified Person, reimburse such Indemnified Person) for all fees and
expenses (including without limitation counsel fees and charges for the time of
Consultant professional employees at their then current hourly rates) incurred
by such Indemnified Person in connection with investigating, preparing or
defending any such action or claim, whether or not in connection with pending
or threatened litigation in which any Indemnified Person is a party.

 

The Company will not,
however, be responsible for any claims, liabilities, losses, damages or
expenses which result from any compromise or settlement not approved by the
Company or which are determined by a final judgment of a court of competent
jurisdiction to have resulted solely from the fraud, willful misconduct or
gross negligence of any Indemnified Person. The Company also agrees that no
Indemnified Person shall have any liability to the Company for or in connection
with this engagement, except for any such liability for losses, claims,
damages, liabilities or expenses incurred by the Company, which are determined
by a final judgment of a court of competent jurisdiction to have resulted
solely from the fraud, willful misconduct or gross negligence of the
Indemnified Person.  The foregoing
agreement shall be in addition to any rights that any Indemnified Person may
have at common law or otherwise, including without limitation any right to
contribution.

 

The Company’s agreement to
indemnify Consultant and other Indemnified Persons pursuant to this letter
shall not be disclosed publicly or made available to third parties by either
party hereto without the other party’s prior written consent.  If any action or proceeding is brought
against any Indemnified Person in respect of which indemnity may be sought
against the Company pursuant hereto, or if any Indemnified Person receives
notice from any potential litigant of a claim which such person reasonably
believes will result in the commencement of any such action, proceeding, or
claim, such Indemnified Person shall promptly notify the Company in writing of
the commencement of such action or proceeding, or of the existence of any such
claim, but the failure so to notify the Company of any such action or
proceeding shall not relieve the Company from any other obligation or liability
which it may have to any Indemnified Person otherwise than under this Agreement
or with respect to any other action or proceeding.  In case any such action or proceeding shall
be brought against any Indemnified Person with respect to which such
Indemnified Person gives notice of its intention to seek indemnification
hereunder, the Company shall be entitled to participate in such action or
proceeding and, to the extent that the Company may determine, to assume the
defense thereof, with counsel of the Company’s choice (in which case the
Company shall not thereafter be responsible for the fees and expenses of any
separate counsel retained by such Indemnified Person), or compromise or settle
such action or proceeding, at its expense; provided, however, that such counsel
shall be satisfactory to the Indemnified Person in the exercise of its
reasonable judgment.  Notwithstanding the
Company’s election to assume the defense of such action or proceeding, such
Indemnified Person shall have the right to employ separate counsel and to
participate in the defense of such action or proceeding, and the Company shall
bear the reasonable fees, costs and expenses of such separate counsel (and
shall pay such fees, costs and expenses at least quarterly), if (a) the
use of counsel chosen by the Company to represent such Indemnified Person
would, in the judgment of the Indemnified Person, present such counsel with a
conflict of interest; (b) the defendants in, or targets of, any such
action or proceeding include both an Indemnified Person and the Company, and
such Indemnified Person shall have reasonably concluded that there may be legal
defenses available to it or to other Indemnified Persons which are different
from or additional to those available to the Company (in which case the Company

 

 

shall not have the right
to direct the defense of such action or proceeding on behalf of the Indemnified
Person); (c) the Company shall not have employed counsel satisfactory to
such Indemnified Person in the exercise of the Indemnified Person’s reasonable
judgment to represent such Indemnified Person within a reasonable time after
notice of the institution of such action or proceeding; or (d) the Company
shall authorize such Indemnified Person to employ separate counsel at the
Company’s expense.

 

In order to provide for
the just and equitable contribution, if a claim for indemnification hereunder
is found unenforceable in a final judgment by a court of competent jurisdiction
(not subject to further appeal), even though the express provisions hereof
provide for indemnification in such case, then the Company and Consultant shall
contribute to the losses, claims, damages, judgments, liability, expenses or
costs to which the Indemnified Person may be subject in accordance with the
relative benefits received by, and the relative fault of, each in connection
with the statements, acts or omissions which resulted in such losses, claims,
damages, judgments, liabilities, or costs. 
The Company agrees that a pro rata allocation would be unfair.  No person found liable for a fraudulent
misrepresentation or omission shall be entitled to contribution from any person
who is not also found liable for such fraudulent misrepresentation or
omission.  Notwithstanding the foregoing,
Consultant shall not be obligated to contribute any amount hereunder that
exceeds the amount of fees previously received by Consultant for its services to
the Company.

 

These indemnification provisions
shall (i) remain operative and in full force and effect regardless of any
termination or completion of the engagement of Consultant; (ii) inure to
the benefit of any successors, assigns, heirs or personal representative of any
Indemnified Person; and (iii) be in addition to any other rights that any
Indemnified Person may have.Exhibit 10.14

 

SPESCOM
SOFTWARE LIMITED

(Registered number
2253256)

(the “Company”)

 

To: Absa Bank Limited 

(the “Bank”)

 

9th November 2005

 

Dear Sirs

 

Facility Letter dated 17 April 2000 (and entered into by Spescom
Limited (a company incorporated under the laws of the Republic of South Africa
with registered number 1987/001083/06) (the “Borrower”)
on 18 April 2000) between the Borrower and the Bank as amended and
restated by the First Supplemental Agreement dated 31 May 2002 between the
Borrower and the Bank (the “Facility Letter”).

 

1              We
refer to the Facility Letter. Terms and expressions defined or used in the
Facility Letter shall, unless the context otherwise requires, bear the same
meanings in this letter.

 

2              We
also refer to the Guarantee and Indemnity dated 31 May 2002 (the “Guarantee”) entered into by the Borrower in favour of the
Bank.

 

3              The
Facility Letter is to be the subject of amendment and restatement in accordance
with the terms of a second supplemental agreement (the “Second Supplemental Agreement”) to be entered into on or about the
date of this letter between the Bank and the Borrower.

 

4              We,
the Company, acknowledge, confirm and agree that:

 

(a)           we
have not given notice to the Bank to determine the Guarantee under Clause 3 of the
Guarantee;

 

(b)           the
Guarantee continues in full force and effect in accordance with its terms and guarantees
all present and future obligations and liabilities which are for the time being
(whether actual or contingent and whether owed jointly or severally or in any other
capacity whatsoever) due, owing or incurred by the Borrower or any Subsidiary
(as defined in the Guarantee) to the Bank on any account whatsoever; and

 

(c)           the
amendments made to the Facility Letter by the Second Supplemental Agreement and
the entry into of the Second Supplemental Agreement shall not affect the
legality, validity or binding nature of our obligations under the Guarantee.

 

5              Each
representation and warranty contained in the Guarantee, if any, remains true and
correct in all respects and is deemed to be repeated as at the date hereof and the
Effective Date (as defined in the Second Supplemental Agreement) and we confirm
that we are in compliance with all of our other obligations contained in the Guarantee.

 

6              This
letter is designated a Finance Document executed pursuant to the Facility Letter.

 

1

 

7              Clause
29 of the Guarantee shall be deemed incorporated in this letter but as if references
to the Guarantee were references to this letter.

 

6              Unless
the right of enforcement is
expressly granted, it is not intended that a third party should have the right
to enforce a provision of this letter pursuant to the Contracts (Rights of
Third Parties) Act 1999. The parties hereto may rescind or vary this letter
without the consent of a third party to whom an express right to enforce any of
its terms has been provided.

 

Please countersign below to confirm your agreement to these terms.

 

This letter is executed and delivered as a deed, notwithstanding the
fact that the Bank may sign under hand, on the date first above written.

 

Executed and delivered as a deed by 

Spescom Software Limited

acting by:

 

 

	
  Director:

  	
  /s/  John W. Low

  	
   

  
	
  Print Full Name:

  	
  John W. Low

  
				

 

	
  Director:

  	
  /s/  Ben
  Martin

  	
   

  
	
  Print Full Name:

  	
  Ben Martin

  
				

 

Being a person(s) who, in accordance with the laws of that territory,
is acting under the authority of that company.

 

We agree the above

 

For and on behalf of 

ABSA Bank Limited

 

	
  Date:

  	
   

  	
  November 9th 2005

  

 

2

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