August 9, 2004
Xxxxxx Xxxxxx
Chief Executive Officer
Zone4PLay Inc.
0x Xxxxxxxxx Xx.
Xxx Xxxx 00000
Xxxxxx
Dear Xx. Xxxxxx:
This Agreement is made and entered into this __th day of ____, 2004,
between Punk, Xxxxxx & Company, L.P. ("Punk, Xxxxxx") and Zone4Play, Inc. and
its affiliates and subsidiaries (collectively "Zone4Play" or the "Company").
In consideration of the mutual promises made herein and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. The Company hereby engages Punk, Xxxxxx upon the terms and conditions as set
forth herein as its exclusive financial advisor to render financial advice to
the Company as an investment banker with respect to Placement Transactions, M&A
Transactions (each, as defined below), joint ventures. In that regard, Punk,
Xxxxxx will assist the Company in identifying, analyzing, structuring,
negotiating and financing suitable business opportunities which the Company may
take advantage of by purchase or sale of stock or assets (except assets used in
the ordinary course of business), assumption of liabilities, merger,
consolidation, tender offer, joint venture, financing arrangement or any similar
transaction or combination thereof.
2. Except as otherwise specified in Paragraph 14 hereof, this Agreement shall be
effective for a period of Six (6) months, commencing upon the execution hereof
and shall terminate thereafter unless and until extended by mutual agreement of
the parties.
3. During the term of this Agreement, Punk, Xxxxxx shall provide the Company
with such regular and customary investment banking advice as is reasonably
requested by the Company, provided that Punk, Xxxxxx shall not be required to
undertake duties not reasonably within the scope of the investment banking
services contemplated by this Agreement.
4. Without derogating from any of the provisions of this letter, Punk, Xxxxxx
shall render such other financial advisory and investment banking services as
may from time to time be agreed upon in writing by Punk, Xxxxxx and the Company.
PLACEMENT AGENT
5. The Company hereby engages Punk, Xxxxxx, for the term of this agreement, as
its exclusive agent in the private placement of equity and equity-linked
securities (the "Equity Securities"), debt financing (the "Debt Securities"), or
any combination of Equity Securities and Debt Securities thereof (collectively
referred to as "Placement Transactions"). For the purposes of this Agreement,
Debt Securities shall include acquisition lines of credit, any form of bank
lines, mezzanine or other debt, vendor financings, etc. but shall not include
extensions, renewals, modifications or refinancings of credit with existing
creditors or their affiliates. Public offerings, if any, shall be subject to a
separate letter agreement and are expressly not addressed in this Agreement.
Should a fairness opinion be required, The Company and Punk, Xxxxxx enter into a
separate letter agreement, which shall govern the issuance of such opinion,
including any fees.
August 9, 2004
Zone4Play Engagement
Page 2
6. Punk, Xxxxxx hereby accepts the engagement, with respect to any Placement
Transaction, and in that connection agrees to:
(a) prepare, if asked, in consultation with the Company, an Information
Memorandum (the "Memorandum") describing the Company and the
Placement Transaction, which Memorandum shall not be made available
to potential investors or lenders until such Memorandum and its use
shall be approved by the Company;
(b) review with the Company, and receive its approval for, a list of
prospective investors and lenders (the "Contact List") to be
contacted by Punk, Xxxxxx in connection with its engagement herein;
(c) use its best efforts to privately place the Equity Securities or
Debt Securities;
(d) prepare, if asked, with the assistance and approval of the Company
any other communications to be used in the Placement Transaction
whether in the form of letter, circular, notice or otherwise;
(e) assist in the negotiation of the terms and conditions of the
placement of the Equity Securities or Debt Securities to investors
and lenders;
(f) advise the Company as to the expected timing, structure and pricing
of the Placement Transaction; and
(g) provide such other investment banking services as are customary for
similar engagements.
7. As compensation for the services to be rendered by Punk, Xxxxxx as the
Company's placement agent, the Company shall pay to Punk, Xxxxxx as
follows, subject to a minimum fee of Two hundred and fifty thousand
dollars ($250,000) for each Placement Transaction (the "Financing Fee").
(a) Upon the execution hereof, a non-refundable advance payment fee of
fifty thousand dollars ($50,000) (the "Retainer Fee"). The Retainer
Fee shall be paid: (i) $25,000 in cash (paid in 4 installments), and
(ii) a warrant (the "Retainer Warrants") to purchase 25,000 of the
Company's common stock at an exercise price of $0.80 per share and
including other terms and conditions as more fully described below.
(b) At the closing of each placement of Equity Securities and after
actual receipts of funds by the company, the Company shall pay in
cash to Punk, Xxxxxx by wire transfer a cash fee (a "Equity
Securities Placement Fee") of Six percent (6.0%) of the Aggregate
Placement Consideration (as defined in paragraph 9) raised in the
Placement Transaction The cash advance payment will be deducted from
the Equity securities placement fee. In a case that the company will
decide to defer collection, or to leave the funds in a escrow
account after the closing of such transaction, than the company
shall pay in cash, the fee to Punk, Xxxxxx. The Company and Punk,
Xxxxxx agree to carve out an amount of $1,500,000 (one million and
five hundred dollars, which shall include $450,000 that the Company
has already raised and that are currently held in an escrow
account), for which, if raised no later than the close of business
on August 31 2004 (the "Carve Out"), Punk, Xxxxxx will not be
entitled to any fee. The carve out shall terminate on August 31,
2004 and any amount raised after that time, irrespective of the
source or the referring party shall be subject to the fee provisions
of this Agreement.
August 9, 2004
Zone4Play Engagement
Page 3
(c) At the closing of each placement of Equity Securities, the Company
shall issue to Punk, Xxxxxx warrants (the "Fee Warrants") to
purchase shares of the Company's common stock equal to Two percent
(2.0%) of the Aggregate Placement Consideration with an exercise
price per share equal to the price at which common stock was sold or
valued in the Placement Transactions.
(d) The terms of the Warrants shall be set forth in one or more
agreements (the "Warrant Agreements") in form and substance
reasonably satisfactory to Punk, Xxxxxx and the Company.
(e) At the closing of each placement of Debt Securities and after actual
receipts of funds by the company., the Company shall pay in cash to
Punk, Xxxxxx by wire transfer a cash fee (a "Debt Securities
Placement Fee") of three percent (3.0%) of the Aggregate Placement
Consideration (as defined in paragraph 8) raised in the Placement
Transaction. The cash advance payment will be deducted from the Debt
Securities placement fee. In a case that the company will decide to
defer collection , or to leave the funds in a escrow account after
the closing of such transaction, than the company shall pay in cash,
the fee to Punk, Xxxxxx
(f) In avoidance of doubt, in the event of a combined placement that
includes equity securities and debt securities, the advance payment
will be deducted only once.
8. In determining "Aggregate Placement Consideration" for purposes of
calculating Punk, Xxxxxx'x Placement Fee under paragraph 7 above, the
following principles will apply:
(a) Aggregate Placement Consideration shall be deemed to include the
total value of Equity and Debt Securities sold, directly or
indirectly, by the Company in connection with the Placement
Transaction, including proceeds received by the Company upon
exercise of options, warrants and/or similar securities, any amounts
paid into escrow and any amounts payable in the future whether or
not subject to any contingency including advances on licensing fees
and product sales.
August 9, 2004
Zone4Play Engagement
Page 4
(b) If the consideration received by the Company is to be paid in whole
or in part through installment payments, the portion of Punk,
Xxxxxx'x Securities Placement Fee relating thereto shall be
calculated and paid when and as such contingent payments are due.
(c) If the consideration received by the Company is paid in whole or in
part in the form of securities or other non-cash consideration, such
consideration shall be valued at the fair market value thereof, on
the day prior to the date of closing (or later date on which a
contingent payment is made), provided, however, that if such
consideration consists of securities with an existing trading
market, such securities shall be valued at the average of the last
sales price for such securities on the five trading days prior to
the date of closing (or later date on which a contingent payment is
made).
M&A ADVISOR
9. The Company hereby engages Punk, Xxxxxx as its exclusive advisor in
connection with mergers and acquisitions advisory services.
10. Punk, Xxxxxx hereby accepts the engagement and in that connection
agrees to assist and advise the Company in regard to any potential
M&A Transaction, as defined in section 12 below, in the following
manner:
(a) evaluate and recommend financial and strategic alternatives
with respect to M&A Transactions;
(b) identify potential parties to M&A Transactions and contact
such parties and/or their representatives and assist the
Company in negotiations relating to a M&A Transaction;
(c) assist the Company, if asked, in performing appropriate due
diligence on prospective acquisitions;
(d) assist in the negotiation of prospective acquisitions
including advice regarding the timing, structure and pricing
of a M&A Transaction;
(e) assist the Company, if asked, in any documentation necessary
to execute the M&A Transaction;
(f) assist the Company in arranging financing (as described in
paragraphs 5, 6,7 and 8), as needed; and
(g) Provide such other financial advisory and investment banking
services as are customary for similar transactions and as may
be mutually agreed upon by the Company and Punk, Xxxxxx.
11. At the closing of each M&A Transaction, the Company shall pay Punk,
Xxxxxx a fee equal to: (i) three percent (3.0%) of the first twenty
million dollars ($20,000,000) and (ii) one and one-half percent
(1.5%) of the excess above twenty million of the Aggregate M&A
Consideration (as defined below) of such M&A Transaction, subject to
a minimum fee of one hundred fifty thousand dollars ($150,000)
(collectively referred to as the "M&A Transaction Fee"). The M&A
Transaction Fee shall not include any fairness opinions that may be
required in the course of a transaction. If the consideration for
the Transaction is cash, then the Compensation shall be paid in
cash. If the consideration for the Transaction is other than cash,
then the form of the Compensation shall be: half of the compensation
will be as the same nature as the consideration given in the
Transaction and the remainder will be paid in cash.
August 9, 2004
Zone4Play Engagement
Page 5
12. For the purpose of this Agreement, "M&A Transaction" shall mean
merger, business combination, purchase or sale of some or all of the
stock or assets of the Company or a Target not in the ordinary
course of business, joint venture or any similar transaction or
combination thereof. "Aggregate M&A Consideration" shall mean the
total consideration (cash, stock, assets and all other property
(real and personal, tangible or intangible) including debt assumed)
exchanged or received, or to be exchanged or received, or paid or
incurred, directly or indirectly by the Company or any of its
security holders in connection with any such M&A Transaction. M&A
Transaction Fees shall be paid by the Company to Punk, Xxxxxx at the
first closing of each M&A Transaction. If the Aggregate M&A
Consideration is to be paid in whole or in part through installment
payments, the portion of Punk, Xxxxxx'x M&A Transaction Fees
relating thereto shall be calculated and paid when and as such
contingent payments are due.
GENERAL
13. In the event that the Company completes a transaction in lieu of any
Placement Transaction or M&A Transaction during the course of this
engagement to which clauses in paragraphs 1 through 12 do not apply,
Punk, Xxxxxx shall receive a customary investment banking fee to be
mutually agreed upon between Punk, Xxxxxx and the Company based on
the nature and type of services rendered.
14. In the event that this Agreement shall not be renewed or if
terminated for any reason, notwithstanding any such non-renewal or
termination, Punk, Xxxxxx shall be entitled to a full fee as
provided herein, for each Placement Transaction or M&A Transaction
for which the discussions were conducted during the term of this
Agreement by the Company or by Punk, Xxxxxx on behalf of the
Company, which is consummated within a period of twelve (12) months
after non-renewal or termination of this Agreement. Upon termination
of this Agreement, the Company and Punk, Xxxxxx shall provide each
other with a written list of parties with whom they had discussions
in connection with any Placement Transaction or M&A Transaction
which list shall govern the operation of this Paragraph.
15. In addition to the fees payable hereunder, and regardless whether
any Placement Transaction or M&A Transaction is proposed or
consummated, the Company shall reimburse Punk, Xxxxxx periodically
for the term of this Agreement for all out-of-pocket expenses, fees
and disbursements incurred in connection with the services performed
by Punk, Xxxxxx pursuant to this Agreement, including fees and
disbursements of Punk, Xxxxxx'x legal counsel and any advisers.
Punk, Xxxxxx will seek the Company's written approval for expenses
exceeding $1,000 and will supply the Company with reasonable
documentation to support its claims for reimbursement. The Company
shall reimburse Punk, Xxxxxx its out of pocket expenses incurred in
the course of any work done with respect to the Carve-Out, subject
to the terms of this Agreement.
August 9, 2004
Zone4Play Engagement
Page 6
16. The Company acknowledges that all opinions and advice (written or
oral) given by Punk, Xxxxxx to the Company in connection with Punk,
Xxxxxx'x engagement hereunder are intended solely for the benefit
and use of the Company in considering Placement Transactions or M&A
Transactions to which they relate, and the Company agrees that no
person or entity other than the Company be entitled to make use of
or rely upon the advice of Punk, Xxxxxx to be given hereunder, and
no such opinion or advice shall be used for any other purpose or
reproduced, disseminated, quoted or referred to at any time, in any
manner or for any purpose, nor may the Company make any public
references to Punk, Xxxxxx, or use Punk, Xxxxxx'x name in any annual
reports or any other reports, releases or electronic publications of
the Company without Punk, Xxxxxx'x prior written consent.
17. The Company acknowledges that Punk, Xxxxxx and its affiliates are in
the business of providing investment banking and other financial
services and advice. Nothing herein contained shall be construed to
limit or restrict Punk, Xxxxxx in conducting such business with
respect to others, or in rendering such advice to others, except as
such advice may relate to matters relating to the Company's
business.
18. The Company acknowledges and agrees that in performing its services
under this engagement, Punk, Xxxxxx may rely upon the data, material
and other information supplied by the Company without independently
verifying its accuracy, completeness or veracity. The Company
represents and warrants to Punk, Xxxxxx that it shall endeavor that
all such information provided by the Company will be true and
accurate in all material respects and will not contain any untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading.
Punk, Xxxxxx shall be under no obligation to make an independent
appraisal of assets or an investigation or inquiry as to any
information regarding, or any representations of, any other
participant in a Placement Transaction or M&A Transaction, and shall
have no liability with regard thereto. The Company acknowledges and
agrees that Punk, Xxxxxx will be using and relying upon such
information supplied by the Company and its officers, agents and
others and any other publicly available information concerning the
Company without any independent investigation or verification
thereof or independent appraisal by Punk, Xxxxxx of the Company or
its business or assets.
19. Since Punk, Xxxxxx will be acting on behalf of the Company in
connection with its engagement hereunder, the Company and Punk,
Xxxxxx have entered into a separate indemnification agreement (the
"Indemnification Agreement") attached hereto as Schedule A and dated
the date hereof, providing for the indemnification of Punk, Xxxxxx
by the Company. Punk, Xxxxxx has entered into this Agreement in
reliance on the indemnities set forth in such Indemnification
Agreement.
August 9, 2004
Zone4Play Engagement
Page 7
20. Punk, Xxxxxx shall perform its services hereunder as an independent
contractor and not as an employee of the Company or an affiliate
thereof. It is expressly understood and agreed to by the parties
hereto that Punk, Xxxxxx shall have no authority to act for,
represent or bind the Company or any affiliate thereof in any
manner, except as may be agreed to expressly by the Company from
time to time.
21. This Agreement and the Schedule A attached hereto constitute the
entire agreement and understanding of the parties hereto, and
supersede any and all previous agreements and understandings,
whether oral or written, between the parties with respect to the
matters set forth herein.
22. Any notice or communication permitted or required hereunder shall be
in writing and shall be deemed sufficiently given if hand-delivered
or sent (i) postage prepaid by registered mail, return receipt
requested, or (ii) by facsimile to the respective parties as set
forth below, or to such other address as either party may notify the
other of in writing:
if to the Company, to: Xx. Xxxxxx Xxxxxx
Chief Executive Officer
Zone4PLay Inc.
0x Xxxxxxxxx Xx.
Xxx Xxxx 00000
Xxxxxx
if to Punk, Xxxxxx, to: Punk, Xxxxxx & Company
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Sagiv Shiv, Managing Director
23. During the term of this Agreement, Punk, Xxxxxx shall have the right
to place advertisements in financial and other newspapers and
journals at its own expense describing its services to the Company
hereunder, provided that the Company shall approve in writing the
form and content thereof in advance.
24. This agreement may not be assigned by either party without the prior
written consent of the other. The benefits of this Agreement shall
be binding upon and inure to the benefit of the respective
successors, legal representatives and permitted assigns of the
parties hereto and the obligations and liabilities assumed in this
Agreement by the parties hereto shall be binding upon their
respective successors, legal representatives and permitted assigns.
25. This Agreement may be executed in any number of counterparts, each
of which together shall constitute one and the same original
document.
26. No provision of this Agreement may be amended, modified or waived,
except in writing signed by all of the parties hereto.
27. This Agreement shall be construed in accordance with and governed by
the laws of the State of New York, without giving effect to its
conflict of law principles. The parties hereby agree that any
dispute which may arise between them arising out of or in connection
with this Agreement shall be adjudicated before a court located in
New York City, and they hereby submit to the exclusive jurisdiction
of the courts of the State of New York located in New York, New York
and of the federal courts in the Southern District of New York with
respect to any action or legal proceeding commenced by any party,
and irrevocably waive any objection they now or hereafter may have
respecting the venue of any such action or proceeding brought in
such a court or respecting the fact that such court is an
inconvenient forum, relating to or arising out of this Agreement,
and consent to the service of process in any such action or legal
proceeding by means of registered or certified mail, return receipt
requested, in care of the address set forth in Paragraph 24 hereof.
August 9, 2004
Zone4Play Engagement
Page 8
28. EACH OF PUNK, XXXXXX AND THE COMPANY WAIVES ALL RIGHT TO TRIAL BY
JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM (WHETHER BASED
ON CONTRACT, TORT OR OTHERWISE) RELATED TO OR ARISING OUT OF THIS
AGREEMENT.
Punk, Xxxxxx is delighted to accept this engagement and looks forward to working
with you on this assignment. Please confirm that the foregoing correctly sets
forth our agreement by signing the enclosed duplicate of this letter in the
space provided and returning it, whereupon this letter shall constitute a
binding agreement as of the date first above written.
PUNK, XXXXXX & COMPANY, L.P.
By
---------------------------------------
By /s/ Sagiv Shiv
---------------------------------------
Sagiv Shiv
Managing Director
AGREED:
ZONE4PLAY, INC.
By /s/ Xxxxxx Xxxxxx
----------------------------------
Xxxxxx Xxxxxx
Chief Executive Officer
By
----------------------------------
SCHEDULE A
August 9, 2004
INDEMNIFICATION PROVISIONS
Zone4Play, Inc. (the "Company") agrees to indemnify and hold harmless
Punk, Xxxxxx & Company, L.P. ("Punk, Xxxxxx") to the fullest extent permitted by
law, from and against any and all losses, claims, damages, obligations,
penalties, judgments, liabilities, costs, expenses and disbursements (and any
and all actions, suits, proceedings and investigations in respect thereof and
any and all legal and other costs, expenses and disbursements in giving
testimony or furnishing documents in response to a subpoena or otherwise),
including, without limitation, the costs, expenses and disbursements, as and
when incurred, of investigating, preparing or defending any such action, suit,
proceeding or investigation (whether or not in connection with litigation in
which Punk, Xxxxxx is a party) by a third party, as and when incurred, directly
or indirectly, caused by, relating to, based upon, arising out of or in
connection with (a) Punk, Xxxxxx acting for the Company including, without
limitation, any act or omission by Punk, Xxxxxx in connection with its
acceptance of or the performance or non-performance of its obligations under an
engagement letter, dated______ __, 2004, between Punk, Xxxxxx and the Company,
as it may be amended from time to time (the "Agreement"); (b) any untrue
statement or alleged untrue statement of a material fact contained in, or any
omission or alleged omission to state a material fact required to be stated or
necessary to make not misleading statements made in any offering document
produced pursuant to the Agreement, including any amendment thereof or
supplement thereto, or similar statements or omissions in or from any other
information furnished by or on behalf of the Company to Punk, Xxxxxx or to any
prospective investor/suitor pursuant to this Agreement, including any amendments
thereof or supplements thereto, or any other activity on their behalf; (c)
violations by the Company of any of its representations, warranties or
agreements contained in or incorporated into the Agreement; (d) all or any
portion of any transaction or (e) the use of proceeds of any transaction;
provided, however, such indemnity agreement shall not apply to any portion of
any such loss, claim, damage, obligation, penalty, judgment, liability, cost or
expense to the extent it is found in a final judgment by a court of competent
jurisdiction (not subject to further appeal for whatever reason, including,
without limitation, the failure to file an appeal in a timely fashion) to have
resulted directly from the gross negligence or willful misconduct of Punk,
Xxxxxx.
These Indemnification Provisions shall extend to the following: Punk,
Xxxxxx, its parent company, their affiliated entities, directors, officers,
employees, legal counsel, and agents of Punk, Xxxxxx, its and the respective
affiliates and controlling persons of Punk, Xxxxxx within the meaning of the
federal securities laws. All references to Punk, Xxxxxx in these Indemnification
Provisions shall be understood to include any and all of the foregoing.
If any action, suit, proceeding or investigation is commenced, as to which
Punk, Xxxxxx proposes to demand indemnification, it shall so notify the Company
with reasonable promptness; provided, however, that any failure by Punk, Xxxxxx
to notify the Company shall not relieve the Company from its obligations
hereunder. Punk, Xxxxxx shall have the right to retain counsel of its own choice
to represent it, and the Company shall pay reasonable and customary fees,
expenses and disbursements of such counsel; and such counsel shall, to the
extent consistent with its professional responsibilities, cooperate with the
Company and any counsel designated by the Company. The Company shall pay and be
liable for any settlement of any claim against Punk, Xxxxxx made with the
Company's written consent, which consent shall not be unreasonably withheld. The
Company shall not, without the written consent of Punk, Xxxxxx, settle or
compromise any claim or permit a default or consent to entry of any judgment in
respect thereof unless such settlement, compromise or consent includes as an
unconditional term thereof the giving by the claimant to Punk, Xxxxxx of an
unconditional and irrevocable release from all liability in respect of such
claim.
August 9, 2004
Schedule A - Zone4Play Indemnification
Page 2
In order to provide for just and equitable contribution, if a claim for
indemnification pursuant to these Indemnification Provisions is made but it is
found in a final judgment by a court of competent jurisdiction (not subject to
further appeal) that such indemnification may not be enforced in such case, even
though the express provisions hereof provide for indemnification in such case,
then the Company, on the one hand, and Punk, Xxxxxx, on the other hand, shall
contribute to the amount paid or payable by such indemnified persons as a result
of such losses, claims, damages, obligations, penalties, judgments, liabilities,
costs, expenses and disbursements in such proportion as is appropriate to
reflect the relative benefits received by the Company, on the one hand, and
Punk, Xxxxxx, on the other hand from any transactions contemplated by the
Agreement, and also the relative fault of the Company on the one hand and Punk,
Xxxxxx on the other hand, in connection with the statements, acts or omissions
which resulted in such losses, claims, damages, obligations, penalties,
judgments, liabilities, costs, expenses and disbursements and any other relevant
equitable considerations shall also be considered. 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, Punk, Xxxxxx shall not be obligated to
contribute any amount hereunder that exceeds the amount of fees previously
received by Punk, Xxxxxx pursuant to the Agreement.
The Indemnification Provisions and contribution agreements contained
herein are in addition to any liability which the Company may otherwise have to
Punk, Xxxxxx and the other parties.
Neither termination nor completion of the engagement of Punk, Xxxxxx set
forth in the Agreement nor any investigation made by or on behalf of Punk,
Xxxxxx or the Company shall effect these Indemnification Provisions and
contribution agreements which shall remain and continue to be operative and in
full force and effect.
We agree that if any indemnity sought by an Indemnified Person hereunder
is held by a court to be unavailable for any reason, then (whether or not Punk,
Xxxxxx is the Indemnified Person), we and Punk, Xxxxxx shall contribute to the
Claim for which such indemnity is held unavailable in such proportion as is
appropriate to reflect the relative benefits to us, on the one hand, and Punk,
Xxxxxx on the other, in connection with Punk, Xxxxxx'x engagement referred to
above, subject to the limitation that in no event shall the amount of Punk,
Xxxxxx'x contribution to such Claim exceed the amount of fees actually received
by Punk, Xxxxxx from us pursuant to Punk, Xxxxxx'x engagement. We hereby agree
that the relative benefits to us, on the one hand, and Punk, Xxxxxx on the
other, with respect to Punk, Xxxxxx'x engagement shall be deemed to be in the
same proportion as (a) the total value paid or proposed to be paid or received
by us or our stockholders as the case may be, pursuant to the transaction
(whether or not consummated) for which you are engaged to render services bears
to (b) the fee actually paid to Punk, Xxxxxx in connection with such engagement.
Our indemnity, reimbursement and contribution obligations under this
Agreement shall be in addition to, and shall in no way limit or otherwise
adversely affect any rights that any Indemnified Party may have at law or at
equity.
Should Punk, Xxxxxx or its personnel be required or requested by us to
provide documentary evidence or testimony in connection with any proceeding
arising from or relating to Punk, Xxxxxx'x engagement, we agree to pay all
reasonable expenses (including fees incurred for legal counsel) in complying
therewith and for sworn testimony or preparation therefor, payable in advance.
August 9, 2004
Schedule A - Zone4Play Indemnification
Page 3
We hereby consent to personal jurisdiction and service of process and
venue in any court in which any claim for indemnity is brought by any
Indemnified Person.
It is understood that, in connection with Punk, Xxxxxx'x engagement, Punk,
Xxxxxx may be engaged to act in one or more additional capacities and that the
terms of the original engagement or any such additional engagement may be
embodied in one or more separate written agreements. The provisions of this
Agreement shall apply to the original engagement, any such additional engagement
and any modification of the original engagement or such additional engagement
and shall remain in full force and effect following completion or termination of
Punk, Xxxxxx'x engagement(s).
Sincerely,
ZONE4PLAY, INC.
By: /s/ Xxxxxx Xxxxxx
--------------------------------------
Xxxxxx Xxxxxx
Chief Executive Officer
By:
--------------------------------------
Confirmed and agreed to:
PUNK, XXXXXX & COMPANY, L.P.
By:
--------------------------------------
By: /s/ Sagiv Shiv
--------------------------------------
Sagiv Shiv
Managing Director
