EXHIBIT 10.2
[BRIGHTON STREET ADVISORY, L.L.C. LETTERHEAD]
June 26, 2001
Board of Directors
Accelacorp 1, Inc.
0000 Xxxx Xxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Gentlemen:
This agreement confirms that Accelacorp 1, Inc. (the "Company")
has retained Brighton Street Advisory, L.L.C., a California limited
liability company ("Brighton") as its financial advisor in connection
with a potential Transaction (as defined below). Brighton agrees to
advise and assist the Company in acquiring or merging with another
company or business or other similar transaction or series of
transactions (any of the foregoing, a "Transaction").
Terms of Engagement
1. The Company has the right to reject any offers that may
result from this engagement. Xxxxxxxx's engagement provides no
assurance that the Company will consummate the Transaction. Xxxxxxxx
also believes it is vital that its advice be balanced with input from
legal and other professional advisors to the Company.
2. During the period of Xxxxxxxx's engagement, neither
the Company nor any agent or representative thereof (other than
Xxxxxxxx) will directly or indirectly initiate discussions or other
contacts, or solicit any inquiries or indications, regarding a
Transaction without promptly notifying Brighton. The Company shall
furnish Brighton with the names of all parties that the Company or its
management or directors have conducted any discussions with, received
inquiries from, or had any other contact with, prior to the date hereof,
concerning a possible Transaction. In the event the Company or its
management or directors receives an inquiry or contact regarding a
Transaction, they will promptly advice Brighton of such inquiry and the
identity of the party making the same in order that we can evaluate such
prospective third-party interest and assist the Company in any resulting
negotiations with respect thereto. The Company acknowledges that there
are no brokers, representatives or other persons which have an interest
in compensation due to Brighton from any Transaction contemplated
herein.
3. Based on the nature of the services to be provided, we
anticipate that our reporting to the Company will be principally oral
with discussion outlines as appropriate. The Company agrees that any
reports provided by Xxxxxxxx, whether verbal or written, and any
writings involving Xxxxxxxx will be used exclusively for the purpose of
evaluating a possible Transaction and will not be distributed to parties
other than the Company's management, directors or advisors without
Xxxxxxxx's prior written consent. In addition, the reports shall not be
reproduced, disseminated, quoted or referred to at any time, in any
manner or for any other purpose, nor shall other references to Brighton
or the advice rendered in the reports be made to any third party without
the prior written consent of Brighton, and the reports shall not be
distributed to anyone who is not a member of the management of the
Company and its officers, directors and advisors. Xxxxxxxx will have no
responsibility to update the reports for events and circumstances
occurring after the date of the reports.
Professional Fees and Expense Reimbursement
4. Brighton fixes the valued-added fee for this type of
engagement at the completion of the engagement. Our fee will be set
based upon a number of factors including, personnel and their time and
effort, the complexity of the transaction, the services provided, the
value added to the engagement by Brighton, and the current market
compensation for the type of services contemplated hereunder. The
minimum value-added fee will be $25,000. We will discuss our bill with
you prior to closing.
5. It is understood and agreed that if the Company completes a
transaction in lieu of any Transaction for which Xxxxxxxx is entitled to
compensation pursuant to this agreement, Brighton and the Company will
in good faith mutually agree upon acceptable compensation for Brighton,
taking into account, among other things, the results obtained and the
custom and practice among financial advisors acting in similar
transactions.
Available Information
6. The Company shall make available to Brighton all information
concerning the Company's business and operations which Brighton
reasonably requests, including, in particular, any information which, if
disclosed, could have a material impact on the likely success of the
Transaction, as well as any other information relating to the properties
of the Company or the Transaction prepared by the Company or any of its
other advisors. The Company will also provide Brighton with reasonable
access to the Company's officers, directors and employees. Brighton
shall be entitled to rely upon all information supplied to it by the
Company or its advisors, which information shall be fair, accurate and
complete and shall not contain any material omissions or misstatements
of fact, and Brighton shall not in any respect be responsible for the
accuracy or completeness of, or have any obligation to verify, the same
or to conduct any appraisal of any of the Company's assets.
Indemnification
7. Recognizing that Xxxxxxxx's role is advisory and in partial
consideration for the services to be rendered hereunder, the Company
agrees to indemnify and hold Brighton, and its officers, directors,
employees, agents, attorneys, affiliates and any persons retained in
connection with the performance of the services described herein (each
an "Indemnified Party" and, collectively, the "Indemnified Parties"),
harmless from and against any and all claims, losses, damages,
deficiencies, liabilities (joint or several), lawsuits, judgments, costs
and expenses (including, as incurred and without limitation, reasonable
attorneys' fees, interest, penalties, travel expenses, wages allocable
to the loss of employee time and all amounts paid in investigation,
defense or settlement of any of the foregoing) arising out of
(collectively, "Damages"), based upon or related to Xxxxxxxx's
engagement described herein. This indemnification shall include Damages
arising out of any dispute related to such engagement and to any
contemplated or consummated Transaction, whether or not any Indemnified
Party is a party to such dispute. This indemnification shall also
include Damages arising out of any untrue statement or alleged untrue
statement of a material fact contained in any information provided to
Brighton by the Company, or the omission or alleged omission therefrom
of a material fact required to be stated therein or necessary to make
the statements therein not misleading (in the light of the circumstances
under which they were made). However, the Company shall not be liable
for Damages incurred by an Indemnified Party to the extent that a court
having competent jurisdiction shall have determined by final judgment
(not subject to further appeal) that such Damages resulted primarily and
directly from the willful malfeasance or gross negligence of such
Indemnified Party.
The Company agrees that no Indemnified Party shall have any
liability for any Damages sustained by the Company (or any person
claiming through the Company) unless a court having competent
jurisdiction shall have determined by final judgment (not subject to
further appeal) that such Damages resulted primarily and directly from
the willful malfeasance or gross negligence of such
Indemnified Party. The Company further agrees that it will not, without
the prior written consent of Xxxxxxxx, settle, compromise or consent to
the entry of any judgment in any pending or threatened action in respect
of which indemnification may be sought hereunder (whether or not
Brighton or any Indemnified Party is an actual or potential party to
such action), unless such settlement, compromise or consent includes an
unconditional release of Brighton, and each other Indemnified Party
hereunder from all liability arising out of such action. In the event
the Company considers entering into one or a series of transactions
involving a merger or other business combination or a dissolution or
liquidation of all or a significant portion of its assets, the Company
shall promptly notify Brighton in writing. If requested by Brighton,
the Company shall then establish alternative means of providing for the
obligations set forth herein on terms and conditions reasonably
satisfactory to Brighton.
8. In the event that the indemnity provided for herein is
unavailable or insufficient to hold any Indemnified Party harmless, then
the Company and the Indemnified Party shall contribute to amounts paid
or payable by an Indemnified Party (i) in such proportion as
appropriately reflects the relative benefits received by the Company and
its affiliates, on the one hand, and such Indemnified Party and its
affiliates, on the other hand, in connection with the matters as to
which such Damages relate, or (ii) if the allocation provided by clause
(i) above is not permitted by applicable law, in such proportion as
appropriately reflects not only the relative benefits referred to in
clause (i) but also the relative fault of the Company and its
affiliates, on the one had, and such Indemnified Party and its
affiliates, on the other hand, as well as any other equitable
considerations. The amounts paid or payable by a party in respect of
Damages referred to above shall be deemed to include any legal or other
professional fees and expenses incurred in investigating, preparing or
defending any litigation, proceeding or other action or claim.
Notwithstanding the provisions of the foregoing paragraphs, each
Indemnified Party's share of the liability hereunder shall not exceed
the amount of fees actually received by such Indemnified Party under
this agreement (excluding any amounts received as reimbursement of legal
fees and expenses incurred by such Indemnified Party).
Termination
9. Xxxxxxxx's engagement hereunder may be terminated at any
time by the Company or by Brighton, as the case may be, upon written
notice to that effect delivered to and received by the other party at
least 10 days prior to the date of such termination. If at any time
prior to the expiration of 12 months after the effective date of
termination or expiration of this agreement, the Company shall proceed
with, complete or enter into a binding agreement with respect to a
Transaction with: (i) any party with which discussions regarding a
Transaction have been held during the period of Xxxxxxxx's engagement;
(ii) any party identified in good faith by Xxxxxxxx in writing as a
potential party to a Transaction; or (iii) any party that has approached
the Company while this agreement is in effect with Brighton, the Company
shall re-engage Xxxxxxxx pursuant to the terms of this agreement and
Brighton will be entitled to payment in full of all professional fees
incurred through the effective date of termination. In addition, upon
any termination of this agreement, Xxxxxxxx shall be entitled to prompt
reimbursement of all professional and its out-of-pocket expenses
(including fees and expenses of legal counsel) incurred through the
effective date of termination. The "Professional Fees and Expense
Reimbursement" and the "Indemnification" provisions of this agreement
will survive and remain operative and in full force and effect
regardless of any termination, completion or expiration of this
agreement.
Additional Terms
10. Xxxxxxxx's work on this engagement shall not constitute the
rendering of legal advice, or the providing of legal services, to the
Company. Accordingly, Xxxxxxxx shall not be deemed to express any legal
opinions with respect to any matters affecting the Company. Any such
legal services shall be provided by a firm licensed to practice law in
one or more applicable jurisdictions.
Xxxxxxxx's work on this engagement shall not consist of
effectuating transactions in the Company's securities. As such,
Brighton shall not provide any securities broker-dealer services to the
Company. Any such services shall be provided by a securities broker-
dealer registered with the Securities and Exchange Commission and the
National Association of Securities Dealers, Inc.
Xxxxxxxx's work on this engagement will not constitute an
attest service as that term is defined by the American Institute of
Certified Public Accountants (AICPA). Accordingly, Xxxxxxxx shall not
be deemed to express an opinion on any of the financial or other data
that Xxxxxxxx might assist the Company in preparing or any other report.
Any financial projections and the underlying assumptions will be
prepared and provided to Brighton by the Company.
11. Xxxxxxxx has been retained by the Company and the Company
acknowledges that the Company's engagement of Brighton is not deemed to
be on behalf of and is not intended to confer rights upon any
shareholder or owner of the Company or any other person not a party
hereto against Brighton or any Indemnified party.
12. The Company agrees that Xxxxxxxx has 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
Xxxxxxxx will submit a copy of any such advertisements to the Company
for its approval, which approval shall not be unreasonably withheld or
delayed.
13. In the event any legal action or other proceeding is brought
for the enforcement of this agreement or in connection with any alleged
dispute, breach, default or misrepresentation in connection with any of
the provisions of this agreement, the successful or prevailing party or
parties shall be entitled to recover reasonable attorneys' fees or any
other costs incurred in connection with any such action or proceeding,
in addition to any other relief to which any such party may be entitled.
14. Notice given pursuant to any of the provisions of this
Agreement shall be in writing and shall be mailed or delivered: (a) if
to the Company at its offices at 0000 Xxxx Xxxxxxx Xxxxxxxxx, Xxxxx
0000, Xxx Xxxxxxx, Xxxxxxxxxx 00000, Attention: Xx. Xxxx X. Xxxxxx,
President; and (b) if to Brighton, at its offices at 0000 Xxxx Xxxxxxx
Xxxxxxxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx 00000, Attention:
Manager.
15. This agreement has been negotiated, executed and delivered
in the State of California. The parties hereto agree that all questions
pertaining to the validity and interpretation of this agreement shall be
determined in accordance with the laws of the State of California.
16. This Agreement incorporates the entire understanding of the
parties and supersedes all previous agreements and/or discussions
between Brighton and the Company; may not be amended or modified except
in writing, executed by the Company and Brighton
17. The parties agree to execute such further instruments and to
take such further action as may reasonably be necessary to carry out the
intent of this Agreement.
18. This Agreement may be executed simultaneously in one or more
counterparts, each of which shall be deemed to be an original, but all
of which together shall constitute the same instrument.
19. No party shall hold itself out as an agent, joint venturer
or partner of another party or of any entity controlled directly or
indirectly by or affiliated with another party.
If the foregoing correctly sets forth the understanding and
agreement between Brighton and the Company, please sign this Agreement
below and return the executed duplicate of this Agreement attached
hereto, whereupon this Agreement shall be binding and enforceable in
accordance with its terms.
Sincerely,
Brighton Street Advisory, L.L.C.
By:
Xxxx X. Xxxxxx, Manager and
CEO
Accepted and agreed to
this day of January, 2001
ACCELACORP 1, INC.
By:
Xxxx X. Xxxxxx, President
