CONFIDENTIAL
June 24,
2010
CONFIDENTIAL
000
Xxxxxxxxx Xxxxxx
Xxxxx
000
Xxx Xxxx,
Xxx Xxxx 00000
Attn: Xx.
Xxxxx X. Xxxxx
Dear Xx.
Xxxxx:
This
letter (the “Agreement”)
constitutes the agreement between Xxxxxx & Xxxxxxx, LLC (“Xxxxxx” or the “Placement Agent”) and
Neostem, Inc. (the “Company”), that
Xxxxxx shall serve as the exclusive placement agent for the Company, on a
reasonable best efforts basis, in connection with the proposed placement (the
“Placement”) of
registered securities (the “Securities”) of the
Company, including, but not limited to, shares (the “Shares”) of the
Company’s common stock, par value $0.001 per share (the “Common Stock”). The
terms of such Placement and the Securities shall be mutually agreed upon by the
Company and the purchasers (each, a “Purchaser” and
collectively, the “Purchasers”) and
nothing herein constitutes that Xxxxxx would have the power or authority to bind
the Company or any Purchaser or an obligation for the Company to issue any
Securities or complete the Placement. This Agreement and the documents executed
and delivered by the Company and the Purchasers in connection with the Placement
shall be collectively referred to herein as the “Transaction
Documents.” The date of the closing of the Placement shall be
referred to herein as the “Closing
Date.” The Company expressly acknowledges and agrees that
Xxxxxx’x obligations hereunder are on a reasonable best efforts basis only and
that the execution of this Agreement does not constitute a commitment by Xxxxxx
to purchase the Securities and does not ensure the successful placement of the
Securities or any portion thereof or the success of Xxxxxx with respect to
securing any other financing on behalf of the Company.
SECTION
1. COMPENSATION AND OTHER
FEES.
As
compensation for the services provided by Xxxxxx hereunder, the Company agrees
to pay to Xxxxxx:
(A) The
fees set forth below with respect to the Placement:
1. A cash
fee payable immediately upon the closing of the Placement and equal to 6% of the
aggregate
gross proceeds raised in the Placement.
2. Such
number of warrants (the “Xxxxxx Warrants”) to
Xxxxxx or its designees at the Closing to purchase shares of Common Stock equal
to 4% of the aggregate number of Shares sold in the Placement. The
Xxxxxx Warrants shall have the same terms as the warrants (if any) issued to the
Purchasers in the Placement except that the exercise price shall be 125% of the
public offering price per share and the expiration date shall be five years from
the effective date of the shelf registration statement referred to in Section
2(A) below. The Xxxxxx Warrants shall not be transferable for six
months from the date of the Offering except as permitted by FINRA Rule 5110, and
further, the number of Shares underlying the Xxxxxx Warrants shall be reduced if
necessary to comply with FINRA rules or regulations.
Xxxxxx
& Xxxxxxx, LLC 1251 Avenue of the Xxxxxxxx, 00xx Xxxxx,
Xxx Xxxx, XX 00000
Tel:
000 000 0000 Fax: 000 000 0000 xxx.xxxx.xxx
Member: FINRA, SIPC
(B) Subject to
compliance with FINRA Rule 5110(f)(2)(D), the Company also agrees to reimburse
Xxxxxx’x non-accountable expenses equal to the lesser of (1) 0.8% of the
aggregate gross proceeds raised in the placement and (2) $40,000 (provided, however, that such expense cap in
no way limits or impairs the indemnification and contribution provisions of this
Agreement). Such reimbursement shall be payable immediately
upon (but only in the event of) the closing of the Placement.
SECTION
2. REGISTRATION
STATEMENT.
The
Company represents and warrants to, and agrees with, the Placement Agent
that:
(A) The
Company has filed with the Securities and Exchange Commission (the “Commission”) a
registration statement on Form S-3 (Registration File No. 333-166169) under the
Securities Act of 1933, as amended (the “Securities Act”),
which became effective on May 11, 2010, for the registration under the
Securities Act of the Shares. At the time of such filing, the Company met the
requirements of Form S-3 under the Securities Act. Such registration
statement meets the requirements set forth in Rule 415(a)(1)(x) under the
Securities Act and complies with said Rule. The Company will file with the
Commission pursuant to Rule 424(b) under the Securities Act, and the rules and
regulations (the “Rules and
Regulations”) of the Commission promulgated thereunder, a supplement to
the form of prospectus included in such registration statement relating to the
placement of the Shares and the plan of distribution thereof and has advised the
Placement Agent of all further information (financial and other) with respect to
the Company required to be set forth therein. Such registration statement,
including the exhibits thereto, as amended at the date of this Agreement, is
hereinafter called the “Registration
Statement”; such prospectus in the form in which it appears in the
Registration Statement is hereinafter called the “Base Prospectus”; and
the supplemented form of prospectus, in the form in which it will be filed with
the Commission pursuant to Rule 424(b) (including the Base Prospectus as so
supplemented) is hereinafter called the “Prospectus
Supplement.” Any reference in this Agreement to the Registration
Statement, the Base Prospectus or the Prospectus Supplement shall be deemed to
refer to and include the documents incorporated by reference therein (the “Incorporated
Documents”) pursuant to Item 12 of Form S-3 which were filed under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), on or before
the date of this Agreement, or the issue date of the Base Prospectus or the
Prospectus Supplement, as the case may be; and any reference in this Agreement
to the terms “amend,” “amendment” or “supplement” with respect to the
Registration Statement, the Base Prospectus or the Prospectus Supplement shall
be deemed to refer to and include the filing of any document under the Exchange
Act after the date of this Agreement, or the issue date of the Base Prospectus
or the Prospectus Supplement, as the case may be, deemed to be incorporated
therein by reference. All references in this Agreement to financial statements
and schedules and other information that is “contained,” “included,”
“described,” “referenced,” “set forth” or “stated” in the Registration
Statement, the Base Prospectus or the Prospectus Supplement (and all other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information that is or is deemed to
be incorporated by reference in the Registration Statement, the Base Prospectus
or the Prospectus Supplement, as the case may be. No stop order
suspending the effectiveness of the Registration Statement or the use of the
Base Prospectus or the Prospectus Supplement has been issued, and no proceeding
for any such purpose is pending or has been initiated or, to the Company's
knowledge, is threatened by the Commission. For purposes of this Agreement,
“free writing
prospectus” has the meaning set forth in Rule 405 under the Securities
Act and the “Time of
Sale Prospectus” means the preliminary prospectus, if any, together with
the free writing prospectuses, if any, used in connection with the Placement,
including any documents incorporated by reference therein.
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(B) The
Registration Statement (and any further documents to be filed with the
Commission) contains all exhibits and schedules as required by the Securities
Act. Each of the Registration Statement and any post-effective amendment
thereto, at the time it became effective, complied in all material respects with
the Securities Act and the Exchange Act and the applicable Rules and Regulations
and did not and, as amended or supplemented, if applicable, will not, contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading. The Base Prospectus, the Time of Sale Prospectus, if any, and the
Prospectus Supplement, each as of its respective date, comply in all material
respects with the Securities Act and the Exchange Act and the applicable Rules
and Regulations. Each of the Base Prospectus, the Time of Sale Prospectus, if
any, and the Prospectus Supplement, as amended or supplemented, did not and will
not contain as of the date thereof any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading. The
Incorporated Documents, when they were filed with the Commission, conformed in
all material respects to the requirements of the Exchange Act and the applicable
Rules and Regulations, and none of such documents, when they were filed with the
Commission, contained any untrue statement of a material fact or omitted to
state a material fact necessary to make the statements therein (with respect to
Incorporated Documents incorporated by reference in the Base Prospectus or
Prospectus Supplement), in light of the circumstances under which they were made
not misleading; and any further documents so filed and incorporated by reference
in the Base Prospectus, the Time of Sale Prospectus, if any, or Prospectus
Supplement, when such documents are filed with the Commission, will conform in
all material respects to the requirements of the Exchange Act and the applicable
Rules and Regulations, as applicable, and will not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. No post-effective amendment to the Registration Statement
reflecting any facts or events arising after the date thereof which represent,
individually or in the aggregate, a fundamental change in the information set
forth therein is required to be filed with the Commission. There are
no documents required to be filed with the Commission in connection with the
transaction contemplated hereby that (x) have not been filed as required
pursuant to the Securities Act or (y) will not be filed within the requisite
time period. There are no contracts or other documents required to be described
in the Base Prospectus, the Time of Sale Prospectus, if any, or Prospectus
Supplement, or to be filed as exhibits or schedules to the Registration
Statement, that have not been described or filed as required.
(C) The
Company is eligible to use free writing prospectuses in connection with the
Placement pursuant to Rules 164 and 433 under the Securities Act. Any
free writing prospectus that the Company is required to file pursuant to Rule
433(d) under the Securities Act has been, or will be, filed with the Commission
in accordance with the requirements of the Securities Act and the applicable
rules and regulations of the Commission thereunder. Each free writing
prospectus that the Company has filed, or is required to file, pursuant to Rule
433(d) under the Securities Act or that was prepared by or behalf of or used by
the Company complies or will comply in all material respects with the
requirements of the Securities Act and the applicable rules and regulations of
the Commission thereunder. The Company will not, without the prior
consent of the Placement Agent, prepare, use or refer to, any free writing
prospectus.
(D) The
Company has delivered, or will as promptly as practicable deliver, to the
Placement Agent complete conformed copies of the Registration Statement and of
each consent and certificate of experts, as applicable, filed as a part thereof,
and conformed copies of the Registration Statement (without exhibits), the Base
Prospectus, the Time of Sale Prospectus, if any, and the Prospectus Supplement,
as amended or supplemented, in such quantities and at such places as the
Placement Agent reasonably requests. Neither the Company nor any of
its directors and officers has distributed and none of them will distribute,
prior to the Closing Date, any offering material in connection with the offering
and sale of the Shares other than the Base Prospectus, the Time of Sale
Prospectus, if any, the Prospectus Supplement, the Registration Statement,
copies of the documents incorporated by reference therein and any other
materials permitted by the Securities Act.
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SECTION
3. REPRESENTATIONS AND
WARRANTIES. The Company hereby makes the representations and warranties
set forth below to the Placement Agent:
(A) Organization and
Qualification. All of the active direct and indirect
subsidiaries (individually, a “Subsidiary”) of the
Company are set forth on the Incorporated Documents. The Company
owns, directly or indirectly, all of the capital stock or other equity interests
of each United States Subsidiary free and clear of any “Liens” (which for
purposes of this Agreement shall mean a lien, charge, security interest,
encumbrance or other restriction), and all the issued and outstanding shares of
capital stock of each Subsidiary are validly issued and are fully paid,
non-assessable and free of preemptive and similar rights to subscribe for or
purchase securities. The Company and each of the Subsidiaries is an
entity duly incorporated or otherwise organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or organization
(as applicable), with the requisite power and authority to own and use its
properties and assets and to carry on its business as currently
conducted. Neither the Company nor any Subsidiary is in material
violation or default of any of the provisions of its respective certificate or
articles of incorporation, bylaws or other organizational or charter
documents. Each of the Company and the Subsidiaries is duly qualified
to conduct business and is in good standing as a foreign corporation or other
entity in each jurisdiction in which the nature of the business conducted or
property owned by it makes such qualification necessary, except where the
failure to be so qualified or in good standing, as the case may be, could not
have or reasonably be expected to result in (i) a material adverse effect on the
legality, validity or enforceability of any Transaction Document, (ii) a
material adverse effect on the results of operations, assets, business,
prospects or condition (financial or otherwise) of the Company and the
Subsidiaries, taken as a whole, or (iii) a material adverse effect on the
Company’s ability to perform in any material respect on a timely basis its
obligations under any Transaction Document (any of (i), (ii) or (iii), a
“Material Adverse Effect”) and no “Proceeding” (which for purposes of this
Agreement shall mean any action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened) has been instituted in any such
jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or
curtail such power and authority or qualification.
(B) Authorization;
Enforcement. The Company has the requisite corporate power and
authority to enter into and to consummate the transactions contemplated by each
of the Transaction Documents and otherwise to carry out its obligations
hereunder and thereunder. The execution and delivery of each of the
Transaction Documents by the Company and the consummation by it of the
transactions contemplated thereby have been or will be duly authorized by all
necessary action on the part of the Company and no further action will be
required by the Company, its board of directors or its stockholders in
connection therewith other than in connection with filings as are required to be
made under applicable Federal and state securities laws (the “Required
Approvals”). Each Transaction Document has been (or upon
delivery will have been) duly executed by the Company and, when delivered in
accordance with the terms hereof and thereof, will constitute the valid and
binding obligation of the Company enforceable against the Company in accordance
with its terms except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting
enforcement of creditors’ rights generally and (ii) as limited by laws relating
to the availability of specific performance, injunctive relief or other
equitable remedies.
(C) No
Conflicts. The execution, delivery and performance of the
Transaction Documents by the Company, the issuance and sale of the Securities
and the consummation by the Company of the other transactions contemplated
hereby and thereby do not and will not (i) conflict with or violate any
provision of the Company’s or any Subsidiary’s certificate or articles of
incorporation, bylaws or other organizational or charter documents, or (ii)
conflict with, or constitute a default (or an event that with notice or lapse of
time or both would become a default) under, result in the creation of any Lien
upon any of the properties or assets of the Company or any Subsidiary, or give
to others any rights of termination, amendment, acceleration or cancellation
(with or without notice, lapse of time or both) of, any agreement, credit
facility, debt or other instrument (evidencing a Company or Subsidiary debt or
otherwise) or other understanding to which the Company or any Subsidiary is a
party or by which any property or asset of the Company or any Subsidiary is
bound or affected, or (iii) subject to the Required Approvals, conflict with or
result in a violation of any law, rule, regulation, order, judgment, injunction,
decree or other restriction of any court or governmental authority to which the
Company or a Subsidiary is subject (including federal and state securities laws
and regulations), or by which any property or asset of the Company or a
Subsidiary is bound or affected; except in the case of each of clauses (ii) and
(iii), such as could not have or reasonably be expected to result in a Material
Adverse Effect.
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(D) Certain
Fees. Except as otherwise provided in this Agreement, no
brokerage or finder’s fees or commissions are or will be payable by the Company
to any broker, financial advisor or consultant, finder, placement agent,
investment banker, bank or other individual or corporation, partnership, trust,
incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof)
or other entity of any kind, including, without limitation, the NYSE AMEX (each,
a “Person”)
with respect to the transactions contemplated by the Transaction
Documents. The Purchasers shall have no obligation with respect to
any fees or with respect to any claims made by or on behalf of other Persons for
fees of a type contemplated in this Section that may be due in connection with
the transactions contemplated by the Transaction Documents.
(E) FINRA
Affiliations. There are no affiliations with any FINRA member
firm among the Company’s officers, directors or, to the knowledge of the
Company, any five percent (5%) or greater stockholder of the Company, except as
set forth in the Base Prospectus.
(F) Reliance on Transaction
Documents. Xxxxxx shall be entitled to rely upon any and all
representations and warranties of the Company included in the purchase
agreements entered into by the Company and the Purchasers in connection with the
Placement, subject to the qualifications and limitations therein.
SECTION
4. ENGAGEMENT
TERM. Xxxxxx'x engagement hereunder will be for the period of
5 days. The engagement may be terminated by either the Company or
Xxxxxx at any time upon 48 hours' prior written notice. Notwithstanding anything
to the contrary contained herein, the provisions in this Agreement concerning
confidentiality, indemnification and contribution will survive any expiration or
termination of this Agreement. Upon any termination of this
Agreement, the Company's obligation to pay Xxxxxx any fees actually earned on
closing of the Offering and otherwise payable under Section 1(A), shall survive
any expiration or termination of this Agreement, as permitted by FINRA Rule
5110(f)(2)(d). Upon any termination of this Agreement, the Company's
obligation to reimburse Xxxxxx for out of pocket accountable expenses actually
incurred by Xxxxxx and reimbursable upon closing of the Offering pursuant to
Section 1(B), if any are otherwise due under Section 1(B) hereof, will survive
any expiration or termination of this Agreement, as permitted by FINRA Rule
5110(f)(2)(d).
SECTION
5. XXXXXX
INFORMATION. The Company agrees that any information or advice
rendered by Xxxxxx in connection with this engagement is for the confidential
use of the Company only in their evaluation of the Placement and, except as
otherwise required by law, the Company will not disclose or otherwise refer to
the advice or information in any manner without Xxxxxx’x prior written
consent.
5
SECTION
6. NO FIDUCIARY
RELATIONSHIP. This Agreement does not create, and shall not be
construed as creating rights enforceable by any person or entity not a party
hereto, except those entitled hereto by virtue of the indemnification provisions
hereof. The Company acknowledges and agrees that Xxxxxx is not and
shall not be construed as a fiduciary of the Company and shall have no duties or
liabilities to the equity holders or the creditors of the Company or any other
person by virtue of this Agreement or the retention of Xxxxxx hereunder, all of
which are hereby expressly waived.
SECTION
7. CLOSING. The
obligations of the Placement Agent and the Purchasers, and the closing of the
sale of the Securities hereunder are subject to the accuracy, when made and on
the Closing Date, of the representations and warranties on the part of the
Company and its Subsidiaries contained herein, to the accuracy of the statements
of the Company and its Subsidiaries made in any certificates pursuant to the
provisions hereof, to the performance by the Company and its Subsidiaries of
their obligations hereunder, and to each of the following additional terms and
conditions:
(A) No
stop order suspending the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have been initiated or
threatened by the Commission, and any request for additional information on the
part of the Commission (to be included in the Registration Statement, the Base
Prospectus or the Prospectus Supplement or otherwise) shall have been complied
with to the reasonable satisfaction of the Placement Agent.
(B) The
Placement Agent shall not have discovered and disclosed to the Company on or
prior to the Closing Date that the Registration Statement, the Base Prospectus
or the Prospectus Supplement or any amendment or supplement thereto contains an
untrue statement of a fact which, in the opinion of counsel for the Placement
Agent, is material or omits to state any fact which, in the opinion of such
counsel, is material and is required to be stated therein or is necessary to
make the statements therein not misleading.
(C) All
corporate proceedings and other legal matters incident to the authorization,
form, execution, delivery and validity of each of this Agreement, the
Securities, the Registration Statement, the Base Prospectus and the Prospectus
Supplement and all other legal matters relating to this Agreement and the
transactions contemplated hereby shall be reasonably satisfactory in all
material respects to counsel for the Placement Agent, and the Company shall have
furnished to such counsel all documents and information that they may reasonably
request to enable them to pass upon such matters.
(D) The
Placement Agent shall have received from counsel to the Company such counsel’s
written opinion, addressed to the Placement Agent and the Purchasers dated as of
the Closing Date, in form and substance reasonably satisfactory to the Placement
Agent, which opinion shall include a “10b-5” representation from such
counsel.
(E) Neither
the Company nor any of its Subsidiaries shall have sustained since the date of
the latest audited financial statements included or incorporated by reference in
the Base Prospectus, any loss or interference with its business from fire,
explosion, flood, terrorist act or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action, order or
decree, otherwise than as set forth in or contemplated by the Base Prospectus
and (ii) since such date there shall not have been any change in the capital
stock or long-term debt of the Company or any of its Subsidiaries or any change,
or any development involving a prospective change, in or affecting the business,
general affairs, management, financial position, stockholders’ equity, results
of operations or prospects of the Company and its Subsidiaries, otherwise than
as set forth in or contemplated by the Base Prospectus, the effect of which, in
any such case described in clause (i) or (ii), is, in the judgment of the
Placement Agent, so material and adverse as to make it impracticable or
inadvisable to proceed with the sale or delivery of the Securities on the terms
and in the manner contemplated by the Base Prospectus, the Time of Sale
Prospectus, if any, and the Prospectus Supplement.
6
(F) The
Common Stock is registered under the Exchange Act and, as of the Closing Date,
the Shares shall be listed and admitted and authorized for trading on the AMEX
NYSE (the “Trading
Market”), and satisfactory evidence of such actions shall have been
provided to the Placement Agent. The Company shall have taken no
action designed to, or likely to have the effect of terminating the registration
of the Common Stock under the Exchange Act or delisting or suspending from
trading the Common Stock from the Trading Market, nor has the Company received
any information suggesting that the Commission or the Trading Market is
contemplating terminating such registration or listing.
(G) Subsequent
to the execution and delivery of this Agreement, there shall not have occurred
any of the following: (i) trading in securities generally on the New York Stock
Exchange, the Nasdaq National Market or the NYSE Alternext US or in the
over-the-counter market, or trading in any securities of the Company on any
exchange or in the over-the-counter market, shall have been suspended or minimum
or maximum prices or maximum ranges for prices shall have been established on
any such exchange or such market by the Commission, by such exchange or by any
other regulatory body or governmental authority having jurisdiction, (ii) a
banking moratorium shall have been declared by federal or state authorities or a
material disruption has occurred in commercial banking or securities settlement
or clearance services in the United States, (iii) the United States shall have
become engaged in hostilities in which it is not currently engaged, the subject
of an act of terrorism, there shall have been an escalation in hostilities
involving the United States, or there shall have been a declaration of a
national emergency or war by the United States, or (iv) there shall have
occurred any other calamity or crisis or any change in general economic,
political or financial conditions in the United States or elsewhere, if the
effect of any such event in clause (iii) or (iv) makes it, in the sole judgment
of the Placement Agent, impracticable or inadvisable to proceed with the sale or
delivery of the Securities on the terms and in the manner contemplated by the
Base Prospectus and the Prospectus Supplement.
(H) No
action shall have been taken and no statute, rule, regulation or order shall
have been enacted, adopted or issued by any governmental agency or body which
would, as of the Closing Date, prevent the issuance or sale of the Securities or
materially and adversely affect or potentially and adversely affect the business
or operations of the Company; and no injunction, restraining order or order of
any other nature by any federal or state court of competent jurisdiction shall
have been issued as of the Closing Date which would prevent the issuance or sale
of the Securities or materially and adversely affect or potentially and
adversely affect the business or operations of the Company.
(I) The
Company shall have prepared and filed with the Commission a Current Report on
Form 8-K with respect to the Placement, including as an exhibit thereto this
Agreement.
(J) The
Company shall have entered into subscription agreements with each of the
Purchasers and such agreements shall be in full force and effect and shall
contain representations and warranties of the Company as agreed between the
Company and the Purchasers.
(K) FINRA
shall have raised no objection to the fairness and reasonableness of the terms
and arrangements of this Agreement.
(L) Prior
to the Closing Date, the Company shall have furnished to the Placement Agent
such further information, certificates and documents as the Placement Agent may
reasonably request.
7
All
opinions, letters, evidence and certificates mentioned above or elsewhere in
this Agreement shall be deemed to be in compliance with the provisions hereof
only if they are in form and substance reasonably satisfactory to counsel for
the Placement Agent.
SECTION
8. INDEMNIFICATION. (A) To
the extent permitted by law, the Company will indemnify Xxxxxx and its
affiliates, stockholders, directors, officers, employees and controlling persons
(within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act) against all losses, claims, damages, expenses and liabilities, as
the same are incurred (including the reasonable fees and expenses of counsel),
relating to or arising out of its activities hereunder or pursuant to this
engagement letter, except to the extent that any losses, claims, damages,
expenses or liabilities (or actions in respect thereof) are found in a final
judgment (not subject to appeal) by a court of law to have resulted primarily
and directly from Xxxxxx’x willful misconduct or gross negligence in performing
the services described herein.
(B) Promptly
after receipt by Xxxxxx of notice of any claim or the commencement of any action
or proceeding with respect to which Xxxxxx is entitled to indemnity hereunder,
Xxxxxx will notify the Company in writing of such claim or of the commencement
of such action or proceeding, but failure to so notify the Company shall not
relieve the Company from any obligation it may have hereunder, except and only
to the extent such failure results in the forfeiture by the Company of
substantial rights and defenses. If the Company so elects or is
requested by Xxxxxx, the Company will assume the defense of such action or
proceeding and will employ counsel reasonably satisfactory to Xxxxxx and will
pay the fees and expenses of such counsel. Notwithstanding the
preceding sentence, Xxxxxx will be entitled to employ counsel separate from
counsel for the Company and from any other party in such action if counsel for
Xxxxxx reasonably determines that it would be inappropriate under the applicable
rules of professional responsibility for the same counsel to represent both the
Company and Xxxxxx. In such event, the reasonable fees and
disbursements of no more than one such separate counsel will be paid by the
Company, in addition to local counsel. The Company will have the
exclusive right to settle the claim or proceeding provided that the Company will
not settle any such claim, action or proceeding without the prior written
consent of Xxxxxx, which will not be unreasonably withheld.
(C) The
Company agrees to notify Xxxxxx promptly of the assertion against it or any
other person of any claim or the commencement of any action or proceeding
relating to a transaction contemplated by this engagement letter.
(D) If
for any reason the foregoing indemnity is unavailable to Xxxxxx or insufficient
to hold Xxxxxx harmless, then the Company shall contribute to the amount paid or
payable by Xxxxxx as a result of such losses, claims, damages or liabilities in
such proportion as is appropriate to reflect not only the relative benefits
received by the Company on the one hand and Xxxxxx on the other, but also the
relative fault of the Company on the one hand and Xxxxxx on the other that
resulted in such losses, claims, damages or liabilities, as well as any relevant
equitable considerations. The amounts paid or payable by a party in
respect of losses, claims, damages and liabilities referred to above shall be
deemed to include any legal or other fees and expenses incurred in defending any
litigation, proceeding or other action or claim. Notwithstanding the
provisions hereof, Xxxxxx’x share of the liability hereunder shall not be in
excess of the amount of fees actually received, or to be received, by Xxxxxx
under this engagement letter (excluding any amounts received as reimbursement of
expenses incurred by Xxxxxx).
(E) These
indemnification provisions shall remain in full force and effect whether or not
the transaction contemplated by this engagement letter is completed and shall
survive the termination of this engagement letter, and shall be in addition to
any liability that the Company might otherwise have to any indemnified party
under this engagement letter or otherwise.
8
SECTION
9. GOVERNING
LAW. This Agreement will be governed by, and construed in
accordance with, the laws of the State of New York applicable to agreements made
and to be performed entirely in such State. This Agreement may not be
assigned by either party without the prior written consent of the other
party. This Agreement shall be binding upon and inure to the benefit
of the parties hereto, and their respective successors and permitted assigns.
Any right to trial by jury with respect to any dispute arising under this
Agreement or any transaction or conduct in connection herewith is
waived. Any dispute arising under this Agreement may be brought into
the courts of the State of New York or into the Federal Court located in New
York, New York and, by execution and delivery of this Agreement, the Company
hereby accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of aforesaid courts. Each party
hereto hereby irrevocably waives personal service of process and consents to
process being served in any such suit, action or proceeding by delivering a copy
thereof via overnight delivery (with evidence of delivery) to such party at the
address in effect for notices to it under this Agreement and agrees that such
service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way
any right to serve process in any manner permitted by law. If either party shall
commence an action or proceeding to enforce any provisions of a Transaction
Document, then the prevailing party in such action or proceeding shall be
reimbursed by the other party for its attorneys’ fees and other costs and
expenses incurred with the investigation, preparation and prosecution of such
action or proceeding.
SECTION
10. ENTIRE
AGREEMENT/MISC. This Agreement embodies the entire agreement
and understanding between the parties hereto, and supersedes all prior
agreements and understandings, relating to the subject matter
hereof. If any provision of this Agreement is determined to be
invalid or unenforceable in any respect, such determination will not affect such
provision in any other respect or any other provision of this Agreement, which
will remain in full force and effect. This Agreement may not be
amended or otherwise modified or waived except by an instrument in writing
signed by both Xxxxxx and the Company. The representations,
warranties, agreements and covenants contained herein shall survive the closing
of the Placement and delivery and/or exercise of the Securities, as
applicable. This Agreement may be executed in two or more
counterparts, all of which when taken together shall be considered one and the
same agreement and shall become effective when counterparts have been signed by
each party and delivered to the other party, it being understood that both
parties need not sign the same counterpart. In the event that any
signature is delivered by facsimile transmission or a .pdf format file, such
signature shall create a valid and binding obligation of the party executing (or
on whose behalf such signature is executed) with the same force and effect as if
such facsimile or .pdf signature page were an original thereof.
SECTION
11. NOTICES. Any
and all notices or other communications or deliveries required or permitted to
be provided hereunder shall be in writing and shall be deemed given and
effective on the earliest of (a) the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number specified on
the signature pages attached hereto prior to 6:30 p.m. (New York City time) on a
business day, (b) the next business day after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number on
the signature pages attached hereto on a day that is not a business day or later
than 6:30 p.m. (New York City time) on any business day, (c) the business day
following the date of mailing, if sent by U.S. nationally recognized overnight
courier service, or (d) upon actual receipt by the party to whom such notice is
required to be given. The address for such notices and communications
shall be as set forth on the signature pages hereto.
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Please
confirm that the foregoing correctly sets forth our agreement by signing and
returning to Xxxxxx a copy of this Agreement.
Very
truly yours,
XXXXXX
& XXXXXXX, LLC
|
|||
By:
|
/s/
Xxxx Xxxxx
|
||
Name: Xxxx Xxxxx | |||
Title: Senior Managing Director | |||
Address for
notice:
0000
Xxxxxx xx xxx Xxxxxxxx, 00xx Xxxxx
Xxx
Xxxx, XX, 00000
Fax
(000) 000-0000
Attention: General
Counsel
|
|||
By:
|
/s/
Xxxxx X. Xxxxx
|
||
Name: Xxxxx X. Xxxxx | |||
Title: Chief
Executive Officer
|
|||
Address for
notice:
000
Xxxxxxxxx Xxxxxx
Xxxxx
000
Xxx
Xxxx, Xxx Xxxx 00000
|
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