Exhibit 10.13
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CONDOR CAPITAL INC.
PLACEMENT AGENT AGREEMENT
Dated as of: December 4, 2000
May Xxxxx Group, Inc.
Xxx Xxxxx Xxxxx Xxxxxx - Xxxxx 0000
Xxx Xxxx, Xxx Xxxx, 00000
Ladies and Gentlemen:
The undersigned, Condor Capital Inc., (the "Company"), hereby agrees with
May Xxxxx Group, Inc. ("May Xxxxx") as follows:
1. Offering.
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The Company hereby engages May Xxxxx to act as its exclusive placement
agent in connection with the Credit Agreement (as defined herein) for the
issuance and sale by the Company (the "Offering") of the Company's Common Stock,
$0.001 par value per share (the "Common Stock"), at a price per share equal to
the Purchase Price, as that term is defined in the Equity Line of Credit
Agreement dated the date hereof between the Company and the investor named
therein ( the "Credit Agreement"), for an aggregate price of up to $10,000,000.
All capitalized terms used herein and not otherwise defined shall have the same
meaning ascribed to them as in the Credit Agreement. The Investor will be
granted certain registration rights with respect to the Common Stock as more
fully set forth in the Registration Rights Agreement between the Company and the
Investor dated the date hereof, and May Xxxxx will be granted common stock of
the Company described herein. The documents to be executed and delivered in
connection with the Offering, including but not limited to this Agreement, the
Credit Agreement, the Registration Rights Agreement, the Escrow Agreement, (as
hereinafter defined) are referred to sometimes hereinafter collectively as the
"Offering Materials." The Company's Common Stock and there are sometimes
referred to hereinafter collectively as the "Securities." May Xxxxx shall not be
obligated to sell any Securities and this Offering by May Xxxxx shall be solely
on a "best efforts basis."
2. Information.
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A. Upon the occurrence of each Closing, the funds received in respect of
the shares of Common Stock purchased by the Investor will be disbursed in
accordance with the terms of the Credit Agreement, net of (i) legal fees and
other expenses related thereto due at the initial Closing to May Xxxxx'x counsel
in the amount of Twenty Five Thousand Dollars ($25,000).
B. In addition to the foregoing compensation, the Company pay to May Xxxxx
upon the execution of the Credit Agreement the following: (i) restricted Common
Stock compensation in the amount of three percent (3%) of the total amount of
the Credit Agreement. May Xxxxx shall be entitled to certain demand registration
rights with respect to the restricted shares of Common Stock pursuant to a
registration rights agreement in substantially the same form annexed hereto (the
"Registration Rights Agreement");(ii) May Xxxxx shall receive as cash
compensation an amount equal to five percent (5%) of the gross proceeds of each
advance to the Company pursuant to the Credit Agreement.
3. Representations, Warranties and Covenants of May Xxxxx.
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A. May Xxxxx represents, warrants and covenants as follows:
(i) May Xxxxx has the necessary power to enter into this Agreement,
the and to consummate the transactions contemplated hereby and thereby.
(ii) The execution and delivery by May Xxxxx of this Agreement, and
the consummation of the transactions contemplated herein and therein will
not result in any violation of, or be in conflict with, or constitute a
default under, any agreement or instrument to which May Xxxxx is a party or
by which May Xxxxx or its properties are bound, or any judgment, decree,
order or, to May Xxxxx'x knowledge, any statute, rule or regulation
applicable to May Xxxxx. This Agreement, executed and delivered by May
Xxxxx, xxxx constitute the legal, valid and binding obligations of May
Xxxxx, enforceable in accordance with their respective terms, except to the
extent that (a) the enforceability hereof or thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws from
time to time in effect and affecting the rights of creditors generally, (b)
the enforceability hereof or thereof is subject to general principles of
equity, or (c) the indemnification provisions hereof or thereof may be held
to be violative of public policy.
(iii)Upon receipt of an executed Credit Agreement, a Registration
Rights Agreement and Escrow Agreement and the documents related thereto,
May Xxxxx will, through the Escrow Agent, promptly forward copies of the
Credit Agreement, Registration Rights Agreement and Escrow Agreement and
the documents related thereto to the Company or its counsel.
(iv) May Xxxxx will not deliver any documents related to the Offering
to any person it does not reasonably believe to be an Accredited Investor.
(v) May Xxxxx will not intentionally take any action that it
reasonably believes would cause the Offering to violate the provisions of
the 1933 Act, the 1934 Act, the respective rules and regulations
promulgated there under (the "Rules and Regulations") or applicable "Blue
Sky" laws of any state or jurisdiction.
(vi) May Xxxxx shall use all reasonable efforts to determine (a)
whether the Investor is an Accredited Investor and (b) that any information
furnished by the Investor is true and accurate. May Xxxxx shall have no
obligation to insure that (x) any check, note, draft or other means of
payment for the Common Stock will be honored, paid or enforceable against
the Investor in accordance with its terms, or (y) subject to the
performance of May Xxxxx'x obligations and the accuracy of May Xxxxx'x
representations and warranties hereunder, (1) the Offering is exempt from
the registration requirements of the 1933 Act or any applicable state "Blue
Sky" law or (2) the Investor is an Accredited Investor.
(vii) May Xxxxx is a member of the National Association of Securities
Dealers, Inc., and is a broker-dealer registered as such under the 1934 Act
and under the securities laws of the states in which the Securities will be
offered or sold by May Xxxxx, unless an exemption for such state
registration is available to May Xxxxx. May Xxxxx is in compliance with all
material rules and regulations applicable to May Xxxxx generally and
applicable to May Xxxxx'x participation in the Offering.
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4. Representations and Warranties of the Company.
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A. The Company represents and warrants as follows:
(i) The execution, delivery and performance of each of this Agreement,
the Credit Agreement, the Escrow Agreement, and the Investor's Registration
Rights Agreement has been or will be duly and validly authorized by the
Company and is, or with respect to this Agreement, the Credit Agreement,
the Escrow Agreement, and the Investor's Registration Rights Agreement will
be, a valid and binding agreement of the Company, enforceable in accordance
with its respective terms, except to the extent that (a) the enforceability
hereof or thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws from time to time in effect and affecting the
rights of creditors generally, (b) the enforceability hereof or thereof is
subject to general principles of equity or (c) the indemnification
provisions hereof or thereof may be held to be violative of public policy.
The Securities to be issued pursuant to the transactions contemplated by
this Agreement, the Credit Agreement have been duly authorized and, when
issued and paid for in accordance with (x) this Agreement, the Credit
Agreement and the certificates/instruments representing such Securities,
(y) will be valid and binding obligations of the Company, enforceable in
accordance with their respective terms, except to the extent that (1) the
enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws from time to time in effect and
affecting the rights of creditors generally, and (2) the enforceability
thereof is subject to general principles of equity. All corporate action
required to be taken for the authorization, issuance and sale of the
Securities has been duly and validly taken by the Company.
(ii) The Company has a duly authorized, issued and outstanding
capitalization as set forth in the Credit Agreement. The Company is not a
party to or bound by any instrument, agreement or other arrangement
providing for it to issue any capital stock, rights, warrants, options or
other securities, except for this Agreement and the agreements described
herein and as described in the Credit Agreement. All issued and outstanding
securities of the Company, have been duly authorized and validly issued and
are fully paid and non-assessable; the holders thereof have no rights of
rescission or preemptive rights with respect thereto and are not subject to
personal liability solely by reason of being security holders; and none of
such securities was issued in violation of the preemptive rights of any
holders of any security of the Company. The Company has 100,000,000 shares
of authorized Common Stock, 20,155,010 of which will be issued and
outstanding as of the date hereof.
(iii) The Common Stock to be issued in accordance with Credit
Agreement has been duly authorized and when issued and paid for in
accordance with the this Agreement, the Credit Agreement, and the
certificates/instruments representing such Common Stock, will be validly
issued, fully-paid and non-assessable; the holders thereof will not be
subject to personal liability solely by reason of being such holders; such
securities are not and will not be subject to the preemptive rights of any
holder of any security of the Company.
(iv) The Company has good and marketable title to, or valid and
enforceable leasehold estates in, all items of real and personal property
necessary to conduct its business (including, without limitation any real
or personal property stated in the Offering Materials to be owned or leased
by the Company), free and clear of all liens, encumbrances, claims,
security interests and defects of any material nature whatsoever, other
than those set forth in the Offering Materials and liens for taxes not yet
due and payable.
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(v) There is no litigation or governmental proceeding pending or, to
the best of the Company's knowledge, threatened against, or involving the
properties or business of the Company, except as set forth in the Offering
Materials.
(vi) The Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Nevada. Except
as set forth in the Offering Materials, the Company does not own or
control, directly or indirectly, an interest in any other corporation,
partnership, trust, joint venture or other business entity. The Company is
duly qualified or licensed and in good standing as a foreign corporation in
each jurisdiction in which the character of its operations requires such
qualification or licensing and where failure to so qualify would have a
material adverse effect on the Company. The Company has all requisite
corporate power and authority, and all material and necessary
authorizations, approvals, orders, licenses, certificates and permits of
and from all governmental regulatory officials and bodies (domestic and
foreign) to conduct its businesses (and proposed business) as described in
the Offering Materials. Any disclosures in the Offering Materials
concerning the effects of foreign, federal, state and local regulation on
the Company's businesses as currently conducted and as contemplated are
correct in all material respects and do not omit to state a material fact.
The Company has all corporate power and authority to enter into this
Agreement, the Credit Agreement, the Registration Rights Agreement, the
Escrow Agreement, to carry out the provisions and conditions hereof and
thereof, and all consents, authorizations, approvals and orders required in
connection herewith and therewith have been obtained. No consent,
authorization or order of, and no filing with, any court, government agency
or other body is required by the Company for the issuance of the Securities
or execution and delivery of the Credit Agreement, Registration Rights
Agreement, the Escrow Agreement, except for applicable federal and state
securities laws. The Company, since its inception, has not incurred any
liability arising under or as a result of the application of any of the
provisions of the 1933 Act, the 1934 Act or the Rules and Regulations.
(vii) There has been no material adverse change in the condition or
prospects of the Company, financial or otherwise, from the latest dates as
of which such condition or prospects, respectively, are set forth in the
Offering Materials, and the outstanding debt, the property and the business
of the Company conform in all material respects to the descriptions thereof
contained in the Offering Materials.
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(viii) Except as set forth in the Offering Materials, the Company is
not in breach of, or in default under, any term or provision of any
material indenture, mortgage, deed of trust, lease, note, loan or credit
agreement or any other material agreement or instrument evidencing an
obligation for borrowed money, or any other material agreement or
instrument to which it is a party or by which it or any of its properties
may be bound or affected. The Company is not in violation of any provision
of its charter or by-laws or in violation of any franchise, license,
permit, judgment, decree or order, or in violation of any material statute,
rule or regulation. Neither the execution and delivery of this Agreement,
the Credit Agreement, the Registration Rights Agreement, the Escrow
Agreement, nor the issuance and sale or delivery of the Securities, nor the
consummation of any of the transactions contemplated herein or in the
Credit Agreement, the Registration Rights Agreement, the Escrow Agreement,
nor the compliance by the Company with the terms and provisions hereof or
thereof, has conflicted with or will conflict with, or has resulted in or
will result in a breach of, any of the terms and provisions of, or has
constituted or will constitute a default under, or has resulted in or will
result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or pursuant to the terms of any
indenture, mortgage, deed of trust, note, loan or credit agreement or any
other agreement or instrument evidencing an obligation for borrowed money,
or any other agreement or instrument to which the Company may be bound or
to which any of the property or assets of the Company is subject except (a)
where such default, lien, charge or encumbrance would not have a material
adverse effect on the Company and (b) as described in the Offering
Materials; nor will such action result in any violation of the provisions
of the charter or the by-laws of the Company or, assuming the due
performance by May Xxxxx of its obligations hereunder, any material statute
or any material order, rule or regulation applicable to the Company of any
court or of any foreign, federal, state or other regulatory authority or
other government body having jurisdiction over the Company.
(ix) Subsequent to the dates as of which information is given in the
Offering Materials, and except as may otherwise be indicated or
contemplated herein or therein, the Company has not (a) issued any
securities or incurred any liability or obligation, direct or contingent,
for borrowed money, or (b) entered into any transaction other than in the
ordinary course of business, or (c) declared or paid any dividend or made
any other distribution on or in respect of its capital stock. Except as
described in the Offering Materials, the Company has no outstanding
obligations to any officer or director of the Company.
(x) There are no claims for services in the nature of a finder's or
origination fee with respect to the sale of the Common Stock or any other
arrangements, agreements or understandings that may affect May Xxxxx'x
compensation, as determined by the National Association of Securities
Dealers, Inc.
(xi) The Company owns or possesses, free and clear of all liens or
encumbrances and rights thereto or therein by third parties, the requisite
licenses or other rights to use all trademarks, service marks, copyrights,
service names, trade names, patents, patent applications and licenses
necessary to conduct its business (including, without limitation, any such
licenses or rights described in the Offering Materials as being owned or
possessed by the Company) and, except as set forth in the Offering
Materials, there is no claim or action by any person pertaining to, or
proceeding, pending or threatened, which challenges the exclusive rights of
the Company with respect to any trademarks, service marks, copyrights,
service names, trade names, patents, patent applications and licenses used
in the conduct of the Company's businesses (including, without limitation,
any such licenses or rights described in the Offering Materials as being
owned or possessed by the Company) except any claim or action that would
not have a material adverse effect on the Company; the Company's current
products, services or processes do not infringe or will not infringe on the
patents currently held by any third party.
(xii) Except as described in the Offering Materials, the Company is
not under any obligation to pay royalties or fees of any kind whatsoever to
any third party with respect to any trademarks, service marks, copyrights,
service names, trade names, patents, patent applications, licenses or
technology it has developed, uses, employs or intends to use or employ,
other than to their respective licensors.
(xiii) Subject to the performance by May Xxxxx of its obligations
hereunder, the Credit Agreement and the offer and sale of the Securities
comply, and will continue to comply, up to the Commitment Period (as
defined in the Credit Agreement) in all material respects with the
requirements of Rule 506 of Regulation D promulgated by the SEC pursuant to
the 1933 Act and any other applicable federal and state laws, rules,
regulations and executive orders. Neither the Offering Materials nor any
amendment or supplement thereto nor any documents prepared by the Company
in connection with the Offering will contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. All statements of
material facts in the Offering Materials are true and correct as of the
date of the Offering Materials and will be true and correct on the date of
the Closing.
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(xiv) All material taxes which are due and payable from the Company
have been paid in full or adequate provision has been made for such taxes
on the books of the Company except for those taxes disputed in good faith
the Company does not have any tax deficiency or claim outstanding assessed
or proposed against it.
(xv) None of the Company nor any of its officers, directors, employees
or agents, nor any other person acting on behalf of the Company, has,
directly or indirectly, given or agreed to give any money, gift or similar
benefit (other than legal price concessions to customers in the ordinary
course of business) to any customer, supplier, employee or agent of a
customer or supplier, or official or employee of any governmental agency or
instrumentality of any government (domestic or foreign) or any political
party or candidate for office (domestic or foreign) or other person who is
or may be in a position to help or hinder the business of the Company (or
assist it in connection with any actual or proposed transaction) which (A)
might subject the Company to any damage or penalty in any civil, criminal
or governmental litigation or proceeding, or (B) if not given in the past,
might have had a materially adverse effect on the assets, business or
operations of the Company as reflected in any of the financial statements
contained in the Offering Materials, or (C) if not continued in the future,
might adversely affect the assets, business, operations or prospects of the
Company in the future.
5. Certain Covenants and Agreements of the Company.
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The Company covenants and agrees at its expense and without any expense to
May Xxxxx as follows:
A. To advise May Xxxxx of any material adverse change in the Company's
financial condition, prospects or business or of any development materially
affecting the Company or rendering untrue or misleading any material statement
in the Offering Materials occurring at any time prior to any Advance Date as
soon as the Company is either informed or becomes aware thereof.
B. To use its best efforts to cause the Common Stock issuable in connection
with the Credit Agreement to be qualified or registered for sale on terms
consistent with those stated in the Investor's Registration Rights Agreement,
and under the securities laws of such jurisdictions as May Xxxxx and the
Investor shall reasonably request, provided that such states and jurisdictions
do not require the Company to qualify as a foreign corporation. Qualification,
registration and exemption charges and fees shall be at the sole cost and
expense of the Company.
C. Upon written request, to provide and continue to provide the to each
holder of Securities, copies of all quarterly financial statements and audited
annual financial statements prepared by or on behalf of the Company, other
reports prepared by or on behalf of the Company for public disclosure and all
documents delivered to the Company's stockholders.
D. To deliver, during the Commitment Period, to May Xxxxx, upon May Xxxxx'x
request, in the manner provided in Section 10(B) of this Agreement, within forty
five (45) days after the end of each of the first three quarters of each fiscal
year of the Company, commencing with the first quarter ending after the
Commitment Period, a statement of its income for each such quarterly period, and
its balance sheet and a statement of changes in stockholders' equity as of the
end of such quarterly period, all in reasonable detail, certified by its
principal financial or accounting officer; (ii) within ninety (90) days after
the close of each fiscal year, its balance sheet as of the close of such fiscal
year, together with a statement of income, a statement of changes in
stockholders' equity and a statement of cash flow for such fiscal year, such
balance sheet, statement of income, statement of changes in stockholders' equity
and statement of cash flow to be in reasonable detail and accompanied by a copy
of the certificate or report thereon of independent auditors if audited
financial statements are prepared; and (iii) a copy of all documents, reports
and information furnished to its stockholders at the time that such documents,
reports and information are furnished to its stockholders.
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E. To comply with the terms of the Credit Agreement, the Registration
Rights Agreement, and the Escrow Agreement. F. To issue to May Xxxxx, or May
Xxxxx'x designee, upon the execution of the Credit Agreement, shares of
restricted Common stock of the Company equal three percent (3%) of the total
amount of the Credit Agreement.
G. To ensure that any transactions between or among the Company, or any of
its officers, directors and affiliates be on terms and conditions that are no
less favorable to the Company, than the terms and conditions that would be
available in an "arm's length" transaction with an independent third party.
6. Indemnification.
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A. The Company hereby agrees that it will indemnify and hold May Xxxxx and
each officer, director, shareholder, employee or representative of May Xxxxx,
and each person controlling, controlled by or under common control with May
Xxxxx within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934
Act or the SEC's rules and regulations promulgated there under (the "Rules and
Regulations"), harmless from and against any and all loss, claim, damage,
liability, cost or expense whatsoever (including, but not limited to, any and
all reasonable legal fees and other expenses and disbursements incurred in
connection with investigating, preparing to defend or defending any action, suit
or proceeding, including any inquiry or investigation, commenced or threatened,
or any claim whatsoever or in appearing or preparing for appearance as a witness
in any action, suit or proceeding, including any inquiry, investigation or
pretrial proceeding such as a deposition) to which May Xxxxx or such indemnified
person of May Xxxxx may become subject under the 1933 Act, the 1934 Act, the
Rules and Regulations, or any other federal or state law or regulation, common
law or otherwise, arising out of or based upon (i) any untrue statement or
alleged untrue statement of a material fact contained in (a) Section 4 of this
Agreement, (b) the Offering Materials (except those written statements relating
to May Xxxxx given by an indemnified person for inclusion therein), (c) any
application or other document or written communication executed by the Company
or based upon written information furnished by the Company filed in any
jurisdiction in order to qualify the Common Stock under the securities laws
thereof, or any state securities commission or agency; (ii) the omission or
alleged omission from documents described in clauses (a), (b) or (c) above of a
material fact required to be stated therein or necessary to make the statements
therein not misleading; or (iii) the breach of any representation, warranty,
covenant or agreement made by the Company in this Agreement. The Company further
agrees that upon demand by an indemnified person, at any time or from time to
time, it will promptly reimburse such indemnified person for any loss, claim,
damage, liability, cost or expense actually and reasonably paid by the
indemnified person as to which the Company has indemnified such person pursuant
hereto. Notwithstanding the foregoing provisions of this Paragraph 6(A), any
such payment or reimbursement by the Company of fees, expenses or disbursements
incurred by an indemnified person in any proceeding in which a final judgment by
a court of competent jurisdiction (after all appeals or the expiration of time
to appeal) is entered against May Xxxxx or such indemnified person as a direct
result of May Xxxxx or such person's gross negligence or willful misfeasance
will be promptly repaid to the Company.
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B. May Xxxxx hereby agrees that it will indemnify and hold the Company and
each officer, director, shareholder, employee or representative of the Company,
and each person controlling, controlled by or under common control with the
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act or the Rules and Regulations, harmless from and against any and all
loss, claim, damage, liability, cost or expense whatsoever (including, but not
limited to, any and all reasonable legal fees and other expenses and
disbursements incurred in connection with investigating, preparing to defend or
defending any action, suit or proceeding, including any inquiry or
investigation, commenced or threatened, or any claim whatsoever or in appearing
or preparing for appearance as a witness in any action, suit or proceeding,
including any inquiry, investigation or pretrial proceeding such as a
deposition) to which the Company or such indemnified person of the Company may
become subject under the 1933 Act, the 1934 Act, the Rules and Regulations, or
any other federal or state law or regulation, common law or otherwise, arising
out of or based upon (i) the conduct of May Xxxxx or its officers, employees or
representatives in its acting as Placement Agent for the Offering or (ii) the
breach of any representation, warranty, covenant or agreement made by May Xxxxx
in this Agreement (iii) any false or misleading information provided to the
Company by one of the May Xxxxx indemnified persons.
C. Promptly after receipt by an indemnified party of notice of commencement
of any action covered by Section 6(A) or 6(B), the party to be indemnified
shall, within five (5) business days, notify the indemnifying party of the
commencement thereof; the omission by one indemnified party to so notify the
indemnifying party shall not relieve the indemnifying party of its obligation to
indemnify any other indemnified party that has given such notice and shall not
relieve the indemnifying party of any liability outside of this indemnification
if not materially prejudiced thereby. In the event that any action is brought
against the indemnified party, the indemnifying party will be entitled to
participate therein and, to the extent it may desire, to assume and control the
defense thereof with counsel chosen by it which is reasonably acceptable to the
indemnified party. After notice from the indemnifying party to such indemnified
party of its election to so assume the defense thereof, the indemnifying party
will not be liable to such indemnified party under such Section 6(A) or 6(B) for
any legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof, but the indemnified party may, at its own
expense, participate in such defense by counsel chosen by it, without, however,
impairing the indemnifying party's control of the defense. Subject to the
proviso of this sentence and notwithstanding any other statement to the contrary
contained herein, the indemnified party or parties shall have the right to
choose its or their own counsel and control the defense of any action, all at
the expense of the indemnifying party if, (i) the employment of such counsel
shall have been authorized in writing by the indemnifying party in connection
with the defense of such action at the expense of the indemnifying party, or
(ii) the indemnifying party shall not have employed counsel reasonably
satisfactory to such indemnified party to have charge of the defense of such
action within a reasonable time after notice of commencement of the action, or
(iii) such indemnified party or parties shall have reasonably concluded that
there may be defenses available to it or them which are different from or
additional to those available to one or all of the indemnifying parties (in
which case the indemnifying parties shall not have the right to direct the
defense of such action on behalf of the indemnified party or parties), in any of
which events such fees and expenses of one additional counsel shall be borne by
the indemnifying party; provided, however, that the indemnifying party shall
not, in connection with any one action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstance, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys at any time for all such indemnified
parties. No settlement of any action or proceeding against an indemnified party
shall be made without the consent of the indemnifying party.
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D. In order to provide for just and equitable contribution in circumstances
in which the indemnification provided for in Section 6(A) or 6(B) is due in
accordance with its terms but is for any reason held by a court to be
unavailable on grounds of policy or otherwise, the Company and May Xxxxx shall
contribute to the aggregate losses, claims, damages and liabilities (including
legal or other expenses reasonably incurred in connection with the investigation
or defense of same) which the other may incur in such proportion so that May
Xxxxx shall be responsible for such percent of the aggregate of such losses,
claims, damages and liabilities as shall equal the percentage of the gross
proceeds paid to May Xxxxx and the Company shall be responsible for the balance;
provided, however, that no person guilty of fraudulent misrepresentation within
the meaning of Section 11(f) of the 1933 Act shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation. For
purposes of this Section 6(D), any person controlling, controlled by or under
common control with May Xxxxx, or any partner, director, officer, employee,
representative or any agent of any thereof, shall have the same rights to
contribution as May Xxxxx and each person controlling, controlled by or under
common control with the Company within the meaning of Section 15 of the 1933 Act
or Section 20 of the 1934 Act and each officer of the Company and each director
of the Company shall have the same rights to contribution as the Company. Any
party entitled to contribution will, promptly after receipt of notice of
commencement of any action, suit or proceeding against such party in respect of
which a claim for contribution may be made against the other party under this
Section 6(D), notify such party from whom contribution may be sought, but the
omission to so notify such party shall not relieve the party from whom
contribution may be sought from any obligation they may have hereunder or
otherwise if the party from whom contribution may be sought is not materially
prejudiced thereby. The indemnity and contribution agreements contained in this
Section 6 shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of any indemnified person or any termination
of this Agreement.
7. Payment of Expenses.
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The Company hereby agrees to bear all of the expenses in connection with
the Offering, including, but not limited to the following: filing fees, printing
and duplicating costs, advertisements, postage and mailing expenses with respect
to the transmission of Offering Materials, registrar and transfer agent fees,
Escrow Agent fees and expenses, fees of the Company's counsel and accountants,
issue and transfer taxes, if any, and counsel fees and expenses.
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8. Conditions of Each Closing
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Each Closing shall be held at the offices of May Xxxxx or its counsel. The
obligations of May Xxxxx hereunder shall be subject to the continuing accuracy
of the representations and warranties of the Company herein as of the date
hereof and as of each Advance Date with respect to the Company as if it had been
made on and as of such Advance Date; the accuracy on and as of each Advance Date
of the statements of the officers of the Company made pursuant to the provisions
hereof; and the performance by the Company on and as of each Closing of its
covenants and obligations hereunder and to the following further conditions:
A. At each Closing, May Xxxxx shall receive the opinion of Wenthur &
Chachas, dated as of the date of the Closing, which opinion shall be in form and
substance reasonably satisfactory to counsel for May Xxxxx.
B. At or prior to each Closing, counsel for May Xxxxx shall have been
furnished such documents, certificates and opinions as they may reasonably
require for the purpose of enabling them to review or pass upon the matters
referred to in this Agreement and the Offering Materials, or in order to
evidence the accuracy, completeness or satisfaction of any of the
representations, warranties or conditions herein contained.
C. At and prior to each Closing, (i) there shall have been no material
adverse change nor development involving a prospective change in the condition
or prospects or the business activities, financial or otherwise, of the Company
from the latest dates as of which such condition is set forth in the Offering
Materials; (ii) there shall have been no transaction, not in the ordinary course
of business, entered into by the Company which has not been disclosed in the
Offering Materials or to May Xxxxx in writing; (iii) except as set forth in the
Offering Materials, the Company shall not be in default under any provision of
any instrument relating to any outstanding indebtedness for which a waiver or
extension has not been otherwise received; (iv) except as set forth in the
Offering Materials, the Company shall not have issued any securities (other than
those to be issued as provided in the Offering Materials) or declared or paid
any dividend or made any distribution of its capital stock of any class and
there shall not have been any change in the indebtedness (long or short term) or
liabilities or obligations of the Company (contingent or otherwise); (v) no
material amount of the assets of the Company shall have been pledged or
mortgaged, except as indicated in the Offering Materials; and (v) no action,
suit or proceeding, at law or in equity, against the Company or affecting any of
its properties or businesses shall be pending or threatened before or by any
court or federal or state commission, board or other administrative agency,
domestic or foreign, wherein an unfavorable decision, ruling or finding could
materially adversely affect the businesses, prospects or financial condition or
income of the Company, except as set forth in the Offering Materials.
D. At each Closing, May Xxxxx shall have received a certificate of the
Company signed by an executive officer and chief financial officer, dated as of
the applicable Advance Date, to the effect that the conditions set forth in
subparagraph (C) above have been satisfied and that, as of the applicable
Advance Date, the representations and warranties of the Company set forth herein
are true and correct.
E. At the initial Closing, the Company shall have duly executed and
delivered to May Xxxxx, or its designees, shares of the Company's common stock,
in the names and denominations specified by May Xxxxx.
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9. Termination.
-----------
This Agreement shall be co-terminus with, and terminate upon the same terms
and conditions as those set forth in, the Credit Agreement. The rights of the
Investor and the obligations of the Company under the Registration Rights
Agreement, and the rights of May Xxxxx and the obligations of the Company under
the Placement Agent's Warrants and the Placement Agent's Registration Rights
Agreement shall survive the termination of this Agreement unabridged.
10. Miscellaneous.
-------------
A. This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but all which shall be deemed to be one
and the same instrument.
B. Any notice required or permitted to be given hereunder shall be given in
writing and shall be deemed effective when deposited in the United States mail,
postage prepaid, or when received if personally delivered or faxed ( upon
confirmation of receipt received by the sending party), addressed as follows:
To May Xxxxx:
May Xxxxx Group, Inc.
Xxx Xxxxx Xxxxx Xxxxxx - Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxx
with a copy to:
Xxxxxx Xxxxxxxx LLP
0000 Xxxxxxxxxx Xxxxxx
Xxxxx #0
Xxxxx, XX 00000
Fax: (000) 000-0000
Attention: Xxxxx Xxxxxxxx, Esq.
To the Company:
Condor Capital Inc.
0000 Xxxxxx Xxxxxx Xxxxxxx
Xxxxx 0000
Xxx Xxxxx, Xxxxxx
Attention: Xxx Xxxx and Xxx Xxxxxxx
with copy to:
Xxxxxx X. Xxxxxxx, Esq.
Wenthur & Chachas
0000 Xx Xxxxx Xxxxxxx Xxxxx
Xxxxx 000
Xx Xxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
or to such other address of which written notice is given to the others.
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C. This Agreement shall be governed by and construed in all respects under
the laws of the State of New York, without reference to its conflict of laws
rules or principles. Any suit, action, proceeding or litigation arising out of
or relating to this Agreement shall be brought and prosecuted in such federal or
state court or courts located within the State of New York as provided by law.
The parties hereby irrevocably and unconditionally consent to the jurisdiction
of each such court or courts located within the State of New York and to service
of process by registered or certified mail, return receipt requested, or by any
other manner provided by applicable law, and hereby irrevocably and
unconditionally waive any right to claim that any suit, action, proceeding or
litigation so commenced has been commenced in an inconvenient forum.
D. This Agreement and the other agreements referenced herein contain the
entire understanding between the parties hereto and may not be modified or
amended except by a writing duly signed by the party against whom enforcement of
the modification or amendment is sought.
E. If any provision of this Agreement shall be held to be invalid or
unenforceable, such invalidity or unenforceability shall not affect any other
provision of this Agreement.
[SIGNATURE PAGE TO FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
CONDOR CAPITAL INC.
By: /S/ Xxx Xxxx
--------------------------------------
Name: Xxx Xxxx
Title: President and CEo
MAY XXXXX GROUP, INC.
By: /S/ Xxxxxxx Xxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Managing Director
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SCHEDULE A
COMMON STOCK HOLDER AMOUNT
------------------- ------
The May Xxxxx Group, Inc.
Xxxx X. Xxxxxx
Xxxxxx Xxxxxxx
Xxxxxx Xxxxxx
Xxxxxx Xxxxxxx
Xxxxxxx Xxxxxxx
14