Exhibit 1.2
AURORA FINANCIAL SERVICES, L.L.C.
INVESTMENT SECURITIES
0000 Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
October 15, 1999
XxxXxxx.Xxx, Inc.
0000 Xxxxxxx Xxxx
Xxx Xxxxxxx, Xxxxx 00000
Re: Equity Placement by Aurora Financial Services, L.L.C. for XxxXxxx.xxx,
Inc.
Gentlemen:
Aurora Financial Services, L.L.C., (hereinafter referred to as "Aurora ")
hereby agrees to attempt to raise certain amounts (hereinafter referred to as
"the Required Capital") for XxxXxxx.xxx, Inc. (herein referred to as "BioLynx"
and as the "Issuer"). BioLynx hereby agrees to be bound by this agreement. The
required capital to be raised is as follows:
Xxxxxx agrees to attempt to raise a minimum of $2,000,000 up to a maximum
of $4,000,000 for the Issuer which will pertain to providing biometric
automation for the control of employees time and attendance for employers.
The efforts of Aurora to raise the required capital are based upon the
following terms and conditions.
1. Engagement. For a period of 180 days from the effective date of the
Registration Statement under the Securities Act of 1933 (hereinafter referred to
as the ("Prospectus"), related to sale of equity securities of the Issuer,
BioLynx shall grant to Aurora the exclusive right to raise the Required Capital
in the manner to be described in the Prospectus. Provided, however,
notwithstanding anything herein obtained to the contrary, Xxxxxx shall be
entitled to employ other broker-dealers selected by it to sell all or any
portion of the Required Capital. In that regard, Xxxxxx shall be entitled to
reallow a portion of its commission to such participating broker-dealers
resulting from any of the Required Capital raised by them. Xxxxxx may terminate
the Offering to be described in the Prospectus in the event that, among other
things, (a) certain specified actions, usually associated with extremely adverse
economic and market conditions, have been taken by the principal national
securities exchanges or by governmental authorities, or (b) other events have
occurred or are pending or threatened which, in the judgement of Aurora,
materially impair the investment quality of an investment in the Issuer.
2. Termination. If the Offering fails to have an Initial Closing resulting
in the raising of the minimum of the Required Capital to be described in the
Prospectus within 180 days following the effective date of the Prospectus, this
Agreement shall terminate with respect to the provisions which relate to the
failure to have such Initial Closing. Likewise, if the said offering shall fail
to close by the "Extended Subscription Period" (and/or terms of similar import)
as described in the Prospectus, this agreement shall terminate with respect to
the provisions which relate to the Issuer. As used herein, the terms "Initial
Closing", "Subsequent Closings" and "Extended Subscription Period" shall have
the meanings fairly ascribed to them in the Prospectus. Notwithstanding anything
herein contained to the contrary, in the event that either party hereto violates
the terms of this Agreement or the securities laws of the United States any
state wherein interests in the Issuer are to be offered for sale, or if either
party shall furnish to the other party hereunder information which is untrue or
misleading or fails to state the facts which make any such information so
supplied misleading, then the other party may terminate this Agreement without
any further liability hereunder.
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3. The Offering. The Required Capital shall be raised by Xxxxxx pursuant to
an offering involving the public sale of securities (hereinafter referred to as
the "Offering"). The Offering shall be conducted in conformity with the
securities Act of 1933, as amended (herein referred to as the "1933 Act"). The
Offering documents shall be prepared at the direction of BioLynx by parties
selected by and who are acceptable to Xxxxxx. The work on the Prospectus with
respect to the Offering shall begin upon the effective date of this Agreement.
4. Best Efforts. The Offering will be on a "best effort" only basis, with
no guarantees by Xxxxxx that any or all of the Required Capital shall be raised.
5. Compensation. As its compensation in connection with the raising of the
Required Capital, Xxxxxx shall be entitled to receive the following:
(a) A sales commission equal to 10% of the Required Capital raised by
Xxxxxx or any broker-dealer selected by Xxxxxx and acting pursuant to the
terms of this Agreement for the Issuer. Any sales commissions shall be paid
upon any Initial, Subsequent or Final Closing of the Offering.
(b) Aurora will receive a 3% non refundable and non accountable
investment banking fee.
(c) In addition, Aurora will receive 25,000 shares of common stock in
XxxXxxx.Xxx, Inc.
(d) The agreement of BioLynx evidenced by its execution hereof that
should BioLynx or any of its affiliates undertake within the first 60 month
period following the date hereof, an offering or offerings of securities
for the purpose of raising capital from third party investors, then Aurora
(or any successor to Xxxxxx) will be tendered a right of first refusal to
act as selling agent or dealer manager, as then appropriate, in respect to
any such offering or offerings.
(e) In the event BioLynx (or any successor or successors or subsidiary
of BioLynx) shall determine within the first 60 month period following the
date hereof to undertake a program or plan to issue common stock or other
form of equity security whether or not in furtherance of a contemplated
public offering, then BioLynx agrees to tender to Aurora (i) a right of
first refusal in general accord with Subparagraph (c) of this Paragraph 5,
and (ii) the right to purchase for a nominal consideration a generous
number, giving effect to the then existing circumstances, of rights or
warrants to acquire at a favorable exercise price a recognizable percentage
of equity in the entity resulting from any such offering, reorganization or
recapitalization.
6. Indemnification. Each of the parties hereto shall indemnify and hold the
other harmless against any losses, claims, damages or liability, joint or
several, to which the indemnified party may become subject under the 1933 Act or
otherwise, by the other party by reason of any representation, warranty or
covenant contained in this Agreement or resulting from any untrue statements of
a material fact or omission thereof with respect to the information concerning
the parties to be contained in any Prospectus relating to the Offering made in
reliance upon and in conformity with the information furnished to the
indemnified party. Insofar as this indemnity agreement relates to any untrue
statement or omission made in any such Prospectus, this indemnity agreement
shall not inure to the benefit of the indemnified party if (i) the other party
shall have furnished to the indemnified party an amendment or supplement to the
Prospectus which corrected such untrue statement or omission which is the basis
for the loss, liability, claim, damage or expense for which indemnification is
sought and (ii) the indemnified party failed to send or give a copy of such
corrective amendment or supplement to the person asserting any such loss,
liability, claim, damage or expense at such time as the Prospectus as so amended
or supplemented, is required under the 1933 Act to be delivered by the
indemnified party to such person.
(a) BioLynx agrees to indemnify and hold harmless Aurora and each person,
if any, who controls Aurora within the meaning of the 1933 Act, from and against
any and all losses, claims, damages or liabilities, joint or several (including,
without limitation, any and all expenses whatsoever reasonably
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incurred in investigating, preparing, or defending against the same), which
arise out of or are based upon (i) any untrue statement or alleged untrue
statement of a material fact contained in the Prospectus, or any amendment or
supplement thereto, or any application or other document filed in any state or
jurisdiction in order to qualify the Offering under the Blue Sky or securities
laws thereof ("Blue Sky Application"), if necessary, or to secure an exemption
therefrom, or which arise out of or are based upon the omission or alleged
omission to state therein a 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 and (ii) any actions, direct or indirect, in
connection with the offering and sale of the securities by BioLynx or any of
their respective agents or employee (other than by Aurora its employees or
affiliates), employees or affiliates in violation of the 1933 Act, or any other
applicable federal or state securities laws or regulations.
BioLynx agrees to promptly notify Xxxxxx of the commencement of any
litigation or proceedings against BioLynx or any of their respective officers,
directors, employees, agents or affiliates in connection with the Offering.
(b) Xxxxxx agrees to indemnify BioLynx and their respective affiliates, and
hold each of them harmless against any losses, claims, damages or liabilities to
which they or either of them may become subject, under the 1933 Act or the
Securities Exchange Act of 1934, as amended, or otherwise, insofar as such
losses, claims damages or liabilities (or actions in respect thereof) arise out
of or are based upon (i) any untrue statement or alleged untrue statement of any
material fact made by Xxxxxx or arising out of any violation or alleged
violation by Xxxxxx or any of Aurora's representations, warranties, covenants or
agreements contained in this Agreement, (ii) any misuse or unauthorized use in
any jurisdiction of any supplemental sales literature (whether designed solely
for broker-dealer use or otherwise) by Aurora or (iii) any delivery,
distribution or furnishing by Xxxxxx, either orally or in writing, of
information not contained in or materially inconsistent with, the Prospectus or
supplemental sales literature (as they, respectively, may be amended or
supplemented).
(c) Promptly after receipt by an indemnified party under subparagraph (a)
or (b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subparagraph, notify the indemnifying party in writing of the
commencement thereof; but the omission to so notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subparagraph. In case any such action shall be brought
against any indemnified party, and it shall notify the indemnifying party, of
the commencement thereof, the indemnifying party shall be entitled to
participate in, and, to the extent that it shall wish, to jointly participate
with any other indemnifying party, similarly notified, in the defense thereof
with the indemnified party. The indemnifying party shall pay all legal fees and
expenses of the indemnified party in the defense of such claims and actions,
provided, however, that the indemnifying party shall not be obliged to pay legal
expenses and fees to more than one law firm in connection with the defense of
similar claims arising out of the same alleged acts or omissions giving rise to
such claims, notwithstanding that such actions or claims are alleged or brought
by one or more parties against more than one indemnified party. In case such
claims or actions are alleged or brought against more than one indemnified
party, then the indemnifying party shall only be obliged to reimburse the
expenses and fees of the one law firm which has been selected by a majority of
the indemnified parties against which such action as finally brought and, in the
event a majority of such indemnified parties are unable to agree on which law
firm or which expenses or fees will be reimbursed by the indemnifying party. The
payments shall be made to the first law firm of record representing an
indemnified party against the action or claim. Such law firm shall be paid only
to the extent of services performed by such law firm and no reimbursement shall
be payable to law firm on account of legal services performed by another law
firm. Notwithstanding anything contained herein to the contrary, an indemnified
party may, without the prior consent of the indemnifying party, settle or
compromise any action brought against such indemnified party.
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(d) The provisions of this Paragraph 6 shall remain in full force and
effect after the termination of this Agreement.
7. Effective Date. The effective date of this Agreement is the last date
that a party hereto executes same.
8. Further Acts. Each party hereto recognizes that this Agreement is not
complete in every detail with respect to the Offering, and that it may be
necessary to amend this Agreement from time to time in order to carry out the
intent hereof. However, each party will proceed in good faith to arrive at
whatever necessary adjustments are needed in order to carry out the terms of
this Agreement. Further, each party agrees to provide in a timely and complete
manner all information needed to complete the preparation of the Offering
documents and to supplement any such information as needed during the course of
the Offering or thereafter. In this connection, the Issuer undertakes and agrees
to provide Xxxxxx with all such information and data as it may reasonably
require to comply with its statutory and regulatory obligations in connection
with the Offering, the application of proceeds, the operations of the Issuer and
the like.
9. Attorney's fees. In the event that it should become necessary for any
party entitled hereunder to bring suit against any other party to this Agreement
for enforcement of the covenants herein contained, the parties hereby covenant
and agree that the party who is found to be in violation of said covenants shall
also be liable for all reasonable attorney's fees and costs of court incurred by
the other parties hereto.
10. Benefit. All the terms and provisions of this Agreement shall be
binding upon and inure to the benefit of and be enforceable by the parties
hereto, and their respective heirs, executors, administrators, personal
representatives, successors and permitted assigns.
11. Notices. All notices, requests, demands and other communications
hereunder shall be in writing and delivered personally or sent by registered or
certified United States mail, return receipt requested with postage prepaid, if
to Xxxxxx addressed to Mr. Xxxxx Xxxxxx at 0000 Xxxxxx, Xxxxx 000, Xxxxxxx, XX
00000, and if to BioLynx, addressed to Xxxx X Xxxxxx XX President and CEO 0000
Xxxxxxx Xxxx, Xxx Xxxxxxx, Xxxxx 00000. Any party hereto may change its address
upon 10 days written notice to any other party hereto.
12. Construction. Words of any gender used in this Agreement shall be held
and construed to include any other gender, and words in the singular number
shall be held to include the plural, and vice versa, unless the context requires
otherwise. In addition, the pronouns used in this Agreement shall be understood
and construed to apply whether the party referred to is an individual,
partnership, joint venture, corporation or an individual or individuals doing
business under a firm or trade name, and the masculine, feminine and neuter
pronouns shall each include the other and may be used interchangeably with the
same meaning.
13. Waiver. No course of dealing on the part of any party hereto or its
agents, or any failure or delay by any such party with respect to exercising any
right, power or privilege of such party under this Agreement or any instrument
referred to herein shall operate as a waiver thereof, and any single or partial
exercise of any such right, power or privilege shall not preclude any later
exercise thereof or any exercise of any other right, power or privilege
hereunder or thereunder.
14. Cumulative Rights. The rights and remedies of any party under this
Agreement and the instruments executed or to be executed in connection herewith,
or any of them, shall be cumulative and the exercise or partial exercise of any
such right or remedy shall not preclude the exercise of any other right or
remedy.
15. Invalidity. In the event any one or more of the provisions contained in
this Agreement or in any instrument referred to herein or executed in connection
herewith shall, for any reason, be held to be invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not affect
the other provisions of this Agreement or any such other instrument.
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16. Headings. The headings used in this Agreement are for convenience and
reference only and in no way define, limit, amplify or describe the scope or
intent of this Agreement, and in no way effect or constitute a part of this
Agreement.
17. Excusable Delay. None of the parties shall be obligated to perform and
none shall be deemed to be in default hereunder, if the performance of a non-
monetary obligation is prevented by the occurrence of any of the following,
other than as the result of the financial inability of the party obligated to
perform: acts of God, strikes, lock-outs, other industrial disturbances, acts of
a public enemy, war or war-like action (whether actual, impending or expected
and whether de jure or de facto), arrest or other restraint of governmental
(civil or military) blockades, insurrections, riots, epidemics, landslides,
lightning, earthquakes, fires, hurricanes, storms, floods, washouts, sink holes,
civil disturbances, explosions, breakage or accident to equipment or machinery,
confiscation or seizure by any government of public authority, nuclear reaction
or radiation, radioactive contamination or other causes, whether of the kind
herein enumerated or otherwise, that are not reasonably within the control of
the party claiming the right to delay performance on account of such occurrence.
18. Multiple counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
19. Law Governing. This Agreement shall be construed and governed by the
laws of the State of Texas, and all obligations hereunder shall be deemed
performable in Xxxxxx County, Texas.
20. Further Acts. The parties hereto shall do all other acts and things
that may be reasonably necessary or proper, full or more fully, to evidence,
complete or perfect this Agreement, and to carry out the intent of this
Agreement.
21. Entire Agreement. This instrument contains the entire Agreement of the
parties and may not be changed orally, but only by instrument in writing signed
by the party against whom enforcement of any waiver, change, modification,
extension or discharge is sought.
If the foregoing meets your approval, please sign and date the enclosed
copies of this letter in the space provided below, and return same to us as soon
as possible.
Very truly yours,
AURORA FINANCIAL SERVICES, L.L.C.
By: /s/ Xxxxx Xxxxxx
----------------------------
Xxxxx Xxxxxx, President
Date Executed: October 15, 1999
This Letter Agreement is accepted and
agreed to this 20th day of October, 1999
XxxXxxx.Xxx, Inc.
By: /s/ Xxxx X. Xxxxxx XX
-----------------------------
Xxxx X Xxxxxx XX
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