CONSULTING AND INVESTMENT BANKING AGREEMENT
This Agreement is made and entered into as of the ___ day of
_____________, 1997 by and between Duke & Co., Inc., a Florida corporation
("Duke"), and IFS International, Inc., a Delaware corporation (the "Company").
In consideration of the mutual promises made herein and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:
1. Purpose. The Company hereby engages Duke for the term
specified in Paragraph 2 hereof to render consulting advice to the Company as an
investment banker relating to financial and similar matters upon the terms and
conditions set forth herein.
2. Term. Except as otherwise specified in Paragraph 4 hereof,
this Agreement shall be effective for a two (2) year period commencing
_________________, 1997 and ending _____________, 1999.
3. Duties of Duke. During the term of this Agreement, Duke
shall seek out Transactions (as hereinafter defined) on behalf of the Company
and shall furnish advice to the Company in connection with any such
Transactions.
4. Compensation. In consideration for the services rendered by
Duke to the Company pursuant to this Agreement (and in addition to the expenses
provided for in Paragraph 5 hereof), the Company shall compensate Duke as
follows:
(a) The Company shall pay Duke a fee of [$4,166.67]
per month for the term of this Agreement. The aggregate sum of [$100,000] shall
be due and payable upon the execution of this Agreement.
(b) In the event that any Transaction occurs during
the term of this Agreement, the Company shall pay fees to Duke as follows:
Consideration Fee
------------- ---
$ - 0 - to $500,000 $25,000
Above $500,000 to $5,000,000 5% of Consideration
Above $5,000,000 $250,000 plus 1% of the
Consideration in excess of
$5,000,000
For the purposes of this Agreement, "Consideration" shall mean
the total market value, as determined by the Company's Board of Directors on the
day of the closing of the Transaction, of stock, cash, assets and all other
property (real or personal) exchanged or received, directly or indirectly, by
the Company or any of its security holders in connection with any Transaction.
Any co-broker retained by Duke shall be paid by Duke.
(c) For the purposes of this Agreement, a
"Transaction" shall mean (i) any transaction introduced to the Company by Duke,
other than in the ordinary course of trade or business of the Company, whereby,
directly or indirectly, control of, or a material interest in, the Company or
any of its business or substantially all of its assets, is transferred for
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Consideration, or (ii) any transaction introduced to the Company by Duke whereby
the Company acquires any other unaffiliated company or substantially all of the
assets of any other unaffiliated company or a controlling interest in any other
company (an "Acquisition").
In the event Duke originates, at the Company's request, a line
of credit with a lender or a corporate partner, the Company and Duke will
mutually agree on a satisfactory fee and the terms of payment of such fee. In
the event Duke introduces the Company to a joint venture partner or customer and
sales develop as a result of the introduction, the Company agrees to pay a fee
of two percent (2%) of total sales generated directly from this introduction
during the first two years following the date of the first sale. Total sales
shall mean gross receipts less any applicable refunds, returns, allowances,
credits, taxes and shipping charges and monies paid by the Company by way of
settlement or judgment arising out of claims made by or threatened against the
Company. Commission payments shall be paid on the 15th day of each third month
following the receipt of the customers' payments. In the event any adjustments
are made to the total sales after the commission has been paid, the Company
shall be entitled, at its option, to an appropriate refund or credit against
future payments under this Agreement.
(d) All fees to be paid pursuant to this Agreement,
except as otherwise specified, are due and payable to Duke in cash or company
check at the closing or closings of any
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Transaction specified in Paragraph 4. In the event that the Consideration is
paid out over a period of time, Duke shall be paid its pro-rata portion of such
Consideration as the Company is paid. In the event that this Agreement shall not
be renewed or if terminated for any reason, notwithstanding any such non-renewal
or termination, Duke shall be entitled to a full fee as provided under
Paragraphs 4 and 5 hereof, for any Transaction for which the discussions were
initiated with a third party at the request of the Company during the term of
this Agreement and which is consummated within a period of twelve months after
non-renewal or termination of this Agreement. Nothing herein shall impose any
obligation on the part of the Company to enter into any Transaction.
5. Expenses of Duke. In addition to the fees payable hereunder
and regardless of whether any Transaction set forth in Paragraph 4 hereof is
proposed or consummated, the Company shall reimburse Duke for Duke's reasonable
travel and out-of-pocket expenses incurred in connection with the services
performed by Duke pursuant to this Agreement and at the request of the Company,
including without limitation, hotels, food and associated expenses and
long-distance telephone calls.
6. Liability of Duke.
(1) The Company acknowledges that all opinions and
advice (written or oral) given by Duke to the Company in connection with Duke's
engagement are intended solely for the benefit and use of the Company in
considering the Transaction to
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which they relate, and the Company agrees that no person or entity other than
the Company shall be entitled to make use of or rely upon the advice of Duke to
be given hereunder, and no such opinion or advice shall be used for any other
purpose or reproduced, disseminated, quoted or referred to at any time, in any
manner or for any purpose, nor may the Company make any public references to
Duke, or use Duke's name in any annual reports or any other reports or releases
of the Company without Duke's prior written consent or as required by law.
(2) The Company acknowledges that Duke makes no
commitment whatsoever as to making a market in the Company's securities or to
recommending or advising its clients to purchase the Company's securities.
Research reports or corporate finance reports that may be prepared by Duke will,
when and if prepared, be done solely on the merits or judgement of analysis of
Duke or any senior corporate finance personnel of Duke.
7. Duke's Services to Others. The Company acknowledges that
Duke or its affiliates are in the business of providing financial services and
consulting advice to others. Nothing herein contained shall be construed to
limit or restrict Duke in conducting such business with respect to others, or in
rendering such advice to others, except that Duke will not provide services to
others when such services may materially and adversely affect the Company.
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8. Company Information.
(a) The Company recognizes and confirms that, in
advising the Company and in fulfilling its engagement hereunder, Duke will use
and rely on data, material and other information furnished to Duke by the
Company. The Company acknowledges and agrees that in performing its services
under this engagement, Duke may rely upon the data, material and other
information supplied by the Company without independently verifying the
accuracy, completeness or veracity of same.
(b) Except as required by applicable law, Duke
shall keep confidential all non-public information provided to it by the
Company, and shall not disclose such information to any third party without the
Company's prior written consent, other than such of its employees and advisors
as Duke reasonably determines to have a need to know, provided that Duke shall
instruct such employees and advisors to keep such information confidential and
Duke shall be liable for any breach of such confidentiality. In the event that
Duke is required by subpoena to disclose such information, the Company shall be
afforded an opportunity to seek an order preserving the confidentiality of such
information.
9. Indemnification.
(a) The Company shall indemnify and hold Duke
harmless against any and all liabilities, claims, lawsuits, including any and
all awards and/or judgments to which it may become subject under the Securities
Act of 1933, as amended (the
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"1933 Act"), the Securities Exchange Act of 1934, as amended (the "1934 Act") or
any other federal or state statute, at common law or otherwise, insofar as said
liabilities, claims and lawsuits (including costs, expenses, awards and/or
judgments) arise out of or are in connection with the services rendered by Duke
or any transactions in connection with this Agreement, except for any
liabilities, claims and lawsuits (including awards and/or judgments), arising
out of acts or omissions of Duke. In addition, the Company shall also indemnify
and hold Duke harmless against any and all costs and expenses, including
reasonable counsel fees, incurred relating to the foregoing.
Duke shall give the Company prompt notice of any such
liability, claim or lawsuit which Duke contends is the subject matter of the
Company's indemnification and the Company thereupon shall be granted the right
to take any and all necessary and proper action, at its sole cost and expense,
with respect to such liability, claim and lawsuit, including the right to
settle, compromise and dispose of such liability, claim or lawsuit, excepting
therefrom any and all proceedings or hearings before any regulatory bodies
and/or authorities and provided that no such settlement shall be made without
the prior consent of Duke.
Duke shall indemnify and hold the Company harmless against any
and all liabilities, claims and lawsuits, including any and all awards and/or
judgments to which it may become subject under the 1933 Act, the 1934 Act or any
other federal or state statute, at common law or otherwise, insofar as said
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liabilities, claims and lawsuits (including costs, expenses, awards and/or
judgments) arise out of or are in connection with the services rendered by Duke
or any transactions in connection with this Agreement. In addition, Duke shall
also indemnify and hold the Company harmless against any and all costs and
expenses, including reasonable counsel fees, incurred relating to the foregoing.
The Company shall give Duke prompt notice of any such
liability, claim or lawsuit which the Company contends is the subject matter of
Duke's indemnification and Duke thereupon shall be granted the right to take any
and all necessary and proper action, at its sole cost and expense, with respect
to such liability, claim or lawsuit, including the right to settle, compromise
or dispose of such liability, claim or lawsuit, excepting therefrom any and all
proceedings or hearings before any regulatory bodies and/or authorities and
provided that no such settlement shall be made without the prior consent of the
Company.
(b) In order to provide for just and equitable
contribution in any case in which (i) any person entitled to indemnification
under this Paragraph 9 makes claim for indemnification pursuant hereto but it is
judicially determined (by the entry of a final judgment or decree by a court of
competent jurisdiction and the expiration of time to appeal or the denial of the
last right of appeal) that such indemnification may not be enforced in such case
notwithstanding the fact that
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this Paragraph 9 provides for indemnification in such case, or (ii) contribution
may be required on the part of any such person in circumstances for which
indemnification is provided under this Paragraph 9, then, and in each such case,
the Company and Duke shall contribute to the aggregate losses, claims, damages
or liabilities to which they may be subject (after any contribution from others)
in such proportion taking into consideration the relative benefits received by
each party from the transactions undertaken in connection with this Agreement
(taking into account the portion of the proceeds realized by each), the parties'
relative knowledge and access to information concerning the matter with respect
to which the claim was assessed, the opportunity to correct and prevent any
statement or omission and other equitable considerations appropriate under the
circumstances; and provided, that, in any such case, no person guilty of a
fraudulent misrepresentation (within the meaning of Section 11(f) of the 0000
Xxx) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation.
Within fifteen (15) days after receipt by any party to this
Agreement (or its representative) of notice of the commencement of any action,
suit or proceeding, such party will, if a claim for contribution in respect
thereof is to be made against another party (the "Contributing Party"), notify
the Contributing Party of the commencement thereof, but the omission so to
notify the Contributing Party will not relieve it from any
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liability which it may have to any other party other than for contribution
hereunder. In case any such action, suit or proceeding is brought against any
party, and such party notifies a Contributing Party or his or its representative
of the commencement thereof within the aforesaid fifteen (15) days, the
Contributing Party will be entitled to participate therein with the notifying
party and any other Contributing Party similarly notified. Any such Contributing
Party shall not be liable to any party seeking contribution on account of any
settlement of any claim, action or proceeding effected by such party seeking
contribution without the written consent of the Contributing Party. The
indemnification provisions contained in this Paragraph 9 are in addition to any
other rights or remedies which either party hereto may have with respect to the
other or hereunder.
10. Duke an Independent Contractor. Duke shall perform its
services hereunder as an independent contractor and not as an employee of the
Company or an affiliate thereof. The parties hereto expressly understand and
agree that Duke shall have no authority to act for, represent or bind the
Company or any affiliate thereof in any manner, except as may be agreed to
expressly by the Company in writing from time to time.
11. Miscellaneous.
(a) This Agreement between the Company and Duke
constitutes the entire agreement and understanding of the parties hereto, and
supersedes any and all previous agreements and
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understandings, whether oral or written, between the parties with respect to the
matters set forth herein.
(b) All communications hereunder, except as
herein otherwise specifically provided, shall be in writing and, if sent to
Duke, shall be mailed, delivered or telegraphed and confirmed to Duke & Co.,
Inc., 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: President, with a
copy to Zimet, Haines, Xxxxxxxx & Xxxxxx, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Xxxxx Xxxxxx Xxxxxx, Esq., and if to the Company, shall be
mailed, delivered or telegraphed and confirmed to IFS International, Inc.,
Rensselaer Technology Park, 000 Xxxxxx Xxxx, Xxxx, Xxx Xxxx 00000, Attention:
Chairman, with a copy to Xxxxxx Xxxxxx Xxxxxx & Xxxx, 000 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxx X. XxXxxxxxxx, Esq.
(c) This Agreement shall be binding upon and inure to
the benefit of each of the parties hereto and their respective successors, legal
representatives and assigns.
(d) This Agreement may be executed in any number of
counterparts, each of which together shall constitute one and the same original
document.
(e) No provision of this Agreement may be amended,
modified or waived, except in a writing signed by all of the parties hereto.
(f) This Agreement shall be construed in accordance
with and governed by the laws of the State of New York, without giving effect to
its conflict of law principles.
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The parties hereby agree that any dispute which may arise between them arising
out of or in connection with this Agreement shall be adjudicated before a court
located in New York City, and they hereby submit to the exclusive jurisdiction
of the courts of the State of New York located in New York, New York and of the
federal courts in the Southern District of New York with respect to any action
or legal proceeding commenced by any party, and irrevocably waive any objection
they now or hereafter may have respecting the venue of any such action or
proceeding brought in such a court or respecting the fact that such court is an
inconvenient forum, relating to or arising out of this Agreement, and consent to
the service of process in any such action or legal proceeding by means of
registered or certified mail, return receipt requested, in care of the address
set forth in Paragraph 11(b) hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, as of the day and year first above written.
DUKE & CO., INC.
By:_________________________
Name:
Title:
IFS INTERNATIONAL, INC.
By:_________________________
Name:
Title:
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