I-FIGHT, INC.
I-FIGHT,
INC.
Dated
as
of: August 15, 2006
Hunter
World Markets, Inc.
0000
Xxxxxxxx Xxxxxxxxx
Xxxxxxxxx
Xxxxx
Xxxxxxx
Xxxxx, XX 00000
Ladies
and Gentlemen:
The
undersigned, I-Fight, Inc. (the “Company”), hereby agrees with Hunter World
Markets, Inc. (“Hunter”) as follows:
1. Placement.
The
Company hereby engages Hunter to act as its exclusive placement agent in a
transaction on a “best efforts” basis involving the issuance and sale by the
Company (the “Offering”) of units (the “Units”), each Unit consisting of three
shares of the Company’s Common Stock (“Share”) and a three year warrant
(“Investor Warrant”) to purchase one Share at an exercise price per Share of two
times the purchase price attributable to one Share (the “Per Share Purchase
Price”). The Warrant shall not have a cashless exercise feature. The price per
Unit shall be based on a pre-money valuation of $25,000,000. The Shares and
Warrants will have anti-dilution price protection on a weighted average basis
for securities issued by the Company for a two-year period after the Closing
except for securities issued (a) pursuant to the Company’s Stock Compensation
Plans; (b) pursuant to strategic financings; and (c) for acquisitions. The
Offering shall be for a minimum amount of $7,000,000 and a maximum of
$10,000,000. Concurrently with the closing of the Offering, the shareholders
of
the Company shall have transferred all their shares of capital stock to a public
company in exchange for shares of such public company (the “Reverse Merger”).
Hunter shall assist the Company in identifying and structuring the acquisition
of an appropriate public company (“Pubco”). Such services are referred to herein
as the “Reverse Merger Services.” Hunter shall be responsible for the cost of
acquiring a controlling interest in the public company. Upon consummation of
the
Reverse Merger, the shareholders of the Company will collectively own 90.1%
of
Pubco on a fully diluted basis prior to giving effect to the
Offering.
The
Company shall file an SB-2 registration statement (“Registration Statement”) no
later than forty-five (45) days following the closing of the Offering pursuant
to the terms of a Registration Rights Agreement. The Company will use its best
efforts to have it declared effective 120 days after the closing of the Offering
(the “Closing”). The securities to be included in the SB-2 registration
statement are the Shares and the Common Stock issuable pursuant to the exercise
of the Investor Warrants, the Bridge Warrants and Placement Agent Warrants
(as
such terms are defined herein). No additional securities shall be included
unless the Company shall have first received Hunter’s prior written consent. The
Registration Rights Agreement will set forth certain liquidated damage payments
if the Registration Statement is not timely filed or declared effective within
the time period set forth in such Agreement.
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All
moneys raised in the Offering shall be placed in a non-interest bearing account
until the minimum-funding amount is deposited. Upon Closing, proceeds shall
first be applied to pay off any interest and principal outstanding under the
Bridge Loan (as defined herein).
Hunter
shall not be obligated to sell any Units and this Offering by Hunter shall
be
solely on a “best efforts basis.”
The
initial term of this Agreement shall be for a period from the date of this
Agreement until November 30, 2006 unless terminated sooner by the mutual written
agreement of the Company and Hunter. The period commencing on the date of
execution of this Agreement and ending on November 30 2006 is referred to herein
as the “Placement Term.”
The
Company shall prepare a Private Placement Memorandum which shall be true and
correct in all material respects. The Offering shall be conducted pursuant
to
Regulation D promulgated by the Securities and Exchange Commission (the “SEC”)
and shall be offered and sold only to “Accredited Investors” as that term is
defined in Regulation D. The Offering is intended to qualify as a Regulation
D,
Rule 506 transaction. The purchase of the Units shall be pursuant to the terms
of a Unit Purchase Agreement among the purchasers of the Units, on the one
hand,
and the Company, on the other hand, on terms and conditions acceptable to Hunter
(the “Purchase Agreement”).
2. Bridge
Loan.
Hunter
shall use its best efforts to arrange a bridge loan (the “Bridge Loan”) of
$350,000 pursuant to a promissory note (the “Note”) to be repaid on the earlier
to occur of the Closing or six months from the date of the Note. The Company
shall pay a Bridge Loan Fee of $43,750 payable on the maturity date of the
Bridge Loan. The lender of the Bridge Loan will receive three-year warrants
(the
“Bridge Warrants”) to purchase such number of shares equal to the principal
amount of the Note divided by the Per Share Purchase Price. The exercise price
of the Bridge Warrants shall be 60% of the Per Share Purchase Price. It shall
be
a condition of the Bridge Loan that one or more of the shareholders of the
Company lend to the Company an aggregate of $250,000 on the same terms as the
Bridge Loan.
3. Compensation.
As
compensation for the Units sold, Hunter will receive the following: (i) 10%
commission on the total gross proceeds raised by Hunter and 5% on total gross
proceeds not raised by Hunter, excluding in both cases funds raised by parties
other than Hunter in connection with strategic financings; (ii) warrants to
purchase Shares equal to 20% of the Shares sold in the Offering (the “Placement
Agent Warrants”); and (iii) $200,000 for the Reverse Merger Services.
The
Placement Agent Warrants will receive registration rights identical to the
rights granted to the Purchasers. The Placement Agent Warrants will be
exercisable at the same per Share price as the Warrants and have a five (5)
year
term. The Warrants shall have a cashless exercise feature.
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4. Exclusivity.
(a) During
the Placement Term, Hunter shall have the exclusive right to act as placement
agent, except that, (a) subject to Hunter’s consent, the Company may appoint a
co-placement agent, it being understood, however, that any agreement with any
co-placement agent shall prohibit such agent from soliciting investors outside
the United States and shall contain a three-year non-circumvention agreement,
and (b) subject to Hunter’s approval of the investors, the Company and its
affiliates may sell Units.
(b) Except
as
set forth in subparagraph (a), the Company may not solicit, engage or
continue to work with any underwriters, third party finders, brokers, or other
consultants, during the Placement Term, without express written approval of
Hunter. During the Placement Term, the Company shall provide Hunter with the
name and other pertinent information on any potential investor.
5. Right
of First Refusal.
Provided
that the minimum Offering is completed, Hunter shall have the right of first
refusal (the “Right of First Refusal”) for any equity financing entered into by
the Company within twelve months from the date the Registration Statement
becomes effective. The Right of First Refusal shall not apply to any strategic
partner financing whereby an investor brings qualitative value in addition
to
money being invested.
6. Representations,
Warranties and Covenants of Hunter.
Hunter
represents, warrants and covenants as follows:
(a) Hunter
has the necessary power to enter into this Agreement and to consummate the
transactions contemplated hereby.
(b) The
execution and delivery by Hunter of this Agreement and the consummation of
the
transactions contemplated herein will not result in any violation of, or be
in
conflict with, or constitute a default under, any agreement or instrument to
which Hunter is a party or by which Hunter or its properties are bound, or
any
judgment, decree, order or, to Hunter’s knowledge, any statute, rule or
regulation applicable to Hunter. This Agreement, when executed and delivered
by
Hunter, will constitute the legal, valid and binding obligations of Hunter,
enforceable in accordance with their respective terms, except to the extent
that
(i) 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, (ii) the enforceability
hereof or thereof is subject to general principles of equity, or (iii) the
indemnification provisions hereof or thereof may be held to violate public
policy.
(c) Hunter
will not deliver any documents related to the Offering to any person it does
not
reasonably believe to be an Accredited Investor based upon documentary evidence
thereof, where appropriate.
(d) Hunter
will not intentionally take any action that it reasonably believes would cause
the Offering to violate the provisions of the Securities Act of 1933, the
Securities Exchange Act of 1934, the respective rules and regulations
promulgated thereunder (the “Rules and Regulations”) or applicable “Blue Sky”
laws of any state or jurisdiction.
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(e) Hunter
shall use all reasonable efforts to determine (i) whether the Investor is an
Accredited Investor and (ii) that any information furnished by the Investor
is
true and accurate. Hunter shall have no obligation to insure that any check,
note, draft or other means of payment for the Units will be honored, paid or
enforceable against the Investor in accordance with its terms.
(f) Hunter
is
a member of the NASD, and is a broker-dealer registered as such under the
Securities Exchange Act of 1934 and under the securities laws of the states
in
which the Units will be offered or sold by Hunter, unless an exemption for
such
state registration is available to Hunter. Hunter is in compliance with all
material rules and regulations applicable to Hunter generally and applicable
to
Hunter’s participation in the Offering.
7. Representations
and Warranties of the Company.
The
Company represents and warrants as follows:
(a) The
execution, delivery and performance of this Agreement has been or will be duly
and validly authorized by the Company and will be, a valid and binding agreement
of the Company, enforceable in accordance with its respective terms, except
to
the extent that (i) 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, (ii) the
enforceability hereof or thereof is subject to general principles of equity
or
(iii) the indemnification provisions hereof or thereof may be held to violate
public policy. The securities to be issued pursuant to the transactions
contemplated by this Agreement have been duly authorized and, when issued and
paid for in accordance with (x) this Agreement and (y) the
certificates/instruments representing such securities, 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, (2) the
enforceability thereof is subject to general principles of equity, or (iii)
the
indemnification provisions hereof or thereof may be held to violate public
policy. 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.
(b) The
outstanding capital stock of the Company have been duly authorized and issued
and the Company has outstanding capitalization as will be set forth in the
Purchase 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, the
agreements described herein or as set forth in the Purchase 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.
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(c) The
Shares being offered in the Offering and issuable upon exercise of the Investor
Warrants, the Bridge Warrants and Placement Agent Warrants will be duly
authorized and when issued and paid for in accordance with this Agreement and
proper exercise of such warrants, respectively, 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.
(d) 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 to be
owned or leased by the Company).
(e) 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.
(f) The
Company is not aware of any federal or securities violations by any of its
current officers, directors or consultants, nor does the Company believe that
any of its officers, directors or consultants are or were the subject of any
enforcement proceedings by the Securities Exchange Commission or the National
Association of Securities Dealers.
(g) The
Company has been duly organized and is validly existing as a corporation in
good
standing under the laws of the State of California. 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 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 business (and
proposed business), and the Company is doing business in strict compliance
with
all such authorizations, approvals, orders, licenses, certificates and permits
and all foreign, federal, state and local laws, rules and regulations concerning
the business in which it is engaged. The Company has all power and authority
to
enter into this Agreement, to carry out the provisions and conditions hereof,
and all consents, authorizations, approvals and orders required in connection
herewith 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 except for applicable federal and
state securities laws. The Company, in the last three years, has not incurred
any liability arising under or as a result of the application of any of the
provisions of the Securities Act of 1933, the Securities Exchange Act of 1934
or
the Rules and Regulations.
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(h) 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 (other
than the obligation to hold annual meetings of its shareholders and related
matters) or in violation of any franchise, license, permit, judgment, decree
or
order, or in violation of any statute, rule or regulation. Neither the execution
and delivery of this Agreement, nor the issuance and sale or delivery of the
securities, nor the consummation of any of the transactions contemplated herein,
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) 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 Hunter of its obligations
hereunder, any statute or any 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.
(i) The
representations of the Company in the Purchase Agreement shall be true and
correct as of the date of the Closing.
(j) There
are
no claims for services in the nature of a finder’s or origination fee with
respect to the sale of the Units, or the securities comprising a part thereof,
or any other arrangements, agreements or understandings that may affect Hunter's
compensation.
(k) 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 and to the best of the Company’s knowledge 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 except
any claim or action that would not have a material adverse effect on the
Company; to the best of the Company’s knowledge, the Company’s current products,
services or processes do not infringe or will not infringe on the patents
currently held by any third party.
(l) Except
in
the ordinary course of business, 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.
(m) Subject
to the performance by Hunter of its obligations hereunder, the offer and sale
of
the Units will comply, up to the Placement Term, in all material respects with
the requirements of Rule 506 of Regulation D promulgated by the SEC pursuant
to
the Securities Act of 1933 and any other applicable federal and state laws,
rules, regulations and executive orders. The Company will not cause or knowingly
permit any action to be taken in connection with the placement which violates
the Securities Act of 1933 or any state securities laws.
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(n) All
taxes
which are due and payable from the Company have been paid in full and the
Company does not have any tax deficiency or claim outstanding assessed or
proposed against it.
(o) None
of
the Company nor to the best of the Company’s knowledge 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 (i) might subject
the
Company to any damage or penalty in any civil, criminal or governmental
litigation or proceeding, or (ii) 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, or (iii) if not continued
in
the future, might adversely affect the assets, business, operations or prospects
of the Company in the future.
(p) All
information and statements provided by the Company to prospective investors
will
be true and correct.
(q) Any
written offering material prepared by the Company will not be misleading or
violative of the anti-fraud provisions of the Securities Exchange Act of 1934.
(r) The
financial statements presented to Hunter fairly reflect the financial condition
of the Company and the results of its operations at a time and for the periods
covered by the financial statements.
8. Certain
Covenants and Agreements of the Company.
The
Company covenants and agrees at its expense and without any expense to Hunter
as
follows:
(a) To
advise
Hunter 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 Purchase Agreement
occurring at any time prior to the closing of any Shares as soon as the Company
is either informed or becomes aware thereof.
(b) The
Company shall at all times have sufficient shares authorized and unissued to
keep available out of its authorized Common Stock solely for the purpose of
issuance upon the exercise of all Warrants described in this Agreement, such
number of shares of Common Stock as shall then be issuable upon the exercise
or
conversion thereof.
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(c) 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.
(d) To
cooperate with Hunter as to permit the Offering to be conducted in a manner
consistent with the applicable state and federal securities.
(e) To
not
cause or knowingly permit any action to be taken in connection with the
placement which violates the Securities Act of 1933 or any State securities
laws.
9. Indemnification.
(a) The
Company hereby agrees that it will indemnify and hold Hunter and each officer,
director, shareholder, employee, attorneys, accountants, agents or
representative of Hunter, and each person controlling, controlled by or under
common control with Hunter within the meaning of Section 15 of the Securities
Act of 1933 or Section 20 of the Securities Exchange Act of 1934 or the SEC’s
rules and regulations promulgated thereunder (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 including attorneys’ fees in the event of a
breach of this representation and warranty) to which Hunter or such indemnified
person of Hunter may become subject under the Securities Act of 1933, the
Securities Exchange Act of 1934, 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) this Agreement, (b) any written offering material prepared
by
the Company (except those written statements relating to Hunter 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 Units, the Common Stock and the Warrants 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 Section 8(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 Hunter or such indemnified person as a direct
result of Hunter or such person’s gross negligence or willful misfeasance will
be promptly repaid to the Company.
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(b) Hunter
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 Securities Act of 1933 or Section 20
of
the Securities Exchange Act of 1934 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 Securities Act of 1933, the Securities Exchange Act
of
1934, 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 Hunter or its officers, employees or representatives in acting as
placement agent for the Offering or (ii) the breach of any representation,
warranty, covenant or agreement made by Hunter in this Agreement.
(c) Promptly
after receipt by an indemnified party of notice of commencement of any action
covered by Section 8(a) or 8(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 8(a) or
8(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 8(a) or 8(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 Hunter 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 Hunter 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
Hunter 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 Securities Act of 1933 shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 9(d), any person
controlling, controlled by or under common control with Hunter, or any partner,
director, officer, employee, representative or any agent of any thereof, shall
have the same rights to contribution as Hunter and each person controlling,
controlled by or under common control with the Company within the meaning of
Section 15 of the Securities Act of 1933 or Section 20 of the Securities
Exchange Act of 1934 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 8(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 8 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. Notwithstanding anything to the contrary in
this
Section 8, no party shall be liable for contribution with respect to the
settlement of any claim or action effected without its written
consent.
10. Non-Circumvention.
Pursuant
to this Agreement, it is contemplated that Hunter shall supply to the Company
and its officers and directors a certified list (the “Certified List”) of
investors and customers that Hunter has contacted in connection with the
Offering. If, during the twelve month period after the Placement Term, the
Company completes a Transaction (as defined below) with a person on the
Certified List, the Company shall pay Hunter concurrently with the closing
of
such Transaction the compensation due under Section 2 of this
Agreement.
“Transaction”
shall be defined as any direct or indirect sale, transfer, conveyance, exchange,
financing, investment, trade, exchange or other change in legal or beneficial
ownership of any property, whether accomplished by an issuance or purchase
of
assets of securities, merger, consolidation, management contract, joint venture,
partnership, trade or exchange of assets or stock or otherwise.
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11. Payment
of Expenses.
The
Company hereby agrees to bear all of its expenses in connection with the
Offering, including, but not limited to the following: filing fees, printing
and
duplicating costs, Company approved advertisements, road show costs and
expenses, Tombstone ad not to exceed $10,000 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, fees of
counsel to the Placement Agent in the amount of $20,000, and accountants, issue
and transfer taxes, if any.
12. Conditions
of Closing.
The
closing of this Offering shall be held at the offices of Company’s counsel or as
otherwise determined by Hunter and the Company. The obligations of Hunter
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 the closing
date with respect to the Company as if it had been made on and as of such
closing date; the accuracy on and as of the closing 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 the closing of its covenants and
obligations hereunder and to the following further conditions:
(a) At
or
prior to the closing, counsel for Hunter 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.
(b) At
and
prior to the closing, (i) there shall have been no material adverse 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 Hunter 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 (vi) 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.
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(c) At
the
closing, Hunter shall have received a certificate of the Company signed by
its
chief executive officer, dated as of the applicable closing date, to the effect
that the conditions set forth in subparagraph (b) above have been satisfied
and
that, as of the applicable closing date, the representations and warranties
of
the Company set forth herein are true and correct.
(d) The
Reverse Merger shall have been consummated.
13. 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, addressed as
follows:
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To
Hunter:
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Hunter
World Markets, Inc.
0000
Xxxxxxxx Xxxxxxxxx
Xxxxxxxxx
Xxxxx
Xxxxxxx
Xxxxx, XX 00000
Attention:
Xxxx Xxxxxx
Telephone:
(000) 000-0000
Fax:
(000) 000-0000
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with
a copy to:
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|
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To
the Company:
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0000
Xxxxxx Xxxxxxxxx, Xxxxx 000
Xxx
Xxxxxxx, Xxxxxxxxxx 00000
Attention:
Xxxxx Xxxxxxxx
Telephone:
(000) 000-0000
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with
a copy to:
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Xxxx
& Xxxxx PC
0000
Xxxxxxx Xxxx Xxxx
Xxxxx
0000
Xxx
Xxxxxxx, XX 00000-0000
Attention:
Xxxxx Xxxxxxxx
Telephone:
(000) 000-0000
Fax:
(000) 000-0000
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or
to
such other address of which written notice is given to the others.
(c) This
Agreement shall be construed pursuant to the laws of the State of California
without regard to conflicts of law principals thereof. Any controversy arising
hereunder shall be resolved by arbitration from the American Arbitration
Association.
(d) This
Agreement 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.
(f) In
the
event that the minimum funding is not obtained prior to the expiration of the
Placement Term, this Agreement shall immediately terminate without further
action on the part of the Company or Hunter.
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date
first written above.
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I-FIGHT,
INC.
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/s/
Xxxxx
Xxxxxxxx
By: Xxxxx
Xxxxxxxx
Its: Chief
Executive Officer
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AGREED
AND ACCEPTED
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HUNTER
WORLD MARKETS, INC.
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__________________________________
By: Xxxx
Xxxxxx
Its: President
and CEO
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