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EXHIBIT 99.5
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▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
September 18, 2001
▇▇▇▇▇ ▇▇▇▇▇▇ III
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Dear ▇▇▇▇▇:
This letter will confirm certain understandings between ▇▇▇▇ ▇▇▇▇▇▇▇ (the
"undersigned"), Synergy Brands Inc., a Delaware corporation ("SYBR"), and you
relating to the offering (the "Offering") by SYBR of up to 200,000 units (each
unit consisting of four shares of SYBR's common stock ("Common Stock") and a
warrant to purchase one share of Common Stock). You have subscribed for units in
the Offering.
In order to induce you to purchase the units you have subscribed for in the
Offering, and in consideration thereof:
I. The undersigned covenants and agrees with you as follows:
A. For so long as (i) you, together with such other persons,
trusts and other business entities controlling, controlled by or under common
control with you (and your heirs and legal representatives) beneficially owns at
least 625,000 shares of common Stock (as adjusted for stock splits, combinations
and other like events), and (ii) the undersigned is an executive officer of
SYBR, the undersigned will use all reasonable efforts to cause to be nominated
for election to the Board of Directors of SYBR (the "Board"), initially to fill
a vacancy existing or created on the Board and thereafter at each annual meeting
of SYBR's stockholders or any special meeting in lieu thereof, one individual
designated by you and who shall be reasonably acceptable to the Board (the
"Investor Designee"). For purposes of clause (i) above, the shares of
outstanding Common Stock owned by you shall mean and include the total number of
shares of Common Stock over which you (and such other persons, trusts and other
business entities described above) have voting or dispositive power plus the
number of shares of Common Stock underlying any warrants or other convertible or
derivative securities over which you (and such other persons, trusts and other
business entities described above) have voting or dispositive power, in each
case at the time of calculation.
B. In the event any Investor Designee shall be unable or
unwilling to serve as a director of SYBR, or shall resign or be removed as a
director, you shall have the right to designate a
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September 18, 2001
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replacement in accordance with the provisions of Section A above and the
obligations of the undersigned as provided in said Section A shall apply with
respect to such replacement.
C. For so long as the condition set forth in clause (i) of
Section A above is met (even if the condition set forth in clause (ii) of
Section A above is not met), the undersigned covenants and agrees to vote all
the shares of any class of capital stock of SYBR at any time owned beneficially
by the undersigned, including all securities having voting rights issued or
issuable in respect thereof, and which the undersigned is entitled to vote, in
favor of, and to take all other necessary or desirable actions within my
control (whether as a stockholder, director or officer of SYBR or otherwise,
including without limitation attendance at meetings in person or by proxy for
purposes of obtaining a quorum and execution of written consents in lieu of
meetings), so that any Investor Designee will be elected as a director at any
annual or special meeting of SYBR or will fill any vacancy created by the Board
or by the resignation or removal of an Investor Designee.
D. The undersigned acknowledges and agrees that performance by
him of his obligations hereunder will confer a unique benefit on you and that a
failure of such performance will result in irreparable harm to you and will
not be compensable by money damages. The undersigned therefore agrees that this
agreement shall be specifically enforceable by you and that specific
enforcement and injunctive relief shall be a remedy properly available to you
for any breach of any agreement herein by the undersigned.
II. SYBR represents, warrants, covenants and agrees with you as
follows:
A. The execution and delivery of this Agreement does not, and
the consummation of the transactions contemplated hereby will not (i)
contravene, result in any breach of, or constitute a default under, SYBR's
charter or bylaws, or any other agreement or instrument to which SYBR is bound
or by which SYBR or any of its properties may be bound or affected or (ii)
violate, conflict with or result in a breach of any of the terms, conditions or
provisions of any order, judgment, decree, or ruling of any court, arbitrator
or governmental authority applicable to SYBR or its properties or assets.
B. At any time after the acceptance of your subscription by
SYBR, in whole or in part, SYBR covenants to you that immediately upon receipt
of your written request, it will pay you consulting fees relating to SYBR's
business and affairs, including the Offering, up to a maximum amount of $10,000.
III. The parties further agree as follows.
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September 18, 2001
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A. Your rights under Articles I and II of this Agreement
may not be assigned or transferred by you without the prior written consent of
the undersigned and SYBR, respectively.
B. Neither this Agreement nor any provision hereof may be
amended, modified, supplemented or waived, except by a written instrument
signed by you and, in the case of Article I, the undersigned and, in the case
of Article II, SYBR.
C. In the event that any provision of this Agreement or
the application thereof becomes or is declared by a court of competent
jurisdiction to be illegal, void or unenforceable, the remainder of this
Agreement will continue in full force and effect and the application of such
provision to other persons or circumstances will be interpreted so as
reasonably to effect the intent of the parties hereto. The parties further
agree to replace any such void or unenforceable provisions of this Agreement
with a valid enforceable provision that will achieve, to the extent possible,
the economic, business and other purposes of such void or enforceable
provision.
D. This Agreement may be executed in one or more
counterparts, each of which shall be deem an original, and together shall
continue one and the same instrument.
E. The construction, validity and interpretation of this
Agreement will be governed by the laws of the State of New York without giving
effect to the conflicts of laws principles thereof.
Please confirm that the forgoing is in accordance with your understanding
by signing the enclosed copy of this letter in the space provided below and
return it to the undersigned.
Sincerely yours,
▇▇▇▇ ▇▇▇▇▇▇▇
SYNERGY BRANDS INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
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▇▇▇▇ ▇▇▇▇▇▇▇, Chairman
CONFIRMED this 18th day of
September, 2001
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇
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