INVESTMENT BANKING AGREEMENT (this
"Agreement") dated April 17, 1997, between AVAX
TECHNOLOGIES, INC., a Delaware corporation ("AVAX"),
and HILL, THOMPSON, XXXXX & CO. ("HTM").
In consideration of the mutual covenants contained herein and intending to
be legally bound thereby, AVAX and HTM hereby agree as follows:
SECTION 1. For a period of one year from the date hereof, at the written
request of AVAX, HTM will perform investment banking services for AVAX on the
terms set forth below. Such services will be performed on a best efforts basis,
and will include, without limitation, assistance to AVAX in mergers,
acquisitions and internal capital structuring and the placement of new debt and
equity issues of AVAX, all with the objective of accomplishing AVAX's business
and financial goals. In each instance, HTM shall endeavor, subject to market
conditions, to assist AVAX in identifying sources of private and institutional
funds; to provide planning, structuring, strategic and other advisory services
to AVAX; and to assist in negotiations on behalf of AVAX. In each instance, HTM
will render such services as to which AVAX and HTM mutually agree and HTM will
exert its best efforts to accomplish the goals agreed to by HTM and AVAX. No
provision in this Agreement shall be construed as to require AVAX to pay any fee
or other compensation (other than as set forth in Sections 3 and 6) to HTM on
account of the services to be provided by HTM as set forth in this Section 1 or
as otherwise contemplated by this Agreement unless such fee or compensation is
set forth in a separate written agreement between AVAX and HTM as contemplated
by Section 6. In addition, the relationship set forth herein is nonexclusive in
nature and nothing contained herein shall require AVAX to request or utilize the
services of HTM as set forth herein and AVAX may without restriction retain
others to perform the same or similar services without incurring any obligation,
financial or otherwise, to HTM.
SECTION 2. In connection with the performance of this Agreement, HTM and
AVAX shall comply with all applicable laws and regulations, including, without
limitation, those of the National Association of Securities Dealers, Inc.
("NASD"), and the Securities and Exchange Commission ("SEC").
SECTION 3. In consideration of the services previously rendered and to be
rendered by HTM hereunder, HTM is hereby granted Warrants in the form attached
as Exhibit A hereto to purchase, at a price of $4.00 per share, a total of
100,000 shares of Common Stock, par value $.002 per share ("Common Stock") of
AVAX. Such Warrants ("HTM Warrants") may be exercised at any time from July 17,
1997 to and including July 17, 2002. The HTM Warrants will be issued to the NASD
registered representatives of HTM in the names and amounts set forth on Schedule
3 hereto. Such Warrants shall vest and become irrevocable as follows: 50% of
such Warrants (50,000 in the aggregate) 60 days after the date of this
Agreement; 25% of such Warrants (25,000 in the aggregate) 180 days after the
date of this Agreement, and an additional 25% of such Warrants (25,000 in the
aggregate) 365 days after the date of this Agreement. The Warrants and the
shares of Common Stock issuable upon exercise of the Warrants shall contain a
legend satisfactory in form and substance to AVAX and its counsel. HTM
understands that the HTM Warrants have
not been registered under the Securities Act of 1933 (the "Act") by reason
of a claimed exemption under the provisions of the Act which depends, in part,
upon the investment intention of HTM. In this connection, HTM hereby represents
that (a) HTM is acquiring the HTM Warrants for investment purposes only and not
with a view to or for sale in connection with any distribution of the HTM
Warrants; (b) HTM was not formed for the purpose of acquiring the HTM Warrants;
(c) HTM has such sophistication, knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of its
investment; (d) HTM has the ability to bear the economic risks of its investment
for an indefinite period of time and could afford a complete loss of its
investment; and (e) it has had access to information, and the opportunity prior
to its purchase of the HTM Warrants to ask questions of and receive answers from
representatives of AVAX, in each case concerning the finances, operations and
business of AVAX. HTM understands that Rule 144 promulgated under the Act
requires, among other conditions, an extensive holding period prior to the
resale (in limited amounts) of securities acquired in a non-public offering
without having to satisfy the registration requirements under the Act and that
the warrants and the shares of Common Stock issuable upon exercise of the
Warrants will not be entitled to registration rights.
SECTION 4. Pursuant to Section 2710(c)(7)(A) of the NASD Corporate Financing
Rules, the HTM Warrants may be issued to HTM and its bona fide officers and
employees only and shall not be sold, transferred, assigned or pledged or
hypothecated by any person for a period of one year from the date hereof.
Accordingly, the HTM Warrants and the shares of Common Stock issuable upon
exercise of the Warrants will contain an appropriate legend describing the
restriction set forth above the time period for which the restriction is
operative.
SECTION 5. If AVAX should, at any time, or from time to time hereafter, effect a
stock split, a reverse stock split of its shares of Common Stock, or a
recapitalization of its shares of Common Stock, the terms of the HTM Warrants
shall be proportionately adjusted to prevent the dilution or enlargement of the
rights of the holders thereof.
SECTION 6. HTM shall be entitled to normal and ordinary compensation, to be
negotiated and set forth in a separate written agreement between HTM and AVAX,
arising out of any transactions that are proposed or executed by HTM and
consummated by AVAX, or are executed by HTM at AVAX's request, during the term
of this Agreement. In addition, upon reasonable presentation or reasonable
documentation therefore, HTM shall be reimbursed by AVAX for any reasonable
out-of-pocket expenses that HTM may incur in connection with rendering any
service to or on behalf of AVAX that is approved, in writing, in advance by the
Chief Executive Officer of AVAX.
SECTION 7. AVAX agrees to indemnify and hold HTM and its directors, officers and
employees harmless from and against any and all losses, claims, damages,
liabilities, costs or expenses arising out of any action or cause of action
brought against HTM in connection with its rendering services under this
Agreement except for any losses, claims, damages, liabilities, costs or expenses
resulting from any violation by HTM of applicable laws and regulations
including, without limitation, those of the NASD and the SEC or any state
securities commission or from any act of
2
HTM involving gross negligence or willful misconduct and except that AVAX
shall not be liable for any amount paid in settlement of any claim that is
settled without its prior written consent.
SECTION 8. HTM shall enter into a confidentiality agreement with the
Company in substantially the form attached as Exhibit B hereto.
SECTION 9. HTM agrees to indemnify and hold AVAX and its directors,
officers and employees harmless from and against any and all losses, claims,
damages, liabilities, costs or expenses resulting from any violation by HTM of
applicable laws and regulations including, without limitation, those of the
NASD, the SEC, any state securities commission or from any act of HTM involving
gross negligence or willful misconduct.
SECTION 10. HTM acknowledges that certain of the information that it has
and will be obtaining about AVAX in connection with the transactions
contemplated by this Agreement may constitute material non-public or "inside"
information about AVAX, and that the use or misuse of such information might
involve serious legal consequences. HTM recognizes it responsibility for
compliance with Federal securities laws in connection with any such activities.
SECTION 11. Nothing contained in this Agreement shall be construed to
constitute HTM as a partner, employee, or agent of AVAX; nor shall either party
have any authority to bind the other in any respect, it being intended that HTM
is, and shall remain, an independent contractor.
SECTION 12. This Agreement may not be assigned by either party hereto (and
any purported assignment shall be void ab initio), shall be interpreted in
accordance with the laws of the State of New York, and shall be binding upon the
successors of the parties. Either party may terminate this investment banking
contract at any time; provided, however, that Warrants legally vested in
accordance with paragraph 3 will remain vested and all unvested Warrants will be
canceled.
SECTION 13. If any paragraph, sentence, clause or phrase of this Agreement
is for any reason declared to be illegal, invalid, unconstitutional, void or
unenforceable, all other paragraphs, sentences, clauses or phrases hereof not so
held shall be and remain in full force and effect.
SECTION 14. None of the terms of this Agreement shall be deemed to be
waived or modified except by an express agreement in writing signed by the party
against whom enforcement of such waiver or modification is sought. The failure
of either party at any time to require performance by the other party of any
provision hereof shall, in no way, affect the full right to require such
performance at any time thereafter. The waiver by either party of a breach of
any provision hereof shall not be deemed or held to be a waiver of any
succeeding breach of such provision or as a waiver of the provision itself.
SECTION 15. Any dispute, claim or controversy arising out of or relating to
this Agreement, or the breach thereof, shall be settled by arbitration in New
York City, New York, in
3
accordance with the Commercial Arbitration Rules of the American
Arbitration Association. The parties hereto agree that they will abide by and
perform any award rendered by the arbitrator(s) and that judgment upon any such
award may be entered in any Court, state or federal, having jurisdiction over
the party against whom the judgment is being entered. Any arbitration demand,
summons, complaint, other process, notice of motion, or other application to an
arbitration panel, Court or Judge, and any arbitration award or judgment may be
served upon any party hereto by registered or certified mail, or by personal
service, provided a reasonable time for appearance or answer is allowed.
SECTION 16. Any notice required to be given or delivered to AVAX under the
terms of this Agreement shall be in writing and addressed to AVAX at 0000 Xxxx
Xxxxxx, Xxxxx 000, Xxxxxx Xxxx, XX, 00000, Attention: Xxxxxxx X. Xxxxx, M.D.,
with a copy to Xxxxxxx, Xxxxxxxx & Kotel, a Professional Corporation, Tower
Forty-Nine, 12 East 49th Street, 30th Floor, New York, N.Y. 10017, Attention:
Xxx X. Xxxxx, Esq. or such other address as shall be provided in writing to HTM.
Any notice required to be given or delivered to HTM shall be in writing and
addressed to HTM at 00 Xxxxxxxxxx Xxxxxx, Xxxxxx Xxxx, X.X. 00000, Attention:
Xxxxxxx Xxxx, or such other address as shall be provided in writing to AVAX. All
notices shall be deemed effective upon personal delivery or upon deposit in the
U.S. mail, postage prepaid and properly addressed to the party to be notified.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year set forth above.
AVAX TECHNOLOGIES, INC.,
By: /s/ Xx. Xxxxxxx X. Xxxxx
Name: Xx. Xxxxxxx X. Xxxxx
Title: President and Chief
Executive Officer
HILL, THOMPSON, XXXXX & CO.,
By: /s/ Xxxxxxx Xxxx
Name: Xxxxxxx Xxxx
Title: President
Schedule 3
HTM WARRANT DISTRIBUTION
Recipient Amount of Warrants Received*
Xxxxxxxx Xxxxxx 50,000
Xxxxxxx Xxxx 12,500
Xxxxxx Xxxxxxxxxxx 12,500
Xxxx Xxxxx 12,500
Xxx Xxxxxxx 12,500
* Such Warrants shall vest in accordance with the fourth sentence of Section 3
herein.
EXHIBIT B
CONFIDENTIALITY AGREEMENT (this "Agreement")
dated as of April 17, 1997, between
AVAX TECHNOLOGIES, INC.,
a Delaware corporation ("AVAX"), and HILL, THOMPSON,
XXXXX & CO. (the "Recipient").
In connection with services to be rendered unto AVAX by the Recipient
pursuant to that certain Investment Banking Agreement (the "Investment Banking
Agreement") dated April 17, 1997, the Recipient desires to receive information
about AVAX's business and technology. In order to facilitate the exchange of
Confidential Information (as defined below) relating to such business and
technology, the Recipient agrees for the benefit of AVAX as follows:
1. AVAX may make Confidential Information concerning itself available to
the Recipient exclusively for the purpose of performing its services under the
Investment Banking Agreement. Such Confidential Information may be provided
directly by AVAX or on behalf of AVAX by one of its Representatives (as defined
below). "Confidential Information" means any and all information (including,
without limitation, information relating to products, processes, technologies,
compounds, inventions, know-how, designs, specifications, formulas, methods,
samples, biological, chemical or other materials, developmental or experimental
work, improvements, discoveries, past, current, planned and future research and
clinical or other data, databases, software, manuals, internal policies and
procedures, patent applications, licenses, research and development agreements,
term sheets, prices, costs, financial information, budgets, projections,
marketing, selling and business plans, vendors, suppliers, customers, and
information regarding the skills and compensation of Representatives of AVAX or
its affiliates) that AVAX or its Representatives furnish or otherwise make
available to the Recipient directly or indirectly, together with all analyses,
compilations, studies or other documents prepared by the Recipient or its
Representatives which contain or otherwise reflect or are derived from such
information. Notwithstanding the foregoing, the term "Confidential Information"
does not include information which (i) is already in the Recipient's possession
or control prior to the date of disclosure (provided that if such information is
known by the Recipient to be subject to another confidentiality agreement with
or other contractual, legal or fiduciary obligation of secrecy to AVAX or any of
its Representatives, nothing in this Agreement shall abrogate such other
agreement or obligation), (ii) was or becomes generally available to the public
other than as a result of a disclosure by the Recipient or any of its
Representatives or (iii) becomes available to the Recipient on a
non-confidential basis from a source other than AVAX or any of its
Representatives, provided that such source is not prohibited by a
confidentiality agreement with or other contractual, legal or fiduciary
obligation of nondisclosure to AVAX or any of its Representatives.
2. The Recipient hereby agrees that Confidential Information received
pursuant to this Agreement will be used exclusively for the purpose of
performing its services under the Investment Banking Agreement, and that such
information will be kept confidential by the Recipient, provided that any such
Confidential Information may be disclosed by the Recipient to its directors,
officers, employees, consultants, attorneys, accountants, advisors, affiliates
and
agents and other parties who need to know such Confidential Information in
order for the Recipient to evaluate AVAX (each a "Representative").
3. The Recipient shall inform each of its Representatives that receives any
Confidential Information of the confidential nature of such information and
shall direct each Representative to treat such information in accordance with
the terms of this Agreement, including, without limitation, not disclosing any
such Confidential Information to any person. The Recipient agrees, at its sole
cost and expense, to take all reasonable measures, including, without
limitation, court proceedings, to restrain its Representatives from unauthorized
disclosure or use of the Confidential Information. The term "person" as used in
this letter shall be broadly interpreted to include without limitation any
corporation, company, governmental agency or body, partnership or individual.
4. The Recipient acknowledges that it is aware, and that it will advise
each of its Representatives that is provided any Confidential Information that
the United States securities laws provide that any person who has received
directly or indirectly from an issuer such as AVAX material, non-public
information is prohibited from purchasing or selling securities of such issuer
or from communicating such information to any other person under circumstances
in which it is reasonably foreseeable that such person is likely to purchase or
sell such securities, and that violation of such prohibition may involve severe
civil and criminal penalties.
5. Except as may otherwise be provided in writing in connection with a
specific transaction, the Recipient acknowledges that neither AVAX nor any of
its Representatives will be deemed to have made any representation or warranty
as to the accuracy or completeness of any information provided pursuant to this
Agreement. The Recipient agrees that neither AVAX nor its Representatives shall
have any liability to the Recipient or any of its Representatives resulting from
the receipt or use of the Confidential Information except as may be explicitly
set forth in any definitive agreement relating to any transaction.
6. Upon written notice by AVAX, the Recipient shall promptly redeliver to
AVAX, or, if requested by AVAX, promptly destroy all written Confidential
Information and any other written material containing any information included
in the Confidential Information (whether prepared by AVAX, the Recipient, any
Representative of any party or a third party), and will not retain any copies,
extracts or other reproductions in whole or in part of such written Confidential
Information or written material (and upon request certify such redelivery or
destruction to AVAX in a written instrument reasonably acceptable to AVAX and
its counsel). Upon request of AVAX, all documents, memoranda, notes and other
writings or analyses prepared by the Recipient or its Representatives based on
the Confidential Information shall be destroyed, and such destruction shall be
certified to AVAX in a written instrument reasonably acceptable to AVAX and its
counsel.
7. In the event that the Recipient or any of its Representatives is
requested or required (by oral questions, deposition, interrogatories, requests
for information or documents, subpoena, civil investigative demand or other
process) to disclose all or any part of any Confidential Information, the
Recipient will provide AVAX with prompt notice of such request
2
or requirement so that AVAX may seek an appropriate protective order or
waive compliance with the provisions of this Agreement, as well as notice of the
terms and circumstances surrounding such request or requirement. In such case,
the parties will consult with each other on the advisability of pursuing any
such order or other legal action or available steps to resist or narrow such
request or requirement. If, failing the entry of a protective order or the
receipt of a waiver hereunder, the Recipient is, in the opinion of counsel,
legally compelled to disclose Confidential Information, the Recipient may
disclose that portion of the Confidential Information which counsel advises the
Recipient that it is legally compelled to disclose. In any event, the Recipient
will use its best efforts to obtain and will not oppose action by AVAX to obtain
an appropriate protective order or other reliable assurance that confidential
treatment will be accorded the disclosure of such information. The Recipient
will cause its Representatives to comply with this paragraph.
8. It is understood and agreed that any and all proprietary rights,
including, but not limited to, patent rights, trademarks and other intellectual
property or proprietary rights, in and to the Confidential Information disclosed
by AVAX to the Recipient shall be and remain in the possession of AVAX and the
Recipient shall have no right, title or interest in or to any of such
Confidential Information. The Confidential Information will be disclosed with
the express understanding that neither party will be obligated to enter into any
further agreement relating to the Confidential Information. In addition, nothing
in this Agreement shall be construed as the granting of a license by AVAX to the
Recipient.
9. This Agreement constitutes the entire agreement of the parties
pertaining to its subject matter, and all prior or contemporaneous
understandings or agreements, whether written or oral, between the parties with
respect to such subject matter are hereby superseded in the entirety. The
parties have made no agreements, representations or warranties relating to the
subject matter of this Agreement that are not set forth herein and no agreement,
understanding or promise subsequent to the date hereof relating to the subject
matter of this Agreement, the Confidential Information or otherwise between or
by any of the parties hereto shall be binding upon either party unless in
writing and executed by both the parties and neither party shall be entitled to
rely on oral statements made by the other party which are not contained in a
written agreement between such parties. The Agreement set forth herein may be
modified, amended or waived only by separate written agreement of each of the
parties expressly so modifying, amending or waiving such Agreement. The waiver
by either party of compliance with any provision of this Agreement by the other
party shall not operate or be construed as a waiver of such party of a provision
of this Agreement.
10. The Recipient may not assign its rights or obligations hereunder.
Nothing in this Agreement, express or implied, is intended to confer on any
person other than the parties and their respective permitted successors and
assigns any rights or remedies under or by virtue of this Agreement, and no
person shall be entitled to assert any rights as a third party beneficiary
hereunder.
11. Any notice, request or other document to be given hereunder to a party
hereto shall be effective when received and shall be given in writing and
delivered in person or sent by
3
overnight courier, registered or certified mail, postage prepaid, or by
telecopy (receipt confirmed) as follows:
If to AVAX:
Xxxxxxx X. Xxxxx, M.D.
President and Chief Executive Officer
AVAX Technologies, Inc.
Twentieth Century Tower II
0000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxx Xxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy to:
Xxx X. Xxxxx, Esq.
Xxxxxxx Xxxxxxxx & Kotel
A Professional Corporation
Tower Forty-Nine
00 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, X.X. 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
If to Recipient:
Xx. Xxxxxxxx X. Xxxxxx, Xx.
Hill, Thompson, Xxxxx & Co.
00 Xxxxxxxxxx Xxxxxx
Xxxxxx Xxxx, X.X. 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Any party hereto may change its address for receiving notices, requests and
other documents by giving written notice of such change to the other parties
hereto.
12. The Recipient agrees that monetary damages would not be a sufficient
remedy for any breach of this Agreement by it or any of its Representations and
that AVAX will be entitled to specific performance and injunctive relief as
remedies for any such breach. Such remedies shall not be deemed to be the
exclusive remedies for a breach of this Agreement but
4
shall be in addition to all other remedies available at law or equity.
13. This letter shall be governed by, and construed in accordance with, the
laws of the State of New York, without reference to the conflict of law
principles of such State to the extent that the laws of any other jurisdiction
would be applicable in lieu thereof. The parties irrevocably and unconditionally
agree that the exclusive place of jurisdiction for any action, suit or
proceeding ("Actions") relating to this Agreement shall be in the courts of the
United States of America sitting in the Borough of Manhattan in the City of New
York or, if such courts shall not have jurisdiction over the subject matter
thereof, in the courts of the State of New York sitting therein, and each such
party hereby irrevocably and unconditionally agrees to submit to the
jurisdiction of such courts for purposes of any such Actions. If such State
court also does not have jurisdiction over the subject matter thereof, then such
an action, suit or proceeding may be brought in the federal or state courts
located in the states of the principal place of business of any party hereto.
Each party irrevocably and unconditionally waives any objection it may have to
the venue of any Action brought in such courts or to the convenience of the
forum. Final judgment in any such Action shall be conclusive and may be enforced
in other jurisdictions by suit on the judgment, a certified or true copy of
which shall be conclusive evidence of the fact and the amount of any
indebtedness or liability of any party therein described.
14. In the event that any provision of this Agreement shall be held invalid
or unenforceable by any court of competent jurisdiction, such holding shall not
invalidate or render unenforceable any other provision hereof.
15. This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original, but both of which together shall
constitute one and the same instrument.
5
IN WITNESS WHEREOF, AVAX and the Recipient have caused this Agreement to be
executed by their respective authorized officers as of the date first set forth
above.
AVAX TECHNOLOGIES, INC.
By: /s/ Xxxxxxx X. Xxxxx, M.D.
Name: Xxxxxxx X. Xxxxx, M.D.
Title: President and Chief Executive Officer
HILL, THOMPSON, XXXXX & CO.
By: /s/ Xxxxxxx Xxxx
Name: Xxxxxxx Xxxx
Title: President
6
