EXHIBIT 10.46
PLACEMENT AGENT AGREEMENT
THIS PLACEMENT AGENT AGREEMENT ("AGREEMENT"), is made as of the 18th day of
August, 1999, by and between THE TRACKER CORPORATION OF AMERICA, INC., a
Delaware corporation (the "COMPANY"), and SOVEREIGN CAPITAL ADVISORS, LLC, a
Nevada limited liability company (the "AGENT").
BACKGROUND
The Company proposes to issue and sell Series 1 Secured Bridge Notes (the
"SECURITIES") resulting in gross proceeds to the Company of up to $3,000,000
(the "OFFERING") in a transaction not involving a public offering and without
registration under the Securities Act of 1933, as amended (the "ACT"), pursuant
to exemptions from the registration requirements of the Act under Section 4(2)
of the Act and Regulation D promulgated under the Act ("REGULATION D"). Agent
has offered to assist the Company to structure the Offering and the Securities,
and introduce the Company to prospective investors on a "best efforts basis."
The Company desires to secure the services of Agent on the terms and conditions
hereinafter set forth.
AGREEMENT
For and in consideration of the mutual covenants herein, and other good and
valuable consideration, the receipt and legal sufficiency of which is hereby
acknowledged, the parties hereto agree:
SECTION 1. ENGAGEMENT OF AGENT.
SECTION 1.1 APPOINTMENT. The Company hereby appoints Agent as its exclusive
agent in connection with the proposed issuance and sale by the Company of
securities resulting in gross proceeds to the Company of up to $3,000,000.
Agent, on the basis of the representations and warranties herein contained, and
upon and subject to the terms and conditions herein set forth, accepts such
appointment. This appointment shall be irrevocable for the period commencing
July 19, 1999 and ending February 18, 2000, which period maybe extended by the
consent of the Company and Agent (the "OFFERING PERIOD").
SECTION 1.2 COMPENSATION. The Company shall pay Agent a finder's fee of ten
percent (10%) of the gross proceeds derived from the offer, sale, and issuance
of the Securities or any other securities issued by the Company issued by the
Company during the Offering Period (the "GROSS PROCEEDS") PLUS a non-accountable
expense allowance of three percent (3%) of the Gross Proceeds.
SECTION 1.3 REIMBURSEMENT OF EXPENSES. The Company agrees to pay the
out-of-pocket expenses of Agent including the fees and expenses of counsel to
Agent for the preparation of the Transaction Agreements in accordance with
Section 7.7 of the Purchase Agreement, and fees and expenses of Escrow Agent in
accordance with Section 13 of the Escrow Agreement. The Company agrees that the
amount of such fees and expenses shall be deducted by Escrow Agent from the
proceeds of the issuance and sale of the Securities.
SECTION 1.4 LIMITED ROLE OF AGENT. Agent has acted only as an advisor to
the Company, Agent has advised the Company on the structure of the Offering and
Securities, and has identified potential investors. The Company has offered the
Securities to the investors and has negotiated directly with the investors in
the Offering. Agent will use
Exhibit 10.46
best efforts to introduce the Company only to "accredited investors" as defined
in Regulation D. Wherever possible Agent will introduce the Company to
prospective investors who are not "U.S. Persons," as defined in Regulation S.
SECTION 1.5 RIGHT OF FIRST REFUSAL. The Company hereby grants Agent a right
of first refusal to act as placement agent for any future private financings of
the Company, whether of equity securities, convertible debt securities, or
securities or instruments convertible into or exchangeable for debt or equity
securities of the Company, mergers, acquisitions, or similar transactions. The
duration of Agent's right of first refusal under this Section 1.5 shall be for a
period of one (1) year following the final Closing of the Offering. In the event
that the Company wishes to undertake a transaction described in this Section
1.5, the Company shall send Agent a written notice of the proposed transaction
(whether the transaction is initiated by the Company or is offered to the
Company by a third party) in sufficient specificity to allow Agent to understand
the proposed transaction clearly. This notice must be delivered to Agent at
least twenty days prior to the proposed closing of the transaction. Agent shall
have ten days from receipt of that notice to determine whether or not it wishes
to exercise its right of first refusal with respect to that transaction. Agent
shall notify the Company in writing of its decision to exercise or waive its
right of first refusal with respect to the transaction described in the notice.
If Agent waives its right of first refusal with respect to a particular
transaction, the Company may proceed with that transaction, PROVIDED HOWEVER,
that if the terms of the transaction are changed in any material way from the
terms set forth in the notice to Agent, Agent's right of first refusal shall
commence again. Agent's waiver of its rights of first refusal with respect to
any specific transaction shall not act as a waiver of its rights with respect to
future transactions within the applicable time period.
SECTION 1.6 CONFIDENTIALITY. The Company agrees to maintain the
confidentiality of all prospective investors identified to the Company by Agent,
except as required by applicable law. For a period of two (2) years from the
Closing, the Company will not solicit or enter into any financing transaction
with such investors without the written consent of Agent AND payment to Agent of
compensation no less than the compensation to be paid to Agent hereunder for
raising a like amount.
SECTION 1.7 REMEDIES. In the event that Company breaches Section 1.5 hereof
or Section 1.6 hereof, Agent shall be entitled to receive compensation in
respect of the financing giving rise to the breach of this Agreement at the
rates set forth in Section 1.2 hereof. SECTION 2. CONDUCT OF THE OFFERING.
SECTION 2.1 OFFERING DOCUMENTS. The Company shall utilize a Series 1
Secured Bridge Note Purchase Agreement (the "PURCHASE AGREEMENT"), a Series 1
Secured Bridge Note in the form of EXHIBIT A to the Purchase Agreement (the
"BRIDGE NOTES"), a Repricing Warrant to be issued with each Bridge Note in the
form of EXHIBIT B to the Purchase Agreement (the "WARRANTS"), a Registration
Rights Agreement in the form of EXHIBIT C to the Purchase Agreement the
("REGISTRATION RIGHTS AGREEMENT"), an Escrow Agreement in the form of EXHIBIT D
to the Purchase Agreement (the "ESCROW AGREEMENT"), a form of opinion of Company
counsel in the form of EXHIBIT E to the Purchase Agreement (the "COMPANY
OPINION"), a Form of Irrevocable Transfer Agent Instructions in the form of
EXHIBIT _ to the Purchase Agreement (the "TRANSFER AGENT INSTRUCTIONS"), a
certificate of the Company's Secretary (the "SECRETARY CERTIFICATE") and a
certificate of the Company's chief executive officer ("COMPLIANCE CERTIFICATE")
(collectively, the Purchase Agreement and all Exhibits thereto, the Secretary
Certificate and the Compliance Certificate are herein after referred to as the
"TRANSACTION AGREEMENTS") in connection with the Offering. The Company and its
counsel have reviewed, commented upon, and approved the Transaction Agreements.
Exhibit 10.46
SECTION 2.2 PUBLIC INFORMATION. The Company within a reasonable amount of
time prior to any Closing, shall provide each prospective investor with a copy
of all information required by Rule 502(b)(2)(ii) of Regulation D promulgated
pursuant to the Securities Act (collectively, "SEC DOCUMENTS"). The SEC
Documents have been prepared in conformity with the requirements (to the extent
applicable) of the Securities and Exchange Act of 1934, as amended (the "ACT")
and the rules and regulations ("RULES AND REGULATIONS") of the Commission
promulgated thereunder. As used in this Agreement, the term "OFFERING DOCUMENTS"
means collectively the SEC Documents and the Transaction Agreements, and all
amendments, exhibits, and supplements thereto, together with any other documents
which are provided to Agent by, or approved for Agent's use by, the Company for
this Offering.
SECTION 2.3 ACCURACY OF OFFERING DOCUMENTS. The Offering Documents, at the
time of delivery to Purchasers, conformed in all material respects with the
requirements, to the extent applicable, of the Act and the applicable Rules and
Regulations, and did not include any untrue statement of a material fact, or
omit to state any material fact required to be stated therein, or necessary, to
make the statements therein, in light of the circumstances under which they were
made, not misleading. At each Closing, the Offering Documents will contain all
statements which are required to be stated therein in accordance with the Act
and the Rules and Regulations for the purposes of the proposed Offering, and all
statements of material fact contained in the Offering memorandum will be true
and correct, and the Offering Documents will not include any untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading; PROVIDED, HOWEVER, that the Company does
not make any representations or warranties as to the information contained in or
omitted from the Offering Documents in reliance upon written information
furnished on behalf of Agent specifically for use therein. Agent has no
responsibility for the contents, accuracy, or adequacy of the Offering
Documents, or for the compliance of the Offering Documents, with the
requirements of Rule 502(b)(2)(ii) of Regulation D promulgated pursuant to the
Securities Act.
SECTION 2.4 DUTY TO AMEND. If, at any time during the Offering, or such
longer period as the Offering Documents are required to be delivered under the
Act, any event occurs or any event known to the Company relating to or affecting
the Company shall occur as a result of which the Offering Documents as then
amended or supplemented would include an untrue statement of a material fact, or
omit to state any material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, or if it
is necessary at any time after the date hereof to amend or supplement the
Offering Documents to comply with the Act or the applicable Rules and
Regulations, the Company shall forthwith notify Agent thereof and shall prepare
such further amendment or supplement to the Offering Documents as may be
required and shall furnish and deliver to Agent and to others, whose names and
addresses are designated by Agent, all at the cost of the Company, a reasonable
number of copies of the amendment or supplement or of the amended or
supplemented Offering Documents which, as so amended or supplemented, will not
contain an untrue statement of a material fact or omit to state any material
fact necessary in order to make the Offering Documents not misleading in the
light of the circumstances when it is delivered to a purchaser or prospective
purchaser, and which will comply in all respects with the requirements (to the
extent applicable) of the Act and the applicable Rules and Regulations.
SECTION 2.5 ESCROW OF FUNDS. Pursuant to the Escrow Agreement, executed by
the Company, the person named as escrow agent in the Escrow Agreement (the
"ESCROW AGENT"), and the prospective investors who have executed signature pages
to the Purchase Agreement, the Registration Rights Agreement, and the Escrow
Agreement (the "PURCHASERS"), the purchase price for the Securities to be
purchased as reflected on the Purchaser Signature Page to the Purchase Agreement
shall be wired to the Escrow Agent to be held by the Escrow Agent as provided in
the Escrow Agreement.
Exhibit 10.46
SECTION 2.6 APPROVAL OF INVESTORS. Prior to each closing, the Company shall
have the right to approve each Purchaser. If the Company withholds approval of
any Purchaser, the purchase price wired to Escrow Agent by such Purchaser shall
be returned to such Purchaser along with the Purchaser Signature Pages of such
Purchaser to the Purchase Agreement, the Registration Rights Agreement, and the
Escrow Agreement. The right to withhold approval of any Purchaser shall be
deemed to have been waived if the Company authorizes the Escrow Agent to
disburse funds provided by any Purchaser at any closing.
SECTION 2.7 DELIVERY OF SECURITIES. Securities in such form that, subject
to applicable transfer restrictions as described in the Purchase Agreement, they
can be negotiated by the holders thereof (issued in such denominations and in
such names as the Purchasers of the Securities may request shall be delivered by
the Company to the counsel for Placement Agent, with copies made available to
Agent for checking at least one (1) full business day prior to the Closing Date,
it being understood that the directions from Agent to the Company shall be given
at least two (2) full business days prior to the Closing Date. The Securities
shall be delivered at the Initial Closing and at each Subsequent Closing.
SECTION 2.8 INITIAL CLOSING. The Initial Closing (the "INITIAL CLOSING")
shall occur at such time as (a) Purchasers have delivered to the Company (care
of Xxxxxxx Law Group LLC, counsel for Agent) executed Purchaser Signature Pages
to each of the Purchase Agreement, the Registration Rights Agreement, and the
Escrow Agreement, (b) the Company has not withheld approval the Purchasers, and
(c) all other conditions to the obligation of the Purchasers and the Company to
close the transactions contemplated by the Purchase Agreement have been
satisfied or waived.
SECTION 2.9 SUBSEQUENT CLOSINGS. In the event that the Initial Closing
shall be for an amount of Securities that is less than the amount of the
Offering, the Offering may be continued, and additional Closings may be held
(each a "SUBSEQUENT CLOSING") throughout the Offering Period, PROVIDED THAT (a)
Purchasers have delivered to the Company (care of Xxxxxxx Law Group LLC, counsel
for Agent) executed Purchaser Signature Pages to each of the Purchase Agreement,
the Registration Rights Agreement, and the Escrow Agreement, (b) the Company has
not withheld approval the Purchasers, and (c) all other conditions to the
obligation of the Purchasers and the Company to close the transactions
contemplated by the Purchase Agreement have been satisfied or waived.
SECTION 2.10 DISBURSEMENTS AT CLOSING. At each Closing, the Company shall
execute a Release Notice that authorizes the Escrow Agent to receive expenses of
the Offering in the amounts specified, and effect a wire transfer of the net
proceeds of such Closing to the Company or another entity designated therein by
the Company. The authorization of the Company to release the funds held by the
Escrow Agent is the Company's authorization to release the executed Transaction
Agreements and Securities to the Purchasers. One complete set of executed
Transaction Documents will be delivered to the Company.
SECTION 2.11 TIME AND PLACE OF CLOSINGS. The Initial Closing and any
Subsequent Closing shall be held at the offices of Xxxxxxx Law Group LLC, 0000
Xxxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000, at 10:00 a.m. on such dates as
are fixed in accordance with this Agreement and the Purchase Agreement. The
Closing Date may be changed by mutual agreement of Agent and the Company. The
Company agrees to rely on faxed signature pages from the Purchasers, without the
requirement of obtaining an originally signed version of any of the Transactions
Agreements to which a Purchaser is a Party.
Exhibit 10.46
SECTION 3. CONDITIONS OF AGENT'S OBLIGATIONS.
Agent's obligations hereunder shall be subject to the accuracy, as of the
Closing Date, of the representations and warranties on the part of the Company
contained in this Agreement, to the fulfillment of or compliance by the Company
with all covenants and conditions hereof, and to the following additional
conditions:
(a) There shall be no outstanding objection to any Transaction
Agreement by the Company or its counsel or any Purchaser or its counsel.
(b) The Company shall not have disclosed that the Offering Documents,
or any amendment thereof or supplement thereto, contains an untrue
statement of fact, which, in the opinion of counsel to Agent, is material,
or omits to state a fact, which, in the opinion of such counsel, is
material and is required to be stated therein, or is necessary to make the
statements therein, under the circumstances in which they were made, not
misleading.
(c) Between the date hereof and the Closing Date, the Company shall
not have sustained any loss on account of fire, explosion, flood, accident,
calamity, or any other cause of such character as would materially
adversely affect its business or property considered as an entire entity,
whether or not such loss is covered by insurance.
(d) There shall be no litigation instituted or overtly threatened
against the Company, and there shall be no proceeding instituted or
threatened against the Company before or by any federal or state
commission, regulatory body, or administrative agency, or other
governmental body, domestic or foreign, wherein an unfavorable ruling,
decision, or finding would materially adversely affect the business,
franchises, license, permits, operations, or financial condition or income
of the Company considered as an entity.
(e) Except as contemplated herein or as set forth in the Offering
Documents, during the period subsequent to the most recent financial
statements contained in the Offering Documents, if any, and prior to the
Closing Date, the Company
(i) shall have conducted its business in the usual and ordinary manner
as the same is being conducted as of the date hereof and (ii) except in the
ordinary course of business, the Company shall not have incurred any
liabilities or obligations (direct or contingent) or disposed of any
assets, or entered into any material transaction, or suffered or
experienced any substantially adverse change in its condition, financial or
otherwise. At the Closing Date, the equity account of the Company shall be
substantially the same as reflected in the most recent balance sheet
contained in the Offering Documents without considering the proceeds from
the sale of the Securities other than as may be set forth in the Offering
Documents.
(f) The authorization of the Securities by the Company and all
proceedings and other legal matters incident thereto and to this Agreement
shall be reasonably satisfactory in all respects to Agent and its counsel.
(g) The Company shall have furnished Agent a copy of the Company
opinion with respect to the sufficiency of all corporate proceedings and
other legal matters relating to this Agreement as Agent may reasonably
require.
Exhibit 10.46
(h) The Company shall have furnished to Agent the opinion, dated the
Initial Closing, addressed to Agent, from counsel to the Company, as
required by the Purchase Agreement.
(h) The Company shall have furnished to Agent a copy of the Compliance
Certificate and the Secretary Certificate each dated as of the Closing
Date.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
For the purpose of inducing Agent to enter into this and perform this
Agreement, the Company hereby represents and warrants to and agrees with Agent
as follows:
SECTION 4.1 CORPORATION CONDITION. The Company's condition is as described
in its Offering Documents, except for changes in the ordinary course of business
and normal year-end adjustments that are not in the aggregate materially adverse
to the Company. The Offering Documents, taken as a whole, present fairly the
business and financial position of the Company as of the Closing Date.
SECTION 4.2 NO MATERIAL ADVERSE CHANGE. Except as may be reflected in or
contemplated by the Offering Documents, subsequent to the dates as of which
information is given in the Offering Documents, and prior to the Closing Date,
there shall not have been any material adverse change in the condition,
financial or otherwise, or in the results of operations of the Company or in its
business taken as a whole.
SECTION 4.3 NO DEFAULTS. Except as disclosed in the Offering Documents or
in writing to Agent, the Company is not in default in any material respect in
the performance of any material obligation, agreement, or condition contained in
any debenture, note, or other evidence of indebtedness or any indenture or loan
agreement of the Company. The execution and delivery of this Agreement, and the
consummation of the transactions herein contemplated, and compliance with the
terms of this Agreement, will not conflict with, or result in, a breach of any
of the terms, conditions, or provisions of, or constitute a default under, the
Certificate of Incorporation or bylaws of the Company (in any respect that is
material to the Company), any material note, indenture, mortgage, deed of trust,
or other agreement or instrument to which the Company is a party or by which the
Company or any property of the Company is bound, or to the Company's knowledge,
any existing law, order, rule, regulation, writ, injunction, or decree of any
government, governmental instrumentality, agency, or body, arbitration tribunal
or court, domestic or foreign, having jurisdiction over the Company or any
property of the Company. The consent, approval, authorization, or order of any
court or governmental instrumentality, agency or body is not required for the
consummation of the transactions herein contemplated except such as may be
required under the Act or under the blue sky or securities laws of any state or
jurisdiction.
SECTION 4.4 INCORPORATION AND STANDING. The Company is, and at the Closing
Date will be, duly formed and validly existing in good standing as a corporation
under the laws of the State of Delaware and with full power and authority
(corporate and other) to own its properties and conduct its business, present
and proposed, as described in the Offering Documents; the Company, has full
power and authority to enter into this Agreement; and the Company is duly
qualified and in good standing as a foreign entity in each jurisdiction in which
the failure to so qualify would have a material adverse effect on the Company or
its properties.
SECTION 4.5 LEGALITY OF SECURITIES. Prior to the Closing Date, the
Securities will have been duly and validly authorized and issued, will be valid,
Exhibit 10.46
binding and enforceable against the Company in accordance with their terms, and
will conform in all material respects to the statements with regard thereto
contained in the Offering Documents.
SECTION 4.6 LEGALITY OF CONVERSION SHARES. The Common Stock into which the
Securities are convertible, when converted in accordance with the Securities
will be duly and validly issued and outstanding, fully paid, and non-assessable
and conform in all material respects to the statements with regard thereto
contained in the Offering Documents.
SECTION 4.7 LITIGATION. Except as set forth in the Offering Documents,
there is now, and at the Closing Date there will be, no action, suit, or
proceeding before any court or governmental agency, authority or body pending
or, to the knowledge of the Company, threatened, which might result in judgments
against the Company not adequately covered by insurance or which collectively
might result in any material adverse change in the condition (financial or
otherwise) or business of the Company or which would materially adversely affect
the properties or assets of the Company.
SECTION 4.8 FINDERS. The Company does not know of any outstanding claims
for services in the nature of a finder's fee or origination fees with respect to
the sale of the Securities hereunder for which Agent may be responsible, and the
Company will indemnify Agent from any liability for such fees by any party who
has a claim for such compensation from the Company and for which person Agent is
not legally responsible.
SECTION 4.9 TAX RETURNS. The Company has filed all federal and state tax
returns which are required to be filed, and has paid all taxes shown on such
returns and on all assessments received by it to the extent such taxes have
become due. All taxes with respect to which the Company is obligated have been
paid or adequate accruals have been set up to cover any such unpaid taxes.
SECTION 4.10 AUTHORITY. The execution and delivery by the Company of this
Agreement have been duly authorized by all necessary action, and this Agreement
is the valid, binding, and legally enforceable obligation of the Company subject
to standard qualifications as to the availability of equitable remedies, the
effect of bankruptcy and other laws relating to the protection of debtors and
public policy opinions promulgated by the Commission with respect to
indemnification against liabilities under the Act.
SECTION 4.11 ACTIONS BY THE COMPANY. The Company will not take any action
which will impair the effectiveness of the transactions contemplated by this
Agreement.
SECTION 5. COVENANTS OF THE COMPANY.
The Company covenants and agrees with Agent that:
SECTION 5.1 RESTRICTIONS ON AMENDMENTS. After the date hereof, the Company
will not at any time, prepare and distribute any amendment or supplement to the
Offering Documents, of which amendment or supplement Agent shall not previously
have been advised and Agent and its counsel furnished with a copy within a
reasonable time period prior to the proposed adoption thereof, or to which Agent
shall have reasonable objected in writing on the ground that it is not in
compliance with the Act or the Rules and Regulations (if applicable).
SECTION 5.2 EXPENSES OF OFFERING. The Company will pay, whether or not the
transactions contemplated by the Transaction Agreements are consummated, all
costs and expenses incident to the Transaction Agreements, including all
expenses incident to the authorization of the Securities, their issue and
Exhibit 10.46
delivery to the Escrow Agent, any original issue taxes in connection therewith,
all transfer taxes, if any, incident to the initial sale of the Securities, the
fees and expenses of Agent's and the Company's counsel (except as provided
below) and accountants, and the cost of reproduction and furnishing to Agent
copies of the Offering Documents as herein provided, PROVIDED HOWEVER, that the
Company shall not be responsible for the payment of fees and expenses incurred
by Agent's counsel, if Agent is unable to procure Purchaser Signature Pages to
the Transaction Agreements from a Purchaser that the Company was willing to
accept.
SECTION 5.3 AVAILABILITY OF INFORMATION. Prior to the Closing Date, the
Company will cooperate with Agent in such investigation as it may make or cause
to be made of all of the properties, business, and operations of the Company in
connection with the Offering of the Securities. The Company will make available
to it in connection therewith such information in its possession as Agent may
reasonably request and will make available to Agent such persons as Agent shall
deem reasonably necessary and appropriate in order to verify or substantiate any
such information so supplied.
SECTION 5.4 REPORTS AND FILINGS. The Company shall be responsible for
making any and all filings required by the blue sky authorities and filings
required by the laws of the jurisdictions in which the subscribers who are
accepted for purchase of Securities are located, if any. Agent shall assist
Company in this respect, but such filings shall be the responsibility of
Company.
SECTION 5.5 NO UNDISCLOSED EVENTS, LIABILITIES, DEVELOPMENTS, OR
CIRCUMSTANCES. The Company's condition is as described in its Offering
Documents, except for changes in the ordinary course of business and normal
year-end adjustments that are not individually or in the aggregate materially
adverse to the Company. The Offering Documents, taken as a whole, will present
fairly the business and financial position of the Company as of each Closing
Date.
SECTION 5.6 NO MATERIAL ADVERSE CHANGE. Except as may be reflected in or
contemplated by the Offering Documents, subsequent to the dates as of which
information is given in the Offering Documents, and prior to each Closing Date,
there shall not have been any material adverse change in the condition,
financial, or otherwise, or in the results of operations of the Company or in
its business taken as a whole.
SECTION 6. INDEMNIFICATION.
SECTION 6.1 INDEMNIFICATION OF AGENT. The Company agrees to indemnify and
hold harmless Agent, each person who controls Agent within the meaning of
Section 15 of the Act and Agent's employees, accountants, attorneys and agents
(the "AGENT'S INDEMNITEES") against any and all losses, claims, damages, or
liabilities, joint or several, to which they or any of them may become subject
under the Act or any other statute or at common law for any legal or other
expenses (including the costs of any investigation and preparation) incurred by
them in connection with any litigation, whether or not resulting in any
liability, but only insofar as such losses, claims, damages, liabilities, and
litigation arise out of or are based upon any untrue statement of material fact
contained in the Offering Documents or any amendment or supplement thereto or
any application or other document filed in any state or jurisdiction in order to
qualify the Securities under the Blue Sky or securities laws thereof, or the
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, under the circumstances under which
they were made, not misleading, all as of the date of the Offering Documents or
of such amendment as the case may be; PROVIDED HOWEVER, that the indemnity
agreement contained in this Section 6.1 shall not apply to amount paid in
settlement of any such litigation, if such settlements are made without the
consent of the Company, nor shall it apply to Agent's Indemnitees in respect to
any such losses, claims, damages, or liabilities arising out of or based upon
Exhibit 10.46
any such untrue statement or alleged untrue statement or any such omission or
alleged omission, if such statement or omission was made in reliance upon
information furnished in writing to the Company by Agent specifically for use in
connection with the preparation of the Offering Documents or any such amendment
or supplement thereto or any application or other document filed in any state or
jurisdiction in order to qualify the Securities under the Blue Sky or securities
law thereof. This indemnity agreement is in addition to any other liability
which the Company may otherwise have to Agent's Indemnitees. Agent's Indemnitees
agree, within ten (10) days after the receipt by them of written notice of the
commencement of any action against them in respect to which indemnity may be
sought from the Company under this Section 6.1, to notify the Company in writing
of the commencement of such action; PROVIDED HOWEVER, that the failure of
Agent's Indemnitees to notify the Company of any such action shall not relieve
the Company from any liability which it may have to Agent's Indemnitees on
account of the indemnity agreement contained in this Section 6.1, and further
shall not relieve the Company from any other liability which it may have to
Agent's Indemnitees, and if Agent's Indemnitees shall notify the Company of the
commencement thereof, the Company shall be entitled to participate in (and, to
the extent that the Company shall wish, to direct) the defense thereof at its
own expense, but such defense shall be conducted by counsel of recognized
standing and reasonably satisfactory to Agent's Indemnitees, defendant or
defendants, in such litigation. The Company agrees to notify Agent's Indemnitees
promptly of the commencement of any litigation or proceedings against the
Company or any of the Company's officers or directors of which the Company may
be advised in connection with the issue and sale of any of the Securities and to
furnish to Agent's Indemnitees, at their request, to provide copies of all
pleadings therein and to permit the Company's Indemnitees to be observers
therein and apprise Agent's Indemnitees of all developments therein, all at the
Company's expense.
SECTION 6.2 INDEMNIFICATION OF COMPANY. Agent agrees, in the same manner
and to the same extent as set forth in Section 6.1 above, to indemnify and hold
harmless the Company, and the Company's and Company's employees, accountants,
attorneys, and agents (the "COMPANY'S INDEMNITEES") with respect to (a) any
statement in or omission from the Offering Documents or any amendment or
supplement thereto or any application or other document filed in any state or
jurisdiction in order to qualify the Securities under the Blue Sky or securities
laws thereof, or any information furnished pursuant to Section 2.2 hereof, if
such statement or omission was made in reliance upon information furnished in
writing to the Company by Agent on its behalf specifically for use in connection
with the preparation thereof or supplement thereto, or (b) any untrue statement
of a material fact made by Agent or its agents not based on statements in the
Offering Documents or authorized in writing by the Company, or with respect to
any misleading statement made by Agent or its agents resulting from the omission
of material facts which misleading statement is not based upon the Offering
Documents, or information furnished in writing by the Company or, (c) any breach
of any representation, warranty, or covenant made by Agent in this Agreement.
Agent's liability hereunder shall be limited to the amount received by it for
acting as Agent in connection with the Offerings. Agent shall not be liable for
amounts paid in settlement of any such litigation if such settlement was
effected without its consent. In case of the commencement of any action in
respect of which indemnity may be sought from Agent, the Company's Indemnitees
shall have the same obligation to give notice as set forth in Section 6.1 above,
subject to the same loss of indemnity in the event such notice is not given, and
Agent shall have the same right to participate in (and, to the extent that it
shall wish, to direct) the defense of such action at its own expense, but such
defense shall be conducted by counsel of recognized standing reasonably
satisfactory to the Company. Agent agrees to notify the Company's Indemnitees
and, at their request, to provide copies of all pleadings therein and to permit
the Company's Indemnitees to be observers therein and apprise them of all the
developments therein, all at Agent's expense.
Exhibit 10.46
SECTION 7. TERMINATION.
SECTION 7.1 TERMINATION BY AGENT. This Agreement may be terminated at any
time during the Offering Period by Agent by written notice to the Company, if
the Company shall have failed or been unable to comply with any of the terms,
conditions, or provisions of the Transaction Agreements to be performed,
complied with, or fulfilled by the Company within the respective times, if any,
herein provided for, unless compliance therewith or performance or satisfaction
thereof shall have been expressly waived by Agent in writing.
SECTION 7.2 TERMINATION BY COMPANY. This Agreement may be terminated by the
Company at the conclusion of the Offering Period by notice to Agent if Agent
shall have failed or been unable to comply with any of the terms, conditions, or
provisions of this Agreement to be performed, complied with, or fulfilled by
Agent within the respective times, if any, herein provided for, unless
compliance therewith or performance or satisfaction thereof shall have been
expressly waived by the Company in writing.
SECTION 7.3 TERMINATION FOR FORCE MAJEURE EVENTS. This Agreement may be
terminated by Agent by notice to the Company at any time, if, in the reasonable,
good faith judgment of Agent, payment for and delivery of the Securities is
rendered impracticable or inadvisable because: (a) additional material
governmental restrictions not in force and effect on the date hereof shall have
been imposed upon trading in securities generally; (b) a war or other national
calamity shall have occurred; or (c) the condition of the market (either
generally or with reference to the sale of the Securities to be offered hereby)
or the condition of any matter affecting the Company or any other circumstance
is such that it would be undesirable, impracticable or inadvisable, in the
judgment of Agent, to proceed with this Agreement or with the Offering.
SECTION 7.4 TERMINATION WITHOUT LIABILITY. Any termination of this
Agreement pursuant to this Section 7 shall be without liability of any character
(including, but not limited to, loss of anticipated profits or consequential
damages) on the part of any party thereto, except that the Company shall remain
obligated to pay the costs and expenses provided to be paid by it specified in
Sections 1.3 and 5.2, and the Company and Agent shall be obligated to pay,
respectively, all losses, claims, damages, or liabilities, joint or several,
under Section 6.1 in the case of the Company and Section 6.2 in the case of
Agent.
SECTION 8. MISCELLANEOUS.
SECTION 8.1 NOTICES. Whenever notice is required by the provisions of this
Agreement to be given, such notice shall be in writing, addressed:
If to Company:
The Tracker Corporation of America, Inc.
000 Xxxxxx Xxxxxx Xxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx
Xxxxxx X0X 0X0
Attn: Xxx X. Xxxxxxxx, President
Telephone: (000) 000-0000
Facsimile: (416) ___-____
Exhibit 10.46
with a copy (which shall not constitute notice) to:
Xxxxx Xxxxxxx LLP
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Xxxxxx Xxxxx, Esq.
Tel: 000-000-0000
Fax: 000-000-0000
If to Agent:
Sovereign Capital Advisors, LLC
0000 Xxxxxxxxx Xxxx, X.X.
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxx Xxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
With a copy (which shall not constitute notice) to:
Xxxxxxx Law Group LLC
0000 Xxxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx XX, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
8.2 BENEFIT. This Agreement is made solely for the benefit of Agent and the
Company, their respective officers and directors and any controlling person
referred to in Section 15 of the Act and their respective successors and
assigns, and no other person may acquire or have any right under or by virtue of
this Agreement, including, without limitation, the holders of any Securities.
The term "SUCCESSOR" or the term "SUCCESSORS AND ASSIGNS" as used in this
Agreement shall not include any purchasers, as such, of any of the Securities.
8.3 SURVIVAL. The respective indemnities, agreements, representations,
warranties, covenants and other statements of the Company and Agent, or the
officers, directors or controlling persons of the Company and Agent as set forth
in or made pursuant to this Agreement and the indemnity agreements of the
Company and Agent contained in Section 6 hereof shall survive and remain in full
force and effect, regardless of (a) any investigation made by or on behalf of
the Company or Agent or any such officer, director or controlling person of the
Company or of Agent; (b) delivery of or payment for the Securities; or (c) the
Closing Date, and any successor of the Company or Agent or any controlling
person, officer or director thereof, as the case may be, shall be entitled to
the benefits hereof.
8.4 GOVERNING LAW. The validity, interpretation, and construction of this
Agreement will be governed by the laws of the State of Georgia. Any dispute or
controversy between the parties arising in connection with this Agreement or the
subject matter contemplated by this Agreement shall be resolved by arbitration
before a three-member panel of the American Arbitration Association in
accordance with the commercial arbitration rules of said forum and the Federal
Arbitration Act, 9 U.S.C. 1 et seq., with the resulting award being final and
conclusive. Said
Exhibit 10.46
arbitrators shall be empowered to award all forms of relief and damaged claimed,
including, but not limited to, attorney's fees, expenses of litigation and
arbitration, exemplary damages, and prejudgment interest. The parties further
agree that any arbitration action between them shall be heard in Atlanta,
Georgia, and expressly consent to the jurisdiction and venue of the Superior
Court of Xxxxxx County, Georgia, and the United States District Court for the
Northern District of Georgia, Atlanta Division for the adjudication of any civil
action asserted pursuant to this Paragraph.
8.5 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which may be deemed an original and all of which together
will constitute one and the same instrument.
8.6 CONFIDENTIAL INFORMATION. All confidential financial or business
information (except publicly available or freely usable material otherwise
obtained from another source) respecting either party will be used solely by the
other party in connection with the within transactions, be revealed only to
employees or contractors of such other party who are necessary to the conduct of
such transactions, and be otherwise held in strict confidence.
8.7 PUBLIC ANNOUNCEMENTS. Prior to the Closing Date, neither party hereto
will issue any public announcement concerning the within transactions without
the approval of the other party.
8.8 FINDERS. The parties acknowledge that no person has acted as a finder
in connection with the transactions contemplated herein and each will agree to
indemnify the other with respect to any other claim for a finder's fee in
connection with the Offering.
8.9 RECITALS. The recitals to this Agreement are a material part hereof,
and each recital is incorporated into this Agreement by reference and made apart
of this Agreement.
IN WITNESS WHEREOF, the parties hereto have duly caused this Agreement to
be executed as of the day and year first above written.
[Signatures begin on the following page]
Exhibit 10.46
COMPANY SIGNATURE PAGE
TO
PLACEMENT AGENT AGREEMENT
THE COMPANY:
THE TRACKER CORPORATION OF AMERICA, INC.
By: /s/ Xxx X. Xxxxxxxx
-----------------------------------------
Xxx X. Xxxxxxxx, President
Exhibit 10.46
AGENT SIGNATURE PAGE
TO
PLACEMENT AGENT AGREEMENT
THE AGENT
SOVEREIN CAPITAL ADVISORS, LLC
By:
-----------------------------------------
Xxx Xxxx
By: /s/ Xxx X. Xxxxxxxx
-----------------------------------------
Xxx X. Xxxxxxxx, President
