PLACEMENT AGENT AGREEMENT
THIS PLACEMENT AGENT AGREEMENT (the "Agreement") is made and entered to be
effective this 16th day of July, 2001 by and between OneCap, a Nevada
corporation (the "Company") and NevWest Securities Corporation, a Nevada
corporation (the "Placement Agent"), with reference to the following facts:
RECITALS
A. WHEREAS the Company desires to issue and sell up to 25,000 Units (the
"Units") at a price of $1,000 per Unit, each Unit consisting of One
Convertible Debenture (a) with a face value of $1,000, (b) bearing interest
to holder pursuant to terms and conditions to be determined, (c)
convertible into Common Stock of the Company at a conversion rate to be
determined, and (d) subject to all additional terms and conditions as shall
be specified in a Confidential Private Placement Memorandum (the
"Memorandum") prepared pursuant to this Agreement;
B. WHEREAS the Company desires to issue and sell a minimum of 1,000 Units
in the total minimum aggregate amount of $1,000,000 (the "Minimum
Offering") and a maximum of 25,000 Units in the total maximum aggregate
amount of $25,000,000 (the "Maximum Offering");
C. WHEREAS the Company desires to conduct the offering of Units pursuant to
Regulation D, Rule 506 of the Securities Act of 1933, as amended, and other
applicable rules and regulations (collectively, the "Regulations");
D. WHEREAS the Company desires that the Placement Agent offer and sell
strictly on a "best efforts" basis to a limited number of qualified
purchasers (the "Investors"), as exclusive agent of the Company, the Units
described in the Memorandum;
AGREEMENT
NOW, THEREFORE, upon the terms, covenants, and conditions set forth
below and for good and valuable
consideration, the parties agree as follows:
1. Incorporation of Recitals. Recitals A through D above are incorporated
into this Agreement by this reference as though fully set forth in this
paragraph 1.
2. Certain Definitions. For the purposes of this Agreement, the
following terms have the meanings set forth below:
2.1. Commission. "Commission" means the United States Securities and
Exchange Commission and includes any governmental body or agency
succeeding to the functions thereof.
2.2. Company. "Company," to the extent the context permits, includes any
subsidiary.
2.3. Exchange Act. "Exchange Act" means the Securities Exchange Act of
1934, as amended, or any similar federal law then in force.
2.4. Officer's Certification. "Officer's Certification" means a writing
signed by the Company's chief executive officer and its chief
financial officer, and its secretary or assistant secretary, stating
that (i) the Persons signing the writing have made or have caused to
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be made the investigations necessary in order to permit them to verify
the accuracy of the information set forth in such writing, and (ii) to
the best of their knowledge, the writing does not misstate any
material fact and does not omit to state any fact necessary to make
the writing not misleading.
2.5. Proprietary Rights. "Proprietary Rights" means patents, registered or
common law trademarks, service marks, trade names, registered or
common law copyrights, licenses, and other similar rights (including,
without limitation, know how, trade secrets, and other confidential
information) and applications for each of the foregoing.
2.6. Securities Act. "Securities Act" means the Securities Act of 1933,
as amended, or any similar federal law then in force.
2.7. Subsidiary. "Subsidiary" means any corporation or other entity of
which units of stock or other Units of ownership possessing a majority
of the ordinary voting power in electing the board of directors, or
exercising corresponding control in the case of a non-corporate
entity, is, at the time as of which any determination is being made,
owned by the Company either directly or indirectly through one or more
Subsidiaries.
3. Agreement to Sell Units and Engage Placement Agent
3.1. Appointment of Placement Agent. On the terms and subject to all the
conditions of this Agreement the Company agrees to sell, and to engage
the Placement Agent on an exclusive basis for 180 days from the date
hereof to sell the Units to be offered pursuant to the Memorandum and
the exhibits thereto, and the Placement Agent agrees to sell on behalf
of the Company and pursuant to the Memorandum and the exhibits thereto
and this Agreement, up to 25,000 Units for a maximum aggregate
offering amount of $25,000,000, with the minimum amount and escrow of
funds of $1,000,000 required, on a "best efforts" basis. The Placement
Agent shall act exclusively as agent in the sale of the Units.
3.2. Responsibility of Company. The Company recognizes that compliance
with applicable federal and state law (except as to active
misrepresentations by the Placement Agent or the default by the
Placement Agent in the performance of its obligations described
herein, including its obligations concerning compliance with the
requirements of applicable federal and state securities laws
pertaining to the offer and sale of the Units) is in all respects the
responsibility of the Company, and the Company agrees to take such
precautions as may be necessary to ensure compliance therewith.
Without in any way limiting the generality of the foregoing, the
parties contemplate that the offer and sale of Units will be made so
as to comply with the exemptions from the registration requirements of
section 5 of the Securities Act of 1933, as amended (the "Securities
Act"), afforded by sections 3(b), 4(2), and/or 4(6) of the Securities
Act, and the exemptions from qualification afforded by the rules and
regulations promulgated pursuant to the above sections, including
Regulation D promulgated pursuant to the Securities Act. The Units may
be offered and sold in Nevada and other states pursuant to limited
offering or other exemptions or other qualification in such states as
may be mutually agreeable to the Company and the Placement Agent.
3.3. Offering Memorandum. The Company shall at its own expense prepare
and amend, if necessary, the Memorandum and such other disclosure and
offering documents as are required to comply with the requirements of
the applicable federal and state securities laws for the offering
contemplated by this Agreement and to copy and deliver to the
Placement Agent at the Company's expense the number of copies
reasonably requested by the Placement Agent for use in connection with
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the Offering. The representations made by the Memorandum are
exclusively the representations of the Company as relied upon by the
Placement Agent. The Company shall take prudent steps necessary to
assess the legal and/or regulatory sufficiency of the Memorandum or
like documentation via its own in-house counsel or via the retention
of outside counsel engaged specifically to review such material and
the relevant issues thereunto pertaining. In any event, the Company
warrants that in authorizing the use of any documentation used in
conjunction with the activities anticipated to be conducted herein, it
shall cause to be undertaken sufficient review of such activity by
competent counsel and/or advisors and no provision contained herein
shall result in any duty incumbent upon the Placement Agent to
ascertain the legal and/or regulatory sufficiency of such
documentation.
3.4. Full and Fair Disclosure. It is expressly understood and expected
by both parties and expressly warranted by the Company that the
Memorandum and any other documentation provided by the Company to the
Placement Agent in connection with the offering of the Units pursuant
to this Agreement shall be reviewed by the Company or its appointees
of sufficient competence for any material deficiencies in such a
manner as to ensure accuracy and full and fair disclosure. The Company
warrants that it shall take prudent steps necessary to ensure that
such documentation contain no material misrepresentations or omissions
and hereby acknowledges that the Placement Agent is not responsible
for ensuring the accuracy or sufficiency of any documentation or
disclosures therein.
3.5. "Blue Sky." The Placement Agent, prior to making any offers in any
state, shall promptly advise the Company in writing of the
requirements of the state securities laws of each such state for
making such offers and sales without registration or qualification of
the securities offered in that state. The Company shall evaluate said
requirements and advise the Placement Agent whether the Company
desires to proceed with the offering in each particular state. Upon
approval by the Company, the Placement Agent shall file all documents
and notices and pay such fees, recoverable from the Company, as are
required to make offers and sales in each state chosen by the Company
pursuant to this Offering. Nothing herein shall require the Company to
pay costs of the Placement Agent's registering as a broker/dealer in
any state.
3.6. Procedures. The offer and sale of the Units and the procedure for
subscribing thereto shall conform to the description thereof as set
forth in the Memorandum.
3.7. Noncircumvention. The Company agrees not to sell, contract to sell,
offer to sell, solicit offers for the purchase, or otherwise dispose
of or offer to dispose of or enter into any agreement to dispose of
any Units to any individual, entity, institution, venture capitalist,
etc., introduced to the Company by the Placement Agent, without
disclosing such an intent and without securing written authorization
from the Placement Agent of such a sale or offer prior to occurrence,
throughout the offering period. In any event, the Company is obliged
to compensate the Placement Agent as stipulated in this Agreement.
4. Best Efforts Basis. The Company hereby expressly acknowledges that the
Placement Agent is under no obligation to purchase any number of Units
in a manner which may be construed as a firm underwriting or
commitment and that the sum and substance of this relationship is
strictly characterized by the term(s) "agent," "finder," and "best
efforts" as these terms are generally defined by applicable rules and
regulations as promulgated by the Securities Exchange Commission and
NASD. There is no obligation on the part of the Placement Agent to
purchase or raise the minimum proceeds indicated.
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5. Escrow Provisions. The Placement Agent shall cause to be created an
Escrow Account with a bank acting as the Escrow Agent. Delivery and
payment of any proceeds from any Investors shall be made to such
Escrow Account. The Company shall compensate the Placement Agent
concurrent to the satisfaction of any contingency and the subsequent
release of any funds from escrow as established in the Memorandum. The
cost of initiating such Escrow Account shall be borne by the Company,
which cost is estimated to be $1,500.00.
5.1. Escrow Agent. The Escrow Agent shall be a bank as defined by Section
3(a)(6) of the Securities Exchange Act of 1934, as amended.
5.2. Escrow Agreement. The Company, the Placement Agent, and the Escrow
Agent shall enter into an Escrow Agreement in accordance with
applicable rules and regulations, particularly SEC Rule 15(c)2-4.
5.3. Escrow Account. Pursuant to the Escrow Agreement, NevWest/OneCap
Escrow Account (the "Escrow Account") shall be a non-interest bearing
account held with the Escrow Agent.
5.4. Delivery of Escrow Funds.
5.4.1 The Subscribers shall deliver to The Placement Agent checks or
wire transfers made payable to the order of NevWest/OneCap Escrow
Account together with the Subscribers' mailing addresses. All
funds received by The Placement Agent shall (i) be transmitted
directly into the Escrow Account by noon of the next business day
after receipt thereof, and (ii) become available to the issuer
immediately upon satisfaction of the contingency stipulated to be
the attainment of the Minimum Offering. The collected funds
deposited into the Escrow Account are referred to herein as the
"Escrow Funds."
5.4.2 The Placement Agent shall have no duty or responsibility to
enforce the collection or demand payment of any funds deposited
into the Escrow Account. If, for any reason, any check deposited
into the Escrow Account shall be returned unpaid to The Placement
Agent, the sole duty of The Placement Agent shall be to notify
the Company and promptly return the check to the Subscriber.
5.5. Investment of the Escrow Funds. The Escrow Account shall not bear
interest and no investments, other than those that comply with SEC
Rule 15(c)2-4, shall be made while the Escrow Funds are held in
escrow.
5.6. Release of Escrow Funds. The Escrow Funds shall be disbursed from the
Escrow Account in accordance with the following:
5.6.1 Provided that the Escrow Funds total at least $1,000,000 at or
before 5:00 p.m., Pacific Standard Time (PST), on the Closing
Date defined as the date 180 days from the date of commencement
of the Offering, or on any date prior thereto, the Placement
Agent shall instruct the Escrow Agent to release the Escrow Funds
(or any portion thereof) promptly to the Company, and thereafter
the Escrow Account shall remain open for the purpose of
depositing therein the subscription price for additional Units
sold in the Offering, which additional Escrow Funds shall be
available to the Company immediately or as otherwise instructed
by the Company.
5.6.2 If, by 5:00 p.m., PST, on the Closing Date, the Escrow Funds do
not total at least $1,000,000, then the Escrow Funds shall be
returned promptly to Subscribers by the Escrow Agent.
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5.6.3 In the event that at any time the Placement Agent shall receive
from the Company written instructions signed by an individual who
is identified as an officer or director of the Company,
requesting to refund to a Subscriber the amount of a collected
check or other funds received in escrow, the Placement Agent
shall instruct the Escrow Agent for such refund to be made
promptly to the Subscriber.
5.7. Limitation of Responsibility and Liability of the Placement Agent.
The Placement Agent
5.7.1 shall not be liable for any error of judgment or for any act
done or step taken or omitted by it in good faith, or for any
mistake of fact or law, or for anything which it may do or
refrain from doing in connection herewith, except its own
negligence and willful misconduct;
5.7.2 shall be authorized to rely upon all written instructions and/or
communications of the Company which appear to be valid on their
face;
5.7.3 shall have no implied obligations or responsibilities hereunder,
nor shall it have any obligation or responsibility to collect
funds or seek the deposit of money or property;
5.7.4 may consult with legal counsel of its choice with regard to any
legal question arising in connection with its duties or
responsibilities hereunder, and shall have no liability or
responsibility by reason of any action it may take or fail to
take in accordance with the opinions of such counsel;
5.7.5 acts hereunder as a trustee only, and is not responsible or
liable in any manner whatsoever for the sufficiency, correctness,
genuineness, or validity of any instrument deposited with it, or
with respect to the form or execution of the same, or the
identity, authority, or rights of any person executing or
depositing the same; and
5.7.6 shall be entitled to comply with any final order, judgment or
decree of a court of competent jurisdiction, and/or with the
consistent written instructions from the non-bank Party.
5.8. Costs and Expenses. Any costs or expenses associated with establishing
and/or maintaining the Escrow Account shall be payable by the
Placement Agent.
5.9. Termination of Escrow Agreement. The Escrow Agent's responsibilities
shall terminate at such time as the Escrow Funds shall have been fully
disbursed pursuant to the terms hereof and the Offering as
contemplated has formally closed or at such other time as explicitly
provided in the Escrow Agreement.
6. Covenants of the Company.
6.1. Offering Documentation. The Company covenants and agrees to provide the
Placement Agent with any and all documentation and/or information
requisite to due diligence relating to the Units as soon as
practicable after the execution and delivery of this Agreement or as
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requested by the Placement Agent from time to time, provided that the
Placement Agent agrees to keep this documentation completely
confidential, release only that information as agreed upon between the
Placement Agent and the Company.
6.2. Qualification of the Units for Offer and Sale. The Company covenants
and agrees, prior to, during, and after the offering of the
Securities, to cooperate with the Placement Agent and its Counsel in
connection with the qualification of the Units for offer and sale
under the securities or Blue Sky laws of such jurisdictions as may be
applicable.
6.3. Amendments to the Memorandum. The Company covenants and agrees that,
if during the period specified herein, any event shall occur, as a
result of which, in the judgment of the Company or in the opinion of
Counsel for the Company, it becomes necessary to amend or supplement
the Memorandum in order to make the statements therein, in light of
the circumstances when the Memorandum is delivered to an offeree or
purchaser, not misleading, or if it is necessary to amend or
supplement the Memorandum to comply with any law, the Company shall
take all steps necessary to make such amendments and to inform the
Placement Agent so that it may furnish to Investors the amended
Memorandum so that the statements in the Memorandum as so amended or
supplemented will not, in the light of the circumstances when it is so
delivered, be misleading, or so that the Memorandum will comply with
the law, and to furnish to the Placement Agent and to such others as
applicable, such information in a timely fashion.
6.4. Complete Performance. The Company covenants and agrees to use its
best efforts to do and perform all things required or necessary to be
done and performed under this Agreement by the Company and to satisfy
all conditions precedent to the delivery of the Units.
7. Representations and Warranties of the Company. Subject to the
information set forth in this Agreement, the Memorandum, and the
exhibits to the Memorandum, the Company represents, warrants, and
agrees with the Placement Agent as follows:
7.1. Organization and Corporate Power. The Company is a corporation duly
organized, validly existing, and in good Standing under the laws of
the state of Nevada. The Company has all requisite corporate power and
authority and all material licenses, permits, and authorizations
necessary to own and operate its properties and to carry on its
business as now conducted and as presently proposed to be conducted,
and is in good standing in each jurisdiction or place where the nature
of its properties or the conduct of its business requires such
registration or qualification, except where the failure to so register
or qualify does not have a material adverse affect on the condition
(financial or otherwise), business, properties, net worth, or results
of operations of the Company. The copies of the articles of
incorporation and bylaws which have previously been provided to the
Placement Agent reflect all amendments made thereto at any time prior
to the date of this Agreement and are correct and complete.
7.2. Capital Stock and Related Matters. The authorized, issued, and
outstanding capital stock of the Company is as set forth in the
Memorandum. Except as set forth in the Memorandum, the Company does
not have outstanding any stock or securities convertible or
exchangeable for any units of its capital stock, and it is not subject
to any obligation (contingent or otherwise) to repurchase or otherwise
acquire or retire any units of its capital stock. All of the
outstanding units of the Company's capital stock have been duly
authorized and validly issued, are fully paid and nonassessable. There
are no preemptive rights of stockholders with respect to the shares
that would be issued in the event of conversion of the Units and, upon
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issuance, such shares will be validly issued, fully paid, and
nonassessable.
7.3. Authorizations, No Breach. The execution, delivery, and performance
of this Agreement and all other agreements and transactions
contemplated hereby have been duly authorized by the Company. This
Agreement and all other agreements contemplated hereby each
constitutes a valid and binding obligation of the Company, enforceable
in accordance with its terms. The execution and delivery by the
Company of this Agreement and all other agreements contemplated hereby
and the fulfillment of and compliance, with the respective terms
hereof and thereof by the Company are not and will not (i) conflict
with or result in a breach of the terms, conditions, or provisions of,
(ii) constitute a default under, (iii) result in the creation of any
lien, security interest, charge, or encumbrance upon the Company's or
any subsidiary's capital stock or assets pursuant to, (iv) give any
third party the right to accelerate any obligation under, (v) result
in a violation of the articles of incorporation or bylaws of the
Company, or any law, statute, rule, or regulation to which the Company
is subject, or any agreement, instrument, order, judgment, or decree
to which the Company is subject; or require any authorization,
consent, approval, exemption, or other action by or notice to, any
court or administrative or governmental body required to be filed as
of the date of this representation.
7.4. Financial Statements. The Memorandum shall contain audited balance
sheets of the Company as of the last auditable period immediately
prior to start of the private placement, and the related audited
statements of operations, stockholders' equity, and cash flows of the
Company including the footnotes thereto, together with the opinion of
the independent certified public accountants, with respect thereto.
Such financial statements shall have been prepared in accordance with
generally accepted accounting principles consistently followed
throughout the periods indicated. The Memorandum may also contain
unaudited financial statements (the "Latest Financial Statements").
The balance sheet of the Latest Financial Statements shall present
fairly, as of its date, the financial condition of the Company on such
date. The Company shall not have had, as of the date of such balance
sheets, except as and to the extent reflected or reserved against
therein (including the notes thereto), any liabilities or obligations
(absolute or contingent) of a nature customarily reflected in a
balance sheet or the notes thereto prepared in accordance with
generally accepted accounting principles. The statements of operations
of the Latest Financial Statements shall present fairly, the results
of operations of the Company for the periods indicated. The statements
of stockholders' equity and cash flows of the Latest Financial
Statements shall present fairly the information which should be
presented therein in accordance with generally accepted accounting
principles. The presentation of the Latest Financial Statements in
accordance with regulation S-X promulgated by the Securities and
Exchange Commission (the "Commission") regarding the form and content
of and requirements for financial statements to be filed with the
Commission would not materially and adversely affect the reported
amount of the Company's assets, stockholders' equity, or results of
operations as of any date or for any period included therein.
7.5. Independent Public Accountants. The independent public accountants,
whose report respecting the audited financial statements of the
Company is included in the Memorandum and who, as expert, having
reviewed certain other information of a financial nature contained in
the Memorandum, shall be independent certified public accountants as
required by the Securities Act.
7.6. No Material Adverse Change. Except as set forth in the Memorandum,
since the date of the Latest Financial Statements, there has been no
material adverse change in the Company's financial condition,
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operating results, business prospects, employee relations, customer
relations, or otherwise, other than changes occurring in the ordinary
course of business which in the aggregate shall have not been
materially adverse to the Company.
7.7. Absence of Certain Developments.
7.7.1 Except as expressly provided by this Agreement and except as
disclosed in or contemplated by the Memorandum, since the date of
the Latest Financial Statements the Company has not:
(a) issued any equity stock, bonds, or other securities;
(b) borrowed any amount or incurred or become subject
to any liabilities, except current liabilities
incurred in the ordinary course of business and
liabilities, under contracts entered into in the
ordinary course of business;
(c) discharged or satisfied any lien or encumbrance or paid
any obligation or liability, other than current
liabilities paid in the ordinary course of business;
(d) declared or made any payment or distribution of cash
or other property to stockholders with respect to its
stock, or purchased or redeemed any units of its capital
stock,
(e) mortgaged or pledged any of its properties or assets, or
subjected them to any lien, security interest, charge,
or any other encumbrance, except liens for current
property taxes not yet due and payable,
(f) sold, assigned, or transferred any of its tangible
assets, except in the ordinary course of business, or
canceled any debts or claims;
(g) sold, assigned, or transferred any patents, trademarks,
trade names, copyrights, trade secrets, or other
intangible assets, or disclosed any proprietary
confidential information to any person;
(h) suffered any extraordinary losses or intentionally
waived any rights of material value or compromised any
material claims, whether or not in the ordinary course
of business of consistent with past practice;
(i) made capital expenditures or commitments therefore that
aggregate in excess of $50,000;
(j) entered into any other transaction other than in the
ordinary course of business, or entered into any
other material transaction, whether or not in the
ordinary course of business,
(k) made charitable contributions or pledges, or
(1) suffered any damage, destruction, or casualty loss,
whether or not covered by insurance.
7.7.2 The Company has not at any time made any political contributions,
or any bribes, kickback payments, or other illegal payments.
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7.8. Assets
7.8.1 Except as set forth in the Memorandum or the Latest Financial
Statements, the Company has good and marketable title to, or a
valid leasehold interest in, the material properties and assets
shown on the Latest Financial Statements or in the Memorandum or
acquired thereafter, free and clear of all material liens,
security interests, charges and encumbrances, other than liens
for current property taxes not yet due and payable and as
disclosed in the Memorandum or the Latest Financial Statements.
7.8.2 Except as set forth in the Memorandum, the Company's buildings,
equipment, and other tangible assets are in good condition in all
material respects and are usable in the ordinary course of
business.
7.8.3 Except as set forth in the Memorandum, the Company owns, or has a
valid leasehold interest in, all assets necessary for the conduct
of its business as presently conducted.
7.9. Material Contracts. Except as set forth in the Memorandum, the
Company is not a party to any material contract (meaning thereby a
contract materially affecting its business or properties). No default
of any material significance exists in the due performance and
observance by the Company of any term, covenant, or condition of any
such contract; all such contracts are in full force and affect and are
binding on the parties thereto in accordance with their terms; and to
the knowledge of the Company, no other party to any such material
contract has threatened or instituted any action or proceeding wherein
the Company is alleged to be in default thereunder.
7.10. Tax Returns. Except as set forth in the Memorandum, the Company has
filed all federal, state and local tax returns which are required to
be filed and has paid all takes shown on such returns and 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 provided for by adequate reserves.
7.11. Proprietary Rights. Except as set forth in the Memorandum, the
Company, to the best of its knowledge, possesses all material
proprietary rights necessary to the conduct of its business. Except as
set forth in the Memorandum, (i) the Company, to the best of its
knowledge, owns all right, title, and interest in and to all such
proprietary rights, (ii) there have been no claims made against the
Company for the assertion of the invalidity, abuse, misuse, or
unenforceability of any of such rights, and to the best of the
Company's knowledge, there are no grounds for the same, (iii) the
Company has not received a notice of conflict with the asserted rights
of others, and (iv) to the best of the Company's knowledge, the
conduct of the Company's business has not infringed any proprietary
rights of others.
7.12. Litigation, Etc. Except as set forth in the, Memorandum, (i) there
are no actions, suits, proceedings, orders, investigations, or claims
pending or threatened against or affecting the Company at law or in
equity, or before or by any governmental department, commission,
board, bureau, agency, or, instrumentality, (ii) there are no
arbitration proceedings pending under collective bargaining agreements
or otherwise; (iii) there are no governmental inquiries (including
inquiries as to the qualification of the Company to hold or receive
9
any license or permit), and (iv) to the best of the Company's
knowledge, there is no basis for any of the foregoing.
7.13. Brokerage. Except as set forth in the Memorandum, there are no clalims
for brokerage commissions, finders' fees, or similar compensation in
connection with the transactions contemplated by this Agreement based
on any arrangement or agreement binding upon the Company. The Company
will pay, and hold the Placement Agent harmless against, any
liability, loss, damage, or expense (including, without limitation,
attorneys' fees and travel and out-of-pocket expenses) arising in
connection with any such claim.
7.14. Governmental Consent, Etc. No permit, consent, approval, or
authorization of, or declaration to or filing with, any governmental
authority is required in connection with the execution, delivery, and
performance of this Agreement by the Company or the consummation by
the Company of any other transactions contemplated hereby, except as
have been obtained or accomplished and except as expressly
contemplated herein or in the exhibits hereto.
7.15. Compliance with Laws. Except as set forth in the Memorandum, the
Company is not in violation of any law or any regulation or
requirements which might have a material adverse effect upon the
Company's business, and the Company has not received notice of any
such violation.
7.16. Disclosure. Neither this Agreement, its exhibits, nor any of the
attachments, written statements, documents, certificates, or other
items prepared or supplied by the Company with respect to the
transactions contemplated hereby contains any untrue statement of a
material fact or omits a material fact necessary to make the
statements contained herein or therein not misleading. The Memorandum
(i) describes accurately in all material respects the business,
condition (financial and otherwise), and operations of the Company;
(ii) contains substantially all information material to the purpose of
the Memorandum to the extent that the Company possesses such
information, and (iii) contains no untrue statement of a material fact
or omits to state any material fact necessary in order to make the
statements, in the light of the circumstances in which made, not
misleading. The Company acknowledges and agrees that all
responsibility for the accuracy and adequacy of information contained
in the Memorandum (other than information relating to the Placement
Agent made in reliance on and in conformity with information furnished
to the Company in writing by or on behalf of the Placement Agents
expressly for use therein) shall be the sole responsibility of the
Company and shall not be the responsibility of the Placement Agent;
and the Company shall promptly take such steps as are or may become
necessary to ensure the accuracy and adequacy thereto. Notwithstanding
the foregoing, with respect to projections and other forward looking
information, if any, contained in the Memorandum, the Company
represents only that such projections and other forward looking
information were prepared in good faith, that the Company believes it
has a reasonable basis for the projections and other forward looking
information and the assumptions on which they are based, that the
projections represent management's estimate of possible results of
operations, that the Company is not aware of any change in its
circumstances or other fact that has occurred that would cause it to
believe that it will be unable to meet the forecasts set forth in the
Memorandum.
7.17. Environmental Matters. The Company is in compliance with all
federal, state, local, and regional statutes, ordinances, orders,
judgments, rulings, and regulations relating to any environmental
matter of pollution or of environmental regulation or control to the
extent that any failure to comply therewith or violation thereof have
10
resulted or may result in material actual or potential fines,
penalties, or liabilities, and there are and have been no material
releases or threatened releases of "hazardous substances" into the
environment, as that term is defined in section 101(14) of the
Comprehensive Environmental Response Compensation and Liability Act,
as amended. The Company has no notice of any actual or claimed failure
to comply with such statutes, ordinances, orders, judgments, rulings,
or regulations with respect to environmental matters.
7.18. Material Transactions or Affiliations. Every contract, agreement,
or arrangement between the Company and any predecessor and any person
who is or has ever been an officer or director of the Company or
person owning of record, or known by the Company to own beneficially,
5% or more of the issued and outstanding common stock of the Company
and which is to be performed in whole or in part after the date hereof
or was entered into within three years before the date hereof was for
a bona fide business purpose of the Company, and the amount paid or
received, whether in cash, in services, or in kind, is, has been
during the full term thereof, and is required to be during the
un-expired portion of the term thereof, no less favorable to the
Company than terms available from otherwise unrelated parties in
arm's-length transactions. Each of the foregoing is accurately and
completely described in the Memorandum.
7.19. Use of Proceeds. The Company will apply the proceeds from the sale
of the Units in the manner set forth in the Memorandum under the
caption "Use of Proceeds."
7.20. Books and Records. The books, records and accounts of the Company and
its subsidiaries accurately and fairly reflect, in reasonable detail,
the transactions and dispositions of their respective assets. The
system of internal accounting controls maintained by the Company and
its subsidiaries is sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management's general
or specific authorization; (ii) transactions are recorded as necessary
(A) to permit preparation of financial statements and (B) to maintain
accountability, for assets; and (iii) access to assets is permitted
only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any difference.
8. Conditions to Obligations of the Company. The obligations of the
Company under this Agreement are, at the option of the Company,
subject to the satisfaction of each of the following conditions:
8.1. Suitability of Purchasers. The Company has reason to believe and
does believe, based on information provided to it by the Placement
Agent or otherwise, that each prospective purchaser is qualified to be
a purchaser pursuant to the suitability standards set forth in the
Memorandum and all applicable federal and state securities laws
8.2. Execution of Documents. Each prospective purchaser has completed and
executed a subscription agreement and an offeree suitability
questionnaire, all in such form that is acceptable to the Company.
8.3. Certificate of Placement Agent. The Placement Agent shall have
delivered to the Company executed certificates, one certificate dated
as of the date of each Closing, duly executed by a qualified
representative of the Placement Agent, stating that the actions of the
11
Placement Agent in making sales of the Units have been (i) in
conformance with the terms and conditions of the Memorandum, and (ii)
in compliance with the requirements of federal securities laws and
applicable state securities laws regarding the manner of offering such
Units.
8.4. Acceptance of Subscribers. The Company, in its good faith discretion,
has accepted as Investors the subscribers to whom Units are to be
issued at such Closing.
8.5. Representations. Each representation and warranty of the Placement
Agent contained in this Agreement or in any statement (including, but
not limited to the Memorandum and any financial statements),
certificate, schedule, or other document delivered pursuant hereto, or
in connection with the transactions contemplated hereby, shall
continue to be valid and shall be deemed to be made again at and as of
the time of the Initial Closing and each additional closing and shall
then be valid in all material respects.
9. Covenants of the Placement Agent.
9.1. Best Efforts. The Placement Agent covenants and agrees to use its
best efforts as the exclusive agent of the Company, to offer and sell
the Units; but this covenant shall not constitute an obligation or
guarantee to purchase or sell any or all of the Units. The right to
offer and sell is subject to and limited by the conditions in the
Memorandum and this Agreement.
9.2. Investor Privacy. The Placement Agent covenants and agrees to refrain
from soliciting Investors outside of the scope of this Agreement
without prior consent of the Company, unless the Placement Agent can
demonstrate a relationship between the Placement Agent and such
Investors, which relationship must have existed prior to the
contemplation of this Agreement.
9.3. Compliance with Securities Laws. The Placement Agent recognizes that
the Company is relying on certain exemptions from federal and state
registration of this offering, and therefore, further covenants and
agrees that:
9.3.1 It will comply with all the terms and conditions of the
Memorandum and applicable state and federal securities laws with
which it must comply in order to offer and sell the Units in
compliance with the exemptions of the Units from the registration
requirements of section 5 under sections 3(b), 4(2), and/or 4(6)
of the Securities Act and regulation D and rules 505 and 506
promulgated under the Securities Act and the rules and
regulations promulgated pursuant thereto, and other applicable
state securities laws;
9.3.2 It will maintain, and deliver a copy to the Company, a record of
names and addresses of persons to whom it delivered a copy of the
Memorandum, and the serial number of each such Memorandum so
delivered;
9.3.3 It will obtain a manually executed Subscription Agreement and
Suitability Questionnaire for each prospective purchaser and
shall assure that each such document has been completed;
9.3.4 It will have a reasonable belief that each subscriber presented
for consideration to the Company meets the minimum investor
suitability standards set forth in the Memorandum and, where
applicable, it shall have a reasonable belief that each
12
prospective purchase represented to be an "accredited investor"
does meet the qualifications for an "accredited investor" as set
forth in regulation D.
9.3.5 It will not offer or sell the Units by any form of general
solicitation or general advertising, including, but not limited
to, any advertisement; article, notice, or other communication in
any media and any meeting or seminar whose attendees have been
invited by any general solicitation or advertising as such terms
are interpreted for purposes of regulation D and under applicable
state securities laws;
9.3.6 It shall not make any factual statement or representation,
whether written or oral, concerning the Company, this Offering,
or the Units that is inconsistent with the representations
contained in the Offering materials presented to each prospective
purchaser by the Company or approved in writing by the Company;
9.3.7 It will exercise reasonable care to assure that the purchasers of
the securities are not underwriters within the meaning of section
2(11) of the Securities Act, which reasonable care may be
demonstrated by the following:
9.3.7.1. Reasonable inquiry to determine if the purchaser is
acquiring the securities for himself or for other
persons;
9.3.7.2. Written disclosure to each purchaser prior to sale that
the securities have not been registered under the
Securities Act and, therefore, cannot be resold unless
they are registered under the Securities Act or
unless an exemption from registration is available; and
9.3.7.3. Causing the placement of a legend on the certificate or
other document that evidences the Units stating that the
Units have not been registered under the Securities Act
and setting forth or referring to the restrictions on
transferability and sale of the Units.
9.3.8 It will not accept subscriptions that, by such acceptance, would
cause: (i) the number of purchasers to exceed the maximum number
of purchasers allowed by regulation D or under applicable state
securities laws, or (ii) the aggregate offering amount to exceed
the limitations imposed by regulation D or under applicable state
securities laws.
Notwithstanding anything contained in the foregoing provisions of
this section 9.3, or any other provisions of this Agreement, the
Company shall have responsibility with respect to determining the
requirements of state laws and to comply with the exemptions from
the securities registration or qualification requirements of such
states with respect to any filings required to comply with such
10. Representations and Warranties of the Placement Agent. The Placement
Agent represents and warrants that:
10.1. Organization and Corporate Power. It is a corporation duly organized,
validly existing, and in good standing under the law of the state of
Nevada, and has full corporate power and authority to execute this
Agreement and complete the transactions contemplated hereby.
10.2. Registration. It is in good standing and duly registered so that it may
undertake the acts and obligations contemplated by this Agreement, in
13
accordance with the rules and regulations of the U.S. Securities and
Exchange Commission ("SEC"), and the securities laws and regulations
of the Nevada Secretary of State Securities Division and any other
state in which it is contemplated that the Placement Agent may offer
and sell the Units.
10.3. NASD Licensing. It is a member in good standing of the National
Association of Securities Dealers, Inc. ("NASD") and will be able to
offer and sell the Units in compliance with exemptions from
registration under which the offering is to be conducted under the
Securities Act and the relevant state exemption from registration or
qualification in each state in which the Units will be offered or
sold, will have such licenses, approvals, and authorizations in any
states in which offers or sales of the Units are made at such time
that any such offers or sales are made, and is subject to no statutory
disqualification provisions including, but not limited to those
contained in Regulation Section 230.262.
10.4. Authorizations. The execution, delivery, and performance of this
Agreement has been duly authorized by all requisite corporate action
on behalf of the Placement Agent, and this Agreement has been duly
executed and delivered and constitutes the valid and binding
obligation of the Placement Agent.
10.5. No Breach. The execution and delivery by the Placement Agent of this
Agreement, the performance by the Placement Agent of this Agreement
and the completion of the transactions herein contemplated will not
conflict with or result in a breach of the terms of, or constitute a
default under or violation of, any law or regulation of any
governmental authority, domestic or foreign, or the articles of
incorporation or bylaws of the Placement Agent or any material
agreement or instrument to which the Placement Agent is a party or by
which it is bound or to which it is subject, nor will it give to
others any interests or rights, including rights of termination,
acceleration, or cancellation, in of with respect to any of the
properties, assets, agreements, contracts, or business of the
Placement Agent.
10.6. Governmental Consent, Etc. No permit, consent, approval, or
authorization of, or declaration to, or filing with, any governmental
authority is required in connection with the execution, delivery, and
performance of this Agreement by the Placement Agent or the
consummation by the Placement Agent of any other transactions
contemplated hereby, except as have been obtained or accomplished and
except as expressly acknowledged herein or in the exhibits hereto.
10.7. Litigation. The Placement Agent is not aware of any litigation or
threatened litigation, regulatory proceeding or order, disciplinary
proceeding or claim of violation, or any known basis for any of the
foregoing that could materially affect the ability of the Placement
Agent to carry out its functions as Placement Agent contemplated by
this Agreement.
11. Conditions to Obligations of Placement Agent. The obligations of the
Placement Agent under this Agreement are, at the option of the
Placement Agent, subject to the satisfaction at or prior to the
Initial Closing and through each additional closing, of each of the
following conditions,
11.1. Statutory Compliance/Consents. All statutory requirements for the
valid completion of the transactions contemplated by this Agreement
shall have been fulfilled, all authorizations, consents, and approvals
of all federal, state, local, and foreign governmental agencies and
authorities, and any membership in a regulatory or self-regulatory
organization required to be obtained in order to permit the completion
of the transactions contemplated by this Agreement shall have been
obtained.
14
11.2. No Material Adverse Clause. The business, properties, or operations of
the Company shall not have been adversely affected in any material way
as a result of any fire, accident, or other casualty or extraordinary
natural occurrence and there shall not have been incurred any material
adverse change in the business, properties, results of operations, or
financial condition of the Company.
11.3. Litigation. There shall not be any action, proceeding, investigation,
or pending or threatened litigation or arbitration, the purpose of
which is to enjoin or may be to enjoin the transactions contemplated
by this Agreement or which would have the effect, if successful, of
imposing material liability on the Company, or any of its officers or
directors thereof, or the Placement Agent, because of the completion
of the transactions contemplated by this Agreement.
11.4. Representations. Each representation and warranty of the Company
contained in this Agreement or in any statement (including, but not
limited to the Memorandum and any financial Statements), certificate,
schedule, or other document delivered pursuant hereto, or in
connection with the transactions contemplated hereby, shall continue
to be valid and shall be deemed to be made again at and as of the time
of the Initial Closing and each additional closing and shall then be
valid in all material respects.
11.5. Company Compliance. The Company shall have performed and complied in
all material respects with each and every covenant, agreement, and
condition required by this Agreement to be performed or complied with
by it prior to or at the initial closing and each additional closing.
11.6. Officers' Certification. The Company shall have delivered to the
Placement Agent certification as of the date of the Closing which
acknowledges the fulfillment of the conditions set forth in
subsections 11.1, 11.2, 11.3, 11.4, and 11.5 hereof.
11.7. Direction to Escrow Agent. The Company shall have directed the
Escrow Agent to pay directly to the Placement Agent at the Closing any
amounts due the Placement Agent as of such Closing pursuant to this
Agreement, upon request of the Placement Agent.
11.8. Further Certificates. The Company shall furnish or cause to have
furnished to the Placement Agent at such Closing such further
certification(s) and/or documents as the Placement Agent shall have
reasonably requested.
12. Compensation to Placement Agent; Expenses of Offering.
12.1. Payment of Fees and Commissions. Subject to the terms, conditions, and
covenants of this Agreement, the Company shall pay to the Placement
Agent, the following:
12.1.1 A non-accountable expense allowance of $30,000 payable
immediately upon execution of this Agreement by the Company;
12.1.2 A commission from the sale of the Units subject to the sale of
the Minimum Offering calculated as follows:
12.1.2.1. 0.5% of the gross proceeds from the sale of the Units
to Investors that, for purposes of meeting certain
requirements for exemption from registration, are
known personally to the Company;
15
12.1.2.2. 5% of the gross proceeds from the sale of the Units to
Investors that, for purposes of meeting certain
requirements for exemption from registration, are
known personally to the Placement Agent; or
12.1.2.3. 0.5% of the gross proceeds from the sale of the Units
if the Placement Agent cannot clearly determine
whether 12.1.2.1 or 12.1.2.2 above applies.
12.1.3 A flat fee of $15,000 subject to the sale of the Minimum Offering
payable by the Company immediately upon closing of the Offering
pursuant to this Agreement;
12.1.4 Up to 25,000 shares of Common Stock of the Company to be issued
by the Company to the Placement Agent immediately upon closing of
the Offering pursuant to this Agreement, which shares shall be
restricted subject to applicable rules and regulations, including
NASD Conduct Rule 2710(c)(7)(A). The actual number of shares of
Common Stock of the Company to be issued to the Placement Agent
shall be the lower of 25,000 shares or the maximum allowed under
NASD Conduct Rule 2710(c)(6)(B)(xi) (the "stock numerical
limitation"). If, prior to the closing of the Offering pursuant
to this Agreement, the Company effects a stock split, declares a
stock dividend, or makes another proportionate adjustment to the
number of issued and outstanding shares of Common Stock of the
Company, the maximum number of shares of Common Stock of the
Company to be issued to the Placement Agent shall be adjusted
equitably and proportionately.
12.2. Company Offering Expenses. The Company will pay all its costs and
expenses in connection with the private placement of the Units,
including, but not limited to, accountants' fees, legal fees, escrow
fees, printing and distribution costs, travel expenses of its
employees, miscellaneous sales expenses, and filing fees, if any.
12.3. Placement Agent Expenses. The Placement Agent will be responsible
for the payment of all fees and expenses, other than those referred to
in 12.1 reasonably incurred by it in performing its obligations
hereunder.
13. Indemnification
13.1. Company Indemnification. The Company will indemnify and hold harmless
the Placement Agent against any losses, claims, damages, or
liabilities, joint or several, to which the Placement Agent may become
subject, insofar as such losses, claims, damages, or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in
the Memorandum or any amendment or supplement thereto, or arise out of
or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse the Placement
Agent for any legal or other expenses reasonably incurred by the
Placement Agent in connection with investigating or defending any such
action or claim; provided, however, that the Company shall not be
liable in any case to the extent that any such loss, claim, damage, or
liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in the
Memorandum or such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by the
Placement Agent directly or through the Placement Agent expressly for
use therein; provided further, that in no event shall the
indemnification agreement contained in this subsection inure to the
16
benefit of the Placement Agent (or any person controlling the
Placement Agent) on account of any losses, claims, damages,
liabilities, or actions arising from the sale of the Units pursuant to
the Offering to any person by the Placement Agent if such losses,
claims, damages, liabilities, or options arise out of, or are based
upon, an untrue statement or omission or alleged untrue statement or
omission in the Memorandum or any amendment or supplement thereto
based upon and in conformity with written information furnished to the
Company by the Placement Agent specifically for use therein.
The indemnity agreement in this subsection shall be in addition to any
liability which the Company may otherwise have and shall extend upon
the same terms and conditions to each officer, director, or partner of
the Placement Agent and to each person, if any, who controls the
Placement Agent within the meaning of section 15 of the Securities
Act.
13.2. Placement Agent Indemnification. The Placement Agent will indemnify
and hold harmless the Company against any losses, claims, damages, or
liabilities to which the Company may become subject insofar as such
losses, claims, damages, or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in the Memorandum or any
amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that
such untrue statement or alleged untrue statement or omission or
alleged omission was made in the Memorandum or any amendment or
supplement thereto, in reliance upon and in conformity with written
information furnished to the Company by such Placement Agent expressly
for use therein.
The indemnity agreement in this subsection 13.2 shall be in addition
to any liability which the Placement Agent may otherwise have and
shall extend, upon the same terms and conditions, to each officer and
director of the Company and to each person, if any, who controls the
Company within the meaning of the Securities Act.
13.3. Notice of Claim. Promptly after receipt by an indemnified party under
subsection 13.1 or 13.2 of notice of the commencement of any action,
such indemnified party shall, if a claim in respect thereof is to be
made against an indemnifying party under this section, notify the
indemnifying party in writing of the commencement thereof; but the
omission so to notify the indemnifying party shall not relieve it from
any liability which it may have to any indemnified party otherwise
than under this section.
In case any such action shall be brought against any indemnified party
and it shall notify the indemnifying party of the commencement
thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof,
with counsel satisfactory to such indemnified party; and after notice
from the indemnifying party to such indemnified party of its election
so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under this section for any legal or
other expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs of
investigation.
14. Miscellaneous.
14.1. Expenses. The Company will pay, and hold the Placement Agent harmless
against liability for the payment of (i) reasonable fees and expenses
incurred with respect to any amendments or waivers requested by the
17
Company (whether or not the same become effective) under or in respect
of this Agreement, the Units, or the other agreements contemplated
hereby; (ii) stamp and other taxes which may be payable in respect to
the execution and delivery of this Agreement or the issuance,
delivery, or sales of the Units or any units of Common stock issuable
on conversion of the Units; and (iii) reasonable fees and expenses
incurred, as against the Company, in respect of the enforcement of the
rights granted under this Agreement, the Units, or the other
agreements contemplated hereby.
14.2. Notice. All notices or demands shall be in writing and shall be served
personally, te1egraphically, or by express or certified mail. Services
shall be deemed conclusively made at the time of service if personally
served; at the time that the telegraphic agency confirms to the sender
delivery thereof to the addressee if served telegraphically; 48 hours
after deposit thereof in the United States mail properly addressed and
postage prepaid, return receipt requested, if served by express mail;
and five days after deposit thereof in the United States mail,
properly addressed and postage prepaid, return receipt requested, if
served by certified mail; if sent by facsimile transmission, confirmed
with a written copy thereof sent by overnight express delivery; or if
sent by overnight express delivery. Any notice or demand to the
parties shall be given to:
To the Company:
OneCap
0000 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxx, Xxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx
Telecopy: (000) 000-0000
To the Placement Agent:
NevWest Securities Corporation
0000 Xxxx Xxxxxxx Xxxxx Xxxxxxx Xxxxx X-0
Xxxxxxxxx, Nevada 89052
Attn: Xxxxxx X. Xxxxxx, Esq.
Telecopy: (000) 000-0000
Any party may change its address by providing written notice of such
change to the other parties hereto.
14.3. Remedies. The Placement Agent and the Company will have all rights
and remedies set forth in this Agreement. Any person having any rights
under any provision of this Agreement will be entitled to enforce
these rights specifically, to recover damages by reason of any breach
of any provision of this Agreement, and to exercise all other rights
granted by law.
14.4. Consent to Amendments and Waivers. Except as otherwise expressly
provided herein, the provisions of this Agreement may be amended, and
the Company or the Placement Agent, as the case may be, may take any
action herein prohibited, or omit to perform any act herein required
to be performed by it, only if it has obtained the written consent of
the other. No course of dealing between the Company and the Placement
Agent or any delay in exercising any rights hereunder will operate as
a waiver of any rights of the Placement Agent or the Company.
18
14.5. Survival of Representations and Warranties. All representations and
warranties contained herein or made in writing by any party in
connection herewith will survive the execution and delivery of this
Agreement regardless of any investigation made by the Placement Agent,
the Company, or on their respective behalves.
14.6. Successors and Assigns. Except as otherwise expressly provided
herein, all covenants and agreements contained in this Agreement by or
on behalf of any of the parties hereto will bind and inure to the
benefit of the respective successors and assigns of the parties hereto
whether so expressed or not.
14.7. Entire Agreement, Amendments. This Agreement and the Exhibits and
Schedules referred to herein and the documents delivered pursuant
hereto contain the entire understanding of the parties hereto with
regard to the subject matter contained herein or therein, and
supercedes all prior agreements, understandings or letters of intent
between of among any of the parties hereto. This Agreement shall not
be amended, modified or supplemented except by a written instrument
signed by an authorized representative of each of the parties hereto.
14.8. Severability. Whenever possible, each provision of this Agreement will
be interpreted in a manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be
prohibited by or invalid Xxxxxx applicable law, that provision will be
ineffective only to the extent of the prohibition or invalidity,
without invalidating the remainder of this Agreement.
14.9. Term and Termination. This Agreement shall terminate on the first to
occur of the sale of all Units to be offered and sold pursuant hereto
or the expiration of 180 days after the date hereof, unless extended
for up to 30 additional days on the agreement of the Company and the
Placement Agent, in which event this Agreement shall terminate an the
expiration of such extension.
14.10. Counterparts. This Agreement may be executed in two or more
counterparts, any one of which need not contain the signatures of more
than one party, but all counterparts taken together will constitute
one and the same Agreement.
14.11. Descriptive Heading. The descriptive headings of this Agreement are
inserted for convenience only and do not constitute a part of this
Agreement.
14.12. Governing Law. The construction, validity, and interpretation of
this Agreement and the exhibits and schedules hereto will be governed
by the laws of the state of Nevada.
14.13. Final Approval. This Agreement in its entirety, is subject to final
written authorization by the then General Counsel for NevWest
Securities Corporation (the Placement Agent) and is contingent upon a
satisfactory due diligence review by the Placement Agent which shall
have the discretion to proceed with the offering as contemplated
herein or terminate its services depending upon its findings in the
process of conducting a due diligence review of the Company. Any
accountable expense amounts expended in the process of conducting this
due diligence review shall be retained by the Placement Agent. Any
amount not otherwise expended shall be returned to the Company within
ten (10) days of written notice from the Placement Agent indicating
its election not to proceed.
19
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be
effective on the date first written above.
OneCap
Signature: /s/ Xxxxxxx Xxxxxx, President Date: July 16, 2001
Xxxxxxx Xxxxxx, President
NevWest Securities Corporation
Signature: /s/ Xxxxxx Xxxxxxxxxx Date: July 16, 2001
Xxxxxx Xxxxxxxxxx, President & CEO
