Contract
Exhibit
4.10
February
24, 2005
InSite
Vision Incorporated
X.
Xxxxx
Xxxxxxxxxxxxxx, Ph.D.
President
and Chief Executive Officer
000
Xxxxxxxx Xxxxxx
Xxxxxxx,
XX 00000
Dear
Xx.
Xxxxxxxxxxxxxx:
Reference
is made to our recent discussions relating to the proposed private placement
by
InSite Vision Incorporated (the “Company”), of certain of its securities
pursuant to Rule 506 of Regulation D of the Securities Act of 1933 (the “Act”),
as hereinafter described. Based upon our discussions, your representations
to us
and our investigation of the Company and its principals, the present and
proposed business activities of the Company and the Company's operations
and
financial condition, Paramount BioCapital, Inc. (“Paramount”) hereby agrees to
act as exclusive placement agent for the Company, on a “best efforts” basis, to
introduce the Company to qualified investors (“Investors”) in connection with a
private placement offering (the “Offering”) of the Company's securities, upon
the following basic terms and conditions:
1.The
Offering. The
Company will offer to sell debt or equity securities ( the “Securities”)
representing or convertible into the Company’s common stock, par value $0.01 per
share (the “Common Stock”), to persons who qualify as “accredited investors” as
defined in Rule 501 of Regulation D promulgated under the Act upon terms
to be
agreed upon by such Investors and the Company (the “Offering”) yielding
aggregate gross proceeds to the Company of up to $10 Million (the “Maximum
Offering”). The terms and conditions of the purchase and sale of the Securities
in the Offering will be evidenced by a written subscription agreement between
the Company and each investor in the Offering (the “Subscription Agreement”).
For purposes of this letter agreement, the term “Offering Documents” shall mean
the Subscription Agreements and related transaction documents to be drafted
subsequent to the date hereof but prior to the offering of any of the Company’s
Securities and any other document prepared or approved by the Company and
provided to investors in connection with the Offering, if any (collectively
the
“Offering Documents”).
2. Closing. Subject
to agreement between the Investors and the Company with respect to the Offering
Documents, the Company intends to conduct one or more closings (each a
“Closing”) of the Offering on or before March 31, 2005 subject to extension at
the Company’s discretion without notice to investors for up to an additional 90
days (the “Final Closing Date”), until the date on which the Maximum Offering is
met. Prior to any Closing, all subscription amounts will be deposited in
a
segregated escrow account with an escrow agent reasonably acceptable to the
Company and Paramount. Unless terminated earlier in either the Company’s or
Paramount’s sole discretion, the offering period (the “Offering Period”) will
expire on the earlier of (i) the Final Closing Date; (ii) the date on which
the
Maximum Offering has been sold (iii) and March 31, 2005 (only if no Closing
shall occur) (the “Termination Date”).
4. Placement
Fees. Subject
to the reduced Cash Commissions in the case of Affiliated Investments, as
set
forth below, (a) upon (i) each Closing and (ii) the closing of any Investment
(as defined below), the Company will (x) pay to Paramount or its designees
placement fees, in cash, equal to seven percent (7%) of the proceeds received
by
the Company at such Closing or at the closing of such Investment, as applicable
(the “Cash Commissions”) and (y) issue to Paramount or its designees warrants
(the “Placement Warrants”) to purchase a number of shares of the Securities (the
“Placement Warrant Shares”) equal to 5% of the number of Securities actually
sold (not including warrants or other securities for which no cash consideration
was received upon issuance) at each Closing or at the closing of each Investment
(as applicable) (the Cash Commissions and Placement Warrants are referred
to
collectively herein as the “Placement Fees”). The Placement Warrants, a form of
which shall be agreed to in good faith by the parties and based substantially
on
the form of placement warrant previously issued by the Company to Paramount,
shall have a purchase price of $0.02 per Placement Warrant (payable by Paramount
to the Company upon issuance of each such Placement Warrant) and shall have
an
exercise price per share equal to 110% of the per share price at which the
Securities are sold at the Closing or in the Investment (as applicable),
adjust
for stock splits, reverse stock splits, re-organizations, etc., have a cashless
exercise feature, and be exercisable for 5 years from the Final Closing Date.
For purposes of this Agreement, an “Investment” shall mean any original issuance
of securities of the Company which is made during the 12-month period following
the Termination Date or earlier termination or expiration of the Offering
to an
investor first introduced to the Company by or through Paramount (each an
“Investor”). Investors will include any person or entity that participates in
the Offering. Additionally, Paramount will provide the Company with a list
of
the Investors introduced to the Company on the date of the Termination Date
or
earlier termination or expiration of this Agreement that did not participate
in
any Offering, but were nevertheless introduced to the Company by Paramount.
Such
list will include (i) Proquest and Proquest’s affiliated funds specifically
named in the schedule attached hereto; (ii) any person or entity for which
the
Company had a face to face meeting or a conference call arranged by Paramount
during which the Company was able give a presentation to such entity or person
concerning the Offering and (iii) any other person or entity that was introduced
to the Company by Paramount provided the Company agrees, based on its sole
reasonable determination in good faith, such person or entity was introduced
to
the Company by Paramount. Paramount, its employees and affiliates shall have
the
right to invest in the Offering provided they are accredited investors (each
an
"Affiliated Investment"). Cash Commissions with respect to any Affiliated
Investment shall be three and a half percent (3.5%) of the proceeds received
by
the Company from such Affiliated Investment and no other Cash Commissions
will
be paid with respect to such Affiliated Investment.
(b) In
consideration for the Company’s inclusion of the Placement Warrant Shares in the
Registration Statement, Paramount agrees that it shall be deemed a “Holder”
under the Subscription Agreement or other document granting the investors
registration rights in the Offering and, accordingly, it shall abide by all
of
the terms, conditions and limitations set forth in such documents. Accordingly,
the Company agrees that the shares underlying the Placement Warrants shall
be
afforded equivalent registration rights as the Securities sold in the Offering
or in the Investment pursuant to which the Placement Warrants are issued,
as
applicable.
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5. Expense
Allowance.
At the
Closing, the Company shall reimburse Paramount for its reasonable, documented
expenses actually incurred up to a maximum of $30,000 (the “Expense Allowance”)
to cover Paramount’s reasonable and verifiable out-of-pocket expenses incurred
in connection with the Offering. Legal fees in connection with blue sky matters
will be the responsibility of the Company.
6. Confidentiality.
Unless
required by applicable law or the rules of a regulatory body (which shall
be
determined by the Company in its sole discretion upon advice of its legal
counsel), any services and advice rendered by Paramount pursuant to this
Agreement (and the existence of this Agreement) shall not be disclosed publicly
in any manner without Paramount’s prior written approval and shall be treated by
the Company as confidential information. All material non-public information
given to Paramount by the Company shall be treated by Paramount as confidential
information and shall not be disclosed in any manner without Company’s prior
written approval and shall not be used by Paramount except in rendering its
services pursuant to this Agreement.
7. Conditions
to Paramount's Obligations.
The
obligations of Paramount hereunder are subject to (i) (A) the accuracy of
the
representations and warranties of the Company herein contained as of the
date
hereof and as of the date of each Closing; and (B) in each of the Offering
Documents as of the date of each Closing; (ii) to the performance by the
Company
of its obligations hereunder; and (iii) to the following additional
conditions:
(a) Due
Qualification or Exemption.
(1) The
Offering contemplated by this Agreement shall become qualified or be exempt
from
qualification under the securities laws of the jurisdictions in which the
Securities are contemplated to be offered not later than the Final Closing
Date,
subject to any filings to be made thereafter and (2) at the Final Closing
Date
no stop order suspending the sale of the Securities shall have been issued,
and
no proceeding for that purpose shall have been initiated or
threatened;
(b) Compliance
with Agreements.
Except
for such agreements and conditions that expressly may be performed or satisfied
after the Final Closing Date, the Company shall have complied with all
agreements and satisfied all conditions that the Company is required to perform
or satisfy hereunder and under the Offering Documents at or prior to each
Closing or the Final Closing, as applicable;
(c)
Corporate
Action.
The
Company shall have taken all corporate action necessary in order to permit
the
valid execution, delivery and performance of the Offering Documents by the
Company, including, without limitation, obtaining the approval of the Company's
board of directors, for the execution and delivery of the Offering Documents,
the performance by the Company of its obligations hereunder and the Offering
contemplated hereby;
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(d) Opinion
of Counsel to the Company.
Paramount shall have received an opinion of counsel to the Company reasonably
satisfactory to Paramount and its counsel in the form mutually agreed to
in good
faith by the parties;
(e) Officer's
Certificate.
Paramount shall receive an Officer's Certificate, signed by the appropriate
parties and dated as of the Closing Date in the form mutually agreed to in
good
faith by the parties . The certificate shall state, among other things, that
the
representations and warranties contained herein and in the Offering Documents
are true and accurate in all material respects at such Closing Date with
the
same effect as though expressly made at such Closing Date and Paramount shall
be
entitled to rely on such representations of the Company in the Offering
Documents as if they were made directly to Paramount;
(f) Escrow
Agreement.
The
Company, Paramount and an escrow agent reasonably acceptable to the parties
shall execute an Escrow Agreement for the purpose of holding funds until
each
Closing;
(g) No
Adverse Changes.
There
shall not have occurred, at any time prior to each Closing: (i) any domestic
or
international event, act or other similar occurrence which has disrupted,
or in
Paramount’s sole determination, will materially disrupt, the securities markets;
(ii) a general suspension of, or a general limitation on prices for, trading
in
securities on the principal market or exchange on which the Common Stock
is then
traded for more than one-trading day; (iii) any outbreak of major hostilities
or
other national or international calamity having a material effect on the
performance of this Agreement; (iv) any banking moratorium declared by a
state
or federal authority; (v) any material interruption in the mail service or
other
means of communication within the United States; (vi) any materially adverse
change in the business, properties, assets, results of operations, prospects
or
financial condition of the Company; or (vii) any change in the market for
securities in general or in political, financial or economic conditions which,
in Paramount’s reasonable judgment, makes it inadvisable to proceed with the
offering, sale, and delivery of the Securities.
8. Covenants
of the Company.
(a) Notification.
The
Company shall notify Paramount immediately, and in writing, when any event
shall
have occurred during the period commencing on the date hereof and ending
on the
Closing Date as a result of which the Offering Documents would 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 not misleading
in light of the circumstances under which they were made.
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(b) Blue
Sky.
The
Company shall use its reasonable commercial efforts to qualify the Securities
for offering and sale under exemptions from qualification or registration
requirements under the securities or “blue sky” laws of such jurisdictions, as
Paramount may reasonably request; provided however, that the Company will
not be
obligated to qualify as a dealer in securities in any jurisdiction in which
it
is not so qualified or to subject itself to the jurisdiction of any jurisdiction
where it is not already subject. The Company will not consummate any sale
of
Securities in any jurisdiction in which it is not so qualified or in any
manner
in which such sale may not be lawfully made.
(c) Form
D
Filing.
The
Company shall file five copies of a Notice of Sales of Securities on Form
D with
the SEC no later than 15 days after the date of the first Closing. The Company
shall promptly file such amendments to such Notices on Form D as shall become
necessary and shall also comply with any filing requirement imposed by the
laws
of any state or jurisdiction in which offers and sales are made.
(d) Press
Releases, Etc.
Except
as otherwise required by applicable law or the rules of a regulatory body
(which
shall be determined by the Company in its sole discretion upon advice of
its
legal counsel), the Company shall not, during the period commencing on the
date
hereof and ending 30 days after the Closing Date, issue any press release
or
other communication (other than its year-end earnings release and conference
call or other releases or communications made in the ordinary course of the
Company’s business consistent with past practice, provided, however, the
placement agent is provided a reasonable opportunity to review and comment
on
such release or other written communication), make any written or oral statement
to any media organization or publication or hold any press conference,
presentation or seminar, or engage in any other publicity with respect to
the
Company, its financial condition, results of operations, business, properties,
assets, or liabilities, or the Offering, without the prior consent of Paramount,
which consent shall not be unreasonably withheld, conditioned or delayed.
(e) No
Statements.
Except
as otherwise required by applicable law or the rules of a regulatory body
(which
shall be determined by the Company in its sole discretion upon advice of
its
legal counsel), the Company shall not use the name of Paramount or any officer,
director, employee or shareholder thereof without the express consent of
such
party and such person.
(f) Expenses.
The
Company is liable for, and will pay, its own expenses incurred in connection
with the negotiation, preparation, execution and delivery of this Agreement,
including, without limitation, its attorneys’ fees.
(h) Right
of First Refusal:
In the
event that a Closing occurs pursuant to this letter, the Company hereby grants
Paramount a right of first refusal (the “Right of First Refusal”) to act as the
Company's placement agent in connection with any offering by the Company
of its
debt or equity securities to be conducted, with the assistance of a placement
agent, during the period commencing on the Final Closing Date and ending
on the
close of business on December 31, 2005. Prior to engaging another placement
agent in connection with such an offering (an “Alternative Engagement”), the
Company shall provide notice to Paramount setting forth in reasonable detail
the
terms and conditions of such proposed Alternative Engagement, which notice
shall
be deemed to be an offer by the Company to enter into a comparable engagement
with Paramount on the terms and subject to the conditions set forth in the
notice (the “Alternative Engagement Notice”). Paramount shall have 10 days
following the day it receives the Alternative Engagement Notice to elect,
in
writing, to accept the engagement pursuant to the terms and conditions set
forth
in the Alternative Engagement Notice. Paramount shall notify the Company
in
writing of its decision to accept or reject the engagement terms set forth
in
the Alternative Engagement Notice before the expiration of such 10 day period,
and failure by Paramount to provide the
5
Company
with such notice shall be deemed to be a rejection by Paramount. In the event
Paramount elects to reject or fails to respond to the Alternative Engagement
Notice, the Company shall have the right to consummate the proposed Alternative
Engagement substantially in accordance with the terms described in the
Alternative Engagement Notice (with such other terms and conditions which
are
customary and appropriate for such transactions to be agreed upon by the
parties); provided that an Alternative Engagement not substantially in
accordance with the terms described in the Alternative Engagement Notice
will
again become subject to the Right of First Refusal
(i) No
Material Misstatements.
Neither
the Blue Sky qualification materials, the "Offering Documents" nor any
attachment or supplement thereto, or any filing the Company has made with
the
SEC since March 1, 2004 contains an untrue statement of a material fact or
omits
to state a material fact which is required to be stated therein or is necessary
to make the statements therein, in light of the circumstances under which
they
are made, not misleading and the Company has made all SEC filings required
by
the SEC from March 1, 2004 through the date of this Agreement.
(j) Use
of
Proceeds.
The net
proceeds from the Offering will be used for research and development fees
and
expenses, including pre-clinical and clinical studies, and for working capital
and general corporate purposes. The Company may also use a portion of the
net
proceeds for the acquisition of businesses, products and technologies that
the
Company believes are complementary to those of the Company, although no portion
of the net proceeds has been specifically allocated for any specific
acquisition. Other than accounts payable and accrued expenses incurred in
the
ordinary course of business, the Company shall not, until the earlier to
occur
of (i) March 31, 2007 and (ii) the successful completion of a pivotal Phase
III
clinical trial with respect to the Company’s AzaSite product candidate, use any
proceeds from the Offering to repay any indebtedness of the Company including,
but not limited to, any indebtedness to current executive officers or principal
stockholders of the Company; provided,
however,
following the Closing the Company may repay up to an aggregate of $200,000
in
outstanding principal and accrued but unpaid interest with respect to
outstanding indebtedness of the Company.
(k) Expenses
of Offering.
The
Company shall be responsible for and shall bear all Company Expenses (as
defined
below). For the purposes of this Agreement, the “Company Expenses” shall
include: the costs of preparing and duplicating the Offering Documents and
all
exhibits thereto; the costs of preparing, printing and filing with the SEC
any
registration statement described in the Subscription Agreement (a “Registration
Statement”) and any amendments, post-effective amendments and supplements
thereto; preparing, duplicating and delivering exhibits thereto and copies
of
the preliminary, final and supplemental prospectus; preparing, duplicating
and
delivering (including by facsimile) all selling documents, including but
not
limited to the SEC Documents, this Agreement, the Subscription Agreements,
blue
sky memoranda and stock certificates; blue sky fees, filing fees; fees and
disbursements of the Company’s transfer agent (collectively, the “Company
Expenses”). The Company shall also be responsible for reimbursement of the
Placement Agent for any costs incurred in connection with the preparation
of the
Offering Documents (including, without limitation, reasonable attorney’s fees,
expenses and disbursements). In no event shall the Company reimburse the
Placement Agent for an amount greater than the Expense Allowance.
6
(l) Restrictions
on Securities.
Except
as a result of any stock splits and reverse stock splits and except as otherwise
contemplated hereby, or required by a pre-existing legal or contractual
obligation, during the period commencing on the Final Closing Date and ending
on
the close of business on June 14, 2005, the Company will not extend the
expiration date or lower the exercise or the conversion price of any options,
warrants, convertible securities or other security purchase rights without
the
prior written consent of the Placement Agent, which such consent will not
be
unreasonably withheld, conditioned or delayed.
(m) Paramount
shall be entitled to rely on the Company’s representations and warranties given
to each investor in the Offering in the Subscription Agreement as if such
representation and warranty was given by the Company to Paramount.
(n) The
Company represents and warrants that it has all requisite corporate power
and
authority to execute and deliver this Agreement and to carry out the
transactions contemplated by this Agreement. The Company is not in violation
of
or default under, nor will the execution and delivery of this Agreement and
consummation of the transactions contemplated herein will not result in a
violation of, or constitute a default in the performance or observance of
any
law, obligation under its certificate of incorporation, as amended, or its
by-laws, or any indenture, contract, material purchase order or other agreement
or instrument to which the Company is a party or by which it or its property
is
bound or affected.
9.
Indemnification. In
consideration for Paramount’s services on behalf of the Company in connection
with the Offering, the Company agrees to indemnify and hold harmless Paramount
and each of its affiliates, stockholders, directors, officers, employees,
agents
and controlling persons (within the meaning of Section 15 of the Act or Section
20 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) to
the extent set forth, and as provided for, in the indemnification and
contribution provisions (the “Indemnification Provisions”) attached hereto as
Exhibit
D
and
incorporated herein in their entirety. Paramount shall indemnify and hold
harmless the Company and each of its affiliates, stockholders, directors,
officers, employees, agents and controlling persons within the meaning of
the
Act and Exchange Act to the same extent as set forth in the indemnity from
the
Company to Paramount in Exhibit
D,
but
only in connection with (i) information relating to Paramount furnished in
writing to the Company by Paramount for the specific purpose of including
such
information in the Offering Documents or any Securities and Exchange Commission
filing, (ii) material breaches of the representations and warranties of
Paramount set forth in Section 10 hereof, and (iii) any and all losses, claims,
expenses, damages and liabilities arise out of the bad faith, gross negligence
or willful misconduct of Paramount.
10. Representations
and Warranties of Placement Agent. Paramount
represents and warrants to the Company, as of the date hereof, and as of
the
date of each Closing as follows:
7
(a) it
is a
member of the National Association of Securities Dealers, Inc. (“NASD”) and it
has, and at all times while taking any actions constituting an offer or sale
of
the Securities had, all governmental licenses (including both federal and
state
broker dealer licenses) required to act as placement agent for the
Securities.
(b) it
has
not used any general solicitation or general advertising in its offering
of the
Securities or used any offering materials not approved by the Company in
writing.
(c) it
reasonably believes that the subscribers contacted by Paramount satisfy the
investor suitability standards set forth in Regulation D.
11. Termination;
Survival. Either
the Company or Paramount may terminate this Agreement at any time prior to
any
Closing in their respective sole discretion, with or without cause, and without
liability whatsoever. Sections 4, 5, 6, 9, 11 through 15 of this Agreement
shall
remain operative and in full force and effect regardless of any expiration
of
this Agreement or termination of this Agreement by the Company. Sections
6, 9,
10, 11 through 15 of this agreement shall remain operative and in full force
and
effect regardless of any termination of this Agreement by
Paramount.
12. Governing
Law. This
Agreement shall be governed by and construed in accordance with the laws
of the
State of New York without regard to principles of conflicts of law. The parties
hereby irrevocably submit to the exclusive jurisdiction of the courts of
the
State of New York.
13. Binding
Agreement; Non-Assignability. This
Agreement shall be binding upon and inure to the benefit of Paramount and
the
Company and each of their successors and assigns. This Agreement may not
be
assigned by either party without the prior written consent of the
other.
14. Other
Services.
Subject
to Section 6 of this Agreement, nothing herein shall restrict or otherwise
limit
Paramount from performing similar or dissimilar services for any other party
or
for its own account. The provisions of this paragraph 14 shall be enforceable
to
the fullest extent permitted by law.
15. Miscellaneous.
This
Agreement embodies the entire agreement and understanding between the parties
hereto and supersedes any prior agreements or understandings, oral or written,
relating to the subject matter hereof, including that certain letter agreement
between Paramount and the Company dated as of February 12, 2004. If any
provision of this Agreement is determined to be invalid or unenforceable
in any
respect, such determination will not affect such provision in any other respect
or any other provision of this Agreement, which will remain in full force
and
effect. This Agreement may not be amended or otherwise modified or waived
except
by an instrument in writing signed by both the Company and
Paramount.
Remainder
of page left intentionally blank.
Signature
page follows.
8
If
the
foregoing conforms to your understanding, please sign and return to us the
enclosed copy of this letter.
Very
truly yours,
PARAMOUNT
BIOCAPITAL, INC.
By:
/s/Xxxxxxx X. Xxxxxxxxx
Name: Xxxxxxx
X. Xxxxxxxxx, M.D.
Title: Chairman
and Chief
Executive Officer
INSITE
VISION, INC.
By:
/s/X. Xxxxx Xxxxxxxxxxxxxx
Name:
X.
Xxxxx Xxxxxxxxxxxxxx, Ph.D.
Title: President
& Chief Executive Officer
9
Exhibit
A
INDEMNIFICATION
PROVISIONS
In
connection with (i) the engagement of Paramount BioCapital, Inc. (the “Placement
Agent”), by InSite Vision Incorporated (the “Company”), pursuant to that certain
letter agreement dated February 24, 2005, between the Company and the Placement
Agent, as it may be amended from time to time (the “Agreement”), and (ii) the
offering set forth in the Agreement (the “Offering”), the Placement Agent and
the Company (each, a “Party” and collectively the “Parties”) hereby agree as
follows:
To
the
extent permitted by law, the Company will indemnify the Placement Agent and
its
affiliates, and the directors, officers, partners, shareholders, agents and
employees of the Placement Agent (collectively the “Indemnified Persons”),
harmless from and against any and all claims, actions, suits, proceedings
(including those of shareholders), damages, liabilities and expenses incurred
by
any of them (including, but not limited to, fees and expenses of counsel)
which
are related to or arise out of (i) any actions taken or omitted to be taken
(including any untrue statements made or any statements omitted to be made)
by
the Company in connection with the Offering, or (ii) any actions taken or
omitted to be taken by any Indemnified Person in connection with the Company’s
engagement of the Placement Agent pursuant to this Agreement and the Company
shall reimburse any Indemnified Person for all expenses (including, but not
limited to, reasonable fees and expenses of counsel) incurred by such
Indemnified Person in connection with investigating, preparing or defending
any
such claim, action, suit or proceeding (collectively a “Claim”), whether or not
in connection with pending or threatened litigation in which any Indemnified
Person is a party. The Company will not, however, be responsible for any
Claim
which is finally judicially determined to have resulted primarily from the
gross
negligence, bad faith or willful misconduct of any person seeking
indemnification hereunder or a breach by the Placement Agent of the
representations and warranties set forth in Section 10 of the Agreement.
The
Company further agrees that no Indemnified Person shall have any liability
to
the Company for or in connection with the Placement Agent's engagement under
the
Agreement, except for any Claim incurred by the Company solely as a direct
result of any Indemnified Person's gross negligence, bad faith or willful
misconduct.
The
Company further agrees that the Company will not, without the prior written
consent of the Placement Agent (which consent shall not be unreasonably withheld
or delayed), settle, compromise or consent to the entry of any judgment in
any
pending or threatened Claim in respect of which indemnification may be sought
hereunder (whether or not any Indemnified Person is an actual or potential
party
to such Claim), unless such settlement, compromise or consent includes a
legally
binding, unconditional and irrevocable release of each Indemnified Person
hereunder from any and all liability arising out of such Claim.
Promptly
upon receipt by an Indemnified Person of notice of any complaint or the
assertion or institution of any Claim with respect to which indemnification
is
being sought hereunder, such Indemnified Person shall notify the Company
in
writing of such complaint or of such assertion or institution, but failure
to so
notify the Company shall not relieve the Company from any obligation the
Company
may have hereunder, unless, and only to the extent that, such failure results
in
the forfeiture by the Company of substantial rights and defenses, and such
failure to so notify the Company will not in
any
event
relieve the Company from any other obligation or liability the Company may
have
to any Indemnified Person otherwise than under this Agreement. If the Company
so
elects, the Company will assume the defense of such Claim, including the
employment of counsel reasonably satisfactory to such Indemnified Person
and the
payment of the fees and expenses of such counsel. In the event, however,
that
if, in the opinion of counsel to the Indemnified Person (such counsel and
opinion being satisfactory to the Company and its counsel), that (i) there
would
be a conflict of interest if the Indemnified Person has counsel common to
the
Company or any other Indemnified Person or (ii) there may be legal defenses
available to it or other Indemnified Persons that are different from or in
addition to those available to the Company, then such Indemnified Person
may
employ its own separate counsel to represent or defend it in any such Claim,
and
the Company shall pay the reasonable fees and expenses of such counsel.
Notwithstanding anything herein to the contrary, if the Company fails timely
or
diligently to defend, contest, or otherwise protect against any Claim, the
relevant Indemnified Party shall have the right, but not the obligation,
to
defend, contest, compromise, settle, assert cross claims or counterclaims,
or
otherwise protect against the same, and shall be fully indemnified by the
Company therefor, including, but not limited to, for the reasonable fees
and
expenses of its counsel and all amounts paid as a result of such Claim or
the
compromise or settlement thereof. In any Claim in which the Company assumes
the
defense, the Indemnified Person shall have the right to participate in such
defense and to retain its own counsel therefor at its own expense.
The
Company agrees that if any indemnity sought by an Indemnified Person hereunder
is held by a court to be unavailable for any reason, then (whether or not
the
Placement Agent is the Indemnified Person) the Company and the Placement
Agent
shall contribute to the Claim for which such indemnity is held unavailable
in
such proportion as is appropriate to reflect the relative benefits to the
Company, on the one hand, and the Placement Agent, on the other, in connection
with the Placement Agent's engagement by the Company under the Agreement,
subject to the limitation that in no event shall the amount of the Placement
Agent's contribution to such Claim exceed the amount of fees actually received
by the Placement Agent from the Company pursuant to the Placement Agent's
engagement under the Agreement. The Company hereby agrees that the relative
benefits to the Company, on the one hand, and the Placement Agent, on the
other,
with respect to the Placement Agent's engagement under the Agreement shall
be
deemed to be in the same proportion as (a) the total value paid or proposed
to
be paid or received by the Company or the Company's shareholders as the case
may
be, pursuant to the transaction (whether or not consummated) for which the
Placement Agent is engaged to render services bears to (b) the fee paid or
proposed to be paid to the Placement Agent in connection with such
engagement.
The
Company’s indemnity, reimbursement and contribution obligations hereunder shall
be in addition to, and shall in no way limit or otherwise adversely affect
any
rights that any Indemnified Party may have at law or at equity.
Should
the Placement Agent, or any of its directors, officers, partners, shareholders,
agents or employees, be required or be requested by us to provide documentary
evidence or testimony in connection with any proceeding arising from or relating
to the Placement Agent's engagement under the Agreement the Company agrees
to
pay all reasonable expenses (including, but not limited to, reasonable fees
and
expenses of counsel) in complying therewith, payable in advance.
It
is
understood that, in connection with the Placement Agent's engagement under
the
Agreement, the Placement Agent may be engaged to act in one or more additional
capacities and that the terms of the original engagement or any such additional
engagement may be embodied in one or more separate written agreements. The
provisions of this Agreement shall apply to the original engagement and any
such
additional engagement and shall remain in full force and effect following
the
completion or termination of the Placement Agent's engagement(s).
