April 9, 2007
Exhibit
10.10
April
9,
2007
Xxxxxx
X’Xxxxx, CEO
Flexible
Solutions International, Inc.
000
Xxxxxxxxx Xxxxxx
Xxxxxxxx,
Xxxxxxx Xxxxxxxx, X0X 0X0
Xxxxxx
Re: Capstone
Investments, Inc Retainer Agreement
Dear
Xx.
X’Xxxxx:
This
letter agreement (this “Agreement”) will confirm the arrangements under which
CapStone Investments (“CapStone”) is authorized to act as the non-exclusive
investment banking agent (“Agent” or “Agency”) on behalf of Flexible Solutions
International, Inc., and its affiliates and subsidiaries (“FSI”). The terms of
this Agreement will expire at 5:00
p.m. on Friday, April 20, 2007,
unless
fully executed by duly authorized representatives of both parties.
Fees
As
compensation for the services of CapStone hereunder, FSI shall pay to CapStone
the following fees:
CapStone
will act as Placement Agent with respect to the proposed private placement
of
equity securities (the “Securities”) by FSI (the “Financing”), and as such
CapStone will receive five percent (5%) of the total cash received by FSI from
the sale of the Securities to Abacus Advisors/Xxxxxxx Xxxxxx only (the “Fees”)
to be paid at close of the transaction (the “Closing”). The Fees will be paid
according to the following wire transfer instructions:
| ABA Routing No.: | 122 000 496 | |
| Bank: |
Union Bank of California
0000 Xx Xxxxx Xxxxxxx Xxxxx, Xxxxx
000
Xxx Xxxxx, XX
00000
|
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| Account No.: | 4760000448 | |
| Account Name: | CapStone Investments | |
| Address: |
0000 Xx Xxxxx Xxxxxxx Xxxxx, Xxxxx
0000
Xxx
Xxxxx, XX 00000
|
RETENTION
FSI
hereby retains CapStone, and CapStone agrees to act, in accordance with the
provisions of this paragraph, as Agent in connection with investment banking
during the term of this Agreement
CapStone
acknowledges and agrees that FSI shall retain the sole and exclusive right
to
accept or reject investment advice offered by CapStone and any proposed sale
of
Securities and FSI shall not incur any liability (other than incurred
reimbursable expenses as described herein) to CapStone for such rejection.
FSI
understands that CapStone will be acting as a non-exclusive Agent of FSI in
connection with this Agreement and the offering and sale of any FSI Securities
and acknowledges and agrees that in connection therewith CapStone will use
its
“best
efforts”
to place
such Securities only with Abacus Advisors/Xxxxxxx Xxxxxx and no other firms
or
persons without express advance permission from FSI. FSI expressly acknowledges
and agrees that CapStone’s obligations hereunder are not on a firm commitment
basis and that the execution of this Agreement does not constitute a commitment
by CapStone to purchase Securities and does not ensure the successful placement
of Securities or any portion thereof.
ADDITIONAL
TERMS AND CONDITIONS
Term.
The term
of this Agreement is valid for three (3) months from its execution by both
parties.
If
FSI
closes the sale of Securities during the Term or within twelve (12) months
of
the termination of this Agreement to a third party with whom FSI had any
discussions during the Term as a result of an introduction by CapStone and
who
is included on a written list provided to FSI no later than ten (10) days
following the termination of this Agreement (the “Covered Investors”), then
CapStone shall be entitled to receive, at the Closing of such sale of
Securities, the Fee with respect to the Securities sold to such Covered
Investor; provided that CapStone will only be due a Fee if the introduction
resulting in the Fee has been approved in writing by Company prior to the
introduction.
Direction
at closing.
FSI
shall Wire the fee directly from an FSI account.
Information.
During
the course of the Term of this Agreement, FSI agrees to furnish CapStone with
such information about FSI as CapStone reasonably requests to help facilitate
its investment banking obligations (“Company Information”). FSI represents and
warrants to CapStone that all Company Information will be accurate and complete
in all material respects and will not contain any untrue statements of a
material fact or omit to state a material fact necessary to make the statements
contained therein, in light of the circumstances under which
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such
statements are made, not misleading, in each case at the time such information
is furnished. FSI agrees to advise CapStone during the period of the engagement
of all developments materially affecting FSI or the accuracy of the Company
Information previously furnished to CapStone or prospective purchasers of
Securities located by Agent. FSI acknowledges and confirms that CapStone (i)
will be relying solely on such information and other information available
from
generally recognized public sources in performing the services contemplated
hereunder, (ii) will not independently verify the accuracy or completeness
of
such information, (iii) does not assume responsibility for the accuracy or
completeness thereof, (iv) will make appropriate disclaimers consistent with
the
foregoing and (v) their affiliates may share with each other any information
related to FSI or FSI’s affiliates (including information relating to
creditworthiness) provided that such affiliates are bound by the Confidentiality
Agreement.
Other
Fees and Expenses.
FSI
shall be responsible for all actual, out-of-pocket third party fees, charges,
expenses and disbursements relating to this Agreement, including, without
limitation, all actual, out-of-pocket third party fees, charges, expenses and
disbursements in connection with (i) the preparation (including but not limited
to attorneys’ fees, accountants’ fees, and other related consultants’ fees),
printing, filing, distribution and mailing of any transaction documents and
any
supplement and amendment thereto and all other documents relating to any
offering of securities and the purchase, sale and delivery of any such
securities, including the cost of all copies thereof; (ii) the issuance, sale,
transfer and delivery of such securities, including any transfer of other taxes
payable thereon and the fees of any transfer agent or registrar; (iii) the
registration or qualification of such securities for offer and sale with the
SEC. (including, without limitation, all filing and registration fees and the
reasonable “blue sky” fees and disbursements;
Indemnification.
FSI
agrees to indemnify CapStone and its affiliates and each person in control
of
CapStone and its affiliates and their respective officers, directors, employees,
agents and representatives and their respective affiliates and control persons
(“Capstone Indemnified Parties”), from and against any loss, claim, damage,
liability, or third party action arising out of or based upon any untrue
statement of any material fact contained in the Company Information or the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein in the light of
the
circumstances under which they are made, not misleading; provided, however,
that
FSI shall not be liable in any such case to the extent that any such loss,
claim, damage, liability, or action arises out of, or is based upon, (i) an
untrue statement or alleged untrue statement or omission or alleged omission
made therein upon, and conformity with, information relating to any CapStone
Indemnified Party furnished to FSI by any CapStone Indemnified Party
specifically for the use in the preparation thereof or (ii) the negligent acts
of, or willful conduct by, any CapStone Indemnified Party. CapStone agrees
to
indemnify FSI and its affiliates and each person in control of FSI and its
affiliates and their respective officers, directors, employees, agents and
representatives and their respective affiliates and control persons (“FSI
Indemnified Parties”), from and against any loss, claim, damage, liability, or
third party action arising out of or based upon (i) an untrue statement or
alleged untrue statement or omission or alleged omission made therein upon,
and
conformity with, information relating to any CapStone Indemnified Party
furnished to FSI by any CapStone Indemnified Party specifically for the use
in
the preparation thereof or (ii) the negligent acts of, or willful conduct by,
any CapStone Indemnified Party.
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Other
Services.
FSI
acknowledges and agrees that CapStone and/or its affiliates may be requested
by
FSI to provide additional services with respect to FSI or other matters
contemplated hereby. Any such services will be set out in and governed by a
separate agreement(s) (containing terms relating, without limitation, to
services, fees and indemnification) in form and substance satisfactory to FSI
and CapStone (or any such affiliate). Nothing in this Agreement is intended
to
obligate or commit CapStone or any of its affiliates to provide any services
or
financing other than as set out herein.
No
Shareholder Rights.
FSI
acknowledges and agrees that CapStone has been retained only by FSI and that
FSI’s engagement of CapStone is not deemed to be on behalf of and is not
intended to confer rights upon any shareholder, owner or partner of FSI or
CapStone or any other person not a party hereto. Unless otherwise expressly
agreed, no person or entity other than FSI is authorized to rely upon FSI’s
engagement of CapStone or any statements, advice, opinions, or conduct by
CapStone.
Successors
and Assigns.
This
engagement agreement is binding on all successors and assigns. However, it
shall
not be assigned without the prior written consent of the other party. This
agreement shall be construed in accordance with and enforceable under the laws
of the State of California.
Governing
Law.
This
Agreement constitutes the entire agreement between us, and
supersedes all other prior agreements and understandings, other written and
oral, between the parties hereto with respect to the subject matter hereof
and
cannot be amended or otherwise modified except in writing executed by the
parties hereof.
Any
dispute arising from the interpretation, validity or performance of this
Agreement or any of its terms and provisions shall be submitted to arbitration
in San Diego County, California before JAMS/Endispute, Inc.
Miscellaneous.
This
Agreement may be executed in two or more counterparts, including electronically
transmitted counterparts, all of which together shall be considered a single
instrument. The term “affiliate” as used herein shall have the meaning ascribed
to such term in the rules and regulations promulgated under the Securities
Exchange Act of 1934, as amended.
*****************************
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We
are
delighted to accept this engagement and look forward to working with you on
this
assignment. Please confirm that the foregoing is in accordance with your
understanding by signing and returning to us the enclosed duplicate of this
letter.
Very
truly yours,
CapStone
Investments
By:
______________________________________
Xxxxxx
X.
Xxxxxxx, President
AGREED
AND ACCEPTED:
Flexible
Solutions International, Inc.
By:
______________________________________ Dated:
_______________________
Xxxxxx
X’Xxxxx, CEO
Flexible
Agree with CapStone 5-25-07
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