EXHIBIT 10.2
[LOGO]
Member of NASD, MSRB and SIPC
EMPIRE FINANCIAL GROUP, INC
00 Xxxx 00 Xxxxxx, 0xx Xxxxx
XX, XX X0000
000-329-7007
000-000-0000
December 2, 2006
Xx. Xxxxx Xxxxxxxxx
Chief Executive Officer/ President
Mediscience Technology Corporation
0000 Xxxxxxxxxx Xxx
Xxxxxx xxxx, XX 00000
Dear Xx. Xxxxx Xxxxxxxxx:
This letter (the "Agreement") constitutes the agreement between
Mediscience Technology Corporation (the "Company") and Empire Financial Group,
Inc. ("Empire") that Empire shall serve as the placement agent for the Company,
on a "best efforts" basis, in connection with the proposed offer and private
placement (the "Offering") by the Company of $2.0 million and is predicated on
successful completion of the doe diligence investigation by Empire.
A. Fees and Expenses. In connection with the Services described above, the
Company shall pay to Empire the following:
1. Placement Agent's Fee. As compensation for its services in connection
with the Private Placement, the Company agrees to pay Empire a nonrefundable
retainer fee of $10,000 ("Ten Thousand Dollars") in cash upon execution of this
letter agreement. The Company shall pay to Empire a cash placement fee equal to
twelve percent (12.0%) of the aggregate purchase price paid by each purchaser of
Securities that were placed in the Offering (the "Placement Agent's Fee"). The
Placement Agent's Fee xxxx be deducted from the gross proceeds of the Securities
sold at the Closing, The amount of the retainer tee previously paid to Empire
will be credited on a dollar for dollar basis toward the cash portion of the
placement fee.
2, Expenses. In addition to any fees payable to Empire hereunder and
regardless of whether an Offering is consummated, the Company hereby agrees to
reimburse Empire, within ten (10) days after
Written request therefore, all reasonable travel and other out-of-pocket
expenses incurred in connection with Empire's engagement, including the
reasonable fees and expenses of Empire's counsel but which shall he capped at
$5,000. The Company shall also be responsible for ordering up to ten (10) Lucite
deal tombstones and shall release a press release at the conclusion of the
transaction that shall be reviewed and approved by Empire.
3. Warrants: In addition to the Placement Agent's Fee, upon the closing of
the sale of securities in connection with the Offering, the Company shall issue
to the Placement Agent warrants to purchase shares of common stock of the
Company (the "Warrants") in an amount ten percent (100%) of the amount of
Securities issued or issuable by the Company in the Offering. The Warrants shall
be exercisable at 120% of the Offering Price or at the market price on the date
of signing this agreement, whichever is lower. The Warrants shall expire five
years from the date of issuance. The Warrants shall be in the same form,
including, without limitation, the same registration rights and anti-dilution
provisions, as the securities sold in the Offering; provided however, the
Warrants shall include a "net issuance" exercise feature.
B. No-Shop. Until the Offering contemplated hereby is completed, but no
later than 180 days from the date hereof (the "No-Shop Period"), the Company
agrees that it will not negotiate with any other person relating to a possible
public or private offering or placement of the Company's securities.
X. Xxxx and Termination of Engagement. Except as set form below, the term
(the Term") of Empire's engagement will begin on die date hereof and end on the
earlier of the consummation of due Offering or 20 days after receipt by cither
Party hereto of written notice of termination; provided that no such notice may
be given by the Company during the No Shop Period. Notwithstanding any such
expiration or termination, Paragraphs D through N shall survive and remain in
full force and effect and be binding on the parties hereto, in accordance with
their terms.
D. Fie Tail. Empire shall be entitled to a Placement Agent's Fee,
calculated in the manner provided in Paragraph A, with respect to any securities
purchased in any subsequent offering ("Subsequent Offering") by investors whom
Empire bad introduced to the Company during the Term if such Subsequent Offering
is consummated at any time within (i) the 24-month period following the
consummation of this Offering and (ii), if no Offering shall have been
consummated during the Term, the six month period following the expiration or
termination of this Agreement.
E. Future Transactions, If, at any time during the Tern, or within the
24-month period following consummation of the Offering during the Term, the
Company or any of its subsidiaries (i) disposes of or acquires business units or
acquires any of its outstanding securities or makes any exchange or tender offer
or enters into a merger, consolidation or other business combination or any
recapitalization, reorganization, restructuring or other similar transaction,
including, without limitation, an extraordinary dividend or distribution or a
spin-off or split-off (each, a "Transaction"), and the Company decides to retain
a financial advisor for such Transaction, Empire shall have the right to act as
one of the Company's financial advisors for any such Transaction; or (ii)
decides to finance or refinance any indebtedness using a manager or agent,
Empire (or any affiliate designated by Empire) shall have the right to act as a
manager, placement agent or lead agent with respect to such financing or
refinancing- or (iii) determines to raise funds by means of a public offering or
a Offering of equity or debt securities using an underwriter or placement agent,
Empire shall have the right to act as an underwriter, initial purchaser or
placement agent for such financing. In each case where Empire so serves, Empire
shall be entitled to at least one third of the total fees paid in connection
with the foregoing transactions. If Empire or its affiliates decides to accent
any such engagement, the agreement governing such engagement will
2
Contain, among other things, provisions for customary fees for Transactions of
similar size <
