Exhibit (d)(1)(G)
KANDERS & COMPANY, INC.
0 Xxxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
_____________ __, 2000
The Xxxxxx Biomechanics Group, Inc.
000 Xxxxxxx Xxxx
Xxxx Xxxx, XX 00000
Dear Sirs:
We are pleased to set forth in this agreement (the "Agreement") the terms
of the retention of Kanders & Company, Inc. (the "Consultant") by The Xxxxxx
Biomechanics Group, Inc. and its affiliates and subsidiaries (collectively, the
"Company").
1. The Consultant will act as the non-exclusive consultant to the Company,
and will, subject to the provisions hereinafter set forth:
(a) Render general investment banking and financial advisory
services to the Company, including, but not limited to,
assisting in the development and structuring of a corporate
financing and acquisition strategy for the Company. The
Company and the Consultant will execute engagement letters or
letters of intent at the appropriate time in connection with
specific transactions for which the Consultant will be
entitled to receive compensation; and
(b) Any other matter as may be mutually agreed upon by the
Consultant and the Company.
In connection with the Consultant's activities on the Company's behalf,
the Consultant will familiarize itself with the business, operations, properties
and financial condition of the Company. Nothing contained in this Agreement
shall require the Consultant to render a fairness opinion to the Company.
2. If the Company requests that the Consultant assist the Company in any
debt or equity financing for the Company, or in any acquisition by, or
recapitalization of, the Company, in any form, including but not limited to any
merger, consolidation, stock or asset acquisition or divestiture, any such
further action by the Consultant will be subject to a separate agreement
containing provisions and terms to be mutually agreed upon. The Consultant's
compensation for any such services shall be separately identified in such other
agreement, and shall be in addition to the compensation set forth in paragraph 4
below.
3. In connection with the Consultant's activities on the Company's behalf,
the Company will cooperate with the Consultant and will furnish the Consultant
with all information and data concerning the Company which the Consultant
reasonably believes appropriate to its assignment (all such information so
furnished being the "Information") and will provide the
The Xxxxxx Biomechanics Group, Inc.
____________ __, 2000
Page 2
Consultant with access to the Company's officers, directors, employees,
independent accountants and legal counsel. The Company recognizes and confirms
that the Consultant (a) will use and rely primarily on the Information and on
information available from generally recognized public sources in performing the
services contemplated by this Agreement, without having independently verified
same, (b) does not assume responsibility for the accuracy or completeness of the
Information and such other information and (c) will not make an independent
appraisal of any of the Company's assets. The Information to be furnished by the
Company, when delivered, will be true and correct in all material respects and
will not contain any material misstatement of fact or omit to state any material
fact necessary to make the statements contained therein not misleading. The
Company will promptly notify the Consultant if it learns of any material
inaccuracy or misstatement in, or material omission from, any Information
theretofore delivered to the Consultant. The Consultant agrees to keep
confidential and not disclose, without the Company's prior written consent, any
Information delivered to the Consultant by the Company that the Company has
identified in writing as not publicly available and confidential for a period of
six months after termination of this Agreement.
4. As compensation for the services rendered by the Consultant hereunder,
during the term of this Agreement the Company shall pay the Consultant an annual
fee of $100,000 in installments of $8,333.33, payable in advance on the first
day of each calendar month; provided that such amount shall be accrued for the
first year of the term hereof, unless the Compensation Committee of the Board of
Directors determines that, after paying all amounts that have accrued hereunder,
the Company will have positive cash flow, in which event the Company shall pay
all such accrued amounts hereunder.
5. In addition to the fees described in paragraph 4 above, the Company
agrees to reimburse the Consultant, upon request from time to time, for
reasonable out-of-pocket expenses incurred (including, but not limited to,
travel and other costs, reasonable fees and disbursements of counsel, and of
other consultants retained by the Consultant).
6. Simultaneously with the execution and delivery of the Tender Offer
Agreement among the Company, [the Consultant,] and ______ (the "Tender Offer
Agreement"), the Company shall grant to the Consultant an option (the "Option")
to purchase 100,000 shares of common stock, par value $.02 per share, of the
Company at an exercise price of $1.525 per share, substantially in the form of
Exhibit A attached hereto.
7. (a) The Company agrees to the indemnification and other agreements set
forth in the Indemnification Agreement attached hereto, the provisions of which
are incorporated herein by reference and shall survive the termination of this
Agreement.
(b) The Company represents and warrants to the Consultant that (x)
the execution, delivery and performance of this Agreement by the Company have
been duly authorized by all requisite corporate action on the part of the
Company, including authorization hereof by the Board of Directors of the
Company, and (y) this Agreement has been duly executed and delivered by the
Company, and constitutes the legal, valid and binding obligation of the Company,
enforceable
The Xxxxxx Biomechanics Group, Inc.
____________ __, 2000
Page 3
in accordance with its terms, except to the extent that its enforcement is
limited by bankruptcy, insolvency, reorganization or other laws relating to or
affecting the enforcement of creditors' rights generally and by general
principles of equity.
(c) The Consultant represents and warrants to the Company that (x)
the execution, delivery and performance of this Agreement by the Consultant have
been duly authorized by all requisite corporate action on the part of the
Consultant, including authorization hereof by the Board of Directors of the
Consultant, and (y) this Agreement has been duly executed and delivered by the
Consultant, and constitutes the legal, valid and binding obligation of the
Consultant, enforceable in accordance with its terms, except to the extent that
its enforcement is limited by bankruptcy, insolvency, reorganization or other
laws relating to or affecting the enforcement of creditors' rights generally and
by general principles of equity.
8. This Agreement shall commence on the date hereof and continue for a
period of three years. Either party hereto may terminate this Agreement at any
time after two years from the date hereof upon three months prior written
notice, without liability or continuing obligation to you (except for our
confidentiality obligations) or to us (except for any compensation earned, or
expenses incurred, by us up to the date of termination) and except as set forth
in paragraphs 4, 5, 6 and 7. Upon termination of this Agreement, the Company
shall pay to the Consultant in one lump sum, payable within five days of such
termination, (i) all amounts due the Consultant for reimbursement of expenses
pursuant to Section 5 through the date of termination, and (ii) the full amount
of compensation due to Consultant pursuant to Section 4 from the date hereof
through the end of the term hereof (i.e. the third anniversary of the date
hereof), to the extent the same has not been paid to the Consultant as of such
termination date. In the event that this Agreement expires by its terms on the
third anniversary and is not renewed, then the Company shall pay to the
Consultant $100,000, and Consultant shall be subject to the provisions of
Section 9 hereof for a period of one (1) year from such date of expiration.
9. Restriction of Competition; Interference; and Non-Solicitation.
(a) As an inducement to the Company to enter into and perform its
obligations under this Agreement, the Consultant covenants and agrees that,
during the term hereof and for a period of one (1) year after the termination of
this Agreement for any reason, neither the Consultant nor its affiliates will,
directly or indirectly, for their account or on behalf of any other Person (as
defined in Section 9(b) below) or as an employer, employee, consultant, manager,
agent broker, contractor, stockholder, director or officer of a corporation,
investor, owner, lender, partner, joint venturer, licensor, licensee, sales
representative, distributor, or otherwise:
(i) Solicit or engage in any business that engages in the
business of the Company (each, a "Competitive Business").
(ii) Directly or indirectly for their own account or the
benefit of others solicit, hire or retain any employee of the Company or its
affiliates or persuade or entice any
The Xxxxxx Biomechanics Group, Inc.
____________ __, 2000
Page 4
employee of the Company or its affiliates to leave the employ of the Company or
its affiliates.
(iii) Molest or interfere with the goodwill and relationship
with any of the customers or suppliers of the Company or its affiliates.
(iv) Persuade, accept, induce or solicit any of the customers,
suppliers or accounts of the Company or its affiliates, now existing or
hereafter obtained, to engage anyone, other than the Company or its affiliates,
to design, manufacture or market foot and gait- related biomechanical products
for such customers, suppliers or accounts.
(v) Invest in, lend money or give financial support to any
Competitive Business other than any investments or other interests that comprise
less than a 5% ownership of a public company, or any investments or other
interests which are passive investments, or in which the investment decision is
made by a third party.
(b) The provisions of Section 9(a) shall not be deemed to preclude
the Consultant from directly acquiring or holding, solely for investment,
securities of any corporation or entity some of the activities of which
constitute a Competitive Business so long as such securities do not, in the
aggregate, constitute more than five percent (5%) of any class or series of
outstanding securities of such corporation or entity. For the purpose of this
Agreement, "Person" shall mean any individual, entity or group within meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended.
10. This Agreement will be governed by, and construed in accordance with,
the laws of the State of New York applicable to agreements made and to be fully
performed therein. The Consultant and the Company agree to submit to the
jurisdiction of the Federal and New York State Courts located in the County of
Xxx Xxxx, Xxxxx xx Xxx Xxxx, Xxxxxx Xxxxxx of America for the purpose of
resolving any disputes among them relating to this Agreement.
11. The benefits of this Agreement shall inure to the parties hereto and
their respective successors and assigns, and the obligations and liabilities
assumed in this Agreement by the parties hereto shall be binding upon their
respective successors and assigns.
12. For the convenience of the parties hereto, any number of counterparts
of this Agreement may be executed by the parties hereto. Each such counterpart
shall be, and shall be deemed to be, an original instrument, but all such
counterparts taken together shall constitute one and the same Agreement. This
Agreement may not be modified or amended except in writing signed by the parties
hereto.
The Xxxxxx Biomechanics Group, Inc.
____________ __, 2000
Page 5
If the foregoing correctly sets forth our Agreement, please sign the
enclosed copy of this letter in the space provided and return it to us.
Very truly yours,
KANDERS & COMPANY, INC.
By:
--------------------------------------
Xxxxxx X. Xxxxxxx
President
AGREED TO AND ACCEPTED:
The Xxxxxx Biomechanics Group, Inc. hereby accepts
the terms and provisions of, and agrees to be bound by
the terms and provisions of the foregoing letter, as of
this ___th day of ___________, 2000.
THE XXXXXX BIOMECHANICS GROUP, INC.
By:
---------------------------------------
Name:
Title:
