March 19, 2010 Attention: Mr. Brian Ross Accelerize New Media Inc 12121 Wilshire Blvd., Suite 322 Los Angeles, CA 90025 Re.: Finder’s Agreement Dear Mr. Ross:
Exhibit 10.5
Xxxxx 00,
0000
Xxxxxxxxx:
Mr. Xxxxx Xxxx
00000
Xxxxxxxx Xxxx., Xxxxx 000
Xxx
Xxxxxxx, XX 00000
Re.: Finder’s
Agreement
Dear Xx.
Xxxx:
This is
to acknowledge and confirm the terms of our finder’s agreement, which is subject
to all of the terms and conditions stated in this letter.
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1.
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Services
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Beginning
and effective as of March 19, 2010 Accelerize New Media Inc. (the
“Company”)
hereby engages Sandgrain Securities, Inc. (“Sandgrain” or “Finder”) for a period
of thirty days (the “Term”) to act as a
non-exclusive finder of investors for equity (the “Securities”) to be
offered by the Company during the Term (the “Services”). In
connection with the foregoing, the Finder shall introduce the Company, upon its
written request, to prospective investors. Company and the
prospective investors will consummate one or more financing transactions (each,
a “Financing
Transaction”).
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2.
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Compensation
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In the
event the Company consummates a Financing Transaction involving equity
securities issued to an investor that was introduced to the Company within the
Term as a result of Finder’s efforts made during the Term, the Company shall pay
Finder the following fee (the “Finder’s
Fee”):
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(i)
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Cash Fee: Within one (1)
business day of the closing of a Financing Transaction (the “Closing”), the
Company shall pay Sandgrain a fee equal to seven percent (7%) of the
purchase price of Securities sold (the “Finder’s Fee”)
by wire. In the event of multiple Closings, the Finder’s fee will be paid
as the money is received by the
Company.
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Warrant: Upon the Closing (or each
Closing, as the case may be) of a transaction, the Company shall deliver to
Sandgrain (or Sandgrain’s designated nominee) warrants (the “Warrants”), for the
issuance of such number of the Securities that equals five percent (5%) of the
amount of the Securities sold at such Closing (or Closings). The Warrants shall
be assignable by the holder to any person, including an employee of Sandgrain.
The Warrants shall be exercisable for three (3) years from the date of grant
with an exercise price of sixty-five cents ($0.65). Additionally, all
securities issued hereunder to Sandgrain shall have identical demand
registration rights, co-sale rights and all other rights as given to investors
under the financing transaction.
Expenses. Upon the first Closing (regardless of
the purchase price of the securities sold), the Company shall, in addition to
the foregoing, pay Sandgrain a fee of up to $2500.00 for the expenses incurred
in connection with this agreement.
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3.
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Reliance on
Information Supplied
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In the
performance of the Services, Sandgrain (i) will use and rely on the accuracy and
completeness of the documents disclosed to the public by the Company pursuant to
the Securities Exchange Act of 1934, as amended, or otherwise (collectively,
“Public
Information”), (ii) is not responsible for, and has no obligation to
independently verify, the accuracy or completeness of any information furnished
by the Company to it or to any third person introduced by Sandgrain to the
Company in the course of performing the Services, or the Public Information,
(iii) has no obligation to undertake an independent evaluation, appraisal, or
physical inspection of any assets or liabilities of the Company, and (iv) will
assume that any financial forecasts furnished to, or discussed with, Sandgrain
by authorized representatives of the Company have been reasonably prepared and
reflect the best then currently available estimates and judgment of the
Company’s management.
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4.
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Covenants,
Representations and
Warranties
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a.
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The
Company will reasonably promptly furnish Sandgrain, from time to time,
such information concerning the Company, its business, financial
condition, plans, and projections as Sandgrain reasonably requests in
order to assist Sandgrain in the performance of the
Services.
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b.
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If
any event shall occur or condition exist as a result of which it is
necessary or advisable, in the opinion of the Company or Sandgrain, to
amend or supplement any information previously furnished by the Company in
order that the information does not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements contained therein, in the light of the circumstances under
which they were made, not misleading, the Company will promptly prepare
and furnish to Sandgrain and the public, if applicable, amendments or
supplements to the information previously
furnished.
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c.
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The
Company will advise Sandgrain reasonably promptly of (i) the occurrence of
any event or the existence of any condition known to the Company referred
to in paragraph (b) of this Section 4, (ii) such other information
concerning the business and financial condition of the Company as
Sandgrain may from time to time reasonably request, (iii) the receipt by
the Company of any communication from any regulatory authority concerning
the Company, and (iv) the commencement of any lawsuit, proceeding or
regulatory action to which the Company is a party or which might
materially affect the business or condition of the Company or the
performance by Sandgrain of the
Services.
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d.
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In
the event the Company shall enter into any Financing Transaction, it will
deliver, or cause to be delivered, to Sandgrain a copy of each agreement
(together with all exhibits and schedules attached thereto) that the
Company proposes to enter into regarding a Financing
Transaction.
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e.
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During
any period in which Sandgrain shall perform services hereunder, Sandgrain
(i) will keep, and cause its officers, directors, shareholders,
employees, agents and representatives to keep, all material non-public
information concerning the Company and any of its affiliates confidential,
(ii) shall not trade its stock in the Company based upon any material
non-public information or take any short position in the Company’s stock
or otherwise do anything that could have an adverse affect on the
Company’s stock, and (iii) conduct itself in such a manner to be
consistent with each exemption from registration under the Securities Act
of 1933 and state blue sky laws that the Company intends to rely on for
each Financing Transaction.
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f.
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The
Company hereby represents and warrants that the offering
documents do not and will not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading.
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g.
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The
Company hereby warrants and agrees to hold all information received from
Sandgrain in strict confidence and shall not (i) disclose any information
to third parties or (ii) use any information after the expiration of this
agreement or for any purpose other than the transaction contemplated by
this agreement.
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5.
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Announcement
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Upon
consummation of any Financing Transaction, Sandgrain may, with the Company’s
prior written approval, at Sandgrain’s expense, place an announcement in such
print and/or electronic publication media as it may choose (including website
posting), stating that it has acted as strategic and investment advisor to the
Company. If not violative of applicable law, the Company will include a
reference to Sandgrain as its finder in any press release or public announcement
with respect to the Financing Transaction.
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6.
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Notices
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All
communications hereunder shall be in writing and shall be mailed or delivered
(a) to the Company, at its offices at Accelerize New Media Inc, 00000 Xxxxxxxx
Xxxx., Xxxxx 000, Xxx Xxxxxxx, XX 00000, Attention: Mr. Xxxxx Xxxx, Chief
Executive Officer, and (b) to Sandgrain, at its branch office at 000 Xxx Xxxxxx,
Xxxxx 000, Xxxxxx Xxxx, XX 00000, facsimile: (000)-000-0000, Attn.: Xx. Xxxxxx
Xxxxx. The Company will give Sandgrain notice of, and an opportunity to attend,
periodic meetings with the Company’s investors.
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7.
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Indemnity
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The
Company shall indemnify Sandgrain and Sandgrain shall indemnify the Company in
accordance with Annex-
A attached hereto.
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8.
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Termination
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The
engagement of Sandgrain hereunder may be terminated at anytime by either the
Company or Sandgrain, upon ten days’ prior written notice thereof to the other
party. The provisions of sections 2 (Compensation), 7 (Indemnity Annex-A) and 9
(Miscellaneous) will survive any termination of this agreement.
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9.
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Miscellaneous
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a.
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Sandgrain
is acting as a finder and is not an expert on, and shall not render
opinions regarding, legal, accounting, regulatory or tax matters. The
Company shall consult with its other professional advisors concerning
these matters before undertaking any Financing
Transaction.
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b.
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No
waiver, amendment or other modification of this Agreement shall be
effective unless in writing and signed by each party to be bound. This
Agreement shall inure to the benefit of and be binding on the Company,
Sandgrain and their respective successors and assigns. This
Agreement constitutes the entire agreement between the Company and
Sandgrain with respect to the subject matter hereof and supersedes any and
all other prior or contemporaneous agreements, either oral or written,
between the Company and Sandgrain with respect to the subject matter
hereof.
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c.
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In
case any provision of this Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions of this Agreement shall hereunder not in any way be affected or
impaired thereby.
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d.
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The
Company has retained Sandgrain to act as an independent contractor, and
any duties of Sandgrain arising out of its engagement shall be owed solely
to the Company and to no other
party.
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e.
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f.
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Each
of Sandgrain and the Company waives all right to trial by jury in any
action, proceeding or counterclaim (whether based upon contract, tort or
otherwise) related to or arising out of this
Agreement.
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balance of this page intentionally left blank
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Please
confirm that the foregoing correctly sets forth our agreement by signing and
returning to Sandgrain the enclosed counterpart copy of this
Agreement.
We are
delighted to accept this engagement and look forward to working with
you.
| Very truly yours, | |||
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SANDGRAIN
SECURITIES, INC.
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By:
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/s/ Xxxxx Xxxxxxx | |
| Name: | Xxxxx Xxxxxxx | ||
| Title: | President | ||
Accepted
as of the date first written above
| By: |
/s/
Mr. Xxxxx Xxxx
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| Name: | Mr. Xxxxx Xxxx |
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| Title: | Chief Executive Officer |
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ANNEX-A
Either
party shall indemnify the other party and its affiliates and their respective
directors, officers, employees, representatives, agents and controlling persons
(Both parties and each such person being an “Indemnified Party”)
from and against any and all losses, claims, damages and liabilities, joint or
several, to which such Indemnified Party may become subject under any applicable
law, or otherwise, and related to, arising out of, or in connection with any
untrue statement or alleged untrue statement of a material fact contained in any
document furnished or made available by the party from and after March 10, 2010
(directly, through the party, or otherwise), or the omission or the alleged
omission to state therein a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, and will reimburse each Indemnified Party for all
reasonable expenses (including counsel fees and expenses) incurred in connection
with the investigation of, preparation for or defense of any pending or
threatened claim or any action or proceeding arising therefrom, whether or not
such Indemnified Party is a party and whether or not such claim, action or
proceeding is initiated or brought by or on behalf of the parties.
The
parties will not settle, compromise or consent to the entry of any judgment in
any pending or threatened claim, action or proceeding in respect of which
indemnification could be sought under this Annex A (whether or not the parties
or any other Indemnified Party is an actual or potential party to such claim,
action or proceeding), unless such settlement, compromise or consent includes an
unconditional release of each Indemnified Party from all liability arising out
of such claim, action or proceeding.
If either
party or any other Indemnified Party is requested or required to appear as a
witness in any action brought by or on behalf of or against the other party not
resulting from the acts/omissions of the other party, the parties will reimburse
the other party for all reasonable expenses incurred in connection with such
party’s appearing and preparing to appear as such a witness, including, without
limitation, the reasonable fees and disbursements of its legal
counsel.
Unless
expressly modified, the provisions of this Annex-A shall
continue to apply and shall remain in full force and effect regardless of any
modification or termination of this Agreement or the completion of Sandgrain’s
Services hereunder.
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