Exhibit 4.5
PRIVATE AND CONFIDENTIAL
| Xxxxx Xxxxxxx |
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January 29, 2003 |
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| Chairman and CEO | |
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| Intasys Corporation | |
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| 000 Xx. Xxxxxxx Xxxxxx Xxxx | |
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| 8th Floor | |
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| Montreal, Quebec H2Y 1S1 | |
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Dear Xx. Xxxxxxx:
We are pleased to propose that
Intasys Corporation (“Intasys” or the “Company”) retain Maxim Group
LLC (“Maxim”), on a non-exclusive basis, as its investment banker, strategic
advisor and financial advisor. The principal elements of the agreement
(“Agreement”) between Maxim and the Company are:
| 1. |
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Services to be rendered: The services that Maxim will render to the Company under
the terms of this Agreement will include the following: |
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a) |
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Maxim
will provide the following strategic advisory services (“Advisory
Services”): |
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i) |
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advise
Intasys with respect to its strategic planning process and business plans
including an analysis of markets, products, positioning, financial models,
organization and staffing, potential strategic alliances, capital
requirements, valuation and funding. To prepare for this advisory
function, Xxxxx will perform a due diligence review of Intasys; |
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ii) |
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work
closely with Intasys’s management team to develop a set of long and
short-term goals with special focus on enhancing corporate and shareholder
value. This will also include assisting Intasys in completing a “gap
analysis,” i.e., helping Intasys determine key business developments
and actions, including review of financing requirements and Intasys’s
capital structure, intended to help enhance shareholder value and Intasys’s
exposure to the investment community and; |
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iii) |
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review
the Company’s presentation and marketing materials and other
materials used to present the Company to the investment community. |
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b) |
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Maxim
will help Intasys develop and evaluate financing or capital raising
alternatives including public and private issues of equity or debt, as
appropriate from time to time (“Banking Services”). |
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i) |
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Public
Offerings: In the event of a public offering, Xxxxx will have the right of
first refusal to act as lead or co-underwriter. Xxxxx will work with the
Company to manage the process of identifying, evaluating and selecting any
other underwriters. Xxxxx will prepare a comprehensive letter of intent
for the proposed transaction that will be provided to Intasys and will
supplement the terms of this Agreement. If Xxxxx is not selected as the
lead manager in a public offering, Intasys will use its best efforts to
ensure that Xxxxx receives at least 50% of the share allocation and 50% of
the total underwriting fees. |
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ii) |
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Private
Placements: Xxxxx will have the right of first refusal to act as placement
agent for any private placement. Xxxxx will prepare a comprehensive letter
of intent for the proposed transaction that will be provided to Intasys
and will supplement the terms of this Agreement. |
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c) |
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Maxim
will provide Intasys with merger and acquisition services (the “M&A
Services”). Xxxxx will assist the Company in determining acquisition
or strategic partnering strategies and tactics from time to time, as
appropriate. Xxxxx will advise and assist Intasys in identifying,
evaluating, negotiating and structuring acquisitions, or strategic
investments or partnerships which may be accomplished through a purchase
or sale of all or a portion of the stock or assets, a merger or reverse
merger, joint venture, licensing or marketing agreement or arrangement or
other business combination or arrangement (“Transaction”) with
any entity (“Candidate”). A strategic investment will include
any investment or exchange of cash, equity, warrants, assets or debt as
part of a business relationship with a third party, or any investment made
directly by a third party in the Company subject to a term sheet or
agreement not marketed or syndicated beyond a specific investor. |
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d) |
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If
requested by Intasys, Xxxxx will communicate its willingness to provide an
opinion of fairness (a “Fairness Opinion”) of a particular
Transaction to the Company, and if Maxim determines that it is able to
provide such a Fairness Opinion, it will allow it to be used in connection
with materials filed or submitted to the Securities and Exchange
Commission, or included in information mailed to shareholders of Intasys
in connection with each transaction. |
| 2. |
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Compensation
and Expenses. |
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a) |
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As
compensation for providing the Advisory Services hereunder, Intasys will pay
Maxim a retainer of $25,000, payable as follows: $15,000 upon execution of
this Agreement and $10,000 on the thirtieth day after the execution of the
Agreement. Beginning on the thirtieth day following the execution of the
Agreement Intasys will pay to Maxim an additional fee of $5,000 at the
beginning of each subsequent month that the agreement is in force. |
266
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b) |
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Upon
execution of this Agreement, Intasys will grant Maxim a warrant (“Advisory
Warrant”) representing 25,000 shares of the Company’s common
stock with an exercise price of $2.15. The Advisory Warrant will contain
provisions for, among other things, change of control, anti-dilution,
registration rights and net issuance, and will expire on June 30, 2006.
Intasys will issue to Maxim 8,000 additional Advisory Warrants monthly
during the term of the Agreement beginning on the thirtieth day following
the execution of the agreement. |
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c) |
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Terms
and fees for Banking Services performed under section 1(b) or provision of
a Fairness Opinion under 1(d) will be separately proposed by Xxxxx with
respect to each transaction when and if services are provided. |
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d) |
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For
any Transaction completed by the Company with a Candidate Intasys shall pay
Maxim a fee (“Success Fee”) upon closing equal to the sum of 2
½% of the aggregate transaction value, provided that Maxim either
introduces and/or performs specific services for the Transaction. The
minimum Success Fee for any Transaction in this section shall be $200,000.
Any Transactions currently being negotiated by the Company prior to the
signing of this Agreement will not be subject to a Success Fee, with the
exception of Net Creations, which was introduced by Xxxxx. The aggregate
transaction value shall include the sum of cash and the fair market value
at the time of the closing of a Transaction of equity securities;
warrants; contingent payments; deferred payments; non-compete agreements;
liabilities assumed, acquired, retired or defeased (other than normal
working capital liabilities); the face value of any debt securities issued
in such a Transaction; the fair market value of any licensing, marketing
or other business agreements or arrangements; and any other valuable
consideration issued in connection with a Transaction. |
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e) |
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The
Company will reimburse Maxim in a timely manner for any reasonable
out-of-pocket expenses relating to activities under this Agreement. Any
legal or other expenses must be pre-approved by the Company. |
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f) |
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In
no case will any fee obligations of the Company to any other financial
advisor or any other person in connection with this transaction reduce the
fees owed by the Company to Maxim under this Agreement. |
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g) |
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Xxxxx
and the Company agree to establish an escrow agreement as soon as
practicable to govern the flow of all Transaction related fees. |
| 3. |
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Term of Agreement. The term of this agreement is indefinite. However the
Company or Maxim may terminate it upon 30 days written notice. If such a
notice is sent by the Company, the monetary consideration will be payable
by the Company for the ensuing five months; however, the warrant
consideration will cease after the 30 days written notice. If Xxxxx sends
such a notice, both the monetary and warrant consideration will cease
immediately. Any future obligation that could be reasonably expected
to survive this Agreement will survive termination of this Agreement. Specific
surviving conditions will include, but not be limited to: (i)
payment of Success Fees earned under section 2(d) during the Term and for
Transactions considered during the Term and completed within 18 months of
the termination of this Agreement, and (ii) Section 4, Indemnity. |
267
| 4. |
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Indemnity.
The Company agrees to indemnify and hold harmless Maxim, including any
affiliated companies, and their respective officers, directors, controlling
persons and employees and any persons retained in connection with a
proposed financing (whether or not consummated) (the “Indemnitees”),
from and against all claims, damages, losses, liabilities and expenses as
the same are incurred (including any legal or other expenses incurred in
connection with investigating or defending against any such loss, claim,
damage or liability or any action in respect thereof), related to or
arising out of its activities hereunder. Notwithstanding the foregoing,
the Company shall not be liable for indemnity under this Agreement in
respect of any loss, claim, damage, liability or expense arising from Xxxxx’s
misconduct in performing the services described above. This provision
shall survive any termination of Xxxxx’s engagement as well as the
consummation or abandonment of any Transaction, placement or offering.
Intasys agrees that any and all decisions, actions and results with
regards to Intasys’s operating, financial and other business plans
are the sole responsibility of Intasys’s management, and that Xxxxx’s
engagement will in no way expose Xxxxx to any liability, including but not
limited to, liability for any financing, operating, financial, merger,
acquisition, managerial, or other results achieved by the Company, as well
as the implementation of, or the results achieved by, strategies or
business plans on which Xxxxx has provided review or advice. |
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a) |
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It
is understood by Maxim and the Company that the Company’s ability to
raise capital will be affected by various factors at the time of a
proposed offering, including but not limited to, stock market conditions,
competitive positioning of Intasys’s products, achieving business
plan goals that have been mutually agreed upon by Maxim and the Company,
short- and long-term business prospects, the plans and performance of the
management team and the capital structure of the Company. In the event
that Xxxxx does not deem itself able to act as a manager for a proposed
placement or offering, subject to Xxxxx’s sole reasonable discretion,
it will advise the Company on an appropriate course of action. |
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b) |
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In
performing its M&A Services hereunder, Xxxxx may rely entirely on
publicly available information and such other information as may be
furnished to Maxim by the Company or a Candidate, and has not and does not
assume any responsibility for independent verification of such information
or independent appraisal or valuation of assets. |
| 6. |
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Entire Agreement and Governing Law. This Agreement may not be amended or modified
except in writing, and shall be governed by and construed in accordance
with the laws of the State of New York. |
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If the foregoing correctly sets forth
your understanding, please so indicate by signing and returning to us the enclosed copy of
this letter along with a check for $15,000 representing the first month’s retainer.
We look forward to working with you on these important projects.
Sincerely,
Xxxxxxx Xxxxxx
Managing Director
Maxim Group, LLC.
| By: s/s Xxxxxxx
Xxxxxx |
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Date: January 29, 2003 |
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| Xxxxxxx Xxxxxx | |
| Managing Director | |
Intasys Corporation
| By: s/s Xxxxx Xxxxxxx
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Date: January 29, 2003 |
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| Xxxxx Xxxxxxx | |
| Chairman | |
269
PRIVATE AND CONFIDENTIAL
May 5, 2003
Xxxxx Xxxxxxx
Chairman and CEO
Intasys Corporation
000 Xx. Xxxxxxx Xxxxxx Xxxx, 0xx Xxxxx
Xxxxxxxx, Xxxxxx X0X 0X0
RE: Amendment to the Agreement
executed and dated on January 29, 2003
Dear Xx. Xxxxxxx:
This document will serve as an amendment
to the Advisory Agreement dated January 29, 2003 between Intasys Corporation and Maxim
Group, LLC. The Success Fee described in section 2(d), Compensation and Expenses, is to be
amended to reflect a 1% increase in the fees (i.e. 2½% to 3½%) for the
transaction currently being contemplated with Opt In Inc. Xxxxxxx Xxxx and Xxxxx
Xxxxxxxxxx introduced this transaction to Maxim. In case the minimum fee is charged, the
minimum fee shall be increased by an amount equal to 1% of the aggregate transaction value
in order to compensate Messrs. Gold and Xxxxxxxxxx. This amendment will be in effect for
only this specific transaction with Opt In Inc. brought by Messrs. Xxxx and Xxxxxxxxxx.
Sincerely,
Xxxxxxx Xxxxxx
Managing Director
Maxim Group, LLC.
| By: s/s Xxxxxxx
Xxxxxx |
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Date: January 29, 2003 |
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| Xxxxxxx Xxxxxx | |
| Managing Director | |
Intasys Corporation
| By: s/s Xxxxx Xxxxxxx
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Date: January 29, 2003 |
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| Xxxxx Xxxxxxx | |
| Chairman | |
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