EXHIBIT 10(n)
May 20, 1997
Xx. Xxxxxxx Xxxxx, President
Chief Executive Officer
Communications World International, Inc.
0000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Dear Xx. Xxxxx:
THIS AGREEMENT (the "AGREEMENT") effective May 20, 1997 between
Communications World International, Inc. ("CWI") and X.X. Xxxxxxxx & Co., Inc.
("XXXXXXXX").
In consideration of the mutual covenants contained herein and intending to
be legally bound thereby, CWI and XXXXXXXX hereby agree as follows:
1. XXXXXXXX will perform investment banking services for CWI on the terms
set forth below for a period of five years from the date hereof. Such
services will be performed on a best efforts basis and will include,
without limitation, assistance to CWI in mergers, acquisitions and
internal capital structuring and the placement of new debt and equity
issues of CWI, all with the objective of accomplishing CWI's business
and financial goals. In each instance, XXXXXXXX shall endeavor,
subject to market conditions, to assist CWI identifying corporate
candidates for mergers and acquisitions and sources of private and
institutional funds; to provide planning, structuring, strategic and
other advisory services to CWI; and to assist in negotiations on
behalf of CWI. In the event that XXXXXXXX serves as an underwriter of
a public offering of CWI's securities completed within one year from
the date hereof, CWI will xxxxx Xxxxxxxx a right of first refusal for
a period of two years thereafter to act as underwriter for public
offerings of CWI's securities. In each instance, XXXXXXXX will render
such services as to which CWI and XXXXXXXX mutually agree and
XXXXXXXX will exert its best efforts to accomplish the goals agreed to
by XXXXXXXX and CWI.
2. In connection with the performance of this AGREEMENT, XXXXXXXX and CWI
shall comply with all applicable laws and regulations, including,
without limitation, those of the National Association of Securities
Dealers, Inc. and the Securities and Exchange Commission.
3. In consideration of the services previously rendered and to be
rendered by XXXXXXXX hereunder, XXXXXXXX is hereby granted Warrants to
purchase, at a price of $1.20 per share, a total of 175,000 shares of
Common Stock of CWI, and piggy back registration rights as set forth
in paragraph 5 below. Subject to vesting, the Warrants ("XXXXXXXX
Warrants") may be exercised at any time from May 20, 1997 to and
including May 20, 2002. The XXXXXXXX Warrants shall vest and become
irrevocable as follows: 75,000 Warrants upon the signing of this
AGREEMENT, 50,000 Warrants 180 days after the signing of this
AGREEMENT, and an additional 50,000 Warrants 365 days after the
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signing of this AGREEMENT. Provided that no Warrants may be exercised
until CWI shareholders approve an increase to the number of authorized
shares to a minimum of 3,000,000 shares.
4. If CWI should, at any time, or from time to time hereafter, effect a
stock split, a reverse stock split, or a recapitalization, the terms
of the XXXXXXXX Warrants shall be proportionately adjusted to prevent
the dilution or enlargement of the rights of the holders.
5. If CWI during the period from May 20, 1997 to May 20, 2002, files a
Registration Statement covering the sale of any of CWI's common stock,
then CWI, on each such occasion, at the request of the holders of at
least 51% of the shares and warrants constituting the XXXXXXXX EQUITY,
shall include in any such Registration Statement, at CWI's expense,
the XXXXXXXX SHARES, provided that, if the sale of securities by CWI
is being made through an underwriter and the underwriter objects to
inclusion of the XXXXXXXX SHARES in the Registration Statement, the
XXXXXXXX SHARES shall not be so included in the Registration Statement
or in any registration statement filed within 90 days after the
effective date of the underwritten Registration Statement.
6. The obligation of CWI to register the XXXXXXXX SHARES, including the
shares issuable upon exercise of the XXXXXXXX Warrants, pursuant to
the demand or the piggy back registration rights set forth in
paragraph 5, above, shall be without regard to whether the XXXXXXXX
Warrants have been or will be exercised.
7. CWI agrees that, for a period of two (2) years from the date of this
AGREEMENT, CWI will not utilize the registration exemption set forth
in Regulation S under the ACT with a holding period of less than 1
year, nor issue any security under an S-8 to any Financial Consultant
without the consent of XXXXXXXX, which consent will not be
unreasonably withheld.
8. This AGREEMENT constitutes the entire Warrant Agreement between the
parties and when a copy hereof is presented to CWI's transfer agent,
together with a certified check in the proper amount and a request
that all or part of the XXXXXXXX Warrant be exercised, the
certificates for the appropriate number of shares of Common Stock
shall be promptly issued.
9. Upon the execution of this AGREEMENT, CWI shall include in their next
annual report and filings the highlights and terms of this investment
banking AGREEMENT.
10. Upon the signing of this AGREEMENT, CWI shall pay XXXXXXXX $5,000.00
as a non-accountable and non-refundable expense allowance for due
diligence and general compliance review. XXXXXXXX shall be entitled
to additional compensation, to be negotiated between XXXXXXXX and CWI,
arising out of any transactions that are proposed or executed by
XXXXXXXX and consummated by CWI, or are executed by XXXXXXXX at CWI's
request, during the term of this AGREEMENT to the extent that such
compensation is normal and ordinary for such transactions. In
addition, XXXXXXXX shall be reimbursed by CWI for any reasonable out-
of-pocket expenses that XXXXXXXX may incur in connection with
rendering any service to or on behalf of XXXXXXXX that is approved, in
writing, in advance by CWI's Chief Executive Officer.
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11. CWI agrees to indemnify and hold XXXXXXXX and its directors, officers
and employees harmless from and against any and all losses, claims,
damages, liabilities, costs or expenses arising out of any action or
cause of action brought against XXXXXXXX in connection with its
rendering services under this AGREEMENT except for any losses, claims,
damages, liabilities, costs or expenses resulting from any violation
by XXXXXXXX of applicable laws and regulations including, without
limitation, those of the National Association of Securities Dealers,
Inc. and the Securities and Exchange Commission or any state
securities commission or from any act of XXXXXXXX involving willful
misconduct and except that CWI shall not be liable for any amount paid
in settlement of any claim that is settled without its prior written
consent.
12. XXXXXXXX agrees to indemnify and hold CWI and its directors, officers
and employees harmless from and against any and all losses, claims,
damages, liabilities, costs or expenses resulting from any violation
by XXXXXXXX of applicable laws and regulations including, without
limitation, those of the National Association of Securities Dealers,
Inc., the Securities and Exchange Commission and any state securities
commission or from any act of XXXXXXXX involving willful misconduct.
13. Within 90 days of the date of this AGREEMENT, a representative of
XXXXXXXX will visit the corporate headquarters of CWI. CWI will
submit to XXXXXXXX a current business plan setting forth how CWI plans
to proceed over the next two (2) years.
14. Nothing contained in this AGREEMENT shall be construed to constitute
XXXXXXXX as a partner, employee, or agent of CWI; nor shall either
party have any authority to bind the other in any respect, it being
intended that XXXXXXXX is, and shall remain an independent contractor.
15. This AGREEMENT may not be assigned by either party hereto, shall be
interpreted in accordance with the laws of the State of New Jersey,
and shall be binding upon the successors of the parties. Either party
may terminate this investment banking contract at any time, however,
legally vested Warrants will remain with XXXXXXXX.
16. If any paragraph, sentence, clause or phrase of this AGREEMENT is for
any reason declared to be illegal, invalid, unconstitutional, void or
unenforceable, all other paragraphs, sentences, clauses or phrases
hereof not so held shall be and remain in full force and effect.
17. None of the terms of this AGREEMENT shall be deemed to be waived or
modified except by an express agreement in writing signed by the party
against whom enforcement of such waiver or modification is sought.
The failure of either party at any time to require performance by the
other party of any provision hereof shall, in no way, affect the full
right to require such performance at any time thereafter. Nor shall
the waiver by either party of a breach of any provision hereof be
taken or held to be a waiver of any succeeding breach of such
provision or as a waiver of the provision itself.
18. Any dispute, claim or controversy arising out of or relating to this
AGREEMENT, or the breach thereof, shall be settled by arbitration in
Jersey City, New Jersey, in accordance with the Commercial Arbitration
Rules of the American Arbitration Association. The parties hereto
agree that they will abide by and perform any award rendered by the
arbitrator(s) and that judgement upon any such award may be entered in
any Court, state or federal, having jurisdiction over the party
against whom the judgement is being
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entered. Any arbitration demand, summons, complaint, other process,
notice of motion, or other application to an arbitration panel, Court
or Judge, and any arbitration award or judgement may be served upon
any party hereto by registered or certified mail, or by personal
service, provided a reasonable time for appearance or answer is
allowed.
19. For purposes of compliance with laws pertaining to potential inside
information being distributed unauthorized to anyone, all
communications regarding CWI's confidential information should only be
directed to Xxxxxx X. Xxxxxxxx, Chairman, Xxxxxxx Xxxxxxxxx, President
or Xxxxx Xxxxxxxxxxx, Senior Vice President, Compliance. If
information is being faxed, our confidential compliance fax number is
(000) 000-0000 for communications use.
IN WITNESS WHEREOF, the parties hereto have executed this AGREEMENT as of
the day and year set forth above.
X.X. XXXXXXXX & CO., INC. COMMUNICATIONS WORLD INTERNATIONAL, INC.
By:____________________________ By:_________________________________
Xxxxxxx Xxxxxxxxx Xxxxxxx Xxxxx, President
President Chief Executive Officer
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