Exhibit 99e.doc
INTREPID TECHNOLOGY & RESOURCES, INC.
PLACEMENT AGENT AGREEMENT
Dated as of: October __, 2004
Newbridge Securities Corporation
0000 Xxxxxxx Xxxxx Xxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Ladies and Gentlemen:
The undersigned, Intrepid Technology & Resources, Inc., an Idaho corporation
(the "Company"), hereby agrees with Newbridge Securities Corporation (the
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"Placement Agent") and Cornell Capital Partners, LP, a Delaware Limited
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Partnership (the "Investor"), as follows:
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Offering. The Company hereby engages the Placement Agent to act as its
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exclusive placement agent in connection with the Standby Equity Distribution
Agreement dated the date hereof (the "Standby Equity Distribution Agreement"),
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pursuant to which the Company shall issue and sell to the Investor, from time to
time, and the Investor shall purchase from the Company (the "Offering") up to
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Twenty Five Million U.S. Dollars ($25,000,000) of the Company's common stock
(the "Commitment Amount"), par value US$0.005 per share (the "Common Stock"), at
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price per share equal to the Purchase Price, as that term is defined in the
Standby Equity Distribution Agreement. The Placement Agent services shall
consist of reviewing the terms of the Standby Equity Distribution Agreement and
advising the Company with respect to those terms.
All capitalized terms used herein and not otherwise defined herein shall have
the same meaning ascribed to them as in the Standby Equity Distribution
Agreement. The Investor will be granted certain registration rights with
respect to the Common Stock as more fully set forth in the Registration Rights
Agreement between the Company and the Investor dated the date hereof (the
"Registration Rights Agreement"). The documents to be executed and delivered in
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connection with the Offering, including, but not limited, to the Company's
latest Quarterly Report on Form 10-QSB as filed with the United States
Securities and Exchange Commission, this Agreement, the Standby Equity
Distribution Agreement, the Registration Rights Agreement, and the Escrow
Agreement dated the date hereof (the "Escrow Agreement"), are referred to
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sometimes hereinafter collectively as the "Offering Materials." The Company's
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Common Stock purchased by the Investor hereunder or to be issued in connection
with the conversion of any debentures are sometimes referred to hereinafter as
the "Securities." The Placement Agent shall not be obligated to sell any
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Securities.
Compensation.
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(ee) Upon the execution of this Agreement, the Company shall
issue to the Placement Agent or its designee shares of the Company's Common
Stock in an amount equal to Ten Thousand U.S. Dollars (US$10,000) divided by the
closing Bid Price of the Company's Common Stock, as quoted by Bloomberg, LP, on
the date hereof (the "Placement Agent's Shares"). The Placement Agent shall be
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entitled to "piggy-back" registration rights, which shall
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be triggered upon registration of any shares of Common Stock by the Investor
with respect to the Placement Agent's Shares pursuant to the Registration Rights
Agreement dated the date hereof.
Representations, Warranties and Covenants of the Placement Agent.
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(ff) The Placement Agent represents, warrants and covenants as
follows:
The Placement Agent has the necessary power to enter into this Agreement and to
consummate the transactions contemplated hereby.
The execution and delivery by the Placement Agent of this Agreement and the
consummation of the transactions contemplated herein will not result in any
violation of, or be in conflict with, or constitute a default under, any
agreement or instrument to which the Placement Agent is a party or by which the
Placement Agent or its properties are bound, or any judgment, decree, order or,
to the Placement Agent's knowledge, any statute, rule or regulation applicable
to the Placement Agent. This Agreement when executed and delivered by the
Placement Agent, will constitute the legal, valid and binding obligations of the
Placement Agent, enforceable in accordance with their respective terms, except
to the extent that (a) the enforceability hereof or thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws from time to
time in effect and affecting the rights of creditors generally, (b) the
enforceability hereof or thereof is subject to general principles of equity, or
(c) the indemnification provisions hereof or thereof may be held to be in
violation of public policy.
Upon receipt and execution of this Agreement, the Placement Agent will promptly
forward copies of this Agreement to the Company or its counsel and the Investor
or its counsel.
The Placement Agent will not intentionally take any action that it reasonably
believes would cause the Offering to violate the provisions of the Securities
Act of 1933, as amended (the "1933 Act"), the Securities Exchange Act of 1934
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(the "1934 Act"), the respective rules and regulations promulgated thereunder
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(the "Rules and Regulations") or applicable "Blue Sky" laws of any state or
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jurisdiction.
The Placement Agent is a member of the National Association of Securities
Dealers, Inc., and is a broker-dealer registered as such under the 1934 Act and
under the securities laws of the states in which the Securities will be offered
or sold by the Placement Agent unless an exemption for such state registration
is available to the Placement Agent. The Placement Agent is in material
compliance with the rules and regulations applicable to the Placement Agent
generally and applicable to the Placement Agent's participation in the Offering.
Representations and Warranties of the Company.
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(gg) The Company represents and warrants as follows:
The execution, delivery and performance of each of this Agreement, the Standby
Equity Distribution Agreement, the Escrow Agreement, and the Registration Rights
Agreement has been or will be duly and validly authorized by the Company and is,
or with respect to this Agreement, the Standby Equity Distribution Agreement,
the Escrow Agreement, and the Registration Rights Agreement, will be a valid and
binding agreement of the Company, enforceable in accordance with its respective
terms, except to the extent that (a) the enforceability hereof or thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
from time to time in effect and affecting the rights of creditors generally, (b)
the enforceability hereof or thereof is subject to general principles of equity
or (c) the indemnification provisions hereof or thereof may be held to be in
violation of public policy. The Securities to be issued pursuant to the
transactions contemplated by this Agreement and the Standby Equity Distribution
Agreement have been duly authorized and, when issued and paid for in accordance
with this Agreement, the Standby Equity Distribution Agreement and the
certificates/instruments representing such Securities, will be valid and binding
obligations of the Company, enforceable in accordance with their respective
terms, except to the extent that (1) the enforceability thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or similar laws from time
to time in effect and affecting the rights of creditors generally, and (2) the
enforceability thereof is subject to general principles of equity. All
corporate action required to be taken for the authorization, issuance and sale
of the Securities has been duly and validly taken by the Company.
The Company has a duly authorized, issued and outstanding capitalization as set
forth herein and in the Standby Equity Distribution Agreement. The Company is
not a party to or bound by any instrument, agreement or other arrangement
providing for it to issue any capital stock, rights, warrants, options or other
securities, except for this Agreement, the agreements described herein and as
described in the Standby Equity Distribution Agreement, dated the date hereof
and the agreements described therein. All issued and outstanding securities of
the Company, have been duly authorized and validly issued and are fully paid and
non-assessable; the holders thereof have no rights of
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rescission or preemptive rights with respect thereto and are not subject to
personal liability solely by reason of being security holders; and none of such
securities were issued in violation of the preemptive rights of any holders of
any security of the Company.
The Common Stock to be issued in accordance with this Agreement and the Standby
Equity Distribution Agreement has been duly authorized and, when issued and paid
for in accordance with this Agreement, the Standby Equity Distribution Agreement
and the Compensation Debenture, the certificates/instruments representing such
Common Stock will be validly issued, fully-paid and non-assessable; the holders
thereof will not be subject to personal liability solely by reason of being such
holders; such Securities are not and will not be subject to the preemptive
rights of any holder of any security of the Company.
The Company has good and marketable title to, or valid and enforceable leasehold
estates in, all items of real and personal property necessary to conduct its
business (including, without limitation, any real or personal property stated in
the Offering Materials to be owned or leased by the Company), free and clear of
all liens, encumbrances, claims, security interests and defects of any material
nature whatsoever, other than those set forth in the Offering Materials and
liens for taxes not yet due and payable.
There is no litigation or governmental proceeding pending or, to the best of the
Company's knowledge, threatened against, or involving the properties or business
of the Company, except as set forth in the Offering Materials.
The Company has been duly organized and is validly existing as a corporation in
good standing under the laws of the State of Idaho. Except as set forth in the
Offering Materials, the Company does not own or control, directly or indirectly,
an interest in any other corporation, partnership, trust, joint venture or other
business entity. The Company is duly qualified or licensed and in good standing
as a foreign corporation in each jurisdiction in which the character of its
operations requires such qualification or licensing and where failure to so
qualify would have a material adverse effect on the Company. The Company has
all requisite corporate power and authority, and all material and necessary
authorizations, approvals, orders, licenses, certificates and permits of and
from all governmental regulatory officials and bodies (domestic and foreign) to
conduct its businesses (and proposed business) as described in the Offering
Materials. Any disclosures in the Offering Materials concerning the effects of
foreign, federal, state and local regulation on the Company's businesses as
currently conducted and as contemplated are correct in all material respects and
do not omit to state a material fact. The Company has all corporate power and
authority to enter into this Agreement, the Standby Equity Distribution
Agreement, the Registration Rights Agreement, and the Escrow Agreement, to carry
out the provisions and conditions hereof and thereof, and all consents,
authorizations, approvals and orders required in connection herewith and
therewith have been obtained. No consent, authorization or order of, and no
filing with, any court, government agency or other body is required by the
Company for the issuance of the Securities or execution and delivery of the
Offering Materials except for applicable federal and state securities laws. The
Company, since its inception, has not incurred any liability arising under or as
a result of the application of any of the provisions of the 1933 Act, the 1934
Act or the Rules and Regulations.
There has been no material adverse change in the condition or prospects of the
Company, financial or otherwise, from the latest dates as of which such
condition or prospects, respectively, are set forth in the Offering Materials,
and the outstanding debt, the property and the business of the Company conform
in all material respects to the descriptions thereof contained in the Offering
Materials.
Except as set forth in the Offering Materials, the Company is not in breach of,
or in default under, any term or provision of any material indenture, mortgage,
deed of trust, lease, note, loan or Standby Equity Distribution Agreement or any
other material agreement or instrument evidencing an obligation for borrowed
money, or any other material agreement or instrument to which it is a party or
by which it or any of its properties may be bound or affected. The Company is
not in violation of any provision of its charter or by-laws or in violation of
any franchise, license, permit, judgment, decree or order, or in violation of
any material statute, rule or regulation. Neither the execution and delivery of
the Offering Materials nor the issuance and sale or delivery of the Securities,
nor the consummation of any of the transactions contemplated in the Offering
Materials nor the compliance by the Company with the terms and provisions hereof
or thereof, has conflicted with or will conflict with, or has resulted in or
will result in a breach of, any of the terms and provisions of, or has
constituted or will constitute a default under, or has resulted in or will
result in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or pursuant to the terms of any indenture,
mortgage, deed of trust, note, loan or any other agreement or instrument
evidencing an obligation for borrowed money, or any other agreement or
instrument to which the Company may be bound or to which any of the property or
assets of the Company is subject except (a) where such default, lien, charge or
encumbrance would not have a material adverse effect on the Company and (b) as
described in the Offering Materials; nor will such action result in any
violation of the provisions of the charter or the by-laws of the Company or,
assuming the due performance by the Placement Agent of its obligations
hereunder,
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any material statute or any material order, rule or regulation applicable to the
Company of any court or of any foreign, federal, state or other regulatory
authority or other government body having jurisdiction over the Company.
Subsequent to the dates as of which information is given in the Offering
Materials, and except as may otherwise be indicated or contemplated herein or
therein and the securities offered pursuant to the Securities Purchase Agreement
dated the date hereof, the Company has not (a) issued any securities or incurred
any liability or obligation, direct or contingent, for borrowed money, or (b)
entered into any transaction other than in the ordinary course of business, or
(c) declared or paid any dividend or made any other distribution on or in
respect of its capital stock. Except as described in the Offering Materials,
the Company has no outstanding obligations to any officer or director of the
Company.
There are no claims for services in the nature of a finder's or origination fee
with respect to the sale of the Common Stock or any other arrangements,
agreements or understandings that may affect the Placement Agent's compensation,
as determined by the National Association of Securities Dealers, Inc.
The Company owns or possesses, free and clear of all liens or encumbrances and
rights thereto or therein by third parties, the requisite licenses or other
rights to use all trademarks, service marks, copyrights, service names, trade
names, patents, patent applications and licenses necessary to conduct its
business (including, without limitation, any such licenses or rights described
in the Offering Materials as being owned or possessed by the Company) and,
except as set forth in the Offering Materials, there is no claim or action by
any person pertaining to, or proceeding, pending or threatened, which challenges
the exclusive rights of the Company with respect to any trademarks, service
marks, copyrights, service names, trade names, patents, patent applications and
licenses used in the conduct of the Company's businesses (including, without
limitation, any such licenses or rights described in the Offering Materials as
being owned or possessed by the Company) except any claim or action that would
not have a material adverse effect on the Company; the Company's current
products, services or processes do not infringe or will not infringe on the
patents currently held by any third party.
Except as described in the Offering Materials, the Company is not under any
obligation to pay royalties or fees of any kind whatsoever to any third party
with respect to any trademarks, service marks, copyrights, service names, trade
names, patents, patent applications, licenses or technology it has developed,
uses, employs or intends to use or employ, other than to their respective
licensors.
Subject to the performance by the Placement Agent of its obligations hereunder
the offer and sale of the Securities complies, and will continue to comply, in
all material respects with the requirements of Rule 506 of Regulation D
promulgated by the SEC pursuant to the 1933 Act and any other applicable federal
and state laws, rules, regulations and executive orders. Neither the Offering
Materials nor any amendment or supplement thereto nor any documents prepared by
the Company in connection with the Offering will contain any untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. All statements of material facts in the
Offering Materials are true and correct as of the date of the Offering
Materials.
All material taxes which are due and payable from the Company have been paid in
full or adequate provision has been made for such taxes on the books of the
Company, except for those taxes disputed in good faith by the Company
None of the Company nor any of its officers, directors, employees or agents, nor
any other person acting on behalf of the Company, has, directly or indirectly,
given or agreed to give any money, gift or similar benefit (other than legal
price concessions to customers in the ordinary course of business) to any
customer, supplier, employee or agent of a customer or supplier, or official or
employee of any governmental agency or instrumentality of any government
(domestic or foreign) or any political party or candidate for office (domestic
or foreign) or other person who is or may be in a position to help or hinder the
business of the Company (or assist it in connection with any actual or proposed
transaction) which (A) might subject the Company to any damage or penalty in any
civil, criminal or governmental litigation or proceeding, or (B) if not given in
the past, might have had a materially adverse effect on the assets, business or
operations of the Company as reflected in any of the financial statements
contained in the Offering Materials, or (C) if not continued in the future,
might adversely affect the assets, business, operations or prospects of the
Company in the future.
Representations, Warranties and Covenants of the Investor.
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(hh) The Investor represents, warrants and covenants as follows:
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The Investor has the necessary power to enter into this Agreement and to
consummate the transactions contemplated hereby.
The execution and delivery by the Investor of this Agreement and the
consummation of the transactions contemplated herein will not result in any
violation of, or be in conflict with, or constitute a default under, any
agreement or instrument to which the Investor is a party or by which the
Investor or its properties are bound, or any judgment, decree, order or, to the
Investor's knowledge, any statute, rule or regulation applicable to the
Investor. This Agreement when executed and delivered by the Investor, will
constitute the legal, valid and binding obligations of the Investor, enforceable
in accordance with their respective terms, except to the extent that (a) the
enforceability hereof or thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws from time to time in effect and
affecting the rights of creditors generally, (b) the enforceability hereof or
thereof is subject to general principles of equity, or (c) the indemnification
provisions hereof or thereof may be held to be in violation of public policy.
The Investor will promptly forward copies of any and all due diligence
questionnaires compiled by the Investor to the Placement Agent.
The Investor is an Accredited Investor (as defined under the 1933 Act).
The Investor is acquiring the Securities for the Inventor's own account as
principal, not as a nominee or agent, for investment purposes only, and not with
a view to, or for, resale, distribution or fractionalization thereof in whole or
in part and no other person has a direct or indirect beneficial interest in such
Securities. Further, the Investor does not have any contract, undertaking,
agreement or arrangement with any person to sell, transfer or grant
participations to such person or to any third person, with respect to any of the
Securities.
The Investor acknowledges the Investor's understanding that the offering and
sale of the Securities is intended to be exempt from registration under the 1933
Act by virtue of Section 3(b) of the 1933 Act and the provisions of Regulation D
promulgated thereunder ("Regulation D"). In furtherance thereof, the Investor
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represents and warrants as follows:
1. The Investor has the financial ability to bear the
economic risk of the Investor's investment, has adequate means
for providing for the Inventor's current needs and personal
contingencies and has no need for liquidity with respect to the
Investor's investment in the Company; and
2. The Investor has such knowledge and experience in
financial and business matters as to be capable of evaluating the
merits and risks of the prospective investment. The Inventor also
represents it has not been organized for the purpose of acquiring
the Securities.
The Investor has been given the opportunity for a reasonable time prior to the
date hereof to ask questions of, and receive answers from, the Company or its
representatives concerning the terms and conditions of the Offering, and other
matters pertaining to this investment, and has been given the opportunity for a
reasonable time prior to the date hereof to obtain such additional information
in connection with the Company in order for the Investor to evaluate the merits
and risks of purchase of the Securities, to the extent the Company possesses
such information or can acquire it without unreasonable effort or expense. The
Investor is not relying on the Placement Agent or any of its affiliates with
respect to the accuracy or completeness of the Offering Materials or for any
economic considerations involved in this investment.
Certain Covenants and Agreements of the Company.
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The Company covenants and agrees at its expense and without any expense to the
Placement Agent as follows:
(ii) To advise the Placement Agent and the Investor of any
material adverse change in the Company's financial condition, prospects or
business or of any development materially affecting the Company or rendering
untrue or misleading any material statement in the Offering Materials occurring
at any time as soon as the Company is either informed or becomes aware thereof.
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(jj) To use its commercially reasonable efforts to cause the
Common Stock issuable in connection with the Standby Equity Distribution
Agreement to be qualified or registered for sale on terms consistent with those
stated in the Registration Rights Agreement and under the securities laws of
such jurisdictions as the Placement Agent and the Investor shall reasonably
request. Qualification, registration and exemption charges and fees shall be at
the sole cost and expense of the Company.
(kk) Upon written request, to provide and continue to provide the
Placement Agent and the Investor copies of all quarterly financial statements
and audited annual financial statements prepared by or on behalf of the Company,
other reports prepared by or on behalf of the Company for public disclosure and
all documents delivered to the Company's stockholders.
(ll) To deliver, during the registration period of the Standby
Equity Distribution Agreement, to the Investor upon the Investor's request,
within forty five (45) days, a statement of its income for each such quarterly
period, and its balance sheet and a statement of changes in stockholders' equity
as of the end of such quarterly period, all in reasonable detail, certified by
its principal financial or accounting officer; (ii) within ninety (90) days
after the close of each fiscal year, its balance sheet as of the close of such
fiscal year, together with a statement of income, a statement of changes in
stockholders' equity and a statement of cash flow for such fiscal year, such
balance sheet, statement of income, statement of changes in stockholders' equity
and statement of cash flow to be in reasonable detail and accompanied by a copy
of the certificate or report thereon of independent auditors if audited
financial statements are prepared; and (iii) a copy of all documents, reports
and information furnished to its stockholders at the time that such documents,
reports and information are furnished to its stockholders.
(mm) To comply with the terms of the Offering Materials.
(nn) To ensure that any transactions between or among the
Company, or any of its officers, directors and affiliates be on terms and
conditions that are no less favorable to the Company, than the terms and
conditions that would be available in an "arm's length" transaction with an
independent third party.
Indemnification and Limitation of Liability.
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(oo) The Company hereby agrees that it will indemnify and hold
the Placement Agent and each officer, director, shareholder, employee or
representative of the Placement Agent and each person controlling, controlled by
or under common control with the Placement Agent within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act or the SEC's Rules and
Regulations promulgated thereunder (the "Rules and Regulations"), harmless from
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and against any and all loss, claim, damage, liability, cost or expense
whatsoever (including, but not limited to, any and all reasonable legal fees and
other expenses and disbursements incurred in connection with investigating,
preparing to defend or defending any action, suit or proceeding, including any
inquiry or investigation, commenced or threatened, or any claim whatsoever or in
appearing or preparing for appearance as a witness in any action, suit or
proceeding, including any inquiry, investigation or pretrial proceeding such as
a deposition) to which the Placement Agent or such indemnified person of the
Placement Agent may become
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subject under the 1933 Act, the 1934 Act, the Rules and Regulations, or any
other federal or state law or regulation, common law or otherwise, arising out
of or based upon (i) any untrue statement or alleged untrue statement of a
material fact contained in (a) Section 4 of this Agreement, (b) the Offering
Materials (except those written statements relating to the Placement Agent given
by the Placement Agent for inclusion therein), (c) any application or other
document or written communication executed by the Company or based upon written
information furnished by the Company filed in any jurisdiction in order to
qualify the Common Stock under the securities laws thereof, or any state
securities commission or agency; (ii) the omission or alleged omission from
documents described in clauses (a), (b) or (c) above of a material fact required
to be stated therein or necessary to make the statements therein not misleading;
or (iii) the breach of any representation, warranty, covenant or agreement made
by the Company in this Agreement. The Company further agrees that upon demand
by an indemnified person, at any time or from time to time, it will promptly
reimburse such indemnified person for any loss, claim, damage, liability, cost
or expense actually and reasonably paid by the indemnified person as to which
the Company has indemnified such person pursuant hereto. Notwithstanding the
foregoing provisions of this Paragraph 7(A), any such payment or reimbursement
by the Company of fees, expenses or disbursements incurred by an indemnified
person in any proceeding in which a final judgment by a court of competent
jurisdiction (after all appeals or the expiration of time to appeal) is entered
against the Placement Agent or such indemnified person based upon specific
finding of fact that the Placement Agent or such indemnified person's gross
negligence or willful misfeasance will be promptly repaid to the Company.
(pp) The Placement Agent hereby agrees that it will indemnify and
hold the Company and each officer, director, shareholder, employee or
representative of the Company, and each person controlling, controlled by or
under common control with the Company within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act or the Rules and Regulations, harmless
from and against any and all loss, claim, damage, liability, cost or expense
whatsoever (including, but not limited to, any and all reasonable legal fees and
other expenses and disbursements incurred in connection with investigating,
preparing to defend or defending any action, suit or proceeding, including any
inquiry or investigation, commenced or threatened, or any claim whatsoever or in
appearing or preparing for appearance as a witness in any action, suit or
proceeding, including any inquiry, investigation or pretrial proceeding such as
a deposition) to which the Company or such indemnified person of the Company may
become subject under the 1933 Act, the 1934 Act, the Rules and Regulations, or
any other federal or state law or regulation, common law or otherwise, arising
out of or based upon (i) the material breach of any representation, warranty,
covenant or agreement made by the Placement Agent in this Agreement, or (ii) any
false or misleading information provided to the Company in writing by one of the
Placement Agent's indemnified persons specifically for inclusion in the Offering
Materials.
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(qq) The Investor hereby agrees that it will indemnify and hold
the Placement Agent and each officer, director, shareholder, employee or
representative of the Placement Agent, and each person controlling, controlled
by or under common control with the Placement Agent within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act or the Rules and
Regulations, harmless from and against any and all loss, claim, damage,
liability, cost or expense whatsoever (including, but not limited to, any and
all reasonable legal fees and other expenses and disbursements incurred in
connection with investigating, preparing to defend or defending any action, suit
or proceeding, including any inquiry or investigation, commenced or threatened,
or any claim whatsoever or in appearing or preparing for appearance as a witness
in any action, suit or proceeding, including any inquiry, investigation or
pretrial proceeding such as a deposition) to which the Placement Agent or such
indemnified person of the Placement Agent may become subject under the 1933 Act,
the 1934 Act, the Rules and Regulations, or any other federal or state law or
regulation, common law or otherwise, arising out of or based upon (i) the
conduct of the Investor or its officers, employees or representatives in its
acting as the Investor for the Offering, (ii) the material breach of any
representation, warranty, covenant or agreement made by the Investor in the
Offering Materials, or (iii) any false or misleading information provided to the
Placement Agent by one of the Investor's indemnified persons.
(rr) The Placement Agent hereby agrees that it will indemnify and
hold the Investor and each officer, director, shareholder, employee or
representative of the Investor, and each person controlling, controlled by or
under common control with the Investor within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act or the Rules and Regulations, harmless
from and against any and all loss, claim, damage, liability, cost or expense
whatsoever (including, but not limited to, any and all reasonable legal fees and
other expenses and disbursements incurred in connection with investigating,
preparing to defend or defending any action, suit or proceeding, including any
inquiry or investigation, commenced or threatened, or any claim whatsoever or in
appearing or preparing for appearance as a witness in any action, suit or
proceeding, including any inquiry, investigation or pretrial proceeding such as
a deposition) to which the Investor or such indemnified person of the Investor
may become subject under the 1933 Act, the 1934 Act, the Rules and Regulations,
or any other federal or state law or regulation, common law or otherwise,
arising out of or based upon the material breach of any representation,
warranty, covenant or agreement made by the Placement Agent in this Agreement.
(ss) Promptly after receipt by an indemnified party of notice of
commencement of any action covered by Section 7(A), (B), (C) or (D), the party
to be indemnified shall, within five (5) business days, notify the indemnifying
party of the commencement thereof; the omission by one (1) indemnified party to
so notify the indemnifying party shall not relieve the indemnifying party of its
obligation to indemnify any other indemnified party that has given such notice
and shall not relieve the indemnifying party of any liability outside of this
indemnification if not materially prejudiced thereby. In the event that any
action is brought against the indemnified party, the indemnifying party will be
entitled to participate therein and, to the extent it may desire, to assume and
control the defense thereof with counsel chosen by it which is reasonably
acceptable to the indemnified party. After notice from the indemnifying party
to such indemnified party of its election to so assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under such
Section 7(A), (B),
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(C), or (D) for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof, but the indemnified
party may, at its own expense, participate in such defense by counsel chosen by
it, without, however, impairing the indemnifying party's control of the defense.
Subject to the proviso of this sentence and notwithstanding any other statement
to the contrary contained herein, the indemnified party or parties shall have
the right to choose its or their own counsel and control the defense of any
action, all at the expense of the indemnifying party if (i) the employment of
such counsel shall have been authorized in writing by the indemnifying party in
connection with the defense of such action at the expense of the indemnifying
party, or (ii) the indemnifying party shall not have employed counsel reasonably
satisfactory to such indemnified party to have charge of the defense of such
action within a reasonable time after notice of commencement of the action, or
(iii) such indemnified party or parties shall have reasonably concluded that
there may be defenses available to it or them which are different from or
additional to those available to one or all of the indemnifying parties (in
which case the indemnifying parties shall not have the right to direct the
defense of such action on behalf of the indemnified party or parties), in any of
which events such fees and expenses of one additional counsel shall be borne by
the indemnifying party; provided, however, that the indemnifying party shall
not, in connection with any one action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstance, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys at any time for all such indemnified
parties. No settlement of any action or proceeding against an indemnified party
shall be made without the consent of the indemnifying party.
(tt) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in Section 7(A) or 7(B)
is due in accordance with its terms but is for any reason held by a court to be
unavailable on grounds of policy or otherwise, the Company and the Placement
Agent shall contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with the
investigation or defense of same) which the other may incur in such proportion
so that the Placement Agent shall be responsible for such percent of the
aggregate of such losses, claims, damages and liabilities as shall equal the
percentage of the gross proceeds paid to the Placement Agent and the Company
shall be responsible for the balance; provided, however, that no person guilty
of fraudulent misrepresentation within the meaning of Section 11(f) of the 1933
Act shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 7(F), any person
controlling, controlled by or under common control with the Placement Agent, or
any partner, director, officer, employee, representative or any agent of any
thereof, shall have the same rights to contribution as the Placement Agent and
each person controlling, controlled by or under common control with the Company
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
and each officer of the Company and each director of the Company shall have the
same rights to contribution as the Company. Any party entitled to contribution
will, promptly after receipt of notice of commencement of any action, suit or
proceeding against such party in respect of which a claim for contribution may
be made against the other party under this Section 7(D), notify such party from
whom contribution may be sought, but the omission to so notify such party shall
not relieve the party from whom contribution may be sought from any obligation
they may have hereunder or otherwise if the party from whom contribution may be
sought is not materially prejudiced thereby.
9
(uu) The indemnity and contribution agreements contained in this
Section 7 shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of any indemnified person or any termination
of this Agreement.
(vv) The Company hereby waives, to the fullest extent permitted
by law, any right to or claim of any punitive, exemplary, incidental, indirect,
special, consequential or other damages (including, without limitation, loss of
profits) against the Placement Agent and each officer, director, shareholder,
employee or representative of the placement agent and each person controlling,
controlled by or under common control with the Placement Agent within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act or the Rules
and Regulations arising out of any cause whatsoever (whether such cause be based
in contract, negligence, strict liability, other tort or otherwise).
Notwithstanding anything to the contrary contained herein, the aggregate
liability of the Placement Agent and each officer, director, shareholder,
employee or representative of the Placement Agent and each person controlling,
controlled by or under common control with the Placement Agent within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act or the Rules
and Regulations shall not exceed the compensation received by the Placement
Agent pursuant to Section 2 hereof. This limitation of liability shall apply
regardless of the cause of action, whether contract, tort (including, without
limitation, negligence) or breach of statute or any other legal or equitable
obligation.
Payment of Expenses.
-------------------
The Company hereby agrees to bear all of the expenses in connection with the
Offering, including, but not limited to the following: filing fees, printing and
duplicating costs, advertisements, postage and mailing expenses with respect to
the transmission of Offering Materials, registrar and transfer agent fees,
escrow agent fees and expenses, fees of the Company's counsel and accountants,
issue and transfer taxes, if any.
Conditions of Closing.
---------------------
The Closing shall be held at the offices of the Investor or its counsel. The
obligations of the Placement Agent hereunder shall be subject to the continuing
accuracy of the representations and warranties of the Company and the Investor
herein as of the date hereof and as of the Date of Closing (the "Closing Date")
------------
with respect to the Company or the Investor, as the case may be, as if it had
been made on and as of such Closing Date; the accuracy on and as of the Closing
Date of the statements of the officers of the Company made pursuant to the
provisions hereof; and the performance by the Company and the Investor on and as
of the Closing Date of its covenants and obligations hereunder and to the
following further conditions:
(ww) Upon the effectiveness of a registration statement covering
the Standby Equity Distribution Agreement, the Investor and the Placement Agent
shall receive the opinion of Counsel to the Company, dated as of the date
thereof, which opinion shall be in form and substance reasonably satisfactory to
the Investor, their counsel and the Placement Agent.
(xx) At or prior to the Closing, the Investor and the Placement
Agent shall have been furnished such documents, certificates and opinions as it
may reasonably require for the purpose of enabling them to review or pass upon
the matters referred to in this Agreement and the Offering Materials, or in
order to evidence the accuracy, completeness or satisfaction of any of the
representations, warranties or conditions herein contained.
10
(yy) At and prior to the Closing, (i) there shall have been no
material adverse change nor development involving a prospective change in the
condition or prospects or the business activities, financial or otherwise, of
the Company from the latest dates as of which such condition is set forth in the
Offering Materials; (ii) there shall have been no transaction, not in the
ordinary course of business except the transactions pursuant to the Securities
Purchase Agreement entered into by the Company on the date hereof which has not
been disclosed in the Offering Materials or to the Placement Agent in writing;
(iii) except as set forth in the Offering Materials, the Company shall not be in
default under any provision of any instrument relating to any outstanding
indebtedness for which a waiver or extension has not been otherwise received;
(iv) except as set forth in the Offering Materials, the Company shall not have
issued any securities (other than those to be issued as provided in the Offering
Materials) or declared or paid any dividend or made any distribution of its
capital stock of any class and there shall not have been any change in the
indebtedness (long or short term) or liabilities or obligations of the Company
(contingent or otherwise) and trade payable debt; (v) no material amount of the
assets of the Company shall have been pledged or mortgaged, except as indicated
in the Offering Materials; and (v) no action, suit or proceeding, at law or in
equity, against the Company or affecting any of its properties or businesses
shall be pending or threatened before or by any court or federal or state
commission, board or other administrative agency, domestic or foreign, wherein
an unfavorable decision, ruling or finding could materially adversely affect the
businesses, prospects or financial condition or income of the Company, except as
set forth in the Offering Materials.
(zz) If requested at Closing the Investor and the Placement Agent
shall receive a certificate of the Company signed by an executive officer and
chief financial officer, dated as of the applicable Closing, to the effect that
the conditions set forth in subparagraph (C) above have been satisfied and that,
as of the applicable closing, the representations and warranties of the Company
set forth herein are true and correct.
(aaa) The Placement Agent shall have no obligation to insure that
(x) any check, note, draft or other means of payment for the Common Stock will
be honored, paid or enforceable against the Investor in accordance with its
terms, or (y) subject to the performance of the Placement Agent's obligations
and the accuracy of the Placement Agent's representations and warranties
hereunder, (1) the Offering is exempt from the registration requirements of the
1933 Act or any applicable state "Blue Sky" law or (2) the Investor is an
Accredited Investor.
Termination.
-----------
This Agreement shall be co-terminus with, and terminate upon the same terms and
conditions as those set forth in, the Standby Equity Distribution Agreement.
The rights of the Investor and the obligations of the Company under the
Registration Rights Agreement, and the rights of the Placement Agent and the
obligations of the Company shall survive the termination of this Agreement
unabridged.
11
Miscellaneous.
-------------
(bbb) This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all which
shall be deemed to be one and the same instrument.
(ccc) Any notice required or permitted to be given hereunder
shall be given in writing and shall be deemed effective when deposited in the
United States mail, postage prepaid, or when received if personally delivered or
faxed (upon confirmation of receipt received by the sending party), addressed as
follows to such other address of which written notice is given to the others):
If to Placement Agent, to: Newbridge Securities Corporation
0000 Xxxxxxx Xxxxx Xxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Company, to: Intrepid Technology & Resources, Inc.
000 Xxxx Xxxxxxxx - Xxxxx 000
Xxxxx Xxxxx, XX 00000
Attention: Xx. Xxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to: Xxxxxxxxxxx & Xxxxxxxx LLP
000 Xxxxx Xxxxxxxx Xxxxxxxxx - Xxxxx 0000
Xxxxx, Xxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Investor: Cornell Capital Partners, LP
000 Xxxxxx Xxxxxx - Xxxxx 0000
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Attention: Xxxx X. Xxxxxx
Portfolio Manager
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With copies to: Xxxxx Xxxxxxxx, Esq.
000 Xxxxxx Xxxxxx - Xxxxx 0000
Xxxxxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(ddd) This Agreement shall be governed by and construed in all
respects under the laws of the State of ____, without reference to its conflict
of laws rules or principles. Any suit, action, proceeding or litigation arising
out of or relating to this Agreement shall be
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brought and prosecuted in such federal or state court or courts located within
the State of New Jersey as provided by law. The parties hereby irrevocably and
unconditionally consent to the jurisdiction of each such court or courts located
within the State of New Jersey and to service of process by registered or
certified mail, return receipt requested, or by any other manner provided by
applicable law, and hereby irrevocably and unconditionally waive any right to
claim that any suit, action, proceeding or litigation so commenced has been
commenced in an inconvenient forum.
(eee) This Agreement and the other agreements referenced herein
contain the entire understanding between the parties hereto and may not be
modified or amended except by a writing duly signed by the party against whom
enforcement of the modification or amendment is sought.
(fff) If any provision of this Agreement shall be held to be
invalid or unenforceable, such invalidity or unenforceability shall not affect
any other provision of this Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first written above.
COMPANY:
INTREPID TECHNOLOGY & RESOURCES, INC.
By:
----------------------------------
Name: Xx. Xxxxxx X. Xxxxxx
Title: President & CEO
PLACEMENT AGENT:
NEWBRIDGE SECURITIES CORPORATION
By:
----------------------------------
Name: Xxx X. Xxxxx
Title: President
INVESTOR:
CORNELL CAPITAL PARTNERS, LP
BY: YORKVILLE ADVISORS, LLC
ITS: GENERAL PARTNER
By:
----------------------------------
Name: Xxxx X. Xxxxxx
Title: Portfolio Manager
14
