PLACEMENT AGENT AGREEMENT
Exhibit
1.1
Dated
December 10, 2009
Jesup
& Xxxxxx Securities Corp.
000 Xxxxx
Xxxxxx
Xxx Xxxx,
XX 00000
Ladies
and Gentlemen:
New
Generation Biofuels Holdings, Inc., a Florida corporation (the “Company”)
proposes, subject to the terms and conditions of this Placement Agent Agreement
(this “Agreement”) and the Subscription Agreements in the form of Exhibit A attached
hereto (the “Subscription Agreements”) to be entered into with the investors
identified therein (each, an “Investor,” and, collectively, the “Investors”), to
issue up to an aggregate of 2,804,228 units (the “Units”), with each Unit
consisting of (i) one share (each, a “Share”) of the Company’s common stock, par
value $.001 per share (“Common Stock”) and (ii) one warrant to
purchase 0.30 shares of Common Stock at an exercise price of $0.90 per
share (the “Warrant” and the shares issuable upon exercise of the Warrant are
referred to herein as the “Warrant Shares”). The Units, the Shares,
the Warrants and the Warrant Shares are herein referred to as the
“Securities.” The Company hereby confirms its agreement with Jesup
& Xxxxxx Securities Corp. to act as Placement Agent (the “Placement Agent”)
in accordance with the terms and conditions hereof.
1. Agreement to Act as
Placement Agent. On the basis of the representations,
warranties and agreements of the Company herein contained, and subject to the
terms and conditions set forth in this Agreement:
A. The
Company hereby authorizes the Placement Agent to act as its exclusive placement
agent in connection with the issuance and sale of the Company of the Units (the
“Offering”) to the Investors, and the Placement Agent hereby agrees, as agent of
the Company, to use its best efforts to solicit offers to purchase the Units
from the Company on the terms and subject to the conditions set forth in the
Prospectus Documents (as defined below). The Placement Agent shall use best
efforts to assist the Company in obtaining performance by each Investor whose
offer to purchase Units has been solicited by the Placement Agent and accepted
by the Company, but the Placement Agent shall not, except as otherwise provided
in this Agreement, have any liability to the Company in the event any such
purchase is not consummated for any reason. Under no circumstances will the
Placement Agent or any of its affiliates be obligated to underwrite or purchase
any of the Shares or Warrants for their own accounts or otherwise provide any
financing. The Placement Agent shall act solely as the Company’s agent and not
as principal. The Placement Agent shall communicate to the Company, orally or in
writing, each reasonable offer to purchase Units received by it as an agent of
the Company. The Placement Agent shall have no authority to bind the
Company with respect to any prospective offer to purchase Units and the Company
shall have the sole right to accept offers to purchase Units and may reject any
such offer, in whole or in part. Notwithstanding the foregoing, the Placement
Agent (or its affiliates) may, solely at its discretion and without any
obligations, purchase Units as principal. The Placement Agent is
hereby authorized to engage, at its option, the services of sub-placement agents
and/or selected dealers to assist it in soliciting subscribers and to remit to
such sub-placement agents or selected dealers the commissions payable to the
Placement Agent hereunder as they shall determine.
B. As
compensation for services rendered, on the Closing Date, the Company shall pay
or cause to be paid to the Placement Agent by wire transfer of immediately
available funds to an account or accounts designated by the Placement Agent an
aggregate amount equal to seven percent (7.0%) of the gross proceeds received by
the Company from its sale of the Units on such Closing Date. In
addition, on the Closing Date the Company shall issue to the Placement Agent
warrants (the “Placement Agent Warrants”) to purchase an aggregate number of
shares of Common Stock equal to the lesser of (i) seven percent (7.0%) of the
Shares sold in the Offering or (ii) the maximum amount permitted by the
Financial Industry Regulatory Authority, Inc. (“FINRA”). The
Placement Agent Warrants shall have the same terms as the other Warrants sold in
the Offering, except that the Placement Agent Warrants shall also have cashless
exercise feature. The Placement Agent Warrants are included in the
term “Warrants” as used herein, and the number of shares of Common Stock
issuable upon exercise of the Placement Agent Warrants is included in the term
“Warrant Shares” as used herein.
C. The
Units are being sold to the Investors at a price of $0.80 per
Unit. The purchases of the Units by the Investors shall be evidenced
by the execution of Subscription Agreement by each of the Investors and the
Company.
D. Prior
to the earlier of (i) the date on which this Agreement is terminated and (ii)
the Closing Date, the Company shall not, without the prior written consent of
the Placement Agent, solicit or accept offers to purchase shares of Common Stock
(other than pursuant to the exercise of options or warrants to purchase shares
of Common Stock that are outstanding at the date hereof) other than through the
Placement Agent in accordance herewith.
E. No
Units which the Company has agreed to sell pursuant to this Agreement shall be
deemed to have been purchased and paid for, or sold by the Company, until such
Units shall have been delivered to or made available for electronic receipt by
the Investor purchasing such Units against payment by such Investor. If the
Company shall default in its obligations to deliver Units to an Investor whose
offer it has accepted, the Company shall indemnify and hold the Indemnified
Persons (as defined below) harmless against any loss, claim, damage or liability
directly or indirectly arising from or as a result of such default by the
Company in accordance with the procedures in Section 5 hereof.
F. Payment
of the purchase price for, and delivery of, the Units shall be made at a closing
(the “Closing”) at the offices of Xxxxxxxxxx & Xxxxx LLP, counsel for the
Placement Agent, located at 00000 Xxxxxxxx Xxxx., Xxxxx 000, Xxx Xxxxxxx, XX
00000, at 11:00 A.M., New York time, on December 16, 2009 or at such other time
and date as the Placement Agent and the Company determine pursuant to Rule
15c6−1(a) under the Exchange Act (as defined below) (such date of payment and
delivery being herein referred to as the “Closing Date”). Payment of the
purchase price for, and delivery of, the Units shall be made in the manner set
forth in the Subscription Agreements.
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2. Registration Statement and
Prospectus.
A. The
Offering is being made pursuant to (i) an effective Registration Statement
on Form S-3 (No. 333-156449) (including the Base Prospectus contained
therein dated January 27, 2009 (the “Base Prospectus”)) that has been prepared
and filed by the Company with the Securities and Exchange Commission (the
“Commission”) in conformity with the requirements of the Securities Act of 1933,
as amended (the “Securities Act”) and the published rules and regulations
thereunder (the “Rules and Regulations”) adopted by the Commission relating to
Securities of the Company that may be sold from time to time by the Company in
accordance with Rule 415 of the Securities Act, and such amendments thereof
as may have been required to the date of this Agreement (ii) if applicable,
certain “free writing prospectuses” (as that term is defined in Rule 405
under the Securities Act), that have been or will be filed with the Commission
and delivered to the Investors on or prior to the date hereof and (iii) a
prospectus supplement to be dated the date hereof, containing certain
supplemental information regarding the Securities, the Company and the terms of
the offering that will be filed with the Commission (the “Prospectus
Supplement”). Collectively, the Base Prospectus and the Prospectus
Supplement shall be referred to as the “Prospectus Documents.”
B. The
term “Registration Statement” as used in this Agreement means the registration
statement, including all exhibits, financial schedules and all documents and
information deemed to be part of the Registration Statement by incorporation by
reference or otherwise, as amended from time to time, including the information
(if any) contained in the form of final prospectus filed with the Commission
pursuant to Rule 424(b) of the Rules and Regulations and deemed to be part
thereof at the time of effectiveness pursuant to Rule 430B of the Rules and
Regulations. Any reference in this Agreement to the Registration
Statement, the Base Prospectus or the Prospectus Supplement shall be deemed to
refer to and include the documents incorporated by reference therein (the
“Incorporated Documents”) pursuant to Item 12 of Form S-3 which were filed under
the Securities Exchange Act of 1934, as amended (the “Exchange Act”), on or
before the date of this Agreement, or the issue date of the Base Prospectus or
the Prospectus Supplement, as the case may be; and any reference in this
Agreement to the terms “amend,” “amendment” or “supplement” with respect to the
Registration Statement, the Base Prospectus or the Prospectus Supplement shall
be deemed to refer to and include the filing of any document under the Exchange
Act after the date of this Agreement, or the issue date of the Base Prospectus
or the Prospectus Supplement, as the case may be, deemed to be incorporated
therein by reference. All references in this Agreement to financial
statements and schedules and other information that is “contained,” “included,”
“described,” “referenced,” “set forth” or “stated” in the Registration
Statement, the Base Prospectus or the Prospectus Supplement (and all other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information that is or is deemed to
be incorporated by reference in the Registration Statement, the Base Prospectus
or the Prospectus Supplement, as the case may be.
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3. Representations and
Warranties of the Company.
The
Company represents and warrants, as of the date hereof and as of the Closing
Date, as follows:
A. Registration
Statement.
(i) At
the time of the filing of the Registration Statement, the Company met the
requirements of Form S-3 under the Securities Act. Such registration
statement meets the requirements set forth in Rule 415(a)(1)(x) under the
Securities Act and complies with said Rule.
(ii) No
stop order suspending the effectiveness of the Registration Statement or the use
of the Base Prospectus or the Prospectus Supplement has been issued, and no
proceeding for any such purpose is pending or has been initiated or, to the
Company’s knowledge, is threatened by the Commission.
(iii) The
Company is eligible to use free writing prospectuses in connection with the
Offering pursuant to Rules 164 and 433 under the Securities Act. Any
free writing prospectus that the Company is required to file pursuant to Rule
433(d) under the Securities Act and related to the Offering has been, or will
be, filed with the Commission in accordance with the requirements of the
Securities Act and the applicable rules and regulations of the Commission
thereunder. Each free writing prospectus that the Company has filed,
or is required to file, pursuant to Rule 433(d) under the Securities Act and
related to the Offering or that was prepared by or behalf of or used by the
Company complies or will comply in all material respects with the requirements
of the Securities Act and the applicable rules and regulations of the Commission
thereunder. The Company will not, without the prior consent of the
Placement Agent, prepare, use or refer to, any free writing prospectus related
to the Offering.
(iv) The
Company has delivered or made available to, or will as promptly as practicable
deliver or make available to, to the Placement Agent complete conformed copies
of the Registration Statement and of each consent and certificate of experts, as
applicable, filed as a part thereof, and conformed copies of the Registration
Statement (without exhibits) and the Prospectus Documents, as amended or
supplemented, in such quantities and at such places as the Placement Agent
reasonably requests. Neither the Company nor any of its directors and
officers has distributed and none of them will distribute, prior to the Closing,
any offering material in connection with the offering and sale of the Securities
other than the Base Prospectus, the Prospectus Supplement, the Registration
Statement, copies of the documents incorporated by reference therein and any
other materials permitted by the Securities Act.
B. 10b-5
Representation. At the time the Registration Statement became
effective, at the date of this Agreement and at the Closing Date:
(i) The
Registration Statement, the Base Prospectus and the Prospectus Supplement
conformed and will conform in all material respects to the requirements of the
Securities Act and the Rules and Regulations, including, without limitation,
that they did and will contain all material statements that are required to be
stated therein in accordance with the Securities Act and the Rules and
Regulations.
(ii) None
of the Registration Statement, the Base Prospectus, the Prospectus Supplement,
nor any amendment or supplement thereto, does or 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. The
representation and warranty made in this Section 3(B)(ii) does not apply to
statements made or statements omitted in reliance upon and in conformity with
written information furnished to the Company by the Placement Agent expressly
for use in the Registration Statement or Prospectus Documents or any amendment
thereof or supplement thereto.
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(iii) The
Registration Statement (and any further documents to be filed with the
Commission in connection with the Offering) contains, or will contain, as
applicable, all exhibits and schedules as required by the Securities
Act. The Incorporated Documents, when they were filed with the
Commission, conformed in all material respects to the requirements of the
Exchange Act and the applicable Rules and Regulations, and none of such
documents, when they were filed with the Commission, contained any untrue
statement of a material fact or omitted to state a material fact necessary to
make the statements therein (with respect to Incorporated Documents incorporated
by reference in the Base Prospectus or Prospectus Supplement), in light of the
circumstances under which they were made not misleading; and any further
documents so filed and incorporated by reference in the Base Prospectus or
Prospectus Supplement, when such documents are filed with the Commission, will
conform in all material respects to the requirements of the Exchange Act and the
applicable Rules and Regulations, as applicable, and will not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading. No post-effective amendment to the Registration
Statement reflecting any facts or events arising after the date thereof which
represent, individually or in the aggregate, a fundamental change in the
information set forth therein is required to be filed with the
Commission. There are no documents required to be filed with the
Commission in connection with the transaction contemplated hereby that (x) have
not been filed as required pursuant to the Securities Act or (y) will not be
filed within the requisite time period. There are no contracts or
other documents required to be described in the Base Prospectus or Prospectus
Supplement, or to be filed as exhibits or schedules to the Registration
Statement, that have not been or will not be described or filed as
required.
(iv) Disclosure
Requirements. The agreements and documents described in the
Prospectus Documents and the Registration Statement (including the Incorporated
Documents) conform to the descriptions thereof contained therein and there are
no agreements or other documents required by the Securities Act and the Rules
and Regulations to be described in the Prospectus Documents and the Registration
Statement or to be filed with the Commission as exhibits to the Registration
Statement, that have not been so described or filed. Each agreement
or other instrument (however characterized or described) to which the Company is
a party or by which it is or may be bound and (a) that is referred to in
any Prospectus Document, or (b) is material to the Company’s business, has
been duly authorized and validly executed by the Company, is in full force and
effect in all material respects and is enforceable against the Company and, to
the Company’s knowledge, the other parties thereto, in accordance with its
terms, except (1) as such enforceability may be limited by bankruptcy,
insolvency, reorganization or similar laws affecting creditors’ rights
generally, (2) as enforceability of any indemnification or contribution
provision may be limited under the federal and state securities laws, and
(3) that the remedy of specific performance and injunctive and other forms
of equitable relief may be subject to the equitable defenses and to the
discretion of the court before which any proceeding therefore may be
brought. Except as disclosed in the Registration Statement and the
Prospectus Documents, none of such agreements or instruments has been assigned
by the Company, and neither the Company nor, to the best of the Company’s
knowledge, any other party is in default thereunder and, to the best of the
Company’s knowledge, no event has occurred that, with the lapse of time or the
giving of notice, or both, would constitute a default thereunder. To
the best of the Company’s knowledge, performance by the Company of such
agreements or instruments will not result in a violation of any existing
applicable law, rule, regulation, judgment, order or decree of any governmental
agency or court, domestic or foreign, having jurisdiction over the Company or
any of its assets or businesses, including, without limitation, those relating
to environmental laws and regulations, except for any violation that could not
reasonably be expected to have a material adverse effect on the financial
condition, business, assets or results of operations of the Company and its
subsidiaries, taken as a whole (“Material Adverse Effect”).
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(v) Prior Securities
Transactions. Prior to November 1, 2006, no securities of the
Company have been sold by the Company or by or on behalf of, or for the benefit
of, any person or persons controlling, controlled by, or under common control
with the Company, except as disclosed in the Registration
Statement.
(vi) Regulation. The
disclosures in the Registration Statement concerning the effects of federal,
state, local and foreign regulation on this Offering and the Company’s business
purpose as currently contemplated are correct in all material
respects.
C. Changes After Dates in
Registration Statement and Prospectus Supplement.
(i) No Material Adverse
Change. Except as set forth in the Registration Statement and
Prospectus Documents, since the date of the most recent consolidated financial
statements of the Company included or incorporated by reference in the
Registration Statement and prior to the Closing: (a) there has been no
material adverse change in the financial condition or business prospects (as
such prospects are disclosed in the Registration Statement and Prospectus
Documents) of the Company (“Material Adverse Change”); (b) there have been
no material transactions entered into by the Company, other than as contemplated
pursuant to this Agreement; and (iii) no officer or director of the Company
has resigned from any position with the Company.
(ii) Recent Securities
Transactions, etc. Subsequent to the respective dates as of
which information is given in the Prospectus Supplement, and except as may
otherwise be indicated or contemplated herein or disclosed in the Prospectus
Supplement, the Company has not: (a) issued any securities or incurred any
liability or obligation, direct or contingent, for borrowed money; or
(b) declared or paid any dividend or made any other distribution on or in
respect to its capital stock.
D. Financial
Statements. The financial statements, including the notes
thereto and supporting schedules included in the Registration Statement and
Prospectus Documents fairly present in all material respects the financial
position and the results of operations of the Company at the dates and for the
periods to which they apply. Except as may be set forth in the related notes
included or incorporated by reference in the Registration Statement and
Prospectus Documents, such financial statements have been prepared in conformity
with generally accepted accounting principles (“GAAP”), consistently applied
throughout the periods involved, and the supporting schedules included in the
Registration Statement and Prospectus Documents present fairly in all material
respects the information required to be stated therein. The
Registration Statement discloses all material off-balance sheet transactions,
arrangements, obligations (including contingent obligations), and other
relationships of the Company with unconsolidated entities or other persons that
may have a material current or future effect on the Company’s financial
condition, changes in financial condition, results of operations, liquidity,
capital expenditures, capital resources, or significant components of revenues
or expenses.
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E. Capitalization. The
Company has an authorized capitalization, and the issued and outstanding shares
of capital stock as of September 30, 2009 were, as set forth in the Registration
Statement and Prospectus Documents. The Company has not issued any capital stock
since the filing of its Quarterly Report on Form 10-Q for the quarter ended
September 30, 2009, other than: (i) options or the issuance of shares of Common
Stock under the Company’s Omnibus Incentive Plans; (ii) the issuance of Common
Stock upon the exercise of warrants or pursuant to the conversion of preferred
stock, (iii) the issuance of warrants to certain Company consultants or (iv) as
otherwise described in the Registration Statement and Prospectus Documents. No
Person has any right of first refusal, preemptive right, right of participation,
or any similar right to participate in the Offering. Except as set forth in the
Prospectus Documents, there are no outstanding options, warrants, script rights
to subscribe to, calls or commitments of any character whatsoever relating to,
or securities, rights or obligations convertible into or exercisable or
exchangeable for, or giving any Person any right to subscribe for or acquire,
any shares of Common Stock, or contracts, commitments, understandings or
arrangements by which the Company or any Subsidiary is or may become bound to
issue additional shares of Common Stock or Common Stock Equivalents. The
issuance and sale of the Securities will not obligate the Company to issue
shares of Common Stock or other securities to any Person (other than the
Purchasers) and will not result in a right of any holder of Company securities
to adjust the exercise, conversion, exchange or reset price under such
securities. There are no stockholders agreements, voting agreements or other
similar agreements with respect to the Company’s capital stock to which the
Company is a party or, to the knowledge of the Company, between or among any of
the Company’s stockholders.
F. Valid Issuance of
Securities, etc.
(i) Outstanding
Securities. All issued and outstanding securities of the
Company issued prior to the transactions contemplated by this Agreement have
been duly authorized and validly issued and are fully paid and non-assessable
and the holders thereof have no rights of rescission. None of such
securities were issued in violation of the preemptive rights of any holders of
any security of the Company or similar contractual rights granted by the
Company. The securities conform in all material respects to all
statements relating thereto contained in the Registration Statement and the
Prospectus Documents. The offers and sales of the outstanding
securities were at all relevant times either registered under the Securities Act
and the applicable state securities or “Blue Sky” laws or, based in part on the
representations and warranties of the purchasers of such securities, exempt from
such registration requirements.
(ii) Securities Sold Pursuant to
this Agreement. The Securities have been duly authorized and,
when issued and paid for in accordance with this Agreement, will be validly
issued, fully paid and non-assessable. The Securities are not and will not be
subject to the preemptive rights of any holders of any security of the Company
or similar contractual rights granted by the Company; and all corporate action
required to be taken for the authorization, issuance and sale of the Securities
has been duly and validly taken. The Securities conform in all
material respects to all statements with respect thereto contained in the
Registration Statement.
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(iii) Registration Rights of Third
Parties. Except as set forth in the Registration Statement and
Prospectus Documents, no holders of any securities of the Company or any rights
exercisable for or convertible or exchangeable into securities of the Company
have the right to require the Company to register any such securities of the
Company under the Securities Act or to include any such securities in a
registration statement to be filed by the Company.
G. Timely
Filings. The Company has filed all reports to be filed by it
under the Securities Act and the Exchange Act including pursuant to Section
13(a) or 15(a) thereof, for the two years preceding the date hereof (the
foregoing materials including exhibits thereto being collectively referred to as
the “SEC Reports”) on a timely basis or has received valid extension of such
time as following and has filed any such SEC Reports prior to the expiration of
any such extension. As of their respective dates, the SEC Reports
comply in all material respects with the requirements of the Securities Act, and
the Exchange Act and the Rules and Regulations.
H. Validity and Binding Effect
of Agreements. This Agreement has been duly and validly
authorized by the Company, and, when executed and delivered, will constitute,
the valid and binding agreements of the Company, enforceable against the Company
in accordance with their respective terms, except: (i) the enforceability hereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or similar
laws from time to time in effect and affecting the rights of creditors
generally, (ii) the enforceability hereof is subject to general principles of
equity, or (iii) the indemnification provisions hereof may be held to be
violative of public policy.
I. No Conflicts,
etc. The execution, delivery, and performance by the Company
of this Agreement and all ancillary documents, the consummation by the Company
of the transactions herein and therein contemplated and the compliance by the
Company with the terms hereof and thereof do not and will not, with or without
the giving of notice or the lapse of time or both: (i) result in a material
breach of, or conflict with any of the terms and provisions of, or constitute a
material default under, or result in the creation, modification, termination or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company pursuant to the terms of any agreement or instrument to which the
Company is a party; (ii) result in any violation of the provisions of the
Articles of Incorporation of the Company (as the same may be amended from time
to time, the “Articles of Incorporation”); or (iii) violate any existing
applicable law, rule, regulation, judgment, order or decree of any governmental
agency or court, domestic or foreign, having jurisdiction over the Company or
any of its properties or business constituted as of the date hereof, except with
respect to clauses (i), (ii) and (iii), for such breach, conflict, violation or
default as could not reasonably be expected to have a Material Adverse
Effect.
J. No Defaults;
Violations. No material default exists in the due performance
and observance of any term, covenant or condition of any material license,
contract, indenture, mortgage, deed of trust, note, loan or credit agreement, or
any other agreement or instrument evidencing an obligation for borrowed money,
or any other material agreement or instrument to which the Company is a party or
by which the Company may be bound or to which any of the properties or assets of
the Company is subject. The Company is not in violation of any term
or provision of its Articles of Incorporation or Bylaws, or in violation of any
franchise, license, permit, applicable law, rule, regulation, judgment or decree
of any governmental agency or court, domestic or foreign, having jurisdiction
over the Company or any of its properties or businesses, except for such
violations that could not reasonably be expected to have a Material Adverse
Effect.
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K. Corporate Power; Licenses;
Consents.
(i) Conduct of
Business. Except as described in the Registration Statement
and the Prospectus Documents, the Company has all requisite corporate power and
authority, and has all necessary authorizations, approvals, orders, licenses,
certificates and permits of and from all governmental regulatory officials and
bodies that it needs as of the date hereof to conduct its business purpose as
described in the Registration Statement and Prospectus Documents, except where
the failure to have such requisite corporate power and authority and all
authorizations, approvals, orders, licenses, certificates and permits could not
reasonably be expected to have a Material Adverse Effect.
(ii) Transactions Contemplated
Herein. The Company has all corporate power and authority to
enter into this Agreement and to carry out the provisions and conditions hereof,
and all consents, authorizations, approvals and orders required in connection
therewith have been obtained. No consent, authorization or order of,
and no filing with, any court, government agency or other body is required for
the valid issuance, sale and delivery of the Securities and the consummation of
the transactions and agreements contemplated by this Agreement and as
contemplated by the Prospectus Documents, except with respect to applicable
federal and state securities laws and regulations and the rules and regulations
of FINRA.
L. D&O
Questionnaires. To the Company’s knowledge, all information
contained in the Questionnaires for Directors and Executive Officers (the
“Questionnaires”) completed by each of the Company’s directors and officers
immediately prior to the Offering is true and correct in all respects and the
Company has not become aware of any information which would cause the
information disclosed in the questionnaires completed by each such director or
officer to become inaccurate and incorrect.
M. Good
Standing. The Company has been duly organized and is validly
existing as a corporation and is in good standing under the laws of the State of
Florida as of the date hereof, and is duly qualified to do business and is in
good standing in each jurisdiction in which its ownership or lease of property
or the conduct of business requires such qualification, except where the failure
to qualify could not reasonably be expected to have a Material Adverse
Effect.
N. Subsidiaries. Except
for New Generation Biofuels, Inc. (“NGB Inc.”), a Delaware corporation and NGB
Marketing LLC, a Delaware limited liability company (“NGB Marketing” and
together with NGB Inc. the “Subsidiaries”), the Company has no
subsidiaries. The Subsidiaries have been duly organized and are in
good standing under the laws of the place of organization or incorporation, and
each Subsidiary is in good standing in each jurisdiction in which its ownership
or lease of property or the conduct of business requires such qualification,
except where the failure to qualify could not reasonably be expected to have a
Material Adverse Effect.
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O. Litigation; Governmental
Proceedings. There is no action, suit, proceeding, inquiry,
arbitration, investigation, litigation or governmental proceeding pending or, to
the Company’s knowledge, threatened against, or involving the Company or its
Subsidiaries or, to the Company’s knowledge, any executive officer or director
that is (i) required to be disclosed in the Registration Statement and the
Prospectus Documents which has not been disclosed in the Registration Statement
and the Prospectus Documents or (ii) required to be disclosed in connection with
the Company’s notification to list the Shares on the NASDAQ Capital Market
(“NASDAQ”) which has not been disclosed in such listing
application.
P. Title to
Assets. The Company owns no real property. Other than liens on
personal or other property securing indebtedness of the Company in the ordinary
course of business or as described in the Prospectus Documents, the Company has
good and valid title in all personal property owned by them that is material to
the business of the Company and the Subsidiaries, in each case free and clear of
all liens, charges or encumbrances (except for liens, charges or encumbrances as
do not materially affect the value of such property and do not materially
interfere with the use made and proposed to be made of such property by the
Company and the Subsidiaries and liens, charges or encumbrances for the payment
of federal, state or other taxes, the payment of which is neither delinquent nor
subject to penalties.) Any real property and facilities held under lease by the
Company and the Subsidiaries are held by them under valid, subsisting and
enforceable leases of which the Company and the Subsidiaries are in material
compliance.
Q. Intellectual
Property. Except, in each case, as disclosed in the
Registration Statement and Prospectus Documents or except as could not
reasonably be expected to have a Material Adverse Effect:
(i) the
Company and the Subsidiaries have, or have rights to use, all patents, patent
applications, trademarks, trademark applications, service marks, trade names,
trade secrets, inventions, copyrights, licenses and other similar intellectual
property rights necessary or material for use in connection with their
respective businesses (collectively, the “Intellectual Property
Rights”);
(ii)
neither the Company nor any Subsidiary has received a notice (written or
otherwise) that the Intellectual Property Rights used by the Company or any
Subsidiary violates or infringes upon the rights of any Person;
(iii) to
the knowledge of the Company, all such Intellectual Property Rights are
enforceable and there is no existing infringement by another Person of any of
the Intellectual Property Rights of others; and
(iv) the
Company and its Subsidiaries have taken reasonable security measures to protect
the secrecy, confidentiality and value of all of their intellectual
properties.
10
R. Transactions Affecting
Disclosure to FINRA.
(i) Finder’s
Fees. Except as described in the Registration Statement and
the Prospectus Documents, there are no claims, payments, arrangements,
agreements or understandings relating to the payment of a finder’s, consulting
or origination fee by the Company or any director or officer of the Company with
respect to the sale of the Securities hereunder or any other arrangements,
agreements or understandings of the Company or, to the Company’s knowledge, any
of its shareholders that may affect the Placement Agent’s compensation, as
determined by FINRA.
(ii) Payments Within Twelve
Months. Except as described in the Registration Statement and
the Prospectus Documents or in the Company’s FINRA questionnaire completed in
November 2009, the Company has not made any direct or indirect payments (in
cash, securities or otherwise) to: (i) any person, as a finder’s fee,
consulting fee or otherwise, in consideration of such person raising capital for
the Company or introducing to the Company persons who raised or provided capital
to the Company; (ii) to any FINRA member; or (iii) to any person or
entity that has any direct or indirect affiliation or association with any FINRA
member, within the twelve months prior to the Closing, other than payments to
the Placement Agent as provided hereunder in connection with the
Offering.
(iii) Use of
Proceeds. None of the net proceeds of the Offering will be
paid by the Company to any participating FINRA member or its affiliates, except
as specifically authorized herein.
(iv) FINRA
Affiliation. To the Company’s knowledge, no officer, director
or any beneficial owner of the Company’s unregistered securities has any direct
or indirect affiliation or association with any FINRA member (as determined in
accordance with the rules and regulations of FINRA), except as set forth in the
Registration Statement. The Company will advise the Placement Agent
and its counsel if it learns that any officer, director or owner of at least 5%
of the Company’s outstanding Common Stock (or securities convertible into Common
Stock) is or becomes an affiliate or associated person of a FINRA member
participating in the Offering.
S. Foreign Corrupt Practices
Act. Neither the Company nor any of its directors, employees
or officers or any other person acting on behalf of the Company has, directly or
indirectly, given or agreed to give any unlawful 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 any political party or candidate for office
(domestic or foreign) or other person who was, 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) that (i) might subject the Company to any
damage or penalty in any civil, criminal or governmental litigation or
proceeding, (ii) if not given in the past or not continued in the future,
might have had or will have a Material Adverse Effect. The Company
has taken reasonable steps to ensure that its accounting controls and procedures
are sufficient to cause the Company to comply in all material respects with the
Foreign Corrupt Practices Act of 1977, as amended.
11
T. Officers’
Certificate. Any certificate pursuant to this Agreement signed
by any duly authorized officer of the Company and delivered to the Placement
Agent shall be deemed a representation and warranty by the Company to the
Placement Agent as to the matters covered thereby.
U. “Ineligible
Issuer.” As of the date of the Prospectus Supplement, the
Company is not an “ineligible issuer” in connection with the Offering as defined
in Rule 405 under the Securities Act.
V. Adequate
Summary. The statements set forth in the Prospectus Documents
under the captions “The Offering,” “Description of Securities”, insofar as they
purport to constitute a summary of the terms of the Securities, and under the
caption “Plan of Distribution”, insofar as they purport to describe the
provisions of the laws and documents referred to therein, are accurate summaries
of such provisions in all material respects.
W. Related Party
Transactions. Except as disclosed in the Registration
Statement and the Prospectus Documents, there are no business relationships or
related party transactions involving the Company or any other person required to
be described in the Registration Statements and Prospectus Documents that have
not been described as required.
X. Board of
Directors. The Board of Directors of the Company is comprised
of the persons set forth in the Incorporated Documents. The
qualifications of the persons serving as board members and the overall
composition of the board comply with the Xxxxxxxx-Xxxxx Act of 2002 and the
rules promulgated thereunder applicable to the Company and the rules of
NASDAQ. At least one member of the Board of Directors of the Company
qualifies as a “financial expert” as such term is defined under the
Xxxxxxxx-Xxxxx Act of 2002 and the rules promulgated thereunder and the rules of
NASDAQ. In addition, at least a majority of the persons serving on the Board of
Directors qualify as “independent” as defined under the rules of
NASDAQ.
X. Xxxxxxxx-Xxxxx
Compliance.
(i) Disclosure
Controls. The Company has developed and currently maintains
disclosure controls and procedures that will comply with Rule 13a-15 or 15d-15
of the Exchange Act, and such controls and procedures are effective to ensure
that all material information concerning the Company will be made known on a
timely basis to the individuals responsible for the preparation of the Company’s
Exchange Act filings and other public disclosure documents.
(ii) Compliance. The
Company is, or on the Closing Date will be, in material compliance with the
provisions of the Xxxxxxxx-Xxxxx Act of 2002 applicable to it, and has
implemented or will implement such programs and taken reasonable steps to ensure
the Company’s future compliance (not later than the relevant statutory and
regulatory deadlines therefore) with all the material provisions of the
Xxxxxxxx-Xxxxx Act of 2002.
Z. Independent
Accountants. Each of Xxxxxxx Group, P.C. and Imowitz Xxxxxx
& Co. LLP, whose reports on the consolidated financial statements of the
Company and the Subsidiaries are incorporated by reference in the Registration
Statement and the Prospectus Documents, is an independent registered public
accountant as required by the Exchange Act and by the rules of the Public
Company Accounting Oversight Board.
12
AA. Knowledge. As
used in this Agreement, the terms “Company’s knowledge” or “knowledge of the
Company” or similar language means the knowledge of Xxx X. Xxxxx and Xxxx X.
Xxxxxxxxx, with the assumption that such individuals shall have made reasonable
and diligent inquiry of the matters presented.
4. Certain Covenants and
Agreements of the Company.
The
Company covenants and agrees with the Placement Agent as follows:
A. Amendments to Registration
Statement and Prospectus Documents. The Company will deliver
to the Placement Agent, prior to filing, any amendment or supplement to the
Registration Statement or Prospectus Documents proposed to be filed after the
Closing and not file any such amendment or supplement to which the Placement
Agent shall reasonably object in writing, provided that the Company may file
such amendment or supplement if it would render the Company in breach of the
Securities Act, the Exchange Act and any Rules and Regulations and the Placement
Agent has not suggested a form of amendment or supplement which would not be
objectionable.
B. Federal Securities
Laws.
(i) Compliance. During
the time when a prospectus is required to be delivered under the Securities Act,
the Company will comply with all requirements imposed upon it by the Securities
Act, the Rules and Regulations and the Exchange Act, as from time to time in
force, so far as necessary to permit the continuance of sales of or dealings in
the Securities in accordance with the provisions hereof and the Prospectus
Documents. If at any time when a prospectus relating to the
Securities is required to be delivered under the Securities Act, any event shall
have occurred as a result of which, in the opinion of counsel for the Company or
counsel for the Placement Agent, such prospectus, as then amended or
supplemented, includes an untrue statement of a material fact or omits 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, or if it is necessary at any time to amend any of the Prospectus
Documents to comply with the Securities Act, the Company will notify the
Placement Agent promptly and prepare and file with the Commission, subject to
Section 4(A) hereof, an appropriate amendment or supplement in accordance with
Section 10 of the Securities Act.
(ii) Exchange Act
Registration. For a period of three years from the Effective
Date, or until such earlier time upon which the Company is required to be
liquidated or enters into a merger (other than where the Company is the
surviving entity) or consolidation with or is otherwise sold to another
corporation or other entity, the Company will maintain the registration of the
Shares under the provisions of the Exchange Act. The Company will not
deregister the Shares under the Exchange Act without the prior written consent
of the Placement Agent.
13
(iii) Free Writing
Prospectuses. The Company represents and agrees that it has
not made and will not make any offer relating to the Securities that would
constitute an issuer free writing prospectus, as defined in Rule 433 of the
Securities Act, without the prior consent of the Placement Agent. Any
such free writing prospectus consented to by the Placement Agent is hereinafter
referred to as a “Permitted Free Writing Prospectus.” The Company
represents that it will treat each Permitted Free Writing Prospectus as an
“issuer free writing prospectus” as defined in Rule 433, and has complied and
will comply with the applicable requirements of Rule 433 of the Securities Act,
including timely Commission filing where required, legending and record
keeping.
C. Delivery to Placement Agent
of Offering Documents. The Company will deliver to the
Placement Agent, without charge, with as many copies of the Offering Documents
as the Placement Agent may reasonably request.
D. Listing of
Securities. The Company shall use its best efforts to cause
the Securities to meet the criteria necessary for inclusion of the Shares on the
NASDAQ and seek and use its commercially reasonable efforts to maintain such
listing for a period of at least three years after the Closing.
E. Application of Net
Proceeds. The Company will apply the net proceeds from the
Offering received by it in a manner consistent with the application described
under the caption “Use Of Proceeds” in the Prospectus Supplement.
F. Stabilization. Neither
the Company, nor, to its knowledge, any of its employees, directors or
shareholders (without the consent of the Placement Agent) has taken or will
take, directly or indirectly, any action designed to or that has constituted or
that might reasonably be expected to cause or result in, under the Exchange Act,
or otherwise, stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Shares.
G. Internal
Controls. The Company will maintain a system of internal
accounting controls sufficient to provide reasonable assurances
that: (i) transactions are executed in accordance with
management’s general or specific authorization; (ii) transactions are
recorded as necessary in order to permit preparation of financial statements in
accordance with GAAP and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management’s
general or specific authorization; and (iv) the recorded accountability for
assets is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
H. FINRA. The
Company shall advise the Placement Agent (who shall make an appropriate filing
with FINRA) if it is aware that any 5% or greater shareholder of the Company
becomes an affiliate or associated person of an FINRA member participating in
the distribution of the Company’s Securities.
I. No Fiduciary
Duties. The Company acknowledges and agrees that the Placement
Agent’s responsibility to the Company is solely contractual in nature and that
none of the Placement Agent or its affiliates or any selling agent shall be
deemed to be acting in a fiduciary capacity, or otherwise owes any fiduciary
duty to the Company or any of its affiliates in connection with the Offering and
the other transactions contemplated by this Agreement.
14
J. Reservation of Common
Stock. The Company shall keep available out of its authorized
and designated Common Stock, solely for the purpose of issuance upon the
exercise of the Warrants and Placement Agent Warrants, such number of Warrant
Shares and Placement Agent Shares.
K. Restrictions on Certain
Actions. For a period of three years following the Closing, the Company
will not take any action, or cause any action to be taken, that would cause a
holder of Warrants (or any group including such holder), by reason of such
holder’s exercise of such Warrants, to become an “Acquiring Person” under any
shareholder rights plans or agreement that may be adopted by the Company in the
future.
5. Indemnification.
A. Indemnification of the
Placement Agent. The Company agrees to indemnify and hold
harmless the Placement Agent, its affiliates, the directors, officers and
employees of the Placement Agent and their affiliates and subagents and selected
dealers, and each other person or entity, if any, controlling the Placement
Agent or any of its affiliates (collectively, “Indemnified Persons”), from and
against, and the Company agrees that no Indemnified Person shall have any
liability to the Company or its owners, parents, affiliates, securityholders or
creditors for, any losses, claims, damages, liabilities or expenses (including
actions, claims or proceedings in respect thereof (collectively, “Actions”)
brought by or against any person, including stockholders of the Company, and the
cost of any investigation and preparation therefore and defense thereof)
(collectively, “Losses”) related to or arising out of (i) any untrue statements
or omissions made in (a) the Offering Documents or any exhibit thereto, (b) any
materials or information provided to investors by, or with the approval of, the
Company in connection with the marketing of the offering of the Securities,
including any “road show” or investor presentations made to investors by the
Company (whether in person or electronically); or (c) any application or other
document or written communication executed by the Company or based upon written
information furnished by the Company in any jurisdiction in order to qualify the
Securities under the securities laws thereof or filed with the Commission, any
state securities commission or agency, NASDAQ or any securities exchange, (ii)
the services, commitment or other obligations undertaken or being considered by
the Placement Agent in this Agreement in connection with the sale of the
Securities in the Offering, and (iii) claims relating to any finders or
origination fees. The foregoing notwithstanding, such indemnification shall not
apply to the Losses of an Indemnified Person that are determined by a court of
competent jurisdiction in a final judgment not subject to appeal to have
resulted from the bad faith or gross negligence of such Indemnified Person or to
Losses arising out of a claim under this section as to an alleged omission from
or misstatement in the Offering Documents or any exhibit thereto if either (a)
at or prior to the execution of a Subscription Agreement the copy of the
Prospectus Supplement and exhibits were not sent or delivered to the subscriber
or (b) the alleged untrue statement was corrected or the omission of a material
fact alleged was contained in a supplement or amendment to the Prospectus
Supplement was delivered to the subscriber prior to the written acceptance of
the subscriber’s Subscription Agreement by the Company.
B. Indemnification of the
Company. The Placement Agent agrees to indemnify the Company
and its Subsidiaries, each of its executive officers and each of its directors
(the “Company Indemnified Parties”) from any Losses that may be incurred by any
Company Indemnified Party relating to any information provided by the Placement
Agent for use in the Prospectus Supplement, which information was specifically
provided to the Company by the Placement Agent in writing for the use in such
Prospectus Supplement.
15
C. Procedure. Promptly
after receipt by an Indemnified Person or a Company Indemnified Person (each an
“indemnified party”) under this Section 5 of notice of the commencement of any
action, such indemnified party will, if a claim in respect thereof is to be made
against any indemnifying party under this Section 5, notify in writing the
indemnifying party of the commencement thereof, however, that no delay on the
part of the indemnified party in notifying the indemnifying party shall relieve
the indemnifying party from any obligation hereunder unless the indemnifying
party is prejudiced by such delay. In case any such action is brought
against any indemnified party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent that it may wish, jointly with any other indemnifying
party, similarly notified, to assume the defense thereof, with counsel who shall
be to the reasonable satisfaction of such indemnified party, and after notice
from the indemnifying party to such indemnified party of its election so to
assume the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section 5 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
if, in the reasonable judgment of the indemnified party, it is advisable for the
indemnified party to be represented by separate counsel, the indemnified party
shall have the right to employ a single counsel to represent the indemnified
parties who may be subject to liability arising out of any claim in respect of
which indemnity may be sought by the indemnified parties thereof against the
indemnifying party, in which event the fees and expenses of such separate
counsel shall be borne by the indemnifying party. Any such
indemnifying party shall not be liable to any such indemnified party on account
of any settlement of any claim or action effected without the consent of such
indemnifying party which consent shall not be unreasonably
withheld.
D. Contribution. If
such an indemnity provided for in this Agreement is unavailable or insufficient
for any Indemnified Person with respect to any Losses, then the indemnifying
party, in lieu of indemnifying such Indemnified Person, will contribute to the
amount paid or payable by such Indemnified Person as a result of such Losses (i)
in such proportion as it is appropriate to reflect the relative benefits
received by the Company on the one hand, and the Placement Agent, on the other
hand, from the Offering, or (ii) if the allocation provided by (i) above is not
permitted by applicable law in such proportion as is appropriate to reflect not
only the relative benefits referred to in (i) above, but also the relative fault
on the Company, on the one hand, and of the Placement Agent on the other hand in
connection with statements or omissions that resulted in Losses as well as any
other relevant equitable considerations. The relative benefits
received by the Company on the one hand, and the Placement Agent, on the other
hand shall be deemed to be in the same proportion as the total proceeds from the
Offering (net of sales commissions, but before deducting other expenses)
received by the Company bear to the commissions received by the Placement
Agent. The relative fault of the Company, on the one hand, and the
Placement Agent, on the other hand, will be determined with reference to, among
other things, whether the untrue or alleged untrue statement of material fact or
the omission to state a material fact relates to the information supplied by the
Company, on the one hand, and the Placement Agent, on the other hand, and their
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
16
The
Company and the Placement Agent agree that it would not be just and equitable if
contribution pursuant to this section were determined by pro rata allocation or
by any other method of allocation that does not take into account the equitable
considerations referred to in the immediately preceding paragraph.
E. WAIVER OF JURY TRIAL. THE PLACEMENT
AGENT HEREBY AGREES AND THE COMPANY HEREBY AGREES, ON ITS OWN BEHALF AND ON
BEHALF OF ITS SECURITYHOLDERS, TO WAIVE ANY RIGHT TO TRIAL BY JURY WITH RESPECT
TO ANY CLAIM, COUNTER-CLAIM OR ACTION ARISING OUT OF PLACEMENT AGENT’ ROLE OR
THIS PLACEMENT AGENT AGREEMENT.
6. Payment of
Expenses.
Whether
or not the Offering is successfully completed, the Company hereby agrees to bear
all of its expenses in connection with the Offering, including, but not limited
to the following: (a)
all filing fees and communication expenses relating to the registration of the
Shares to be sold in the Offering with the Commission; (b) all COBRADesk filing
fees associated with the review of the Offering by FINRA and all fees and
expenses relating to the listing of such Shares on NASDAQ or on such other stock
exchanges as the Company and the Placement Agent together determine; (c) all
fees, expenses and disbursements relating to the registration or qualification
of such Shares under the “blue sky” securities laws of such states and other
jurisdictions as the Placement Agent may reasonably designate, if any; (d) all
fees, expenses and disbursements relating to the registration, qualification or
exemption of such Shares under the securities laws of such foreign jurisdictions
as the Placement Agent may reasonably designate, if any; (e) the costs of all
mailing and printing of the financing documents, Registration Statements,
prospectuses and all amendments, supplements and exhibits thereto and as many
preliminary and final prospectuses as the Placement Agent may reasonably deem
necessary; (f) the costs of preparing, printing and delivering certificates
representing the Shares and Warrants; (g) fees and expenses of the transfer
agent for the Common Stock; (h) the fees and expenses of the
Company’s accountants; (h) the fees and expenses of the Company’s and the
Placement Agent’s legal counsel and other agents and representatives; and (i)
travel, lodging and other similar costs and expenses associated with “road
shows” for the Company; provided, however that the Company shall reimburse the
Placement Agent up to a maximum of $50,000 for the full amount of its actual
accountable expenses incurred.
7. Conditions of the
Closing
Provided
the Offering shall have been subscribed for and funds representing such amount
thereof shall have cleared, the Closing shall be held at the offices of
Placement Agent’s counsel or such other place as mutually agreed upon by the
parties. The obligations of the Placement Agent hereunder shall be subject to
the continuing accuracy of the representations and warranties, in all material
respects, of the Company herein as of the date hereof and as of the Closing Date
as if such representations and warranties had been made on and as of such
Closing and the performance by the Company on and as of each Closing of its
covenants and obligations hereunder and to the following further
conditions:
A. Legal Opinion of Company’s
Counsel. At the Closing, the Placement Agent shall have
received the opinion of Xxxxx & Xxxxxxx LLP, counsel to the Company, dated
as of the Closing Date, in form and substance reasonably satisfactory to counsel
for the Placement Agent.
17
B. Access to
Information. At or prior to the Closing, counsel for Placement
Agent shall have been furnished such documents, certificates and opinions as it
may reasonably require for the purpose of enabling it to review or pass upon the
matters referred to in this Agreement and the Offering Documents, or in order to
evidence the accuracy, completeness or satisfaction of any of the
representations, warranties or conditions herein contained.
C. Accountants’ Comfort
Letters. At the time this Agreement is executed, and at the
Closing, the Placement Agent shall have received a letter, addressed to the
Placement Agent and in form and substance satisfactory in all respects to the
Placement Agent and its counsel from Xxxxxxx Group, P.C. and Imowitz Xxxxxx
& Co. LLP, dated, respectively, as of the date of this Agreement and as of
the Closing Date (i) confirming that they are independent public accountants
with respect to the Company within the meaning of the Securities Act and the
applicable Rules and Regulations and PCAOB and (ii) stating the conclusions and
findings of such firm, of the type ordinarily included in accountants’ “comfort
letters” to placement agents, with respect to the financial statements and
certain financial information contained or incorporated by reference in the
Registration Statement and the Prospectus Documents.
D. Officers’
Certificate. At the Closing, the Placement Agent shall have
received a certificate of the Company signed by the Chief Executive Officer of
the Company, dated on the Closing Date, to the effect that the Company has
performed all covenants and complied with all conditions required by this
Agreement to be performed or complied with by the Company prior to and as of the
Closing and that the conditions set forth in Section 7(F) hereof have been
satisfied as of such date and that, as of the Closing, the representations and
warranties of the Company set forth in Section 3 hereof are true and correct in
all material respects. In addition, the Placement Agent will have
received such other and further certificates of officers of the Company as the
Placement Agent may reasonably request.
E. Secretary’s
Certificate. At the Closing Date, the Placement Agent shall
have received a certificate of the Company signed by the Secretary or Assistant
Secretary of the Company, dated as of the Closing Date, certifying:
(i) that the Articles of Incorporation are true and complete, have not been
modified and are in full force and effect; (ii) that the resolutions of the
Company’s Board of Directors relating to the public offering contemplated by
this Agreement are in full force and effect and have not been modified; and
(iii) as to the incumbency of the officers of the Company. The
documents referred to in such certificate shall be attached to such
certificate.
F. No Material
Changes. Prior to the Closing (i) there shall have been
no Material Adverse Change from the latest dates as of which such condition is
set forth in the Registration Statement and Prospectus Documents; (ii) no
action suit or proceeding, at law or in equity, shall have been pending or, to
the Company’s knowledge, threatened against the Company or any director or
officer of the Company before or by any court or federal or state commission,
board or other administrative agency wherein an unfavorable decision, ruling or
finding may have a Material Adverse Effect, except as set forth in the
Registration Statement and Prospectus Documents; (iii) no stop order shall
have been issued under the Securities Act and no proceedings therefore shall
have been initiated or threatened by the Commission; and (iv) the
Registration Statement and the Prospectus Documents and any amendments or
supplements thereto shall conform in all material respects to the requirements
of the Securities Act and the Rules and Regulations, including, without
limitation, that the Registration Statement and the Prospectus Documents and any
amendments or supplements thereto shall contain all material statements which
are required to be stated therein in accordance with the Securities Act and the
Rules and Regulations, and neither the Registration Statement nor the Prospectus
Documents nor any amendment or supplement thereto shall 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.
18
G. No Stop
Order. No stop order suspending the sale of the Units shall
have been issued, and no proceedings for that purpose shall have been initiated
or threatened.
H. Trading
Market. The Company shall have filed a notification to list
the Shares with NASDAQ and shall have received no objection thereto from
NASDAQ.
I. Other Filings with the
Commission. The Company shall have prepared and filed with the
Commission a Current Report on Form 8−K with respect to the transactions
contemplated hereby, including as an exhibit thereto this Agreement and any
other documents relating thereto required to be filed with the
Commission.
J. Delivery of Shares and
Warrants. At the Closing, the Company shall have duly executed
and delivered the appropriate amount of Shares and Warrants to the respective
holders thereof, and shall have delivered the Placement Agent Warrants to the
Placement Agent.
K. Subscription
Agreements. The Company shall have entered into the
Subscription Agreements with each of the Investors, and such agreements shall be
in full force and effect on the Closing Date.
L. Additional
Documents. Prior to the Closing Date, the Company shall have
furnished to the Placement Agent such further information, certificates or
documents as the Placement Agent shall have reasonably requested.
8. Termination.
The
Placement Agent shall have the right to terminate this Agreement by giving
notice as hereinafter specified at any time at or prior to the Closing Date,
without liability on the part of the Placement Agent to the Company, if (A)
prior to delivery and payment for the Units (i) trading in securities generally
shall have been suspended on or by NASDAQ, (ii) trading in the Common Stock of
the Company shall have been suspended on any exchange by the Commission, (iii) a
general moratorium on commercial banking activities shall have been declared by
federal or New York state authorities or a material disruption shall have
occurred in commercial banking or securities settlement or clearance services in
the United States, (B) since the time of execution of this Agreement or the
earlier respective dates as of which information is given in the Prospectus
Supplement or incorporated by reference therein, there has been any Material
Adverse Change which is not described in the Prospectus Documents and is of such
character that in the reasonable judgment of the Placement Agent would,
individually or in the aggregate, result in a Material Adverse Effect and which
would, in the reasonable judgment of the Placement Agent, make it impracticable
or inadvisable to proceed with the Offering or the delivery of the Units on the
terms and in the manner contemplated in this Agreement and the Prospectus
Documents, (C) the Company shall have failed, refused or been unable to comply
with the terms or perform any agreement or obligation of this Agreement or any
Subscription Agreement, other than by reason of a default by the Placement
Agent, or (D) any condition of the Placement Agent’s obligations hereunder is
not fulfilled. Any such termination shall be without liability of any party to
any other party except that the Company will reimburse the Placement Agent for
all of their out−of−pocket expenses actually incurred by them in connection with
the Offering (as specified in Section 6) up to a maximum of $50,000, and that
the provisions of Section 5 and Section 9 hereof shall at all times be effective
notwithstanding such termination.
19
9. Miscellaneous.
A. Counterparts. 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.
B. Notice. 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, sent by overnight courier or
faxed, addressed as follows:
To the
Placement Agent:
Jesup
& Xxxxxx Securities Corp.
000
Xxxxxxxxxx Xx. 00xx Xxxxx
Xxx
Xxxxxxxxx, XX 00000
Fax: (000)
000-0000
Attention: Xxxx
Xxxxxxx
with a
copy to:
Xxxxxxxxxx
& Xxxxx LLP
00000
Xxxxxxxx Xxxx.
Xxxxx
000
Xxx
Xxxxxxx, XX 00000
Fax:
(000) 000-0000
Attention: Xxxxx
Xxxxxxxxxx, Esq.
to the
Company:
0000
Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxx,
Xxxxxxxx 00000
Fax:
(000) 000-0000
Attention: Xxxx
X. Xxxxxxxxx
with a
copy to:
Xxxxx
& Xxxxxxx LLP
000
Xxxxxxxxxx Xxxxxx, XX
Xxxxxxxxxx,
XX 00000
Fax:
(000) 000-0000
Attention: Xxxxxx
X. Xxxxxxx
or to
such other address of which written notice is given to the others.
20
C. Headings. The
headings contained herein are for the sole purpose of convenience of reference,
and shall not in any way limit or affect the meaning or interpretation of any of
the terms or provisions of this Agreement.
D. Governing Law. This
Agreement shall be governed by and construed in all respects under the laws of
the State of New York, 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 brought and prosecuted in any New York
State court sitting in the County of New York, New York and any Federal court
sitting in the Southern District of the State of New York. The
parties hereby irrevocably and unconditionally consent to the jurisdiction of
each such court or courts located within the State of New York 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.
E. Entire Agreement;
Amendment. This Agreement and the other agreements referenced
herein contain the entire understanding between the parties hereto with respect
to the subject Offering 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. The terms and conditions of any other agreement
between the Company and Placement Agent are hereby terminated.
F. Waiver,
etc. The failure of any of the parties hereto to at any time
enforce any of the provisions of this Agreement shall not be deemed or construed
to be a waiver of any such provision, nor to in any way effect the validity of
this Agreement or any provision hereof or the right of any of the parties hereto
to thereafter enforce each and every provision of this Agreement. No
waiver of any breach, non-compliance or non-fulfillment of any of the provisions
of this Agreement shall be effective unless set forth in a written instrument
executed by the party or parties against whom or which enforcement of such
waiver is sought; and no waiver of any such breach, non-compliance or
non-fulfillment shall be construed or deemed to be a waiver of any other or
subsequent breach, non-compliance or non-fulfillment.
G. Severability. 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.
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IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date
first written above.
| NEW GENERATION BIOFUELS HOLDINGS, INC. | |||
|
|
By:
|
/s/ Xxxx X. Xxxxxxxxx | |
| Name: Xxxx X. Xxxxxxxxx | |||
|
Title:
Chief Executive Officer and Chief Financial Officer
|
|||
| JESUP & XXXXXX SECURITIES CORP. | ||
|
By:
|
/s/ Xxxx Xxxxxxx | |
| Name: Xxxx Xxxxxxx | ||
| Title: Co-Head Investment Banking | ||
22
