BERMAN CENTER, INC. PLACEMENT AGENT AGREEMENT
Exhibit
10.23
XXXXXX
CENTER, INC.
Dated
as
of: October 6, 2006
Hunter
World Markets, Inc.
0000
Xxxxxxxx Xxxxxxxxx
Xxxxxxxxx
Xxxxx
Xxxxxxx
Xxxxx, XX 00000
Ladies
and Gentlemen:
The
undersigned, Xxxxxx Center, Inc. (the “Company”), hereby agrees with Hunter
World Markets, Inc. (“Hunter”, and with the Company, the “Parties”) as
follows:
1. Exclusive
Placement Agency.
The
Company hereby engages Hunter for a period of twenty-four (24) months from
the
date hereof (the “Term”) to act as its exclusive placement agent for potential
financing transactions on a “best efforts” basis involving the issuance and sale
of debt and/or equity securities (the “Securities”) by the Company (an
“Offering”), the type and dollar amount being as mutually agreed to by the
Parties.
Hunter
shall exercise good faith in its performance under this Agreement in obtaining
financing opportunities for the Company, but Hunter shall not be obligated
to
sell any securities under this Agreement and an Offering by Hunter shall be
solely on a “best efforts basis.”
The
Company shall generally have the responsibility to prepare a Private Placement
Memorandum (“PPM”), which shall not contain a materially misleading statement,
or omit to state a fact required to make the statement therein not misleading.
An Offering shall be conducted pursuant to Regulation D promulgated by the
Securities and Exchange Commission (the “SEC”) and shall be offered and sold
only to “Accredited Investors” as that term is defined in Regulation D. An
Offering is intended to qualify as a Regulation D, Rule 506 transaction. Other
than Hunter itself, no person, party or entity, including the Company, its
officers, directors, employees, agents, or attorneys, may distribute the Private
Placement Memorandum used in connection with the offering of the Securities,
in
any manner (including electronically) to any party, without the prior written
consent of Hunter.
2. Compensation.
As
compensation to Hunter for performance under this Agreement, the Company shall
issue to Hunter 800,000 shares of the Company’s Common Stock.
As
compensation for the Securities sold directly by Hunter in Offering, Hunter
will
receive compensation as mutually agreed by the Parties at the time of an
Offering, depending on the type and size of the Offering.
3. Exclusivity.
Hunter
shall act as the Company’s exclusive placement agent during the Term of this
Agreement. The Company may not solicit, engage or continue to work with any
underwriters, third party finders, brokers, or other consultants, during the
Term of this Agreement, without express written approval of Hunter. During
the
Term, the Company shall provide Hunter with the name and other pertinent
information on any potential investor before accepting such investment, however
the Company shall at all times retain sole discretion to accept such
investment.
4. Representations,
Warranties and Covenants of Hunter.
Hunter
represents, warrants and covenants as follows:
(a) Hunter
has the necessary power to enter into this Agreement and to consummate the
transactions contemplated hereby.
(b) The
execution and delivery by Hunter 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 Hunter is a party or by which Hunter or its properties are bound, or
any
judgment, decree, order or, to Hunter’s knowledge, any statute, rule or
regulation applicable to Hunter. This Agreement, when executed and delivered
by
Hunter, will constitute the legal, valid and binding obligations of Hunter,
enforceable in accordance with their respective terms, except to the extent
that
(i) 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, (ii) the enforceability
hereof or thereof is subject to general principles of equity, or (iii) the
indemnification provisions hereof or thereof may be held to violate public
policy.
(c) Hunter
will not deliver any documents related to an Offering to any person it does
not
reasonably believe to be an Accredited Investor based upon documentary evidence
thereof, where appropriate.
(d) Hunter
will not intentionally take any action that it reasonably believes would cause
an Offering to violate the provisions of the Securities Act of 1933, the
Securities Exchange Act of 1934, the respective rules and regulations
promulgated thereunder (the “Rules and Regulations”) or applicable “Blue Sky”
laws of any state or jurisdiction.
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(e) Hunter
shall use all reasonable efforts to determine (i) whether the Investor is an
Accredited Investor and (ii) that any information furnished by the Investor
is
true and accurate. Hunter shall have no obligation to insure that any check,
note, draft or other means of payment for the Securities will be honored, paid
or enforceable against the Investor in accordance with its terms.
(f) Hunter
is
a member of the NASD, and is a broker-dealer registered as such under the
Securities Exchange Act of 1934 and under the securities laws of the states
in
which the Securities will be offered or sold by Hunter, unless an exemption
for
such state registration is available to Hunter. Hunter is in compliance with
all
material rules and regulations applicable to Hunter generally and applicable
to
Hunter’s participation in an Offering.
(g) In
connection with Hunter's activities hereunder on the Company's behalf, the
Company shall furnish Hunter with all reasonable information concerning the
Company and its operations that Hunter deems necessary or appropriate (the
"Company Information") and shall provide Hunter with reasonable access to the
Company's books, records, officers, directors, employees, accountants and
counsel. Hunter agrees that the Company Information will be used solely for
the
purpose of performing its services hereunder. Hunter will keep the Company
Information provided hereunder confidential and will not disclose such Company
Information or any portion thereof, except in connection with the performance
under this Agreement. Hunter's confidentiality obligations under this Agreement
shall not apply to any portion of the Company Information which (i) at the
time
of disclosure to Hunter or thereafter is generally available to and known by
the
public (other than as a result of a disclosure directly or indirectly by Hunter
in violation of this Agreement); (ii) has been independently acquired or
developed by Hunter without violating any of its obligations under this
Agreement; or (iii) the disclosure of which is legally compelled (whether by
deposition, interrogatory, request for documents, subpoena, civil or
administrative investigative demand or other similar process). In the event
that
Hunter becomes legally compelled to disclose any of the Company Information,
Hunter shall provide the Company with prompt prior written notice of such
requirement so that the Company may seek a protective order or other appropriate
remedy and/or waive compliance with the terms of this Agreement. The obligations
of the Parties under this Section 4(g) shall survive the termination of this
Agreement for 12 months.
5. Representations
and Warranties of the Company.
The
Company represents and warrants as follows:
(a) The
execution, delivery and performance of this Agreement has been or will be duly
and validly authorized by the Company and will be, a valid and binding agreement
of the Company, enforceable in accordance with its respective terms, except
to
the extent that (i) 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, (ii) the
enforceability hereof or thereof is subject to general principles of equity
or
(iii) the indemnification provisions hereof or thereof may be held to violate
public policy.
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(b) 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.
(c)
The
Company is not aware of any federal or securities violations by any of its
current officers, directors or consultants, nor does the Company believe that
any of its officers, directors or consultants are or were the subject of any
enforcement proceedings by the Securities Exchange Commission or the National
Association of Securities Dealers.
(d) The
Company has been duly organized and is validly existing as a corporation the
laws of Delaware. The Company has all requisite 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 business (and proposed business), and
the
Company is doing business in compliance with all such authorizations, approvals,
orders, licenses, certificates and permits and all foreign, federal, state
and
local laws, rules and regulations concerning the business in which it is
engaged. The Company has all power and authority to enter into this Agreement,
to carry out the provisions and conditions hereof, and all consents,
authorizations, approvals and orders required in connection herewith 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 except for applicable federal and state securities laws.
(e) 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 credit
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 (other
than the obligation to hold annual meetings of its shareholders and related
matters) or in violation of any franchise, license, permit, judgment, decree
or
order, or in violation of any statute, rule or regulation.
(f) 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 and to the best of the Company’s knowledge 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 except
any claim or action that would not have a material adverse effect on the
Company; to the best of the Company’s knowledge, the Company’s current products,
services or processes do not infringe or will not infringe on the patents
currently held by any third party.
6. Certain
Covenants and Agreements of the Company.
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The
Company covenants and agrees at its expense and without any expense to Hunter
as
follows:
(a) To
advise
Hunter prior of any material adverse change in the Company’s financial
condition, prospects or business or of any development materially affecting
the
Company occurring at any time prior to the closing of any contemplated
Offering.
(b) 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.
(c) To
cooperate with Hunter as to permit an Offering to be conducted in a manner
consistent with the applicable state and federal securities.
(d) To
not
cause or knowingly permit any action to be taken in connection with a proposed
Offering which violates the Securities Act of 1933 or any State securities
laws.
7. Indemnification.
(a) The
Company hereby agrees that it will indemnify and hold Hunter and each officer,
director, shareholder, employee, attorneys, accountants, agents or
representative of Hunter, and each person controlling, controlled by or under
common control with Hunter within the meaning of Section 15 of the Securities
Act of 1933 or Section 20 of the Securities Exchange Act of 1934 or the SEC’s
rules and regulations promulgated thereunder (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 including attorneys’ fees in the event of a
breach of this representation and warranty) to which Hunter or such indemnified
person of Hunter may become subject under the Securities Act of 1933, the
Securities Exchange Act of 1934, 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) this Agreement, (b) any written offering material prepared
by
the Company including a PPM (except those written statements relating to Hunter
given by an indemnified person 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 Securities 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 Section 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
Hunter or such indemnified person as a direct result of Hunter or such person’s
gross negligence or willful misfeasance will be promptly repaid to the
Company.
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(b) Hunter
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 Securities Act of 1933 or Section 20
of
the Securities Exchange Act of 1934 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 Securities Act of 1933, the Securities Exchange Act
of
1934, 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 Hunter or its officers, employees or representatives in acting as
placement agent for an Offering or (ii) the breach of any representation,
warranty, covenant or agreement made by Hunter in this Agreement.
(c) Promptly
after receipt by an indemnified party of notice of commencement of any action
covered by Section 7(a) or 7(b), the party to be indemnified shall, within
five
(5) business days, notify the indemnifying party of the commencement thereof;
the omission by one 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) or 7(b)
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.
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(d)
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 Hunter 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 Hunter 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 Hunter
and the Company shall be responsible for the balance; provided, however, that
no
person guilty of fraudulent misrepresentation within the meaning of Section
7(f)
of the Securities Act of 1933 shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. For purposes of this
Section 7(d), any person controlling, controlled by or under common control
with
Hunter, or any partner, director, officer, employee, representative or any
agent
of any thereof, shall have the same rights to contribution as Hunter and each
person controlling, controlled by or under common control with the Company
within the meaning of Section 15 of the Securities Act of 1933 or Section 20
of
the Securities Exchange Act of 1934 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. 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. Notwithstanding anything to the contrary in this Section
7,
no party shall be liable for contribution with respect to the settlement of
any
claim or action effected without its written consent.
8. Non-Circumvention.
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Pursuant
to this Agreement, it is contemplated that Hunter shall supply to the Company
and its officers and directors prior to an Offering a certified list (the
“Certified List”) of investors and customers that Hunter will have contacted in
connection with a proposed Offering. If, during the twelve month period after
the commencement of such Offering, the Company completes a Transaction (as
defined below) with a person on the Certified List, the Company shall pay Hunter
concurrently with the closing of such Transaction the compensation at a fair
market value rate for procuring the investment for such person.
“Transaction”
shall be defined as any direct or indirect sale, transfer, conveyance, exchange,
financing, investment, trade, exchange or other change in legal or beneficial
ownership of any property, whether accomplished by an issuance or purchase
of
assets of securities, merger, consolidation, management contract, joint venture,
partnership, trade or exchange of assets or stock or otherwise.
9. Miscellaneous.
(a) 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) 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, addressed as
follows:
To
Hunter:
Hunter
World Markets, Inc.
0000
Xxxxxxxx Xxxxxxxxx
Xxxxxxxxx
Xxxxx
Xxxxxxx
Xxxxx, XX 00000
Attention:
Xxxx Xxxxxx
Telephone:
(000) 000-0000
Fax:
(000) 000-0000
To
the
Company:
Xxxxxx
Center, Inc.
000
Xxxx
Xxxxxxx
Xxxxx
000
Xxxxxxx,
XX 00000
Attention:
Xxxxxx Xxxxxxx
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
with
a
copy to:
Xxxxxxxxxxx
& Xxxxxxxx Xxxxxxxxx Xxxxxx LLP
00000
Xxxxx Xxxxxx Xxxx., Xxxxx 000
Xxx
Xxxxxxx, XX 00000
Attention:
Xxxxx Xxxxxx
Telephone:
000-000-0000
Fax:
000-000-0000
or
to
such other address of which written notice is given to the
others.
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(c) This
Agreement shall be construed pursuant to the laws of the State of California
without regard to conflicts of law principals thereof. Any controversy arising
hereunder shall be resolved by arbitration from the American Arbitration
Association.
(d) This
Agreement contains 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.
(e) 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.
[Signature
Page to Follow]
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IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date
first written above.
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XXXXXX
CENTER, INC.
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/s/
Xxxxxx Xxxxxxx
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By:
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Xxxxxx
Xxxxxxx
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Its:
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Chief
Executive Officer
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AGREED
AND ACCEPTED
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HUNTER
WORLD MARKETS, INC.
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/s/
Xxxx Xxxxxx
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By:
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Xxxx
Xxxxxx
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Its:
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President
and CEO
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