ATHENA CAPITAL PARTNERS, INC. LETTER HEAD
CONFIDENTIAL
April 10, 2003
Mr. Xxxxxxx Xxxxxxx, CEO and
Xxxxxx Xxxxx, M.D., Ph.D., Chairman
DNAPrint Genomics 000 Xxxxxxxx
Xxxxxx Xxxxxxxx, XX 00000
Gentlemen:
This letter agreement (the "Agreement") shall confirm the engagement of
Athena Capital Partners, Inc. ("Athena") by DNAPrint Genomics (the "Company") as
the Company's exclusive investment banking agent to:
1. Arrange and negotiate a private placement of securities, issued by the
Company and/or any of its subsidiaries or affiliates, in the form of
common stock, convertible preferred stock, convertible debt, debt with
warrants, or any other equity-linked securities (the "Securities"). The
current plans are to raise $2.0 to $3.0 million at a pre-money
valuation of $10.0 to $15.0 million.
2. Obtain grant money from various governmental entities. The current plan
is raise $500,000 to $1.0 million.
3. Provide advisory services related to merger & acquisition activity, as
requested by the Company.
The above-mentioned services are subject to the following terms and conditions:
1. Exclusive Authorization. Subject to the terms and conditions of this
Agreement, the Company hereby appoints Xxxxxx to act on a best efforts basis as
its exclusive agent (except as it relates to the co-management relationship
discussed in paragraph 7 and the public sale of registered securities discussed
in paragraph 8) during the Authorization Period (as hereinafter defined) in all
the Company's investment banking activities, including the effort to privately
place the Securities (the "Transaction") in an amount and on terms and
conditions satisfactory to the Company. Xxxxxx hereby accepts such agency and
agrees on the terms of this Agreement to use its best efforts during
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the Authorization Period to arrange the sale of the Securities through such a
private placement to potential investors (the "Investors"). The Company
understands that Xxxxxx shall not have any obligation hereunder to purchase any
of the Securities or to provide financing of any kind to the Company. In
addition, the Company agrees that it will not hold Xxxxxx liable or responsible
in the event that the Transaction is not consummated for any reason whatsoever,
including, but not limited to, an adverse change in the financial or security
markets, insufficient demand for instruments similar to the Securities, or a
lack of interest by Investors in the Transaction. During the Authorization
Period, the Company shall be prohibited from (i) directly or indirectly offering
any of the Securities (or instruments substantially similar to the Securities)
for sale to, or soliciting any offer to purchase any of the Securities (or
instruments substantially similar to the Securities) from, or otherwise
contacting, approaching or negotiating with respect thereto with, any person,
and (ii) authorizing anyone other than Xxxxxx to act on its behalf to place the
Securities (or instruments substantially similar to the Securities). The Company
shall promptly refer to Athena all offers, inquiries and proposals relating to
any placement of the Securities (or instruments substantially similar to the
Securities) made to the Company at any time during the Authorization Period.
2. Authorization Period. Xxxxxx's engagement hereunder shall become
effective on the date this engagement letter is executed (the "Execution Date")
and, unless earlier terminated or extended in writing by the Company and/or
Athena, shall expire in twelve (12) months from the Execution Date (the
"Termination Date"; the period from the Execution Date through the Termination
Date being hereinafter referred to as the "Authorization Period").
3. Offering Materials. In connection with its engagement hereunder, the
Company shall prepare a Confidential Offering Materials, and such amendments or
supplements thereto as the Company may reasonably deem to be necessary or
appropriate to effectuate the sale of the Securities (the Confidential Offering
Material, as the same may be amended or supplemented from time to time, is
referred to herein as the "Offering Materials") and Xxxxxx shall cooperate and
assist the Company in the preparation of the Offering Materials, which shall
include: a business plan, comparable analysis, valuation analysis, etc. Prior to
any distribution thereof, the Offering Materials shall be subject to Xxxxxx's
and the Company's review and approval.
4. Fees and Disbursements.
(a) As compensation for Xxxxxx's services hereunder, the Company shall
pay Athena fees and issue and deliver warrants to Athena as follows:
(i) upon the execution of this Agreement, a retainer, payable in
warrants of the Company (no cash), in such amount that
represents $80,000 of the value of the Company (determined by
a 20 day moving average). This Retainer shall be
non-refundable, except as described below. Upon a closing of a
Transaction, one-half of the value of the Retainer (i.e.
warrants representing $40,000 in value) shall be credited
against the warrant portion of the fees payable to Athena
pursuant to subparagraph 4(a)(iii) below;
(ii) upon the closing of a Transaction, a transaction fee (the
"Transaction Fee") payable in cash to Athena in an amount
equal to 6% of the Aggregate
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Consideration (as defined below) paid for the Securities by
Investors; provided, however, that the Transaction Fee shall
be an amount not less than, in any circumstance, $165,000 (the
"Minimum Fee"). If the Aggregate Consideration is less than
$1.0 million then the Minimum Fee shall be 16.5% of the
Aggregate Consideration; and
(iii) upon the closing of a Transaction, the Company shall issue to
Athena warrants for a nominal price to purchase such number of
shares of the common stock of the Company equal to 4% of the
Aggregate Consideration (as defined below) paid for the
Securities by Investors, which warrants would be exercisable
for a period of five (5) years from the date of such closing,
at an exercise price per share equal to that paid by Investors
in the Transaction. The terms of the warrants shall be set
forth in a warrant agreement in form and substance
satisfactory to Athena and the Company, which shall contain
terms substantially identical to those applicable to the
Securities issued to Investors in the Transaction, including,
without limitation, anti-dilution provisions, registration
rights, and cashless exercise. The Company, at its option, may
elect to pay this portion of the fee in cash instead of
warrants.
(iv) upon the receipt of grant money (as discussed in item 2 of the
introductory paragraph of this engagement letter), the Company
shall issue to Athena warrants for a nominal price to purchase
such number of shares of the common stock of the Company equal
to $35,000 of the value of the Company, which warrants would
be exercisable for a period of five (5) years from the date of
such closing, at an exercise price per share equal to that
paid by Investors in the Transaction. The terms of the
warrants shall be set forth in a warrant agreement in form and
substance satisfactory to Athena and the Company, which shall
contain terms substantially identical to those applicable to
the Securities issued to Investors in the Transaction,
including, without limitation, anti-dilution provisions and
registration rights.
(v) fees for merger & acquisition advisory services will include a
monthly retainer plus a success fee equal to a percentage of
the "Transaction Value". For purposes of this Agreement the
Transaction Value shall mean the market value of the stock of
the target plus the book value of the target's debt (the
target's enterprise value). Xxxxxx and the Company will
negotiate in good faith to arrive at a reasonable fee.
(vi) Fees for the public sale of registered securities during the
Authorization Period, are discussed in paragraph 8 below.
(b) In addition to the fees payable to Xxxxxx hereunder and regardless
of whether the sale of any of the Securities is consummated, the Company shall
reimburse Athena, upon request made from time to time, for all of Xxxxxx's
out-of-pocket expenses incurred in connection with this engagement, including
the fees, disbursements and other charges of Xxxxxx's legal
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counsel. The Company acknowledges that Athena has a monthly administrative
charge (the administrative charge includes small dollar charges for items such
as long distance telephone calls, regular mail postage, photocopies, etc. It
does not include charges such as fedex charges or charges for operator assisted
conference calls) of $200, in addition to specific direct reimbursable charges.
All expenses greater than $500 per month will be pre-approved by Company.
(c) The Company shall pay to Athena all fees and issue and deliver
warrants to Xxxxxx as described in Section 4 of this Agreement in the event that
at any time prior to the expiration of 12 months after the Termination Date any
of the Securities (or instruments substantially similar to the Securities) are
sold to any Investor identified and/or contacted during the Authorization
Period.
(d) The Company shall pay to Athena all fees and issue and deliver
warrants to Xxxxxx as described in Section 4 of this Agreement in the event that
at any time prior to the expiration of 12 months after the Termination Date
substantially all of the assets of the Company are sold to any Investor
identified and/or contacted during the Authorization Period.
(e) If a Transaction has been consummated and one or more Additional
Transactions (for purposes of this Agreement "Additional Transactions" shall
mean the sale of securities other than the Securities contemplated in this
engagement letter) are consummated by the Company (or any affiliate or
subsidiary thereof) within 12 months from the closing date of the initial
Transaction with any Investor identified and/or contacted during the
Authorization Period, Xxxxxx shall be entitled to receive (i) an additional fee
(the "Additional Fee") in an amount equal to 6% of the Aggregate Consideration
paid by the Investors in connection with any such Additional Transactions,
payable in cash upon the closing of any such Additional Transactions and (ii)
warrants equal to 4% of the Aggregate Consideration paid by the Investors in
such Additional Transactions, issuable and deliverable to Athena upon the
closing of any such Additional Transactions. Such warrants shall be exercisable
for a period of five years from the date of such closing, at an exercise price
per share equal to that paid by the Investors in the Additional Transactions.
The terms of the warrants shall be set forth in a warrant agreement in form and
substance satisfactory to Athena and the Company, which shall contain terms
substantially identical to those applicable to the Securities issued to
Investors in the Transaction, including, without limitation, anti-dilution
provisions, registration rights, and cashless exercise.
(f) The definition of "Aggregate Consideration" for purposes of
calculating Athena's fee shall be deemed to include the cumulative fair market
value of all cash and other consideration paid for the Securities (or
instruments substantially similar to the Securities) by the Investors during the
Authorization Period, as well as any amounts paid in escrow and amounts payable
in the future. The fair market value of any non-cash consideration will be the
value determined by the Company and Athena at or prior to the date of the
applicable Transaction. The portion of Xxxxxx's fee relating to any future
payments shall be calculated and paid when and as such future payments are made;
provided, however, that the Minimum Fee payable to Athena pursuant to this
paragraph 4 shall be as described in paragraph 4 regardless of the timing of
future payments, if any.
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(g) All fees described above, and the reimbursement of Xxxxxx's
out-of-pocket expenses are payable by the Company as outlined above. The Company
will pay Athena, at a rate equal to twelve percent (12%) per year, a monthly
late payment charge (the "Late Payment Charge") on the unpaid balance of any
fees or expenses not timely paid in full. With respect to any unpaid portion of
the Transaction Fee or the Additional Fee, the Late Payment Charge will be
computed from the date of the closing of the Transaction or the Additional
Transaction, as applicable, until payment in full with respect to the unpaid
portion of any of Xxxxxx's out-of-pocket expenses, the Late Payment charge will
be computed from thirty (30) days after the issuance of Xxxxxx's invoice until
payment in full of such out-of-pocket expenses.
5. Representations and Covenants. The Company represents and covenants as
follows:
(a) The Company shall make available to Athena and/or shall agree to
have professionally prepared at the Company's expense, all financial statements,
projections, appraisals, surveys, title abstracts, performance summaries and
other information which, by mutual agreement, shall be necessary or appropriate
for the proper marketing of the Securities and the completion of the financing
contemplated hereby.
(b) During the Authorization Period, the Company shall not use,
distribute or refer to any Offering Materials (as hereinafter defined) without
mutual prior consent, except for internal use among the Company's personnel and
representatives and disclosure for the Securities and Exchange Commission.
(c) All materials to be given to any potential investor in connection
with the offering or placement of the Securities shall be approved by both the
Company and Athena (all such materials, as so approved, together with the
Offering Materials, being referred to herein as the "Offering Material"). The
Company represents, warrants and agrees that the Offering Material as of the
date thereof was, and will be as of the closing date of each sale of Securities
(a "Closing Date"), true, complete and correct in all material respects and does
not, and will not, contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to
make the statements contained therein not misleading. The Company shall advise
Xxxxxx immediately of the occurrence of any event or other change which results
in the Offering Material containing an untrue statement of a material fact or
omitting to state a material fact required to be stated therein or necessary to
make the statements contained therein not misleading. The Company recognizes and
confirms that Xxxxxx (i) will be using and relying primarily on the information
in the Offering Material and information available from generally recognized
public sources in performing the services contemplated hereunder without having
independently verified the same, (ii) does not assume responsibility for the
accuracy or completeness of such information or of the Offering Material and
(iii) will not make any appraisal of any assets of the Company. The Company will
cause to be furnished to Athena, at each closing of the sale of the Securities,
copies of "comfort" letters to be furnished to the purchasers of the Securities
on each Closing Date. Any letters provided to any party in connection with the
sale of the Securities and such letters as counsel to Xxxxxx may reasonably
request and the Company agrees are reasonable, dated the date of such closing,
in form and substance satisfactory to Xxxxxx.
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(d) The Company shall give Xxxxxx or will cause to be given Athena (i)
copies of the Company's annual reports and other financial reports at the
earliest time that such reports are made available to others, (ii) notice of any
material development affecting the Company, (iii) copies of all filings made by
the Company with the Securities and Exchange Commission, (iv) such other
information concerning the business and financial condition of the Company as
Xxxxxx may from time to time reasonably request and (v) access to the Company's
officers, directors, accountants, counsel and other advisors. Xxxxxx will obtain
approval from the Company's CEO and/or Chairman prior to contacting any of the
aforementioned advisors. In addition, the Company will, so long as any of the
Securities remain outstanding, furnish directly to Xxxxxx a copy of each
communication which is sent to the holders of the Securities as promptly as
practicable after the same is sent to them.
(e) If any Securities are to be offered or sold outside of the United
States, prior to the distribution of any Offering Material, the Company shall
cause its counsel to (i) prepare and deliver to Athena an International
Securities Law Memorandum addressing securities laws and certain other issues
requested by Xxxxxx, and (ii) prepare and file all applicable filings or
registrations in the jurisdictions outside of the United States identified by
Xxxxxx, if any are required. The International Securities Law Memorandum shall
contain, among other things, the jurisdictions in which the Securities have been
qualified for offer and sale or in which Securities may be offered and sold
without prior governmental qualifications, as the case may be.
(f) Upon each closing of a Transaction and an Additional Transaction,
the Company shall cause its counsel to prepare and file a Form D with the
Securities and Exchange Commission pursuant to Regulation D under the Securities
Act of 1933 together with all applicable state securities or "blue sky" filings
or registrations.
(g) As a further inducement to Xxxxxx for accepting this engagement,
the Company agrees (assuming the successful completion of the private placement
discussed above) that for a period of 12 months after the termination of this
engagement, the Company shall notify Athena of any plans the Company may have to
consummate any (1) acquisition with respect to which the Company will engage a
financial advisor, (2) disposition for which the Company will engage a financial
advisor, (3) private placement of securities (other than the Transaction
governed by this Agreement), or (4) public offering of securities, and shall
grant to Xxxxxx the opportunity to act as exclusive financial advisor, lead
placement agent or managing underwriter in connection with any of the foregoing,
as the case may be, at fees and/or discounts which are mutually acceptable to
the Company and Athena; provided, however, that if Athena indicates that it is
willing to act as exclusive financial advisor, lead placement agent or managing
underwriter in connection with any of the foregoing, but Athena and the Company
are unable to agree upon an acceptable fee and/or discount, the Company may
engage any other appropriate financial institution to act as exclusive financial
advisor, lead placement agent or managing underwriter in connection therewith,
but only if (a) the fees payable to such other institution or the underwriting
discount which would be earned by such other institution, will be less than
those which Xxxxxx indicated it would accept, and (b) prior to engaging such
other financial institution, the Company offers Xxxxxx the opportunity to act as
exclusive financial advisor, lead placement agent or managing underwriter, as
the case may be, on the same financial terms that such other financial
institution had agreed to accept. The forgoing notwithstanding, under no
circumstances shall Xxxxxx be obligated to accept any offer to act as the
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Company's advisor, placement agent or underwriter, and nothing contained herein
shall constitute the agreement of Athena to so act.
(h) The Company agrees that during the Authorization Period, the
Company shall notify Athena of any plans the Company may have to consummate a
Sale Transaction (as defined below) in lieu of the Transaction, and shall grant
to Athena the opportunity to act as exclusive financial advisor in connection
with such Sale Transaction at the equivalent Transaction Fees provide herein as
used in this Agreement, the term "Sale Transaction" means, whether effected in
one transaction or a series of transactions: (a) any merger, consolidation,
reorganization or other business combination pursuant to which the business of
the Company is combined with that of another party or (b) the acquisition,
directly or indirectly, by any of the capital stock or assets of the Company by
way of a negotiated purchase or otherwise, or (c) any sale of substantially all
of the assets of the Company.
(i) The Company represents, warrants and agrees that, except as
required by law or legal process, it will keep confidential, and will not
disclose to any third party, (i) the amount of the Transaction Fee, the
Additional Fee, and any other fees and expenses contemplated by this Agreement,
and (ii) the identities of the Investors identified or contacted by Xxxxxx.
6. Indemnification.
(a) Xxxxxx shall be indemnified and held harmless by the Company
against any losses, claims, damages or liabilities ("Claims") to which Xxxxxx
may become subject in connection with this Engagement. The Company will also
reimburse Athena for its expenses (including fees and expenses of legal counsel)
as such expenses are incurred in connection with investigating or defending such
Claims. However, the Company will not be obligated under this indemnity if it is
finally determined that such Claims arose out of the gross negligence or willful
misconduct of Xxxxxx. The reimbursement and indemnity obligations under this
paragraph shall be in addition to any liability the Company may otherwise have,
shall extend upon the same terms and conditions to the officers, directors,
members and employees of Athena, and shall be binding upon and inure to the
benefit of the parties and their respective successors and assigns.
(b) The Company shall be indemnified and held harmless by Xxxxxx
against any Claims, other than fees and expenses discussed in Section 4 above,
to which the Company may become subject in connection with this Engagement.
Xxxxxx will also reimburse the Company for its expenses (including fees and
expenses of legal counsel) as such expenses are incurred in connection with
investigating or defending such Claims. However, Xxxxxx will not be obligated
under this indemnity if it is finally determined that such Claims arose out of
the gross negligence or willful misconduct of the Company. The reimbursement and
indemnity obligations under this paragraph shall be in addition to any liability
Athena may otherwise have, shall extend upon the same terms and conditions to
the officers, directors, members and employees of the Company, and shall be
binding upon and inure to the benefit of the parties and their respective
successors and assigns.
(c) In the event Athena is requested or authorized by the Company or
required by government regulation, subpoena, or other legal process to produce
documents or personnel as
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witnesses with respect to Xxxxxx's services for the Company, the Company will,
so long as it is not a party to the proceeding in which information is sought,
reimburse Athena for its professional time and expenses, as well as the fees and
expenses of Xxxxxx's counsel, incurred in responding to such requests.
(d) Any controversy or claim arising out of or relating to this
Agreement or the services provided by Athena pursuant hereto (including any such
matter involving any parent subsidiary, affiliate, successor in interest, or
agent of the Company or of Athena) shall be submitted first to voluntary
mediation, and if mediation is not successful, then to binding arbitration in
accordance with the dispute resolution procedures set forth in Attachment 1.
Judgment on any arbitration award may be entered in any court having proper
jurisdiction.
(e) In no event, regardless of the legal theory advanced, shall Athena
be liable or responsible to any person or entity including, but not limited to,
the Company other than for its gross negligence or willful misconduct and any
such liability shall be limited to the amount actually paid by the Company under
this Agreement. Neither party shall be liable to the other for consequential,
incidental, indirect, punitive or special damages (including loss of profits,
data, business or goodwill), regardless of the legal theory advanced or of any
notice given as to the likelihood of such damages, provided that this sentence
shall not apply to any such damages subject to indemnification under section 6.
The Company's recourse with respect to any liability or obligation of Athena
hereunder shall be limited to the assets of Athena, and the Company shall have
no recourse against, and shall bring no claim against, any director, officer or
employee of Athena or any of the assets thereof. Similarly, Xxxxxx's recourse
with respect to any liability or obligation of the Company hereunder shall be
limited to the assets of the Company, and Xxxxxx shall have no recourse against
and shall bring no claim against, any director, officer or employee of the
Company or any of the assets thereof.
7. Co-Management. Xxxxxx has negotiated a co-management arrangement
with Sema4, Inc. with respect to the targets identified by Sema4, Inc. (targets
will be listed in an Exhibit A which shall be made a part this Agreement.
Exhibit A shall be completed after this agreement between Athena and the Company
has been executed and in connection with a separate letter of agreement between
Xxxxxx and Sema4, Inc. Sema4, Inc. has indicated they have three (3) targets
that will appear on Exhibit A). Such arrangement would call for a sharing of the
fee described in paragraph 4 between Xxxxxx and Xxxxxxxxx. The current agreement
is that such fee will be shared 50/50 between Xxxxxx and Sema4, Inc.
8. Public Sale of Registered Securities. The Company shall retain the
right to sell up to $1.2 million of registered shares to the public during the
Authorization Period. (The stated purpose of sales is to generate sufficient
cash to cover operating expenses prior to closing the private placement
discussed above.) Xxxxxx agrees that such sales will not violate the Exclusive
Authorization provisions described in paragraph 1 above. The Company agrees that
it will not unreasonably withhold its acceptance of funds raised in the private
placement in the amounts and for the fees described above. Furthermore, the
Company agrees to compensate Xxxxxx (for value received from Xxxxxx's services
that will benefit the public sales) at the rate of 2.083% of the amount raised
up to a maximum of $25,000. Such amount shall be in addition to the fees
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discussed in paragraph 4 above and will be nonrefundable. Such fees shall be
creditable against termination fees discussed in paragraph 9 below.
9. Miscellaneous. Xxxxxx's engagement hereunder may be terminated by
either the Company or Athena at any time upon written notice to that effect to
the other party, it being understood that the provisions hereof relating to the
payment of fees and expenses, the right to receive warrants and indemnification
and contribution and the right of first refusal with respect to certain future
transactions that may be undertaken by the Company will survive any termination,
expiration or supersession of this Agreement. Additionally, if the Company
terminates the Agreement prior to the end of the original Authorization Period,
the Company agrees to pay Xxxxxx the sum of $50,000 in recognition of the
services provide to date.
THIS AGREEMENT WILL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF FLORIDA APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY IN SUCH STATE.
EACH OF THE COMPANY AND XXXXXX AGREE THAT ANY ACTION OR PROCEEDING
BASED HEREON, OR ARISING OUT OF XXXXXX'S ENGAGEMENT HEREUNDER, SHALL BE BROUGHT
AND MAINTAINED EXCLUSIVELY IN THE COURTS OF THE STATE OF FLORIDA LOCATED IN THE
CITY AND COUNTY OF HILLSBOROUGH OR IN THE UNITED STATES DISTRICT COURT FOR THE
MIDDLE DISTRICT OF FLORIDA. THE COMPANY AND ATHENA EACH HEREBY IRREVOCABLY
SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF FLORIDA LOCATED IN THE
CITY AND COUNTY OF HILLSBOROUGH OR IN THE UNITED STATES DISTRICT COURT FOR THE
MIDDLE DISTRICT OF FLORIDA FOR THE PURPOSE OF ANY SUCH ACTION OR PROCEEDING AS
SET FORTH ABOVE AND IRREVOCABLY AGREE TO BE BOUND BY ANY JUDGMENT RENDERED
THEREBY IN CONNECTION WITH SUCH ACTION OR PROCEEDING. EACH OF THE COMPANY AND
ATHENA HEREBY IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY
SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY
CLAIM THAT ANY SUCH ACTION OR PROCEEDING HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.
The Company (for itself, anyone claiming through it or in its name, and
on behalf of its equity holders) and Athena each hereby irrevocably waive any
right they may have to a trial by jury in respect of any claim based upon or
arising out of this Agreement or the transactions contemplated hereby. This
Agreement may not be assigned by either party without the prior written consent
of the other party.
It is understood that Xxxxxx is being engaged hereunder solely to
provide the services described above to the Company and that Xxxxxx is not
acting as an agent or fiduciary of, and shall have no duties or liabilities to,
the equity holders of the Company or any third party in connection with its
engagement hereunder, all of which are hereby expressly waived.
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This Agreement (including the attached Indemnification Agreement)
embodies the entire agreement and understanding between the parties hereto and
supersedes all prior agreements and understandings relating to the subject
matter hereof. This Agreement may not be amended or otherwise modified or waived
except by an instrument in writing signed by both Athena and the Company. If any
provision of this Agreement is determined to be invalid or unenforceable in any
respect, such determination will not effect such provision in any other respect
or any other provision of this Agreement, which will remain in full force and
effect.
Please confirm that the foregoing correctly sets forth our agreement by signing
and returning to Athena the enclosed duplicate copy of this Agreement.
Very truly yours,
ATHENA CAPITAL PARTNERS, INC.
By: /s/ Xxxx X. Xxxxx
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Xxxx X. Xxxxx, CFA
President
THIS AGREEMENT CONTAINS A PRE-DISPUTE ARBITRATION CLAUSE LOCATED IN PARAGRAPH 6
ENTITLED "INDEMNIFICATION".
Accepted and Agreed to as of the date first written above:
DNAPRINT GENOMICS
Signature Title
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Print Name Date
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ATTACHMENT 1
DISPUTE RESOLUTION PROCEDURES
The following procedures shall be used to resolve any controversy or claim
("dispute") as provided in our agreement dated March 31, 2003(the "Agreement").
If any of these provisions are determined to be invalid or unenforceable, the
remaining provisions shall remain in effect and binding on the parties to the
fullest extent permitted by law.
MEDIATION
A dispute shall be submitted to mediation by written notice to the other party
or parties. In the mediation process, the parties will try to resolve their
differences voluntarily with the aid of an impartial mediator, who will attempt
to facilitate negotiations. The mediator will be selected by agreement of the
parties. If the parties cannot otherwise agree on a mediator, one will be
appointed by the American Arbitration Association ("AAA"). However, any mediator
appointed by the AAA must be acceptable to all parties.
The mediation will be conducted as specified by the mediator and agreed upon by
the parties. The parties agree to discuss their differences in good faith and to
attempt, with the assistance of the mediator, to reach an amicable resolution of
the dispute.
The mediation will be treated as a settlement discussion and therefore will be
confidential. The mediator may not testify for either party in any later
proceeding relating to the dispute. No recording or transcript shall be made of
the mediation proceedings.
Each party will bear its own costs in the mediation. The fees and expenses of
the mediator will be shared equally by the parties.
ARBITRATION
If a dispute has not been resolved within 90 days after the written notice
beginning the mediation process (or a longer period, if the parties agree to
extend the mediation), the mediation shall terminate and the dispute will be
settled by arbitration. The arbitration will be conducted in accordance with the
procedures in this document and the Arbitration Rules for Professional
Accounting and Related Services Disputes of the AAA ("AAA" Rules). In the event
of a conflict, the provisions of this document will control.
The arbitration will be conducted before a panel of three arbitrators,
regardless of the size of the dispute, to be selected as provided in the AAA
Rules. Any issue concerning the extent to which any dispute is subject to
arbitration, or concerning the applicability, interpretation, or enforceability
of these procedures, including any contention that all or part of these
procedures are invalid or unenforceable, shall be governed by the Federal
Arbitration Act and resolved by the arbitrators. No potential arbitrator may
serve on the panel unless he or she has agreed in writing to abide and be bound
by these procedures.
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Unless provided otherwise in the Agreement, the arbitrators may not award
non-monetary or equitable relief of any sort. They shall have no power to award
(i) damages inconsistent with the Agreement or (ii) punitive damages or any
other damages not measured by the prevailing party's actual damages, and the
parties expressly waive their right to obtain such damages in arbitration or in
any other forum. In no event, even if any other portion of these provisions is
held to be invalid or unenforceable, shall the arbitrators have power to make an
award or impose a remedy that could not be made or imposed by a federal court
deciding the matter in the same jurisdiction.
No discovery will be permitted in connection with the arbitration unless it is
expressly authorized by the arbitration panel upon a showing of substantial need
by the part seeking discovery.
All aspects of the arbitration shall be treated as confidential. Neither the
parties nor the arbitrators may disclose the existence, content or results of
the arbitration, except as necessary to comply with legal or regulatory
requirements. Before making any such disclosure, a party shall give written
notice to all other parties and shall afford such parties a reasonable
opportunity to protect their interests.
The results of the arbitration will be binding on the parties, and judgment on
the arbitrators' award may be entered in any court having jurisdiction.
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