EXHIBIT 10.13
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FINDERS AGREEMENT
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This Agreement (the "Agreement") is entered into as of this 1st day of
June, 1999, between CDKnet, LLC ("CDK") and its parent, XXXxxx.Xxx, Inc. ("CDK,
Inc.") (together, hereinafter sometimes referred to as the "Company") and Xxxx
Xxx Xxxx and Xxxxxxxxx X. Xxxxxxxxx (together sometimes referred to as
"Finder").
RECITALS
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WHEREAS, Finder represents that it will endeavor to introduce the
Company to one or more Targets (as defined in paragraph 1 below) who may be
interested in (a) the potential financing of Company (a "Financing
Transaction"), (b) the purchase or merger with the Company ( a "Purchase
Transaction") or (c) establishment of a joint venture with the Company (a
"Venture Transaction"), collectively sometimes hereinafter referred to as (a
"Transaction"), and
WHEREAS, the Company desires to engage the services of Finder to
provide introductions to such Targets in accordance with the terms and
conditions set forth in this Agreement.
AGREEMENT
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NOW, THEREFORE, in consideration of the premises and mutual covenants
hereinafter contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. The Company engages Finder for the Term of this Agreement to find
Targets interested in effecting a Transaction with the Company and Finder will
use its best efforts to introduce the company to such Targets. For purposes of
this Agreement, "Targets" shall mean individuals or entities introduced to the
Company by Finder.
2. In order to coordinate the Company's and Finders' respective efforts
during the period of engagement hereunder, Finder will from time to time notify
the Company in writing of potential Targets. If Target has not been previously
introduced to Company, Finder will use its best efforts to introduce the Target
to the Company for the purpose of effecting a Transaction, Schedule A is an
initial Finder Target list, Schedule B are those entities the Company is
currently in negotiation with. If Finder has not commenced meaningful (defined
as meetings between Company and Target ) negotiations by October 31, 1999 with
individual Targets listed in Schedule A, Finder shall no longer be exclusive as
to such Targets and Company directly or through third parties is entitled to
approach such Targets for the purposes of effecting a transaction in which event
Finder will not receive the fees set forth below. Company and Finder may
supplement Schedules A and B respectively from time to time by notice to the
other party.
3. Upon the execution of this Agreement and separate and apart from the
Success Fees described in paragraph 4, and for services rendered, the Company
shall issue to Xxxxxxxxx X. Xxxxxxxxx a five year warrant to acquire 100,000
shares of CDK, Inc. common stock at an exercise price of $1,00 per share.
4. In the event of the completion of a Transaction with a Target during
the term of this Agreement, (completion of a transaction being defined as
collection by the Company of consideration, i.e. cash or anything of value), the
Company shall pay Finder Success Fees (as defined below) in accordance with the
following:
A. In the case of a Financing Transaction:
i. Upon completion of a Financing Transaction arising
out of Finder's introduction of minimally $2 million dollars arising
out of Finder's introduction, the Company shall issue to Finder five
year warrants to purchase the greater of (a) 5000,000 shares of the
CDK, Inc.'s common stock at $1.00 per share, or (b) 2-1/2% of CDK
Inc.'s common stock outstanding after giving effect to the Financing
Transaction, on a fully diluted basis, at an exercise price of $1.00
per share. If the financing is less than $2 million dollars, the Finder
Success Fee shall be reduced proportionally.
B. In the case of a Purchase Transaction:
i. Upon completion of a Purchase Transaction arising
out of Finder's introduction, the Company shall pay to finder 5% of the
total consideration (including without limitation assumption of debt
and payment of "golden parachutes") paid to the Company or its
shareholders if a sale of its stock or assets or 5% of the total
consideration paid by the company to a third party if a purchase of
third party stock or assets such payment to be in cash or stock
depending on the form of the purchase price.
ii. For purposes hereof, a Purchase Transaction shall
include (a) the sale of all or a portion of the Company, or shares
whether by means of a sale of stock, or assets, merger, consolidation,
exchange offer, or other such transaction of a like nature, regardless
of form or (b) the acquisition by the Company of a third party in
exchange for Company stock or other assets.
C. In the case of a Venture Transaction:
i. Upon completion of a Venture Transaction arising
out of Finder's introduction, the Company shall pay finder a Success
Fee equal to 5% of that portion of the venture contributed to or
delivered to the venture by the Target without any value for the
Company contribution.
ii. For the purposes hereof, a Venture Transaction
shall include the
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establishment of any business organ involving the assets, capital
and/or personnel of the Company and the assets, personnel and/or
capital of a Target.
5. Where the Success Fee payable to Finder in Paragraph 4(A)
is payable in warrants, at the completion of the Transaction the company shall
issue a warrant agreement with the appropriate number of warrants together with
an executed Registration Rights Agreement in the forms annexed hereto.
6. Except as otherwise provided herein, all Success Fees
payable to Finder shall be allocated 50% to Xxxx Xxx Xxxx and 50% to Xxxxxxxxx
X. Xxxxxxxxx.
7. Regardless of whether or not the transactions contemplated
by this Agreement are consummated, the Company subject to its prior written
consent agrees to reimburse Finder upon request made from time to time, for its
reasonable out-of-pocket expenses incurred in connection with its activities
hereunder.
8. It is understood and agreed that the company has the right,
without any liability to Finder, to terminate discussions for the financing,
purchasing, or venture involving the Company for any reason whatsoever at any
time.
9. The Company shall indemnify Finder, its shareholders,
affiliates, officers, directors, employees, agents and controlling persons and
hold them harmless from and against any losses, claims, damages or liabilities,
including, as incurred, reasonable legal fees and other expenses, to which they
may become subject as a result of or in connection with the rendering of
services hereunder as authorized hereby to the extent that such losses, claims,
damages or liabilities are not caused by Finders or any indemnities' gross
negligence or bad faith.
10. This Agreement shall remain in full force and effect for a
period of twelve (12) months after the date hereof (subject to early termination
by the Company upon 30 days' notice after six months from the date hereof);
provided, however, that Finder shall be entitled to receive the consideration
set forth in paragraph 4 hereof in the event a Target consummates a Transaction
with the Company within one year from the expiration of this Agreement. The
provisions of paragraphs 6, 7, 9 and 11 shall also survive the termination of
this Agreement.
11. The Company acknowledges that Finder has not done any due
diligence with respect to any Target and that Finder makes no representations
whatsoever with respect to any Target (including without limitation its
financial condition or its ability to perform any obligations to which it is or
may become bound), and the company expressly agrees that Finder shall have no
liability whatsoever in connection with any Target it may introduce to the
Company. The Company and Finder agree that Finder is an independent contractor
and is not an employee or agent of the Company and it has no authority to bind
the Company in any manner whatsoever.
12. Upon the completion of a Transaction, Finder can publish a
suitable and customary announcement concerning the Transaction.
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13. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without giving effect to its
conflict of law principles.
14. This Agreement constitutes the entire agreement between
the parties and supersedes any prior agreements, whether written or oral,
between the parties. No modification, extension or change in this Agreement
shall be effective unless it is in writing and signed by both Finder and the
Company.
15. The provisions of this Agreement shall be binding upon and
shall inure to the benefit of the parties hereto, their heirs, legal
representatives, successors and assigns. This Agreement may not be assigned
except upon the prior written consent of the other party to this Agreement.
16. Any notice hereunder shall be in writing and delivery
thereof shall be complete if delivered in person, by facsimile or mailed by
overnight mail, or registered or certified mail, postage prepaid to the
following addresses (unless changed by written notice):
Finder: Xxxxxxxxx X. Xxxxxxxxx and Xxxx Xxx Xxxx
000 Xxxx Xxxxxx, 00 Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Company: CDKnet, LLC
000 Xxxx 00xx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxxxx
and
XXXxxx.Xxx, Inc.
000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxxxx
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IN WITNESS WHEREOF, this Agreement has been executed by the parties
hereto on the date first above written.
THE COMPANY
CDKnet, LLC
By: /s/ Xxxxxx X. Xxxxxxxx
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Name: Xxxxxx X. Xxxxxxxx
Title: Chief Executive Officer
and
XXXxxx.Xxx, Inc.
By: /s/ Xxxxxx X. Xxxxxxxx
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Name: Xxxxxx X. Xxxxxxxx
Title: President
THE FINDER
/s/ Xxxx Xxx Xxxx
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Xxxx Xxx Xxxx
/s/ Xxxxxxxxx X. Xxxxxxxxx
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Xxxxxxxxx X. Xxxxxxxxx
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SCHEDULE A
Proposed Targets
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Sandler, Millenium, Ing. Xxxxxx & Xxxx, Xxxxxxxx Xxxxxx, Xxxxx Xxxxx,
Xxxxx Capital Partners, GE Capital, Flatiron Partners, SoftBank, Xxxxx Xxxxxxx,
Xxxxxxx Xxxxxxx, Hummer Winblad, Charterhouse, Dyson Xxxxxxx, Xxxx Klass, Xxxxx
Xxxxxxxx, X.X. Xxxxxx, Sprout, Citigrowth Funds, Xxxxx, Bluestone Capital
Partners, Xxxxxx Xxxxxx, Prospect Streets Ventures, GKN, Sony On-Line Ventures,
Big Entertainment, Warburg Pincus, Xxxxxxxx Xxxxx Xxxxx, Access Capital, xxxxxx
Fund, dominion Ventures, X.X. Xxxxxx Capital, Liberty Partners, Medallion
Funding, New York Community Investment, Xxx Xxxxx, Commonwalth Associates, X.
Xxxxxx, Xxxxx Xxxxxx, Quorum Growth, Sirron Capital, Ticonderoga, Triumph
Capital, Whale, First Albany, Ziff Brothers 2D Partners, Gruntal, Xxx Xxxxxx,
Xxxxx Securities, Credit Research & Trading, Milestone Capital, Laundry Room,
Xxxxxx Xxxxxxxx, Xxxx. Xxxxxxxxxxx, Xxxxxx Xxxxx, Xxxxx Xxxxxxxxx, Atomic Pops,
Ladenburg Xxxxxxx, Wit Capital, Xxxx Xxxx, Patricoff, Xxxxxxx Xxxxxx.
This list may be supplemented from time to time by a notice from Finder
to company.
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