PLACEMENT AGENT AGREEMENT
THIS AGREEMENT ("AGREEMENT"), made as of the 25th day of May 1999, by
and between TELECOM WIRELESS CORPORATION, a Utah corporation (the "COMPANY"),
and XXXX XXXXXXXX & ASSOCIATES, INC., a Florida corporation (the "AGENT").
BACKGROUND
The Company proposes to issue and sell Common Stock (the "SECURITIES")
resulting in gross proceeds to the Company of up to $2, 1 00,000 (the
"OFFERING") in a transaction not involving a public offering and without
registration under the Securities Act of 1933, as amended (the "ACT"),
pursuant to exemptions from the registration requirements of the Act under
Section 4(2) of the Act and Regulation D promulgated under the Act
("REGULATION D"). Agent has offered to assist the Company to structure the
Offering and the Securities, and introduce the Company to prospective
investors on a "best efforts basis." The Company desires to secure the
services of Agent on the ten-ns and conditions hereinafter set forth.
AGREEMENT
For and in consideration of the mutual covenants herein, and other
good and valuable consideration, the receipt and legal sufficiency of which
is hereby acknowledged, the parties hereto agree:
SECTION 1. ENGAGEMENT OF AGENT.
SECTION 1.1. APPOINTMENT. The Company hereby appoints Agent as its
exclusive agent in connection with the proposed issuance and sale by the
Company of securities resulting in gross proceeds to the Company of up to
$2,100,000. Agent, on the basis of the representations and warranties herein
contained, and upon and subject to the terms and conditions herein set forth,
accepts such appointment. This appointment shall be irrevocable for the
period commencing May 10, 1999, and ending July 30, 1999, which period maybe
extended by the consent of the Company and Agent (the "OFFERING PERIOD").
SECTION 1.2. COMPENSATION. The Company shall pay Agent a finder's
fee of ten percent (10%) of the gross proceeds derived from the offer, sale,
and issuance of the Securities or any other securities issued by the Company
issued by the Company during the Offering Period (the "GROSS PROCEEDS") PLUS
a non-accountable expense allowance of one percent (I%) of the Gross Proceeds.
SECTION 1.3. REIMBURSEMENT OF EXPENSES. The Company agrees to pay
the out-of-pocket expenses of Agent including the fees and expenses of
counsel to Agent for the preparation of the Transaction Agreements. The
Company agrees that the amount of such fees and expenses shall be deducted by
Escrow Agent from the proceeds of the issuance and sale of the Securities.
SECTION 1.4. LIMITED ROLE OF AGENT. Agent has acted only as an
advisor to the Company, Agent has advised the Company on the structure of the
Offering and Securities, and has identified potential investors. The Company
has offered the Securities to the investors and has negotiated directly with
the investors in the Offering. Agent will use its best efforts to introduce
the Company only to "accredited investors" as defined in Regulation D.
Wherever possible Agent will introduce the Company to prospective investors
who are not "U.S. Persons," as defined in Regulation S.
SECTION 1.5. RIGHT OF FIRST REFUSAL. The Company hereby grants Agent
a right of first refusal to act as placement agent for any future private
financings of the Company, whether of equity securities, convertible debt
securities, or securities or instruments convertible into or exchangeable for
debt or equity securities of the Company, mergers, acquisitions, or similar
transactions. The duration of Agent's right of first refusal under this
Section 1.5 shall be for a period of one (1) year following the final Closing
of the Offering. In the event that the Company wishes to undertake a
transaction described in this Section 1.5, the Company shall send Agent a
written notice of the proposed transaction (whether the transaction is
initiated by the Company or is offered to the Company by a third party) in
sufficient specificity to allow Agent to clearly understand the proposed
transaction. This notice must be delivered to Agent at least twenty days
prior to the proposed closing of the transaction. Agent shall have ten days
from receipt of that notice to determine whether or not it wishes to exercise
its right of first refusal with respect to that transaction. Agent shall
notify the Company in writing of its decision to exercise or waive its right
of first refusal with respect to the transaction described in the notice. If
Agent waives its right of first refusal with respect to a particular
transaction, the Company may proceed with that transaction, PROVIDED HOWEVER,
that if the terms of the transaction are changed in any material way from the
terms set forth in the notice to Agent, Agent's right of first refusal shall
commence again. Agent's waiver of its rights of first refusal with respect
to any specific transaction shall not act as a waiver of its rights with
respect to future transactions within the applicable time period.
SECTION 1.6. CONFIDENTIALITY. The Company agrees to maintain the
confidentiality of all prospective investors identified to the Company by
Agent, except as required by applicable law. For a period of two (2) years
from the Closing, the Company will not solicit or enter into any financing
transaction with such investors without the written consent of Agent AND
payment to Agent of compensation no less than the compensation to be paid to
Agent hereunder for raising a like amount.
SECTION 1.7. REMEDIES. In the event that Company breaches Section
1.5 or Section 1.6 hereof, Agent shall be entitled to receive compensation in
respect of the financing giving rise to the breach of this Agreement at the
rates set forth in Section 1.2 hereof.
SECTION 2. CONDUCT OF THE OFFERING.
SECTION 2.1. OFFERING DOCUMENTS. The Company shall utilize a Common
Stock Purchase Agreement (the "PURCHASE AGREEMENT"), the Repricing Warrant in
the form of EXHIBIT A to the Purchase Agreement (the "REPRICING WARRANT"), a
Registration Rights Agreement in the form of EXHIBIT B to the Purchase
Agreement the ("REGISTRATION RIGHTS AGREEMENT"), an Escrow Agreement in the
form of EXHIBIT C to the Purchase Agreement (the "ESCROW AGREEMENT"), a form
of opinion of Company counsel in the form of EXHIBIT D to the Purchase
Agreement (the "COMPANY OPINION"), a Form of Irrevocable Transfer Agent
Instructions in the form of EXHIBIT E to the Purchase Agreement (the
"TRANSFER AGENT INSTRUCTIONS"), a certificate of the Company's Secretary (the
"SECRETARY CERTIFICATE") and a certificate of the Company's chief executive
officer ("COMPLIANCE CERTIFICATE") (collectively, the Purchase Agreement and
all Exhibits thereto, the Secretary Certificate and the Compliance
Certificate are herein after referred to as the "TRANSACTION AGREEMENTS") in
connection with the Offering. The Company and its counsel have reviewed,
commented upon, and approved the Transaction Agreements.
SECTION 2.2. PUBLIC INFORMATION. The Company within a reasonable
amount of time prior to any Closing, shall provide each prospective investor
with a copy of all information required by Rule 502(b)(2)(ii) of Regulation D
promulgated pursuant to the Securities Act (collectively, "SEC DOCUMENTS"),
The SEC Documents have been prepared in conformity with the requirements (to
the extent applicable) of the Securities and Exchange Act of 1934, as amended
(the "ACT") and the rules and
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regulations ("RULES AND REGULATIONS") of the Commission promulgated
thereunder. As used in this Agreement, the term "OFFERING DOCUMENTS" means
collectively the SEC Documents and the Transaction Agreements, and all
amendments, exhibits, and supplements thereto, together with any other
documents which are provided to Agent by, or approved for Agent's use by, the
Company for this Offering.
SECTION 2.3. ACCURACY OF OFFERING DOCUMENTS. The Offering Documents,
at the time of delivery to Purchasers, conformed in all material respects
with the requirements, to the extent applicable, of the Act and the
applicable Rules and Regulations, and did not include 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. At each Closing,
the Offering Documents will contain all statements which are required to be
stated therein in accordance with the Act and the Rules and Regulations for
the purposes of the proposed Offering, and all statements of material fact
contained in the Offering memorandum will be true and correct, and the
Offering Documents will not include 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; PROVIDED HOWEVER, that the Company does not
make any representations or warranties as to the information contained in or
omitted from the Offering Documents in reliance upon written information
furnished on behalf of Agent specifically for use therein. Agent has no
responsibility for the contents, accuracy, or adequacy of the Offering
Documents, or for the compliance of the Offering Documents, with the
requirements of Rule 502(b)(2)(ii) of Regulation D promulgated pursuant to
the Securities Act.
SECTION 2.4. DUTY TO AMEND. If, at any time during the Offering, or
such longer period as the Offering Documents are required to be delivered
under the Act, any event occurs or any event known to the Company relating to
or affecting the Company shall occur as a result of which the Offering
Documents as then amended or supplemented would include an untrue statement
of a material fact, or omit to state any material fact 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 after the date hereof to
amend or supplement the Offering Documents to comply with the Act or the
applicable Rules and Regulations, the Company shall forthwith notify Agent
thereof and shall prepare such further amendment or supplement to the
Offering Documents as may be required and shall furnish and deliver to Agent
and to others, whose names and addresses are designated by Agent, all at the
cost of the Company, a reasonable number of copies of the amendment or
supplement or of the amended or supplemented Offering Documents which, as so
amended or supplemented, will not contain an untrue statement of a material
fact or omit to state any material fact necessary in order to make the
Offering Documents not misleading in the light of the circumstances when such
documents are delivered to a purchaser or prospective purchaser, and which
will comply in all respects with the requirements (to the extent applicable)
of the Act and the applicable Rules and Regulations.
SECTION 2.5. ESCROW OF FUNDS. Pursuant to the Escrow Agreement,
executed by the Company, the person named as escrow agent in the Escrow
Agreement (the "ESCROW AGENT"), and the prospective investors who have
executed signature pages to the Purchase Agreement, the Registration Rights
Agreement, and the Escrow Agreement (the "PURCHASERS"), the purchase price
for the Securities to be purchased as reflected on the Purchaser Signature
Page to the Purchase Agreement shall be wired to the Escrow Agent to be held
by the Escrow Agent as provided in the Escrow Agreement.
SECTION 2.6. APPROVAL OF INVESTORS. Prior to each closing, the
Company shall have the right to approve each Purchaser. If the Company
withholds approval of any Purchaser, the purchase price
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wired to Escrow Agent by such Purchaser shall be returned to such Purchaser
along with the Purchaser Signature Pages of such Purchaser to the Purchase
Agreement, the Registration Rights Agreement, and the Escrow Agreement. The
right to withhold approval of any Purchaser shall be deemed to have been
waived if the Company authorizes the Escrow Agent to disburse funds provided
by any Purchaser at any Closing.
SECTION 2.7. DELIVERY OF SECURITIES. Securities in such form that,
subject to applicable transfer restrictions as described in the Purchase
Agreement, they can be negotiated by the holders thereof (issued in such
denominations and in such names as the Purchasers of the Securities may
request) shall be delivered by the Company to the counsel for Agent, with
copies made available to Agent for checking at least one (1) full business
day prior to the Closing Date, it being understood that the directions from
Agent to the Company shall be given at least two (2) full business days prior
to the Closing Date. The Securities shall be delivered at the Initial Closing
and at each Subsequent Closing.
SECTION 2.8. INITIAL CLOSING. The Initial Closing (the "INITIAL
CLOSING") shall occur at such time as (a) Purchasers have delivered to the
Company (care of Xxxxxxx Law Group LLC, counsel for Agent) executed Purchaser
Signature Pages to each of the Purchase Agreement, the Registration Rights
Agreement, and the Escrow Agreement, (b) the Company has not withheld
approval of the Purchasers, and (c) all other conditions to the obligation of
the Purchasers and the Company to close the transactions contemplated by the
Purchase Agreement at such Initial Closing have been satisfied or waived.
SECTION 2.9. SUBSEQUENT CLOSINGS. In the event that the Initial
Closing shall be for an amount of Securities that is less than the amount of
the Offering, the Offering may be continued, and additional Closings may be
held (each a "SUBSEQUENT CLOSING") throughout the Offering Period if: (a)
Purchasers have delivered to the Company (care of Xxxxxxx Law Group LLC,
counsel for Agent) executed Purchaser Signature Pages to each of the Purchase
Agreement, the Registration Rights Agreement, and the Escrow Agreement, (b)
the Company has not withheld approval of the Purchasers, and (c) all other
conditions to the obligation of the Purchasers and the Company to close the
transactions contemplated by the Purchase Agreement at each such Subsequent
Closing have been satisfied or waived.
SECTION 2.10. DISBURSEMENTS AT CLOSING. At each Closing, the Company
shall execute a Release Notice that authorizes the Escrow Agent to pay the
expenses of the Offering in the amounts specified, and effect a wire transfer
of the net proceeds of such Closing to the Company or another entity
designated therein by the Company. The authorization of the Company to
release the funds held by the Escrow Agent is the Company's authorization to
release the executed Transaction Agreements and Securities to the Purchasers.
One complete set of executed Transaction Agreements will be delivered to the
Company.
SECTION 2.11. TIME AND PLACE OF CLOSINGS. The Initial Closing and any
Subsequent Closing shall be held at the offices of Xxxxxxx Law Group LLC,
0000 Xxxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000, at 10:00 a.m. on such
dates as are fixed in accordance with the Purchase Agreement and the
agreement of all the parties to each such closing. A Closing Date may be
changed by mutual agreement of Agent and the Company. The Company agrees to
rely on faxed signature pages from the Purchasers, without the requirement of
obtaining an originally signed version of any of the Transaction Agreements
to which a Purchaser is a Party.
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SECTION 3. CONDITIONS OF AGENT'S OBLIGATIONS.
Agent's obligations hereunder shall be subject to the accuracy, as of
the Closing Date, of the representations and warranties on the part of the
Company contained in this Agreement, to the fulfillment of or compliance by
the Company with all covenants and conditions hereof, and to the following
additional conditions:
(a) There shall be no outstanding objection to any Transaction
Agreement by the Company or its counsel or any Purchaser or its counsel.
(b) The Company shall not have disclosed that the Offering
Documents, or any amendment thereof or supplement thereto, contains an
untrue statement of fact, which, in the opinion of counsel to Agent, is
material, or omits to state a fact, which, in the opinion of such
counsel, is material and is required to be stated therein, or is
necessary to make the statements therein, under the circumstances in
which they were made, not misleading.
(c) Between the date hereof and the Closing Date, the Company
shall not have sustained any loss on account of fire, explosion, flood,
accident, calamity, or any other cause of such character as would
materially adversely affect its business or property considered as an
entire entity, whether or not such loss is covered by insurance.
(d) There shall be no litigation instituted or overtly
threatened against the Company, and there shall be no proceeding
instituted or threatened against the Company before or by any federal or
state commission, regulatory body, or administrative agency, or other
governmental body, domestic or foreign, wherein an unfavorable ruling,
decision, or finding would materially adversely affect the business,
franchises, license, permits, operations, or financial condition or
income of the Company considered as an entity.
(e) Except as contemplated herein or as set forth in the
Offering Documents, during the period subsequent to the most recent
financial statements contained in the Offering Documents, if any, and
prior to the Closing Date, the Company (i) shall have conducted its
business in the usual and ordinary manner as the same is being conducted
as of the date hereof and (ii) except in the ordinary course of business,
the Company shall not have incurred any liabilities or obligations
(direct or contingent) or disposed of any assets, or entered into any
material transaction, or suffered or experienced any substantially
adverse change in its condition, financial or otherwise. At the Closing
Date, the equity account of the Company shall be substantially the same
as reflected in the most recent balance sheet contained in the Offering
Documents without considering the proceeds from the sale of the
Securities other than as may be set forth in the Offering Documents.
(f) The authorization of the Securities by the Company and all
proceedings and other legal matters incident thereto and to this
Agreement shall be reasonably satisfactory in all respects to Agent and
its counsel.
(g) The Company shall have furnished Agent a copy of the
Company opinion with respect to the sufficiency of all corporate
proceedings and other legal matters relating to this Agreement as Agent
may reasonably require.
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(h) The Company shall have furnished to Agent the opinion,
dated the Initial Closing, addressed to Agent, from counsel to the
Company, as required by the Purchase Agreement.
(i) The Company shall have furnished to Agent a copy of the
Compliance Certificate and the Secretary Certificate each dated as of the
Closing Date.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
For the purpose of inducing Agent to enter into this and perform this
Agreement, the Company hereby represents and warrants to and agrees with
Agent as follows:
SECTION 4.1. CORPORATION CONDITION. The Company's condition is as
described in its Offering Documents, except for changes in the ordinary
course of business and normal year-end adjustments that are not in the
aggregate materially adverse to the Company. The Offering Documents, taken
as a whole, present fairly the business and financial position of the Company
as of the Closing Date.
SECTION 4.2. NO MATERIAL ADVERSE CHANGE. Except as may be reflected
in or contemplated by the Offering Documents, subsequent to the dates as of
which information is given in the Offering Documents, and prior to the
Closing Date, there shall not have been any material adverse change in the
condition, financial or otherwise, or in the results of operations of the
Company or in its business taken as a whole.
SECTION 4.3. NO DEFAULTS. Except as disclosed in the Offering
Documents or in writing to Agent, the Company is not in default in any
material respect in the performance of any material obligation, agreement, or
condition contained in any debenture, note, or other evidence of indebtedness
or any indenture or loan agreement of the Company. The execution and
delivery of this Agreement, and the consummation of the transactions herein
contemplated, and compliance with the terms of this Agreement, will not
conflict with, or result in, a breach of any of the terms, conditions, or
provisions of, or constitute a default under, the Articles of Incorporation
or bylaws of the Company (in any respect that is material to the Company),
any material note, indenture, mortgage, deed of trust, or other agreement or
instrument to which the Company is a party or by which the Company or any
property of the Company is bound, or to the Company's knowledge, any existing
law, order, rule, regulation, writ, injunction, or decree of any government,
governmental instrumentality, agency, or body, arbitration tribunal or court,
domestic or foreign, having jurisdiction over the Company or any property of
the Company. The consent, approval, authorization, or order of any court or
governmental instrumentality, agency or body is not required for the
consummation of the transactions herein contemplated except such as may be
required under the Act or under the blue sky or securities laws of any state
or jurisdiction.
SECTION 4.4. INCORPORATION AND STANDING. The Company is, and at the
Closing Date will be, duly formed and validly existing in good standing as a
corporation under the laws of the State of Utah and with full power and
authority (corporate and other) to own its properties and conduct its
business, present and proposed, as described in the Offering Documents; the
Company, has full power and authority to enter into this Agreement; and the
Company is duly qualified and in good standing as a foreign entity in each
jurisdiction in which the failure to so qualify would have a material adverse
effect on the Company or its properties.
SECTION 4.5. LEGALITY OF SECURITIES. Prior to the Closing Date, the
Securities will have been duly and validly authorized and issued, will be
valid, binding, and enforceable against the Company in
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accordance with their terms, and will conform in all material respects to the
statements with regard thereto contained in the Offering Documents.
SECTION 4.6. LEGALITY OF CONVERSION SHARES. The Common Stock into
which the Securities are convertible, when converted in accordance with the
Securities will be duly and validly issued and outstanding, fully paid, and
non-assessable and conform in all material respects to the statements with
regard thereto contained in the Offering Documents.
SECTION 4.7. LITIGATION. Except as set forth in the Offering
Documents, there is now, and at the Closing Date there will be, no action,
suit, or proceeding before any court or governmental agency, authority or
body pending or, to the knowledge of the Company, threatened, which might
result in judgments against the Company not adequately covered by insurance
or which collectively might result in any material adverse change in the
condition (financial or otherwise) or business of the Company or which would
materially adversely affect the properties or assets of the Company.
SECTION 4.8. FINDERS. The Company does not know of any outstanding
claims for services in the nature of a finder's fee or origination fees with
respect to the sale of the Securities hereunder for which Agent may be
responsible, and the Company will indemnify Agent from any liability for such
fees by any party who has a claim for such compensation from the Company and
for which person Agent is not legally responsible.
SECTION 4.9. TAX RETURNS. The Company has filed all federal and
state tax returns which are required to be filed, and has paid all taxes
shown on such returns and on all assessments received by it to the extent
such taxes have become due. All taxes with respect to which the Company is
obligated have been paid or adequate accruals have been set up to cover any
such unpaid taxes.
SECTION 4.10. AUTHORITY. The execution and delivery by the Company of
this Agreement have been duly authorized by all necessary action, and this
Agreement is the valid, binding, and legally enforceable obligation of the
Company subject to standard qualifications as to the availability of
equitable remedies, the effect of bankruptcy and other laws relating to the
protection of debtors and public policy opinions promulgated by the
Commission with respect to indemnification against liabilities under the Act.
SECTION 4.11. ACTIONS BY THE COMPANY. The Company will not take any
action which will impair the effectiveness of the transactions contemplated
by this Agreement.
SECTION 5. COVENANTS OF THE COMPANY.
The Company covenants and agrees with Agent that:
SECTION 5.1. RESTRICTIONS ON AMENDMENTS. After the date hereof, the
Company will not at any time, prepare and distribute any amendment or
supplement to the Offering Documents, of which amendment or supplement Agent
shall not previously have been advised and Agent and its counsel furnished
with a copy within a reasonable time period prior to the proposed adoption
thereof, or to which Agent shall have reasonably objected in writing on the
ground that it is not in compliance with the Act or the Rules and Regulations
(if applicable).
SECTION 5.2. EXPENSES OF OFFERING. The Company will pay, whether or
not the transactions contemplated by the Transaction Agreements are
consummated, all costs and expenses incident to the Transaction Agreements,
including all expenses incident to the authorization of the Securities, their
issue
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and delivery to the Escrow Agent, any original issue taxes in connection
therewith, all transfer taxes, if any, incident to the initial sale of the
Securities, the fees and expenses of Agent's and the Company's counsel
(except as provided below) and accountants, and the cost of reproduction of
and furnishing to Agent copies of the Offering Documents as herein provided,
PROVIDED HOWEVER, that the Company shall not be responsible for the payment
of fees and expenses incurred by Agent's counsel, if Agent is unable to
procure Purchaser Signature Pages to the Transaction Agreements from a
Purchaser that the Company was willing to accept.
SECTION 5.3. AVAILABILITY OF INFORMATION. Prior to the Closing Date,
the Company will cooperate with Agent in such investigation as it may make or
cause to be made of all of the properties, business, and operations of the
Company in connection with the Offering of the Securities. The Company will
make available to it in connection therewith such information in its
possession as Agent may reasonably request and will make available to Agent
such persons as Agent shall deem reasonably necessary and appropriate in
order to verify or substantiate any such information so supplied.
SECTION 5.4. REPORTS AND FILINGS. The Company shall be responsible
for making any and all filings required by the blue sky authorities and
filings required by the laws of the jurisdictions in which the subscribers
who are accepted for purchase of Securities are located, if any. Agent shall
assist Company in this respect, but such filings shall be the responsibility
of Company.
SECTION 5.5. NO UNDISCLOSED EVENTS, LIABILITIES, DEVELOPMENTS, OR
CIRCUMSTANCES. The Company's condition is as described in its Offering
Documents, except for changes in the ordinary course of business and normal
year-end adjustments that are not individually or in the aggregate materially
adverse to the Company. The Offering Documents, taken as a whole, will
present fairly the business and financial position of the Company as of each
Closing Date.
SECTION 5.6. NO MATERIAL ADVERSE CHANGE. Except as may be reflected
in or contemplated by the Offering Documents, subsequent to the dates as of
which information is given in the Offering Documents, and prior to each
Closing Date, there shall not have been any material adverse change in the
condition, financial, or otherwise, or in the results of operations of the
Company or in its business taken as a whole.
SECTION 6. INDEMNIFICATION.
SECTION 6.1. INDEMNIFICATION OF AGENT. The Company agrees to
indemnify and hold harmless Agent, each person who controls Agent within the
meaning of Section 15 of the Act, and Agent's employees, accountants,
attorneys and agents (the "AGENT'S INDEMNITEES") against any and all losses,
claims, damages, or liabilities, joint or several, to which they or any of
them may become subject under the Act or any other statute or at common law
for any legal or other expenses (including the costs of any investigation and
preparation) incurred by them in connection with any litigation, whether or
not resulting in any liability, but only insofar as such losses, claims,
damages, liabilities, and litigation arise out of or are based upon any
untrue statement of material fact contained in the Offering Documents or any
amendment or supplement thereto or any application or other document filed in
any state or jurisdiction in order to qualify the Securities under the Blue
Sky or securities laws thereof, or the omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein, under the circumstances under which they were made, not misleading,
all as of the date of the Offering Documents or of such amendment as the case
may be; PROVIDED HOWEVER, that the indemnity agreement contained in this
Section 6.1 shall not apply to any amounts paid in settlement of any such
litigation, if such settlements are made without the consent of the Company,
nor shall it apply to Agent's Indemnitees in respect to any such losses,
claims, damages, or liabilities arising out of or based upon any
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such untrue statement or alleged untrue statement or any such omission or
alleged omission, if such statement or omission was made in reliance upon
information furnished in writing to the Company by Agent specifically for use
in connection with the preparation of the Offering Documents or any such
amendment or supplement thereto or any application or other document filed in
any state or jurisdiction in order to qualify the Securities under the Blue
Sky or securities law thereof. This indemnity agreement is in addition to
any other liability which the Company may otherwise have to Agent's
Indemnitees. Agent's Indemnitees agree, within ten (10) days after the
receipt by them of written notice of the commencement of any action against
them in respect to which indemnity may be sought from the Company under this
Section 6. 1, to notify the Company in writing of the commencement of such
action; PROVIDED HOWEVER, that the failure of Agent's Indemnitees to notify
the Company of any such action shall not relieve the Company from any
liability which it may have to Agent's Indemnitees on account of the
indemnity agreement contained in this Section 6. 1, and further shall not
relieve the Company from any other liability which it may have to Agent's
Indemnitees, and if Agent's Indemnitees shall notify the Company of the
commencement thereof, the Company shall be entitled to participate in (and,
to the extent that the Company shall wish, to direct) the defense thereof at
its own expense, but such defense shall be conducted by counsel of recognized
standing and reasonably satisfactory to Agent's Indemnitees, defendant or
defendants, in such litigation. The Company agrees to notify Agent's
Indemnitees promptly of the commencement of any litigation or proceedings
against the Company or any of the Company's officers or directors of which
the Company may be advised in connection with the issue and sale of any of
the Securities and to furnish to Agent's Indemnitees, at their request,
copies of all pleadings therein and to permit the Company's Indemnitees to be
observers therein and apprise Agent's Indemnitees of all developments
therein, all at the Company's expense.
SECTION 6.2. INDEMNIFICATION OF COMPANY. Agent agrees, in the same
manner and to the same extent as set forth in Section 6.1 above, to indemnify
and hold harmless the Company, and the Company's and Company's employees,
accountants, attorneys, and agents (the "COMPANY'S INDEMNITEES") with respect
to (a) any statement in or omission from the Offering Documents or any
amendment or supplement thereto or any application or other document filed in
any state or jurisdiction in order to qualify the Securities under the Blue
Sky or securities laws thereof, or any information furnished pursuant to
Section 2.2 hereof, if such statement or omission was made in reliance upon
information furnished in writing to the Company by Agent on its behalf
specifically for use in connection with the preparation thereof or supplement
thereto, or (b) any untrue statement of a material fact made by Agent or its
agents not based on statements in the Offering Documents or authorized in
writing by the Company, or with respect to any misleading statement made by
Agent or its agents resulting from the omission of material facts which
misleading statement is not based upon the Offering Documents, or information
furnished in writing by the Company or, (c) any breach of any representation,
warranty, or covenant made by Agent in this Agreement. Agent's liability
hereunder shall be limited to the amount received by it for acting as Agent
in connection with the Offerings. Agent shall not be liable for amounts paid
in settlement of any such litigation if such settlement was effected without
its consent. In case of the commencement of any action in respect of which
indemnity may be sought from Agent, the Company's Indemnitees shall have the
same obligation to give notice as set forth in Section 6.1 above, subject to
the same loss of indemnity in the event such notice is not given, and Agent
shall have the same right to participate in (and, to the extent that it shall
wish, to direct) the defense of such action at its own expense, but such
defense shall be conducted by counsel of recognized standing reasonably
satisfactory to the Company. Agent agrees to notify the Company's
Indemnitees and, at their request, to provide copies of all pleadings therein
and to permit the Company's Indemnitees to be observers therein and apprise
them of all the developments therein, all at Agent's expense.
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SECTION 7. TERMINATION.
SECTION 7.1. TERMINATION BY AGENT. This Agreement may be terminated
at any time during the Offering Period by Agent by written notice to the
Company, if the Company shall have failed or been unable to comply with any
of the terms, conditions, or provisions of the Transaction Agreements to be
performed, complied with, or fulfilled by the Company within the respective
times, if any, herein provided for, unless compliance therewith or
performance or satisfaction thereof shall have been expressly waived by Agent
in writing.
SECTION 7.2. TERMINATION BY COMPANY. This Agreement may be
terminated by the Company at the conclusion of the Offering Period by notice
to Agent if Agent shall have failed or been unable to comply with any of the
terms, conditions, or provisions of this Agreement to be performed, complied
with, or fulfilled by Agent within the respective times, if any, herein
provided for, unless compliance therewith or performance or satisfaction
thereof shall have been expressly waived by the Company in writing.
SECTION 7.3. TERMINATION FOR FORCE MAJEURE EVENTS. This Agreement
may be terminated by Agent by notice to the Company at any time, if, in the
reasonable, good faith judgment of Agent, payment for and delivery of the
Securities is rendered impracticable or inadvisable because: (a) additional
material governmental restrictions not in force and effect on the date hereof
shall have been imposed upon trading in securities generally; (b) a war or
other national calamity shall have occurred; or (c) the condition of the
market (either generally or with reference to the sale of the Securities to
be offered hereby) or the condition of any matter affecting the Company or
any other circumstance is such that it would be undesirable, impracticable or
inadvisable, in the judgment of Agent, to proceed with this Agreement or with
the Offering.
SECTION 7.4. TERMINATION WITHOUT LIABILITY. Any termination of this
Agreement pursuant to this Section shall be without liability of any
character (including, but not limited to, loss of anticipated profits or
consequential damages) on the part of any party thereto, except that the
Company shall remain obligated to pay the costs and expenses provided to be
paid by it specified in Sections 1.3 and 5.2, and the Company and Agent shall
be obligated to pay, respectively, all losses, claims, damages, or
liabilities, joint or several, under Section 6.1 in the case of the Company
and Section 6.2 in the case of Agent.
SECTION 8. MISCELLANEOUS.
SECTION 8.1. NOTICES. Whenever notice is required by the provisions
of this Agreement to be given, such notice shall be in writing, addressed:
If to Company:
Telecom Wireless Corporation
0000 XXX Xxxxxxxxx, 00xx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxx, President
Tel: (000) 000-0000
Fax: (000) 000-0000
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With a copy to:
Xxxx X. Xxxxxx, Esq.
0000 Xxxxx Xxxxxxxxx Xxx
Xxxxxxxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
If to Agent:
Xxxx Xxxxxxxx & Associates, Inc.
0000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
With a copy to:
Xxxxxxx Law Group LLC
0000 Xxxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx XX, Esq.
el: (000) 000-0000
Fax: (000) 000-0000
8.2. BENEFIT. This Agreement is made solely for the benefit of
Agent and the Company, their respective officers and directors and any
controlling person referred to in Section 15 of the Act and their respective
successors and assigns, and no other person may acquire or have any right
under or by virtue of this Agreement, including, without limitation, the
holders of any Securities. The term "SUCCESSOR" or the term "SUCCESSORS AND
ASSIGNS" as used in this Agreement shall not include any purchasers, as such,
of any of the Securities.
8.3. SURVIVAL. The respective indemnities, agreements,
representations, warranties, covenants and other statements of the Company
and Agent, or the officers, directors or controlling persons of the Company
and Agent as set forth in or made pursuant to this Agreement and the
indemnity agreements of the Company and Agent contained in Section 6 hereof
shall survive and remain in full force and effect, regardless of (a) any
investigation made by or on behalf of the Company or Agent or any such
officer, director or controlling person of the Company or of Agent; (b)
delivery of or payment for the Securities; or (c) the Closing Date, and any
successor of the Company or Agent or any controlling person, officer or
director thereof, as the case may be, shall be entitled to the benefits
hereof.
8.4. GOVERNING LAW. The validity, interpretation, and construction
of this Agreement will be governed by the laws of the State of Florida
without regard to its principles of conflict of laws. Any dispute or
controversy between the parties arising in connection with this Agreement or
the subject matter contemplated by this Agreement shall be resolved by
arbitration before a three-member panel of the American Arbitration
Association in accordance with the commercial arbitration rules of said forum
and the Federal Arbitration Act, 9 U.S.C. 1 ET SEQ., with the resulting award
being final and conclusive. Said arbitrators shall be empowered to award all
forms of relief and damaged claimed, including, but not
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limited to, attorney's fees, expenses of litigation and arbitration,
exemplary damages, and prejudgment interest. The parties further agree that
any arbitration action between them shall be heard in Atlanta, Georgia, and
expressly consent to the jurisdiction and venue of the Superior Court of
Xxxxxx County, Georgia, and the United States District Court for the Northern
District of Georgia, Atlanta Division for the adjudication of any civil
action asserted pursuant to this Paragraph.
8.5. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which may be deemed an original and all of which
together will constitute one and the same instrument.
8.6. CONFIDENTIAL INFORMATION. All confidential financial or
business information (except publicly available or freely usable material
otherwise obtained from another source) respecting either party will be used
solely by the other party in connection with the within transactions, be
revealed only to employees or contractors of such other party who are
necessary to the conduct of such transactions, and be otherwise held in
strict confidence.
8.7. PUBLIC ANNOUNCEMENTS. Prior to the Closing Date, neither party
hereto will issue any public announcement concerning the within transactions
without the approval of the other party.
8.8. FINDERS. The parties acknowledge that no person has acted as a
finder in connection with the transactions contemplated herein and each will
agree to indemnify the other with respect to any other claim for a finder's
fee in connection with the Offering.
8.9. RECITALS. The recitals to this Agreement are a material part
hereof, and each recital is incorporated into this Agreement by reference and
made apart of this Agreement.
IN WITNESS WHEREOF, the parties hereto have duly caused this Agreement
to be executed as of the day and year first above written.
[Signatures on the following page]
-11-
COMPANY SIGNATURE PAGE
TO
PLACEMENT AGENT AGREEMENT
COMPANY:
TELECOM WIRELESS CORPORATION
By:
------------------------------------
Xxxxx X. Xxxxxxx, President
-12-
AGENT SIGNATURE PAGE
TO
PLACEMENT AGENT AGREEMENT
AGENT:
XXXX XXXXXXXX & ASSOCIATES, INC.
By:
------------------------------------
Xxxx Xxxx
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