Exhibit 10.42
PLACEMENT AGREEMENT
This Placement Agreement ("Agreement") is made as of this 21st day of
December 2001, between Xxxxxxx Xxxxxx & Company Financial Services, Inc.,
("Placement Agent") and Polar Molecular Corporation, (the "Company").
RECITALS
WHEREAS, desires to enter into an Agreement And Plan of Merger (the "Merger
Agreement") among itself, Xxxxxxx Communications Corporation ("Xxxxxxx") and a
wholly owned subsidiary of Xxxxxxx; and
WHEREAS, as a condition precedent to the Merger, the Company must raise
capital; and
WHEREAS, the Company desires to offer to sell up to Seven Hundred Thousand
Dollars ($700,000) (the "Interim Offering") of 10% Secured Convertible Notes
(the "Interim Promissory Notes"), which shall be accomplished in two parts, the
Initial Interim Offering during which the parties will attempt to raise Three
Hundred Thousand Dollars ($300,000) (the "Initial Interim Offering") and the
Subsequent Interim Offering during which the parties will attempt to raise Four
Hundred Thousand Dollars ($400,000) (the "Subsequent Initial Offering") both of
which will be raised from a limited number of accredited investors which
includes Company insiders; and
WHEREAS, the Company wishes to offer to sell (the "Offering") up to One
Million Five Hundred Thousand Dollars ($1,5000,000) of 10% Secured Convertible
Notes (hereinafter referred to as the "Promissory Notes"). From time to time the
Interim Promissory Notes and the Promissory Notes may be collectively referred
to as the "Securities". In the event of the sale of the entire One Million Five
Hundred Thousand Dollars of the Promissory Notes there may be an additional over
allotment of up to Five Hundred Thousand Dollars ($500,000), all of which, if
sold, will be considered part of the Promissory Notes. The Securities shall be
sold only to "accredited investors" as defined in Rule 501(a) of Regulation D
promulgated by the Securities Act of 1933; and
WHEREAS, the Interim Offering and the Offering is to be effected by a
private placement that is exempt from registration under the Securities Act of
1933, as amended (the "1933 Act"), and the regulations promulgated thereunder;
and
WHEREAS, the parties contemplate that the Company will prepare a Private
Placement Memorandum regarding the Offering and
the Promissory Notes (the "Memorandum") which shall include, among other things,
a current business plan; and
WHEREAS, the Securities to be sold through the Interim Offering and the
Offering are to be sold only to a limited number of accredited investors
(collectively, the "Purchasers" and individually a "Purchaser") on the basis of
the terms set forth in the Memorandum; and
NOW, THEREFORE, in consideration of the foregoing, the premises and
representations contained herein, and the payment of valuable consideration,
receipt of which is hereby acknowledged by each party hereto, it is agreed as
follows:
TERMS
1. Engagement of Placement Agent and Exclusivity.
The Company engages Placement Agent to act as exclusive Placement Agent for the
Interim Offering and the Offering through the "Offering Period", however
Placement Agent has the right to use the services of other broker-dealers as set
out in paragraph 9 herein. On the basis of the representations, warranties and
covenants herein contained, but subject to the conditions herein set forth,
Placement Agent is hereby appointed as exclusive Placement Agent for the Interim
Offering and the Offering through the Interim Offering Period and the Offering
Period for the purpose of finding Purchasers for the Securities.
2. The Interim Offering Period and the Offering Period.
a. This Agreement shall be executed at substantially the same time as the
Merger Agreement and the Interim Offering Period shall commence upon
execution of this Agreement. The Interim Offering Period shall
terminate at the close of business twenty (20) days after the
execution of the Agreement (the "Interim Offering Termination Date")
and may be extended by the mutual agreement of the Company and the
Placement Agent for an additional twenty (20) days (or shorter)
period, in which case the term Interim Offering Termination date shall
include the later date.
b. The Offering Period shall commence as of the date setout in the
Memorandum (the "Commencement Date"). The Offering Period shall
terminate at the close of business ninety (90) days after the
Commencement Date (the "Termination Date"). The Termination Date may
be extended by the parties for one (1) additional ninety (90) day (or
shorter) period thereafter, upon the agreement of the Company and the
Placement Agent, in which case the term "Termination Date" shall mean
such later date.
3. Acceptance of Appointment.
Subject to the observance of and performance by all the parties hereto of all
their obligations to be observed and performed hereunder, and to the execution
and delivery by Placement Agent of a copy of this Agreement as hereinafter
provided, Placement Agent accepts such agency and agrees to use its best efforts
during the Interim Offering Period and the Offering Period to find Purchasers
for the Securities on the terms and conditions herein set forth.
4. The Securities.
The Securities to be offered pursuant to the Interim Offering and the Offering
shall be structured generally as follows:
a. The Interim Offering shall consist of up to Seven Hundred Thousand
Dollars ($700,000) of Interim Promissory Notes with each Interim
Promissory Note in a minimum amount of Ten Thousand Dollars ($10,000).
b. The Offering shall consist of up to One Million Five Hundred Thousand
Dollars ($1,500,000) in Promissory Notes, with each Promissory Note in
a minimum amount of Ten Thousand Dollars ($10,000).
c. At the Purchaser's option, the Interim Promissory Notes shall be
convertible into common stock of the Company at the time of a merger
of the Company with a publicly traded company or before. The
Promissory Notes shall be mandatorily convertible into common stock of
the Company at the time of a merger of the Company with a publicly
traded company, or before, at the discretion of the Holder of the
Promissory Notes, all of which shall be more fully described in the
Memorandum. At the Company's discretion, the Company may decide to
accept subscriptions for Securities in amounts less than the minimum
amount stated above. Along with each Interim Promissory Note and each
Promissory Note the Company shall reserve such common stock sufficient
to meet the demand in the event all the Securities are converted into
common stock. The conversion rate(s) for the Securities shall be fixed
and determined, based on a capitalization table as determined by and
mutually agreed upon by the Company and the Placement Agent.
5. Sale of Securities and Closings.
a. Immediately after the receipt by Placement Agent from a subscriber of
an executed Subscription Agreement accompanied by payment of the
purchase price for the Securities subscribed for (the "Purchase
Price"),
Placement Agent will notify the Company and will deliver to the
Company the Subscription Agreement and the Purchaser representative's
certificate (if applicable) and evidence of such payment.
b. The Company shall, within five (5) calendar days following receipt of
an executed Subscription Agreement and evidence of payment, elect to
accept or reject the subscription and with respect to any Subscription
Agreement rejected by the Company, the Company shall return the
Subscription Agreement along with the purchase price tendered by the
subscriber if then held by the Company to the Placement Agent, for
return to the subscriber.
c. If subscriptions for more than the total amount of the Interim
Offering or the Offering are received, the order in which
subscriptions are accepted by the Company shall govern selection among
qualified Purchasers.
d. The date on which the first actual closing for the sale and purchase
of the Securities occurs, and each subsequent actual closing made
thereafter in accordance with the terms hereof, shall be called a
"Closing." The first Closing ("Initial Closing") and additional
Closings shall be held at the offices of the Company or at such other
place and at such time as the parties shall mutually agree or such
Closing may be accomplished by preparation of all closing paperwork by
the Placement Agent, which will be forwarded to the Company by
overnight delivery via recognized commercial carrier.
e. Checks or wire transfers from the Purchasers for subscriptions to the
(i) Interim Offering shall be made out to F&M Bank Interim Offering
Account FBO Polar Molecular Corporation (the "Interim Offering
Account") and (ii) for the Offering shall be made out to F&M Bank
Escrow Account FBO Polar Molecular Corporation (the "Escrow Account")
and shall be forwarded to the Placement Agent at the address stated
herein. Upon receipt of any funds for subscriptions by subscribers for
the purchase of the Securities, Placement Agent will deposit said
funds into either the Interim Offering Account or the Escrow Account,
whichever is applicable, until the time of each Closing at which time
the funds will be forwarded to the Company. Placement Agent may have
to delay Closings from time to time until said funds held in either
the Interim Offering Account or the Escrow Account are deemed to be
available funds in accordance with the procedures set out by F&M Bank.
f. The Purchase Price paid by any person whose subscription is rejected
shall be returned by the Placement Agent to such person in accordance
with the Memorandum.
6. Compensation.
a. Upon execution of this Agreement a non-refundable due diligence fee in
the amount of Twenty Five Thousand Dollars ($25,000) will be due to
the Placement Agent from the Company (the "Due Diligence Fee"),
payable as set forth in Section 6.b(1) below.
b. As compensation for the Placement Agent's services in the Interim
Offering, payment shall be as follows:
(1) Out of the proceeds of the Initial Interim Offering, the Company
shall pay to the Placement Agent the Due Diligence Fee set out
above.
(2) Out of the proceeds` of the Subsequent Interim Offering, the
Company shall pay to the Placement Agent a fee equal to $40,000
in the event that the entire amount of the Subsequent Interim
Offering is raised by the parties or in the event that less than
the entire amount of the Subsequent Interim Offering is raised
then the Company shall pay to the Placement Agent a fee equal to
ten percent (10%) of the amount raised in the Subsequent Interim
Offering.
c. As compensation for Placement Agent's services in finding subscribers
for the Promissory Notes in the Offering, the Company hereby agrees to
pay to Placement Agent, out of proceeds of the Offering, at each
Closing, a commission ("Commission") in an amount equal to ten percent
(10%) of the gross cash proceeds from the sale of the Promissory Notes
to be disbursed to the Company at such Closing. In addition the
Company shall pay to the Placement Agent, at each Closing during the
Offering, a non accountable expense allowance equal to 3% of the gross
cash proceeds to be distributed to the Company from the sale of the
Promissory Notes and a due diligence fee equal to 2% of the gross cash
proceeds to be distributed to the Company from the sale of the
Promissory Notes, said 2% due diligence fee will be
paid to Xxxxxxxx Xxxxx for completion of its due diligence and other
activities it performs on behalf of the Company. .
d. As further compensation for Placement Agent's services in finding
subscribers for the Securities sold during the Offering, at the final
Closing, the Company hereby agrees to deliver to Placement Agent a
Warrant (the "Placement Agent Warrant") for the purchase of the number
of shares of common stock of the Company equal to 10% of the total
dollar amount of the Promissory Notes issued as a result of the
Offering. The Placement Agent Warrant shall have an exercise price
equal to 120% of the price of the underlying stock of the Offering at
the time of the Closing. The Placement Agent Warrant shall expire
three (3) years from the date of issuance and shall contain the normal
terms and conditions of warrants of this size and type, which shall
include but not necessarily be limited to the right to a cashless
exercise, piggyback registration rights and standard anti dilution
provisions.
7. Payment of Expenses and Fees.
a. Whether or not the Offering contemplated by this Agreement is
consummated or this Agreement is terminated, the Company will pay all
costs and expenses incident to the performance of its obligations
under this Agreement, including, without limitation, costs and
expenses incident to the following:
i. The preparation and printing or photocopying of copies of the
Memorandum and all instruments and documents prepared in
connection with the Offering and the Memorandum; and
ii. The establishment of the exemption of the Securities from
qualification or registration under the securities or "blue sky"
laws of the states and other jurisdictions reasonably designated
by Placement Agent as those in which Placement Agent or any
broker/dealer employed by it intends to sell, or offer for sale,
the Securities; and
iii. Services of counsel for the Company, including disbursements
incurred in connection therewith; and
iv. Placement Agent shall have no liability to the Company with
respect to any of the foregoing.
b. If the Company does not close the Offering, the Company shall
reimburse Placement Agent for all reasonable out-of-pocket expenses
(which shall not include compensation or benefits for the personnel of
Placement Agent) incurred by Placement Agent in connection with this
Agreement, including but not limited to Placement Agent's attorney's
fees, travel expenses, documents preparation and other professional
advisors if required, which Placement Agent does not expect to exceed
$15,000. Placement Agent shall provide an invoice for all such
expenses to be reimbursed and payment of any expenses shall be made
only after receipt by the Company of such invoices.
c. Except as otherwise specifically provided in this Agreement, Placement
Agent and the Company shall each pay its respective expenses incident
to this Agreement and the transactions contemplated hereby, and no
party to this Agreement shall have any liability for such expenses
incurred by any other party.
8. Investor Suitability Standards and Accredited Investor Status.
Every Purchaser participating in the Interim Offering or the Offering must:
a. Be an accredited investor as defined by Rule 501(a) of Regulation D
promulgated pursuant to the Securities Act of 1933.
b. Have no need for liquidity and have adequate means of providing for
current needs and contingencies.
c. Be able to accept limitations on transferability because there is not
now any public market for the Securities, and the transferability of
the Securities is affected by restrictions on resales imposed by
federal securities laws and the laws of some states.
d. Have, alone or with a purchaser representative(s), such knowledge and
experience in financial matters, that are capable of evaluating,
either alone or with their purchaser representative(s), the merits and
risks of an investment in the Securities.
9. Soliciting Dealers.
In connection with the performance of its obligation under this Agreement,
Placement Agent may, in its sole discretion, use the services of broker-dealers
("Soliciting Dealers") who are members in good standing of the National
Association of Securities
Dealers, Inc. (NASD) and, as compensation for their services, may pay to
Soliciting Dealers an amount up to the amount of any commission received by
Placement Agent pursuant to the terms hereof. Such amount will be paid to
Soliciting Dealers by Placement Agent only out of the compensation received by
Placement Agent in respect of such sales of Securities as described in Section
6. Placement Agent shall reimburse any Soliciting Dealer for the Soliciting
Dealer's due diligence expenses incurred in connection with the Offering and the
Company shall have no obligation to reimburse Placement Agent for such due
diligence expense payments to Soliciting Dealers. The arrangements between
Placement Agent and any Soliciting Dealer shall be set forth in a Soliciting
Dealer Agreement obligating the Soliciting Dealer to fulfill all requirements
imposed on Placement Agent by this Agreement.
10. Representations, Warranties and Covenants of the Company.
The Company represents, warrants and covenants to and agrees with Placement
Agent, as of the date hereof, and as of each Closing, as follows:
a. The Company's Certificate of Incorporation authorizes the issuance of
the Interim Promissory Notes, the Promissory Notes and Warrants and
the shares of common stock issuable upon exercise of the Warrants and
that the Company has reserved and will continue to reserve shares of
common stock so that at the time of the exercise of the Warrants there
will be an adequate number of Shares of common stock available to be
issued.
b. All action required to be taken by the Company as a condition to the
offer and sale of the Securities to qualified Purchasers has been
taken or will have been taken prior to the Closing.
c. Upon (i) payment of the Purchase Price specified in each Subscription
Agreement and acceptance of each Subscription Agreement by the Company
and (ii) the execution and delivery by each Purchaser of such
additional documents, if any, as may reasonably be requested by the
Company or as set forth in the Memorandum, each accepted Purchaser
will be the owner of the Securities subscribed for and entitled to all
the benefits thereof.
d. The Company is duly and validly organized and is a validly existing
Delaware Corporation.
e. During the Offering Period and at all times at or prior to each
Closing, the Memorandum, to the extent such
information is available, will not contain an untrue statement of a
material fact or omit to state a material fact necessary in order to
make the statements therein, in light of circumstances under which
they were made, not misleading.
f. The Company and its officers, agents (excluding Placement Agent),
affiliates and employees have not taken or failed to take any actions,
whether or not in connection with the issuance of the Securities,
which action or failure to act conflict with, or otherwise make
unavailable, the exemption for the offering and sale of the Securities
from the registration provisions of the 1933 Act and by Regulation D;
and will not, either directly or indirectly, sell, offer for sale,
solicit offers to subscribe for or buy, or otherwise approach or
negotiate in respect of the securities or any other interest in the
Company during the Offering Period, except as provided for in this
Agreement or in the Memorandum.
g. This Agreement has been duly and validly authorized, executed and
delivered by or on behalf of the Company and, except insofar as the
enforceability of the indemnification provisions herein may be subject
to challenge and except as enforceability may be limited by the
application of bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the rights of creditors generally and by
judicial limitations on the right of specific performance, constitutes
the valid and legally binding agreements of the Company.
h. The execution and delivery of this Agreement, the observance and
performance hereof, and the consummation of the transactions
contemplated herein, does not and will not constitute a material
breach of, or a material default under, any instrument or agreement by
which the Company is bound, and does not and will not contravene any
existing material law, decree or order applicable to the Company.
i. The Company has not made and will not make an offer or sale of the
Securities on the basis of any communications or documents relating to
the Company or the Securities, except the Memorandum and the exhibits
thereto, other documents supplied or prepared by the Company and
reviewed by Placement Agent and delivered to prospective Purchasers
for use in making an offer or sale of the Securities, and any cover or
transmittal letter in respect of the forgoing.
j. The Company will sell the Securities only to Accredited Investors, as
that term is defined in Regulation D.
k. In making any offer or sale of the Securities, the Company and its
officers and directors shall comply with the provisions of the 1933
Act, the Securities Exchange Act of 1934, as amended (the "1934 Act"),
and the applicable securities or "Blue sky" laws of the jurisdictions
in which the Company makes offers or sales of the Securities.
l. The Company will exercise reasonable care to assure that the
Purchasers to whom it sells the Securities are not underwriters within
the meaning of Sections 2(11) of the 1933 Act. In that connection the
Company will: (i) make reasonable inquiry to determine that the
Purchaser is acquiring the Securities for his, her or its own account
for investment purposes; and (ii) obtain from the Purchaser a signed
written agreement (as provided in the Memorandum) that the Securities
and the common stock of the Company issuable upon expiration of
Warrants will not be sold without registration under the 1933 Act, in
the absence of an opinion of counsel satisfactory to counsel for the
Company that an exception from registration is available. Such
agreement shall acknowledge the understanding that the Company has no
intention to register the Securities under the 1933 Act; and (iii) if
the Company knows or has reason to believe that a Purchaser to whom it
sells any Securities relied upon the advice of a Purchaser
Representative as defined in Rule 501(h) of Regulation D in connection
with evaluating the merits and risks of a purchase of the Securities,
the Company will obtain; (iii.a) the Purchaser's written
acknowledgment that he used such representative in evaluating the
merits and risks of the prospective investment; and (iii.b) a
Purchaser Representative Certificate (in a form approved by Placement
Agent completed and signed by such representative).
m. The Company and its officers, directors and authorized agents will
offer to sell, or solicit offers to subscribe for or buy, the
Securities only in those states and other jurisdiction where permitted
so to do under applicable law and regulations. The Company and its
officers, directors, agents and employees; (i) have not at any time,
either directly or indirectly, sold, offered for sale, solicited
offers to subscribe for or buy, or otherwise approached or negotiated
in respect of the sale of, the Securities, except in connection with
this Offering; and (ii) except as disclosed in the
Memorandum, and to their knowledge, have not taken or failed to take
any action, whether in connection with the Offering or otherwise,
which action or failure to act conflicts or would conflict with, the
exemption of the sale of the Securities from the registration
provisions of the 1933 Act afforded by the Act and by Regulation D;
and hereafter they will not, either directly or indirectly, sell,
offer for sale, solicit offers to subscribe for or buy, or otherwise
approach or negotiate in respect of, the Securities or any other
interest in the Company prior to or during the Offering Period, except
as provided for in this Agreement, in connection with this Offering.
11. Representations, Warranties and Covenants of Placement Agent.
Placement Agent represents and warrants to and agrees with the Company, at the
date hereof, and as of each Closing, as follows:
a. Placement Agent is duly and validly organized and is a validly
existing Iowa Corporation, is duly licensed as a broker-dealer and
registered as such under the 1934 Act, is a member in good standing of
the NASD, is in compliance with all rules and regulations under the
1934 Act and the NASD Conduct Rules, and is duly registered as a
broker/dealer in every state in which it intends to offer or sell the
Securities.
b. Neither Placement Agent, nor its directors, officers or beneficial
owners of 10% or more of any class of its equity securities, has a
record of conduct which would cause the "bad boy" provisions of Rule
262 of the regulations promulgated under the 1933 Act to apply to the
transactions contemplated by this Agreement.
c. This Agreement has been duly and validly authorized, executed and
delivered by and on behalf of Placement Agent and, except insofar as
the enforceability of the indemnification provision herein may be
subject to challenge and except as enforceability may be limited by
the application of bankruptcy, insolvency, reorganization, moratorium
or other similar laws affecting the rights of creditors generally and
by judicial limitations on the right of specific performance,
constitute the valid and legally binding agreement of Placement Agent.
d. The execution and delivery of this Agreement, the observance and
performance hereof, and the consummation of the transactions
contemplated herein and in the Memorandum, does not and will not
constitute a material
breach or material default under, any instrument or agreement by which
Placement Agent is bound, and does not and will not contravene any
existing material law, decree or order applicable to Placement Agent.
e. Placement Agent has not made and will not make an offer or sale of the
Securities on the basis of any communications or documents relating to
the Company or the Securities, except the Memorandum and the exhibits
thereto, other documents supplied or prepared by the Company and
delivered to potential Purchasers or to Placement Agent for use in
making an offer or sale of the Securities, and any cover or
transmittal letter in respect of the foregoing that has been reviewed
and approved by the Company. Placement Agent will promptly deliver a
copy of each amendment or supplement to the Memorandum to all offerees
then being solicited by it, and to each Purchaser (obtaining from the
latter a confirmation of its, his or her receipt of same).
f. Placement agent will offer and sell the Securities only to Accredited
Investors, as that term is defined in Regulation D, and will retain
appropriate records for a period of four years to evidence Placement
Agent's conduct of the Offering in conformance with the requirements
of that Regulation.
g. In making any offer or sale of the Securities, Placement Agent shall
comply with the provisions of the 1933 Act, the 1934 Act, and the
applicable securities or "blue sky" laws of the jurisdictions in which
Placement Agent makes offers or sales of Preferred Stock.
h. Placement Agent will exercise reasonable care to assure that the
Purchasers to whom it sells the Securities are not underwriters within
the meaning of Section 2(11) of the 1933 Act. In that connection
Placement Agent will: (i) make reasonable inquiry to determine that
the Purchaser is acquiring the Securities for his, her or its own
account for investment purposes; and (ii) obtain from each Purchaser a
signed written agreement (as provided in the Memorandum) that the
Securities will not be sold without registration under the 1933 Act,
in the absence of an opinion of counsel to the Company that an
exemption from registration is available. Such agreement shall
acknowledge the understanding that the Company has no intention to
register the Securities under the 1933 Act, other than as may be
expressly provided in a registration rights agreement between the
Company and the Purchaser.
i. If Placement Agent knows or has reason to believe that a Purchaser to
whom it sells any Security relied upon the advice of a Purchaser
representative as defined in Rule 501(h) of Regulation D in connection
with evaluating the merits and risks of a purchase of the Securities,
Placement Agent will obtain and deliver to the Company (i) the
Purchaser's written acknowledgment that he or she used such
representative in evaluating the merits and risks of the prospective
investment; and (ii) a Purchaser Representative Certificate (in the
form approved by Placement Agent) completed and signed by such
representative.
j. Placement Agent and its authorized agents will offer to sell, or
solicit offers to subscribe for or buy, the Securities only in those
states and other jurisdictions where the Company and counsel have
advised it that it is permitted so to do under applicable law and
regulations.
k. Placement Agent will not offer the Securities for sale or solicit any
offers to purchase the Securities, or otherwise negotiate with any
person in respect of the Securities, on the basis of any
advertisement, article, notice or other communication published in any
newspaper, magazine, or similar medium or broadcast over television or
radio or hold any seminar or meeting with respect to the Securities
whose attendees have been invited by any general solicitation or
general advertising.
12. Additional Covenants of the Company.
The Company hereby covenants and agrees with Placement Agent as follows:
a. The Company will deliver to Placement Agent at its above address, such
additional number of copies of the Memorandum (and any amendments or
supplements thereto), prepared by the Company and approved by
Placement Agent, as the Placement Agent shall reasonably request.
b. The Company shall provide such reasonable cooperation and assistance
to the Placement Agent in the sale of the Securities as Placement
Agent may request.
c. The Company and its employees, affiliates and agents will not at any
time, either directly or indirectly, sell or offer for sale, solicit
offers to subscribe for or buy, or otherwise approach or negotiate in
respect of the sale of the Securities, or any other interest in the
Company, if such activity would cause the Offering
contemplated hereby to not be exempt from the registration provisions
of the 1933 Act and to Regulation D promulgated thereunder, or to
violate the applicable securities or "blue sky" laws of any state or
other jurisdiction that Placement Agent shall reasonably designate as
one in which Placement Agent or any broker/dealer employed by
Placement Agent intends to sell the Securities or offer the Securities
for sale.
d. The Company will use its best efforts in cooperation with Placement
Agent promptly to establish the exemption of the Securities from
qualification or registration under the securities or "blue sky" laws
of such states and jurisdictions as Placement Agent may reasonably
request as those in which Placement Agent or any broker/dealers
employed by it intends to sell the Securities, or offer the Securities
for sale (provided that the Company shall not be required to qualify
to do business in any jurisdiction in which it has not been previously
qualified); it will furnish Placement Agent's counsel with copies of
all written communications and documentation, whether sent or
received, with regard to the foregoing; and Company will pay all
reasonable costs and expenses incurred in connection with the
foregoing.
e. Except as may be otherwise prohibited by applicable "blue sky" laws,
the Company will make available to Placement Agent, and Placement
Agent is authorized on behalf of the Company to make available to each
Purchaser and his or her representatives, including his or her
Purchaser Representative with respect to this investment, prior to the
sale of the Securities to such Purchaser, the opportunity to ask
questions of, and receive answers from the Company concerning the
Company, or the terms and conditions of the Offering which the Company
possesses or can acquire without unreasonable effort or expense that
is necessary to verify the accuracy of the information contained in
the Memorandum and of any other information referred to herein.
f. The Company shall furnish Placement Agent with all information and
data concerning the Company as Placement Agent shall reasonably
request, and will provide Placement Agent with reasonable access to
the Company's officers, directors, employees, independent certified
public accountants and legal counsel.
g. All information made available to Placement Agent by the Company or
any of its officers, directors,
employees, accountants or attorneys will be complete and correct in
all material respects and will not contain any untrue statement of
material fact or, in the aggregate, omit to state a material fact
necessary in order to make the statements made not misleading.
h. During the Interim Offering Period and the Offering Period and for a
period of thirty-six (36) months thereafter, or until such earlier
date as the Company is required to file reports pursuant to Sections
13 or 15(d) of the 1934 Act, the Company will use its best efforts to
furnish directly to Placement Agent, three (3) days prior to the
delivery of such communication to holders of the Securities, each
communication that shall be sent by the Company to the holders of
Securities including, without limitation, any annual or interim
financial or other reports of the Company, at any time sent to the
holders, and shall, in all events, provide such materials to the
Placement Agent not later than it provides such materials to the
holders.
i. If, during the Initial Offering Period, the Offering Period, or at any
time at or prior to any Closing, any event relating to or affecting
the Company or any other event shall come to the attention of the
Company as a result of which it would or might be appropriate to amend
or supplement the Memorandum in order that the Memorandum not contain
an untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading, the
Company will notify Placement Agent immediately of such event and, if
Placement Agent's counsel and counsel for the Company are of the
opinion that it is necessary to amend or supplement the Memorandum,
the Company will forthwith prepare and furnish to Placement Agent a
reasonable number of copies of an amendment or amendments of, or
supplement or supplements to, the Memorandum that will so amend or
supplement the Memorandum, and the same shall be satisfactory in form
and substance to Placement Agent and its counsel. The Company will
promptly furnish to Placement Agent such information with respect to
the Company or the Memorandum as Placement Agent may from time to time
reasonably request.
j. The Company will complete, execute, deliver and file with the SEC such
copies of Form D, as and when required by Rule 503 of Regulation D.
k. The Company has obtained or will obtain any required consents of the
holders of any classes of its
securities to the Offering and the issuance of the Securities on the
terms contemplated hereby.
l. During the Initial Offering Period, the Offering Period, and for a
period of thirty-six (36) months thereafter, or until such earlier
date as the Company is required to file reports pursuant to Sections
13 or 15(d) of the 1934 Act, the Company will furnish directly to
Placement Agent, monthly financial statements, to the extent provided
by the Company to the members of its Board of Directors and
shareholders of the Company.
13. Opinion of Counsel.
The Company agrees to deliver the opinion of the Company's counsel to the effect
that (subject to reasonable qualifications and assumptions):
a. The Company is a corporation validly existing and in good standing as
a corporation under the laws of the State of Delaware and that the
Company retains the requisite corporate power to carry on the business
described in the Memorandum.
b. The execution and delivery of this Agreement and the issuance of the
Interim Promissory Notes and the Promissory Notes will not violate or
conflict with the Certificate of Incorporation or Bylaws of the
Company, or any material agreement known to such counsel to which the
Company is a party.
c. This Agreement has been duly authorized by all requisite corporate
action and executed and delivered by the Company.
d. The Interim Promissory Notes and the Promissory Notes, when executed
and delivered by the Company, have been duly authorized and will
constitute valid, binding and enforceable obligations of the Company
in accordance with their respective terms.
e. The Company has obtained or will obtain any required consents of the
holders of any classes of its securities to the Interim Offering and
the Offering and the issuance of the Interim Promissory Notes and the
Promissory Notes on the terms contemplated herein.
f. Such counsel knows of no litigation or governmental investigation
against the Company.
g. The Interim Offering and the Offering, if the Interim Promissory Notes
and the Promissory Notes are sold only to accredited investors in
transactions not involving any public offering, will be exempt from
registration under the 1933 Act.
14. Conditions of Placement Agent's Obligations.
The Company has entered into an Agreement and Plan of Merger, dated December 19,
2001 among the Company, Xxxxxxx Communications Corporation ("Xxxxxxx"), and a
wholly owned subsidiary of Xxxxxxx. Notwithstanding anything stated elsewhere in
the Agreement, the Company also acknowledges and agrees the Placement Agent is
also engaged by and is the Investment Banker on behalf of Xxxxxxx and further
the Company waives any conflicts of interest or potential conflicts of interest
which may exist on the Placement Agent's part. Placement Agent's obligations
hereunder, and the obligations of Purchasers, are subject to the accuracy of and
compliance with the representations and warranties herein of the Company, to the
observance and performance by the Company of its obligations and covenants
hereunder and as undertaken in the Memorandum, and to the following further
conditions (any of which may be waived in writing in whole or in part by
Placement Agent).
a. As relates to the Interim Offering, there shall have been an account
established for the benefit of the Company, controlled by the
Placement Agent so that, (i) out of the initial $300,000 raised in the
Initial Offering, Placement Agent can direct payment of One Hundred
Twenty Five Thousand Dollars ($125,000) to Xxxxxxx as a loan from
Polar and Twenty Five Thousand Dollars ($25,000) to the Placement
Agent in payment of the Due Diligence Fee pursuant to paragraph 6.b(1)
and (ii) out of the Subsequent Initial Offering the Placement Agent
will direct the payment of Seventy Five Thousand Dollars ($75,000) to
Xxxxxxx as a loan from Polar and Forty Thousand Dollars ($40,000) (or
if less then the entire amount of the Subsequent Interim Offering is
raised then the Ten Percent (10%) fee, pursuant to paragraph 6.b(2)
shall be paid to Placement Agent). Any funds from either the Initial
Interim Offering or the Subsequent Interim Offering not paid to either
Xxxxxxx or the Placement Agent will be paid to the Company.
b. An Escrow Account shall have been established at F&M Bank, into which
will be deposited the proceeds from the Offering. Upon the raise of
the entire $1.5 Million the Placement Agent shall pay out the
following amounts; (i) Two Hundred Eighty Two Thousand Dollars
($282,000) to the Company, (ii) One hundred Thirty Nine Thousand
Dollars ($139,000) to Xxxxxxx as a loan from
Polar and (iii) the commission, expense allowance and fees set out in
paragraph 6.c to the Placement Agent. The remainder of the funds
raised in the Offering shall remain in the Escrow Account until such
time as the Company shall provide verifiable evidence of enforceable
contracts which indicate projected sales in a minimum amount of
Fifteen Million Dollars ($15,000,000) for the first 12 months
following the Offering, said projected revenues being capable of
reasonable verification by Placement Agent (at which time the
remaining amount shall be paid to the Company).
c. The Company shall have engaged Xxxxxxxx, Xxxxx & Company as the
Company's Investment Bankers (or some other reasonably acceptable
firm) to issue a fairness opinion and/or independent report as the
case may be on the prospective merger transaction and a due diligence
report which shall be made available to Purchasers and potential
Purchasers
d. The Company shall provide to the Placement Agent a list of investors
in the Company and the financial status of the said investors so that
the Placement Agent may determine whether or not the said investors
are accredited, for solicitation during the Interim Offering and the
Offering. The Company investor/shareholders and the merger candidate
public company investor/shareholders will only be solicited subject to
their respective accredited investor status.
e. Currently the Company has a lien holder(s) which has a lien on the
Company's technology (the "Lienholder"), the main asset of the
Company. The Company shall obtain the consent of the Lienholder so
that the holders of the Securities are secured by collateral, on a
secondary pari passu basis with the said existing Lienholder and
obtain an agreement with the Lienholder so that the Lienholder agrees
to convert its promissory notes subject to the same terms (other than
conversion rate) as the Securities.
f. After the Initial Closing, Placement Agent may request in writing
certificates dated the date of each Closing, signed by the Company to
the effect that all representations and warranties of the Company
contained herein are true and correct in all material respects with
the same effect as though made expressly at and as of the time of the
Closing.
g. Placement Agent's counsel shall have been furnished promptly, upon
written request, such instruments and
other documents as they may reasonably require for the purpose of
enabling them to pass upon the sale of the Securities as herein
contemplated and in order to evidence the accuracy and completeness in
all material respects of any and all of the representations or
warranties, or the fulfillment of any and all of the conditions,
contained in this Agreement or in the Memorandum, and all such
instruments and other documents shall be reasonably satisfactory in
form and substance to such counsel; all actions taken by the Company
in connection with the sale of the Securities as herein contemplated
shall be reasonably satisfactory to Placement Agent and its counsel;
and the Memorandum (and the supplements or amendments thereto) shall,
at all times during the Offering Period and at the time of each
Closing, be reasonably satisfactory in form and substance to Placement
Agent and its counsel.
h. If any of the conditions specified in this Section shall not have been
fulfilled when and as required by this Agreement to be fulfilled, all
of Placement Agent's obligations under this Agreement may be
terminated in writing or by telegram at any time at or prior to
Closing, except as relating to prior Closings which may have already
occurred, and any such termination shall be without liability to
Placement Agent, provided that the obligations under Sections
10,16,19,23 and 24, hereof shall nevertheless survive and continue
thereafter.
15. Conditions of the Obligations of the Company.
a. At the Initial Closing, the Company shall receive Placement Agent's
certificate, dated the Closing date (i) as to the number of Purchasers
to whom the Securities were sold and (ii) stating that the
representations and warranties contained in Section 11 hereof are true
and correct in all material respects with the same effect as though
made expressly at and as of the time of Closing.
b. Placement Agent shall not have taken or failed to take any action, at
any time at or prior to the Closing, that, in the opinion of the
Company, conflicts or would conflict with, or otherwise make
unavailable, the exemption for the Interim Offering and the Offering
and sale of the Securities from the registration provisions of the
1933 Act afforded by the Act or by Regulation D.
c. If any of the conditions specified in this Section shall not have been
fulfilled when as required by the
Agreement to be fulfilled, all the obligations of the Company, under
this Agreement may be terminated in writing or by telegram at any time
at or prior to the Initial Closing, and any such termination shall be
without liability to the Company provided that the obligations under
Sections 9,11,16,19,23 and 24 hereof shall nevertheless survive and
continue thereafter.
16. Indemnification.
a. The Company agrees to indemnify and hold harmless Placement Agent, and
each person, if any, who controls Placement Agent, and each of
Placement Agent's officers, directors, agents and employees: (i)
against any and all loss, liability, claim, damage and expense
whatsoever arising out of a breach by the Company of any of its
representations and warranties and covenants herein or out of any
untrue statement or alleged untrue statement of a material fact
contained in the Memorandum or any document filed with the securities
agency of any state or other jurisdiction or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading, except to the extent that such untrue
statement or alleged untrue statement or omission or alleged omission
is made in reliance upon and in conformity with written information
furnished Placement Agent or its counsel specifically for use with
reference to Placement Agent or its affiliates in the preparation of
the memorandum or the preparation of any document filed with the
securities agency of any state or other jurisdiction; (ii)against any
and all loss, liability, claim, damage and expense whatsoever to the
extent of the aggregate amount paid in settlement or satisfaction of
any judgment or litigation, commenced or threatened, or of any claim
whatsoever, based upon any breach or untrue or alleged omission
referred to in clause (i) above, if such settlement is effected with
the written consent of the Company; and (iii) against any and all
expense whatsoever incurred in investigating, preparing or defending
against any litigation, commenced or threatened, or and claim
whatsoever, based upon any breach or untrue statement or omission, or
any alleged untrue statement or omission, referred to in clause (i)or
(ii) above, to the extent that any such expense is not paid under
clause (i)or (ii) above.
b. Placement Agent agrees to indemnify and hold harmless the Company's
officers, directors, agents, employees and controlling persons (within
the meaning of the 1933
Act); (i) against any and all loss, liability, claim, damage and
expense whatsoever arising out of Placement Agent's breach of any of
its representations and warranties and covenants herein or out of any
untrue statement or alleged untrue statement of a material fact
contained in the Memorandum or any document filed with the securities
agency of any state or other jurisdiction or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading, to the extent such untrue statement or
omission conforms to information furnished in writing by Placement
Agent or on its behalf specifically for inclusion in the Memorandum;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever to the extent of the aggregate amount paid in settlement or
satisfaction of any judgment or litigation, commenced or threatened,
or of any claim whatsoever, based upon any breach or untrue or alleged
untrue statement or omission or alleged omission referred to in clause
(i)above, if such settlement is effected with Placement Agent's
written consent; and (iii)against any and all expenses whatsoever
incurred in investigating, preparing or defending against any
litigation, commenced or threatened, or any claim whatsoever based
upon any breach or untrue statement or omission, or any alleged untrue
statement or omission referred top in clauses (i) or (ii) above, to
the extent that any such expense is not paid under clause (i) or (ii)
above.
c. If the preceding provisions of this Section or any portion thereof or
the application thereof to any person or circumstances shall to any
extent be invalid or unenforceable, the parties hereto hereby agree
that a right of contribution shall exist on the part of the party that
otherwise would have been the indemnified party under the aforesaid
provisions (hereinafter referred to as "Contribution Recipient") to
the extent necessary to reflect the relative benefits received by the
Company and the Placement Agent from the offering of the Securities.
The relative benefits received by the Company and the Placement Agent
shall be deemed to be in the same proportion as the total net proceeds
from the Interim Offering and the Offering received by the Company
bear to the expenses reimbursements, commissions and other
compensation paid to the Placement Agent. No person guilty of a
fraudulent misrepresentation shall be entitled to contribution from
any person not guilty of fraudulent misrepresentation.
d. Within a reasonable time after the assertion of any claim against any
party hereto (or any person who controls such party) in connection
with the Interim Offering, the Offering or sale of the Securities,
such party shall give notice of such claim to the other parties
hereto. An indemnifying party or contributor under this Section shall
have the right to direct, at such party's own expenses and through
counsel of such party's own choosing, the contest and defense against
any such claim and in any litigation, proceedings or settlement
negotiation with respect thereto. The indemnity set forth in this
Section shall be in addition to any liability that either of the
parties hereto may otherwise have.
e. No indemnification shall be available to any party hereunder in any
instance in which liability of that party is found by a court or
arbitrator of competent jurisdiction to have resulted primarily and
directly from gross negligence or willful misconduct.
17. Termination.
a. Placement Agent may terminate this Agreement at any time in writing or
by telegram at any time at or prior to the Initial Closing and any
such termination shall be without further liability of either party to
the other, provided that the obligations under Sections 10,16,19,23
and 24 shall nevertheless survive and continue thereafter.
b. Except as otherwise provided herein, the agency of Placement Agent
hereunder, which is coupled with an interest, is not terminable by the
Company without Placement Agent's written consent. The Company may
terminate this Agreement only by written notice to Placement Agent and
by refusal to accept any proceeds of this Offering. The Company may
not terminate this Agreement if it has accepted any proceeds of the
Offering at a Closing as a result of the efforts of Placement Agent.
c. If the Company terminates this Agreement, and within twelve (12)
months following the termination, the Company either (i) obtains
financing of any kind from contacts introduced to the Company by
Placement Agent or its agents during the Term of this Offering or (ii)
sells its assets to contacts introduced to the Company (or affiliates
of such contacts) by Placement Agent, the Company shall pay to
Placement Agent a fee of Ten percent (10%) of the amount of any
financing or the selling price, provided that loans to the Company
having a maturity of more than one year shall be included in the
consideration received by the Company. Within 30 days after the
termination of this Agreement by the Company, Placement Agent shall
provide the Company a list of contacts introduced to the Company by
Placement Agent.
d. If this Agreement is terminated by the Company for any reason other
than a breach by Placement Agent of its obligations hereunder, the
obligations under Sections 9,11,16,19,23 and 24 and this Section shall
nevertheless survive and continue thereafter.
18. Sole Agreement of the Parties.
This Agreement represents the sole agreement of the parties with respect to the
subject matter set forth herein, and supersedes all other agreements of the
parties as to the subject matter.
19. Representations, Warranties and Agreements to Survive Closing.
All representations, warranties covenants and agreements contained in this
Agreement or contained in certificates submitted pursuant thereto shall remain
operative and in full force and effect, regardless of any investigation made by
or on behalf of placement Agent or any person who controls Placement Agent, or
by or on behalf of the Company, or any person who controls the Company.
20. Notices.
All communications hereunder shall be in writing and, if sent to Placement
Agent, shall be mailed (by U.S. certified mail, return receipt requested),
delivered, telecopied, telexed, or telegraphed:
If to Placement Agent: Xxxxxxx Xxxxxx & Company
Financial Services, Inc
000 Xxxx Xxxxxx, Xxx 000
Xxxxxx, Xxxx 00000
Attn: President
If to the Company: Polar Molecular Corporation
0000 X. Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attn: President
or to either party at such other address as such party shall designate by notice
given as hereinabove provided.
Communications shall be deemed given upon receipt and may be given by counsel
for the party serving the same.
21. Parties.
This Agreement shall inure to the benefit of and be binding upon Placement
Agent, the Company and the conditions and provisions hereof are intended to be
and are for the sole and exclusive benefit of the parties hereto and their
respective successors, and for the benefit of no other person, except as
otherwise herein specifically provided.
22. Nature of Obligation.
The obligations of Placement Agent to the Company shall be solely those
contractual obligations provided in this Agreement. No fiduciary relationship is
created hereby. Placement Agent may not bind the Company to any contract.
23. Arbitration.
Any controversy or claim arising out of or relating to this Agreement or breach
thereof shall be settled by final and binding arbitration, in accordance with
the arbitration rules of the American Arbitration Association, and judgment upon
the award rendered by the arbitrator may be entered in any court having
jurisdiction, including a United States District Court, pursuant to the Federal
Arbitration Act. The cost of the arbitrator shall be shared equally by the
parties. The parties recognize that this paragraph means that certain claims
will be litigated and reviewed before an impartial arbitrator instead of before
a court of law and/or jury, but desire the many benefits of the arbitration
process over court proceedings, including speed of resolution, lower costs and
fees, and more flexible rules of evidence.
25. Governing Law.
This Agreement shall be governed by, and construed in accordance with, the laws
of the State of Iowa applicable to agreements under seal made and to be
performed wholly within such state.
26. Counterparts.
This Agreement may be executed in a number of counterparts, all of which
together shall for all purposes constitute one agreement, binding on all parties
notwithstanding that all parties have not signed the same counterpart.
27. Non-Assignability.
This Agreement may not be assigned by either party (in whole or in part) without
the prior written consent of the other party.
28. Miscellaneous.
All titles or captions herein are for convenience only and shall not be deemed a
part hereof. All pronouns and any variations thereof shall be deemed to refer to
the masculine, feminine, neuter, singular or plural, as the identity of the
person or persons or entity may require. The terms "person" and "persons" shall
include reference to individuals, partnerships, corporations, trusts and other
entities. The terms `law" and "laws" shall include, without limitation, any
rules and regulations promulgated under a statute. Any payment of a sum to be
made hereunder by the Company to Placement Agent shall be made by check payable
to the order of Placement Agent.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
Polar Molecular Corporation
Name: /s/ Xxxx X. Xxxxxx
------------------------------
Title: President-CEO
Xxxxxxx Xxxxxx & Company
Financial Services, Inc.
Name: /s/ Xxxxxx X. Xxxxxxx
------------------------------
Title: CEO
AMENDMENT A
This Amendment A (the "Amendment") is attached to and made a part of that
Placement Agreement dated as of December 21, 2001 (the "Agreement") which was
executed by and between Xxxxxxx Xxxxxx & Company Financial Services, Inc.
(Placement Agent) and Polar Molecular Corporation (the "Company").
All terms defined in the Agreement will have the same meaning when used in this
Amendment.
Whereas, the parties desire to amend several of the terms of the Agreement.
Now Therefore, in consideration of the foregoing, and for other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
agree as follows:
1. The first WHEREAS paragraph on page 1 of the Agreement shall be
amended by deleting the paragraph in its entirety and replacing it
with the following:
"WHEREAS, the Company has entered into an Agreement And Plan of Merger
(the "Merger Agreement") among itself, Xxxxxxx Communications
Corporation ("Xxxxxxx") and a wholly owned subsidiary of Xxxxxxx; and
2. In the forth WHEREAS paragraph on page 1 of the Agreement, the
numerical reference to One Million Five Hundred Thousand Dollars shall
be "$1,500,000" rather than "$1,5000,000".
3. Paragraph 2.a. of the Agreement shall be deleted in its entirety and
shall be replaced with the following:
"This Agreement shall be effective and the Interim Offering Period
shall commence upon execution. The Interim Offering Period shall
terminate at the close of business February 28, 2002 (the "Interim
Offering Termination Date) and may be extended by the mutual agreement
of the Company and the Placement Agent for an additional thirty (30)
days (or shorter) period in which case the term Interim Offering
Termination Date shall include the later date."
4. Paragraph 4.c. of the Agreement shall be amended in the following
manner:
In the forth line of the paragraph the phrase "shall be mandatorily
convertible" shall be deleted and replaced with the phrase "may be
convertible".
5. Paragraph 4 of the Agreement shall be amended by adding the following
new subparagraph d.
"In addition to the Interim Promissory Notes and the Promissory Notes
described above, as a part of the Interim Offering and the Offering,
the Company will also issue Warrants to the Investors (the
"Warrants"), which will grant to Investors the right to purchase the
number of shares of Common stock of the Company equal to the number of
shares of Common Stock into which the related Interim Promissory Notes
or the Promissory Notes may be converted."
6. Paragraph 6.d. of the Agreement shall become paragraph 6e. and the
fo1lowing shall be added as the new paragraph 6d.
"As compensation for Placement Agent's services with respect to
investors who have received Warrants as a result of investing in the
Interim Offering and in the Offering, the Company agrees to pay to the
Placement Agent a commission in an amount equal to ten percent (10%)
of the gross cash proceeds from the purchase of the Companies Common
Stock as the result of the exercise of the Warrants (other than
Warrants issued due to the direct efforts of the Company), said
commission shall be paid to the Placement Agent within 5 days of the
exercise by any investor."
7. Paragraph 6.d. of the Agreement shall become paragraph 6e., and the
former Paragraph 6.d. shall be amended by deleting the paragraph in
its entirety and replacing it with the following.
"As further compensation for Placement Agent's services in finding
subscribers for the Securities sold during the Interim Offering and
the Offering, at the Closings, the Company hereby agrees to deliver to
the Placement Agent warrants (the "Placement Agent Warrants") for the
purchase of the number of shares of common stock of the Company equal
to 10% of the total number of shares of Common Stock issuable upon
conversion of the Interim Promissory Notes (other than Interim
Promissory Notes issued due to the direct efforts of the Company) and
the Promissory Notes issued as a result of the Interim Offering and
the Offering respectively. The Placement Agent Warrants shall have an
exercise price equal to 120% of the conversion price of the Common
Stock subject to the Interim Promissory Notes and the Promissory Notes
offered in the Interim Offering and the Offering, respectively, at the
time of the Closings. The Placement Agent Warrants shall expire three
years from the date of
issuance and shall contain the normal terms and conditions of warrants
of this size and type, which shall include but not necessarily be
limited to the right to a cashless exercise, piggyback registrations
rights and standard anti dilution provisions."
8. Paragraph 14.b. of the Agreement shall be amended by deleting the
paragraph in its entirety and replacing it with the following:
"An Escrow Account shall have been established at F&M Bank, into which
will be deposited the proceeds from the Offering. As funds are raised
for the Offering, there will be Closings held, which are expected to
be weekly but will not be held unless there is at least a minimum of
Fifty Thousand Dollars ($50,000) of funds raised. Only one legal
opinion will be required for the offering as a whole. At each Closing,
the Placement Agent shall pay out the proceeds to be distributed at
the Closing in the following manner: (i) the applicable commission,
expense allowance and fees set out in paragraph 6.c to the Placement
Agent and Xxxxxxxx, Xxxxx & Company (or other firm, as selected above)
and (ii) the remainder of the funds shall be divided one third (the
"First Proceeds Amount", i.e., the gross proceeds raised minus
commissions, expense allowance and fees) and two thirds (the "Second
Proceeds Amount"). The First Proceeds Amount shall be immediately
released to Polar who in turn will loan one third of that amount to
Xxxxxxx and the remainder will be retained by Polar. The Second
Proceeds Amount shall remain in the Escrow Account until such time as
the Company shall provide to the Placement Agent, verifiable evidence
of enforceable contracts which indicate sales in a minimum amount of
One Million Five Hundred Thousand Dollars ($1,500,000), as indicated
in the Memorandum, for the first 12 months following the Offering,
said revenues being capable of reasonable verification by Placement
Agent (it is expected that the verifiable evidence shall be an
executed and enforceable Purchase Order). Upon receipt by the
Placement Agent of the said verifiable evidence, the Placement Agent
shall release the Second Proceeds Amount from the Escrow Account to
the Company which in turn will loan one third of that amount to
Xxxxxxx and the remainder shall be retained by the Company.
9. Paragraph 14.e. of the Agreement shall be amended in the following
manner:
The last sentence in the paragraph shall be deleted and replaced with
the following:
"The company shall obtain (i) the consent of the Lienholder so that
the holders of the Securities may be secured by collateral, on a
secondary pari passu basis with the said existing Lienholder and (ii)
an agreement with the Lienholder which is reasonably satisfactory to
the Company and the Placement Agent.
All other terms and conditions in the Agreement will remain the same.
In Witness Whereof, the parties hereto execute this Amendment as of the day and
date set out above.
Xxxxxxx Xxxxxx & Company Polar Molecular Corporation
Financial Services, Inc.
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxxx
---------------------------- --------------------------------
Title: CEO Title: President-CEO
AMENDMENT B
This Amendment B (the "Amendment") , dated as of February 28, 2002, is attached
to and made a part of that Placement Agreement dated as of December 21, 2001, as
amended pursuant to Amendment A dated as of December 21, 2001 (the "Amended
Agreement"), both of which were executed by and between Xxxxxxx Xxxxxx & Company
Financial Services, Inc. (Placement Agent) and Polar Molecular Corporation (the
"Company").
All terms defined in the Amended Agreement will have the same meaning when used
in this Amendment.
Whereas, the parties desire to extend the terms of the Interim Offering.
Now Therefore, in consideration of the foregoing, and for other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
agree as follows:
1. Pursuant to the terms of the Amended Agreement, the parties agree that
the term of the Interim Offering is extended thirty (30) days beyond
the Interim Offering Termination Date until March 28, 2002 and
therefore the Interim Offering Termination Date shall include the
later date.
2. Placement Agent has been informed that Company will be required to
book an expense as the result of the recent issuance of Company common
stock/options to officers and directors of the Company (the "Common
Stock"). Placement Agent is willing to accept and agree to a reduction
in the equity section on the balance sheet of the Company related to
the issuance of the Common Stock, which has been issued within twenty
four months preceding the merger between the Company and Xxxxxxx
Communications Corporation, so long as such adjustment(s) does not
exceed Three Hundred Fifty Thousand Dollars ($350,000). In the event
that the Company is required to make an adjustment(s) to its financial
statements to account for the issuance of the Common Stock, then the
Company agrees to take whatever action necessary so the total
adjustment to the Company financial statement(s) will reduce the
Company's equity section on the balance sheet by no more than
$350,000. In addition, the Company agrees that the provision stated in
this paragraph will be incorporated into an amendment to the Merger
Agreement executed between the Company and Xxxxxxx Communications
Corporation.
3. Clause (i) of the fourth sentence of Paragraph 14.b of the Amended
Agreement is hereby amended to read as follows:
"(i) (A) the applicable commission, expense allowance and fees
set out in paragraph 6.c to the Placement Agent and Xxxxxxxx,
Xxxxx & Company (or other firm, as selected above) and (B) the
fees and expenses of counsel to Polar in connection with this
Agreement, the Initial Offering and the Offering, the Merger
Agreement and the transactions contemplated thereby and".
All other terms and conditions in the Amended Agreement will remain the same.
In Witness Whereof, the parties hereto execute this Amendment as of the day and
date first set out above.
Xxxxxxx Xxxxxx & Company Polar Molecular Corporation
Financial Services, Inc.
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxxx
---------------------------- --------------------------------
Title: CEO Title: CEO
AMENDMENT C
This Amendment C (the "Amendment"), dated as of March 27, 2002, is attached to
and made a part of that Placement Agreement dated as of December 21, 200l, as
amended pursuant to Amendment A dated as of December 21, 2001 and Amendment B
dated as of February 28, 2002 (the "Amended Agreement) , each of which were
executed by and between Xxxxxxx Xxxxxx & Company Financial Services, Inc.
(Placement Agent) and Polar Molecular Corporation (the "Company")
All terms defined in the Amended Agreement will have the same meaning when used
in this Amendment.
Whereas, the parties desire to extend and expand the terms of the Interim
Offering.
Now Therefore, in consideration of the foregoing, and for other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
agree as follows:
1. Pursuant to the terms of the Amended Agreement, the parties agree that (i)
the Interim Offering shall be extended until April 30, 2002, and the
Interim Offering Termination Date shall include such later applicable date,
and (ii) the principal amount of Interim Promissory Notes (and the total
exercise price of Warrants) to be offered during the Interim Offering is to
be increased from $700,000 to $1,500,000.
2. The proceeds of the first $700,000 of the Interim Offering shall be
distributed as previously indicated. The final $800,000 of proceeds from
the Interim Offering shall be distributed, first, to pay (A) the applicable
commission, expense allowance and fees set out in paragraph 6.c to the
Placement Agent and Houhlihan, Xxxxx & Company (or other firm, as selected
in the Amended Agreement) , as if the Interim Offering was the Offering,
and (B) Holme Xxxxxxx & Xxxx LLP for fees and expenses incurred (but not
yet paid) by the Company (x) in connection with the Amended Agreement and
this Amendment, the Interim Offering and the Offering, the Merger Agreement
and the transactions contemplated thereby and (y) for other matters in
2001, and, second, two-thirds of the remaining net proceeds shall be
distributed to the Company and one-third of the remaining net proceeds
shall be distributed as a loan from the Company to Xxxxxxx (with the same
terms as the other loans to Xxxxxxx under the Amended Agreement, and with a
use of proceeds by Xxxxxxx that is approved in advance by the Company (not
to be unreasonably withheld), provided that any use designed to allow
Xxxxxxx to meet its Net Worth Test under Section 5.15 of the Merger
Agreement shall be an
approved use). Furthermore, the Company shall loan to Xxxxxxx one-third of
the net proceeds (after 10% commissions to Placement Agent) received by the
Company upon exercise of the Warrants, until the aggregate loan to Xxxxxxx
by the Company under the terms of the Amended Agreement and this Amendment
is equal to $620,750; this loan shall be on the same terms as the other
loans to Xxxxxxx under the Amended Agreement and this Amendment, shall have
a use of proceeds by Xxxxxxx that is approved in advance by the Company
(not to be unreasonably withheld, provided that any use designed to allow
Xxxxxxx to meet its Net Worth Test under Section 5.15 of the Merger
Agreement shall be an approved use).
3. Paragraph 4.d. of the Amended Agreement shall be amended in its entirety to
read as follows:
"In addition to the Interim Promissory Notes described above, as a part of
the Interim Offering, the Company will also issue Warrants to the Investors
(the "Warrants"), which will grant to Investors the right to purchase, at
an exercise price of $0.585 per share, the number of shares of Common Stock
of the Company equal to twice the number of shares of Common Stock into
which the related Interim Promissory Notes may be converted."
4. Paragraph 6.e of the Amended Agreement shall be amended in its entirety to
read as follows:
"As further compensation for Placement Agent's services in finding
subscribers for the Interim Promissory Notes sold during the Interim
Offering, at the Closings, the Company hereby agrees to deliver to the
Placement Agent warrants (the "Placement Agent Warrants") for the purchase
of the number of shares of Common Stock of the Company equal to 10% of the
total number of shares of Common Stock issuable upon conversion of the
Interim Promissory Notes (other than Interim Promissory Notes issued due to
the direct efforts of the Company) as a result of the Interim Offering. The
Placement Agent Warrants shall have an exercise price equal to 120% of the
conversion price of the Common Stock subject to the Interim Promissory
Notes offered in the Interim Offering. The Placement Agent Warrants shall
expire three years from the date of issuance and shall contain the normal
terms and conditions of warrants of this size and type, which shall include
but not necessarily be limited to the right of cashless exercise, piggyback
registrations rights and standard anti dilution provisions. As further
compensation for Placement Agent's agreement to use its best efforts to
find subscribers for an additional (i.e., above and beyond the first
$700,000 of Interim Promissory Notes sold during the Interim Offering)
$800,000 of Interim
2
Promissory Notes (the "Additional Notes") , the Company hereby agrees to
(i) immediately deliver 100,000 shares of Common Stock to Placement Agent
and (ii) deliver a further 100,000 shares to Placement Agent in the event
that the Placement Agent finds (and receives signed purchase commitments
from) subscribers for at least $500,000 of the Additional Notes on or prior
to April 30, 2002."
All other terms and conditions in the Amended Agreement will remain the same.
3
In Witness Whereof, the parties hereto execute this Amendment as of the day and
date first set out above.
Xxxxxxx Xxxxxx & Company Polar Molecular Corporation
Financial Services, Inc.
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxxx
---------------------------- --------------------------------
Title: CEO Title: President-CEO
4-5-02
3
AMENDMENT D
This Amendment D (the "Amendment") dated as of April 30, 2002, is attached to
and made a part of that Placement Agreement dated as of December 21, 2001 (the
"Placement Agreement") which was amended pursuant to an Amendment A dated as of
December 21, 2001 (the "Amendment A") , which was amended pursuant to an
Amendment B dated as of February 28, 2002 (Amendment B") and which was amended
pursuant to an Amendment C dated as of March 27, 2002 ("Amendment C"), all of
which were executed by and between Xxxxxxx Xxxxxx & Company Financial Services,
Inc. (Placement Agent) and Polar Molecular Corporation (the "Company")
(collectively the Placement Agreement, the Amendment A and the Amendment B shall
be referred to as the "Amended Agreement").
All terms defined in the Amended Agreement will have the same meaning when used
in this Amendment.
Whereas, the parties desire to amend the terms of the Amended Agreement.
Now Therefore, in consideration of the foregoing, and for other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
agree as follows:
1. Pursuant to the terms of the Amended Agreement, the parties agree that
the Interim Offering shall be extended until May 15, 2002 and the Interim
Offering Termination Date shall include such later applicable date.
2. Paragraph 6.e. of the Amended Agreement shall be amended by deleting the
reference to "April 30, 2002" at the end of the paragraph and replacing it
with "May 15, 2002".
All other terms and conditions of the Amended Agreement will remain the same
In Witness Whereof, the parties hereto execute this Amendment as of the day and
date set out above
Xxxxxxx Xxxxxx & Company Polar Molecular Corporation
Financial Services, Inc.
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxxx
--------------------------- --------------------------------
Title: CEO Title: Pres-CEO
AMENDMENT E
This Amendment E (the "Amendment") dated as of May 15, 2002, is attached to and
made a part of that Placement Agreement dated as of December 21, 2001 (the
"Placement Agreement") which was amended pursuant to an Amendment A dated as of
December 21, 2001 (the "Amendment A"), which was amended pursuant to an
Amendment B dated as of February 28, 2002 (Amendment B"), which was amended
pursuant to an Amendment C dated as of March 27, 2002 ("Amendment C") and which
was amended pursuant to an Amendment D dated as of April 30, 2002 ("Amendment
D"), all of which were executed by and between Xxxxxxx Xxxxxx & Company
Financial Services, Inc. (Placement Agent) and Polar Molecular Corporation (the
"Company") (collectively the Placement Agreement, the Amendment A, the Amendment
B, the Amendment C and the Amendment D shall be referred to as the "Amended
Agreement").
All terms defined in the Amended Agreement will have the same meaning when used
in this Amendment.
Whereas, the parties desire to amend the terms of the Amended Agreement.
Now Therefore, in consideration of the foregoing, and for other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
agree as follows:
1. Pursuant to the terms of the Amended Agreement, the parties agree that
the Interim Offering shall be extended for an additional 30 days, until
June 14, 2002, with the right to extend the Agreement for two additional 30
day periods by mutual agreement of the parties, and the Interim Offering
Termination Date shall include such later applicable date.
2. Paragraph 6.e. of the Amended Agreement shall be amended by deleting the
reference to "May 15, 2002" at the end of the paragraph and replacing it
with "June 14, 2002".
All other terms and conditions of the Amended Agreement will remain the same
In Witness Whereof, the parties hereto execute this Amendment as of the day and
date set out above
Xxxxxxx Xxxxxx & Company Polar Molecular Corporation
Financial Services, Inc.
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxxx
---------------------------- --------------------------------
Title: CEO Title: President-CEO
AMENDMENT F
This Amendment F (the "Amendment") dated as of June 13, 2002, is attached to and
made a part of that Placement Agreement dated as of December 21, 2001 (the
"Placement Agreement") which was amended pursuant to an Amendment A dated as of
December 21, 2001 (the "Amendment A"), which was amended pursuant to an
Amendment B dated as of February 28, 2002 ("Amendment B"), which was amended
pursuant to an Amendment C dated as of March 27, 2002 ("Amendment C"), which was
amended pursuant to an Amendment D dated as of April 30, 2002 ("Amendment D"),
and Amendment E dated as of May 15, 2002 all of which were executed by and
between Xxxxxxx Xxxxxx & Company Financial Services, Inc. (Placement Agent) and
Polar Molecular Corporation (the "Company") (collectively the Placement
Agreement, the Amendment A, the Amendment B, the Amendment C, the Amendment D
and Amendment A shall be referred to as the "Amended Agreement").
All terms defined in the amended Agreement will have the same meaning when used
in this Amendment.
Whereas, the parties desire to amend the terms of the Amended Agreement.
Now Therefore, in consideration of the foregoing, and for other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
agree as follows:
1. Pursuant to the terms of the Amended Agreement, the parties agree that the
Interim Offering shall be extended for an additional 30 days, until July
14, 2002, with the right to extend the Agreement for two additional 30 day
periods by mutual agreement of the parties, and the Interim Offering
Termination Date shall include such later applicable date.
2. Paragraph 6.e. of the Amended Agreement shall be amended by deleting the
reference to "June 14, 2002" at the end of the paragraph and replacing it
with "July 14, 2002".
All other terms and conditions of the Amended Agreement will remain the same
In Witness Whereof, the parties hereto execute this Amendment as of the day and
date set out above
Xxxxxxx Xxxxxx & Company Polar Molecular Corporation
Financial Services, Inc.
By: /s/ Xxxxxx X. Xxxxxxx, President By: /s/ Xxxx X. Xxxxxx
--------------------------------- --------------------------------
AMENDMENT G
This Amendment G (the "Amendment") dated as of July 12, 2002, is attached to and
made a part of that Placement Agreement dated as of December 21, 2001 (the
"Placement Agreement") which was amended pursuant to an Amendment A dated as of
December 21, 2001 (the "Amendment A") , which was amended pursuant to an
Amendment B dated as of February 28, 2002 ("Amendment B"), which was amended
pursuant to an Amendment C dated as of March 27, 2002 ("Amendment C"), which was
amended pursuant to an Amendment D dated as of April 30, 2002 ("Amendment D"),
which was amended pursuant to an Amendment E dated as of May 15, 2002
("Amendment E") and an Amendment F dated as of June 13, 2002 ("Amendment G"),
all of which were executed by and between Xxxxxxx Xxxxxx & Company Financial
Services, Inc. (Placement Agent) and Polar Molecular Corporation (the "Company")
(collectively the Placement Agreement, the Amendment A, the Amendment B, the
Amendment C, the Amendment D, the Amendment F and Amendment G shall be referred
to as the "Amended Agreement").
All terms defined in the Amended Agreement will have the same meaning when used
in this Amendment.
Whereas, the parties desire to amend the terms of the Amended Agreement.
Now Therefore, in consideration of the foregoing, and for other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
agree as follows:
1. Pursuant to the terms of the Amended Agreement, the parties agree that the
Interim Offering shall be extended for an additional 48 days, until August
31, 2002, with the right to extend the Agreement for two additional 30 day
periods by mutual agreement of the parties, and the Interim Offering
Termination Date shall include such later applicable date.
2. Paragraph 6.e. of the Amended Agreement shall be amended by deleting the
reference to "June 14, 2002" at the end of the paragraph and replacing it
with "August 31, 2002".
All other terms and conditions of the Amended Agreement will remain the same
In Witness Whereof, the parties hereto execute this Amendment as of the day and
date set out above.
Xxxxxxx Xxxxxx & Company Polar Molecular Corporation
Financial Services, Inc.
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxxx
---------------------------- --------------------------------
Title: President Title: President & CEO
AMENDMENT H
This Amendment G (the "Amendment") dated as of August , 2002, is attached to
--
and made a part of that Placement Agreement dated as of December 21, 2001 (the
"Placement Agreement") which was amended pursuant to an Amendment A dated as of
December 21, 2001 (the "Amendment A"), which was amended pursuant to an
Amendment B dated as of February 28, 2002 ("Amendment B"), which was amended
pursuant to an Amendment C dated as of March 27, 2002 ("Amendment C"), which was
amended pursuant to an Amendment D dated as of April 30, 2002 ("Amendment D"),
and Amendment E dated as of May 15, 2002 ("Amendment E"), which was amended
pursuant to an Amendment F dated as of June 13, 2002 ("Amendment F") and an
Amendment G dated as of July 12, 2002 ("Amendment G"), all of which were
executed by and between Xxxxxxx Xxxxxx & Company Financial Services, Inc.
(Placement Agent) and Polar Molecular Corporation (the "Company") (collectively
the Placement Agreement, the Amendment A, the Amendment B, the Amendment C, the
Amendment D, the Amendment E, the Amendment F, the Amendment G and Amendment H
shall be referred to as the "Amended Agreement").
All terms defined in the amended Agreement will have the same meaning when used
in this Amendment.
Whereas, the parties desire to amend the terms of the Amended Agreement.
Now Therefore, in consideration of the foregoing, and for other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
agree as follows:
1. Pursuant to the terms of the Amended Agreement, the parties agree that the
Interim Offering shall be extended for an additional 60 days, until October
30, 2002, with the right to extend the Agreement for two additional 30 day
periods by mutual agreement of the parties, and the Interim Offering
Termination Date shall include such later applicable date.
2. Paragraph 6.e. of the Amended Agreement shall be amended by deleting the
reference to "August 31, 2002" at the end of the paragraph and replacing it
with "September 30, 2002".
All other terms and conditions of the Amended Agreement will remain the same
In Witness Whereof, the parties hereto execute this Amendment as of the day and
date set out above.
Xxxxxxx Xxxxxx & Company Polar Molecular Corporation
Financial Services, Inc.
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxx Xxxxxx
---------------------------- --------------------------------
Title: President Title: President
AMENDMENT I
This Amendment I (the "Amendment") dated as of September 30, 2002, is attached
to and made a part of that Placement Agreement dated as of December 21, 2001
(the "Placement Agreement") which was amended pursuant to an Amendment A dated
as of December 21, 2001 (the "Amendment A"), which was amended pursuant to an
Amendment B dated as of February 28, 2002 ("Amendment B"), which was amended
pursuant to an Amendment C dated as of March 27, 2002 ("Amendment C") which was
amended pursuant to an Amendment D dated as of April 30, 2002 ("Amendment D"),
which was amended pursuant to an Amendment E dated as of May 15, 2002
("Amendment E"), which was amended pursuant to an Amendment F dated as of June
13, 2002 ("Amendment F"), which was amended pursuant to an Amendment G dated as
of July 12, 2002 ("Amendment G") and an Amendment H dated as of August 30, 2002,
all of which were executed by and between Xxxxxxx Xxxxxx & Company Financial
Services, Inc. (Placement Agent) and Polar Molecular Corporation (the "Company")
(collectively the Placement Agreement, the Amendment A, the Amendment B, the
Amendment C, the Amendment D, the Amendment E, the Amendment F, the Amendment G,
the Amendment H and the Amendment I shall be referred to as the "Amended
Agreement").
All terms defined in the Amended Agreement will have the same meaning when used
in this Amendment.
Whereas, the parties desire to amend the terms of the Amended Agreement.
Whereas the parties acknowledge that the 1.5 Million Dollar Interim Offering has
been completed; and
Whereas, the parties desire to initiate and complete an additional offering in
an amount up to Seven Hundred Thousand and No/100 Dollars ($700,000) (the
"Additional Offering")
Now Therefore, in consideration of the foregoing, and for other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
agree as follows:
1. Pursuant to the terms of the Amended Agreement, the parties agree that
the Interim Offering and the Additional Offering shall be extended for an
additional 57 days, until November 27, 2002, with the right to extend the
Agreement for two additional 30 day periods by mutual agreement of the
parties, and the Interim Offering Termination Date and the date for the
termination of the Additional Offering (the "Additional Offering
Termination Date") shall include such later applicable date. The Company
will provide an Amendment/Supplement, as the case may be, to the
1
Confidential Private Placement Memorandum dated January 30, 2002 and the
Cumulative Supplement and Addendum to Confidential Private Placement
Memorandum dated April 11, 2002, which will provide necessary information
to potential investors, including but not necessarily limited to the fact
that the Interim Offering of $1.5 Million Dollars has been sold out and
that the parties agree to initiate an Additional Offering in the amount of
Seven Hundred Thousand Dollars ($700,000) (the "Supplement").
2. Paragraph 6.e. of the Amended Agreement shall be amended by deleting the
reference to "September 30, 2002" at the end of the paragraph and replacing
it with "November 27, 2002".
3. In order for the Placement Agent to use its best efforts to go forward
with the Additional Offering the parties agree to the following timeline:
A. On or before November 27, 2002, the Company, in cooperation with
Xxxxxxx Communications Corporation ("Xxxxxxx"), will have filed
the S-4 regarding the merger of the Company and Xxxxxxx;
B. The Supplement will be completed and forwarded to the Placement
Agent no later than November 7, 2002, in order that the Placement
Agent may continue to put forth its best efforts to complete the
Additional Offering;
C. At or prior to the final closing for the Additional Offering, the
Company will produce a letter or some other acceptable evidence
from Total-Fina-Elf ("TFE"), in which TFE acknowledges that it
intends to place an order for the Company product;
D. On or before the final closing of the Additional Offering, the
Company, through its attorneys, will complete and present to
Xxxxxxx a revised and amended Merger Agreement, acceptable to
Xxxxxxx, which corresponds to the new dates of the proposed
Merger.
4. The parties agree, that out of the funds that are raised in the
Additional Offering, the first Seventy Five Thousand Dollars of funds
raised, after the payment of Placement Agent fees and commissions, will be
paid to the Company's accountants and attorneys. In exchange for payment of
said funds the Company will produce evidence from the Company's accountants
and attorneys that said accountants and attorneys will continue to work
with the Company to do all work reasonable and necessary in order to
complete the Offering and the proposed merger of the
2
Company with Xxxxxxx, including but not necessarily limited to filing of a
Registration Statement prior to the closing of the merger between the
Company and Xxxxxxx, without requiring additional payment until the Merger
closing.
5. The Company agrees that out of the net proceeds raised from the exercise
of Warrants resulting from the Interim Offering and/or the Additional
Offering, after payment of Placement Agent fees and commissions, the
Company will loan to Xxxxxxx one third of the amount raised. Furthermore,
assuming the full $700,000 is raised in the Additional Offering, the
Company will loan to Xxxxxxx $190,000 of the net proceeds of the Additional
Offering. If less than the full $700,000 is raised in the Additional
Offering, the Company will loan to Xxxxxxx 19/52 of any net proceeds (i.e.,
following payment of Placement Agent fees and commissions) from the
Additional Offering after payment of the amounts set forth in Paragraph 4
hereof.
6. At or prior to the closing of the Merger the Company will use it s
reasonable best efforts to have either paid off or converted, to Company
Common Stock, any and all outstanding accounts payable/debt obligations,
including but not necessarily limited to unpaid salaries, bonuses and/or
suppliers. Notwithstanding anything to the contrary stated above, the debts
owed to the Company's accountants and attorneys which may be over and above
the amounts stated in paragraph 4 above, are not required to be converted
and may continue to accrue in order to be paid at the Merger Closing and/or
according to terms agreed to among the parties.
All other terms and conditions of the Amended Agreement will remain the same.
In Witness Whereof, the parties hereto execute this Amendment as of the day and
date set out above.
Xxxxxxx Xxxxxx & Company Polar Molecular Corporation
Financial Services, Inc.
By: /s/ Xxxxxx X. Brendegen By: /s/ Xxxx X. Xxxxxx
---------------------------- --------------------------------
Title: CFO Title: President-CEO
3
AMENDMENT J
This Amendment J (the "Amendment J") dated as of September 30, 2002, is attached
to and made a part of that Placement Agreement dated as of December 21, 2001
(the "Placement Agreement") which was amended pursuant to an Amendment A dated
as of December 31, 2001, (the "Amendment A"), which was amended pursuant to an
Amendment B dated as of February 28, 2002 ("Amendment B"), which was amended
pursuant to an Amendment C dated as of March 27, 2002 ("Amendment C"), which was
amended pursuant to an Amendment D dated as of April 30, 2002 ("Amendment D"),
which was amended pursuant to an Amendment E dated as of May 15, 2002
("Amendment E"), which was amended pursuant to an Amendment F dated as of June
13, 2002 ("Amendment F"), which was amended pursuant to an Amendment G dated as
of July 12, 2002 ("Amendment G"), which was amended pursuant to an Amendment H
dated as of August 30, 2002 ("Amendment H"), which was amended pursuant to an
Amendment I dated as of September 30, 2002 ("Amendment I"), all of which were
executed by and between Xxxxxxx Xxxxxx & Company Financial Services, Inc.
(Placement Agent) and Polar Molecular Corporation (the "Company") (collectively
the Placement Agreement, the Amendment A, the Amendment B, the Amendment C, the
Amendment D, the Amendment E, the Amendment F, the Amendment G, the Amendment H
and the Amendment I shall be referred to as the "Amended Agreement").
All terms defined in the Amended Agreement will have the same meaning when used
in this Amendment.
Whereas, the parties desire to amend the terms of the Amended Agreement.
Now Therefore, in consideration of the foregoing, and for other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
agree as follows:
1. The proceeds of the Additional Offering shall be distributed as follows:
(a) Of the first $143,000 raised in the Additional Offering, the proceeds,
net of a 10% commission to the Placement Agent, shall go 100% to the
Company.
(b) Of the next $157,000 raised in the Additional Offering, the proceeds,
net of a 10% commission to the Placement Agent, shall go 50% to Xxxxxxx and
50% to the Company.
(c) Of the next $400,000 raised in the Additional Offering, the proceeds,
net of an 18.75% commission to the Placement Agent (to be shared by the
Placement Agent with
Houhlihan Xxxxx & Company Inc. to give effect to the Amended Agreement),
shall go 66.67% to the Company and 33.33% to Xxxxxxx.
2. The Company agrees that out of the proceeds raised from the exercise of
Warrants resulting from the Interim Offering and/or the Additional Offering, the
Company will loan to Xxxxxxx the sum of (i) $57,696, (ii) one third of the
proceeds (net of any commissions) raised in the Additional Offering less any
amounts loaned to Xxxxxxx under the provisions of paragraph 1 of this Amendment
J and (iii) one-third of the proceeds (net of any commissions) raised from such
Warrants.
3. The Company agrees that, to the extent that Xxxxxxx (x) chooses not to accept
any portion of the amounts to be loaned from the Company under the terms set
forth in paragraph 2 above or (y) otherwise does not (whether or not any
proceeds are raised from the exercise of such Warrants) receive the amounts set
forth it items (i) and (ii) of paragraph 2, Xxxxxxx shall receive a credit
against its liabilities for purposes of meeting the Net Worth Test (as defined
in the Merger Agreement).
4. The parties agree that they shall not amend the provisions of paragraphs 1
through 4 of this Amendment J without the consent of Xxxxxxx, which is hereby
named as a third party beneficiary of such paragraphs 1 through 4.
5. Paragraph 6.e. of the Amended Agreement shall be amended by deleting the
reference to "November 27, 2002" at the end of the paragraph and replacing it
with "December 20, 2002". The Termination Date shall be December 20, 2002.
6. The parties agree that the Company, in cooperation with Xxxxxxx, will have
filed the Registration Statement on Form S-4 regarding the merger of the Company
and Xxxxxxx (the "S-4 Filing") on or prior to December 23, 2002.
7. Placement Agent agrees that the Company and the Placement Agent have received
a letter from TFE that meets the requirements set forth in Amendment I.
8. Notwithstanding the compensation expense amounts referenced in paragraph 2 of
Amendment B, which the parties agree is superseded by this paragraph 8 of this
Amendment J, the Company agrees that it will limit its compensation expense (as
shown in its initial S-4 Filing, assuming no prior comments by the Securities
and Exchange Commission) relating to issuance of common stock and/or options to
officers and directors since November 1, 2001 to an amount not exceeding
$1,000,000. The parties agree that no such cap is applicable to any related
changes in the S-4 Filing or otherwise required to comply with
2
comments of the Securities and Exchange Commission or other related agency.
All other terms and conditions of the Amendment Agreement will remain the same.
In Witness Whereof, the parties hereto execute this Amendment as of the day and
date set out above.
Xxxxxxx Xxxxxx & Company Polar Molecular Corporation
Financial Services, Inc.
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxxx
---------------------------- -------------------------------
Title: CEO Title: President - CEO
Acknowledged and agreed for the
purposes of paragraphs 1 through 4
hereof:
XXXXXXX COMMUNICATIONS CORPORATION
By: /s/
----------------------------
Title:
-------------------------
3
AMENDMENT K
This Amendment K ("Amendment K") dated as of December 20, 2002, is attached to
and made a part of that Placement Agreement dated as of December 21, 2001 (the
"Placement Agreement") which was amended pursuant to an Amendment A dated as of
December 21, 2001 (the "Amendment A"), which was amended pursuant to an
Amendment B dated as of February 28, 2002 ("Amendment B"), which was amended
pursuant to an Amendment C dated as of March 27, 2002 ("Amendment C"), which was
amended pursuant to an Amendment D dated as of April 30, 2002 ("Amendment D"),
which was amended pursuant to an Amendment E dated as of May 15, 2002
("Amendment E"), which was amended pursuant to an Amendment F dated as of June
13, 2002 ("Amendment F"), which was amended pursuant to an Amendment G dated as
of July 12, 2002 ("Amendment G"), which was amended pursuant to an Amendment H
dated as of August 30, 2002 ("Amendment H"), which was amended pursuant to an
Amendment I dated as of September 30, 2002 ("Amendment I"), which was amended
pursuant to an Amendment J which was incorrectly dated as of September 30, 2002
and which should have been dated as of December 11, 2002, all of which were
executed by and between Xxxxxxx Xxxxxx & Company Financial Services, Inc.
(Placement Agent) and Polar Molecular Corporation (the "Company") (collectively
the Placement Agreement, the Amendment A, the Amendment B, the Amendment C, the
Amendment D, the Amendment E, the Amendment F, the Amendment G, the Amendment H,
the Amendment I and the Amendment J shall be referred to as the "Amended
Agreement").
All terms defined in the Amended Agreement will have the same meaning when used
in this Amendment.
Whereas, the parties desire to amend the terms of the Amended Agreement.
Now Therefore, in consideration of the foregoing, and for other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
agree as follows:
1. Pursuant to the terms of the Amended Agreement, the parties agree that the
Additional Offering shall be extended for an additional 42 days until
January 31, 2003, or until the Xxxxxxx Communication Corporation
Registration Statement (the "S-4 Filing") is completed and filed with the
SEC, whichever is later, and the Additional Offering Termination Date shall
include such later applicable date.
2. Paragraph 6.e. of the Amended Agreement shall be amended by deleting the
reference to "December 20, 2002" at the end of the paragraph and replacing
it with "January 31, 2003 or the date when the S-4 Filing is completed and
filed with the SEC, whichever is later." The Termination Date shall be
January 31, 2003 or the date when the S-4 Filing is completed and filed
with the SEC, whichever is later.
3. The parties agree that the Company, in cooperation with Xxxxxxx, will have
filed the Registration Statement on Form S-4 regarding the merger of the
Company and Xxxxxxx (the "S-4 Filing") as soon as practicable.
All other terms and conditions of the Amended Agreement will remain the
same.
In Witness Whereof, the parties hereto execute this Amendment as of the day
and date set out above.
Xxxxxxx Xxxxxx & Company Polar Molecular Corporation
Financial Services, Inc.
By: By: /s/ Xxxx X. Xxxxxx
---------------------------- --------------------------------
Title: Title: President - CEO
-------------------------
