Exhibit 10.3
ENCLAVES GROUP, INC.
AMENDED AND RESTATED PLACEMENT AGENT AGREEMENT
Dated as of: November __, 2005
Newbridge Securities Corporation
0000 Xxxxxxx Xxxxx Xxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Ladies and Gentlemen:
The undersigned, Enclaves Group, Inc. (f/k/a Alliance Towers, Inc.), a
Delaware corporation (the "Company"), hereby agrees with Newbridge Securities
Corporation (the "PLACEMENT AGENT"), and Cornell Capital Partners, LP (the
"Investor") as follows:
1. OFFERING. On or about December 28, 2004, Enclaves Group, Inc.
("ENCLAVES"), a Delaware corporation, entered into that certain Standby Equity
Distribution Agreement and other related documents, instruments and agreements,
including without limitation the Placement Agent Agreement (the "ENCLAVES
PLACEMENT AGREEMENT") with the Investor and the Placement Agent. Enclaves was
subsequently acquired by the Company (f/k/a Alliance Towers, Inc., a Florida
corporation) on April 27, 2005 (the "ACQUISITION"). The Company assumed
obligations of Enclaves to the Investor under the Standby Equity Distribution
Agreement dated December 28, 2004 pursuant to that certain Assignment and
Assumption Agreement dated July 1, 2005 (the "ASSUMPTION AGREEMENT") by and
among the Company, Enclaves and the Investor. This Agreement shall amend and
restate the Placement Agent Agreement dated December 28, 2004. The Company
hereby engages the Placement Agent to act as its exclusive placement agent in
connection with the Amended and Restated Standby Equity Distribution Agreement
dated the date hereof between the Company and the Investor (the "STANDBY EQUITY
DISTRIBUTION AGREEMENT"), pursuant to which the Company shall issue and sell to
the Investor, from time to time, and the Investor shall purchase from the
Company (the "OFFERING") up to Forty Six Million Dollars ($46,000,000) (the
"COMMITMENT AMOUNT") of the Company's common stock, par value $0.001 per share
(the "COMMON STOCK"), at price per share equal to the Purchase Price, as that
term is defined in the Standby Equity Distribution Agreement. The Placement
Agent services shall consist of reviewing the terms of the Standby Equity
Distribution Agreement and advising the Company with respect to those terms.
This Amended and Restated Placement Agent Agreement shall amend and
restate the Enclaves Placement Agreement. All capitalized terms used herein and
not otherwise defined herein shall have the same meaning ascribed to them as in
the Standby Equity Distribution Agreement. The Investor will be granted certain
registration rights with respect to the Common Stock as more fully set forth in
the Registration Rights Agreement between the Company and the Investor dated the
date hereof (the "REGISTRATION RIGHTS AGREEMENT"). The documents to be executed
and delivered in connection with the Offering, including, but not limited, to
the Company's latest Quarterly Report on Form 10-QSB as filed with the United
States Securities and Exchange Commission, this Agreement, the Standby Equity
Distribution Agreement, and the Registration Rights Agreement are referred to
sometimes hereinafter collectively as the "OFFERING MATERIALS." The Company's
Common Stock purchased by the Investor under the Standby Equity Distribution
Agreement is sometimes referred to hereinafter as the "Securities." The
Placement Agent shall not be obligated to sell any Securities.
2. COMPENSATION.
A. Upon the execution of this Agreement, the Company
shall issue to the Placement Agent or its designee shares of the Company's
Common Stock in an amount equal to Ten Thousand Dollars ($10,000) divided by the
volume weighted average price of the Common Stock, as quoted by Bloomberg, LP,
on the date hereof (the "PLACEMENT AGENT'S SHARES"). The Placement Agent shall
be entitled to "piggy-back" registration rights with respect to the Placement
Agent's Shares, which shall be triggered upon registration of any shares of
Common Stock by the Company pursuant to the Registration Rights Agreement dated
the date hereof.
3. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PLACEMENT AGENT.
A. The Placement Agent represents, warrants and
covenants as follows:
(i) The Placement Agent has the necessary power
to enter into this Agreement and to consummate the transactions contemplated
hereby.
(ii) The execution and delivery by the Placement
Agent of this Agreement and the consummation of the transactions contemplated
herein will not result in any violation of, or be in conflict with, or
constitute a default under, any agreement or instrument to which the Placement
Agent is a party or by which the Placement Agent or its properties are bound, or
any judgment, decree, order or, to the Placement Agent's knowledge, any statute,
rule or regulation applicable to the Placement Agent. This Agreement when
executed and delivered by the Placement Agent, will constitute the legal, valid
and binding obligations of the Placement Agent, enforceable in accordance with
their respective terms, except to the extent that (a) the enforceability hereof
or thereof may be limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws from time to time in effect and affecting the rights of
creditors generally, (b) the enforceability hereof or thereof is subject to
general principles of equity, or (c) the indemnification provisions hereof or
thereof may be held to be in violation of public policy.
(iii) Upon receipt and execution of this
Agreement, the Placement Agent will promptly forward copies of this Agreement to
the Company or its counsel and the Investor or its counsel.
(iv) The Placement Agent will not intentionally
take any action that it reasonably believes would cause the Offering to violate
the provisions of the Securities Act of 1933, as amended (the "1933 ACT"), the
Securities Exchange Act of 1934 (the "1934 ACT"), the respective rules and
regulations promulgated thereunder (the "RULES AND REGULATIONS") or applicable
"Blue Sky" laws of any state or jurisdiction.
2
(v) The Placement Agent is a member of the
National Association of Securities Dealers, Inc., and is a broker-dealer
registered as such under the 1934 Act and under the securities laws of the
states in which the Securities will be offered or sold by the Placement Agent
unless an exemption for such state registration is available to the Placement
Agent. The Placement Agent is in material compliance with the rules and
regulations applicable to the Placement Agent generally and applicable to the
Placement Agent's participation in the Offering.
4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
A. The Company represents and warrants as follows:
(i) The execution, delivery and performance of
each of this Agreement, the Standby Equity Distribution Agreement, and the
Registration Rights Agreement has been or will be duly and validly authorized by
the Company and is, or with respect to this Agreement, the Standby Equity
Distribution Agreement, and the Registration Rights Agreement will be, a valid
and binding agreement of the Company, enforceable in accordance with its
respective terms, except to the extent that (a) the enforceability hereof or
thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws from time to time in effect and affecting the rights of creditors
generally, (b) the enforceability hereof or thereof is subject to general
principles of equity or (c) the indemnification provisions hereof or thereof may
be held to be in violation of public policy. The Securities to be issued
pursuant to the transactions contemplated by this Agreement and the Standby
Equity Distribution Agreement have been duly authorized and, when issued and
paid for in accordance with this Agreement and the Standby Equity Distribution
Agreement will be valid and binding obligations of the Company, enforceable in
accordance with their respective terms, except to the extent that (1) the
enforceability thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws from time to time in effect and affecting the rights
of creditors generally, and (2) the enforceability thereof is subject to general
principles of equity. All corporate action required to be taken for the
authorization, issuance and sale of the Securities has been duly and validly
taken by the Company.
(ii) The Company has a duly authorized, issued
and outstanding capitalization as set forth herein and in the Standby Equity
Distribution Agreement. The Company is not a party to or bound by any
instrument, agreement or other arrangement providing for it to issue any capital
stock, rights, warrants, options or other securities, except for this Agreement,
the agreements described herein and as described in the Standby Equity
Distribution Agreement and the agreements described therein. All issued and
outstanding securities of the Company, have been duly authorized and validly
issued and are fully paid and non-assessable; the holders thereof have no rights
of rescission or preemptive rights with respect thereto and are not subject to
personal liability solely by reason of being security holders; and none of such
securities were issued in violation of the preemptive rights of any holders of
any security of the Company.
(iii) The Common Stock to be issued in accordance
with this Agreement and the Standby Equity Distribution Agreement have been duly
authorized and, when issued and paid for in accordance with this Agreement, the
Standby Equity Distribution Agreement and the certificates/instruments
3
representing such Common Stock will be validly issued, fully-paid and
non-assessable; the holders thereof will not be subject to personal liability
solely by reason of being such holders; such Securities are not and will not be
subject to the preemptive rights of any holder of any security of the Company.
(iv) The Company has good and marketable title
to, or valid and enforceable leasehold estates in, all items of real and
personal property necessary to conduct its business (including, without
limitation, any real or personal property stated in the Offering Materials to be
owned or leased by the Company), free and clear of all liens, encumbrances,
claims, security interests and defects of any material nature whatsoever, other
than those set forth in the Offering Materials and liens for taxes not yet due
and payable.
(v) There is no litigation or governmental
proceeding pending or, to the best of the Company's knowledge, threatened
against, or involving the properties or business of the Company, except as set
forth in the Offering Materials.
(vi) The Company is duly organized and validly
exists as a corporation in good standing under the laws of the State of
Delaware. Except as set forth in the Offering Materials, the Company does not
own or control, directly or indirectly, an interest in any other corporation,
partnership, trust, joint venture or other business entity. The Company is duly
qualified or licensed and in good standing as a foreign corporation in each
jurisdiction in which the character of its operations requires such
qualification or licensing and where failure to so qualify would have a material
adverse effect on the Company. The Company has all requisite corporate power and
authority, and all material and necessary authorizations, approvals, orders,
licenses, certificates and permits of and from all governmental regulatory
officials and bodies (domestic and foreign) to conduct its businesses (and
proposed business) as described in the Offering Materials. Any disclosures in
the Offering Materials concerning the effects of foreign, federal, state and
local regulation on the Company's businesses as currently conducted and as
contemplated are correct in all material respects and do not omit to state a
material fact. The Company has all corporate power and authority to enter into
this Agreement, the Standby Equity Distribution Agreement, the Registration
Rights Agreement, and to carry out the provisions and conditions hereof and
thereof, and all consents, authorizations, approvals and orders required in
connection herewith and therewith have been obtained. No consent, authorization
or order of, and no filing with, any court, government agency or other body is
required by the Company for the issuance of the Securities or execution and
delivery of the Offering Materials except for applicable federal and state
securities laws. The Company, since its inception, has not incurred any
liability arising under or as a result of the application of any of the
provisions of the 1933 Act, the 1934 Act or the Rules and Regulations.
(vii) There has been no material adverse change in
the condition or prospects of the Company, financial or otherwise, from the
latest dates as of which such condition or prospects, respectively, are set
forth in the Offering Materials, and the outstanding debt, the property and the
business of the Company conform in all material respects to the descriptions
thereof contained in the Offering Materials.
(viii) Except as set forth in the Offering
Materials, the Company is not in breach of, or in default under, any term or
provision of any material indenture, mortgage, deed of trust, lease, note, loan
4
or any other material agreement or instrument evidencing an obligation for
borrowed money, or any other material agreement or instrument to which it is a
party or by which it or any of its properties may be bound or affected. The
Company is not in violation of any provision of its charter or by-laws or in
violation of any franchise, license, permit, judgment, decree or order, or in
violation of any material statute, rule or regulation. Neither the execution and
delivery of the Offering Materials nor the issuance and sale or delivery of the
Securities, nor the consummation of any of the transactions contemplated in the
Offering Materials nor the compliance by the Company with the terms and
provisions hereof or thereof, has conflicted with or will conflict with, or has
resulted in or will result in a breach of, any of the terms and provisions of,
or has constituted or will constitute a default under, or has resulted in or
will result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or pursuant to the terms of any
indenture, mortgage, deed of trust, note, loan or any other agreement or
instrument evidencing an obligation for borrowed money, or any other agreement
or instrument to which the Company may be bound or to which any of the property
or assets of the Company is subject except (a) where such default, lien, charge
or encumbrance would not have a material adverse effect on the Company and (b)
as described in the Offering Materials; nor will such action result in any
violation of the provisions of the charter or the by-laws of the Company or,
assuming the due performance by the Placement Agent of its obligations
hereunder, any material statute or any material order, rule or regulation
applicable to the Company of any court or of any foreign, federal, state or
other regulatory authority or other government body having jurisdiction over the
Company.
(ix) Subsequent to the dates as of which
information is given in the Offering Materials, and except as may otherwise be
indicated or contemplated herein or therein the Company has not (a) issued any
securities or incurred any liability or obligation, direct or contingent, for
borrowed money, or (b) entered into any transaction other than in the ordinary
course of business, or (c) declared or paid any dividend or made any other
distribution on or in respect of its capital stock. Except as described in the
Offering Materials, the Company has no outstanding obligations to any officer or
director of the Company other than normal payable in connection with services
provided recently.
(x) There are no claims for services in the
nature of a finder's or origination fee with respect to the sale of the Common
Stock or any other arrangements, agreements or understandings that may affect
the Placement Agent's compensation, as determined by the National Association of
Securities Dealers, Inc.
(xi) The Company owns or possesses, free and
clear of all liens or encumbrances and rights thereto or therein by third
parties, the requisite licenses or other rights to use all trademarks, service
marks, copyrights, service names, trade names, patents, patent applications and
licenses necessary to conduct its business (including, without limitation, any
such licenses or rights described in the Offering Materials as being owned or
possessed by the Company) and, except as set forth in the Offering Materials,
there is no claim or action by any person pertaining to, or proceeding, pending
or threatened, which challenges the exclusive rights of the Company with respect
to any trademarks, service marks, copyrights, service names, trade names,
patents, patent applications and licenses used in the conduct of the Company's
businesses (including, without limitation, any such licenses or rights described
in the Offering Materials as being owned or possessed by the Company) except any
claim or action that would not have a material adverse effect on the Company;
5
the Company's current products, services or processes do not infringe or will
not infringe on the patents currently held by any third party.
(xii) Subject to the performance by the Placement
Agent of its obligations hereunder the offer and sale of the Securities
complies, and will continue to comply, in all material respects with the
requirements of Rule 506 of Regulation D promulgated by the SEC pursuant to the
1933 Act and any other applicable federal and state laws, rules, regulations and
executive orders. Neither the Offering Materials nor any amendment or supplement
thereto nor any documents prepared by the Company in connection with the
Offering will contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. All statements of material facts in the Offering Materials are
true and correct as of the date of the Offering Materials.
(xiii) All material taxes which are due and payable
from the Company have been paid in full or adequate provision has been made for
such taxes on the books of the Company, except for those taxes disputed in good
faith by the Company
(xiv) None of the Company nor any of its officers,
directors, employees or agents, nor any other person acting on behalf of the
Company, has, directly or indirectly, given or agreed to give any money, gift or
similar benefit (other than legal price concessions to customers in the ordinary
course of business) to any customer, supplier, employee or agent of a customer
or supplier, or official or employee of any governmental agency or
instrumentality of any government (domestic or foreign) or any political party
or candidate for office (domestic or foreign) or other person who is or may be
in a position to help or hinder the business of the Company (or assist it in
connection with any actual or proposed transaction) which (A) might subject the
Company to any damage or penalty in any civil, criminal or governmental
litigation or proceeding, or (B) if not given in the past, might have had a
materially adverse effect on the assets, business or operations of the Company
as reflected in any of the financial statements contained in the Offering
Materials, or (C) if not continued in the future, might adversely affect the
assets, business, operations or prospects of the Company in the future.
5. CERTAIN COVENANTS AND AGREEMENTS OF THE COMPANY.
The Company covenants and agrees at its expense and without any expense
to the Placement Agent as follows:
A. To advise the Placement Agent of any material adverse
change in the Company's financial condition, prospects or business or of any
development materially affecting the Company or rendering untrue or misleading
any material statement in the Offering Materials occurring at any time as soon
as the Company is either informed or becomes aware thereof.
B. To use its commercially reasonable efforts to cause
the Common Stock issuable in connection with the Standby Equity Distribution
Agreement to be qualified or registered for sale on terms consistent with those
stated in the Registration Rights Agreement and under the securities laws of
such jurisdictions as the Placement Agent shall reasonably request.
6
Qualification, registration and exemption charges and fees shall be at the sole
cost and expense of the Company.
C. Upon written request, to provide and continue to
provide the Placement Agent copies of all quarterly financial statements and
audited annual financial statements prepared by or on behalf of the Company,
other reports prepared by or on behalf of the Company for public disclosure and
all documents delivered to the Company's stockholders.
D. To comply with the terms of the Offering Materials.
E. To ensure that any transactions between or among the
Company, or any of its officers, directors and affiliates be on terms and
conditions that are no less favorable to the Company, than the terms and
conditions that would be available in an "arm's length" transaction with an
independent third party.
F. Upon the effectiveness of a registration statement
covering the Securities, the Company shall promptly provide the Placement Agent
shall an opinion of Counsel to the Company, which opinion shall be in form and
substance reasonably satisfactory to and the Placement Agent.
G. At or prior to the Closing, the Company shall have
been furnished such documents, certificates and opinions as it may reasonably
require for the purpose of enabling the Placement Agent to review or pass upon
the matters referred to in this Agreement and the Offering Materials, or in
order to evidence the accuracy, completeness or satisfaction of any of the
representations, warranties or conditions herein contained.
6. INDEMNIFICATION AND LIMITATION OF LIABILITY.
A. The Company hereby agrees that it will indemnify and
hold the Placement Agent and each officer, director, shareholder, employee or
representative of the Placement Agent and each person controlling, controlled by
or under common control with the Placement Agent within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act or the SEC's Rules and
Regulations promulgated thereunder (the "RULES AND REGULATIONS"), harmless from
and against any and all loss, claim, damage, liability, cost or expense
whatsoever (including, but not limited to, any and all reasonable legal fees and
other expenses and disbursements incurred in connection with investigating,
preparing to defend or defending any action, suit or proceeding, including any
inquiry or investigation, commenced or threatened, or any claim whatsoever or in
appearing or preparing for appearance as a witness in any action, suit or
proceeding, including any inquiry, investigation or pretrial proceeding such as
a deposition) to which the Placement Agent or such indemnified person of the
Placement Agent may become subject under the 1933 Act, the 1934 Act, the Rules
and Regulations, or any other federal or state law or regulation, common law or
otherwise, arising out of or based upon (i) any untrue statement or alleged
untrue statement of a material fact contained in (a) Section 4 of this
Agreement, (b) the Offering Materials (except those written statements relating
to the Placement Agent given by the Placement Agent for inclusion therein), (c)
any application or other document or written communication executed by the
Company or based upon written information furnished by the Company filed in any
7
jurisdiction in order to qualify the Common Stock under the securities laws
thereof, or any state securities commission or agency; (ii) the omission or
alleged omission from documents described in clauses (a), (b) or (c) above of a
material fact required to be stated therein or necessary to make the statements
therein not misleading; or (iii) the breach of any representation, warranty,
covenant or agreement made by the Company in this Agreement. The Company further
agrees that upon demand by an indemnified person, at any time or from time to
time, it will promptly reimburse such indemnified person for any loss, claim,
damage, liability, cost or expense actually and reasonably paid by the
indemnified person as to which the Company has indemnified such person pursuant
hereto. Notwithstanding the foregoing provisions of this Paragraph 7(A), any
such payment or reimbursement by the Company of fees, expenses or disbursements
incurred by an indemnified person in any proceeding in which a final judgment by
a court of competent jurisdiction (after all appeals or the expiration of time
to appeal) is entered against the Placement Agent or such indemnified person
based upon specific finding of fact that the Placement Agent or such indemnified
person's gross negligence or willful misfeasance will be promptly repaid to the
Company.
B. The Placement Agent hereby agrees that it will
indemnify and hold the Company and each officer, director, shareholder, employee
or representative of the Company, and each person controlling, controlled by or
under common control with the Company within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act or the Rules and Regulations, harmless
from and against any and all loss, claim, damage, liability, cost or expense
whatsoever (including, but not limited to, any and all reasonable legal fees and
other expenses and disbursements incurred in connection with investigating,
preparing to defend or defending any action, suit or proceeding, including any
inquiry or investigation, commenced or threatened, or any claim whatsoever or in
appearing or preparing for appearance as a witness in any action, suit or
proceeding, including any inquiry, investigation or pretrial proceeding such as
a deposition) to which the Company or such indemnified person of the Company may
become subject under the 1933 Act, the 1934 Act, the Rules and Regulations, or
any other federal or state law or regulation, common law or otherwise, arising
out of or based upon (i) the material breach of any representation, warranty,
covenant or agreement made by the Placement Agent in this Agreement, or (ii) any
false or misleading information provided to the Company in writing by one of the
Placement Agent's indemnified persons specifically for inclusion in the Offering
Materials.
C. Promptly after receipt by an indemnified party of
notice of commencement of any action covered by Section 7(A) or (B), the party
to be indemnified shall, within five (5) business days, notify the indemnifying
party of the commencement thereof; the omission by one (1) indemnified party to
so notify the indemnifying party shall not relieve the indemnifying party of its
obligation to indemnify any other indemnified party that has given such notice
and shall not relieve the indemnifying party of any liability outside of this
indemnification if not materially prejudiced thereby. In the event that any
action is brought against the indemnified party, the indemnifying party will be
entitled to participate therein and, to the extent it may desire, to assume and
control the defense thereof with counsel chosen by it which is reasonably
acceptable to the indemnified party. After notice from the indemnifying party to
such indemnified party of its election to so assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under such
Section 7(A) or (B), for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof, but the
8
indemnified party may, at its own expense, participate in such defense by
counsel chosen by it, without, however, impairing the indemnifying party's
control of the defense. Subject to the proviso of this sentence and
notwithstanding any other statement to the contrary contained herein, the
indemnified party or parties shall have the right to choose its or their own
counsel and control the defense of any action, all at the expense of the
indemnifying party if (i) the employment of such counsel shall have been
authorized in writing by the indemnifying party in connection with the defense
of such action at the expense of the indemnifying party, or (ii) the
indemnifying party shall not have employed counsel reasonably satisfactory to
such indemnified party to have charge of the defense of such action within a
reasonable time after notice of commencement of the action, or (iii) such
indemnified party or parties shall have reasonably concluded that there may be
defenses available to it or them which are different from or additional to those
available to one or all of the indemnifying parties (in which case the
indemnifying parties shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
such fees and expenses of one additional counsel shall be borne by the
indemnifying party; provided, however, that the indemnifying party shall not, in
connection with any one action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstance, be liable for the reasonable fees and expenses of more than one
separate firm of attorneys at any time for all such indemnified parties. No
settlement of any action or proceeding against an indemnified party shall be
made without the consent of the indemnifying party.
D. In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for in
Section 7(A) or 7(B) is due in accordance with its terms but is for any reason
held by a court to be unavailable on grounds of policy or otherwise, the Company
and the Placement Agent shall contribute to the aggregate losses, claims,
damages and liabilities (including legal or other expenses reasonably incurred
in connection with the investigation or defense of same) which the other may
incur in such proportion so that the Placement Agent shall be responsible for
such percent of the aggregate of such losses, claims, damages and liabilities as
shall equal the percentage of the gross proceeds paid to the Placement Agent and
the Company shall be responsible for the balance; provided, however, that no
person guilty of fraudulent misrepresentation within the meaning of Section
11(f) of the 1933 Act shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. For purposes of this Section
7(D), any person controlling, controlled by or under common control with the
Placement Agent, or any partner, director, officer, employee, representative or
any agent of any thereof, shall have the same rights to contribution as the
Placement Agent and each person controlling, controlled by or under common
control with the Company within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act and each officer of the Company and each director of
the Company shall have the same rights to contribution as the Company. Any party
entitled to contribution will, promptly after receipt of notice of commencement
of any action, suit or proceeding against such party in respect of which a claim
for contribution may be made against the other party under this Section 7(D),
notify such party from whom contribution may be sought, but the omission to so
notify such party shall not relieve the party from whom contribution may be
sought from any obligation they may have hereunder or otherwise if the party
from whom contribution may be sought is not materially prejudiced thereby.
9
E. The indemnity and contribution agreements contained
in this Section 7 shall remain operative and in full force and effect regardless
of any investigation made by or on behalf of any indemnified person or any
termination of this Agreement.
F. The Company hereby waives, to the fullest extent
permitted by law, any right to or claim of any punitive, exemplary, incidental,
indirect, special, consequential or other damages (including, without
limitation, loss of profits) against the Placement Agent and each officer,
director, shareholder, employee or representative of the placement agent and
each person controlling, controlled by or under common control with the
Placement Agent within the meaning of Section 15 of the 1933 Act or Section 20
of the 1934 Act or the Rules and Regulations arising out of any cause whatsoever
(whether such cause be based in contract, negligence, strict liability, other
tort or otherwise). Notwithstanding anything to the contrary contained herein,
the aggregate liability of the Placement Agent and each officer, director,
shareholder, employee or representative of the Placement Agent and each person
controlling, controlled by or under common control with the Placement Agent
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
or the Rules and Regulations shall not exceed the compensation received by the
Placement Agent pursuant to Section 2 hereof. This limitation of liability shall
apply regardless of the cause of action, whether contract, tort (including,
without limitation, negligence) or breach of statute or any other legal or
equitable obligation.
7. PAYMENT OF EXPENSES.
The Company hereby agrees to bear all of the expenses in connection
with the Offering, including, but not limited to the following: filing fees,
printing and duplicating costs, advertisements, postage and mailing expenses
with respect to the transmission of Offering Materials, registrar and transfer
agent fees and the fees of the Company's counsel and accountants, issue and
transfer taxes, if any.
8. TERMINATION.
This Agreement shall be co-terminus with, and terminate upon the same
terms and conditions as those set forth in the Standby Equity Distribution
Agreement.
9. MISCELLANEOUS.
A. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all which
shall be deemed to be one and the same instrument.
B. Any notice required or permitted to be given
hereunder shall be given in writing and shall be deemed effective when deposited
in the United States mail, postage prepaid, or when received if personally
delivered or faxed (upon confirmation of receipt received by the sending party),
addressed as follows to such other address of which written notice is given to
the others):
10
If to Placement Agent, to: Newbridge Securities Corporation
0000 Xxxxxxx Xxxxx Xxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Company, to: Enclaves Group, Inc.
00 Xxxxxxxxx Xxxx, Xxxxx Xxxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to: Xxxxxx Xxxxxxxx Frome Xxxxxxxxxx & Xxxxxxx LLP
Park Avenue Tower
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
C. This Agreement shall be governed by and construed in
all respects under the laws of the State of New Jersey, without reference to its
conflict of laws rules or principles. Any suit, action, proceeding or litigation
arising out of or relating to this Agreement shall be brought and prosecuted in
such federal or state court or courts located within the State of Florida as
provided by law. The parties hereby irrevocably and unconditionally consent to
the jurisdiction of each such court or courts located within the State of
Florida and to service of process by registered or certified mail, return
receipt requested, or by any other manner provided by applicable law, and hereby
irrevocably and unconditionally waive any right to claim that any suit, action,
proceeding or litigation so commenced has been commenced in an inconvenient
forum.
D. This Agreement and the other agreements referenced
herein contain the entire understanding between the parties hereto and may not
be modified or amended except by a writing duly signed by the party against whom
enforcement of the modification or amendment is sought.
E. If any provision of this Agreement shall be held to
be invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision of this Agreement.
[REMAINDER OF PAGE INTENTIALLY LEFT BLANK]
11
IN WITNESS WHEREOF, the parties hereto have executed this Placement
Agent Agreement as of the date first written above.
ENCLAVES GROUP, INC.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxx
Title: President & CEO
NEWBRIDGE SECURITIES CORPORATION
By: /s/ Xxx X. Xxxxx
-------------------------------------
Name: Xxx X. Xxxxx
Title: President
CORNELL CAPITAL PARTNERS, LP
BY: YORKVILLE ADVISORS, LLC
ITS: GENERAL PARTNER
By: /s/ Xxxx X. Xxxxxx
-------------------------------------
Name: Xxxx X. Xxxxxx
Title: Portfolio Manager
