EXHIBIT 1.1
October 3, 2002
VIA FACSIMILE (000) 000-0000
Xx. Xxxxxxx Xxxxx
I-Bankers Securities Incorporated
000 X. Xxxxxxxxx Xxxx.
Xxxxx 000
Xxxxxx, XX 00000
RE: XXXXXXX.XXX, INC.
Dear Xxxxxxx:
The purpose of this letter agreement is to memorialize the compensation
that I-Bankers Securities Incorporated ("I-Bankers") will receive in
consideration of undertaking the role of Qualified Independent Underwriter, as
such term is defined in Rule 2720 of the NASD Conduct Rules, for the
registration of 892,000 shares of common stock of Xxxxxxx.xxx, Inc. ("Corpfin").
I-Bankers will be responsible for conducting proper due diligence relating to
such an offering and undertaking the legal responsibilities and liabilities of
an underwriter under the Securities Act of 1933, as amended. Corpfin agrees to
pay I-Bankers for such services the amount of Twenty-Five Thousand Dollars
($25,000) plus a five-year warrant (the "Warrant") to purchase up to 2.5% of the
amount of shares being registered by Corpfin exercisable at a value equal to
120% of the offering price. The warrant shall be exercisable during the
four-year period beginning one year from the date of this prospectus and shall
not be redeemable. I-Bankers agrees that the warrant, and the securities
underlying the warrant, may not be sold, transferred, assigned or hypothecated
for one year following the date of issuance, except to an individual who is an
officer or partner of I-Bankers, by will or by the laws of descent and
distribution.
An initial payment of $10,000 to I-Bankers will be made on the date of
execution of this Letter Agreement by wire-transfer according to instructions
provided by I-Bankers. The remaining $15,000 and the warrant shall be delivered
at the time the SEC declares Corpfin's registration statement effective. We
understand that, in the event the NASD disapproves I-Bankers to act as a QIU
pursuant to NASD Rule 2720 in this distribution, any payments made shall be
refundable in full minus any expenses incurred by I-Bankers in connection with
Corpfin's offering.
Corpfin agrees to indemnify and hold harmless I-Bankers, to the fullest
extent permitted by law, from and against any and all losses, claims, damages,
obligations, penalties, judgments, awards, liabilities, costs, expenses, and
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disbursements (and any and all actions, suits, proceedings, and investigations
in respect thereof and any and all legal and other costs, expenses, and
disbursements in giving testimony or furnishing documents in response to a
subpoena or otherwise), including, without limitation, the costs, expenses, and
disbursements, as and when incurred, of investigating, preparing, or litigation
in which I-Bankers is a party, directly or indirectly caused by, relating to,
based upon, arising out of, or in connection with (a) I-Bankers' acting for
Corpfin, including, without limitation, any act or omission by I-Bankers in
connection with its acceptance of or the performance or nonperformance of its
obligations under this letter agreement or (b) any untrue statement or alleged
untrue statement of a material fact contained in, or omissions or alleged
omissions from, the registration statement to be filed in connection with the
Offering or contained in this letter agreement; provided, however, such
indemnity agreement shall not apply to amounts paid in settlement of any such
litigation, if such settlements are made without the consent of Corpfin, nor to
any portion of any such loss, claim, damage, obligation, penalty, judgment,
award, liability, cost, expenses, or disbursement to the extent it is found in a
final judgment by a court of competent jurisdiction (not subject to further
appeal) to have resulted primarily and directly from the gross negligence or
willful misconduct of I-Bankers.
These indemnification provisions shall be in addition to any liability
which Corpfin may otherwise have to I-Bankers or the persons indemnified below
in this sentence and shall extend to the following: I-Bankers and its affiliated
entities, directors, officers, employees, legal counsel, Qualified Independent
Underwriters, consultants, independent contractors, strategic advisors, and
controlling persons (within the meaning of the securities laws of the United
States of America). All references to I-Bankers in these indemnification
provisions shall be understood to include any and all of the foregoing.
If any action, suit, proceeding, or investigation is commenced as to which
I-Bankers proposes to demand indemnification, then I-Bankers shall notify
Corpfin with reasonable promptness; provided, however, that any failure by
I-Bankers to notify Corpfin shall not relieve Corpfin from its obligations
hereunder unless such failure to notify Corpfin results in Corpfin's inability
to adequately defend such action, suit, proceeding or investigation. I-Bankers
shall have the right to retain counsel of its own choice to represent it, and
Corpfin shall pay the fees, expenses, and disbursements of such counsel; and
such counsel shall, to the extent consistent with its professional
responsibilities, cooperate with Corpfin and any counsel designated by Corpfin.
Corpfin shall not without the prior written consent of I-Bankers, settle or
compromise any claim, or permit a default or consent to the entry of any
judgment, in respect thereof, unless such settlement, compromise, or consent
includes, as an unconditional term thereof, the claimant's unconditional and
irrevocable release of I-Bankers from all liability in respect of such claim.
In order to provide for just and equitable contribution, if a claim for
indemnification pursuant to these indemnification provisions is made but it is
found in a final judgment by a court of competent jurisdiction (not subject to
further appeal) that such indemnification may not be enforced in such case, even
though the express provisions hereof provide for indemnification in such case,
then Corpfin, on the one hand, and I-Bankers, on the other hand, shall
contribute to the losses, claims, damages, obligations, penalties, judgments,
awards, liabilities, costs, expenses, and disbursements to which the indemnified
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persons may be subject in accordance with the relative fault of Corpfin on the
one hand, and I-Bankers on the other hand, in connection with the statements,
acts, or omissions which resulted in such losses, claims damages, obligations,
penalties, judgments, awards, liabilities, costs, expenses, or disbursements and
the relevant equitable considerations shall also be considered. No person found
liable for a fraudulent misrepresentation shall be entitled to contribution from
any person who is not also found liable for such fraudulent misrepresentation.
Notwithstanding the foregoing, I-Bankers shall not be obligated to contribute
any amount hereunder that exceeds the amount of fees previously received by
I-Bankers pursuant to this letter agreement.
Neither termination nor completion of this letter agreement or the Offering
shall affect these indemnification provisions, which shall continue to remain
operative and in full force and effect.
If the foregoing accurately reflects your understanding of the agreement
between Corpfin and I-Bankers, please acknowledge below where indicated.
Sincerely,
/s/ Xxxx X. Xxxxxxx
Xxxx X. Xxxxxxx
Xxxxxxx.xxx, Inc., CEO
ACKNOWLEDGED AND ACCEPTED:
I-BANKERS SECURITIES INCORPORATED
/s/ Xxxxxxx Xxxxx
------------------------
Xxxxxxx Xxxxx, Chief Financial Officer
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