1
10.11
XXXXX XXXXXXX SECURITIES, LLC
00 XXXXX XXXXXX
XXX XXXX, XX 00000
February , 0000
Xxxxx Xxxx, Inc.
0000 Xxxxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attention: Xxxxxxxx Xxxxxx, President
Gentlemen:
This letter, when executed by the parties hereto, will constitute an
agreement between Xxxxx Xxxx, Inc. (the "Company") and Xxxxx Xxxxxxx
Securities, LLC ("Xxxxx") pursuant to which the Company agrees to retain Xxxxx
and Xxxxx agrees to be retained by the Company under the terms and conditions
set forth below.
1. The Company hereby retains Xxxxx to perform consulting services
related to corporate finance and other financial services matters, and Xxxxx
hereby accepts such retention. In this regard, subject to the terms set forth
below, Xxxxx shall furnish to the Company advice and recommendations with
respect to such aspects of the business and affairs of the Company as the
Company shall, from time to time, reasonably request upon reasonable notice. In
addition, Xxxxx shall hold itself ready to assist the Company in evaluating and
negotiating particular contracts or transactions, if requested to do so by the
Company, upon reasonable notice.
2. As compensation for the services described in paragraph 1 above,
the Company shall pay to Xxxxx a fee of $90,000, for the full term of 24
months, payable in full in advance on the date hereof. In addition to the
$90,000 compensation hereunder, the Company will reimburse Xxxxx for any and
all reasonable expenses incurred by Xxxxx in the performance of its duties
under paragraphs 3 or 4 hereunder, and Xxxxx shall account for such expenses to
the Company. Such reimbursement shall accumulate and be paid monthly. No
expenses shall be incurred or reimbursed without the prior consent of the
Company. Nothing contained herein shall prohibit Xxxxx from receiving any
additional compensation under paragraphs 3 and 4 herein or otherwise.
2
3. In addition, Xxxxx shall hold itself ready to assist the
Company in evaluating and negotiating particular contracts or transactions, if
requested to do so by the Company, upon reasonable notice, and will undertake
such evaluations and negotiations upon prior written agreement as to additional
compensation to be paid by the Company to Xxxxx with respect to such
evaluations and negotiations.
4. The Company and Xxxxx further acknowledge and agree that Xxxxx
may act as a finder or financial consultant in various business transactions in
which the Company may be involved, such as mergers, acquisitions or joint
ventures. The Company hereby agrees that if in the event Xxxxx shall first
introduce to the Company another party or entity, and that as a result of such
introduction, a transaction is consummated, the Company shall pay to Xxxxx a
fee equal to five percent of the first $1 million, four percent of the next $1
million, three percent of the next $1 million, two percent of the next $1
million and one percent thereafter of the consideration received by the Company
from parties introduced to the Company by Xxxxx in non-financing related
transactions (including mergers, acquisitions, joint ventures and other
business transactions) consummated by the Company with a party introduced to
the Company by Xxxxx. Such fee shall be paid in cash at the closing of the
transaction to which it relates or at such time as the consideration is
received or paid by the Company, and shall be payable whether or not the
transaction involves stock, or a combination of stock and cash, or is made on
the installment sale basis. In addition, if the Company shall, within 12 months
immediately following the termination of this Agreement, consummate a
transaction with any party first introduced by Xxxxx to the Company prior to
such termination, the Company shall pay to Xxxxx a fee with respect to such
transaction calculated in accordance with this paragraph.
5. All obligations of Xxxxx contained herein shall be subject to
Xxxxx'x reasonable availability for such performance, in view of the nature of
the requested service and the amount of notice received. Xxxxx shall devote
such time and effort to the performance of its duties hereunder as Xxxxx shall
determine is reasonably necessary for such performance. Xxxxx may look to such
others for such factual information, investment recommendations, economic
advice and/or research, upon which to base its advice to the Company hereunder,
as it shall deem appropriate. The Company shall furnish to Xxxxx all
information relevant to the performance by Xxxxx of its obligations under this
Agreement, or particular projects as to which Xxxxx is acting as advisor, which
will permit Xxxxx to know all facts material to the advice to be rendered, and
all material or information reasonably requested by Xxxxx. In the event that
the Company fails or refuses to furnish any such material or information
reasonably requested by Xxxxx, and thus prevents or impedes Xxxxx'x performance
hereunder, any inability of
3
Xxxxx to perform shall not be a breach of its obligations hereunder.
6. Nothing contained in this Agreement shall limit or restrict the
right of Xxxxx or of any partner, employee, agent or representative of Xxxxx,
to be a partner, director, officer, employee, agent or representative of, or
to engage in, any other business, whether of a similar nature or not, nor to
limit or restrict the right of Xxxxx to render services of any kind to any
other corporation, firm, individual or association.
7. Xxxxx will hold in confidence any confidential information which
the Company provides to Xxxxx pursuant to this Agreement unless the Company
gives Xxxxx permission in writing to disclose such confidential information to
a specific third party. In addition, all confidential information which the
Company provided to Xxxxx in connection with its initial public offering shall
be considered confidential information for purposes of this Agreement.
Notwithstanding the foregoing, Xxxxx shall not be required to maintain
confidentiality with respect to information (i) which is or becomes part of the
public domain through no fault of Xxxxx; (ii) of which it had independent
knowledge prior to disclosure; (iii) which comes into the possession of Xxxxx in
the normal and routine course of its own business from and through independent
non-confidential sources; or (iv) which is required to be disclosed by Xxxxx by
governmental requirements. If Xxxxx is requested or required (by oral
questions, interrogatories, requests for information or document subpoenas,
civil investigative demands, or similar process) to disclose any confidential
information supplied to it by the Company, or the existence of other
negotiations in the course of its dealings with the Company or its
representatives, Xxxxx shall, unless prohibited by law, promptly notify the
Company of such request(s) so that the Company may seek an appropriate
protective order.
8. Each of the Company and Xxxxx agrees to indemnify and hold harmless
each other, and their respective partners, employees, agents, representatives
and controlling persons (and the officers, directors, employees, agents,
representatives and controlling persons of each of them) from and against any
and all losses, claims, damages, liabilities, costs and expenses (and all
actions, suits, proceedings or claims in respect thereof) and any legal or
other expenses in giving testimony or furnishing documents in response to a
subpoena or otherwise (including, without limitation, the cost of
investigating, preparing or defending any such action, suit, proceeding or
claim, whether or not in connection with any action, suit, proceeding or claim
in which Xxxxx or the Company is a party), as and when incurred, directly or
indirectly, caused by, relating to, based upon or arising out of Xxxxx'x
service pursuant to this Agreement. The Company further agrees that Xxxxx
shall incur no liability to the Company or any other party on account of this
Agreement or any acts of omissions
3
4
arising out of or related to the actions of Xxxxx relating to this Agreement or
the performance or failure to perform any services under this Agreement except
for Xxxxx'x intentional or willful misconduct. This paragraph shall survive the
termination of this Agreement. Notwithstanding the foregoing, no party otherwise
entitled to indemnification shall be entitled thereto to the extent such party
has been determined to have acted in a manner which has been deemed gross
negligence or wilful misconduct regarding the matter for which indemnification
is sought herein.
9. This Agreement may not be transferred, assigned or delegated by
any of the parties hereto without the prior written consent of the other party
hereto.
10. The failure or neglect of the parties hereto to insist, in any
one or more instances, upon the strict performance of any of the terms or
conditions of this Agreement, or their waiver of strict performance of any of
the terms or conditions of this Agreement, shall not be construed as a waiver or
relinquishment in the future of such term or condition, but the same shall
continue in full force and effect.
11. This Agreement is for a term of twenty-four (24) months and may
not be terminated by the Company. This Agreement may be terminated by Xxxxx at
any time upon 30 days' notice; provided Xxxxx shall repay any portion of their
fee which was not earned on the effective date of such termination ($3,750
multiplied by the number of months remaining in this agreement). Paragraphs 4,
7 and 8 shall survive the expiration or termination of this Agreement under all
circumstances.
12. Any notices hereunder shall be sent to the Company and to Xxxxx
at their respective addresses set forth above. Any notice shall be given by
registered or certified mail, postage prepaid, and shall be deemed to have been
given when deposited in the United States mail. Either party may designate any
other address to which notice shall be given, by giving written notice to the
other of such change of address in the manner herein provided.
13. This Agreement has been made in the State of New York and shall
be construed and governed in accordance with the laws thereof without giving
effect to principles governing conflicts of law.
14. This Agreement contains the entire agreement between the
parties, may not be altered or modified, except in writing and signed by the
party to be charged thereby, and supersedes any and all previous agreements
between the parties relating to the subject matter hereof.
4
5
15. This Agreement shall be binding upon the parties hereto, the
indemnified parties referred to in Section 7, and their respective heirs,
administrators, successors and permitted assigns.
If you are in agreement with the foregoing, please execute two copies
of this letter in the space provided below and return them to the undersigned.
Very truly yours,
XXXXX XXXXXXX SECURITIES, LLC
By:
----------------------------
An Authorized Representative
ACCEPTED AND AGREED TO AS OF
THE DATE FIRST ABOVE WRITTEN
XXXXX XXXX, INC.
By:
--------------------------
Xxxxxxxx Xxxxxx
President
5
