Exhibit 10.117
XXXXXXXX INDUSTRIES, LTD.
January 4, 1999
Xx. Xxxxx Xxxxxx
Secretary/Chief Financial Officer
Play Co. Toys & Entertainment Corp.
000 Xxxxxxxxx Xxxxx
Xxx Xxxxxx, Xxxxxxxxxx 00000
Re: Play Co. Toys & Entertainment/Xxxxxxxx Industries
Dear Xxx:
This Letter Agreement ("Agreement") will confirm that Xxxxxxxx Industries,
Ltd. ("Xxxxxxxx") intends to act as an exclusive placement agent and financial
advisor for Play Co. Toys & Entertainment Co. ("Play Co." or the "Company") in
connection with the proposed offering, on a best efforts basis, of convertible
debentures (the "Debentures") for a total amount of $5,000,000 (the
"Transaction" or the "Offering"). The terms and conditions of the Transaction
are substantially defined and set forth in Exhibit "A".
In consideration of the premises and the mutual covenants and agreements
contained herein, the parties agree as follows:
1. Engagement: Except for the provisions which are intended to apply in the
future, this Agreement shall end the earlier of (a) six (6) months from the
execution of this Agreement which, at the sole option of Xxxxxxxx, may be
extended for an additional two (2) months or (b) the closing of the Transaction
(the "Engagement Period"). The Company agrees that, during the Engagement
Period, all discussions with Potential Investors shall be conducted by Xxxxxxxx
and the Company shall inform Xxxxxxxx of any contacts with Potential Investors.
The Company shall not sell or issue any securities of the Company of the nature
and type encompassed in the Offering during the Engagement Period without the
consent of Xxxxxxxx.
It is specifically understood and agreed that the Offering shall be only to
non-US citizens and non-residents of the United States and shall be only to
those investors residing in or located in Europe and that no investor will be
accepted by the Company who is a resident of or citizen of the United States
(only such non-resident, non-citizen shall be deemed a "Potential Investor").
2. Information: In connection with Xxxxxxxx'x activities on behalf of the
Company, the Company will furnish Xxxxxxxx with information concerning the
Company, as is reasonably required. To the best of the Company's knowledge, the
information provided in written form by the Company will be materially complete
and correct and will not contain any untrue statement of material fact or omit
to state a material fact necessary in order to make the statements therein not
misleading in light of the circumstances under which the statements are made. At
each funding an officer of the Company will deliver a signed certificate
representing the veracity of such statements.
The Company acknowledges and agrees that in rendering services hereunder,
Xxxxxxxx will be using and relying solely on the information provided by the
Company without independent verification thereof by Xxxxxxxx or independent
appraisal by Xxxxxxxx of any of the Company's assets. Xxxxxxxx does not assume
responsibility for the accuracy or completeness of any information regarding the
Company or the Offering.
3. Fees, Expenses and Additional Services: The Company agrees to pay to the
provider all out-of-pocket expenses incurred in connection with the Transaction
including, but not limited to, accounting fees, legal fees, printing, filing
fees, etc. immediately upon receipt of a xxxx therefor.
The Company will pay Xxxxxxxx one-and-one-half (1-1/2%) percent of the face
amount of each Debenture funded as a non-accountable expense allowance to cover
Xxxxxxxx expenses.
On the closing of any portion of the Offering, Xxxxxxxx shall receive a fee
equal to eight (8%) percent of the face amount of the Debenture funded as a
placement fee.]
4. Termination: If the Company decides not to proceed with the Offering for
any reason, or if Xxxxxxxx decides not to proceed with the Offering because of a
material breach by the Company of its representations, warranties or covenants
in this Agreement or as a result of material adverse changes in the affairs of
the Company, or failure to meet the General Conditions set forth in this
Agreement, the Company will be obligated to reimburse Xxxxxxxx for its
accountable expenses. Should Xxxxxxxx have sold and actually received funds in
escrow any of the Debentures and the Company elects not to close on the funds,
the Company shall pay to Xxxxxxxx a fee of eight (8%) percent of the amount of
funds in escrow. Xxxxxxxx shall have no liability to the Company for any reason
should it choose not to proceed with the Offering contemplated hereby. In
addition, if the Company elects not to proceed with the proposed Offering on the
material terms specified herein for any reason (except Xxxxxxxx'x failure to
close) and subsequently engages in any public offering, private placement or
other transaction between the Company and any entity offering the same or
similar securities to the same Potential Investor within two (2) months
following the Company's election not to proceed then Xxxxxxxx shall receive a
fee in connection therewith equal to eight (8%) percent of the amount raised or
consideration received in any such transaction. Furthermore, the Company agrees
to pay eight (8%) percent finder's fee to Xxxxxxxx if the Company completes a
Transaction in which Xxxxxxxx introduced the Company to the other party (except
for registered broker/dealers) for a period of eight (8) months from the
execution of this Agreement.]
5. Indemnification: In consideration of this Agreement the Company agrees
to indemnify and hold Xxxxxxxx, its affiliates and their respective officers and
directors, employees and agents and any other person controlling Xxxxxxxx or any
of its affiliates ("Indemnified Person") from and against any losses, claims,
damages or liabilities relating to or arising out of or in connection with the
Engagement and will reimburse each Indemnified Person for all expenses
(including fees and expenses of counsel) as they are incurred in connection with
investigating, preparing, pursuing or defending any action, claims, suit or
proceeding arising out of or in connection with the Engagement. The Company,
however, will not be responsible for any losses, claims, damages or liabilities
or expenses relating thereto that are finally judicially determined to have
resulted from the wilful misconduct or recklessness of a material nature of any
Indemnified Person. The Company also agrees that no Indemnified Person shall
have any liability to it, for or in connection with the Engagement except for
any such liability for losses, claims, damages or liabilities incurred that are
finally judicially determined to have resulted from the wilful misconduct or
recklessness of a material nature of such Indemnified Person. Each party agrees
to give to the other timely notice of any such claim or demand to permit the
other to conduct such defenses as are appropriate.
6. Entire Agreement: This Agreement and Exhibit "A" incorporate the entire
understanding of the parties with respect to the subject matter of this
Agreement and supersedes all previous agreements or understandings. This
Agreement may be modified only by a written agreement signed by both parties.
This Agreement may not be assigned by either party. In the event either party
shall resort to legal counsel in order to construe or enforce any rights or
obligations hereunder, the prevailing party shall be entitled to reasonable
costs and expenses, including attorneys' fees in connection therewith.
7. Resolution of Disputes: This Agreement shall be interpreted and governed
by the laws of the State of Delaware. Xxxxxxxx and the Company will attempt to
settle any claim or controversy arising out of this Agreement through
consultation and negotiation in good faith and a spirit of mutual cooperation.
If those attempts fail then the dispute will be mediated by a mutually
acceptable mediator to be chosen by Xxxxxxxx and the Company within fifteen (15)
days after written notice from either party demanding mediation. Neither party
may unreasonably withhold consent to the selection of a mediator, but the
parties will share the cost of the mediation equally. Any dispute which the
parties cannot resolve through negotiation or mediation within six (6) months
from the date of the initial demand for it by one of the parties, may then be
submitted to the courts for resolution. The use of mediation will not be
construed under the doctrine of laches, waiver or estoppel to adversely effect
the rights of either party. Nothing herein shall prevent either party from
resorting to judicial proceedings if (a) good faith efforts to resolve the
dispute under these procedures have been unsuccessful or (b) interim relief from
a court is necessary to prevent serious and irreparable injury.
8. General Conditions: Xxxxxxxx'x intention as expressed in this Agreement
is subject to the following General Conditions:
(a) In its sole discretion, Xxxxxxxx shall be satisfied with the results of
its due diligence of the Company;
(b) there have been no material adverse changes in the business or
financial condition of the Company. In its sole discretion Xxxxxxxx shall be
satisfied with the Company's progress as well as its outlook for the future.
(c) The Company will provide financial projections that have been reviewed
and approved by both the Company and Xxxxxxxx for a period to be agreed upon
between the parties.
(d) The preparation of appropriate Offering circulars at the Company's
expense for distribution to potential investors by Xxxxxxxx reasonably
satisfactory to Xxxxxxxx.
(e) The completion of satisfactory due diligence on the Company and its
principal managers.
Please confirm that the foregoing is in accordance with our understanding
by signing and returning to us the enclosed copy of this Agreement.
Yours very truly, AGREED TO THIS ___ DAY
OF JANUARY, 1999
XXXXXXXX INDUSTRIES, LTD.
By__________________________ PLAY CO. TOYS & ENTERTAINMENT CORP.
By
90885-1
