AGENCY AGREEMENT
August
14, 2007
000
Xxxxxxxxx Xxxxx Xxxxxxxx, Xxxxx 000
Iselin,
New Jersey 08830
United
States
| Attention: |
Xx.
Xxxxxx X. Xxxxxx
|
President
and Chief Executive Officer
Dear
Sirs:
Re:
Offering
of Shares
Xxxxx
Capital Limited (the “Agent”), understands that SyntheMed, Inc. (the
“Corporation”), a Delaware corporation, proposes to issue to investors secured
by the Agent, up to 6,000,000 shares (the “Shares”) of the Corporation’s Common
Stock, par value $0.001 per share (“Common Stock”). The Shares shall be issued
and sold at a price of $1.00 per Share (the “Issue Price”). The Shares shall be
sold pursuant to a subscription agreement, as may be supplemented upon mutual
agreement of the Corporation and the Agent the form of which is attached hereto
as Appendix I (the “Subscription Agreement”). The offering of the Shares (the
“Offering”) will be consummated in one or more closings, the final closing to
occur on or about August 31, 2007, or such other date mutually agreed to by
the
Corporation and the Agent (the date of each closing being referred to herein
as
a “Closing Date”). There is no minimum number of Shares being offered in the
Offering.
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1.
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Appointment
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The
Corporation hereby appoints the Agent as its non-exclusive agent and the Agent
accepts the appointment and agrees to act on a “best efforts” basis as a
non-exclusive agent of the Corporation to secure investors for the issuance
of
the Shares by way of private placement to institutional and other sophisticated
investors or other eligible investors subject to the terms and conditions and
in
reliance upon the representations, warranties and covenants of the Corporation
set out in this Agreement.
The
Agent
shall be entitled to retain sub-agents selected by it to participate in the
soliciting of offers to purchase the Shares, provided that the Agent receives
from each such sub-agent its agreement to be bound by the obligations of the
Agent hereunder prior to any such appointment. The fees payable to such
sub-agents shall be the responsibility and for the account of the
Agent.
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2.
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Sales
Restrictions
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The
Agent
represents and agrees that it will comply with the restrictions on offers and
sales of the Shares set forth in Schedule “A” hereto, as well as the other
provisions thereof, all of which are hereby incorporated by reference herein
and
form a part hereof.
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3.
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Commission
and Broker Warrant
|
In
consideration of the services rendered and to be rendered by the Agent in acting
as agent of the Corporation on a best efforts basis to secure investors for
the
issuance of the Shares, the Corporation agrees to pay to the Agent on the
Closing Date a commission (the “Commission”) equal to 7% of that portion of
the gross proceeds of the Shares sold on the Closing Date to purchasers secured
by the Agent, payable at the election of the Agent in either cash or Shares
at
the Issue Price (“Commission Shares”) or a combination of the two.
In
further consideration of the services rendered and to be rendered by the Agent
described above, the Corporation agrees to issue to the Agent for no additional
consideration, a warrant (the “Broker Warrant”) to purchase an aggregate number
of Shares equal to 7% of the aggregate number of Shares issued on the Closing
Date to purchasers secured by the Agent. The Broker Warrant shall have a term
of
four (4) years after the date of issue and shall be exercisable to acquire
Shares at a price of $1.10 per Share. Any Commission payable or Broker Warrant
issuable to the Agent may, at the direction of the Agent, be issued to any
subagents retained by the Agent in accordance with this Agreement.
If
for
any reason the Offering does not close and within a three (3) year period after
termination of the Offering the Corporation raises funding through one or more
investors introduced to the Corporation for the first time by the Agent (“Agent
Investors”), the Agent shall be entitled to the Commission and Broker Warrants
in respect thereof as if the Offering had not been terminated and the gross
proceeds of sale raised in such financing(s) had been raised under the Offering.
The Agent will after the Closing Date promptly provide the Corporation with
a
list of Agent Investors.
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4.
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Closing
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(a)
|
The
issuance of the Shares shall be completed (the “Closing”) at the offices
of the Corporation, or such other place or places as the Corporation
and
the Agent may agree, at 10:00 a.m. (Eastern Standard Time) (the “Closing
Time”) on the Closing Date.
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(b)
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On
or prior to each Closing Date, the Agent shall provide to the Corporation
a subscription agreement from each purchaser of Shares (a “Purchaser”) who
is to acquire Shares on such Closing Date, together with a selling
stockholder questionnaire. Purchasers shall be required to complete
and
sign the form of Subscription Agreement attached hereto as Appendix
I,
together with a selling stockholder
questionnaire.
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(c)
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At
the Closing Time on each Closing Date, upon satisfaction of the conditions
contained herein, the Agent shall pay or cause payment to be made
of the
net purchase price of the Shares sold by the Agent in United States
funds
by wire transfer to such bank and account as may be designated by
the
Corporation, or in such other manner as may be agreed with the
Corporation, such net purchase price to be equal to the aggregate
Issue
Price of the Shares sold by the Agent less the cash portion of the
Commission (if the Agent elects to receive all or a part thereof
in cash)
and the amount in reimbursement of expenses referred to in section
8
hereof. Such payment and delivery shall be made
against:
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2
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(i)
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delivery
by the Corporation to its transfer agent of instructions to issue
certificates representing (A) the Shares to be issued on the Closing
Date
registered in such name or names as are directed in the Subscription
Agreements and (B) the Commission
Shares;
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(ii)
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delivery
of the Commission and the Broker Warrants;
and
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(iii)
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delivery
to the Agent of copies of the certificates, opinions and other documents
contemplated hereby.
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5.
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Representations,
Warranties and Covenants of the
Corporation
|
The
Corporation represents, warrants and covenants to the Agent as of the date
hereof and as of the Closing Date, which representations, warranties and
covenants shall survive the Closing for a period of two years and any
investigation made by the Agent, that:
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(a)
|
the
Corporation is a validly existing corporation in good standing under
the
laws of the jurisdiction in which it is incorporated, and the Corporation
has no subsidiaries;
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(b)
|
the
Corporation is duly qualified and authorized to do business in the
jurisdiction(s) in which it carries on business or to own property
where
required under the laws of the jurisdiction(s) in which any such
property
is located;
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(c)
|
the
Corporation is current with all material filings required to be made
under
the laws of any jurisdiction in which it carries on any material
business,
and the Corporation has all necessary licenses, leases, permits,
authorizations and other approvals necessary to permit it to conduct
its
business as currently conducted, except where the failure to have
any such
license, lease, permit, authorization or approval would not have
a
material adverse effect on the Corporation and its
business;
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(d)
|
the
audited financial statements of the Corporation as at and for the
year
ended December 31, 2006 and the interim financial statements of the
Corporation as at and for the three -month period ended March 31,
2007
present fairly, in all material respects, the financial position
of the
Corporation as at the respective period-end dates, and the results
of its
operations and the changes in its financial position for the 12-month
period ended December 31, 2006 in the case of the audited financial
statements and 3-month period ended March 31, 2007 in the case of
the
interim financial statements, all in accordance with generally accepted
accounting principles, and, since March 31, 2007, there has been
no
material adverse change in the business, affairs or financial or
other
condition of the Corporation or any of its subsidiaries, except as
disclosed in the notes to the financial statements for the quarter
then
ended;
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3
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(e)
|
the
Corporation has all requisite power and authority to carry out its
obligations under this Agreement, the
Subscription Agreement,
the investor rights agreement in the form set forth in Annex A-1
to the
Subscription Agreement (the “Investor Rights Agreement”) and the Broker
Warrants;
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(f)
|
this
Agreement, the Subscription Agreement and the Investor Rights Agreement
have been, and the Broker Warrants will be on the Closing Date, duly
authorized, executed and delivered by the Corporation and constitute
or on
the Closing Date will constitute, legal, valid and binding obligations
of
the Corporation enforceable in accordance with their terms except
that:
(i) the enforcement hereof or thereof may be limited by bankruptcy,
insolvency, reorganization and other laws affecting the enforcement
of
creditors’ rights generally, (ii) rights of indemnity thereunder may
be limited under applicable law, and (iii) equitable remedies,
including without limitation specific performance and injunctive
relief,
may be granted only in the discretion of a court of competent
jurisdiction;
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(g)
|
the
Shares are or on the Closing Date will be duly and validly authorized
and,
when issued and delivered against payment therefor, will be duly
and
validly issued, fully paid and non-assessable shares in the capital
stock
of the Corporation;
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(h)
|
the
Corporation will reserve a sufficient number of shares of Common
Stock
unissued as may be required to be issued pursuant to the exercise
of the
Broker Warrants and, when issued and delivered upon such exercise,
such
shares of Common Stock will be duly and validly issued as fully paid
and
non-assessable shares in the capital stock of the Corporation;
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(i)
|
the
authorized capital of the Corporation consists of 150,000,000 shares
of
Common Stock and 5,000,000 shares of preferred stock, par value of
$0.01
per share. Of the preferred stock, 500,000 shares have been designated
as
Series A Convertible Preferred Stock, 1,116,500 shares have been
designated as Series B Convertible Preferred Stock and 663,000 shares
have
been designated as Series C Convertible Preferred Stock. As of March
31,
2007 there were 83,761,185 shares of Common Stock and no shares of
preferred stock outstanding. In addition, as of that date, the Corporation
had an aggregate of 15,562,602 shares of Common Stock reserved for
issuance upon exercise or conversion of the following outstanding
securities: (A) options which have been granted under the Corporation’s
stock option plans and other agreements, to purchase an aggregate
of
14,087,602 shares of Common Stock; and (B) warrants issued to the
Agent or
its designees to purchase an aggregate of 1,475,000 shares of Common
Stock;
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(j)
|
the
Corporation is not, and at the Closing Date will not be: (i) in
breach or violation of any of the terms or provisions of, or in default
under, this Agreement, the Subscription Agreement, any other Subscription
Agreement for the purchase of Shares, the Investor Rights Agreement,
the
Broker Warrants, any indenture, mortgage, deed of trust or loan agreement
(except as disclosed in the Corporation’s filings with the United States
Securities and Exchange Commission), other agreement (written or
oral) or
instrument to which it is a party or by which it is bound or to which
any
of its property or assets is subject, which breach or violation or
the
consequences thereof would result in a material adverse change to
it or
its business; or (ii) in violation of the provisions of its articles,
by-laws, resolutions or any statute or any other rule or regulation
of any
court or governmental agency or body having jurisdiction over it
or any of
its properties which violation or the consequences thereof would
result in
a material adverse change to it or its
business;
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4
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(k)
|
the
issue and sale of the Shares, Broker Warrants, any shares of Common
Stock
on the exercise of the Broker Warrants and the performance and
consummation of the transactions contemplated herein will not conflict
with or result in a breach or violation of any of the terms or provisions
of, or constitute a default under, any indenture, mortgage, deed
of trust,
loan agreement or other agreement (written or oral) or instrument
to which
the Corporation or any subsidiary is bound or to which any of the
property
or assets of the Corporation or any subsidiary is subject, which
breach or
violation or the consequences thereof would result in a material
adverse
change to the Corporation or its business, nor will any such action
conflict with or result in any violation of the provisions of the
articles, by-laws or resolutions of the Corporation or any statute
or any
order, rule or regulation of any court or governmental agency or
body
having jurisdiction over the Corporation or any subsidiary or any
of its
properties which violation or the consequences thereof would result
in a
material adverse change to the Corporation or its
business;
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(l)
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the
Corporation has established on its books reserves which are adequate
for
the payment of all taxes not yet due and payable; there are no liens
or
other liabilities for taxes on the assets of the Corporation except
for
taxes not yet due; there are no audits of any of the tax returns
of the
Corporation which are known by the Corporation’s management to be pending
and there are no claims which have been or may be asserted relating
to any
such tax returns which, if determined adversely, would result in
the
assertion by any government or agency of any deficiency having a
material
adverse effect on the properties, business or assets of the
Corporation;
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(m)
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the
Corporation has good and valid title to its properties, leaseholds
and
assets, including without limitation the properties, leaseholds and
assets
reflected in the balance sheet as of March 31, 2007 referred to in
clause 5(d) above, except properties, leaseholds and assets disposed
of
since such date at fair market value in the ordinary course of business,
and has good title to all its leasehold estates, in each case subject
to
no mortgage, pledge, lien, lease, encumbrance, charge, rights of
first
refusal or options to purchase, whether or not relating to extensions
of
credit or the borrowing of money, other than as disclosed in such
balance
sheet except as incurred in the ordinary course of business since
the date
of such balance sheet, and except in any event where the failure
to hold
good title or the existence of a mortgage, pledge, lien, lease,
encumbrance, charge, right of first refusal or option to purchase
would
not have a material adverse effect on the Corporation or its business;
there exists no condition which interferes with the economic value
or use
of such properties and assets and all tangible assets are in good
working
condition and repair (subject to ordinary wear and tear) except where
the
existence of any such condition would not have a material adverse
effect
on the Corporation or its business;
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5
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(n)
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the
Corporation owns, is licensed or has applied for registration of,
all
patents, trade-marks, service marks, trade names, and copyrights
necessary
for the conduct of its business, except where the failure to so own
or
apply for registration would not have a material adverse effect on
the
Corporation or its business; to the best of the knowledge, information
and
belief of the Corporation none of the past or present activities
of the
Corporation or the products, services or assets of the Corporation
infringe or constitute an unauthorized use of any proprietary rights
of
others, and the Corporation has not received any notice of infringement
of, or conflict with, asserted rights of others with respect to any
patent, trade-xxxx, service xxxx, trade name, or copyright that,
individually or in the aggregate, if the subject of an unfavorable
decision, ruling, or finding, would result in a material adverse
change to
the Corporation or its business;
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(o)
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the
Corporation has taken reasonable measures to protect and preserve
the
confidentiality of all trade secrets and other non-patented proprietary
information of the Corporation, including without limitation the
procurement of proprietary invention assignments and non-disclosure
and
non-competition agreements from employees, consultants, subcontractors,
customers and other persons who have access to such
information;
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(p)
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the
Corporation has filed all necessary federal, state and municipal
property,
income and franchise tax returns and has paid all taxes shown as
due
thereon or otherwise owed by it to any taxing authority except those
contested in good faith and for which appropriate amounts have been
reserved in accordance with generally accepted accounting principles;
there is no tax deficiency which has been, or to the best of the
knowledge, information and belief of the Corporation might be, asserted
against the Corporation which would materially affect the business
or
operations of the Corporation; the Corporation has paid all applicable
federal and state payroll and withholding
taxes;
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(q)
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there
is no collective bargaining or other union agreement to which the
Corporation is a party or by which it is bound, or which is currently
being negotiated; the Corporation does not sponsor, maintain or contribute
to any pension, retirement, profit sharing, incentive compensation,
bonus
or other employee benefit plan, including without limitation any
employee
benefit plan covered by Title 4 of the Employee Retirement Income
Security
Act of 1974 (“ERISA”) or any “multi-employer plan” as defined in Section
4001(a)(3) of ERISA, or any other employee benefit plan; to the best
of
the knowledge, information and belief of the Corporation, (i) no
employee of the Corporation is a party to or bound by any agreement,
contract or commitment, or subject to any restrictions, particularly
but
without limitation in connection with any previous employment of
any such
person, which would result in a material adverse change to the Corporation
or its business, and (ii) no senior officer has any present intention
of terminating his employment with the Corporation, and the Corporation
has no present intention of terminating any such employment;
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(r)
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there
is no adverse claim, action, proceeding or investigation pending
or, to
the knowledge, information and belief of the Corporation, threatened,
which questions the validity of the issue or sale of the Shares,
Broker
Warrants or any shares of Common Stock on exercise of the Broker
Warrants
or the validity of any action taken or to be taken by the Corporation
in
connection with this Agreement, the Subscription Agreement or the
Investor
Rights Agreement or which would result in any material adverse change
in
the financial condition, results of operations, business or prospects
of
the Corporation;
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6
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(s)
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the
Corporation will permit the Agent and its legal counsel to conduct
all due
diligence which the Agent may reasonably require; and
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(t)
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during
the period commencing with the engagement of the Agent on the date
of this
Agreement and ending on the date on which the full amount of the
Offering
is sold or the earlier date of termination of the Offering period
(the
“Final Closing Date”), the Corporation will inform the Agent in writing of
the full particulars of any material change (actual, anticipated
or
threatened) in the assets, liabilities, business or the financial
condition of the Corporation.
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6.
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Closing
Conditions for the Benefit of the
Agent
|
The
obligations of the Agent hereunder are subject to the satisfaction, on or before
the Closing Time, of the following conditions:
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(a)
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the
Corporation shall have complied with all of its obligations hereunder;
the
representations and warranties of the Corporation contained herein
shall
be true and correct in all material respects on and as of each Closing
Date as if made on and as of such Closing Date; and the Agent shall
have
received on each Closing Date a certificate, dated as of such Closing
Date
and signed by one or more executive officers or directors of the
Corporation on behalf of the Corporation and not in his or their
personal
capacity, to the foregoing effect;
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(b)
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the
Agent shall have received on and as of each Closing Date the favourable
opinion of the Corporation’s legal counsel on such matters as the Agent
may reasonably request, including:
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(i)
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the
Corporation is incorporated and validly existing under the laws of
the
jurisdiction in which it is incorporated and has the corporate power
and
authority to conduct its business as currently conducted by it and
to
issue and sell the Shares and Broker Warrants (the Shares and the
Broker
Warrants collectively referred to as the “Securities”) and to enter into
and carry out its obligations under this Agreement, the Subscription
Agreement, the Investor Rights Agreement, and the Broker Warrants;
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(ii)
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as
to the Corporation's authorized and issued and outstanding
capital;
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(iii)
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each
of this Agreement, the Subscription Agreement, the Investor Rights
Agreement and the Securities has been duly authorized, executed and
delivered by the Corporation and, as applicable, is a legal, valid
and
binding obligation of the Corporation enforceable against it in accordance
with its terms;
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7
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(iv)
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all
necessary action has been taken by the Corporation to authorize the
issue
of up to 6,000,000 Shares and the issue to the Agent of up to 196,000
Commission Shares and Broker Warrants exercisable for up to 420,000
shares
of Common Stock and the Corporation has sufficient authorized but
unissued
shares of Common Stock as may be required to be issued upon the exercise
of the Broker Warrant;
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(v)
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the
execution and delivery of this Agreement, the Subscription Agreement
and
the Investor Rights Agreement and the completion of the transactions
contemplated hereby and thereby, the issue of the Shares, the Commission
Shares and the Broker Warrant, and the issue of the shares of Common
Stock
issuable upon exercise of the Broker Warrant do not violate or constitute
a breach of any provisions of the articles of incorporation or by-laws
of
the Corporation, any material contract or other material agreement
to
which it is a party or by which it is bound and of which such counsel
is
aware, or any New York, Delaware corporate or United States law or
regulation (other than federal and state Securities or “blue sky” laws, as
to which such counsel expresses no opinion in this
paragraph);
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(vi)
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the
Shares issued to the investors and the Commission Shares issued to
the
Agent have been duly and validly issued by the Corporation and are
outstanding as fully paid and non-assessable shares in the capital
of the
Corporation and the shares of Common Stock issuable upon exercise
of the
Broker Warrant will, when issued in accordance with the respective
terms
and conditions of the Broker Warrant, be validly issued as fully
paid and
non-assessable shares in the capital of the
Corporation;
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(vii)
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the
certificates representing the Shares, Commission Shares and Broker
Warrant
comply with the requirements of the state laws and any federal laws
of the
United States applicable to the Corporation and such certificates
have
been duly and properly approved by the directors of the
Corporation;
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(viii)
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the
exemption from any consent, approval, authorization, order, registration,
filing or qualification of or with any governmental authority of
the
United States (or New York or Delaware corporate authority) (other
than
federal and state securities or “blue sky” laws, as to which such counsel
expresses no opinion in this paragraph) for the valid authorization,
issue, sale and delivery of the Shares and Commission Shares and
the
shares of Common Stock issuable upon exercise of the Broker Warrant
and
the issue and delivery of the Broker Warrant; and
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(ix)
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the
exemption from registration of the issuance of the Shares, Commission
Shares and Broker Warrant (including the shares of Common Stock underlying
the Broker Warrant under the terms contemplated by the Subscription
Agreement and the Agency
Agreement).
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8
In
giving
the opinions contemplated above, legal counsel to the Corporation shall be
entitled to rely, where appropriate, upon opinions of local counsel and, as
to
matters of fact, to rely upon the representations and warranties of Purchasers
contained in the executed Subscription Agreements, a certificate of fact of
the
Corporation signed by those officers in a position to have knowledge of such
facts and their accuracy, and certificates of such public officials and other
persons as are necessary or desirable, and may qualify its opinion described
in
(iii) above with respect to (1) bankruptcy, insolvency, reorganization and
other
laws affecting the enforcement of creditors' rights generally and (2)
limitations on the availability of equitable remedies such as specific
performance, and its opinion may include other reasonable and standard opinion
qualifications;
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(c)
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the
Agent shall have received copies of the Subscription Agreement and
the
Investor Rights Agreement executed by the
Corporation;
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(d)
|
the
Agent shall have received such other agreements, certificates, opinions
or
documents as the Agent may reasonably request;
and
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(e)
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the
fulfilment, to the reasonable satisfaction of counsel for the Agent,
of
all legal requirements to permit the offer and sale of the Shares
and the
issue of the Broker Warrant to the
Agent.
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The
foregoing conditions are included for the benefit of the Agent and may be waived
in writing by the Agent, in whole or in part.
Notwithstanding
anything contained in this Agreement, the Agent may by written notice to the
Corporation terminate this Agreement at any time before the Closing Time if,
in
the opinion of the Agent, there shall have been such a change in national or
international financial, political or economic conditions or currency exchange
rates or exchange controls as would in its reasonable view be likely to
prejudice materially the success of the Offering or distribution of the Shares
or if the Agent is not reasonably satisfied with the results of its due
diligence review of the Corporation and, upon notice being given, the parties
to
this Agreement shall (except for the liability of the Corporation in relation
to
expenses as provided in section 8 and except for any liability arising before
or
in relation to such termination) be released and discharged from their
respective obligations under this Agreement.
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7.
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Confidentiality
|
The
Agent
agrees that it will not disclose the terms of the Offering or any information
it
may have acquired from the Corporation in the course of executing this Agency
Agreement which the Corporation has identified as material non-public
information, except to the extent (i) that such terms or other information
becomes generally available to the public other than by disclosure in violation
of this Agency Agreement, (ii) that such information was properly within
the Agent’s possession prior to being furnished by the Corporation,
(iii) that such information becomes available to the Agent on a
non-confidential basis, such as through disclosure by third parties who have
the
right to disclose the information, and (iv) compelled by judicial process,
provided that in the event of compulsion by judicial process the Agent will
inform the Corporation promptly upon its receipt of notice of judicial process
compelling such disclosure.
9
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8.
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Expenses
|
In
further consideration of the agreement with the Agent herein contained, the
Corporation covenants and agrees to reimburse the Agent, regardless of whether
the Offering is completed, for the Agent’s reasonable fees and expenses
including (without limitation) reasonable fees and expenses of Agent’s legal
counsel, due diligence expenses, travel expenses and expenses incurred in
connection with the holding of roadshows, investor meetings and presentations
and printing and preparation of any offering documents and marketing materials
(collectively the “Expenses”). The Corporation shall not be responsible for
Agent’s legal expenses in excess of $35,000 (the “Cap”), it being understood
that the Cap does not include legal expenses of the Agent’s counsel incurred
after the Final Closing in connection with the anticipated resale registration
of the securities issued in the Offering. The Corporation acknowledges and
agrees that the Cap has been set based on the parties’ joint expectation of the
amount of work involved to complete the Offering (based on, for example, an
existing set of negotiated documents for an earlier financing for the
Corporation in which the Agent participated), and the Corporation further
acknowledges and agrees that in the event of unforeseen circumstances or delay
in closing the Offering resulting in the greater than anticipated workload
for
the Agent’s legal counsel, such counsel’s reasonable fees and expenses in excess
of the Cap shall also be paid by the Corporation. Expenses incurred up to each
Closing Date shall be reimbursed, upon submission to the Corporation of
invoices, receipts or similar proof of expenditure, at the Closing Time for
such
Closing Date and may be deducted by the Agent from the proceeds of sale of
the
Shares at such Closing. Expenses incurred after the Final Closing Date shall
be
reimbursed, upon submission to the Corporation of invoices, receipts or similar
proof of expenditure, forthwith following the delivery to the Corporation of
accounts in respect thereof.
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9.
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Indemnification
|
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(a)
|
The
Corporation agrees to indemnify and hold harmless the Agent and its
respective directors, officers, shareholders, employees and agents
from
and against any and all losses, claims, damages, expenses and liabilities
(collectively, “Losses”) arising out of, in relation to or in connection
with (i) any breach or non-compliance by the Corporation of or with
any of
its covenants or representations and warranties herein, or (ii) the
services provided by the Agent hereunder, except to the extent that
any
Losses result from the Agent’s negligence, recklessness or bad faith in
performing such services or from the making by the Agent of any
unauthorized representations with respect to the Corporation. This
indemnity shall survive any termination of this
Agreement.
|
|
(b)
|
In
case any proceeding (including any governmental investigation) shall
be
instituted involving any indemnified party in respect of which indemnity
may be sought pursuant to the preceding paragraph, such party shall
promptly notify the Corporation in writing, and the Corporation,
upon the
request of such party, shall retain counsel reasonably satisfactory
to
such party to represent such party and any others the Corporation
may
designate in such proceeding and shall pay the fees and expenses
of such
counsel related to such proceeding.
|
10
|
(c)
|
In
any such proceeding, such indemnified party shall have the right
to retain
its own counsel, but the fees and expenses of such counsel shall
be at the
expense of such party unless (i) the Corporation and such party shall
have
mutually agreed to the retention of such counsel or (ii) the named
parties
to any such proceeding (including any impleaded parties) include
the
Corporation and such party and representation of both parties by
the same
counsel is not appropriate as a result of differing interests between
them. The Corporation shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with
such
consent or if there be a final judgment or determination in respect
of
which the indemnity referred to in this Section 9 is claimed, the
Corporation agrees to indemnify such party from and against any loss
or
liability by reason of such settlement, judgment or
determination.
|
|
10.
|
Notices,
etc.
|
All
notices hereunder may be hand delivered or given by facsimile or any other
means
of instantaneous written communication to such respective party hereto as
follows (or at such other address as may hereafter be communicated by either
party hereto to the other party):
If
to the
Agent:
Xxxxx
Capital Limited
00
Xxxxxxxxxx
Xxxxxx
X0X 0XX
Xxxxxxx
Attention: Xxxxx
Xxxxxx
Telephone: 00-00-0000-0000
Facsimile: 00-00-0000-0000
With
a
copy to:
Blake,
Xxxxxxx & Xxxxxxx LLP
000
Xxx
Xxxxxx, Xxxxxxxx Court West
Toronto,
ON X0X 0X0
Xxxxxx
Attention: Xxxx
X.
Xxxxxx
Telephone: (000)
000-0000
Facsimile: (000)
000-0000
11
If
to the
Corporation:
200
Middlesex Essex Turnpike, Suite 000
Xxxxxx,
Xxx Xxxxxx 00000
Xxxxxx
Xxxxxx
Attention: Xxxxxx
X.
Xxxxxx
President
and Chief Executive Officer
Telephone: 000-000-0000
Facsimile: 000-000-0000
With
a
copy to:
Xxxxxxxxx,
Xxxxxx & Xxxx LLP
00Xxxx
00xx
Xxxxxx,
00xx
Xxxxx
Xxx
Xxxx,
XX 00000
Attention: Xxxxx
Xxxxxxxxx
Telephone: 000-000-0000
xxx 000
Facsimile: 000-000-0000
|
11.
|
Counterparts
|
This
Agreement may be signed and delivered in counterparts, and by facsimile, with
the same effect as if the signatures thereto and hereto were upon the same
instrument and delivered in person.
|
12.
|
Survival
|
All
representations, covenants, undertakings and indemnities herein will survive
for
a period of two years following each and every Closing Date, notwithstanding
the
completion of the transactions contemplated hereby and shall apply regardless
of
any investigation made by or on behalf of any indemnified party.
|
13.
|
Governing
Law
|
This
Agreement shall be governed by and construed in accordance with the laws of
England and Wales.
|
14.
|
Time
|
Time
is
of the essence in this Agreement.
12
|
15.
|
Entire
Agreement
|
This
Agreement constitutes the entire agreement between the parties pertaining to
the
subject matter of this Agreement and supersedes all prior agreements,
understandings, negotiations and discussions, whether oral or written. There
are
no conditions, warranties, representations or other agreements between the
parties in connection with the subject matter of this Agreement (whether oral
or
written, express or implied, statutory or otherwise) except as specifically
set
out in this Agreement.
|
16.
|
Miscellaneous
|
This
Agreement shall enure to the benefit of, and be binding upon, the successors
of
the Corporation and the Agent.
|
Yours
sincerely,
XXXXX
CAPITAL LIMITED
|
||
| |
|
|
| By: | /s/ Xxxxxx Xxxxxx | |
|
Xxxxxx
Xxxxxx
|
||
| Director | ||
Accepted
and agreed as of the 14th day
of
August, 2007.
| By: |
/s/
Xxxxxx X. Xxxxxx
Xxxxxx
X. Xxxxxx
|
President
and Chief Executive Officer
13
Schedule
“A”
Restrictions
on Offers and Sales of the Shares
1. The
Agent
represents and agrees that: (i) it has not offered or sold and, prior to the
expiry of the period of six months after the Closing Date, will not offer or
sell any Shares to persons in the United Kingdom except to persons whose
ordinary activities involve them in acquiring, holding, managing or disposing
of
investments (as principal or agent) for the purposes of their businesses or
otherwise in circumstances which have not resulted and will not result in an
offer to the public in the United Kingdom within the meaning of the Public
Offers of Securities Regulations 1995, (ii) it has complied and will comply
with
all applicable provisions of the Financial Services Xxx 0000 with respect to
anything done by it in relation to the Shares in, from or otherwise involving
the United Kingdom, and (iii) it has only issued or passed on and will only
issue or pass on in the United Kingdom any document received by it in connection
with the issue of the Shares to a person who is of a kind described in Article
11(3) of the Financial Services Xxx 0000 (Investment Advertisements)
(Exemptions) Order 1995 or is a person to whom such document may otherwise
lawfully be issued or passed on; and (iv) it has complied and will comply with
all applicable securities laws in the United Kingdom and elsewhere in Europe
in
connection with the Offering.
2. The
Agent
acknowledges that the Shares including the shares of Common Stock issuable
upon
exercise of the Broker Warrant (collectively the “Securities”) have not been
registered under the 1933 Act and may not be offered or sold within the United
States or to, or for the account or benefit of, U.S. Persons (as defined in
Rule
902(o) of Regulation S promulgated under the Securities Act) except under an
effective registration statement under the Securities Act, in accordance with
Regulation S under the Securities Act or pursuant to an exemption from the
registration requirements of the Securities Act. Offers and sales will be made
in reliance on the exemption from registration provided by Section 4(2) of
the
Securities Act of 1933 and Rule 506 of Regulation D promulgated hereunder
and/or in reliance on Regulation S under the Securities Act of 1933, and the
Agent will comply with the provisions thereof in connection with the
Offering.
3. Terms
with initial capital letters used but not defined in this Schedule shall have
the meanings given to them in the Agency Agreement to which this Schedule is
attached.
Appendix
I
SUBSCRIPTION
AGREEMENT
