Exhibit 10.10
Xxxxxxxxx Securities, Inc.
FINANCIAL CONSULTING AND INVESTMENT BANKING AGREEMENT
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THIS AGREEMENT is made as of this 30th day of June, 1999 by and between
Sunstar Healthcare, Inc., a Florida corporation having its principal office at
000 Xxxxxxxxxxxxx Xxxxxxx, Xxxxx 000, Xxxxxxxxx, XX 00000 (the "Company"), and
Xxxxxxxxx Securities, Inc, a Colorado corporation having an office at 0000
Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxx 00000 ("SSI").
Whereas, during the months of February and March of 1999, representatives
of the Company and SSI had discussions regarding the provisions of this
Agreement.
Now, Therefore, in consideration of the mutual premises contained herein
and on the terms and conditions hereinafter set forth, the Company and SSI agree
as follows:
1. PROVISION OF SERVICES. The Company hereby retains SSI to perform
non-exclusive consulting service related to corporate finance and investment
banking matters, and SSI hereby accepts such retention and shall undertake all
reasonable efforts to perform for the Company the duties described herein. In
this regard, SSI shall devote such time and attention to the business of the
Company as shall be determined by SSI, in its sole discretion.
(a) SSI agrees, to the extent reasonably requested by the Company, and
at the Company's written request to an officer in the Corporate Finance
department of SSI, to place at the disposal of the Company its judgment and
experience and to provide business development services to the Company including
the following:
(i) advice with regard to stockholder relations are public
relations matters, and
(ii) evaluation of financial matters and assistance in financial
arrangements and investment banking and/or transactions.
(b) Notwithstanding the foregoing, SSI may provide general services to
the Company in connection with mergers, acquisitions, consolidations, joint
ventures and similar corporate finance transactions; however, for each such
specific transaction or transactions, SSI and the Company may formalize their
arrangement in a separate agreement at the time specific service is provided.
(c) SSI shall use reasonable efforts in furnishing advice
recommendations, and for this purpose SSI shall at all times maintain or keep
and make available qualified personnel or a network of qualified outside
professionals for the performance of its obligation under this Agreement, at its
sole expense. To the extent reasonably practicable, SSI shall so use its own
personnel rather than outside professionals.
(d) The Company shall use reasonable efforts to invite a representative
appointed by SSI to attend and participate in at least one meeting of its Board
of Directors for every year that this Agreement is in effect. The Company shall
provide notice of such meetings to SSI at least one (1)
week prior to the date that the meeting is scheduled to occur. SSI will use its
reasonable efforts to attend any other meetings of the Company's Board of
Directors to which the Company requests SSI's attendance. Any reasonable
expenses incurred by SSI in attending such meetings shall be borne for by the
Company.
2. TERM. Unless otherwise provided for in this Agreement, SSI's intention
hereunder shall be for a term of two (2) years commencing on the date of this
Agreement and expiring on the second anniversary date of this Agreement (the
"Termination Date"). Except as provided for in paragraph 8 below, SSI may not
terminate this Agreement without the written consent of the Company prior to the
Termination Date. In the event that the Company desires to terminate this
Agreement, without "cause", prior to the Termination Date, it shall provide SSI
with at least thirty (30) days prior written notice of its intention to
terminate this Agreement and this Agreement shall terminate following the
expiration of this period, without any further responsibility for either party;
provided, however, that SSI shall be entitled to receive all compensation and
un-reimbursed expenses, if any, outstanding as of the date of termination,
unless such termination is for "cause" as determined by ?? court of competent
jurisdiction, in which case, the Warrant (as defined below) shall terminate as
to any un-exercised portion thereof.
3. COMPENSATION. In consideration for the services provided by SSI hereunder,
the Company shall:
(a) pay to SSI the sum of $50,000 as follows: $25,000 payable upon
the execution of this Agreement and the remaining $25,000 payable on the first
anniversary date of this Agreement; and
(b) issue to SSI a warrant (the "Warrant") to purchase up to 50,000
shares of the common stock of the Company (the "Underlying Common Stock") at a
per share price of $4.75, on substantially the same terms and conditions as
those set forth in the Warrant Agreement attached hereto as Schedule A.
4. REPRESENTATIONS AND WARRANTIES OF SSI. SSI represents and warrants that:
(a) it is a securities broker-dealer duly licensed and registered
pursuant to federal and state securities laws rules and regulations;
it has the authority and ability to provide the services contemplated in this
Agreement and this Agreement, and the performance by SSI hereunder, will not
violate any rules or laws or breach any agreement to which SSI is a party;
(c) it is a member in good standing with the NASD and is in good
standing with all states within which it is registered to conduct securities
business; and
(d) it is acquiring the Warrants for its own account for investment
and not with a view to the distribution thereof and that it will not sell,
transfer or otherwise dispose of the Warrants or the Underlying Common Stock
unless a registration statement is effective or counsel for SSI acceptable to
the Company opines that an exemption from such registration is available,
provided, however, that SSI may transfer its interests in the Warrants to
certain of its employees, officers and/or directors which it designates
provided further that such designees acquire the Warrants subject to the
parameters set forth in this subparagraph (d).
5. INDEMNIFICATION. The Company agree to indemnify and hold harmless SSI and
its affiliates, the respective directors, officers, partners, agents and
employees and such other person, if any,
controlling SSI or any of its affiliates (collectively the "SSI Parties") from
all losses, claims, damages, liabilities and expenses incurred by them hereunder
and only hereunder (including attorney's fees and disbursements) that result
from any violations of securities laws or rules or any untrue statements made or
any statements omitted to be made in connection with securities related matters
by the Company, its agents or employees. SSI will indemnify and hold harmless
the Company and the respective directors, officers, agents and employees of the
Company (the "Company Partners") from and against all losses, claims, damages,
liabilities and expenses that result from malfeasance, or gross negligence in
the performance of SSI's duties hereunder. Each person or entity seeking
indemnification hereunder shall promptly notify the Company, or SSI as
applicable, of any loss, claims, damage or expense for which the Company or SSI
as applicable, may become liable pursuant to this Section 5. Neither party shall
pay, settle or acknowledge liability under any such claim without the written
consent of the party liable for indemnification, and shall permit the Company or
SSI as applicable reasonable opportunity to cure any underlying problem or to
mitigate damages. The scope of this indemnification between SSI and the Company
shall be limited to, and pertain only to certain transactions contemplated or
entered into pursuant only to this Agreement.
The Company or SSI, as applicable, shall have the opportunity to demand any
claim for which it may be liable hereunder, provided it notifies the party
claiming the right to indemnification within fifteen (15) days of notice of the
claim.
6. STATUS OF SSI. SSI shall at all times be an independent contractor of the
Company and, except as expressly provided or authorized in this Agreement, shall
have no authority to act for or represent the Company or bind it to any
agreements.
7. OTHER ACTIVITIES OF SSI. The Company recognizes that SSI now renders and may
continue to render financial consulting, management, investment banking and
other services to other companies that may or may not conduct business and
activities similar to those of the Company. SSI shall be free to render such
advice and other services and the Company hereby consents thereto. SSI shall not
be required to devote its full time and attention to the performance of its
duties under this Agreement, but shall devote only so much of its time and
attention as it deems reasonable or necessary for such purposes, in its sole
discretion. Similarly, SSI recognizes that the Company's relationship with SSI
hereunder is not exclusive and that the Company currently has, or may have,
investment banking relationships with other firms.
8. COVENANTS OF THE COMPANY. The Company covenants, promises and agrees that:
(a) unless otherwise prohibited by contract or law, during the term of
this Agreement, the Company shall provide SSI at least fifteen (15) days prior
written notice of the proposed sale of any securities of the Company in a
"Regulation S" or "Regulation D" offering. Such notice shall specify the type of
securities to be offered, the purchase price thereof, the terms and conditions
of the offering and the proposed offering date. SSI shall be entitled to
immediately terminate this Agreement and retain all of the compensation set
forth herein without offset and with no further liability to the Company, in the
event that, during the term of this Agreement, the Company completes a sale of
its securities pursuant to a Regulation S offering, without SSI's prior written
consent thereto, which consent may not be unreasonably withheld;
(b) it shall immediately notify SSI in the event that it is deleted from
the NASDAQ Small Cap Market; and
(c) during the term of this Agreement, the Company shall furnish SSI
with copies of its annual, quarterly and proxy filings with the SEC, promptly
upon the Company's filing thereof.
9. CONTROL. Nothing contained herein shall be deemed to require the Company to
take any action contrary to its Certificate of Incorporation or By-Laws, or any
applicable statute or regulation, or to deprive its Board of Directors of their
responsibility for any control of the affairs of the Company.
10. PUBLIC DISCLOSURE REQUIREMENT. Within thirty (30) business days of the
final execution of this Agreement, the Company shall cause the release of a
public announcement which sets forth, in pertinent part, a brief and general
description of this Agreement, including without limitation, the name of SSI,
the nature of the services to be provided hereunder by SSI and the compensation
paid to it in connection herewith. At least three (3) business days prior to the
dissemination of any such public announcement or filing containing the above
required description, the Company shall submit to SSI, for its review and
comment, the proposed public announcement or description. SSI shall thereafter
have three (3) business days within which to submit its proposed editions or
amendments to the public announcement and or description for inclusion therein,
which editions and amendments may be incorporated in the final version
disseminated by the Company.
11. NOTICES. Any notices hereunder shall be sent to the Company and SSI at
their respective addresses above set forth. Any notice shall be given by
registered 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.
12. ADDITIONAL COMPENSATION. In the event that SSI introduces a candidate for
appointment to the Board of Directors of the Company, which candidate is
eventually nominated and appointed by the Company as a director, the Company
shall issue to SSI, as additional compensation, 25,000 shares of the Company's
common stock which shall be unregistered and which shall be locked up for a
period of eighteen (18) months following the date of such appointment.
13. ENTIRE AGREEMENT. This Agreement contains the entire agreement and
understanding between the parties with respect to its subject matter and
supersedes all prior discussion, agreements and understandings between them with
respect thereto. This Agreement may not be modified except in a writing signed
by the parties.
14. JURISDICTION AND VENUE. This Agreement has been made in the State of New
York and shall be governed by and construed in accordance with the laws thereof
without regard to principles of conflict of laws. Any proceeding commenced by
SSI to enforce or interpret any provision of this Agreement may be brought in
the City and County of New York, New York. The Company hereby submits to the
jurisdiction of the courts of the State of New York, including the federal
courts, for such purposes.
15. NO ASSIGNMENT. Neither this Agreement nor the rights of either party
hereunder shall be assigned by either party without the prior written consent of
the other party.
16. COUNTERPARTS. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute the one and the same instrument.
17. NON-COMPLIANCE. If any provision of this Agreement conflicts with any law,
rule or regulation of any federal, state or self-regulatory organization,
including the Securities and Exchange
Commission, the blue-sky laws of any state, the National Association of
Securities Dealers, Inc., or any other governmental authority having
jurisdiction over the activities or services described herein, then in that
event, such provision shall be deemed null and void.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed the day and year first above written.
Xxxxxxxxx Securities, Inc. Sunstar Healthcare, Inc.
/s/ Xxxxx X. Xxxx
________________________________ _________________________________
By: Xxxxx X. Xxxx By: Xxxxxx X. Xxxxxxx
Its: Senior Vice President Its: President
Corporate Finance
