ADVISORY AND INVESTMENT BANKING AGREEMENT
This Agreement is made and entered into as of the __ day of
____, 1997 by and between Maidstone Financial, Inc., a New York
corporation ("Maidstone"), and Univec, Inc., a New York corporation
(the "Company").
In consideration of the mutual promises made herein and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:
1. Purpose: The Company hereby engages Maidstone for the
term specified in Paragraph 2 hereof to render consulting advice to
the Company as an investment banker relating to financial and similar
matters upon the terms and conditions set forth herein.
2. Term: Except as otherwise specified in paragraph 4
hereof, this Agreement shall be effective from ____________________, 1997 to
_________________, 1999.
3. Duties of Maidstone: During the term of this Agreement,
Maidstone shall seek out Transactions (as hereinafter defined) on
behalf of the Company and shall furnish advice to the Company in
connection with any such Transactions.
4. Compensation: In consideration for the services rendered by
Maidstone to the Company pursuant to this Agreement (and in addition to the
expenses provided for in Paragraph 5 hereof), the Company shall compensate
Maidstone as follows:
(a) The Company shall pay Maidstone a fee of $4,000 per
month during the term of this Agreement. The sum of $96,000 shall be payable in
full on the date of this Agreement;
(b) In the event that any Transaction (as hereinafter
defined) occurs during the term of this Agreement or one year thereafter, the
Company shall pay fees to Maidstone as follows:
Consideration Fee
------------- ---
$ - 0 - to $ 500,000 Minimum fee of $25,000
$ 500,000 to $5,000,000 5% of Consideration
$5,000,000 or more $250,000 plus 1% of the
Consideration in excess of
$5,000,000
For the purposes of this Agreement, "Consideration" shall mean
the total market value on the day of the closing of stock, cash, assets and all
other property (real or personal) exchanged or received, directly or indirectly
by the Company or any of its security holders in connection with any
Transaction. Any co-broker retained by Maidstone shall be paid by Maidstone.
For the purposes of the Agreement, a "Transaction" shall mean
(a) any transaction originated by Maidstone, other than in the ordinary course
of trade or business of the Company, whereby, directly or indirectly, control of
or a material interest in the Company or any of its businesses or any of their
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respective assets, is transferred for Consideration, (b) any transaction
originated by Maidstone whereby the Company acquires any other company or the
assets of any other company or an interest in any other company (an
"Acquisition") or (c) any sale or Acquisition in connection with which the
Company engages an investment banker other than Maidstone and pays such
investment banker a fee in respect of such Transaction.
In the event Maidstone originates a line of credit with a
lender, the Company and Maidstone will mutually agree on a satisfactory fee and
the terms of payment of such fee; provided, however, that in the event the
Company is introduced to a corporate partner by Maidstone in connection with a
merger, acquisition or financing and a credit line develops directly as a result
of the introduction, the appropriate fee shall be the amount set forth in the
schedule above. In the event Maidstone introduces the Company to a joint venture
partner or customer and sales develop as a result of the introduction, the
Company agrees to pay a fee of five percent (5%) of total sales generated
directly from this introduction during the first two years following the date of
the first sale. Total sales shall mean cash receipts less any applicable
refunds, returns, allowances, credits and shipping charges and monies paid by
the Company by way of settlement or judgment arising out of claims made by or
threatened against the Company. Commission payments shall be paid on the 15th
day of each month following the receipt of customers' payment. In the event any
adjustments are made to the total sales after the commission has been paid, the
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Company shall be entitled to an appropriate refund or credit against future
payments under this Agreement. All fees to be paid pursuant to this Agreement,
except as otherwise specified, are due and payable to Maidstone in cash at the
closing or closings of any transaction specified in Paragraph 4 hereof. In the
event that this Agreement shall not be renewed or if terminated for any reason,
notwithstanding any such non-renewal or termination, Maidstone shall be entitled
to a full fee as provided under Paragraphs 4 and 5 hereof, for any transaction
for which the discussions were initiated during the term of this Agreement and
which is consummated within a period of twelve months after non-renewal or
termination of this Agreement.
5. Expenses of Maidstone: In addition to the fees payable
hereunder, and regardless of whether any transaction set forth in Paragraph 4
hereof is proposed or consummated the Company shall reimburse Maidstone for all
fees and disbursements of Maidstone's counsel and Maidstone's travel and
out-of-pocket expenses incurred in connection with the services performed by
Maidstone pursuant to this Agreement, including without limitation, hotels, food
and associated expenses and long-distance telephone calls.
6. Liability of Maidstone:
(1) The Company acknowledges that all opinions and advice
(written or oral) given by Maidstone to the Company in connection with
Maidstone's engagement are intended solely for the benefit and use of the
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Company in considering the transaction to which they relate, and the Company
agrees that no person or entity other than the Company shall be entitled to make
use of or rely upon the advice of Maidstone to be given hereunder, and no such
opinion or advice shall be used for any other purpose or reproduced,
disseminated, quoted or referred to at any time, in any manner or for any
purpose, nor may the Company make any public references to Maidstone, or use
Maidstone's name in any annual reports or any other reports or releases of the
Company without Maidstone's prior written consent.
(2) The Company acknowledges that Maidstone makes no
commitment whatsoever as to making a market in the Company's securities or to
recommending or advising its clients to purchase the Company's securities.
Research reports or corporate finance reports that may be prepared by Maidstone
will, when and if prepared, be done solely on the merits or judgment of analysis
of Maidstone or any senior corporate finance personnel of Maidstone.
7. Maidstone's Services to Others: The Company acknowledges
that Maidstone's or its affiliates are in the business of providing financial
services and consulting advice to others. Nothing herein contained shall be
construed to limit or restrict Maidstone in conducting such business with
respect to others, or in rendering such advice to others.
8. Company Information:
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(a) The Company recognizes and confirms that, in advising
the Company and in fulfilling its engagement hereunder, Maidstone will use and
rely on data, material and other information furnished to Maidstone by the
Company. The Company acknowledges and agrees that in performing its services
under this engagement, Maidstone may rely upon the data, material and other
information supplied by the Company without independently verifying the
accuracy, completeness or veracity of same.
(b) Except as contemplated by the terms hereof or as
required by applicable law, Maidstone shall keep confidential all material
non-public information provided to it by the Company, and shall not disclose
such information to any third party, other than such of its employees and
advisors as Maidstone determines to have a need to know.
9. Indemnification:
a. The Company shall indemnify and hold Maidstone harmless
against any and all liabilities, claims, lawsuits, including any and all awards
and/or judgments to which it may become subject under the Securities Act of
1933, as amended (the "1933 Act"), the Securities Exchange Act of 1934, as
amended (the "Act") or any other federal or state statute, at common law or
otherwise, insofar as said liabilities, claims and lawsuits (including awards
and/or judgments) arise out of or are in connection with the services rendered
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by Maidstone or any transactions in connection with this Agreement, except for
any liabilities, claims and lawsuits (including awards and/or judgments),
arising out of acts or omissions of Maidstone. In addition, the Company shall
also indemnify and hold Maidstone harmless against any and all costs and
expenses, including reasonable counsel fees, incurred or relating to the
foregoing.
Maidstone shall give the Company prompt notice of any such
liability, claim or lawsuit which Maidstone contends is the subject matter of
the Company's indemnification and the Company thereupon shall be granted the
right to take any and all necessary and proper action, at its sole cost and
expense, with respect to such liability, claim and lawsuit, including the right
to settle, compromise and dispose of such liability, claim or lawsuit, excepting
therefrom any and all proceedings or hearings before any regulatory bodies
and/or authorities.
Maidstone shall indemnify and hold the Company harmless
against any and all liabilities, claims and lawsuits, including any and all
awards and/or judgments to which it may become subject under the 1933 Act, the
Act or any other federal or state statute, at common law or otherwise, insofar
as said liabilities, claims and lawsuits (including awards and/or judgments)
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact required to be stated or necessary to make the statement
therein, not misleading, which statement or omission was made in reliance upon
information furnished in writing to the Company by or on behalf of Maidstone for
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inclusion in any registration statement or prospectus or any amendment or
supplement thereto in connection with any transaction to which this Agreement
applies. In addition, Maidstone shall also indemnify and hold the Company
harmless against any and all costs and expenses, including reasonable counsel
fees, incurred or relating to the foregoing.
The Company shall give to Maidstone prompt notice of any
such liability, claim or lawsuit which the Company contends is the subject
matter of Maidstone's indemnification and Maidstone thereupon shall be granted
the right to a take any and all necessary and proper action, at its sole cost
and expense, with respect to such liability, claim and lawsuit, including the
right to settle, compromise or dispose of such liability, claim or lawsuit,
excepting therefrom any and all proceedings or hearings before any regulatory
bodies and/or authorities.
b. In order to provide for just and equitable contribution
under the Act in any case in which (i) any person entitled to indemnification
under this Section 9 makes claim for indemnification pursuant hereto but it is
judicially determined (by the entry of a final judgment or decree by a court of
competent jurisdiction and the expiration of time to appeal or the denial of the
last right of appeal) that such indemnification may not be enforced in such case
notwithstanding the fact that this Section 10 provides for indemnification in
such case, or (ii) contribution under the Act may be required on the part of any
such person in circumstances for which indemnification is provided under this
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Section 10, then, and in each such case, the Company and Maidstone shall
contribute to the aggregate losses, claims, damages or liabilities to which they
may be subject (after any contribution from others) in such proportion taking
into consideration the relative benefits received by each party from the
offering covered by the prospectus with respect to any transactions in
connection with this Agreement (taking into account the portion of the proceeds
of the offering realized by each), the parties' relative knowledge and access to
information concerning the matter with respect to which the claim was assessed,
the opportunity to correct and prevent any statement or omission and other
equitable considerations appropriate under the circumstances; provided, however,
that notwithstanding the above in no event shall Maidstone be required to
contribute any amount in excess of 10% of the public offering price of any
securities to which such Prospectus applies; and provided, that, in any such
case, no person guilty of a fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation.
Within fifteen (15) days after receipt by any party to this
Agreement (or its representative) of notice of the commencement of any action,
suit or proceeding, such party will, if a claim for contribution in respect
thereof is to be made against another party (the "Contributing Party"), notify
the Contributing Party of the commencement thereof, but the omission so to
notify the Contributing Party will not relieve it from any liability which it
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may have to any other party other than for contribution hereunder. In case any
such action, suit or proceeding is brought against any party, and such party
notifies a Contributing Party or his or its representative of the commencement
thereof within the aforesaid fifteen (15) days, the Contributing Party will be
entitled to participate therein with the notifying party and any other
Contributing Party similarly notified. Any such Contributing Party shall not be
liable to any party seeking contribution on account of any settlement of any
claim, action or proceeding effected by such party seeking contribution without
the written consent of the Contributing Party. The indemnification provisions
contained in this Section 10 are in addition to any other rights or remedies
which either party hereto may have with respect to the other or hereunder.
10. Maidstone an Independent Contractor : Maidstone shall
perform its services hereunder as an independent contractor and not as an
employee of the Company or an affiliate thereof. It is expressly understood and
agreed to by the parties hereto that Maidstone shall have no authority to act
for, represent or bind the Company or any affiliate thereof in any manner,
except as may be agreed to expressly by the Company in writing from time to
time.
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11. Miscellaneous:
(1) This Agreement between the Company and Maidstone
constitutes the entire agreement and understanding of the parties hereto, and
supersedes any and all previous agreements and understandings, whether oral or
written, between the parties with respect to the matters set forth herein.
(2) Any notice or communication permitted or required
hereunder shall be in writing and shall be deemed sufficiently given if
hand-delivered or sent (i) postage prepaid by registered mail, return receipt
requested, or (ii) by facsimile, to the respective parties as set forth below,
or to such other address as either party may notify the other in writing:
If to the Company, to: Univec, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxx Xxxx, Xxx Xxxx 00000
with a copy to: Xxxx Xxxxxx
Snow Xxxxxx Xxxxxx P.C.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
If to Maidstone, to: Maidstone Group Inc.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
with a copy to: XXX X. XXXXXXXXX
Xxxxxxx, Savage, Kaplowitz,
Xxxxxxxxxx & Xxxxxx, LLP
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(3) This Agreement shall be binding upon and inure to the
benefit of each of the parties hereto and their respective successors, legal
representatives and assigns.
(4) This Agreement may be executed in any number of
counterparts, each of which together shall constitute one and the same original
document.
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(5) No provision of this Agreement may be amended, modified
or waived, except in a writing signed by all of the parties hereto.
(6) This Agreement shall be construed in accordance
with and governed by the laws of the State of New York, without giving effect to
conflict of law principles. The parties hereby agree that any dispute which may
arise between them arising out of or in connection with this Agreement shall be
adjudicated before a court located in New York City, and they hereby submit to
the exclusive jurisdiction of the courts of the State of New York located in New
York, New York and of the federal courts in the Southern District of New York
with respect to any action or legal proceeding commenced by any party, and
irrevocably waive any objection they now or hereafter may have respecting the
venue of any such action or proceeding brought in such a court or respecting the
fact that such court is an inconvenient forum, relating to or arising out of
this Agreement, and consent to the service of process in any such action or
legal proceeding by means of registered or certified mail, return receipt
requested, in care of the address set forth in Paragraph 11(b) hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, as of the day and year first above written.
MAIDSTONE FINANCIAL, INC.
By:________________________________
UNIVEC, INC.
By:________________________________
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