EXHIBIT 10.7
[LETTERHEAD OF ATLAS CAPITAL SERVICES, INC.]
June 20, 2001
By Xxxxxxxxx (000) 000-0000
Xx. Xxxxxx X. Xxxx
Chief Financial Officer
Small Town Radio
00000 Xxxxxxxxx Xxxx., Xxxxx 000
Xxxxxxxxxx, XX 00000
Re: Finder Agreement
Dear Xx. Xxxx:
This letter confirms the agreement ("Agreement") between Worldwide
PetroMoly Inc. (OTCBB:MOLY) d/b/a Small Town Radio Inc. (STRI), Inc. and its
affiliated companies (the "Company") to retail Atlas Capital Services, Inc.
("Atlas"), a registered broker-dealer and member of the NASD to provide the
services described below.
1. Services
1.1 Atlas shall use its reasonable best efforts to introduce the Company
to corporations, partnerships mutual funds, hedge funds, accredited investors,
investment partnerships, securities firms, lending and other institutions and
entities (collectively "Entities") which may engage in or provide a Transaction"
(as defined below) to the Company. As used herein, the term "Entities" also
means and includes any party, which is directly or indirectly connected with or
related to one of the Entities described above including, without limitation,
all affiliates as well as any referral from any of the Entities, any client or
customer or any of the Entities, and any investor in any of the Entities.
1.2 Except as set forth below, all services provided by Atlas under this
Agreement shall be at Atlas's cost and risk. Atlas's sole compensation, if any,
shall be a "Transaction Fee" (as set forth in Section 4 below) upon consummation
of a Transaction in any form with any Entity.
1.3 The Company acknowledges that Xxxxx's responsibilities shall be
limited to the foregoing, and that Atlas (i) shall not have authority to offer
or sell the Securities to any potential Entity, (ii) shall have no
responsibility to participate or assist in any negotiations between any
potential Entity and the Company, and (iv) shall have no responsibility for
fulfilling any reporting or filing requirements of the Company pursuant to
applicable federal and state securities laws. In addition, the Company expressly
acknowledges and agrees that Xxxxx's obligations hereunder are on a reasonable
best effort basis only and that the execution of this Agreement does not
constitute a commitment by Atlas to purchase the Securities or any other
securities of the Company and does not ensure the successful placement of the
Securities or any portion thereof.
1.4 Notwithstanding anything in this Agreement to the contrary, the
Company shall have the sole and absolute discretion to accept or not accept the
terms of any Transaction. Neither the Company nor any of its affiliates shall
have any liability whatsoever to Atlas or any other person or entity resulting
from its decision not to enter into a proposed Transaction, regardless of the
terms of the proposed Transaction.
2. Term
This Agreement shall take effect immediately and shall continue for a
minimum term of six (6) months. Thereafter, the Agreement will remain in effect
until terminated by either party upon 30 days prior written notice to the other.
3. Information
In connection with Xxxxx's engagement hereunder, the Company will
furnish Atlas and any prospective Entity with any information concerning the
Company that Atlas reasonably deems appropriate and will provide Atlas and
prospective Entities with reasonable access to the Company's officers,
directors, accountants, counsel and other advisors, subject to the Company's
non-disclosure agreement. In addition, Atlas shall be kept fully informed of any
events that are reasonably likely to have a material effect on the financial
condition of the Company. The Company represents and warrants to Atlas that all
such information concerning the Company and all private placement materials,
whether in the form of a letter, circulated, memorandum, notice or otherwise to
be used in placing the securities, to the extent that the Securities are placed
in a private placement, or an appropriate subscription agreement, to the extent
that the securities to be placed have been publicly registered ("Materials")
will be true and accurate in all material respects and will not contain any
untrue statement of a 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 such statements are made. The Company acknowledges and
agrees that Xxxxx will not undertake any "due diligence" investigation and will
be using and relying upon the information supplied by the Company and its
officers, agents and others, the Materials, and any other publicly available
information concerning the Company.
4. Transaction Fee
In consideration of Xxxxx's services, Atlas shall be entitled to
receive, and the Company hereby agrees to pay to Atlas, the following:
4.1 Atlas shall receive a Transaction Fee payable by certified check or
wire transfer equal to 10% of the principal amount of the Transaction Amount (as
defined below, and shall be paid as proceeds are received by the Company from
each Transaction; provided however, if the Transaction is in the form of an
equity line of credit, Atlas shall receive a Transaction Fee equal to 3% of the
amount of the money the Company draws down on the equity line. Any portion of
Atlas's Transaction Fee that is attributable to proceeds to be received by the
Company upon the occurrence of a future event, or the satisfaction of a
contingency shall be paid when the event occurs or the contingency is satisfied.
4.2 In addition to the foregoing, upon consummation of a Transaction, the
Company will issue to Atlas and/or its designee(s) warrants (the "Warrants") to
purchase such number of shares of the Company's common stock as shall be equal
to 3% of the aggregate number of fully diluted and/or exercised or converted
shares of common stock of the Company as are purchased by the Entities. The
Warrants shall be exercisable for a period of five years from the date of
closing with an exercise price equal to the effective per share or unit price
paid by the Entities engaging in the Transaction. The terms of the Warrants
shall be set forth in one or more agreements (the "Warrant Agreements") in form
and substance reasonable satisfactory to Atlas and the Company. The Warrant
Agreements shall contain customary terms, including without limitation,
provisions for change of control, weighted-average price based anti-dilution,
and customary demand and piggyback registration rights consistent with the
registration rights granted to the Entities.
4.3 Atlas's Transaction Fee shall have been earned and shall be payable
to Atlas upon consummation of any Transaction which occurs as a result of this
Agreement with any Entity in which a Transaction was made in whole or in part
(1) during the term of this Agreement (hereafter "Phase I"); or, (2) within 24
months following the termination date of this Agreement (hereafter "Phase II")
with regard to an Entity which Atlas or the Company has had any communications
during Phase I.
4.4 As used herein, the term "Transaction Amount" shall mean the gross
amount of all consideration, including without limitation to, all cash, cash
equivalents, stock, warrants, and/or assets that is exchanged or provided to or
by the Company or its shareholders, affiliates, or subsidiaries in a
Transaction, or any entities formed in or which results from a Transaction. The
Transaction amount shall be cumulative (e.g., if the Company receives initial
consideration and then subsequently received royalty an/or licensing fees,
warrant exercise funds, etc.), such that the Transaction Amount shall include
all such consideration.
5. Transaction
5.1 As used herein, the term "Transaction" means any business agreement,
arrangement or transaction or series or combinations thereof which may include
sales or exchanges of stock, warrants, or assets, or the making of loans, leases
and other arrangements of every type and description, by which, directly or
indirectly, an interest in the Company, its affiliates, or any business with
common management with the Company, or any of their respective assets, capital
stock or other securities is transferred to another Entity, including, without
limitation, by way of or in the form of, a merger, acquisition, sale or exchange
of stock or assets, lease of assets, with or without purchase option, joint
venture, licensing arrangements, minority investment or partnership.
5.2 As used herein, the term "Transaction" also means any business
agreement, arrangement or transaction or series or combinations thereof which
may include sales or exchanges of stock, warrants, or assets, or the making of
loans, leases and other arrangements of every type and description by which,
directly or indirectly, an interest in any Entity is transferred to the Company,
its affiliates, or any business with common management with the Company, or any
business with common management with the Company, or any of their respective
assets, capital stock or other securities, including, without limitation, by way
of and in the form of a merger, acquisition, sale or exchange of stock or
assets, lease of assets, with or without purchase option, joint venture,
licensing arrangements, minority investment or partnership.
6. Non-Circumvent
In order to prevent the Company from circumventing Atlas's position
with an Entity, the Company agrees that whether or not any Transaction
concerning the Company is completed, for a two-year period commencing from the
date of this Agreement, without the prior express written consent of Atlas,
neither the Company nor any of its officers, employees, or agents will (a)
contact directly or indirectly any person or Entity introduced to the Company by
Atlas during the term of this Agreement; or (b) circumvent Atlas's position with
respect to the Company or Entity in any manner whatsoever.
7. Non-Exclusive
Each party acknowledges and agrees that the rights granted to the other
in this Agreement are non-exclusive, and that, without limiting the generality
of the foregoing, nothing in this Agreement shall be deemed or construed to
prohibit either party herein from participating in similar business arrangements
as those described herein.
8. Indemnification
The Company shall indemnify Atlas under its standard indemnification
provisions attached hereto as Schedule A and made a part hereof.
9. General Provisions
9.1 Any and all claims, disputes, or controversies arising out of this
Agreement will be resolved by arbitration before the American Arbitration
Association ("AAA") and that with respect to the Agreement, a party may seek
injunctive relief and ancillary damages before the AAA. Each party irrevocably
consents to subject matter jurisdiction before the AAA. The parties shall
restrict themselves to claims for compensatory damages and no claims shall be
made by any party for punitive or similar damages. The parties agree that any
award or decision by the AAA shall be final and binding upon the parties and a
judgment may be entered in a court of competent jurisdiction upon such award or
decision. The parties agree that the situs of any arbitration or legal
proceedings hereunder shall be the City of New York.
9.2 This Agreement may not be amended or modified except in writing signed
by both parties to the Agreement.
9.3 All notices and other communications hereunder shall be deemed given
upon (a) the sender's confirmation of receipt of a facsimile transmission to the
recipient's facsimile number set forth below, (b) confirmed delivery by a
standard overnight carrier to the recipient's address set forth below, or (c)
delivery by hand to the recipient's address set forth below (or, in each case,
to or at such other facsimile number or address for a party as such party may
specify by notice given in accordance with this Section 9.3):
(a) If to the Company, to:
Xxxxxx X. Xxxx
Chief Financial Officer
Small Town Radio
00000 Xxxxxxxxx Xxxx., Xxxxx 000
Xxxxxxxxxx, XX 00000
Fax: (000) 000-0000
(b) If to Atlas, to:
Xxxxxx Xxxxxx
Managing Director
Atlas Capital Services, Inc.
000 Xxxxxxxx, Xxxxx 000
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
9.4 Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors and assigns.
9.5 Atlas 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 Atlas 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.
9.6 The Company hereby represents that it is a sophisticated business
enterprise that has retained Atlas for the limited purposes set forth in this
letter, and the parties acknowledge and agree that their respective rights and
obligations are contractual in nature. Each party disclaims an intention to
impose fiduciary obligations on the other by virtue of the engagement
contemplated by this letter.
If the foregoing is acceptable to you, please sign and return the
enclosed copy of this letter to my attention.
Very truly yours,
ATLAS CAPITAL SERVICES, INC.
By: /S/ Xxxxxx Xxxxxx
______________________________
Name: Xxxxxx Xxxxxx
Title: Managing Director
AGREED AND ACCEPTED:
WORLDWIDE PETROMOLY, INC. &
SMALL TOWN RADIO, INC.
By: /s/ Xxxxxx X. Xxxx
___________________________
Name: Xxxxxx X. Xxxx
Title: Chief Financial Officer
Date: 6-22-01
_________________________
Schedule A
Atlas Capital Services, Inc.
000 Xxxxxxxx, Xxxxx 000
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
In connection with our engagement of Atlas Capital Services, Inc.
("Atlas") as a Finder, we hereby agree to indemnify and hold harmless Atlas and
its affiliates, and the respective directors, officers, shareholders, agents and
employees of Atlas (collectively the "Indemnified Persons"), from and against
any and all claims, actions, suits, proceedings (including those of
shareholders), damages, liabilities and expenses as incurred by any of them
(including the reasonable fees and expenses of counsel) which (A) relate to or
arise out of (i) any actions taken or omitted to be taken (including any untrue
statements made to any Indemnified Person in connection with our engagement of
Atlas, or (B) otherwise relate to or arise out of Atlas's activities on our
behalf under Xxxxx's engagement, including any action by Xxxxx to collect
amounts owed to it in connection therewith, and we shall reimburse any
Indemnified Person for all expenses (including the reasonable fees and expenses
of counsel) as incurred by such Indemnified Person in connection with
investigating, preparing or defending any such claim, action, suit or proceeding
(collectively, a "Claim"), in connection with pending or threatened litigation
in which any Indemnified Person is a party. We will not, however, be responsible
for any Claim which is finally judicially determined to have resulted
exclusively from the gross negligence or willful misconduct of any person
seeking indemnification hereunder. We further agree that no Indemnified Person
shall have any liability to us for or in connection with our engagement of Atlas
except for any Claim incurred by us solely as a direct result of any Indemnified
Person's gross negligence or willful misconduct.
We further agree that we will not, without the prior written consent of
Xxxxx, settle, compromise or consent to the entry of any judgment in any pending
or threatened Claim in respect of which indemnification may be reasonably sought
hereunder (whether or not any Indemnified Person is an actual or potential party
to such Claim), unless such settlement, compromise or consent includes an
unconditional, irrevocable release of each Indemnified Person against whom such
claim may be brought hereunder from any and all liability arising out of such
claim.
Promptly upon receipt by an Indemnified Person of notice of any
complaint or the assertion or institution of any Claim with respect to which
indemnification is being sought hereunder, such Indemnified Person shall notify
us in writing of such complaint or of such assertion or institution but failure
to do so notify us shall not relieve us from any obligations we may have
hereunder, unless and only to the extent such failure results in the forfeiture
by us of substantial rights and defenses, and will not in any event relieve us
from any other obligation or liability we may have to any Indemnified Person
and, we will assume the defense of such Claim, including the employment of
counsel reasonably satisfactory to such Indemnified Person and the payment of
reasonable fees and expenses of such counsel. In the event, however, that such
Indemnified Person reasonably determines that having common counsel with the
Company and/or another Indemnified Person would present such counsel with a
conflict of interest or if the defendant in, or target of, any such Claim,
includes an Indemnified Person and us, and such Indemnified reasonably concludes
that there may be legal defenses available to it or other Indemnified Persons
different from or in addition to those available to us, then such Indemnified
Person may employ its own separate counsel to represent or defend it in any such
Claim and we shall pay the reasonable fees and expenses of such counsel.
Notwithstanding anything herein to the contrary, if we fail timely or diligently
to defend, contest, or otherwise protect against any Claim, the relevant
Indemnified Person shall have the right, but not the obligation, to defend
contest, compromise, settle, assert crossclaims, or counterclaims or otherwise
protect against the same, and shall be fully indemnified by us therefore,
including without limitation, for the reasonable fees and expenses of its
counsel and all amounts paid as a result of such Claim or the compromise or
settlement thereof. In any Claim in which we assume the defense, the Indemnified
Person shall have the right to participate in such Claim and to retain its own
counsel therefore at its own expense.
We agree that if any indemnity sought by an Indemnified Person
hereunder is held by a court to be unavailable for any reason, then (whether or
not Atlas is the Indemnified Person), we and Atlas shall contribute to the Claim
for which such indemnity is held unavailable in such proportion as is
appropriate to reflect the relative benefits to us, on the one hand, and Atlas
on the other, in connection with Xxxxx's engagement referred to above, and the
relative fault, as between us and the Indemnified Person in respect of the
Claim, subject to the limitation that in no event shall the amount of Atlas's
contribution to such Claim exceed the amount of fees actually received by Xxxxx
from us pursuant to Atlas's engagement. We hereby agree that the relative
benefits to us, on the one hand, and Atlas on the other, with respect to Xxxxx's
engagement shall be deemed to be in the same proportion as (a) the total value
paid or proposed to be paid or received by us or our stockholders as the case
may be, pursuant to the transaction (whether or not consummated) for which you
are engaged to render services bears to (b) the fee actually paid to Atlas in
connection with such engagement; provided, however, that under no circumstances
whatsoever shall Atlas be required to contribute to any such claim any amount in
excess of the fee actually paid in connection with such engagement.
Our indemnity, reimbursement and contribution obligations under this
Agreement shall be in addition to, and shall in no way limit or otherwise
adversely affect, any rights that any Indemnified Party may have at law or at
equity.
Should Atlas or its personnel be required or requested by us to provide
documentary evidence or testimony in connection with any proceeding arising form
or relating to Xxxxx's engagement, we agree to pay all reasonable expenses
(including fees incurred for legal counsel) in complying therewith.
Any and all claims, disputes, or controversies arising out of this
Agreement will be resolved by arbitration before the American Arbitration
Association ("AAA") and that with respect to this Agreement, a party may seek
injunctive relief and ancillary damages before the AAA. Each party irrevocably
consents to subject matter jurisdiction before the AAA. The parties shall
restrict themselves to claims for compensatory damages and no claims shall be
made by any party for punitive or similar damages. The parties agree that any
award or decision by the AAA shall be final and binding upon the parties and a
judgement may be entered in a court of competent jurisdiction upon such award or
decision. The parties agree that the situs of any arbitration or legal
proceedings hereunder shall be the City of New York.
It is understood that, in connection with Xxxxx's engagement, Xxxxx may
be engaged to act in one or more additional capacities and that the terms of the
original engagement or any such additional engagement may be embodied in one or
more separate written agreements. The provisions of this Agreement shall apply
to the original engagement, any such additional engagement any and modifications
of the original engagement or such additional engagement and shall remain in
full force and effect following the completion or termination of Atlas's
engagement(s).
Very truly yours,
WORLDWIDE PETROMOLY, INC. &
SMALL TOWN RADIO, INC.
By: /s/ Xxxxxx X. Xxxx
___________________________
Name: Xxxxxx X. Xxxx
Title: Chief Financial Officer
Confirmed and agreed to:
ATLAS CAPITAL SERVICES, INC.
By: /s/ Xxxxxx Xxxxxx
______________________________
Name: Xxxxxx Xxxxxx
Title: Managing Director
