EXHIBIT 10.14
MARCH 30, 2004
ADVENTRX Pharmaceuticals, Inc.
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Attention: Xxxxxxxx Xxxxx, Chief Executive Officer
This letter agreement (this "Agreement") confirms the engagement of Xxxxxxx Xxxx
Partners ("BHP"), a division of Pali Capital, Inc., by ADVENTRX Pharmaceuticals,
Inc. (the "Company") to act as its exclusive placement agent solely in
connection with the anticipated private placement of approximately $5 million of
shares common stock (the "Shares") and warrants (the "Warrants") to purchase
shares of common stock of the Company (the "Financing").
As compensation for certain investment banking and placement services provided
by BHP to the Company in connection with the Financing, the Company shall pay to
BHP a cash fee equal to 8% of the gross proceeds received by the Company with
respect to the Financing from investors that purchase Shares in the Financing
(the "Investors"), provided, however, that in the event the Company receives
more than $5 million of gross proceeds in the Financing, the cash fee payable to
BHP with respect to such gross proceeds over $5 million shall be reduced to 5%.
In connection with the cash exercise of the Warrants, BHP shall receive a cash
fee equal to 4% percent of the gross proceeds received by the Company if and
when such Warrants are exercised for cash.
The Company shall issue to BHP or its designated assigns warrants to purchase a
number of shares of common stock of the Company equal to 8% percent of the
number of Shares (the "Placement Agent Warrants"). The Placement Agent Warrants
shall have an exercise price equal to the "A-1 Warrant referenced in the draft
subscription agreement to be executed in connection with the Financing, shall be
non-redeemable and shall have a cashless exercise provision.
The Company shall provide to BHP periodic reimbursement of all out-of-pocket
expenses, which amount shall not exceed $5,000 in the aggregate without the
prior written approval of the Company.
Notice given pursuant to any of the provisions of this Agreement shall be given
in writing and shall be sent by recognized overnight courier or personally
delivered (a) if to the Company, to the Company's address indicated in the
heading of this letter agreement (b) if to BHP, to its office at 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, XX 00000. Attention: Xxxxx Xxxxxxx, Managing Director.
No advice or opinion rendered by BHP, whether formal or informal, may be
disclosed, in whole or in part, or summarized, excerpted from or otherwise
referred to except as required by law or with BHP's prior written consent. In
addition, the Company shall not, without the prior written consent of BHP,
disclose the existence or terms of BHP's engagement pursuant to this Agreement
except as required by law or if such information is or becomes generally
available to the public. Since BHP will be acting on behalf of the Company in
connection with its engagement hereunder, the Company and BHP shall enter into a
separate letter agreement, in the form of Exhibit A attached hereto, dated the
date hereof, providing for the indemnification by the Company of BHP and certain
related persons and entities.
BHP's engagement hereunder shall expire 14 days from the date of this Agreement.
Notwithstanding the expiration of BHP's engagement, BHP shall be entitled to its
full fees provided for herein in the event that at any time prior to the first
anniversary of such expiration the Company consummates a private placement of
its securities with an Investor.
BHP shall indemnify and hold harmless the Company and its affiliates, the
respective directors, officers, agents and employees of the Company and its
affiliates (collectively, "Company Agents"), from and against, and BHP agrees
that no Company Agent shall have any liability to BHP or its directors,
officers, owners, partners, parents, affiliates, security holders or creditors
for, any losses, claims, damages or liabilities (including actions or
proceedings in respect thereof) (collectively "Losses") related to or arising
out of BHP's breach of this Agreement.
In connection with this engagement, BHP is acting as an independent contractor
with duties owing solely to the Company. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard to
conflicts of law principles thereof. This Agreement may not be amended or
modified except in writing signed by each of the parties hereto.
This Agreement and the attached indemnification agreement contain the entire
agreement of the parties with respect to the subject matter hereof and supersede
and take precedence over all prior agreements or understandings, whether oral or
written, between BHP and the Company. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provisions of this Agreement or the attached indemnification
agreement, which shall remain in full force and effect.
We are delighted to accept this engagement and look forward to working with you
on this assignment. Please confirm that the foregoing is in accordance with the
Company's understanding by signing and returning to us the enclosed duplicate of
this Agreement.
Very truly yours,
Xxxxxxx Hill Partners
By: /s/ Xxxxx Xxxxxxx
--------------------------
Xxxxx Xxxxxxx
Title: Managing Director
Accepted and Agreed to as of the date first written above:
Adventrx Pharmaceuticals, Inc.
By: /s/ Xxxxxxxx Xxxxx
---------------------------
Name: Xxxxxxxx Xxxxx
Title: Chief Executive Officer
EXHIBIT A
TO: Xxxxxxx Xxxx Partners
A division of Pali Capital Inc. Date: March 13, 2004
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
In connection with Xxxxxxx Hill Partners ("BHP" or "you") engagement by
ADVENTRX Pharmaceuticals, Inc. (the "Company" or "we") pursuant to the letter
agreement (the "Engagement Letter") of even date herewith (the "Engagement"), we
agree to indemnify and hold harmless BHP) and its affiliates, the respective
directors, officers, partners, agents and employees of BHP and its affiliates
(collectively, "Indemnified Persons"), from and against, and we agree that no
Indemnified Person shall have any liability to us or our owners, parents,
affiliates, security holders or creditors for, any losses, claims, damages or
liabilities (including actions or proceedings in respect thereof) (collectively
"Losses") (A) related to or arising out of (i) our actions or failures to act
(including statements or omissions made, or information provided, by us or our
agents), or (ii) actions or failures to act by an Indemnified Person with our
consent or in reliance on our actions or failures to act, or (B) otherwise
related to or arising out of the Engagement or your performance thereof, except
that this clause (B) shall not apply to any Losses to the extent that are
finally judicially determined or agreed to have resulted from BHP's or any
Indemnified Person's bad faith, recklessness or negligence or breach of this
agreement or the Engagement Letter. If such indemnification is for any reason
not available, we agree to contribute to the Losses involved in such proportion
as is judicially determined or agreed to be appropriate to reflect equitable
considerations such as the relative fault of us on the one hand and of you on
the other hand. Relative benefits to us, on the one hand, and you, on the other
hand, with respect to the Engagement shall be deemed to be in the same
proportion as (i) the total value paid or proposed to be paid or received or
proposed to be received by us or our security holders, as the case may be,
pursuant to the transaction(s), whether or not consummated, contemplated by the
Engagement bears to (ii) all fees paid or proposed to be paid to you by us in
connection with the Engagement.
We will reimburse each Indemnified Person for all expenses (including
reasonable fees and disbursements of counsel) as they are incurred by such
Indemnified Person in connection with investigating, preparing for or defending
any action, claim, investigation, inquiry, arbitration or other proceeding
("Action") with respect to any matter for which we would be obligated to
indemnify such Indemnified Person pursuant to the preceding paragraph, whether
or not in connection with pending or threatened litigation in which any
Indemnified Person is a party, and whether or not such Action is initiated or
brought by you, provided, however, that we will have no obligation to reimburse
any Indemnified Person for any expenses if our board of directors determines in
good faith that there is no bona fide basis that would obligate the Company to
indemnify such Indemnified Person for any Losses arising out of or related to
such Action. We further agree that we will not settle or compromise or consent
to the entry of any judgment in any pending or threatened Action in respect of
which we are obligated to indemnify an Indemnified Person (whether or not an
Indemnified Person is a party therein) unless we have given you reasonable prior
written notice thereof and used all reasonable efforts, after consultation with
you, to obtain an unconditional release of each Indemnified Person from all
liability arising therefrom.
In the event that we are called or subpoenaed to give testimony in a court
of law, you agree to pay our reasonable expenses related thereto. Our
obligations hereunder shall be in addition to any rights that any Indemnified
Person may have at common law or otherwise. Solely for the purpose of enforcing
this Agreement, we hereby consent to personal jurisdiction and to service and
venue in any court in which any claim which is subject to this Agreement is
brought by or against any Indemnified Person. We acknowledge that in connection
with the Engagement you are acting as an independent contractor with duties
owing solely to us. YOU HEREBY AGREE, AND WE HEREBY AGREE ON OUR OWN BEHALF AND,
TO THE EXTENT PERMITTED BY APPLICABLE LAW, ON BEHALF OF OUR SECURITY HOLDERS, TO
WAIVE ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY CLAIM, COUNTER-CLAIM OR
ACTION ARISING OUT OF THE ENGAGEMENT, YOUR PERFORMANCE THEREOF OR THIS
AGREEMENT.
The provisions of this agreement shall apply to the Engagement (including
related activities prior to the date hereof) and any modification thereof and
shall remain in full force and effect regardless of the completion or
termination of the Engagement. This agreement and any other agreements relating
to the Engagement shall be under seal, governed by and construed in accordance
with the laws of the state of New York, without regard to conflicts of law
principles thereof.
Very truly yours,
Accepted and Agreed:
Xxxxxxx Xxxx Partners Client: Adventrx Pharmaceuticals, Inc.
By: /s/ Xxxxx Xxxxxxx By: /s/ Xxxxxxxx Xxxxx
Xxxxx Xxxxxxx Xxxxxxxx Xxxxx
--------------------------- -----------------------------------
Name: Xxxxx Xxxxxxx Name: Xxxxxxxx XXxxx
Title: Managing Director Title: Chief Executive Officer
