EXHIBIT 10.7
TRIAD INNOVATIONS, INC./XXXXXXX & CO. AGREEMENT
XXXXXXX & CO.
STEMMONS PLACE
0000 XXXXXXXX XXXXXXX
XXXXX 0000
XXXXXX, XXXXX 00000
Xxxxxx X. Xxxxxxxx Telephone: (000) 000-0000
Fax: (000) 000-0000
June 10, 1999
PERSONAL AND CONFIDENTIAL
Xx. Xxxxx X. Xxxxxxx
Triad Innovations, Inc.
000 Xxxxx Xxxxxx Xxx Xxxx
Xxxxx 000 c-I 13
Xxxxxxx, Xxxxx 00000
RE: Triad Marketing and Equity Placement
Dear Xx. Xxxxxxx:
This agreement (the "Agreement") is entered into this 10th day of June
1999, BETWEEN TRIAD INNOVATIONS, INC. ("Triad") and Xxxxxxx & Co. ("Xxxxxxx")
which may be referred to individually as (the "Party") or collectively as ("The
Parties").
WHEREAS, TRIAD has developed centrifuge and compression technology (the
"Technology"); and
WHEREAS, TRIAD plans to market the Technology in various industries,
including the petroleum and chemical industries; and
WHEREAS, TRIAD requires a consulting firm to provide independent
verification of the Technology, oversee future development, and assist in the
marketing of the Technology; and
WHEREAS, Xxxxxxx is a consulting firm with knowledge of refineries
chemical plants, natural gas processing, etc. and has been involved in the
equity placement for a number of companies;
Now, therefore in consideration of the mutual promises herein contained
and other good and valuable considerations, The Parties hereby agree as follows:
Xx. Xxxxx X. Xxxxxxx
June 10, 1999
Page 2
SECTION 1. RELATIONSHIP AMONG PARTIES
Effective June 10, 1999 Xxxxxxx is retained by TRIAD to provide
engineering, consulting and marketing services as directed by TRIAD and to
provide introductions to potential investors.
SECTION 2. FOCUS OF RELATIONSHIP
The Parties will mutually cooperate to market the Technology to the
petroleum and chemical industries and to facilitate financing transactions with
TRIAD. Xxxxxxx will develop an information memorandum for TRIAD to be used in
obtaining additional funding. Xxxxxxx will review the work and contracts of
TRIAD and perform additional due diligence as necessary.
SECTION 3. TRIAD RESPONSIBILITIES
TRIAD will provide Xxxxxxx with full disclosure of the patents, working
documents, preliminary business plans, contracts, etc, necessary for Xxxxxxx to
prepare the Information Memorandum. TRIAD will also perform the following
functions:
* Continue to develop the Technology and complete corresponding patent
applications
* Fund engineering required for Technology development
* Provide legal assistance necessary to structure and complete any
agreements
* Participate in the negotiations with the selected equity investors
* Compensate Xxxxxxx in accordance with the terms of Section 6.
SECTION 4. XXXXXXX'X RESPONSIBILITIES
Xxxxxxx shall assist TRIAD as follows:
1) Provide verification of the Technology and technical services for
development of the Technology.
2) Develop an Information Memorandum as defined in Attachment A
Xx. Xxxxx X. Xxxxxxx
June 10, 1999
Page 3
3) Assist TRIAD with marketing of the Technology to petroleum and
chemical companies as designated by TRIAD management and assist in negotiating
contracts for marketing the Technology.
4) Establish contacts with investors according to procedures specified
in Section 5 and exclusively assist TRIAD in negotiations with Xxxxxxx Investors
(Investor Contacting").
For the purpose of this Agreement, the professional services related to
items 1), 2), and 3) above shall be referred to as "Base Services.' The
professional fees and expenses related to "Base Services" shall total $100,000.
The professional fees shall be determined based on modified hourly rates of $225
for all consultants and $110 for analysts. Expenses such as travel, lodging,
document reproduction, and telephone will be included at cost. Xxxxxxx will
provide TRIAD with an accounting of fees and expenses related to Base Services
on a monthly basis.
SECTION 5. INVESTOR CONTACTING
Xxxxxxx shall use its best efforts to solicit potential investors
exclusive of potential investors already identified by TRIAD ("TRIAD
INVESTORS"). TRIAD shall provide an initial list of TRIAD Investors. Xxxxxxx
shall follow the procedures below regarding contacts with potential investors
exclusive of TRIAD investors ("Xxxxxxx Investors").
1) Xxxxxxx shall provide TRIAD in writing the names of potential
investors Xxxxxxx wishes to approach, in advance of approaching such buyers. If
TRIAD does not want Xxxxxxx to approach a named investor, it shall notify
Xxxxxxx in writing within two business days and such potential investor shall
not be considered a Xxxxxxx Investor.
2) Xxxxxxx shall coordinate with TRIAD with respect to approaches or
presentations to and discussions with Xxxxxxx Investors.
3) Xxxxxxx shall keep TRIAD informed of all discussions with potential
investors.
Xx. Xxxxx X. Xxxxxxx
June 10, 1999
Page 4
SECTION 6. COMPENSATION
TRIAD shall compensate Xxxxxxx as follows:
1) For providing the base services, Xxxxxxx will receive common stock
in TRIAD equal to 300,000 shares of TRIAD publicly traded stock (OTC BB: TRDI).
The 300,000 shares of stock will be provided upon Xxxxxxx'x delivery of a draft
copy of the Information Memorandum.
The 300,000 shares of TRIAD stock shall be designated to the following
Xxxxxxx consultants:
Xxxxxx X. Xxxxxxxx 75,000 Shares
W. Xxx Xxxxxxx 75,000 Shares
Xxxxx X. Xxxxxxx 75,000 Shares
C. Xxxx Xxxxxxx 75,000 Shares
The Parties understand that the Xxxxxxx consultants will be restricted
from selling the stock for one year following receipt of such stock.
2) Each of the four Xxxxxxx consultants shall also receive in
conjunction with the shares issued in 1) above an option to purchase 75,000
additional shares of common stock (300,000 additional combined shares) at a
price of $2.00 per share with such option expiring on June 10, 2002. The option
price per share shall be adjusted for any stock splits.
3) For services related to Investor Contacting, Xxxxxxx shall earn a
Success Fee in an amount equal to 5.0 percent of the respective investment in
TRIAD received from any Xxxxxxx Investor. Any Success Fee is contingent upon and
will be payable at closing of the investment transaction. If there is a deferred
payment element to the investment, Xxxxxxx shall be paid on the same deferred
basis.
4) For any other assistance or services requested by TRIAD beyond
Xxxxxxx'x responsibilities specified in Section 4, TRIAD will compensate Xxxxxxx
by paying Xxxxxxx'x current hourly billing rate plus reimbursement of expenses.
Xxxxx X. Xxxxxxx
June 10,1999
Page 5
Xxxxxxx'x current hourly billing rate is $300 for Xxx Xxxxxxx, Xxxx
Xxxxxxx, and Xxxxx Xxxxxxx; $225 for other consultants; and $110 for analysts.
SECTION 7. TERM
The term of this Agreement shall be for one year. Should an investment
transaction be consummated by a Xxxxxxx Investor within two years of the
termination of this Agreement, Xxxxxxx shall be entitled to the net Success Fee
described above.
SECTION 8. CONFIDENTIALITY
TRIAD and Xxxxxxx acknowledge that during the term of this Agreement,
the Parties may obtain access to certain confidential and proprietary business
information of each Party and agree to maintain the confidentiality of such
information. To this end, Xxxxxxx previously signed a TRIAD specific
Confidentiality Agreement relative to the Technology. Upon termination of this
Agreement, any confidential or proprietary information in the possession of
either Party shall be returned to the appropriate Party.
The terms of the previously executed specific Confidentiality Agreement
shall not be superceded by this Agreement. Should any terms be in conflict, then
the Confidentiality Agreement shall govern.
SECTION 9. INDEMNIFICATION
TRIAD and Stencil mutually agree to indemnify, defend, and hold
harmless each Party from and against all damages, losses, liabilities,
obligations, costs and expenses, and any and all claims, demands or suits,
arising from or relating to each Party's performance during the operation of
this Agreement.
SECTION 10. GENERAL PROVISIONS
a) Law Governing. This Agreement shall be governed by and construed
in accordance with the laws of the State of Texas.
b) Notices. Any notices to be given hereunder by either Party to the
other shall be in writing and shall be given either by personal delivery or by
mail, registered or certified, postage prepaid, return receipt requested,
addressed to the other Party at the address set forth below the signature of
such Party, or at such other address as such Party may hereafter specify in
writing, in the manner provided herein.
Xx. Xxxxx X. Xxxxxxx
June 10, 1999
Page 6
C) ENTIRE AGREEMENT. This Agreement sets forth the entire understanding
of the Parties and supersedes all prior agreements or understandings, whether
written or oral, with respect to the subject matter hereof. No terms,
conditions, or warranties, other than those contained herein, and no amendments
or modifications hereto shall be binding unless made in writing and signed by
the Parties hereto.
D) BINDING EFFECT. This Agreement shall extend to and be binding upon
and inure to the benefit or the Parties hereto, their respective
representatives, successors, and permitted assigns. No Party may assign its
rights or obligations hereunder without the prior written consent of the other
Party hereto.
E) WAIVER. The waiver by either Party of a breach of any term of
provision of this Agreement shalt not operate or be construed as a waiver of any
subsequent breach of the same provision or of the breach of any other term or
provision of this Agreement.
F) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, TRIAD and Xxxxxxx have executed this Agreement as
of this 10th day of June 1999.
Very truly yours,
XXXXXXX & CO
/S/C. XXXX XXXXXXX
C. Xxxx Xxxxxxx, Vice President
/S/XXXXXX X. XXXXXXXX
Xxxxxx X. Xxxxxxxx, Vice President
Triad Innovations, Inc.
BY:/S/XXXXX X. XX XXXXX
Xxxxx X. Xxxxxxx
President
ATTACHMENT A
TRIAD MARKETING AND EQUITY PLACEMENT
INFORMATION MEMORANDUM
Xxxxxxx proposes to develop an Information Memorandum to assist Triad in funding
the development of the Technology. The Information Memorandum is envisaged to
address the following areas.
* Introduction
* Summary/Proposal to Equity Investors
* Description of Triad Centrifuge Separation Technology
* Assessment of Market Potential
* Potential Applications
* Technical and Economic Issues
* Potential Economic Value
* Triad Innovations Business Plan
* Separation Technology Marketing and Development Plan
* Development Budget
* Proposed Equity Financing
* Pro Forma
The Information Memorandum will focus primarily on the Triad's centrifuge
separation technology but may also describe Triad's compressor technology and
related development opportunity.
