M.H. MEYERSON & CO., INC.
FOUNDED 1960
BROKERS & DEALERS IN SECURITIES
UNDERWRITERS
A PUBLICLY TRADED COMPANY
NMS - NASDAQ MHMV
30 MONTGOMERY STREET o P.O. BOX 260 o JERSEY CITY, NJ 07303-0260
201-332-3353 o 212-425-1212 o 800-333-3113
FAX 201-332-1562
June 3, 1996
Mr. James Spartz
Director
SOLUCORP INDUSTRIES, LTD.
520 Victor Street
Saddle Brook, NJ 07663
RE: LETTER OF INTENT
Dear Mr. Spartz:
THIS AGREEMENT (the "Agreement") is made as of June 3, 1996 between
("SOLUCORP") and M.H. Meyerson & Co., Inc. ("MEYERSON") & Brookehill Equities,
Inc. ("BROOKEHILL") 545 Madison Avenue, New York, New York 10022.
In consideration of the mutual covenants contained herein and intending to
be legally bound thereby, SOLUCORP and MEYERSON/BROOKEHILL hereby agree as
follows:
1. MEYERSON/BROOKEHILL will perform investment banking services for SOLUCORP
on the terms set forth below for a period of five years from the date
hereof. Such services will be performed on a best efforts basis and will
include, without limitation, assistance to SOLUCORP in mergers,
acquisitions, and internal capital structuring and the placement of new
debt and equity issues of SOLUCORP, all with the objective of accomplishing
SOLUCORP's business and financial goals. In each instance,
MEYERSON/BROOKEHILL shall endeavor, subject to market conditions, to assist
SOLUCORP in identifying corporate candidates for mergers and acquisitions
and sources of private and institutional funds; to provide planning,
structuring, strategic and other advisory services to SOLUCORP; and to
assist in negotiations on behalf of SOLUCORP. MEYERSON/BROOKEHILL will have
the option to perform all financings to be done by SOLUCORP for as long as
this agreement is in effect. In each instance, MEYERSON/BROOKEHILL will
render such services as to which SOLUCORP and MEYERSON/BROOKEHILL mutually
agree and MEYERSON/BROOKEHILL will exert its best efforts to accomplish the
goals agreed to by MEYERSON/BROOKEHILL and SOLUCORP.
2. In connection with the performance of this AGREEMENT, MEYERSON/BROOKEHILL
and SOLUCORP shall comply with all applicable laws and regulations,
including, without limitation, those of the National Association of
Securities Dealers, Inc. and the Securities and Exchange Commission.
3. In consideration of the services previously rendered and to be rendered by
MEYERSON/BROOKEHILL hereunder, MEYERSON/BROOKEHILL is hereby granted
Warrants to purchase a total of 300,000 shares of Common Stock with an
exercise price of $7.50 per share with demand and piggy back registration
rights as provided in section 5 below. These Warrants shall vest and become
irrevocable upon the signing of this AGREEMENT. These Warrants and/or
Underlying shares may be sold anytime after 1 year and for a period of five
years from the date of this agreement.
4. If SOLUCORP should, at any time, or from time to time hereafter, effect a
stock split, a reverse stock split, or a recapitalization, the terms of the
Warrant shall be proportionately adjusted to prevent the dilution or
enlargement of the rights of the holders.
5. During the period from June 3, 1996 to June 3, 2001 the holders of at least
51% of the shares of SOLUCORP Common Stock issued or issuable upon the
exercise of the Warrants (the "TOTAL MEYERSON/BROOKEHILL EQUITY") may
demand, on one occasion only, that SOLUCORP, at its own expense, promptly
file a Registration Statement under the Securities Act of 1933, as amended
("ACT"), to permit a public offering of the MEYERSON/BROOKEHILL shares of
Common Stock issued and issuable pursuant to exercise of the
MEYERSON/BROOKEHILL Warrants (the "MEYERSON/BROOKEHILL SHARES").
Additionally, if SOLUCORP, during the period from June 3, 1996 to June 3,
2001 files a Registration Statement covering the sale of any shares of
SOLUCORP Common Stock, then SOLUCORP, on each such occasion, at the request
of the holders of at least 51% of the TOTAL MEYERSON/BROOKEHILL EQUITY,
shall include in any such Registration Statement, at SOLUCORP's expense,
the MEYERSON/BROOKEHILL SHARES, provided that, if the sale of securities by
SOLUCORP is being made through an underwriter and the underwriter objects
to inclusion of the MEYERSON/BROOKEHILL SHARES in the Registration
Statement, the MEYERSON/BROOKEHILL SHARES shall not be so included in any
registration statement filed within 90 days after the effective date of the
Registration statement.
6. This AGREEMENT constitutes the entire Warrant Agreement between the parties
and when a copy hereof is presented to SOLUCORP's transfer agent, together
with a certified check in the proper amount and a request that all or part
of the MEYERSON/BROOKEHILL Warrants be exercised, the certificates for the
appropriate number of shares of Common Stock Shall be promptly issued.
7. Upon the execution of this AGREEMENT, SOLUCORP shall include in their next
annual report and filings the highlights and terms of our investment
banking contract.
8. Within 30 days of the signing of this AGREEMENT, SOLUCORP shall pay
MEYERSON/BROOKEHILL $10,000.00 as a non-accountable and non-refundable
expense allowance for due diligence and general compliance review.
MEYERSON/BROOKEHILL shall be entitled to additional compensation to be
negotiated between MEYERSON/BROOKEHILL and SOLUCORP, arising out of any
transactions that are proposed or executed by MEYERSON/BROOKEHILL and
consummated by SOLUCORP, or are executed by MEYERSON/BROOKEHILL at
SOLUCORP's request, during the term of this AGREEMENT to the extent that
such compensation is normal and ordinary for such transactions. In addition
MEYERSON/BROOKEHILL shall be reimbursed by SOLUCORP for any reasonable
out-of-pocket expenses that MEYERSON/BROOKEHILL may incur in connection
with rendering any service to or on behalf of MEYERSON/BROOKEHILL is
approved, in writing, in advance by SOLUCORP's Chief Executive Officer.
9. SOLUCORP agrees to indemnify and hold MEYERSON/BROOKEHILL and its
directors, officers and employees harmless from and against any and all
losses, claims, damages, liabilities, costs or expenses arising out of any
action or cause of action brought against MEYERSON/BROOKEHILL, in
connection with its rendering services under this AGREEMENT except for any
losses, claims, damages, liabilities, costs or expenses resulting from any
violation by MEYERSON/BROOKEHILL of applicable laws and regulations
including, without limitation, those of the National Association of
Securities Dealers, Inc. and the Securities and Exchange Commission or any
state securities commission or from any act of MEYERSON/BROOKEHILL
involving negligence or willful misconduct and except that SOLUCORP shall
not be liable for any amount paid in settlement of any claim that is
settled without its prior written consent.
10. MEYERSON/BROOKEHILL agrees to indemnify and hold SOLUCORP and its
directors, officers and employees harmless from and against any and all
losses claims, damages, liabilities, costs or expenses resulting from any
violation by MEYERSON/BROOKEHILL of applicable laws and regulations
including, without limitation, those of the National Association of
Securities Dealers, Inc., the Securities and Exchange Commission any state
securities commission or from any act of SOLUCORP involving negligence or
willful misconduct.
11. Nothing contained in this AGREEMENT shall be construed to constitute
MEYERSON/BROOKEHILL as a partner, employee, or agent of SOLUCORP, nor shall
either party have any authority to bind the other in any respect, it being
intended that MEYERSON/BROOKEHILL is, and shall remain an independent
contractor.
12. This AGREEMENT may not be assigned by either party hereto, shall be
interpreted in accordance with the laws of the State of New Jersey, and
shall be binding upon the successors of the parties. Either party may
terminate this investment banking contract at any time, however, legally
vested Warrants will remain with MEYERSON/BROOKEHILL.
13. If any paragraph, sentence, clause or phrase of this AGREEMENT is for any
reason declared to be illegal, invalid, unconstitutional void or
unenforceable, all other paragraphs, sentences, clauses or phrases hereof
not so held shall be and remain in full force and effect.
14. None of the terms of this AGREEMENT shall be deemed to be waived or
modified except by an express agreement in writing signed by the party
against whom enforcement of such waiver or modification is sought. The
failure of either party at any time to require performance by the other
party of any provision hereof shall, in no
way, affect the full right to require such performance at any time
thereafter. Nor shall the waiver by either party of a breach of any
provision hereof be taken or held to be a waiver of any succeeding breach
of such provision or as a waiver of the provision itself.
15. Any dispute, claim or controversy arising out of or relating to this
AGREEMENT, or the breach thereof, shall be settled by arbitration in Jersey
City, New Jersey, in accordance with the Commercial Arbitration Rules of
the American Arbitration Association. The parties hereto agree that they
will abide by and perform any award rendered by the arbitrator(s) and that
judgement upon any such award may be entered in any Court, state or
federal, having jurisdiction over the party against whom the judgement is
being entered. Any arbitration demand, summons, complaint, other process,
notice of motion, or other application to an arbitration panel, Court or
Judge, and any arbitration award or judgement may be served upon any party
hereto by registered or certified mail, or by personal service, provided a
reasonable time for appearance or answer is allowed.
16. For purposes of compliance with laws pertaining to potential inside
information being distributed unauthorized to anyone, all communications
regarding the Company's confidential information should only be directed to
Martin H. Meyerson, Chairman, Michael Silvestri, President, or Linda
Antosiewicz, Vice President, Compliance. If information is being faxed, our
confidential compliance fax number is (201) 332-1263 for communication use.
IN WITNESS WHEREOF, the parties hereto have executed this AGREEMENT as of
the day and year first above written.
M.H. MEYERSON & CO., INC. SOLUCORP INDUSTRIES, LTD.
By: /s/ Michael Silvestri By: /s/ James G. Spartz
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Michael Silvestri James G. Spartz
President Director
BROOKEHILL EQUITIES, INC.
By: /s/ Walter Grossman
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Mr. Walter Grossman
Chairman