Exhibit 10.36
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Carnegie International Corporation
NASD OTC BB: CGYC
11350 McCormick Road
Executive Plaza III, Suite 1001
Hunt Valley, Maryland 21031
410-785-7400 : Fax: 410-785-7415
E-mail: Carnegie@Carnegieint.com
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Website: www.carnegieint.com
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September 15, 2000
Edison & Co., Inc.
P.O. Box 351
Cockeysville, Maryland 21030
Gentlemen:
This letter is an agreement (the "Agreement") whereby Edison & Co., Inc., a
Delaware corporation ("Consultant"), is appointed as consultant and placement
agent for Carnegie International Corporation, a Colorado corporation ("Company")
in connection with the placement of financing by debt or equity, the negotiation
of strategic alliance agreements or other transactions, which serve to provide
capital and other considerations in furtherance of Company's business.
In connection with the transactions above, Consultant and Company agree to
the following terms and conditions:
1. Appointment as Consultant. Company hereby appoints Consultant as a
non-exclusive placement agent with respect to Company's goal of raising up to
Eight Million Dollars ($8,000,000) to fund the operations of Company.
Consultant will perform its duties, set forth below, as an independent
contractor and not as an employee of Company.
2. Duties of Consultant. Consultant will:
(a) identify prospective lenders, investors and/or strategic
partners and facilitate communications between Company and such
entities;
(b) coordinate meetings between such entities and Company;
(c) advise Company in connection with any negotiations with
lenders, investors, purchasers, and/or strategic partners;
(d) take such incidental or related actions on behalf of Company
as may be appropriate; and
(e) only represent Company's interests in its activities
described herein during the term of this agreement and will not
represent any lender, investor, strategic partner, or service
provider in a direct conflict or interest. If a potential or
actual conflict of interest arises, Consultant is obligated to
notify Company immediately.
Consultant is not authorized to: (i) act on behalf of Company in accepting
any terms or conditions associated with a transaction arising hereunder, or (ii)
accept on behalf of Company any offer from a prospective lender, investor,
strategic partner or purchaser.
3. Non-Exclusive Engagement. Consultant recognizes that compensation
pursuant to Paragraph 6 below, will be forthcoming only for transactions
resulting from Consultant's efforts as set forth in Paragraph 2 above, and that
this agreement is a non-exclusive arrangement.
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4. Expenses. Consultant will be responsible for all expenses it incurs in
pursuit of its duties to be performed under this Agreement with the exception of
those expenses authorized and pre-approved by Company.
5. Fee Schedule.
(a) Consultant's total compensation from Company for all of its
efforts and services hereunder shall be a fee based on the amount paid in
connection with a financing or business transaction. The fee shall be paid only
if, as and when the transaction is finally consummated. The fee shall be
determined as a percentage of the Consideration for the transaction received by
Company as of the Closing. Consultant shall receive a fee from Company at the
Closing equal to six percent (6%) of the aggregate Consideration for each
transaction, which fee shall be payable by the issuance of Company common stock,
no par value (the "Common Stock") in payment thereof at the Current Trading
Price.
(b) "Consideration" means the amount of equity or debt or the value
paid or to be paid by a buyer for the interest purchased, and includes notes and
other debt instruments such as debentures whether convertible or non-
convertible, cash and cash equivalents, and the agreed upon value of property,
whether real or personal, tangible or intangible. "Consideration" also includes
assumed liabilities, stock rights, warrants, options, puts, calls, discounts,
tax loss benefits whether actual or potential, loans and other repayable
payments, non-complete payments, earnouts or similar future conditional
agreements, certificates of contingent interest whether transferable or not, or
salaries paid or other benefits including stock or stock options made available
to principals. Consideration shall be valued at the time of its actual transfer.
(c) "Closing" shall be defined at the time when the equity placement,
debt financing or other transaction is closed or when title to an interest is
transferred by or to Company. All related transactions shall be deemed a single
Closing for calculation of Consultant's fee.
(d) "Current Trading Price" means the current or closing market price
per share of Common Stock at any date which shall be deemed to be the average of
the daily closing prices for 10 consecutive trading days commencing two trading
days before the date of such computation. The closing price for each day shall
be the last sale price for such day, as reported in the principal consolidated
transaction reporting system with respect to securities listed or admitted to
trading on the New York Stock Exchange (the "NYSE") or if the Common Stock is
not listed on the NYSE, then on the principal United States national securities
exchange on which the Common Stock is listed or quoted. If the Common Stock is
not listed or quoted on any United States national securities exchange, then the
current or closing market price per share of Common Stock shall be determined by
the Board of Directors of the Company in good faith.
All fees due to the Consultant are to be paid at Closing, unless agreed
otherwise.
6. Fee Transactions. If, within twelve (12) months after the expiration
or termination of this agreement, Company or any of its affiliates obtains
financing from or consummates a transaction as referenced above with any of the
parties whom Consultant has identified and introduced to Company, the fees
provided for in Paragraph 6 hereof shall be due and payable to Consultant.
7. Accuracy of Information. Company is responsible for all information
and representations concerning its operations and financial condition which may
be provided to potential investors, purchasers, and/or strategic partners.
Company understands that Consultant is not obligated to undertake any
independent verification of or assume any responsibility for the accuracy,
fairness or completeness of such information. Company shall provide to
Consultant all information and other materials reasonably requested by
Consultant in connection with the contemplated transaction in order to assure
compliance with applicable federal and state securities laws or otherwise
reasonably requested by Consultant in order to carry out its responsibilities as
set forth herein.
8. Confidentiality; Best Efforts. Both Company and Consultant recognize
an obligation to keep confidential all information and other work products
provided by each to the other and both parties agree to execute the
Confidentiality Agreement attached hereto. Both parties shall proceed in good
faith to obtain the successful consummation of the transaction described above.
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9. Indemnity. The Company agrees to indemnify and hold harmless Consultant and
its affiliates, the respective directors, officers, partners, agents and
employees of Consultant (collectively, "Indemnified Persons"), from and against
any losses, claims, damages or liabilities (including actions or proceedings in
respect thereof) and any related expenses and fees (including attorneys fees)
occasioned or arising from any willful misconduct, bad faith or gross negligence
on the part of the Company, (collectively "Losses") which are (a) related to or
arising out of (i) the Company's 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 the Company's
consent or in reliance on the Company's actions or failures to act, or (b)
otherwise related to or arising out of the Agreement, except that this clause
(b) shall not apply to any Losses that are finally judicially determined to have
resulted primarily from Consultant's willful misconduct, bad faith or gross
negligence. If such indemnification is for any reason not available or
insufficient to hold you harmless, we agree to contribute to the Losses involved
in such proportion as is appropriate to reflect the relative benefits received
(or anticipated to be received) by us and by you with respect to the Agreement
or, if such allocation is judicially determined unavailable, in such proportion
as is appropriate to reflect other equitable considerations such as the relative
fault of us on the one hand and of you on the other hand; provided, however,
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that, to the extent permitted by applicable law, the Indemnified Persons shall
not be responsible for amounts which in the aggregate are in excess of the
amount of all fees actually received by you from us in connection with the
Agreement. Relative benefits to us, on the one hand, and you, on the other
hand, with respect to the Agreement 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 Agreement bears
to (ii) all fees paid or proposed to be paid to you by us in connection with
the Agreement.
Additionally, Consultant agrees to indemnify and hold harmless the Company, its
subsidiaries and the respective directors, officers, partners, agents and
employees of the Company and its subsidiaries from and against any losses,
claims, damages or liabilities (including reasonable attorneys fees), including
any and all actions, suits or proceedings in respect thereof, relating to or
arising from any actions or failures to act of Consultant which are alleged or
found to be the willful misconduct, bad faith or gross negligence of Consultant
in duties performed under the Agreement.
10. Effective Date; Termination. This Agreement will be in effect for a
period of six (6) months from the date of acceptance of this letter and will
automatically be renewed for successive terms of six (6) months unless
terminated in writing by either party.
11. Noncircumvention. Each of Consultant and Company convenants and agree
that it shall not approach, solicit, discuss or negotiate with any other party
or parties regarding any confidential information or the negotiations between
the Company and the Consultant and each of Consultant and Company agrees that it
shall not enter into any arrangement, undertaking or act for profit, commission,
income, finder's fee or other benefit with results from disclosures made by a
party to the other party pursuant to this Agreement in circumvention of this
Agreement or the parties hereto. Each of Consultant and Company do further
agree that it shall not enter into a transaction with a third party which is
introduced by one party to the other pursuant to this Agreement except in strict
conformity with the terms and conditions of this Agreement.
12. Governing Law. This Agreement shall be governed by the laws of the
State of Maryland.
13. Notices. All notices under this letter agreement shall be in writing
and shall be mailed, delivered or sent by facsimile transmission to the parties
at the addresses specified herein and any such notices shall be effective upon
delivery thereof.
14. Binding Effect. This Agreement shall inure to the benefit of the
binding upon each of the parties hereto and their respectives, successors and
assigns.
15. Broker's Fees. Each of the parties to this letter agreement
represents that it has not dealt with any broker or finder, or any person who
may claim entitlement to a broker's or finder's fee, commission, or similar
compensation in connection with any of the financing transactions contemplated
by this letter agreement and each party shall indemnify the other from any such
fees, commissions or similar compensation.
16. Miscellaneous.
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(a) This Agreement contains and represents the entire Agreement of
the parties and shall not be amended, modified, terminated or discharged, in
whole or in part, except by an instrument in writing signed by all parties
hereto to their respective successors or assigns.
(b) All rights and obligations created by this Agreement are
intended to be enforceable in accordance with its terms and to the extent
permitted by law. In the event, however, that any provision of this Agreement
is held unlawful or unenforceable by a court of law, such invalidity shall not
affect any other provisions and all other such provisions shall remain in full
force and effect.
(c) Neither party may assign its rights or delegate its duties hereunder
without the prior written consent of the other.
17. Counterparts; Facsimile Signature. This Agreement may be executed in
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument. A facsimile signature
shall bind the parties hereto and be enforceable with the same effect as an
original signature hereon.
Please execute this Agreement as indicated below and return a copy by
facsimile and an original by overnight courier service at your earliest
convenience.
Sincerely,
Carnegie International Corporation
By: /S/Lowell Farkas
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Lowell Farkas,
President and Chief Executive Officer
The foregoing letter agreement is hereby accepted and agreed to as of this
15th day September, 2000.
Edison & Co., Inc.
By: /S/Michael J. Edison
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President and Chief Executive Officer
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