Capital Raising Mandate

Transcription

1 Mar 11 Capital Raising Mandate [Company Name] [Company Name] [Company Address] ATP FINANCIAL PARTNERS PTY LTD ACN GPO Box 817, Melbourne, VIC, 3001 Phone w ww.atpfinancialpartners.com.au Corporate Authorised Representative of Pearce Callahan & Associates Pty Ltd

2 We are pleased to confirm our agreement for ATP Financial Partners ( ATP ) to represent [COMPANY NAME] [COMPANY NAME] ([COMPANY NAME]) and to act as [COMPANY NAME] s exclusive financial advisor in connection with both debt and equity capital raising initiatives ( Agreement ). [COMPANY NAME] REQUIREMENTS We confirm that our understanding of [COMPANY NAME] s requirements is as follows: To raise working capital of: $100, by 1 July 2011 To raise equity of: $1,200, by 1 October 2011 To raise a further amount of: $5,000, by 31 September 2012 TERM This Agreement shall become effective upon signing by [COMPANY NAME]. The initial term of this Agreement and the exclusive appointment of ATP ( Term ) shall be three (3) months. Thereafter either [COMPANY NAME] or ATP may terminate the arrangement by giving the other party one month s notice in writing of such termination. PERFORMANCE OF SERVICES ATP will work in conjunction with [COMPANY NAME] and use its reasonable efforts to facilitate the completion of a transaction that will achieve [COMPANY NAME] s requirements. The services to be performed by ATP include, but are not limited to: A. Advise and assist [COMPANY NAME] in determining details of any capital raising initiative. B. Assist in preparing a confidential descriptive memorandum of [COMPANY NAME], and its operations and finances, for use in discussions with Potential Targets. C. Identify, screen and prepare Potential Targets, for the purpose of establishing which Potential Targets will be approached and in what order. D. Contact, establish and attend exploratory meetings with Potential Targets. E. Develop judgments as to the relative values and financial implications to [COMPANY NAME] and any proposed Transaction and then, in consultation with [COMPANY NAME] and legal, accounting and/or tax advisers, advise [COMPANY NAME] on appropriate negotiating strategies and, to the extent deemed appropriate, assist and/or direct negotiations leading to a conclusion of the proposed Transaction. F. [COMPANY NAME] authorises ATP Financial Partners to make offers and arrange the issue of the units by [COMPANY NAME] under the Information Memorandum and [COMPANY NAME] will only issue units in accordance with such offers if they are accepted. [COMPANY NAME] will forward all application forms and all moneys to a trust fund nominated by ATP Financial Partners who will deposit and deal with these moneys pursuant to the Information Memorandum or other relevant documentation. G. ATP will manage all communication services, including mail. This includes but is not limited to the collection of funds and processing of funds. COMPENSATION FOR SERVICES COMMISSION Cash (Capital Raising Services): In partial payment for its services, ATP shall be entitled to 5% non- refundable commission for every equity dollar raised from leads generated by [COMPANY NAME] and processed by [COMPANY NAME] and 5% non- refundable commission for every equity dollar raised from leads generated by ATP. Commission is not payable if ATP invests into the business itself. Commission does not include GST. For terms of payment refer to Terms of Payment. Retainer (Business Services): In partial payment for business services, ATP shall be entitled to receive non- refundable retainer of $4, plus GST per month payable on receipt of invoice.

3 SUCCESS FEE Cash Consideration: If any Transaction is completed by [COMPANY NAME] during the Term or within one (1) year after the end of the Term with a Potential Target nominated by ATP to [COMPANY NAME] or contacted by ATP during the Term, [COMPANY NAME] shall pay ATP or cause ATP to be paid, at the completion of each such Transaction, a fee ( Transaction Fee ) being 5% of the Transaction Value. Equity: If any Transaction is completed by [COMPANY NAME] during the Term or within one (1) year after the end of the Term with a Potential Target nominated by ATP to [COMPANY NAME] or contacted by ATP or [COMPANY NAME] during the Term, [COMPANY NAME] shall issue ATP with shares equally 10% of the issued stock or capitalisation of [COMPANY NAME]. Where other instruments are also on issue - such as preference shares, hybrid securities or convertible instruments - such will also be issued pari passu at 10% so that the spirit and fact of a 10% holding are reflected in the stake held by ATP. Subsequent dilutions will be accepted pari passu subsequent to the close of this capital raise.. MINIMUM FEE If a Transaction Fee becomes payable by [COMPANY NAME], the minimum Transaction Fee is $50, payable at the completion of each Transaction OUT OF POCKET EXPENSES [COMPANY NAME] agrees to reimburse ATP for all reasonable out of pocket expenses incurred including but not limited to travel, lodging, meals and the like. If ATP expects any out of pocket expenses [COMPANY NAME] must firstly approve them. TERMINATION FEE At the date of Termination, a Termination Fee of 50% of the Success Fee will be payable to ATP in the event that the Transaction does not proceed after unconditional investor commitments of $50,000 or greater are received provided the offer is acceptable to [COMPANY NAME] in that it conforms to the agreed market offer and there is no legal impediment to completing the transaction. FIRST RIGHT [COMPANY NAME] grants to ATP a First Right to perform similar services on future fund and capital raising transactions for a period of one year, on the condition that a minimum of $50,000 is raised under this Agreement. The provisions of this paragraph shall survive the termination and expiration of this Agreement. GOODS & SERVICES TAX (GST) If GST is imposed on any supply made to [COMPANY NAME] under this Agreement, [COMPANY NAME] must pay the GST to ATP in addition to and at the same time as payment of any amount otherwise payable for that supply under the Agreement. If ATP incurs any expenses on [COMPANY NAME] s behalf from the date of signing and while the Agreement is in force, ATP will charge [COMPANY NAME] the GST inclusive amount of those expenses less any input tax credits that ATP are entitled to. If ATP incurs any disbursements as [COMPANY NAME] s agent, ATP will charge [COMPANY NAME] the GST inclusive cost of those disbursements and provide [COMPANY NAME] with a tax invoice to enable [COMPANY NAME] to claim an input tax credit where appropriate. INDEMNITY [COMPANY NAME] agrees to indemnify and hold ATP, its officers, employees and agents (each an Indemnified Person ) harmless from and against all losses, claims, damages, liabilities, costs or expenses including those resulting from any threatened or pending investigation, action, proceeding or dispute (except where such loss, claim, damage, liability, cost or expense arose out of an act of gross negligence or gross breach of duty by ATP, its officers, employees or agents) whether or not ATP or any such Indemnified Person is a party to such investigation, action, proceeding or dispute, arising out of ATP s entering into or performing services under this Agreement, or arising out of any matter referred to in this Agreement. [COMPANY NAME] agrees not to solicit or induce any ATP employee or contractor to terminate their employment or association with ATP or to enter employment or association with [COMPANY NAME]. Further, the parties agree that in the event of a breach, damages may not be sufficient and that injunctive relief may be sought. The provisions of this paragraph shall survive the termination and expiration of this Agreement.

4 EXCLUSIVITY In order to co- ordinate the efforts of both ATP and [COMPANY NAME], and to maximise the possibility of completing a Transaction during the Term, ATP shall have the sole and exclusive authority to initiate discussions with regard to a proposed Transaction. In the event [COMPANY NAME], its directors, officers, employees or shareholders receive or initiate any enquiries concerning the Transaction, such enquiries shall be promptly referred to ATP within three (3) working days. NON- DISCLOSURE Any financial or other advice, descriptive memoranda or other documentation rendered by ATP pursuant to this Agreement may not be disclosed publicly or to any third party in any manner without the prior written approval of ATP, such approval not to be unreasonably withheld. All non public information provided by [COMPANY NAME] to ATP will be considered as confidential information and shall be maintained as such by ATP, except as required by law, until the same becomes known to third parties or the public without release thereof by ATP. INFORMATION [COMPANY NAME] agrees to provide to ATP among other things, all reasonable information requested or reasonably required by ATP or a Potential Target including but not limited to, information concerning historical or projected financial results and possible and known litigious and other contingent liabilities. [COMPANY NAME] will promptly advise ATP of any material changes in its business or finances during the Term. [COMPANY NAME] represents that all information made available by ATP by [COMPANY NAME] will be complete and correct in all material respects and will not contain any untrue statements 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. In rendering its services hereunder, ATP will be using and relying primarily on such information without independent verification thereof, or independent appraisal of any of [COMPANY NAME] s assets. ATP does not assume responsibility for the accuracy of completeness of the information. ENTIRE AGREEMENT This Agreement sets forth the entire understanding of the parties relating to the subject matter hereof and supersedes and cancels any prior communications, understandings and agreements between the parties. This Agreement cannot be modified or changed, nor can any of its provisions be waived, except by written agreement signed by all parties hereto. GOVERNING LAWS AND JURISDICTION This Agreement shall be governed by and construed to be in accordance with the laws of the State of Victoria. Any dispute arising out of this Agreement shall be adjudicated in the courts of the State of Victoria and [COMPANY NAME] hereby agrees that service of process upon it by registered or certified mail at the address shown in this Agreement shall be deemed adequate and lawful. The parties hereto shall deliver notices to each other by personal delivery or by registered or certified mail at the addresses set forth herein. COUNTERPART This Agreement may be executed in any number of counterparts. Each counterpart is an original but the counterparts together are one of the same Agreement. Where, for reasons of time and/or distance, one Party is unable to deliver an original counterpart to the other Party, the Parties agree that a copy of the original executed counterpart sent by facsimile machine instead of the original counterpart is sufficient evidence of the execution of the original and may be produced in evidence for all purposes in place of the original. TERMS OF PAYMENT Retainer payments are made monthly in advance. Commission as cash consideration is invoiced fortnightly once the first dollar ($) has been raised. Application forms to be sent to [COMPANY NAME] by ATP weekly. [COMPANY NAME] to pay commission invoices within 30 days of invoice date. If [COMPANY NAME] is for whatever reason not paying as per agreement, ATP will hold application forms until [COMPANY NAME] makes commission payments. An interest rate of 37% per annum will be added to your invoice per day from the date invoice is due. Continued late payment can result in breach of Agreement by [COMPANY NAME] and or result in the holding back of incoming funds as per Agreement by ATP.

5 DEFINITIONS For the purposes of this Agreement, unless the contrary intention appears: Associate means a Related Body Corporate or Associates of a Bodies Corporate as those terms are defined in Sections 50 and 11 respectively of the Corporations Law. [COMPANY NAME] means [COMPANY NAME] DETAILS, its shareholders, Associates and Associates shareholders. GST means the Goods and Services Tax Act 1999 and includes other GST related legislation and regulations under the legislation, as amended from time to time; and except for terms defined in this Agreement, expressions in capitals and GST have the same meaning as in the GST Act. Pari passu Often seen in venture capital term sheets, indicating that one series of equity will have the same rights and privileges as another series of equity. ( Of equal step' in Latin). Potential Target means a principal party and/or its Associate. Transaction means a purchase, sale or other business transaction by means of (but not limited to) a cash offer, joint venture, business relationship, substantial customer relationship, securities exchange offer or purchase or sale of shares, units, stock, assets, capital raising, debt raising, assumption or liability, project or financial funding or any combination thereof. Transaction Value means: a. The total consideration or cost of a purchase, sale or other business transaction (incorporating any consideration however provided to or by [COMPANY NAME] which has the effect of reducing the quantum of consideration payable in any Transaction), the value to [COMPANY NAME] of a business relationship or substantial customer relationship, financing or refinancing received, reductions or forgiveness of debt, share issue moneys or other consideration received (which shall be deemed to include amounts paid into escrow and/or deferred) by [COMPANY NAME] upon the consummation of any Transaction (including payments made in installments), inclusive of cash, securities, notes, consulting or leasing agreements and agreements not to compete, plus the total value of any liabilities assumed. b. If a portion of such consideration includes contingent payments related to future earnings or operations, Transaction Value shall also include the face value of such payments without regard as to whether the conditions for the payment of such contingent amounts have been or may be satisfied. c. If the consideration for the Transaction consists in whole or in part of securities, for the purposes of calculating the amount of Transaction Value, the value of such securities will be the value thereof on the day preceding the consummation of the Transaction as [COMPANY NAME] and ATP agree, provided however that in the case of securities for which there is a public trading market, the value will be determined by the average last sales prices for such securities for the last twenty (20) trading days prior to such consummation as determined by ATP and communicated by ATP to [COMPANY NAME]. If there is no public trading market for such securities or other property received or receivable and the parties are unable to agree, then each of ATP and [COMPANY NAME] will select an investment banking firm respected in the merger and acquisition field to determine a value and the midpoint between the two values established by the two independent experts will be the fair market value for the purposes hereof.

6 ACCEPTANCE Please confirm that the foregoing is in accordance with your understanding by signing on behalf of [COMPANY NAME] and returning a signed copy of this Agreement to ATP. We look forward to working with you. Yours faithfully, Aaron Pearce Director ATP Financial Partners ACCEPTED AND AGREED TO: [COMPANY NAME] [COMPANY NAME] Signature: Signature: [Company Name]: PLEASE PRINT Director [Company Name]: PLEASE PRINT Director / Secretary Who each warrant that they are expressly authorised to bind [COMPANY NAME] in relation to this Agreement.