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Exhibit 10.2
PLACEMENT AGENT AND ADVISORY
SERVICES AGREEMENT
This Placement Agent and Advisory Services Agreement (this
"Agreement") is made
as of May 8, 2007 (the "Effective Date"), by and between
American Soil
Technologies, Inc., a Nevada corporation (together with its
subsidiaries, the
"Company"), and Monarch Bay Associates, LLC, a California
limited liability
company ("MBA"). MBA and the Company agree as follows:
1. ENGAGEMENT OF MBA: The Company hereby engages MBA, and MBA
hereby accepts
such engagement, to act as:
(a) the Company's placement agent on a non-exclusive basis with
respect to
finding investors (the "Investors") for an offering of the
Company's
capital stock in a transaction or transactions exempt from
registration under the Securities Act of 1933, as amended, and
in
compliance with the applicable laws and regulations of any
jurisdiction in which securities are sold under this Agreement
(a
"Private Placement"); and
(b) the Company's advisor, on a non-exclusive basis, in
identifying and
introducing prospective parties to an acquisition, merger,
joint
venture or any other similar transaction or relationship,
directly or
indirectly, involving the Company (a "Transaction").
The Company acknowledges and agrees that MBA's obligations
hereunder are on
a reasonable best efforts basis only and that the execution of
this
Agreement does not constitute a commitment by MBA to purchase
the
securities and does not ensure the successful placement of the
securities
or any portion thereof or the success of MBA with respect to
securing any
other financing or a Transaction on behalf of the Company. MBA
will act
solely as a broker with respect to identifying and negotiating
with
potential investors in securities that may be issued in the
Private
Placement and potential parties to a Transaction. MBA will not
act as an
underwriter in any Private Placement or Transaction.
2. MBA'S COMPENSATION: The Company hereby agrees to pay MBA fees
in such
amount and upon such terms and conditions contained herein upon
the
successful completion of a Private Placement as follows:
(a) Success Fees. The Company will pay MBA a Success Fee, as
described
below, when the Company closes on a Private Placement or a
Transaction
during the Term (as hereinafter defined) of this Agreement or
during a
one-year period thereafter, so long as any purchasers of the
Company's
capital stock or parties to a Transaction were identified by
or
introduced to the Company by MBA (or are affiliates of any
person so
identified or introduced).
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Computation and Payment of Success Fees.
(i) PRIVATE PLACEMENTS. For each Private Placement, the Success
Fee will be (x)
a cash fee equal to 9% of gross proceeds raised in the Private
Placement
(including, without limitation, upon exercise of any warrants
issued in Private
Placement) and (y) warrants (the "MBA Warrants") to purchase 9%
of the total
number of shares of common stock issued and issuable by the
Company to Investors
under and in connection with the Private Placement, including
(without
limitation) shares issuable upon conversion or exercise of the
securities sold
in the Private Placement, at an exercise price equal to the
purchase price of
the common stock sold in the Private Placement or, in the event
that securities
convertible into common stock are sold in the Private Placement,
the conversion
price of such securities.
The cash portion of the Success Fee will be due and payable upon
the closing of
each Private Placement and will be payable directly to MBA from
the escrow
established for such closing or in such other manner as may be
acceptable to
MBA.
MBA Warrants will have a five year term (or such longer term as
is provided in
any warrants issued in the Private Placement) and will provide
for cashless
exercise (even if the Investors do not have such a right). MBA
Warrants will
have the benefit of full ratchet anti-dilution protection
against issuances of
securities at prices (or with conversion or exercise prices, in
the case of
convertible securities, warrants, options or rights) below the
exercise price of
MBA Warrants. MBA Warrants will not be callable or redeemable.
The shares
underlying MBA Warrants will be included in the first
registration statement
filed by the Company covering the securities issued in the
Private Placement (or
securities issuable upon conversion or exercise thereof). MBA
Warrants will be
transferable within MBA's organization, at MBA's discretion. MBA
Warrants will
contain such other terms and conditions no less favorable to MBA
than the term
and conditions of any warrants issued to the Investors in the
Private Placement.
(ii) TRANSACTIONS. For each Transaction, the Success Fee will be
a cash fee
equal to 3% of the Total Consideration (as defined below) with
respect to such
Transaction. As used herein. "Total Consideration" means, with
respect to any
Transaction, the total value of all cash, securities, or other
property paid or
received, directly or indirectly, by the Company or its owners
(at closing or in
the future) in connection with such Transaction, including
(without limitation)
in respect of (i) the assumption (by contract, operation of law
or otherwise) of
any indebtedness or (ii) consulting, non-compete or similar
agreements.
The Success Fee will be due and payable upon the closing of each
Transaction and
will be payable directly to MBA from the escrow established for
such closing or
in such other manner as may be acceptable to MBA; provided that
in the case of
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any installment or contingent payment made in respect of the
Transaction, the
Success Fee in respect of such installment or contingent payment
shall be due
and payable on the date such payment is made.
3. CERTAIN MATTERS RELATING TO MBA'S DUTIES:
(a) MBA shall (i) assist the Company in the preparation of
information
documents to be shared with potential Investors and parties
to
Transactions (ii) identify and screen potential Investors and
parties
to Transactions, and (iii) perform other related duties.
(b) MBA shall perform its duties under this Agreement in a
manner
consistent with the instructions of the Company. Such
performance
shall include the delivery of information to potential
interested
parties, conducting due diligence, and leading discussions
with
potential Investors and parties to Transactions.
(c) MBA shall not engage in any form of general solicitation
or
advertising in performing its duties under this Agreement.
This
prohibition includes, but is not limited to, any mass mailing,
any
advertisement, article or notice published in any magazine,
newspaper
or newsletter and any seminar or meeting where the attendees
have been
invited by any mass mailing, general solicitation or
advertising.
(d) MBA is and will hereafter act as an independent contractor
and not as
an employee of the Company and nothing in this Agreement shall
be
interpreted or construed to create any employment, partnership,
joint
venture, or other relationship between MBA and the Company. MBA
will
not hold itself out as having, and will not state to any person
that
MBA has, any relationship with the Company other than as an
independent contractor. MBA shall have no right or power to find
or
create any liability or obligation for or in the name of the
Company
or to sign any documents on behalf of the Company.
4. CERTAIN MATTERS RELATING TO COMPANY'S DUTIES:
(a) The Company shall promptly provide MBA with all relevant
information
about the Company (to the extent available to the Company in the
case
of parties other than the Company) that shall be reasonably
requested
or required by MBA, which information shall be complete and
accurate
in all material respects at the time furnished.
(b) The Company recognizes that in order for MBA to perform
properly its
obligations in a professional manner, it is necessary that MBA
be
informed of and, to the extent practicable, participate in
meetings
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and discussions between the Company and any third party,
including,
without limitation, any prospective purchaser of the
Company's
securities, relating to the matters covered by the terms of
MBA's
engagement.
(c) The Company agrees that any report or opinion, oral or
written,
delivered to it by MBA is prepared solely for its confidential
use and
shall not be reproduced, summarized, or referred to in any
public
document or given or otherwise divulged to any other person
without
MBA's prior written consent, except as may be required by
applicable
law or regulation.
(d) The Company represents and warrants that: (i) it has full
right, power
and authority to enter into this Agreement and to perform all of
its
obligations hereunder; (ii) this Agreement has been duly
authorized
and executed by and constitutes a valid and binding agreement of
the
Company enforceable in accordance with its terms; and (iii)
the
execution and delivery of this Agreement and the consummation of
the
transactions contemplated hereby do not conflict with or result
in a
breach of the Company's certificate of incorporation or
by-laws.
Further, this Agreement and the transactions contemplated herein
shall
not conflict with or result in the breach of any agreement to
which
the Company is a party at the time the transactions
contemplated
herein are consummated.
5. TERM; TERMINATION OF AGREEMENT. The term of this Agreement
shall commence
on the Effective Date and shall expire 180 days thereafter
unless
terminated earlier pursuant to the terms of this paragraph (the
"Term").
Either party may terminate this Agreement prior to its
expiration by
notifying the other party in writing. Notwithstanding the
foregoing, all
provisions of this Agreement (including Exhibit A hereto) other
than
Sections 1, 3 and 4 (a) and (b) shall survive the termination or
expiration
of this Agreement. MBA shall be entitled to compensation under
Section 2
(and payment for non-accountable expenses under Section 12)
based on the
completion of a Private Placement or a Transaction prior to the
termination
or expiration of this Agreement or during the period one year
following
termination so long as any Investors
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