EXHIBIT 10.3
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DEEP FIELD TECHNOLOGIES
PLACEMENT AGENT AGREEMENT
Dated as of: September 9, 2005
Monitor Capital Inc.
9171 Towne Centre Drive, Suite 465
San Diego, CA 92122
Ladies and Gentlemen:
The undersigned, Deep Field Technologies, Inc., a New Jersey
corporation (the "Company"), hereby agrees
with Monitor Capital, Inc. (the
"Placement Agent") and Cornell Capital
Partners, LP, a Delaware Limited
Partnership (the "Investor"), as
follows:
1. Offering. The
Company hereby engages the Placement Agent to act as
its exclusive placement agent in connection
with the Standby Equity Distribution
Agreement dated the date hereof (the
"Standby Equity Distribution Agreement"),
pursuant to which the Company shall issue
and sell to the Investor, from time to
time, and the Investor shall purchase from
the Company (the "Offering") up to
Ten Million Dollars ($10,000,000) of the
Company's Class A common stock (the
"Commitment Amount"), no par value per
share (the "Common Stock"), at price per
share equal to the Purchase Price, as that
term is defined in the Standby Equity
Distribution Agreement. The Placement Agent
services shall consist of reviewing
the terms of the Standby Equity
Distribution Agreement and advising the Company
with respect to those terms.
All capitalized terms used herein and not otherwise defined
herein
shall have the same meaning ascribed to
them as in the Standby Equity
Distribution Agreement. The Investor will
be granted certain registration rights
with respect to the Common Stock as more
fully set forth in the Registration
Rights Agreement between the Company and
the Investor dated the date hereof (the
"Registration Rights Agreement"). The
documents to be executed and delivered in
connection with the Offering, including,
but not limited, to the Company's
latest Quarterly Report on Form 10-QSB as
filed with the United States
Securities and Exchange Commission, this
Agreement, the Standby Equity
Distribution Agreement, the Registration
Rights Agreement, and the Escrow
Agreement dated the date hereof (the
"Escrow Agreement"), are referred to
sometimes hereinafter collectively as the
"Offering Materials." The Company's
Common Stock purchased by the Investor
hereunder is sometimes referred to
hereinafter as the "Securities." The
Placement Agent shall not be obligated to
sell any Securities.
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2. Compensation.
Upon the execution of this Agreement, the Company
shall issue to the Placement Agent or its
designee shares of the Company's
Common Stock in an amount equal to Ten
Thousand Dollars ($10,000) divided by the
lowest closing bid price of the Company's
Common Stock, as quoted by Bloomberg,
LP, on the fifth (5th) Trading Day of the
Company's Common Stock once it is
listed on a Principal Market, as such term
is defined in the Standby Equity
Distribution Agreement of even date hereof
(the "Placement Agent's Shares"). The
Placement Agent shall be entitled to
"piggy-back" registration rights with
respect to the Placement Agent's Shares,
which shall be triggered upon
registration of any shares of Common Stock
by the Company pursuant to the
Registration Rights Agreement dated the
date hereof.
3.
Representations, Warranties and Covenants of the Placement
Agent.
A. The Placement
Agent represents, warrants and covenants as
follows:
(i) The
Placement Agent has the necessary power to enter
into this Agreement and to consummate the
transactions contemplated hereby.
(ii) The execution and delivery by the
Placement Agent of
this Agreement and the consummation of the
transactions contemplated herein will
not result in any violation of, or be in
conflict with, or constitute a default
under, any agreement or instrument to which
the Placement Agent is a party or by
which the Placement Agent or its properties
are bound, or any judgment, decree,
order or, to the Placement Agent's
knowledge, any statute, rule or regulation
applicable to the Placement Agent. This
Agreement when executed and delivered by
the Placement Agent, will constitute the
legal, valid and binding obligations of
the Placement Agent, enforceable in
accordance with their respective terms,
except to the extent that (a) the
enforceability hereof or thereof may be
limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws
from time to time in effect and affecting
the rights of creditors generally, (b)
the enforceability hereof or thereof is
subject to general principles of equity,
or (c) the indemnification provisions
hereof or thereof may be held to be in
violation of public policy.
(iii) Upon receipt and execution of this Agreement, the
Placement Agent will promptly forward
copies of this Agreement to the Company or
its counsel and the Investor or its
counsel.
(iv) The Placement
Agent will not intentionally take any
action that it reasonably believes would
cause the Offering to violate the
provisions of the Securities Act of 1933,
as amended (the "Securities Act"), the
Securities Exchange Act of 1934 (the
"Exchange Act"), the respective rules and
regulations promulgated thereunder (the
"Rules and Regulations") or applicable
"Blue Sky" laws of any state or
jurisdiction.
(v) The
Placement Agent is a member of the National
Association of Securities Dealers, Inc.,
and is a broker-dealer registered as
such under the Exchange Act and under the
securities laws of the states in which
the Securities will be offered or sold by
the Placement Agent unless an
exemption for such state registration is
available to the Placement Agent. The
Placement Agent is in material compliance
with the rules and regulations
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applicable to the Placement Agent generally
and applicable to the Placement
Agent's participation in the Offering.
4.
Representations, Warranties and Covenants of the Company.
A. The Company
represents, warrants and covenants as follows:
(i) The
execution, delivery and performance of each of this
Agreement, the Standby Equity Distribution
Agreement, the Escrow Agreement, and
the Registration Rights Agreement have been
or will be duly and validly
authorized by the Company and is, or with
respect to this Agreement, the Standby
Equity Distribution Agreement, the Escrow
Agreement, and the Registration Rights
Agreement, will be a valid and binding
agreement of the Company, enforceable in
accordance with its respective terms,
except to the extent that (a) the
enforceability hereof or thereof may be
limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws
from time to time in effect and
affecting the rights of creditors
generally, (b) the enforceability hereof or
thereof is subject to general principles of
equity or (c) the indemnification
provisions hereof or thereof may be held to
be in violation of public policy.
The Securities to be issued pursuant to the
transactions contemplated by this
Agreement and the Standby Equity
Distribution Agreement have been duly
authorized and, when issued and paid for in
accordance with this Agreement, the
Standby Equity Distribution Agreement and
the certificates/instruments
representing such Securities, will be valid
and binding obligations of the
Company, enforceable in accordance with
their respective terms, except to the
extent that (1) the enforceability thereof
may be limited by bankruptcy,
insolvency, reorganization, moratorium or
similar laws from time to time in
effect and affecting the rights of
creditors generally, and (2) the
enforceability thereof is subject to
general principles of equity. All corporate
action required to be taken for the
authorization, issuance and sale of the
Securities has been duly and validly taken
by the Company.
(ii) The Company has a
duly authorized, issued and
outstanding capitalization as set forth
herein and in the Standby Equity
Distribution Agreement. The Company is not
a party to or bound by any
instrument, agreement or other arrangement
providing for it to issue any capital
stock, rights, warrants, options or other
securities, except for this Agreement,
the agreements described herein and as
described in the Standby Equity
Distribution Agreement, dated the date
hereof and the agreements described
therein. All issued and outstanding
securities of the Company, have been duly
authorized and validly issued and are fully
paid and non-assessable; the holders
thereof have no rights of rescission or
preemptive rights with respect thereto
and are not subject to personal liability
solely by reason of being security
holders; and none of such securities were
issued in violation of the preemptive
rights of any holders of any security of
the Company.
(iii) The Common Stock to be issued in accordance with this
Agreement and the Standby Equity
Distribution Agreement has been duly authorized
and, when issued and paid for in accordance
with this Agreement and the Standby
Equity Distribution Agreement, the
certificates/instruments representing such
Common Stock will be validly issued,
fully-paid and non-assessable; the holders
thereof will not be subject to personal
liability solely by reason of being such
holders; such Securities are not and will
not be subject to the preemptive
rights of any holder of any security of the
Company.
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(iv) The Company has
good and marketable title to, or valid
and enforceable leasehold estates in, all
items of real and personal property
necessary to conduct its business
(including, without limitation, any real or
personal property stated in the Offering
Materials to be owned or leased by the
Company), free and clear of all liens,
encumbrances, claims, security interests
and defects of any material nature
whatsoever, other than those set forth in the
Offering Materials and liens for taxes not
yet due and payable.
(v) There is no litigation or governmental proceeding pending
or, to the best of the Company's knowledge,
threatened against, or involving the
properties or business of the Company,
except as set forth in the Offering
Materials.
(vi) The Company has
been duly organized and validly exists
as a corporation in good standing under the
laws of the State of New Jersey.
Except as set forth in the Offering
Materials, the Company does not own or
control, directly or indirectly, an
interest in any other corporation,
partnership, trust, joint venture or other
business entity. The Company is duly
qualified or licensed and in good standing
as a foreign corporation in each
jurisdiction in which the character of its
operations requires such
qualification or licensing and where
failure to so qualify would have a material
adverse effect on the Company. The Company
has all requisite corporate power and
authority, and all material and necessary
authorizations, approvals, orders,
licenses, certificates and permits of and
from all governmental regulatory
officials and bodies (domestic and foreign)
to conduct its businesses (and
proposed business) as described in the
Offering Materials. Any disclosures in
the Offering Materials concerning the
effects of foreign, federal, state and
local regulation on the Company's
businesses as currently conducted and as
contemplated are correct in all material
respects and do not omit to state a
material fact. The Company has all
corporate power and authority to enter into
this Agreement, the Standby Equity
Distribution Agreement, the Registration
Rights Agreement, and the Escrow Agreement,
to carry out the provisions and
conditions hereof and thereof, and all
consents, authorizations, approvals and
orders required in connection herewith and
therewith have been obtained. No
consent, authorization or order of, and no
filing with, any court, government
agency or other body is required by the
Company for the issuance of the
Securities or execution and delivery of the
Offering Materials except for
applicable federal and state securities
laws. The Company, since its inception,
has not incurred any liability arising
under or as a result of the application
of any of the provisions of the Securities
Act, the Exchange Act or the Rules
and Regulations.
(vii) There has been no material adverse change in the
condition or prospects of the Company,
financial or otherwise, from the latest
dates as of which such condition or
prospects, respectively, are set forth in
the Offering Materials, and the outstanding
debt, the property and the business
of the Company conform in all material
respects to the descriptions thereof
contained in the Offering Materials.
(viii) Except as set forth in the Offering Materials, the
Company is not in breach of, or in default
under, any term or provision of any
material indenture, mortgage, deed of
trust, lease, note, loan or Standby Equity
Distribution Agreement or any other
material agreement or instrument evidencing
an obligation for borrowed money, or any
other material agreement or instrument
to which it is a party or by which it or
any of its properties may be bound or
affected. The Company is not in violation
of any provision of its charter or
by-laws or in violation of any franchise,
license, permit, judgment, decree or
order, or in violation of any
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material statute, rule or regulation.
Neither the execution and delivery of the
Offering Materials nor the issuance and
sale or delivery of the Securities, nor
the consummation of any of the transactions
contemplated in the Offering
Materials nor the compliance by the Company
with the terms and provisions hereof
or thereof, has conflicted with or will
conflict with, or has resulted in or
will result in a breach of, any of the
terms and provisions of, or has
constituted or will constitute a default
under, or has resulted in or will
result in the creation or imposition of any
lien, charge or encumbrance upon any
property or assets of the Company or
pursuant to the terms of any indenture,
mortgage, deed of trust, note, loan or any
other agreement or instrument
evidencing an obligation for borrowed
money, or any other agreement or
instrument to which the Company may be
bound or to which any of the property or
assets of the Company is subject except (a)
where such default, lien, charge or
encumbrance would not have a material
adverse effect on the Company and (b) as
described in the Offering Materials; nor
will such action result in any
violation of the provisions of the charter
or the by-laws of the Company or,
assuming the due performance by the
Placement Agent of its obligations
hereunder, any material statute or any
material order, rule or regulation
applicable to the Company of any court or
of any foreign, federal, state or
other regulatory authority or other
government body having jurisdiction over the
Company.
(ix) Subsequent to the dates as of which information is given
in the Offering Materials, and except as
may otherwise be indicated or
contemplated herein or therein, the Company
has not (a) issued any securities or
incurred any liability or obligation,
direct or contingent, for borrowed money,
or (b) entered into any transaction other
than in the ordinary course of
business, or (c) declared or paid any
dividend or made any other distribution on
or in respect of its capital stock. Except
as described in the Offering
Materials, the Company has no outstanding
obligations to any officer or director
of the Company.
(x) There are no
claims for services in the nature of a
finder's or origination fee with respect to
the sale of the Common Stock or any
other arrangements, agreements or
understandings that may affect the Placement
Agent's compensation, as determined by the
National Association of Securities
Dealers, Inc.
(xi) The Company owns
or possesses, free and clear of all
liens or encumbrances and rights thereto or
therein by third parties, the
requisite licenses or other rights to use
all trademarks, service marks,
copyrights, service names, trade names,
patents, patent applications and
licenses necessary to conduct its business
(including, without limitation, any
such licenses or rights described in the
Offering Materials as being owned or
possessed by the Company) and, except as
set forth in the Offering Materials,
there is no claim or action by any person
pertaining to, or proceeding, pending
or threatened, which challenges the
exclusive rights of the Company with respect
to any trademarks, service marks,
copyrights, service names, trade names,
patents, patent applications and licenses
used in the conduct of the Company's
businesses (including, without limitation,
any such licenses or rights described
in the Offering Materials as being owned or
possessed by the Company) except any
claim or action that would not have a
material adverse effect on the Company;
the Company's current products, services or
processes do not infringe or will
not infringe on the patents currently held
by any third party.
(xii) Except as described in the Offering Materials, the
Company is not under any obligation to pay
royalties or fees of any kind
whatsoever to any third party with
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respect to any trademarks, service marks,
copyrights, service names, trade
names, patents, patent applications,
licenses or technology it has developed,
uses, employs or intends to use or employ,
other than to their respective
licensors.
(xiii) Subject to the performance by the Placement Agent of
its obligations hereunder the offer and
sale of the Securities complies, and
will continue to comply, in all material
respects with the requirements of Rule
506 of Regulation D promulgated by the SEC
pursuant to the Securities Act and
any other applicable federal and state
laws, rules, regulations and executive
orders. Neither the Offering Materials nor
any amendment or supplem
