EXHIBIT 10.2
[LOGO]
Member of NASD, MSRB and SIPC
EMPIRE
FINANCIAL GROUP, INC
14 East 60
Street, 2nd Floor
NY, NY I0022
646-329-7007
973-277-3634
December 2, 2006
Mr. Peter Katevatis
Chief Executive Officer/ President
Mediscience Technology Corporation
1235 Folkestone Way
Cherry hill, NJ 08034
Dear Mr. Peter Katevatis:
This
letter (the "Agreement") constitutes the agreement between
Mediscience Technology
Corporation (the
"Company") and Empire Financial Group,
Inc. ("Empire") that
Empire shall serve as the placement agent for the Company,
on a "best efforts"
basis, in connection with the proposed offer and
private
placement (the
"Offering") by the
Company of $2.0 million and is predicated on
successful completion of the doe diligence investigation by
Empire.
A. Fees
and Expenses. In connection with the Services described above,
the
Company shall pay to Empire the following:
1.
Placement Agent's Fee.
As compensation for
its services in connection
with the Private
Placement, the Company
agrees to pay Empire a
nonrefundable
retainer fee of $10,000 ("Ten Thousand Dollars") in cash upon execution
of this
letter agreement. The
Company shall pay to Empire a cash placement fee equal to
twelve percent (12.0%) of the aggregate purchase price paid by each
purchaser of
Securities that were placed in the Offering (the "Placement
Agent's Fee").
The
Placement Agent's Fee wilt be deducted from the gross proceeds of
the Securities
sold at the Closing,
The amount of the retainer tee previously paid to Empire
will be credited on a
dollar for dollar
basis toward the cash
portion of the
placement fee.
2,
Expenses. In addition to any fees payable to Empire hereunder and
regardless of whether an Offering is consummated, the Company hereby agrees to
reimburse Empire, within ten (10) days after
<PAGE>
Written request
therefore,
all reasonable travel and other out-of-pocket
expenses incurred
in connection with Empire's engagement, including the
reasonable fees and
expenses of Empire's
counsel but which
shall he capped at
$5,000. The Company shall also be responsible for ordering up to
ten (10) Lucite
deal tombstones
and shall release a press release at the conclusion of the
transaction that shall be reviewed and approved by Empire.
3.
Warrants: In addition to the Placement Agent's Fee, upon the
closing of
the sale of securities in connection with the Offering,
the Company shall
issue
to the Placement
Agent warrants to purchase shares of common stock of the
Company (the
"Warrants")
in an amount
ten percent (100%) of the amount of
Securities issued or issuable by the Company in the Offering. The
Warrants shall
be exercisable at 120%
of the Offering Price or at the market price on the date
of signing this
agreement, whichever
is lower. The Warrants
shall expire five
years from the
date of issuance. The Warrants shall be in the same form,
including, without
limitation,
the same registration
rights and anti-dilution
provisions, as the
securities
sold in the
Offering; provided however, the
Warrants shall include a "net issuance" exercise feature.
B.
No-Shop. Until the
Offering contemplated
hereby is completed,
but no
later than 180 days from the date hereof (the "No-Shop Period"), the Company
agrees that it will not negotiate with any other person relating to a possible
public or private offering or placement of the Company's
securities.
C. Term
and Termination of Engagement. Except as set form below, the
term
(the Term") of Empire's engagement will begin on die date
hereof and end on the
earlier of the
consummation of due
Offering or 20 days after receipt by cither
Party hereto of written notice of termination; provided that no such notice
may
be given by the
Company during the No
Shop Period.
Notwithstanding
any such
expiration or
termination,
Paragraphs D through N
shall survive and remain in
full force and effect and be binding on the parties hereto, in accordance with
their terms.
D. Fie
Tail. Empire shall be entitled to a Placement Agent's Fee,
calculated in the manner provided in Paragraph A, with respect to
any securities
purchased in any subsequent offering ("Subsequent Offering") by investors whom
Empire bad introduced to the Company during the Term if such
Subsequent Offering
is consummated
at any time within (i) the 24-month period following the
consummation of
this Offering and (ii), if no Offering shall have been
consummated during the
Term, the six month
period following the
expiration or
termination of this Agreement.
E. Future
Transactions,
If, at any time
during the Tern,
or within the
24-month period
following consummation of the Offering during the Term, the
Company or any of its subsidiaries (i) disposes of or acquires
business units or
acquires any of its outstanding securities or makes any exchange or
tender offer
or enters into a merger, consolidation or other business combination or any
recapitalization,
reorganization,
restructuring or other similar transaction,
including, without
limitation, an
extraordinary dividend
or distribution or a
spin-off or split-off (each, a "Transaction"), and the Company
decides to retain
a financial advisor for such Transaction, Empire shall have the right to act
as
one of the Company's
financial advisors for any such Transaction; or (ii)
decides to finance
or refinance any indebtedness using a manager or agent,
Empire (or any affiliate designated by Empire) shall have
the right to act as a
manager, placement
agent or lead
agent with respect to such financing or
refinancing- or (iii) determines to raise funds by means of a
public offering or
a Offering of equity or debt securities using an underwriter or
placement agent,
Empire shall
have the right to act
as an underwriter,
initial purchaser or
placement agent for such financing. In each case where Empire so
serves, Empire
shall be entitled
to at least one third
of the total fees paid
in connection
with the foregoing
transactions. If
Empire or its affiliates decides to accent
any such engagement, the agreement governing such engagement
will
2
<PAGE>
Contain, among other
things, provisions for
customary fees for Transactions of
similar size
<<fid
nature and the
provisions
of this Agreement, including
indemnification, which are appropriate to such Transaction.
F. Use of
information.
The Company
will furnish Empire such written
information as Empire reasonably requests in connection with die
performance of
its services hereunder. The Company understands,
acknowledges and
agrees that,
in performing
its services
hereunder,
Empire will use and
rely entirely upon
such information as Well as publicly available information
regarding the Company
and other potential
parties to an
Offering and that Empire docs not assume
responsibility for
independent
verification of the accuracy or completeness of
any information,
whether publicly available or otherwise furnished to it,
concerning the Company or otherwise relevant to an Offering,
including, without
limitation, any
financial information,
forecasts or
projections considered by
Empire in connection with the provision of its services.
G.
Confidentiality,
In the event of the consummation or public
announcement of any
Offering, Empire shall have the right to disclose its
participation in such Offering, including, without limitation, the
placement at
its cost of
"tombstone"
advertisements in
financial and other
newspapers and
journals. Empire
agrees to Steep
confidential
during die Term,
and for five
years after the expiration or any termination, of this Agreement, all material
nonpublic information provided to it by the Company, except as required by law,
pursuant to an order of a court of competent jurisdiction or the request of a
regulatory authority
having jurisdiction over Empire or its affiliate* (a
"Regulatory Request"*,
or as contemplated by the terms of this Agreement,
provided Empire
shall, if permitted by law, give notice
to the Company of the
request or order
(other than a
Regulatory Request)
to furnish the
nonpublic
information.
Notwithstanding any
provision herein to the contrary, Empire may
disclose nonpublic
information to its affiliates, agents and advisors whenever
Empire determines
that such disclosure is necessary to provide the
services
contemplated
hereunder, provided
that Empire advises such persons of the
obligation to maintain
the confidentiality of such information and remains
liable under
this Agreement for any breach of confidentiality by such
affiliates, agents and
advisors.
Notwithstanding any
provision herein to
the
contrary, this Section G shall not bar disclosure of, and Empire
and the Company
and their respective
representatives or agents may disclose, without limitation
of any kind, any
information
with respect to the *1ax treatment" and "tax
structure" (in each
case, within the
meaning of Treasury
Regulation
Section
1.6011 -4) of the Offering and related transactions and ail materials of any
kind (including
opinions or other tax
analyses) that are provided to Empire or
the Company or such representatives or agents relating to such tax
treatment and
tax structure,
provided that with respect to any document or similar item,
this
sentence shad only
apply to such portions
of the document or similar item that
relate to the tax treatment or tax structure of the
Transactions.
H.
Securities
Matters. The Company shall be responsible
for any and ail
compliance with the securities laws applicable to it, including
Regulation D and
the Securities Act of
1933, and Rule 506
promulgated there
under, and unless
otherwise agreed in
writing, all state
securities
("blue sky") laws.
Empire
agrees to cooperate with counsel to the Company in that regard.
I.
Indemnity.
Empire and the Company agree to the indemnification
provisions as set forth In annex A attached hereto.
J.
Limitation of Engagement to the Company. The Company acknowledges that
Empire has been retained only by the Company, that Empire is providing
services
hereunder as an
independent
contractor
(and not in any
fiduciary
