[RODMAN & RENSHAW LOGO]
14 December 2006
STRICTLY CONFIDENTIAL
Mr Patrick Kealy
President and Chief Executive Officer
Star Energy Corporation
245 Park Avenue
24th & 39th Floors
New York, NY 10167
Dear Mr Kealy:
This
letter (the "Agreement") constitutes the agreement between Star
Energy Corporation (the "Company") and Rodman & Renshaw, LLC
("Rodman") that
Rodman shall serve as the exclusive placement agent (the
"Services") for the
Company, on a "best efforts" basis, in connection with $20 million
of the
proposed $30 million offer and placement (the Offering") by the
Company of
securities of the Company (the "Securities").
The terms
of the Offering and the Securities shall be a unit of Common
Stock in the Company at $2.00 along with a warrant exercisable at
$3.50 for a
unit of Common Stock in the Company. It is the intention of the
parties to the
Agreement to complete the Offering on or before 15, January 2007.
The Company
expressly acknowledges and agrees that Rodman's obligations
hereunder are on a
reasonable best efforts basis only and that the execution of this
Agreement does
not constitute a commitment by Rodman to purchase the Securities
and does not
ensure the successful placement of the Securities or any portion
thereof or the
success of Rodman with respect to securing any other financing on
behalf of the
Company.
A. Fees
and Expenses. In connection with the Services described above,
the
Company shall pay to Rodman the following compensation:
1. Placement Agent's Fee. The Company shall pay to Rodman a
cash
placement fee (the "Placement Agent's Fee") equal to 7% of the
aggregate
purchase price paid by each purchaser of Securities that are placed
in the
Offering.
2. Warrants. As additional compensation for the Services, the
Company shall issue to Rodman or its designees at the closing of
the Offering
(the "Closing"), warrants (the "Rodman Warrants") to purchase that
number of
shares of common stock of the Company ("Shares") equal to 7% of the
aggregate
number of Shares placed in the Offering, plus any Shares underlying
any
convertible Securities sold in the Offering. The Rodman Warrants
shall have the
same terms, including exercise price and registration rights as the
warrants
issued to investors ("Investors") in the Offering. If no warrants
are issued to
Investors, the Rodman Warrants shall have an exercise price equal
to 120% of the
price at which Shares are issued to Investors, an exercise period
of five years
and registration rights for the Shares underlying the Rodman
Warrants equivalent
to those granted with respect to the Shares.
3. Expenses. In addition to any fees payable to Rodman
hereunder,
but only if an Offering is consummated, the Company hereby agrees
to reimburse
Rodman for all reasonable travel and other out-of-pocket expenses
incurred in
connection with Rodman's engagement, including the reasonable fees
and expenses
of Rodman's counsel. Such reimbursement shall be limited to $25,000
without
prior written approval by the Company.
1270 Avenue of the Americas, 16th Floor
New York, NY 10020
<PAGE>
B. Term
and Termination of Engagement. The term (the "Term") of
Rodman's
engagement will begin on the date hereof and end on the earlier of
the
consummation of the Offering or 15 days after the receipt by either
party hereto
of written notice of termination; provided that no such notice may
be given by
the Company for a period of 180 days after the date hereof.
Notwithstanding
anything to the contrary contained herein, the provisions
concerning
confidentiality, indemnification, contribution and the Company's
obligations to
pay fees and reimburse expenses contained herein will survive any
expiration or
termination of this Agreement.
C. Fee
Tail. Rodman shall be entitled to a Placement Agent's Fee and
Rodman Warrants, calculated in the manner provided in Paragraph A,
with respect
to any subsequent public or private offering or other financing
or
capital-raising transaction of any kind ("Subsequent Financing") to
the extent
that such financing or capital is provided to the Company by
investors whom
Rodman had introduced, directly or indirectly, to the Company
during the Term,
if such Subsequent Financing is consummated at any time within the
18-month
period following the expiration or termination of this Agreement
(the "Tail
Period").
D. Use of
Information. The Company will furnish Rodman such written
information as Rodman reasonably requests in connection with the
performance of
its services hereunder. The Company understands, acknowledges and
agrees that,
in performing its services hereunder, Rodman 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 Rodman does 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
Rodman in connection with the provision of its services.
E.
Confidentiality. In the event of the consummation or public
announcement of any Offering, Rodman 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. Rodman agrees not to use any confidential information
concerning the
Company provided to Rodman by the Company for any purposes other
than those
contemplated under this Agreement.
F.
Securities Matters. The Company shall be responsible for any and
all
compliance with the securities laws applicable to it, including
Regulation D and
the Securities Act of 1933, and Rule 506 promulgated thereunder,
and unless
otherwise agreed in writing, all state securities ("blue sky")
laws. Rodman
agrees to cooperate with counsel to the Company in that regard.
G. Company
Acknowledgement. The Company acknowledges that the Offering of
convertible Securities may create significant risks, including the
risk that the
Company may have insufficient cash resources and/or registered
shares to timely
meet its payment and conversion obligations. The Company further
acknowledges
that, depending on the number and price of new shares issued, such
transaction
may result in substantial dilution which could adversely effect the
market price
of the Company's shares.
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<PAGE>
H.
Indemnity.
1. In connection with the Company's engagement of Rodman as
placement agent, the Company hereby agrees to indemnify and hold
harmless Rodman
and its Affiliates, and the respective controlling persons,
directors, officers,
shareholders, agents and employees of any of the foregoing
(collectively the
"Indemnified Persons"), from and against any and all claims,
actions, suits,
proceedings (including those of shareholders), damages, liabilities
and expenses
incurred by any of them (including the reasonable fees and expenses
of counsel),
(collectively a "Claim"), which are (A) related to or arise out of
(i) any
actions taken or omitted to be taken (including any untrue
statements made or
any statements omitted to be made) by the Company, or (ii) any
actions taken or
omitted to be taken by any Indemnified Person in connection with
the Company's
engagement of Rodman, or (B) otherwise relate to or arise out of
Rodman's
activities on the Company's behalf under Rodman's engagement, and
the Company
shall reimburse any Indemnified Person for all expenses (inclu
