EXHIBIT
10.3
EGPI Firecreek,
Inc.
PLACEMENT AGENT
AGREEMENT
Dated as of: June 28,
2005.
The undersigned, EGPI
Firecreek Inc., a Nevada corporation (the "COMPANY"), hereby agrees
with U.S. Euro Securities (the "PLACEMENTAGENT") and Dutchess
Private Equities Fund II, L.P., 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 Investment Agreement dated
June 17, 2005 (the "INVESTMENT 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 Twenty-Five Million Dollars ($25,000,000) of the
Company's Class A Voting Common Stock (the "COMMITMENT AMOUNT"),
par value $0.001 per share (the "COMMON STOCK"), at price per share
equal to the Purchase Price, as that term is defined in the
Investment Agreement. Pursuant to the terms hereof, the Placement
Agent shall render consulting services to the Company with respect
to the Investment Agreement and shall be available for consultation
in connection with the advances to be requested by the Company
pursuant to the Investment Agreement. All capitalized terms
used herein and not otherwise defined herein shall have the same
meaning ascribed to them as in the Investment Agreement. The
Investor will be granted certain registration rights with respect
to the Common Stock as more fully set forth in a Registration
Rights Agreement between the Company and the Investor dated June
17, 2005 (the "REGISTRATION RIGHTS AGREEMENT"). The documents to be
executed and delivered in connection with the Offering, including,
but not limited, to this Agreement, the Investment Agreement, and
the Registration Rights Agreement, and any Prospectus or other
disclosure document ( including all amendments and supplements )
utilized in connection with the Offering are referred to sometimes
hereinafter collectively as the "OFFERING MATERIALS." The Company's
Common Stock is sometimes referred to hereinafter as the
"SECURITIES." The Placement Agent shall not be obligated to sell
any Securities and this Offering by the Placement Agent shall be
solely on a "best efforts basis."
2.
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
2
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 take any action that it reasonably believes would cause the
Offering to violate the provisions of the Securities Act of 1933,
as amended (the "1933 ACT"), the Securities Exchange Act of 1934
(the "1934 ACT"), the respective rules and regulations promulgated
there under (the "RULES AND REGULATIONS") or applicable "Blue Sky"
laws of any state or jurisdiction.
(v)
The Placement Agent will
use all reasonable efforts to determine (a) whether the Investor is
an Accredited Investor and (b) that any information furnished by
the Investor is true and accurate. The Placement Agent shall
have no obligation to insure that (x) any check, note, draft or
other means of payment for the Common Stock will be honored, paid
or enforceable against the Investor in accordance with its terms,
or (y) subject to the performance of the Placement Agent's
obligations and the accuracy of the Placement Agent's
representations and warranties hereunder, (1) the Offering is
exempt from the registration requirements of the 1933 Act or any
applicable state "Blue Sky" law or (2) the Investor is an
Accredited Investor.
(vi)
The Placement Agent is a
member of the National Association of Securities Dealers, Inc., and
is a broker-dealer registered as such under the 1934 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 compliance with all material rules and
regulations applicable to the Placement Agent generally and
applicable to the Placement Agent's participation in the
Offering.
3.
REPRESENTATIONS AND
WARRANTIES OF THE COMPANY.
A. The Company makes to
the Placement Agent all the representations and warranties it makes
to the Investor in the Investment Agreement and, in addition,
represents and warrants as follows:
(i)
The execution, delivery
and performance of each of this Agreement, the Investment Agreement
and the Registration Rights Agreement has been or will be duly and
validly authorized by the Company and is, and with respect to this
Agreement, the Investment Agreement and the Registration Rights
Agreement will each 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
Investment Agreement have been
3
duly authorized and,
when issued and paid for in accordance with (x) this Agreement, the
Investment Agreement and the certificates/instruments representing
such Securities, (y) 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 Investment Agreement. Other than Publicly
available filings and Periodic Filings and Reports, 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 Investment
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. As of June
28, 2005, the authorized capital stock of the Company consists of
(i) 900,000,000 shares of Common Stock, par value $.001 per share,
of which approximately 110,549,030 shares are issued and
outstanding, 133,333,000 shares are initially reserved for issuance
in behalf of Tirion Group, Inc.; and (ii) 20,000,000 shares of
non voting Common Stock, par value .001 per share, of which no
shares are issued and outstanding, (iii) 60,000,000 shares of
Preferred stock, par value $.001 per share, of which 2,566,831
Preferred A, 9,500,000 Preferred B, and 900,000 Preferred C are
issued and outstanding. There are options granted totaling
approximately 20,800,000, of which 17,000,000 are available for
exercise at $.70 and 3,800,000 at $.95 per share, respectively.
There are 2,000,000 shares designated/reserved for issuance
pursuant to warrants held by Tirion Group, Inc.; 6,700,000 shares
designated/reserved for issuance pursuant to warrants held by DLM
Asset Management; 2,500,000 to Sapphire Consultants; 250,000 shares
designated /reserved for issuance pursuant to warrants held by John
Brigandi. Other than that disclosed in the Company’s
historical or ongoing publicly available filings with Periodic
Filings and Reports there are no shares reserved for issuance
pursuant to options, warrants, and other convertible
securities.
(iii)
The Common Stock to be
issued in accordance with this Agreement and the Investment
Agreement has been duly authorized and when issued and paid for in
accordance with this Agreement, the Investment Agreement and 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.
4.
REPRESENTATIONS, WARRANTIES AND
COVENANTS OF THE INVESTOR.
A.
The Investor makes to
the Placement Agent all the representations and warranties it makes
to the Company in the Investment Agreement and, in addition
represents, warrants and covenants as follows:
4
(i)
The Investor has the
necessary power to enter into this Agreement and to consummate the
transactions contemplated hereby.
(ii)
The execution and
delivery by the Investor of this Agreement and the consummation of
the transactions contemplated herein will not result in any
violation of, or be in conflictwith, or constitute a default under,
any agreement or instrument to which the Investor is a party or by
which the Investor or its properties are bound, or any judgment,
decree, order or, to the Investor's knowledge, any statute, rule or
regulation applicable to the Investor. This Agreement when executed
and delivered by the Investor, will constitute the legal, valid and
binding obligations of the Investor, 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) the Investor is
not, and will not be, as a result of the transactions
contemplated by the Offering Materials a “dealer”
within the meaning of the Securities Exchange Act of 1934 and
applicable federal and state securities laws and regulations. The
Investor covenants that in this respect it is and will remain in
compliance with the requirements of applicable “no
action” rulings of the U.S. Securities Exchange
Commission.
(iv)
The Investor will
promptly forward copies of any and all due diligence questionnaires
compiled by the Investor to the Placement Agent.
5.
CERTAIN COVENANTS AND
AGREEMENTS OF THE COMPANY.
The Company covenants
and agrees at its expense and without any expense to the Placement
Agent as follows:
A.
To advise the Placement
Agent of any material adverse change in the Company's financial
condition, prospects or business or of any development materially
affecting the Company or rendering untrue or misleading any
material statement in the Offering Materials occurring at any time
as soon as the Company is either informed or becomes aware
thereof.
B.
To use its commercially
reasonable efforts to cause the Common Stock issuable in connection
with the Equity Line of Credit to be qualified or registered for
sale on terms consistent with those stated in the Registration
Rights Agreement and under the securities laws of such
jurisdictions as the Placement Agent and the Investor shall
reasonably request. Qualification, registration and exemption
charges and fees shall be at the sole cost and expense of the
Company.
C.
Upon written request, to
provide and continue to provide the Placement Agent and the
Investor copies of all quarterly financial statements and audited
annual financial statements prepared by or on behalf of the
Company, other reports prepared by or on behalf of the Company for
public disclosure and all documents delivered to the Company's
stockholders.
D.
To deliver, during the
registration period of the Investment Agreement, to the Placement
Agent upon the Placement Agent's request,
(i)
within forty five (45)
days, a statement of its income for each such quarterly period, and
its balance sheet and a statement of changes in stockholders'
equity as of the end of
5
such quarterly period,
all in reasonable detail, certified by its principal financial or
accounting officer;
(ii)
within ninety (90) days
after the close of each fiscal year, its balance sheet as of the
close of such fiscal year, together with a statement of income, a
statement of changes in stockholders' equity and a statement of
cash flow for such fiscal year, such balance sheet, statement of
income, statement of changes in stockholders' equity and statement
of cash flow to be in reasonable detail and accompanied by a copy
of the certificate or report thereon of independent auditors if
audited financial statements are prepared; and
(iii)
a copy of all documents,
reports and information furnished to its stockho
