Exhibit 4.4
SILVER STAR ENERGY,
INC.
PLACEMENT AGENT
AGREEMENT
Dated
as of: November 24,
2004
Monitor Capital
Inc.
9171 Towne Centre Drive,
Suite 465
San Diego, CA
92122
Ladies and
Gentlemen:
The undersigned, Silver Star Energy, Inc., a Nevada 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 U.S. Dollars
($10,000,000) of the Company's common stock (the " Commitment
Amount "), par value US$0.001 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 or to be issued in connection with the
conversion of any debentures are sometimes referred to hereinafter
as the " Securities ." The Placement Agent shall not be
obligated to sell any Securities.
2. Compensation .
A. 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
U.S. Dollars (US$10,000) divided by the volume weighted average
price of the Company's Common Stock, as quoted by Bloomberg, LP, on
the date hereof (the " Placement Agent's Shares "). The
Placement Agent shall be entitled to "piggy-back" registration
rights, which shall be triggered upon registration of any shares of
Common Stock by the Investor with respect to the Placement Agent's
Shares 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 applicable to the Placement Agent generally and
applicable to the Placement Agent's participation in the
Offering.
4. Representations and Warranties of the
Company .
A. The
Company represents and warrants 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 has
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, the Standby Equity Distribution
Agreement and the Compensation Debenture, 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.
(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 is
validly existing as a corporation in good standing under the laws
of the State of Nevada. 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 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 and the
securities offered pursuant to the Securities Purchase Agreement
dated the date hereof, 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 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
supplement thereto nor any documents prepared by the Company in
connection with the Offering will contain any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not
misleading. All statements of material facts in the Offering
Materials are true and correct as of the date of the Offering
Materials.
(xiv) All material taxes which are due and
payable from the Company have been paid in full or adequate
provision has been made for such taxes on the books of the Company
except for those taxes disputed in good faith by the
Company
(xv) None of the Company nor any of its officers,
directors, employees or agents, nor any other person acting on
behalf of the Company, has, directly or indirectly, given or agreed
to give any money, gift or similar benefit (other than legal price
concessions to customers in the ordinary course of business) to any
customer, supplier, employee or agent of a customer or supplier, or
official or employee of any governmental agency or instrumentality
of any government (domestic or foreign) or any political party or
candidate for office (domestic or foreign) or other person who is
or may be in a position to help or hinder the business of the
Company (or assist it in connection with any actual or proposed
transaction) which (A) might subject the Company to any damage or
penalty in any civil, criminal or governmental litigation or
proceeding, or (B) if not given in the past, might have had a
materially adverse effect on the assets, business or operations of
the Company as reflected in any of the financial statements
contained in the Offering Materials, or (C) if not continued in the
future, might adversely affect the assets, business, operations or
prospects of the Company in the future.
5. Representations, Warranties and Covenants
of the Investor .
A. The Investor represents, warrants and
covenants as follows:
(i) &
