Josephberg Grosz & Co., Inc.
Investment Bankers
633 Third Avenue o New York, NY 10017
Tel: (212)974-9926 o Fax: (212) 397-5832
Dir: (646)485-3151 o e-mail: [email protected]
July 13, 2000
Janet Greeson, Ph.D.
President
Steroidogenesis Inhibitors International, Inc.
101 Convention Center Drive
Las Vegas, Nevada 89109
Dear Janet:
I. The purpose of this letter is to set forth the terms of our agreement
(the "Agreement") with respect to the compensation which Josephberg Grosz & Co.,
Inc. or their designees ("JGC") are to receive for assisting and advising
Steroidogenesis Inhibitors International, Inc. or related entities, direct or
indirect (the "Company"), in obtaining a capital infusion of equity, debt,
bridge financing, merger and acquisitions, letter or line of credit, lease
financing or other types of financial transactions, including any transactions
of financial value (the "Financing"). Our focus will be on providing the Company
with equity for working capital needs in the $5,000,000 range and acquisition
capital in the $15,000,000 range.
II. To assist the Company in obtaining Financing, the Company agrees to
engage JGC as its agent with respect to all Financing sources, direct or
indirect, (the "Investor") introduced by JGC. When such Financing from any
Investor introduced to the Company by JGC directly or indirectly, (other than a
Financing in the nature of one described in paragraphs III & IV below) is
provided, JGC will be compensated by the Company, in full, at the closing of the
Financing, by receiving a total fee of 8(6% cash; 2% stock), the fee due JGC
when received by the Company and equal to the total gross dollar value received
or to be received (including any form of equity, bridge, stock, warrant
conversion, convertible securities or subordinated debt Financing) by the
Company (i.e. $5,000,000 Financing provided; JG Capital, Inc. receives a cash
fee of 6%, to be $300,000 and a fee of 2% in the form of common stock of the
Company to JG Capital, Inc. at the same valuation, rights and price as the
Investor). In addition, JGC will have the right to invest in the Company by
receiving, at the closing of the Financing, a five year warrant. Such warrant
shall give JGC or its designees the right, at anytime over a five year period,
to purchase securities on a cashless basis in the Comapny equal to 10% of the
total shares issued to the Investor at the same price, the same type securities
and the same rights as the Investor (i.e. $5,000,000 Financing provided, JGC's
designees receive warrants to purchase shares of the same type securities and at
the same price and valuation as the Investor at the time of Financing at anytime
over a five year period). Any and all securities and/or warrants and securities
underlying such warrants to be received by JGC and its designees shall have
appropriate piggy-back and registration rights and in any case become free
trading immediately following 144 holding period.
III. For senior debt, credit facilities, guarantees; lease financing and
letter or line of credit Financing, JGC's cash fee, if such is provided by an
Investor introduced by JGC, and accepted by the Company, shall be 3.0% of the
total dollar value received by the Company.
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Page 2 of 3
IV. In the event the Company enters into a merger, acquisition or joint
venture with an Investor or entity introduced by JGC or entities or Investors
negotiated with on behalf of the Company by JGC, JGC will be compensated by the
Company, in full, at the closing thereof, in accordance with the 5/4/3 Formula,
(i.e. by receiving a cash fee of 5% of the first $1,000,000 of Value received by
the Company or the Investor, wichever is applicable, 4% of the second
$1,000,000, and 3% of all Value received in excess of $2,000,000). While not all
inclusive, Value shall include total cash, notes, debt, stock, consulting,
non-compete, earn-out, sales and royalty agreements.
V. The fees in paragraphs II, III and IV above are totally independent of
one another and are based upon the type or types of transactons JGC arranges.
VI. Upon the execution of this Agreement the Compnay agrees to pay JG
Capital, Inc. an engagement fee equal to $25,000 with shares of the Company's
common stock and cash.
VII. This Agreement may be terminated or amended by the Company sixty days
from the signing of this Agreement or anytime thereafter with ten days prior
written notice. Termination of this Agreement shall not release the Company of
its obligation to compensate JGC or its designees for its services rendered
including the completion of the Financing as it relates to this Agreement,
including paragraphs two, three and four. In other words, JGC shall be
compensated if any party introduced to the Company by JGC directly or
indirectly, per paragraphs II, III and IV, enters into a transaction or provides
Financing as long as the transaction (transactions) or Financing (Financings)
was provided or committed to by those parties within 24 months after termination
of this Agreement.
VIII. It is understood and agreed that you shall have the right to accept or
reject in your judgement the terms of any Financing or transaction proposed by
any Financing Sources, Investors, strategic partners and/or corporations
presented to you. If such Financing is provided by the Investor to the Company
and accepted, as a condition to the closing, the Company agrees to represent to
JGC, to the Investor and the Company's and Investors attorneys prior to the
closing of the transaction or Financing that the cash portion of the fees due
and payable to JGC as they apply to this Agreement will be paid to JGC by wire
transfer or certified check at the closing of the transaction and/or Financing
along with any and all othe fees due JGC (stock, etc.). The Company also agrees
to copy JGC promptly on all correspondence between all prospective Investors and
the Company and provide a copy of all closing documents to JGC at closing.
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IX. This Agreement shall be governed and construed in accordance with the
laws of the State of New York. In the event of any dispute between us regarding
the subject matter of this Agreement, such dispute shall be submitted to
arbitration before a single arbitrator in New York City in accordance with the
rules of the American Arbitration Association. Any decision or award shall be
final and binding upon the parties hereto. All legal fees, arbitration fees,
filing fees, collection fees, expenses and the maximum interest rate allowed by
law shall be paid to the prevailing party by the losing party. If you are in
Agreement to the foregoing, please sign and date below.
Sincerely,
Josephberg Grosz & Co., Inc.
By: /s/ Richard A. Josephberg July 19, 2000
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Richard A. Josephberg Date
Chairman
AGREED AND ACCEPTED:
Steroidogenesis Inhibitors International, Inc.
By: /s/ Janet Greeson July 19, 2000
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Janet Greeson, Ph.D. Date
President
