RPO Advisor Agreement between Diomed Inc. and Verus Support Services Inc. (December 2001)

Summary

Diomed Inc. has engaged Verus Support Services Inc. as its exclusive RPO advisor to assist with a merger involving a public company and a private placement. Verus will help coordinate the transaction, identify partners, advise on structure, and support negotiations. In return, Verus will receive a $750,000 fee, payable in cash or equity, depending on the transaction outcome. The agreement is effective from July 1, 2001, and lasts until the earlier of one year or the closing of a $5 million financing. Both parties agree to confidentiality and indemnification terms.

EX-10.1 3 dex101.txt RPO ADVISOR AGREEMENT Exhibit 10.1 Confidential - ------------ December 21, 2001 Peter Klein Chief Executive Officer Diomed Inc. One Dundee Park Andover, MA 01810 Dear Peter: Pursuant to our discussions, we are pleased to confirm the arrangements under which Verus Support Services Inc. ("Verus") is engaged by Diomed Inc. ("Diomed" or the "Company") to act as the Company's RPO advisor to assist and support in the Company's efforts to merger with a public company in transaction which includes a private placement, ("RPO Transaction"). 1. Verus will act as a RTO Advisor as specified below: o Coordinate and assist the Company in preparing itself for a combined financing and merger transaction, o Identify potential partners, advisors and lead investors who will be able to contribute to the Transaction, o Advise the Company as to the timing, structure and pricing, o Assist the Company in negotiations between various parties, o Assist in preparation of Investor materials and related presentations, o Coordinate the activities of professional advisors and the drafting of documents, o Provide referrals for after market support and placement activities. The parties agree that significant past services have been provided under a verbal agreement and that The "Effective Date" of this agreement shall be July 1, 2001. For acting as the RPO advisor the Company shall pay Verus a fixed fee of $750,000. This fee shall be paid in cash from proceeds in the RPO Closing escrow. Should the RPO not close by March 31, 2002 and an alternative financing is pursued, Diomed may elect to pay the Advisory fee in the form of common stock ( based on the alternative financing terms) or cash on closing the alternative financing Verus may at its election and with consent of the Company take up to 33% of its fee in equity of the Company on terms equivalent to the Private Placement. 2. The term of the engagement to act as the Company's exclusive RPO advisor shall be for the period from the Effective Date to the earlier of one year or the Closing of an RPO or other financing of a minimum of $5 million. Verus may terminate the engagement hereunder at any time, with or without cause, by giving the Company at least 30 days prior written notice and the terms and conditions herein, except the indemnification and confidentiality provisions which shall survive. If Verus terminates the agreement prior to one year or a RTO or other financing event its compensation shall be restricted to the lesser of $750,000 or its documented legal, travel, and other directly related expenses incurred on behalf of the Transaction. 3. In connection with Verus' activities on the Company's behalf, Diomed will furnish Verus with all information which it may reasonably request and will provide Verus access to the officers, directors, accountants and counsel of Diomed. Diomed acknowledges that in rendering its services hereunder, Verus shall be solely using and relying on the information provided by the Company. Verus does not assume responsibility for the accuracy or completeness of any information. Any advice rendered by Verus pursuant to this agreement may not be disclosed publicly without its prior written consent. 4. The Company agrees that Verus has the right to place advertisements in financial and other newspapers and journals describing its services to the Company hereunder upon review and approval by the Company. 5. Verus will act under this letter agreement as an independent contractor with duties to the Company. Because Verus will be acting on the Company's behalf in this capacity, it is Verus' practice to receive indemnification. A copy of Verus' standard indemnification form is attached to this letter. 6. Verus and Diomed mutually agree that they will not disclose any confidential information received from the other party to others except with the written permission of the other party or as such disclosure may be required by law. 7. This agreement shall be governed by and construed in accordance with the laws of the State of New York applicable to contracts executed in and to be performed in that state. If the terms of our engagement as set forth in this letter are satisfactory to you, kindly sign and date the enclosed copy of this letter and indemnification form and return it. Very truly yours, VERUS SUPPORT SERVICES INC. By: /s/ Ajmal Khan Ajmal Khan Chief Executive Officer ACCEPTED AND AGREED TO as of the date hereof December 24, 2001. DIOMED INC. By: /s/ Peter Klein Peter Klein Chief Executive Officer December 24, 2001 Verus Support Services Inc. 520 Madison Ave. New York, NY 10022 Gentlemen: This letter will confirm that we have engaged Verus Support Services Inc. to advise and assist us in connection with the matters referred to in our RPO Adviser agreement dated December 21, 2001 (the "Engagement Letter"). In consideration of your agreement to act on our behalf in connection with such matters, we agree to indemnify and hold harmless you and your affiliates and you and their respective officers, directors, employees and agents and each other person, if any, controlling you or any of your affiliates (you and each such other person being an "Indemnified Person") from and against any losses, claims, damages or liabilities related to, arising out of or in connection with the engagement (the "Engagement") under the Engagement Letter, and will reimburse each Indemnified Person for all expenses (including fees and expenses of counsel) as they are incurred in connection with investigating, preparing, pursuing or defending any action, claim, suit, investigation or proceeding related to, arising out of or in connection with the Engagement, whether or not pending or threatened and whether or not any Indemnified Person is a party. We will not, however, be responsible for any losses, claims, damages or liabilities (or expenses relating thereto) that are finally judicially determined to have resulted from the bad faith or gross negligence of any Indemnified Person. We also agree that no Indemnified Person shall have any liability (whether direct or indirect, in contract or tort or otherwise) to us for or in connection with the Engagement except for any such liability for losses, claims, damages or liabilities incurred by us that are finally judicially determined to have resulted from the bad faith or gross negligence of such Indemnified Person. We will not, without your prior written consent, settle, compromise, consent to the entry of any judgment in or otherwise seek to terminate any action, claim, suit or proceeding in respect of which indemnification may be sought hereunder (whether or not any Indemnified Person is a party thereto) unless such settlement, compromise, consent or termination includes a release of each Indemnified Person from any liabilities arising out of such action, claim, suit or proceeding. No Indemnified Person seeking indemnification, reimbursement or contribution under this agreement will, without our prior written consent, settle, compromise, consent to the entry of any judgment in or otherwise seek to terminate any action, claim, suit, investigation or proceeding referred to in the preceding paragraph. If the indemnification provided for in the first paragraph of this agreement is judicially determined to be unavailable (other than in accordance with the third sentence of the first paragraph hereof) to an Indemnified Person in respect of any losses, claims, damages or liabilities referred to herein, then, in lieu of indemnifying such Indemnified Person hereunder, we shall contribute to the amount paid or payable by such Indemnified Person as a result of such losses, claims, damages or liabilities (and expense relating thereto) (i) in such proportion as is appropriate to reflect the relative benefits to you, on the one hand, and us, on the other hand, of the Engagement or (ii) if the allocation provided by clause (i) above is not available, in such proportion as is appropriate to reflect not only the relative benefits referred to in such clause (i) but also the relative fault of each of you and us, as well as any other relevant equitable considerations; provided, however, in no event shall your aggregate contribution to the amount paid or payable exceed the aggregate amount of fees actually received by you under the Engagement Letter. For the purposes of this agreement, the relative benefits to us and you of the Engagement shall be deemed to be in the same proportion as (a) the total value paid or contemplated to be paid or received or contemplated to be received by us or our shareholders, as the case may be, in the transaction or transactions that are the subject of the Engagement, whether or not any such transaction is consummated, bears to (b) the fees paid or to be paid to you under the Engagement Letter. The provisions of this agreement shall apply to the Engagement and any modification thereof and shall remain in full force and effect regardless of any termination or the completion of your services under the Engagement Letter. This agreement and the Engagement Letter shall be governed by and construed in accordance with the laws of the State of New York applicable to contracts executed and to be performed in that state. Very truly yours, DIOMED INC. By: /s/ Peter Klein Peter Klein Chief Executive Officer ACCEPTED AND AGREED TO as of the date of December 24, 2001. VERUS SUPPORT SERVICES INC. By: /s/ Ajmal Khan Ajmal Khan Chief Executive Officer