Exhibit 10.14


 


STIFEL


NICOLAUS


 


June 1, 2007


 


PERSONAL AND CONFIDENTIAL


 


Mr. A. J. Piscitelli 

Chief Executive Officer 

American Defense Systems, Inc. 

230 Duffy Avenue 

Unit C 

Hicksville, NY 11801


 


Dear Mr. Piscitelli:


 


Reference is made to that
certain engagement letter agreement dated August 8, 2006 between Stifel,
Nicolaus & Company, Incorporated (“Stifel Nicolaus”) and American
Defense Systems, Inc. (the “Prior Agreement”). This letter agreement (this
“Agreement”) is intended to and shall supersede the Prior Agreement and, upon
execution of this Agreement, the Prior Agreement will terminate and be of no
further force and effect with the exception of Section II(F) and the
related Attachment A thereof which will survive such termination of the Prior
Agreement.


 


American Defense Systems, Inc.
(together with any present and future subsidiaries and affiliates of American
Defense Systems, Inc., the “Company”) hereby engages Stifel Nicolaus to
act as: (a) financial advisor and exclusive financing agent for the
Company in seeking, arranging, negotiating and generally advising with respect
to the placement, in one or a series of transactions, of equity and/or debt
securities (such transaction or transactions, the “Financing”) and (b) the
Company’s sole and exclusive agent in connection with a potential “Sale” (as
defined below) of the Company.


 


I.              Services of Stifel Nicolaus


 


With respect to a Financing,
Stifel Nicolaus will endeavor to obtain one or more commitments for the
Financing (individually a “Commitment” and collectively the “Commitments”) from
one or more financial institutions or other sources (the “Investors”). The
major terms of the Financing which Stifel Nicolaus will seek to obtain will be
deemed acceptable to the Company as evidenced by the Company’s acceptance of a
Commitment. With respect to a Sale, Stifel Nicolaus will assist the Company in:
(i) identifying opportunities for the Sale of the Company; (ii) advising
the Company concerning opportunities for such Sale, whether or not identified
by Stifel Nicolaus; and (iii) as requested by the Company, participating
on the Company’s behalf in negotiations concerning such Sale. During the term
of the Agreement, Stifel Nicolaus will perform or cause one or more of its
affiliates to perform, and the Company 


 


 


 

















 


hereby
grants Stifel Nicolaus and its affiliates the exclusive right and authority to
perform, the following services:


 


1.             Assist the Company in the preparation of materials
(collectively, the “Documents”) that include select business and financial
information about the Company and a description of the proposed Financing
and/or Sale, as the case may be, with proposed terms and conditions, and other
relevant information as Investors or potential purchasers (“Purchasers”) may
request.


 


2.             Contact and seek to elicit interest from multiple
Investors or Purchasers to participate in the Financing or Sale, as the case
may be.


 


3.             Coordinate inquiries from and assist in the preparation
of additional Documents providing such information and analyses as may be
requested by Investors or Purchasers.


 


4.             Advise the Company as to the procedures to obtain
favorable Financing and/or consummate a Sale, and assist the Company in
evaluating and negotiating the terms and conditions of any Commitment or Sale.


 


5.             Assist the Company in closing a Financing or Sale.


 


II.            Representations, Warranties, Terms and Conditions


 


The Company hereby
represents and warrants to, and agrees with, Stifel Nicolaus as follows:


 


(A)          This Agreement has been duly
authorized and represents the legal, valid, binding and enforceable obligation
of the Company and that neither this Agreement nor the consummation of the
transactions contemplated hereby requires the approval or consent of any
governmental or regulatory agency or violates any law, regulation, contract or
order binding on the Company. The Company further represents and warrants that
the Company is in all respects qualified and authorized to accept the
Commitments being arranged by Stifel Nicolaus.


 


(B)           Stifel Nicolaus is hereby granted the
sole and exclusive right and authority to locate Financing sources, obtain
Commitments and contact Purchasers during the term of this Agreement. If the
Company accepts or otherwise enters into any Commitment or preliminary or
definitive agreement relating to a Sale during the term of this Agreement and
the Company closes the Financing under such Commitment or the Sale contemplated
by such agreement, whether or not such Financing, Commitment or Sale was
arranged through Stifel Nicolaus (although such closing may occur subsequent to
the expiration of this Agreement), the Company expressly agrees that Stifel
Nicolaus’ services have been fully performed as outlined herein, and the
Company shall pay Stifel Nicolaus compensation as outlined herein. In order that
the Company and Stifel Nicolaus can best 


 


 


 

















 


coordinate efforts to consummate a transaction
satisfactory to the Company, the Company agrees that it will not initiate or
engage in discussions relating to a Financing or a Sale during the term of this
Agreement except through Stifel Nicolaus; provided, however, that this
provision shall not limit the Company’s ability to engage in preliminary
discussions with any potential Investor(s) or Purchaser(s) that
contact the Company directly regarding a Financing or Sale, respectively, so
long as the Company promptly directs any such Investor(s) or Purchaser(s) to
Stifel Nicolaus for any substantive discussions or negotiations regarding a
Financing or Sale, as the case may be, and for inclusion on the List (as defined
below).


 


(C)           Stifel Nicolaus and the Company shall
jointly develop and maintain a list (the “List”) of potential Investors or
Purchasers with whom either Stifel Nicolaus or the Company has had contact with
respect to (i) a Sale of the Company over the past five years and/or (ii) any
Financing during the term of this Agreement; provided, however, that Stifel
Nicolaus will be allowed to include on the List those potential Investors that
were previously contacted regarding a Financing during the term of the Prior
Agreement. In this regard, the Company shall present to Stifel Nicolaus the
names of all potential Investors and/or Purchasers with whom the Company has
had contact with respect to a Financing or a Sale during the term of this
Agreement or during the term of the Prior Agreement and all such parties shall
be included on the List.


 


(D)          The Company will furnish Stifel
Nicolaus with all information and material concerning the Company, the
Financing and the Sale which Stifel Nicolaus reasonably requests in connection
with the performance of its obligations hereunder. The Company represents and
warrants, to the best of its knowledge after due inquiry, that all information
made available to Stifel Nicolaus by the Company or contained in the Documents
will, at all times during the period of the engagement of Stifel Nicolaus
hereunder, be complete and correct in all material respects and will not
contain any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein not misleading in light
of the circumstances under which such statements are made. The Company further
represents and warrants that any projections provided to Stifel Nicolaus or
contained in the Documents will have been prepared in good faith and will be
based upon assumptions which, in light of the circumstances under which they
are made, are reasonable. The Company acknowledges and agrees that in rendering
its services hereunder, Stifel Nicolaus will be using and relying upon, without
any independent investigation or verification thereof, all information that is
or will be furnished to Stifel Nicolaus by or on behalf of the Company and on
publicly available information, and Stifel Nicolaus will not in any respect be
responsible for the accuracy or completeness of any of the foregoing kinds of
information, and that Stifel Nicolaus will not undertake to make an independent
appraisal of any of the assets of the Company. The Company understands that in
rendering services hereunder Stifel Nicolaus does not provide accounting, legal
or tax advice and will rely upon the advice of counsel to the Company and other
advisors to the Company as to 


 


 

















 


accounting, legal, tax and other matters relating to a
Financing, a Sale or any other transaction contemplated by this Agreement.


 


(E)           In connection with engagements of the
nature covered by this Agreement, it is Stifel Nicolaus’ practice to provide
for indemnification, contribution, and limitation of liability. By signing this
Agreement, the Company agrees to the provisions attached to this Agreement
(Attachment A), which provisions are expressly incorporated by reference
herein.


 


(F)           The Company shall make or cause to be
made state “blue sky” applications in such states and jurisdictions as shall be
required by law in connection with the Financing. It shall be the Company’s
obligation to bear all blue sky counsel fees and expenses.


 


(G)           It is understood that the offer and
sale of the securities sold in the Financing (the “Securities”) will be exempt
from the registration requirements of the Securities Act of 1933, as amended
(the “Act”), pursuant to Section 4(2) thereof. The Company will not,
directly or indirectly, make any offer or sale of Securities or of securities
of the same or a similar class as the Securities if as a result the offer and
sale of Securities contemplated hereby would fail to be entitled to the
exemption from the registration requirements of the Act provided for in such Section 4(2).
The Company represents and warrants that it has not, directly or indirectly,
made any offers or sales of the Securities or securities of the same or similar
class as the Securities during the six month period ending on the date of this
letter, and has no intention of making an offer or sale of the Securities or
securities of the same or similar class as the Securities for a period of six
months after completion of the private placement contemplated hereby. As used
herein, the terms “offer” and “sale” have the meanings specified in Section 2(3) of
the Act.


 


(H)          In
connection with all offers and sales of the Securities the Company will:


 


(a)           not offer or sell the Securities by
means of any form of general solicitation or general advertising. The Company
will not at any time during the term of this engagement, or for a period of six
months following completion of the placement of Securities contemplated hereby,
make any reference publicly to the transactions contemplated hereby, by way of
the issuance of a press release, the placement of an advertisement or otherwise,
without the prior written consent of Stifel Nicolaus;


 


(b)           not offer or sell the Securities to
any person who is not an “accredited investor” as defined in Rule 501
under the Act; and


 


(c)           exercise reasonable care to ensure
that the purchasers of the Securities are not underwriters within the meaning
of Section 2(11) of the Act.


 


 

















 


I.              For the purposes of this Agreement:


 


 


(a)           A “Sale” of the Company shall mean
any transaction or series or combination of related transactions, other than in
the ordinary course of trade or business, whereby, directly or indirectly,
control of the Company or all or substantially all of its businesses (a
“Business”) or assets is transferred for Consideration, including, without
limitation, a sale or exchange of capital stock or assets, a lease of assets
with or without a purchase option, a merger or consolidation, a
recapitalization, a tender or exchange offer, a leveraged buy-out, or any
similar transaction. For purposes of the foregoing, “control” means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and business of the Company, whether through the
ownership of voting securities, by contract or otherwise.


 


(b)           Except as provided in subsection (c) below,
“Consideration” shall mean the full transaction value of any Sale of the
Company including, without limitation, the total value of all cash (including
any escrowed funds), securities, other property and any contingent, earned or
other consideration paid or payable, directly or indirectly, by an acquiring
party to a selling party or to a participant in the transaction in connection
with a Sale of the Company. The value of any such securities (whether debt or
equity) or other property or items of value shall be determined as follows: (i) the
value of securities that are freely tradeable in an established public market
shall be the 10 trading day trailing average of the closing market price of
such securities prior to the public announcement of the Sale; (ii) the
value of securities which are not freely tradeable or which have no established
public market, or if the Consideration utilized consists of property other than
securities, the value of such securities or other property shall be the fair
market value thereof (without any discount for minority interest or
non-marketability); and (iii) the sum of the present value of all lease
payments. Consideration shall also include the face value of any indebtedness
(except to trade creditors) to which the Sale of the Company is subject or to
which the Company (or portion thereof) to be sold remains obligated, or
indebtedness that is assumed in connection therewith, the value of any
consulting, severance or employment agreements received by the principals of
the Company in excess of 120% of their historical salary levels, the value of
any termination or break-up fees received by the Company, and the value of any
payments to be received by the principals of the Company for entering into
non-compete, no-shop, standstill or similar agreements. In the case of a
recapitalization, Consideration shall include the aggregate amount of
indebtedness incurred or equity raised by the Company or a successor thereof in
connection with such recapitalization. If a Sale of the Company is structured such
that it involves a direct or indirect transfer of more than half of the
outstanding equity interests in the Company, the Consideration involved in that
transaction shall be deemed increased to include the value of any equity
interests in the Company that are not transferred in the


 

















 


transaction by the owners thereof, with such value
calculated at the price or implied price per share paid for or with respect to
interests of the same class in the transaction (without any discount for
minority interest or for non-marketability). If any Consideration to be paid is
computed in a foreign currency, the value of such foreign currency shall, for
purposes hereof, be converted into U.S. Dollars at the prevailing exchange rate
on the date or dates on which such Consideration is paid.


 


(c)           If the Sale of the Company is
structured in such a way as to provide for the transfer of only part of the
assets of the Company or one or more of the Businesses of the Company and the
retention of other assets or Business(es), including, but not limited to, cash,
cash equivalents, investments, inventories and receivables, such retained
assets or Businesses shall be deemed to be part of the Consideration received
in connection with the Sale of the Company, as follows: (A) with respect
to investments, in an amount equal to the market value of such investments, (B) with
respect to inventories and receivables, in an amount equal to the book value
thereof, and (C) with respect to any other assets or Businesses, in an
amount to be reasonably determined by the parties.


 


III.           Compensation/Payment for Services Performed


 


In consideration for Stifel
Nicolaus’ services hereunder, the Company shall compensate Stifel Nicolaus as
follows:


 


(A)          The Company shall pay or cause Stifel
Nicolaus to be paid as follows:


 


(a)           In consideration of Stifel Nicolaus’
services pursuant to the Prior Agreement in connection with the Company’s
recently closed financing from Commerce Bank, a fee of $700,000, payable
immediately upon the execution of this Agreement provided that $400,000 of such
fee shall be credited against any  other
Placement Fee (as defined below) that may subsequently become payable pursuant
to subsection (b) below.


 


(b)           If a Financing occurs, or the Company
receives a Commitment in respect of such Financing, either:


 


(i)                                     during the term of Stifel Nicolaus’
engagement hereunder, regardless of whether the Investors in the Financing were
identified by Stifel Nicolaus or whether Stifel Nicolaus rendered advice
concerning the Financing, or


 


(ii)                                  at any time during a period of 12 months
following the effective date of termination of Stifel Nicolaus’ engagement
hereunder, and the Financing involves an Investor (or an affiliate of an
Investor) included (or which should have been included) on the List,


 


 

















 


then, upon closing of the
Financing, Stifel Nicolaus will be entitled to and the Company shall pay to
Stifel Nicolaus a placement fee (the “Placement Fee”) equal to (x) 7.0%
percent (700 basis points) of the amount of the equity portion of the
Financing, plus (y) 5.5% (550 basis points) of the subordinated debt
portion of the Financing, plus (z) 2.0% (200 basis points) of the senior
debt portion of the Financing; provided, however, that in the event of a sale
or transfer of equity securities by an existing shareholder(s) of the
Company to a third party that does not constitute a Sale of the Company (a
“Shareholder Financing”), the applicable Placement Fee shall be 2.0% (200 basis
points) of the aggregate gross proceeds received by the selling Company
shareholder(s) in connection with such Shareholder Financing. The
Placement Fee is due and payable to Stifel Nicolaus on the date of the first
closing or funding of the Financing; no Placement Fee shall be due and payable
unless and until a closing occurs.


 


(c)           Warrants to purchase a number of
shares of the same equity security of the Company as is issued in any equity
Financing (or a security with substantially identical terms) such that the
aggregate fair market value, as determined in the Financing, of the securities
purchasable under the warrants equals the Placement Fee (the “Warrants”);
provided, however, that no Warrants shall be issued to Stifel Nicolaus solely
in connection with a Shareholder Financing. The Warrants shall be earned as of,
and shall be issued to Stifel Nicolaus or its designated affiliates on, the
date of the first closing of the Financing and shall be exercisable at a price
of 100% of the price per share as established in the Financing. The Warrants
shall be for a term of 7 years and shall have standard anti-dilution rights for
stock splits, stock dividends or other 
distributions, subdivisions or combinations of stock, and mergers,
acquisitions, consolidations or other corporate reorganizations (but not future
financings), cashless exercise (as described below), “piggyback” registration
rights and such other provisions as are customary for warrants of this nature.
The term “cashless exercise” as used herein means the right to either (i) exercise
by delivering to the Company that number of securities of the Company having an
aggregate market value equal to the aggregate exercise price for the number of
securities for which the Warrants are being exercised, or (ii) receive
from the Company in exchange for the Warrants a number of securities of the
class covered by the Warrants having an aggregate market value equal to the
difference between the aggregate market value and exercise price of the
securities covered by the Warrants.


 


(d)           If a Sale of the Company occurs, or
the parties to a Sale reach a preliminary understanding or definitive agreement
in respect of such Sale, either:


 


(i)                  during the term of Stifel Nicolaus’ engagement
hereunder, regardless of whether the party or parties to the Sale were
identified by Stifel Nicolaus or whether Stifel Nicolaus rendered advice
concerning the Sale, or


 


 

















 


(ii)               at any time during a period of 12 months following the
effective date of termination of Stifel Nicolaus’ engagement hereunder, and the
Sale involves a party (or an affiliate of a party) included (or which should
have been included) on the List,


 


then, upon consummation of
the Sale, the Company shall pay to Stifel Nicolaus the greater of (X) $700,000
and (Y) the following percentages of the Consideration involved in the
Sale (the “Sale Fee”):


 


 




	
  Consideration

  	
   

  	
  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  On the first $50
  million

  	
   

  	
  2.00

  	
  %

  
	
  Plus on the next $50
  million

  	
   

  	
  3.00

  	
  %

  
	
  Plus on the amount over
  $100 million

  	
   

  	
  4.00

  	
  %

  






 


Notwithstanding
the foregoing, any transaction in which securities of the Company are issued
shall constitute a Financing and not a Sale of the Company.


 


(e)           Notwithstanding anything herein to
the contrary, any Sale Fee attributable to that part of the Consideration
involved in the Sale which is contingent upon future earnings or other
financial performance or the occurrence of some other event or circumstance
(“Contingent Consideration”) shall be paid by the Company to Stifel Nicolaus
upon the receipt of such Contingent Consideration.


 


(f)            If either the Placement Fee or the
Sale Fee is not fully paid when due or the Warrants are not issued as provided
in subsection (c) above, the Company agrees to pay all costs of collection
or other enforcement of Stifel Nicolaus’ rights hereunder, including but not
limited to reasonable attorneys’ fees and expenses, whether collected or
enforced by suit or otherwise. The Placement Fee and the Sale Fee are not
negotiable and are not subject to any reduction, set-off, counterclaim or
refund for any reason or matter whatsoever.


 


(g)           The Company hereby grants Stifel
Nicolaus a right of first refusal to act as the Company’s lead book-running
managing underwriter in the event the Company retains or otherwise uses (or
seeks to retain or use) the services of an investment bank or similar financial
advisor or underwriter to pursue at any time during the term of this Agreement
or within 18 months after the expiration or termination of this Agreement, a
registered, underwritten public offering of securities. Nothing contained
herein, however, constitutes an obligation of Stifel Nicolaus to serve as lead
book-running managing underwriter or in any other similar capacity.


 


(B)           The Company understands that an
Investor providing the Financing may be interested in providing other financing
for the benefit of the Company. The Company


 


 

















 


agrees to compensate Stifel Nicolaus in the same
manner and in the same percentage as the Placement Fee provided in Section III
(A) above of the amount of any financing from the Investor or any
affiliate of the Investor which, within 12 months from the expiration or
termination date of this Agreement, may be committed to or paid to the Company,
or to any other person or entity that currently is or hereafter may be owned by
or owning, or controlled by, controlling or under common control with the
Company.


 


(C)           In addition to the fees described in
Sections III(A) and III(B) above and the obligation of the Company to
pay certain expenses set forth in Section II(E) above, and whether or
not any Financing or Sale is consummated, the Company will pay all of Stifel
Nicolaus’ reasonable out-of-pocket expenses (including, without limitation,
expenses related to document and presentation materials, travel, external
database and communications services, courier and delivery services, and the
fees and expenses of its outside legal counsel) incurred in connection with
this engagement. Such out-of-pocket expenses shall be payable as they are
incurred upon request by Stifel Nicolaus.


 


IV.           Miscellaneous


 


(A)          The term of this engagement will
continue until the earlier of 12 months from the date hereof or until
terminated in the manner provided for in this Section. Either party may
terminate Stifel Nicolaus’ engagement hereunder at any time by giving the other
party at least 30 days’ prior written notice, provided, however, that the Company
may not terminate this Agreement prior to six months from the date hereof. The
provisions of Sections II(C), II(D) (other than the first sentence
thereof), II(E), II(G), II(H), III (A), III (B), III
(C), IV(C), IV(D), IV(E), IV(F), IV(G) and IV(H) hereof shall survive
any expiration or termination of this Agreement.


 


(B)           Stifel Nicolaus is being retained to
serve as financial advisor and financing agent solely to the Company, and it is
agreed that the engagement of Stifel Nicolaus is not, and shall not be deemed
to be, on behalf of, and is not intended to, and will not, confer rights or
benefits upon any shareholder or creditor of the Company or upon any other
person or entity. No one other than the Company is authorized to rely upon this
engagement of Stifel Nicolaus or any statements, conduct or advice of Stifel
Nicolaus, and no one other than the Company is intended to be a beneficiary of
this engagement. All opinions, advice or other assistance (whether written or
oral) given by Stifel Nicolaus in connection with this engagement are intended
solely for the benefit and use of the Company and will be treated by the
Company as confidential, and no opinion, advice or other assistance of Stifel
Nicolaus shall be used for any other purpose or reproduced, disseminated,
quoted or referred to at any time, in any manner or for any purpose, nor shall
any public or other references to Stifel Nicolaus (or to such opinions, advice
or other assistance) be made without the express prior written consent of
Stifel Nicolaus.


 


(C)           The Company agrees that, following
the closing or consummation of a Financing, Sale or other transaction, Stifel
Nicolaus has the right to place advertisements in financial and other
newspapers and journals at its own expense, describing its services


 


 

















 


to the Company and a general description of the
subject Financing, Sale or other transaction, as the case may be.


 


(D)          The Company represents and warrants
that there are no brokers, representatives or other persons that have an
interest in any compensation due to Stifel Nicolaus from any transaction
contemplated herein.


 


(E)           The terms and provisions of this
Agreement are solely for the benefit of the Company and Stifel Nicolaus and the
other Indemnified Persons and their respective successors, assigns, heirs and
personal representatives, and no other person shall acquire or have any right
by virtue of this Agreement. The Company and Stifel Nicolaus acknowledge and
agree that Stifel Nicolaus is acting as an independent contractor, and is not a
fiduciary of, nor will its engagement hereunder give rise to fiduciary duties
to, theCompany. This Agreement represents the entire understanding between the
Company and Stifel Nicolaus with respect to the Financing and the Sale and
Stifel Nicolaus’ engagement hereunder, and all prior discussions are merged
herein including, without limitation, the Prior Agreement, with the exception
of Section II(F) and the related Attachment A thereof which will
survive termination of the Prior Agreement with respect to actions, omissions
or transactions prior to the date of this Agreement that may give rise to a
claim for indemnification or contribution pursuant to those provisions of the
Prior Agreement. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF MARYLAND WITHOUT REGARD TO SUCH
STATE’S PRINCIPLES OF CONFLICTS OF LAWS, AND MAY BE AMENDED, MODIFIED OR
SUPPLEMENTED ONLY BY WRITTEN INSTRUMENT EXECUTED BY EACH OF THE PARTIES HERETO.


 


(F)           It is understood that Stifel
Nicolaus’ obligation under this Agreement is to use its commercially reasonable
efforts throughout the period for which it acts as the Company’s exclusive
agent as described herein. Stifel Nicolaus’ engagement is not intended to
provide the Company or any other person or entity with any assurances that any
Financing, Sale or other transaction will be consummated, and in no event will
Stifel Nicolaus be obligated to purchase Securities for its own account or the
accounts of its customers.


 


(G)           The parties hereby submit to the
jurisdiction of and venue in the federal courts located in the City of
Baltimore, Maryland in connection with any dispute related to this Agreement,
any transaction contemplated hereby, or any other matter contemplated hereby.
If for any reason jurisdiction and/or venue is unavailable in such federal
courts, then the parties hereby submit to the jurisdiction of and venue in the
state courts located in such city in connection with any such dispute or
matter. In addition, the parties hereby waive any right to a trial by jury with
respect to any such dispute or matter.


 


 

















 


If the foregoing correctly
sets forth the entire understanding and agreement between Stifel Nicolaus and
the Company, please so indicate in the space provided for that purpose below
and return an executed copy to us, whereupon this letter shall constitute a
binding agreement as of the date first above written.


 


	
   

  	
  STIFEL,
  NICOLAUS & COMPANY, INCORPORATED

  
	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/

  
	
   

  	
   

  	
  Daniel M. Cornell

  
	
   

  	
   

  	
  Managing Director

  



 


	
  AGREED:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  AMERICAN DEFENSE SYSTEMS,
  INC.

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/

  	
   

  
	
   

  	
  A. J. Piscitelli

  	
   

  
	
   

  	
  Chief Executive Officer

  	
   

  
					



 


 

















 


ATTACHMENT A


 


STIFEL, NICOLAUS & COMPANY, INCORPORATED

INDEMNIFICATION, CONTRIBUTION AND

LIMITATION OF LIABILITY PROVISIONS


 


(a)                                  The Company
agrees to indemnify and hold harmless Stifel Nicolaus and its affiliates and
their respective officers, directors, employees and agents, and any persons
controlling Stifel Nicolaus or any of its affiliates within the meaning of Section 15
of the Securities Act of 1933 or Section 20 of the Securities Exchange Act
of 1934 (Stifel Nicolaus and each such other person or entity being referred to
herein as an “Indemnified Person”), from and against all claims, liabilities,
losses or damages (or actions in respect thereof) or other expenses which (A) are
related to or arise out of (i) actions taken or omitted to be taken
(including any untrue statements made or any statements omitted to be made) by
the Company or its affiliates or (ii) actions taken or omitted to be taken
by an Indemnified Person with the consent or in conformity with the actions or
omissions of the Company or its affiliates or (B) are otherwise related to
or arise out of Stifel Nicolaus’ activities on behalf of the Company. The
Company will not be responsible, however, for any losses, claims, damages,
liabilities or expenses pursuant to clause (B) of the preceding sentence
which are finally judicially determined to have resulted solely from such
Indemnified Person’s gross negligence or willful misconduct. In addition, the
Company agrees to reimburse each Indemnified Person for all out-of-pocket
expenses (including reasonable fees and expenses of counsel) as they are
incurred by such Indemnified Person in connection with investigating,
preparing, conducting or defending any such action or claim, whether or not in
connection with litigation in which any Indemnified Person is a named party, or
in connection with enforcing the rights of such Indemnified Person under this
Agreement.


 


(b)                                 If for any
reason the foregoing indemnity is unavailable to an Indemnified Person or
insufficient to hold an Indemnified Person harmless, then the Company shall
contribute to the amount paid or payable by such Indemnified Person as a result
of such claim, liability, loss, damage or expense in such proportion as is
appropriate to reflect not only the relative benefits received by the Company
on the one hand and Stifel Nicolaus on the other, but also the relative fault
of the Company and Stifel Nicolaus, as well as any relevant equitable
considerations, subject to the limitation that in any event the aggregate
contribution of all Indemnified Persons to all losses, claims, liabilities,
damages and expenses shall not exceed the amount of fees actually received by
Stifel Nicolaus pursuant to this Agreement. It is hereby further agreed that
the relative benefits to the Company on the one hand and Stifel Nicolaus on the
other with respect to any transaction or proposed transaction contemplated by
this Agreement shall be deemed to be in the same proportion as (i) the
total value the transaction or proposed transaction bears to (ii) the fees
paid to Stifel Nicolaus with respect to such transaction.


 


(c)                                  No Indemnified
Person shall have any liability to the Company or any other person in
connection with the services rendered pursuant to this Agreement, except for
any liability 


 


 

















 


                                                for losses,
claims, damages or liabilities finally judicially determined to have resulted
solely from such Indemnified Person’s gross negligence or willful misconduct.


 


(d)                                 The Company agrees
that it will not settle or compromise or consent to the entry of any judgment
in any pending or threatened claim, action, suit or proceeding in respect of
which indemnification may be sought from the Company by any Indemnified Person
(whether any Indemnified Person is an actual or potential party to such claim,
action, suit or proceeding) unless such settlement, compromise or consent
includes an unconditional release of Indemnified Persons hereunder from all
liability arising out of such claim, action, suit or proceeding.


 


(e)                                  To the extent
officers or employees of Stifel Nicolaus appear as witnesses, are deposed, or
otherwise are involved in or assist with any action, hearing or proceeding
related to or arising from any transaction or proposed transaction contemplated
by this Agreement or Stifel Nicolaus’ engagement hereunder, or in a situation
where such appearance, involvement or assistance results from Stifel Nicolaus’
engagement hereunder, the Company will pay Stifel Nicolaus, in addition to the
fees set forth above, Stifel Nicolaus’ customary per diem charges. In addition,
if any Indemnified Person appears as a witness, is deposed or otherwise is
involved in any action relating to or arising from any transaction or proposed
transaction contemplated by this Agreement or Stifel Nicolaus’ engagement
hereunder, or in a situation where such appearance, involvement or assistance
results from Stifel Nicolaus’ engagement hereunder, the Company will reimburse
such Indemnified Person for all expenses (including reasonable fees and
expenses of counsel) incurred by it by reason of it or any of its personnel
being involved in any such action.


 


(f)                                    The Company
waives any right to a trial by jury with respect to any claim or action arising
out of this Agreement or the actions of Stifel Nicolaus, and consents to
personal jurisdiction, service of process and venue in any court in which any
claim covered by the provisions of this Attachment A may be brought against an
Indemnified Person.


 


(g)                                 The provisions
of this Attachment A shall be in addition to any liability the Company may have
to any Indemnified Person at common law or otherwise, and shall survive the
expiration or termination of this Agreement and the closing or consummation of
any transaction or proposed transaction contemplated by this Agreement.