exv10w1







Exhibit 10.1




BURNHAM HILL PARTNERS LLC




			
	590 MADISON AVENUE 

NEW YORK, NEW YORK 10022
	 	TEL 212-980-2200

FAX 212-980-9466






January 30, 2009




Dr. Patrick T. Mooney

Chairman and Chief Executive Officer

Echo Therapeutics, Inc.

10 Forge Parkway

Franklin, MA 02038




Dear Dr. Mooney:



This letter agreement (the “Agreement”), dated January 30, 2009, is made and entered into
by and between Echo Therapeutics, Inc., a Delaware corporation, having a place of business at 10
Forge Parkway, Franklin, MA 02038 (the “Company”) and Burnham Hill Partners LLC, a
registered broker dealer, having a place of business at 590 Madison Ave., 5th Floor, New
York, NY 10022 (“BHP”).




The Company and BHP hereby agree to as follows:




1. Services.



Upon specific written request, BHP shall act as financial advisor to the Company, and shall perform
or cause to be performed such services for the Company as mutually agreed by BHP and the Company,
which may include, without limitation, the following:





	 	(a)	 	general and capital markets advisory services;
	 
	 	(b)	 	business development functions including identifying one or more potential
strategic transactions (a “Strategic Transaction”);
	 
	 	(c)	 	assist in the preparation, implementation, evaluation, structuring and
negotiating of a Strategic Transaction; and
	 
	 	(d)	 	other services for the Company upon which the Company and BHP agree.




Both parties agree that there is no current active mandate under this Agreement. BHP shall begin
performing all services under this agreement when specifically requested by the Company in writing.
In the event the Company desires to move forward with a Strategic Transaction, the Company and BHP
shall enter into a separate letter agreement.




2. Term.



This engagement shall have a term of six months (6) months (the “Term”), which may be
extended upon mutual written agreement of the parties. Either party may, upon ten (10) days
written notice to the other party, terminate this Agreement, provided however, that (i) upon
termination, BHP will continue to be entitled to its full fees through the Term, and (ii) upon
expiration BHP will continue to be entitled to its full fees provided for herein, in the event that
at any time prior to the expiration of six (6) months after such expiration or termination (the
“Tail Period”), the Company completes a Strategic Transaction.




3. Compensation and Payment.



In connection with BHP’s engagement hereunder, all warrants currently held by BHP and/or its
registered employees shall be amended (the “Amended Warrants”) with a term of five (5)
years from the date of this agreement, an exercise price equal to the lower of i) $0.55 or ii) the
current exercise price of such warrants. Additionally, upon the Company providing BHP its first
active mandate for services under this Agreement, BHP and/or its registered assignees or designees
shall be issued 360,000 warrants in substantially the same form as the Amended Warrants



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and shall be exercisable pursuant to a cashless exercise provision, be non-redeemable, have standard weighted
average anti-dilution protection.




4. Confidential Information.



In connection with this Agreement, the Company will furnish BHP with all information concerning the
Company which BHP reasonably deems appropriate and will provide BHP with access to its officers,
directors, employees, accountants, counsel and other representatives (collectively, the
“Representatives”), it being understood that BHP will rely solely upon such information
supplied by the Company and its Representatives without assuming any responsibility for the
independent investigation or verification thereof. All non-public information concerning the
Company that is given to BHP will be used solely in the course of the performance of our services
hereunder and will be treated confidentially by us for so long as it remains non-public. Except as
otherwise required by law, BHP will not disclose any information to any third party without the
consent of the Company.



No advice or opinion rendered by BHP, whether formal or informal, may be disclosed, in whole or in
part, or summarized, excerpted from or otherwise referred to without our prior written consent. In
addition, BHP may not be otherwise referred to without its prior written consent.



If we are requested to render an opinion from a financial point of view regarding any aspect of
this Agreement, the nature, scope and fees associated with our analysis as well as the form and
substance of our opinion shall be such as we deem appropriate and will be covered under a separate
letter agreement.




5. Ongoing Rights and Additional Services.



At any time during either the term of this Agreement or the Tail Period, BHP, at the Company’s
request, shall assist the Company in identifying and facilitating a larger bracket investment bank
to pursue an underwritten public offering of the Company’s securities (an “Underwriting”);
provided, however, that in the event the Company engages another investment banking firm for the
purpose of an Underwriting, BHP shall maintain the right, but not the obligation, to participate in
the Underwriting as a member of the syndicate and shall be entitled to receive compensation as
negotiated with the lead underwriting firm.




6. Indemnity.



Since BHP will be acting on behalf of the Company in connection with its engagement hereunder, the
Company has entered into a separate letter agreement (the “Indemnification Agreement”),
dated the date hereof, providing for the indemnification by the Company of BHP and certain related
persons and entities.




7. Notices.



Notice given pursuant to any of the provisions of this Agreement shall be given in writing and
shall be sent by overnight courier or personally delivered (a) if to the Company, to the Company’s
Chief Executive Officer at the address first listed above; and (b) if to BHP, to its offices at 590
Madison Avenue, 5th floor, New York, NY 10022, Attention: Jason Adelman, Managing Director.




8. Entire Agreement; Modification; and Governing Law.



The letter agreement shall remain in full force and effect as to BHP and the Company. Our
engagement is for the limited purposes set forth under this Agreement, and the rights and
obligations of each of BHP and the Company are herein defined. In connection with this Agreement,
BHP is acting as an independent contractor with duties owing solely to the Company. As such, each
of BHP and the Company agrees that the other party has no fiduciary duty to it or its stockholders,
officers and directors as a result of the engagement described in this Agreement. This Agreement
may not be amended or modified except in writing signed by each of the parties hereto. This
Agreement shall be governed by and construed in accordance with the laws of the State of New York
without regard to conflicts of law principles thereof.




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9. Severability.





The invalidity or unenforceability of any provision of this letter Agreement shall not affect the
validity or enforceability of any other provisions of this Agreement or the Indemnification
Agreement, which shall remain in full force and effect.




10. Section Titles.



The section headings in this Agreement are for convenience only and shall not constitute a part of
this Agreement for any other purpose and shall not be deemed to limit or affect any of the
provisions hereof.




11. Expenses.



Each of the parties hereto agrees to pay its own expenses incident to this Agreement and the
performance of its obligations hereunder.




12. Counterparts.



This Agreement may be executed by facsimile signature and in counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same instrument.




[SIGNATURE PAGE FOLLOWS]




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We are delighted to accept this engagement and look forward to working with you on this assignment.
Please confirm that the foregoing is in accordance with your understanding by signing and returning
to us the enclosed duplicate of this Agreement.



	 	 	 	 	 	 	 
	 	 	Very truly yours,
	 	 	 	 	 	 	 
	 	 	Burnham Hill Partners LLC
	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Jason T. Adelman	 	 
	 	 	Name:
	 	Jason T. Adelman	 	 
	 	 	Title:	 	Senior Managing Director	 	 





Accepted and agreed to as of the date first written above:



Echo Therapeutics, Inc.



	 	 	 	 	 
	By:
	 	/s/ Patrick T. Mooney	 	 
	 	 	 	 	 
	Name:
	 	Patrick T. Mooney	 	 
	Title:
	 	Chairman and Chief

Executive Officer	 	 





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	TO:
	 	Burnham Hill Partners LLC

590 Madison Avenue

New York, NY 10022	 	Date: January 30, 2009




     In connection with your engagement pursuant to our letter agreement (the “Engagement
Agreement”) of even date herewith (the “Engagement”), we agree to indemnify and
hold harmless Burnham Hill Partners LLC (“BHP”), and its affiliates, the respective
directors, officers, partners, agents and employees of BHP and its affiliates, and each other
person, if any, controlling BHP or any of its affiliates or successor in interest
(collectively, “Indemnified Persons”), from and against, and we agree that no
Indemnified Person shall have any liability to us or our owners, parents, affiliates, security
holders or creditors for, any losses, claims, damages or liabilities (including actions or
proceedings in respect thereof) (collectively “Losses”) (A) related to or arising out
of (i) our actions or failures to act (including statements or omissions made, or information
provided, by us or our agents) in connection with the Engagement or (ii) actions or failures to
act by an Indemnified Person in connection with the Engagement with our consent or in reliance
on our actions or failures to act, or (B) otherwise related to or arising out of the Engagement
or your performance thereof, except that this clause (B) shall not apply to any Losses that are
finally judicially determined to have resulted primarily from your bad faith or gross
negligence or breach of the Engagement Agreement. If such indemnification is for any reason
not available or insufficient to hold you harmless, we agree to contribute to the Losses
involved in such proportion as is appropriate to reflect the relative benefits received (or
anticipated to be received) by us and by you with respect to the Engagement or, if such
allocation is judicially determined unavailable, in such proportion as is appropriate to
reflect other equitable considerations such as the relative fault of us on the one hand and of
you on the other hand; provided, however, that, to the extent permitted by applicable law, the
Indemnified Persons shall not be responsible for amounts which in the aggregate are in excess
of the amount of all fees actually received by you from us in connection with the Engagement.
Relative benefits to us, on the one hand, and you, on the other hand, with respect to the
Engagement shall be deemed to be in the same proportion as (i) the total value paid or proposed
to be paid or received or proposed to be received by us or our security holders, as the case
may be, pursuant to the transaction(s), whether or not consummated, contemplated by the
Engagement bears to (ii) all fees paid or proposed to be paid to you by us in connection with
the Engagement.


     We will reimburse each Indemnified Person for all reasonable expenses (including reasonable
fees and disbursements of counsel) as they are incurred by such Indemnified Person in connection
with investigating, preparing for or defending any action, claim, investigation, inquiry,
arbitration or other proceeding (“Action”) referred to above (or enforcing this Agreement
or the Engagement Agreement), whether or not in connection with pending or threatened litigation in
which any Indemnified Person is a party, and whether or not such Action is initiated or brought by
you. We further agree that we will not settle or compromise or consent to the entry of any judgment
in any pending or threatened Action in respect of which indemnification may be sought hereunder
(whether or not an Indemnified Person is a party therein) unless we have given you reasonable prior
written notice thereof and used all reasonable efforts, after consultation with you, to obtain an
unconditional release of each Indemnified Person from all liability arising therefrom. In the
event we enter into one or a series of transactions involving a merger or other business
combination or a dissolution or liquidation of all or a significant portion of our assets, we shall
promptly notify you in writing. If requested by BHP, we shall then establish alternative means of
providing for our obligations set forth herein on terms and conditions reasonably satisfactory to
BHP.


     If multiple claims are brought against you in any Action with respect to at least one of which
indemnification is permitted under applicable law and provided for under this Agreement, we agree
that any judgment, arbitration award or other monetary award shall be conclusively deemed to be
based on claims as to which indemnification is permitted and provided for. In the event that you
are called or subpoenaed to give testimony in a court of law with respect to any Action, we agree
to pay your expenses related thereto and for every day or part thereof that you are required to be
there or in preparation thereof. Our obligations hereunder shall be in addition to any rights that
any Indemnified Person may have at common law or otherwise. Solely for the purpose of enforcing
this Agreement, we hereby consent to personal jurisdiction and to service and venue in any court in
which any claim which is subject to this Agreement is brought by or against any Indemnified Person.
We acknowledge that in connection with the Engagement you are acting as an independent contractor
with duties owing solely to us. YOU HEREBY AGREE, AND WE HEREBY AGREE ON OUR OWN BEHALF AND, TO
THE EXTENT PERMITTED BY APPLICABLE LAW, ON BEHALF OF OUR SECURITY HOLDERS, TO WAIVE ANY RIGHT TO
TRIAL BY JURY WITH RESPECT TO ANY CLAIM, COUNTER-CLAIM OR ACTION ARISING OUT OF THE ENGAGEMENT,
YOUR PERFORMANCE THEREOF OR THIS AGREEMENT.


     The provisions of this Agreement shall apply to the Engagement (including related activities
prior to the date hereof) and any modification thereof and shall remain in full force and effect
regardless of the completion or termination of the Engagement. This Agreement and the Engagement
Agreement shall be governed by and construed in accordance with the laws of the state of New York,
without regard to conflicts of law principles thereof.



	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Very truly yours,
	 
	 	 	 	 	 	 
	Accepted and Agreed:	 	 	 	 
	 
	 	 	 	 	 	 
	Burnham Hill Partners LLC	 	 	 	Echo Therapeutics, Inc.
	 
	 	 	 	 	 	 
	By:
	 	/s/ Jason T. Adelman	 	By:	 	/s/ Patrick T. Mooney
	 
	 	 	 	 	 	 
	 
	 	Name: Jason T. Adelman	 	 	 	Name: Patrick T. Mooney
	 
	 	Title:   Senior Managing Director	 	 	 	Title:   Chairman and Chief Executive Officer