EXHIBIT 10.5
AMENDED AGREEMENT
This Amended Agreement (the "Amended Agreement") is entered into as of this
_____ day of June 2004, by and among Techsphere Systems International, LLC,
("TSI") a Georgia limited liability company with offices at 000 Xxxxxxx Xxxxx,
Xxxxxxxx 00, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000, and Cyber Aerospace Corp.,
("Cyber") with offices at 0000 Xxxxxxxx Xxxxx Xxxxx, Xxxx Xxxxx Xxxxxx, Xxxxxxx
00000 a corporation organized under the laws of the State of Florida and an
operating subsidiary of On Alert Systems, Inc. a Nevada Corporation. The parties
may be referred to individually as a Party and collectively as the Parties.
W I T N E S S E T H:
WHEREAS, TSI and Cyber entered an Agreement dated March 10, 2004 for Cyber to
purchase a prototype airship from TSI and to exclusively market Airships
manufactured by TSI to Government Units and non-exclusively to commercial
enterprises as agreed to by the Parties; and
Whereas, subsequently effective May 1, 2004 the Parties entered a Sales and
Marketing Agreement ("Marketing Agreement") setting forth in more detail the
marketing and sales arrangements described in the Agreement and which is used
herein to define the capitalized words; and
Whereas, due to the changing economic situation and the need to finish payment
to 21st Century Airships, Inc. for the 62.5 ft diameter spherical airship prior
to the test flight demonstration in Maryland; and
WHEREAS, the Parties have agreed to amend and revise the terms of the original
Agreement as set forth herein in order to better fulfill the intent of the
original Agreement.
CONSIDERATION:
Now therefore, in consideration of the mutual covenants contained herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Parties agree to amend the above described
Agreement dated March 10, 2004 as follows:
I
1. Article I is amended by deleting sections 1.1 and 1.2 B in their
entirety.
II
1. Article II has been superceded by the Marketing Agreement effective May
1, 2004 between the parties.
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III
1. Article III is amended as follows:
A. Subsection 3.1 is amended by deleting Subsection A, which shall be
replaced with the following:
In order to resolve all issues between the Parties involving the sale
of the 62.5 ft diameter spherical airship FAA # N8041X to Cyber, the
Parties agree to the following:
1. In the event the June 21, 2004 test flight is Successful (as
defined in accordance with the agreement between TSI and SNC dated
June 1, 2004):
a. TSI shall make Cyber the designated seller of the existing
prototype 62.5 ft diameter spherical airship FAA # N8041X to
Sierra Nevada Corporation in recognition of the assignment to
Cyber of TSI's right to purchase the airship in Section 1.1 of
the March 10 Agreement. SNC shall pay all sums to TSI for the
62.5 ft diameter spherical airship FAA # N8041X and TSI shall pay
the outstanding sums due to 21st Century Airships, Inc. TSI shall
allow Cyber to publicize that Cyber is the seller of the airship
to SNC.
b. TSI shall allow Cyber to submit a Purchase Order by June 30, 2004
for TSI to build a low altitude Airship Seventy-six (76) feet in
diameter for the sum of Two Million Seven Hundred Thousand
Dollars ($2,700,000.00); provided that the final Purchase Price
shall be contingent upon the exact specifications agreed to by
the Parties. In return for Cyber allowing the sale of the 62.5 ft
diameter spherical airship FAA # N8041X to Sierra Nevada
Corporation (SNC), TSI agrees that, notwithstanding the terms of
the Marketing Agreement, Cyber shall be allowed to use the low
altitude Airship Seventy-six (76) feet in diameter for marketing
of Airships, testing of sensing and telecommunications equipment
to be installed in Airships and/or be sold to one of Cyber's
Customers pursuant to the terms of the existing Marketing
Agreement. The Purchase Order shall be submitted to TSI on or
before July 15, 2004 with the required Down Payment of $675,000
and the remaining payments to be made according to the terms of
the Marketing Agreement. TSI will allow Cyber to pay the balance
($375,000) of the difference between the $2,700,000.00 and
$2,200,000.00, upon the sale of the 76' Airship or from the first
commission it earns under its Marketing and Sales Agreement,
whichever is first. Upon TSI's acceptance of the Purchase Order
it will notify Cyber of the anticipated date of Delivery. TSI
shall commence manufacture of the 76' airship by ordering the
fabric upon receipt of the Down Payment.
c. The $300,000 Down Payment previously paid by Cyber is transferred
toward the Down Payment for purchase of the 76' airship. The
$375,000 balance of the Down Payment shall be due on July 15,
2004.
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d. TSI will be responsible for the warranty, if any, on the 62.5'
airship sold to SNC.
2. In the event the flight on June 21, 2004 is not Successful:
a. Cyber shall purchase an undivided 75% interest of the 62.5'
airship encumbered with an undivided 25% ownership by SNC with
Integration Rights.
b. The purchase price for the 75% interest is $1,650,000, of which
$300,000 has already been paid by Cyber, leaving a balance of
$1,350,000 payable by July 15, 2004.
c. Cyber does not purchase a 76' airship from TSI.
B. Whether or not the test flight is Successful, TSI will be
responsible for paying all commissions, if any, due to SRC under its
agreement with SRC dated January 3, 2003.
C. The remaining Three Hundred Thousand Dollars ($300,000.00) due for
the exclusive world-wide marketing rights to Government Unit End User and
non-exclusive world-wide marketing rights to Telecommunications End Users
described in Subsection B. shall be payable to TSI on or before July 15,
2004.
D. The remainder of Article III is deleted.
IV
1. Article IV is deleted.
V
1. Articles V through VIII will remain as worded, except that subsection
8.11 shall be deleted to be replaced with the following:
8.11 This Agreement shall terminate upon written notice by the
non-defaulting Party declaring a breach and/or termination upon the
following:
A. Cyber's failure to timely make the payments due for the
Airship and the world-wide marketing rights as described in
Subsections 3 A and B.
B. If either Party files a petition under any chapter of the
Bankruptcy Act, 11 U.S.C. xx.xx. 101 et seq., an involuntary petition
under that Act is filed against either Party, a Party commences an
action in any country under laws providing for the relief of winding
up of insolvent or liquidating persons or entities, or files for the
appointment of a receiver or becomes insolvent, and such matters are
not discharged or relieved within sixty (60) days.
C. For any other material breach of this Amended Agreement, after
the non-breaching party provides 30 days notice to the breaching
party, and the breaching party has failed to cure the breach within
such 30-day period.
Except as set forth herein, the Agreement shall remain as worded.
IN WITNESS WHEREOF, the Parties hereto have caused this Amended Agreement to be
executed on the date set forth above by their duly authorized representatives
identified below.
Cyber Aerospace Corp.: TECHSPHERE SYSTEMS
INTERNATIONAL, LLC:
By: /s/Xxxxxxx X. Xxxxxxxx By: /s/Xxxx Xxxxxx
-------------------------- --------------------------
Xxxxxxx X. Xxxxxxxx Xxxx Xxxxxx
Chief Executive Officer President
Attest:
Attest:
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Secretary [SEAL]
Secretary [SEAL]
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