SECURITIES PURCHASE AGREEMENT This Securities Purchase Agreement is entered into as of June 27, 2003, by and between Air-Q Wi-Fi Corporation, a Delaware corporation ("AIR-Q"), and Heyer Capital Fund ("Purchaser"), in light of the following facts:...
|
EXHIBIT 10.13 |
|
|
This Securities Purchase Agreement is entered into as of June 27, 2003, by and between Air-Q Wi-Fi
Corporation, a Delaware corporation ("AIR-Q"), and Xxxxx Capital Fund ("Purchaser"), in light of the following
facts:
WHEREAS, AIR-Q is a start-up business engaged in the wireless Internet access business; and
WHEREAS, Purchaser desires to acquire shares of common stock and common stock purchase
warrants (the common stock and common stock purchase warrants being referred to collectively as
the "Units") of AIR-Q; and
WHEREAS, AIR-Q desires to issue shares of its common stock and common stock purchase
warrants to Purchaser on the terms and conditions set forth in this Agreement.
WITNESSETH:
THEREFORE, the Agreement of the parties, the promises of each being consideration for the promises of
the other:
I. DEFINITIONS
Whenever used in this Agreement, the following terms shall have the meanings set forth below, including
the exhibit hereto or amendments hereof.
(a) "Agreement" shall mean this Securities Purchase Agreement and all exhibits hereto or amendments
hereof.
(b) "Knowledge of AIR-Q" or matters "known to AIR-Q" shall mean matters actually known to the
Board of Directors or officers of AIR-Q, or which reasonably should be or should have been known by them upon
reasonable investigation.
(c) "Purchaser" shall mean Xxxxx Capital Fund.
(d) "Securities Act" shall mean the Securities Act of 1933, as amended, and includes the rules and
regulations of the Securities and Exchange Commission ("SEC") promulgated thereunder, as such shall then be in
effect.
(e) "AIR-Q" shall mean Air-Q Wi-Fi Corporation, a Delaware corporation, including its subsidiaries.
Any term used herein to which a special meaning has been ascribed shall be construed in accordance with
either (1) the context in which such term is used, or (2) the definition provided for such terms in the place in this
Agreement at which such term is first used.
II. DISCLOSURES
Purchaser hereby acknowledges that it has had the opportunity to ask questions of, and receive answers
from, the principals of AIR-Q regarding its business plan and otherwise investigate the matters contained therein.
Specifically, Purchaser understands that AIR-Q may never earn a profit or have its common stock traded publicly in
any market. Thus, Purchaser understands that it may be required to hold the securities comprising the Units
indefinitely.
III. PURCHASE AND SALE
AIR-Q hereby sells to Purchaser and Purchaser hereby buys from AIR-Q the following securities (the
Units):
(a) 1,250,000 shares of the $.001 par value common stock of AIR-Q;
(b) 1,250,000 warrants to purchase a like number of shares of common stock of AIR-Q, at an exercise
price of $.20 per share, all as more fully set forth in the form of warrant attached hereto as Exhibit "A" and
incorporated herein by this reference;
(c) 1,250,000 warrants to purchase a like number of shares of common stock of AIR-Q, at an exercise
price of $.30 per share, all as more fully set forth in the form of warrant attached hereto as Exhibit "B" and
incorporated herein by this reference;
(d) 1,250,000 warrants to purchase a like number of shares of common stock of AIR-Q, at an exercise
price of $.40 per share, all as more fully set forth in the form of warrant attached hereto as Exhibit "C" and
incorporated herein by this reference; and
(e) 1,250,000 warrants to purchase a like number of shares of common stock of AIR-Q, at an exercise
price of $.50 per share, all as more fully set forth in the form of warrant attached hereto as Exhibit "D" and
incorporated herein by this reference.
The Units shall be sold to Purchaser at the price and subject to all of the terms and conditions set forth
herein.
It is agreed by the parties that none of the purchase price for the Units described herein shall be allocated to
the common stock purchase warrants.
IV. PURCHASE PRICE - PAYMENT
Purchaser shall deliver to AIR-Q the sum of $125,000 in payment of the 1,250,000 shares of AIR-Q
common stock, the 1,250,000 $.20 common stock purchase warrants, 1,250,000 $.30 common stock purchase
warrants, 1,250,000 $.40 common stock purchase warrants and the 1,250,000 $.50 common stock purchase warrants
(the Units) purchased by Purchaser hereunder, a per Unit price of $.10, which payment shall be delivered as
provided in paragraphs VI and VII hereinbelow.
V. ISSUANCE OF THE UNITS
AIR-Q shall cause the 1,250,000 shares of its common stock, the 1,250,000 $.20 common stock purchase
warrants, 1,250,000 $.30 common stock purchase warrants, 1,250,000 $.40 common stock purchase warrants and the
1,250,000 $.50 common stock purchase warrants purchased and sold hereunder to be issued as provided in
paragraphs VI and VII hereinbelow.
VI. THE EXCHANGE
Upon the mutual execution of this Agreement, Purchaser agrees to deliver forthwith the sum of $125,000
required to be delivered pursuant to paragraph IV hereof. Upon receipt of such funds, AIR-Q shall deliver to
Purchaser the following securities: (1) a stock certificate representing 1,250,000 shares of common stock of AIR-Q;
(2) a duly executed common stock purchase warrant, in the form of Exhibit "A" attached hereto, representing
1,250,000 $.20 common stock purchase warrants; (3) a duly executed common stock purchase warrant, in the form
of Exhibit "B" attached hereto, representing 1,250,000 $.30 common stock purchase warrants; (4) a duly executed
common stock purchase warrant, in the form of Exhibit "C" attached hereto, representing 1,250,000 $.40 common
stock purchase warrants and (5) a duly executed common stock purchase warrant, in the form of Exhibit "D"
attached hereto, representing 1,250,000 $.50 common stock purchase warrants.
VII. REPRESENTATIONS AND WARRANTIES OF AIR-Q
AIR-Q represents and warrants to Purchaser:
(a) Organization and Corporate Authority. AIR-Q is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and is qualified to do business as a foreign corporation
in all jurisdictions where the ownership of property or maintenance of an office would require qualification. AIR-Q
has all requisite corporate power and authority, governmental permits, consents, authorizations, registrations,
licenses and memberships necessary to own its property and to carry on its business in the places where such
properties are now owned and operated or such business is being conducted.
(b) Subsidiaries. AIR-Q, the issuer of the securities sold hereunder, has one subsidiary corporation,
Air-Q Corporation, a Nevada corporation.
(c) Options, Warrants and Rights. Prior to the consummation of the transactions contemplated by this
Agreement, AIR-Q has no outstanding options, warrants or rights, conversion rights or other agreements for the
purchase or acquisition from AIR-Q of any shares of its capital stock, except as listed in Exhibit "E" attached hereto.
(d) Issuance of the Securities Comprising the Units. The shares of common stock of AIR-Q, when
issued and delivered in accordance with this Agreement, will be duly and validly issued, fully paid and non-
assessable, and will be free and clear of any liens or encumbrances and, to the knowledge of AIR-Q, will be issued in
compliance with applicable state and federal laws. The common stock purchase warrants of AIR-Q, when issued and
delivered in accordance with this Agreement, will be duly and validly issued and will be free and clear of any liens or
encumbrances and, to the knowledge of AIR-Q, will be issued in compliance with applicable state and federal laws.
The shares of common stock of AIR-Q underlying the common stock purchase warrants, when issued and delivered
in accordance with this Agreement and the warrant agreement, will be duly and validly issued, fully paid and non-
assessable, and will be free and clear of any liens or encumbrances and, to the knowledge of AIR-Q, will be issued in
compliance with applicable state and federal laws.
(e) Financial Condition; Use of Proceeds. AIR-Q is a development stage company without significant
revenues and is substantially illiquid. AIR-Q requires substantial additional capital with which to implement its
business plan. There is no assurance that AIR-Q will obtain such needed capital or that its business plan, when
implemented, will prove to be successful. The funds derived under this Agreement will be utilized for working
capital.
(f) Undisclosed or Contingent Liabilities. To the best knowledge of AIR-Q and to its officers and
directors, AIR-Q has no material liabilities and, to the best knowledge of the officers and directors of AIR-Q, AIR-Q
has no contingent liabilities.
(g) Litigation. AIR-Q is not a party to any suit, action, proceeding, investigation or labor dispute
(collectively "actions") pending or currently threatened against it other than administrative matters arising in the
ordinary course of business .
(h) Compliance with Agreements. The execution and performance of this Agreement will not result in
any violation or be in conflict with any agreement to which AIR-Q is a party.
(i) Title to Property and Assets. AIR-Q has good and marketable title to its properties and assets free
and clear of all mortgages, liens, security interests and encumbrances.
(j) Franchises and Permits; Taxes and Other Liabilities. To the knowledge of AIR-Q, it has all
franchises, permits, licenses, orders and approvals of any federal, state, local or foreign government of self
regulatory body (collectively, the "Permits") that are material to or necessary for the conduct of its business. To the
knowledge of AIR-Q, it has no outstanding tax liabilities, no unsatisfied final judgment or valid lien filed against it
or any of its property.
(k) Governmental Consents. To the knowledge of AIR-Q, no consent, approval, order or
authorization of, or registration, qualification, designation, declaration or filing with, any governmental authority on
the part of AIR-Q is required in connection with the valid execution, delivery and performance of this Agreement.
(l) Authorization. All corporate action on the part of AIR-Q and its officers, directors and
shareholders necessary for the authorization, execution and delivery of this Agreement, for the performance of AIR-
Q's obligations hereunder and for the issuance and delivery of the securities comprising the Units has been taken.
This Agreement, when executed and delivered, shall constitute a legal, valid and binding obligation of AIR-Q.
(m) Regulatory Compliance. To the knowledge of AIR-Q, it is in compliance with all applicable
environmental regulations relating to its business operations, as well as all applicable regulations promulgated by the
Federal Communications Commission.
(n) Affiliate Transactions. AIR-Q has entered into the material transactions with affiliates described in
Exhibit "E" attached hereto and incorporated herein by this reference.
(o) Employee Matters. To the knowledge of AIR-Q, it is in compliance with all laws and regulations
applicable to employee-related matters.
(p) Suppliers and Customers. To the knowledge of AIR-Q, its relations with its suppliers and
customers are good.
VIII. REPRESENTATIONS AND WARRANTIES OF PURCHASER
(a) All corporate or other similar action on the part of Purchaser and its officers, directors and
shareholders, if required, necessary for the authorization, execution and delivery of this Agreement, for the
performance of Purchaser's obligations hereunder and for the delivery of the funds has been taken. This Agreement,
when executed and delivered, shall constitute a legal, valid and binding obligation of Purchaser.
(b) Purchaser represents and warrants that the Units are being purchased by it solely for its own
account for investment purposes only and not for the account of any other person and not for distribution, assignment
or resale to others.
(c) Purchaser further consents to the placement of the following legend, or a legend similar thereto, on
the certificates representing shares of common stock and the common stock purchase warrants comprising the Units:
"THE SECURITIES, AND THE SECURITIES INTO WHICH THEY MAY BE CONVERTED,
REPRESENTED BY THIS CERTIFICATE HAVE BEEN ISSUED IN RELIANCE UPON THE
EXEMPTION FROM REGISTRATION AFFORDED BY REGULATION S OF THE
SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES MAY NOT BE
TRANSFERRED WITHOUT REGISTRATION, EXCEPT IN A TRANSACTION EXEMPT
FROM SUCH REGISTRATION."
IX. MISCELLANEOUS
Survival of Covenants. Unless otherwise waived as provided herein, all covenants agreements,
representations and warranties of the parties made in this Agreement and in the financial statements or other written
information delivered or furnished in connection therewith and herewith shall survive the Exchange hereunder, and
shall be binding upon, and inure to the benefit of, the parties and their respective successors and assigns.
Arbitration. In the event of a dispute between the parties hereto that arises out of this Agreement, the
parties hereby agree to submit such dispute to arbitration before the American Arbitration Association (the
"Association") at its Dallas, Texas, offices, in accordance with the then-current rules of the Association; the award
given by the arbitrators shall be binding and a judgment can be obtained on any such award in any court of
competent jurisdiction. It is expressly agreed that the arbitrators, as part of their award, can award attorneys fees to
the prevailing party.
Governing Law. This Agreement shall be deemed to be a contract made under, governed by and construed
in accordance with the substantive laws of the State of Louisiana.
Counterparts. This Agreement may be executed simultaneously in counterparts, each of which when so
executed and delivered shall be taken to be an original; but such counterparts shall together constitute but one and
the same documents.
Successors and Assigns. Except as otherwise expressly provided herein, the provisions hereof shall inure to
the benefit of, and be binding upon, the successors, assigns and administrators of the parties hereto.
Entire Agreement. This Agreement, the other agreements and the other documents delivered pursuant
hereto and thereto constitute the full and entire understanding and agreement between the parties with regard to the
subjects hereof and thereof.
IN WITNESS WHEREOF, the parties have signed this Agreement as of the day and year first above
written.
"AIR-Q":
AIR-Q WI-FI CORPORATION
By: /s/ XXXXX XXXXXX
Xxxxx Xxxxxx
President
"PURCHASER":
XXXXX CAPITAL FUND
By: /s/ XXXXX XXXXXX
Name: __________________________
Title: ___________________________
