AMENDED & RESTATED SECURITIES PURCHASE AGREEMENT BY AND AMONG 4C CONTROLS INC. AND BQT SOLUTIONS LIMITED BQT SATELLITES LIMITED BQT SECURITY SYSTEMS PTY LTD
BY
AND AMONG
AND
BQT
SOLUTIONS LIMITED
BQT
SATELLITES LIMITED
BQT
SECURITY SYSTEMS PTY LTD
THIS
AMENDED & RESTATED SECURITIES PURCHASE AGREEMENT (this “Agreement”),
dated
April __, 2008, is entered into by and among 4C Controls Inc., a Nevada
corporation having its principal offices at Rockefeller
Center, 1230 Avenue of the Americas - 0xx Xxxxx, Xxx Xxxx, XX 00000
(“Amici”),
BQT
Solutions Limited ACN 000 000 000 (“BQT
Solutions”),
BQT
Satellites Limited ACN 126 450 726 (“BQT
Satellites”),
BQT
Intelligent Security Systems Pty Ltd ACN 126 450 584 (“BQT
Security”)
and
together with BQT Solutions and BQT Satellites, the “BQT
Companies”)
each
of which is an Australian corporation having its principal office at Xxxxx
0, 00
Xxxxxx Xxxx, Xxxxx Xxxx XXX 0000.
WITNESSETH
:
WHEREAS,
BQT Solutions agreed in principle to an Executive Investment Proposal (the
“Original
Proposal”),
introduced by Prime Asset Finance Limited (“PAF”)
regarding investment in BQT Solutions;
WHEREAS,
BQT Solutions agreed in principle to a Revised Executive Investment Proposal
(the “Revised
Proposal”),
dated
January 28, 2008, regarding the acquisition of the Amici Shares and the Amici
Options, and which replaced the Original Proposal;
WHEREAS,
BQT Solutions agreed in principle to a Second Revised Executive Investment
Proposal (the “Second
Revised Proposal”),
dated
January 31, 2008, regarding the acquisition of the Amici Shares and the Amici
Options, which replaced and restated the Revised Proposal;
WHEREAS,
the parties previously formalized the terms and conditions set forth in the
Second Revised Proposal in a securities purchase agreement dated March 19,
2008
(the “First
Securities Purchase Agreement”);
WHEREAS,
the parties wish to revise certain of the terms and conditions set forth in
the
First Securities Purchase Agreement to reflect more accurately and precisely
the
economic premises that the parties had contemplated in the Original Proposal,
the Revised Proposal and the Second Revised Proposal and to replace the First
Securities Purchase Agreement with this Agreement;
WHEREAS,
BQT Solutions desires to consolidate its outstanding ordinary shares at a
reduction ratio of seven-to-one and whereby for each fraction of a share
resulting after the seven-for-one consolidation of shares a full new share
shall
be issued (the “Consolidation”);
WHEREAS,
Amici desires to acquire additional ordinary shares of BQT Solutions (the
“Amici
Shares”),
and
BQT Solutions wishes to issue the Amici Shares;
WHEREAS,
Amici desires to acquire stock options whereby Amici would receive, subject
to
approval of the shareholders of BQT Solutions and after giving effect to the
proposed seven-for-one share consolidation (as defined below), nine million
five
hundred thousand (9,500,000) ordinary shares of BQT Solutions and BQT Solutions
wishes to issue to Amici said stock options at an exercise price of AUD$0.10
per
share (the “Amici
Options”);
WHEREAS,
Amici desires to acquire forty percent (40%) of the ordinary shares of BQT
Satellites (the “Satellite
Shares”;
the
Satellite Shares, the
Amici
Shares and the Amici Options together hereinafter referred to as the
“Acquired
Securities”);
WHEREAS,
Amici desires to relinquish
its
rights to acquire shares of BQT Security and BQT Solutions desires to release
Amici from any and all obligations in respect of financing arrangements thereto;
and
WHEREAS,
BQT Solutions has decided that it will not implement the BQT Security
development program through a separate subsidiary, BQT Solutions having decided
to implement said development program directly as BQT Solutions;
WHEREAS,
the parties wish to amend and restate the terms of agreement as between the
Company and PAF with respect to options granted pursuant to prior services
rendered by PAF; and
WHEREAS,
with respect to any and all stock options to be issued under this Agreement,
all
such stock options refer to shares that shall not be issued at the time the
stock options are issued but only to shares that will be issued at the time
any
such stock options are exercised.
NOW,
THEREFORE, in consideration of the covenants, promises and representations
set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and intending to be legally bound
hereby, the parties agree as follows:
1. Issue
of
the Amici Shares.
1.1
Shares.
(a) Purchase
Price Per Share. Subject to the terms and conditions stated herein,
BQT
Solutions shall issue and allot to Amici, and Amici shall accept and acquire,
the Amici Shares and any and all rights in the shares as set forth herein.
The
Amici Shares will be subscribed for and purchased in tranches.
(b) First
Tranche. The parties acknowledge and agree that the first tranche of
AUD$1 million has been paid to BQT Solutions on March 3, 2008 in
consideration of which five million (5,000,000) ordinary shares of BQT Solutions
have been issued to Amici at a purchase price of AUD$0.20 per share.
(d) Second
Tranche. After completion of the conditions to the financing specified in
Sections 6.1, 6.3 and 6.10 below and subject to BQT shareholder approval of
the
issue, Amici shall prior to the Consolidation pay to BQT Solutions an aggregate
of AUD$680,000 in consideration of which three million four hundred thousand
(3,400,000) pre-Consolidation ordinary shares of BQT Solutions shall be issued
to Amici (the “Second Tranche”) at a purchase price of AUD$0.20 per share
pre-Consolidation.
(e) Third
Tranche. Following the closing of the Second Tranche and after the Consolidation
is completed and subject to BQT shareholder approval of the issue, Amici shall
pay to BQT Solutions an aggregate of AUD$2,320,000 in consideration of which
eleven million six hundred thousand (11,600,000) post-Consolidation ordinary
shares of BQT Solutions shall be issued to Amici (the “Third Tranche”) at a
purchase price of AUD$0.20 per share post-Consolidation.
(f) Summary
of Share Purchases. For purposes of clarity the following sets out the summary
of the share purchases by Amici of the ordinary shares of BQT
Solutions:
|
Tranche
|
Shares
|
Purchase
Price
Per
Share
|
Purchase
Price
|
|
First
Tranche
|
5,000,000
|
AUD$0.20
|
AUD$1,000,000
|
|
Second
Tranche
|
3,400,000
|
AUD$0.20
|
AUD$ 680,000
|
|
Subtotal
|
8,400,000
|
||
|
Consolidation
(1:7)
|
1,200,000
|
||
|
Third
Tranche
|
11,600,000
|
AUD$0.20
|
AUD$2,320,000
|
|
Total
|
12,800,000
|
AUD$4,000,000
|
(g) All
Amici
Shares shall be issued to Amici in uncertificated form. In the event that BQT
Solutions fails to meet the conditions to financing set forth herein, Amici
shall have no obligations to purchase or subscribe for shares of BQT Solutions
hereunder.
(h) BQT
Solutions will comply with sections 708A(5), (6) and (7) of the Corporations
Xxx
0000 (Cth) with respect to the issue of the Second Tranche and Third Tranche
shares.
1.2 Options.
Subject to shareholder approval
and
following the Consolidation, BQT Solutions shall grant the Amici Options, which
following the Consolidation shall consist of options granted to Amici for the
issue of nine million five hundred thousand (9,500,000) shares of BQT Solutions,
at an exercise price (following the Consolidation) of AUD$0.10 per share.
The shares constituting the Amici Shares and underlying the Amici Options are
referred to as the “Financing
Shares”.
For purposes of clarity, the Amici Options will be issued after the
Consolidation and the AUD $0.10 per share exercise price of the Amici Options
shall not be subject to price adjustment for the Consolidation. The Amici
Options will be promptly issued proportionately within five business days after
the later of the Consolidation and proportionately upon the receipt of each
tranche of the financings by Amici of the BQT Companies as described herein.
The
options may be exercised by Amici at any time on or before December 31, 2013
by
written notice to BQT Solutions pursuant to which BQT Solutions shall issue
the
underlying shares thereof upon payment thereto no later than one (1) business
day following such date of exercise. No shares shall be issued in respect of
the
Amici Options unless and until exercise of the Amici Options. Upon exercise
of
any of the Amici Options, BQT shall apply for quotation of the underlying shares
as soon as possible and in any event within five business days after such
exercise.
2. Ancillary
Transactions.
2.1 BQT
Satellites. Subject to the terms and conditions stated herein, at the Closing
(as defined below), Amici will subscribe for the Satellite Shares in
consideration for the payment of AUD$14 million, in order to fund BQT Satellites
to commence operations of the business described in the business plan prepared
by PriceWaterhouseCoopers. The Satellite Shares acquired by Amici shall
represent forty percent (40%) of the issued and outstanding shares of BQT
Satellites. BQT Solutions accepts and agrees that its sixty percent (60%) equity
stake in BQT Satellites will be reduced to twenty percent (20%). For purposes
of
clarity, no shareholder of BQT Satellites will be required to sell or transfer
any shares to Amici. BQT Solutions will after the purchase set out in this
Section 2 vote for the election of directors of BQT Satellites as nominated
by
Amici and agree to the appointment of officers of BQT Satellites as appointed
by
the newly appointed BQT Solutions Group CEO . The parties hereto shall take
all
necessary actions to draft and execute any and all supplementary agreements
necessary to implement the terms and conditions of this Section 2.
2.2 BQT
Security. Amici hereby relinquishes any and all prior rights to acquire equity
interests in BQT Security. BQT Solutions hereby undertakes to assign any and
all
rights of BQT Security to BQT Solutions and to liquidate and terminate the
existence of BQT Security as soon as reasonably possible. Amici and BQT
Solutions both accept and agree that
BQT
Solutions will not implement the BQT Security development program through its
subsidiary BQT Security, with BQT Solutions having determined to implement
the
relevant development program directly as BQT Solutions, and as such Amici will
not provide financing to BQT Security.
3. Limited
Private Placement. Before the Consolidation, BQT Solutions shall undertake
a
limited private placement of up to eight million four hundred thousand
(8,400,000) newly issued ordinary shares of BQT Solutions (the “Private
Placement Shares”).
The
Private Placement Shares shall be offered only to the 30 (thirty) largest
shareholders of record of BQT Solutions as of the date of notice for the
shareholder meeting called to approve the matters set forth herein, provided
that all such shareholders fall within an exemption in section 708 of the
Corporations Xxx 0000 (Cth) and all of which must qualify for participation
in
such private placement under applicable regulatory rules. None of Amici or
any
of its subsidiaries or affiliates will participate in the limited private
placement. The Private Placement Shares shall be offered at a price of AUD$0.05
per share. BQT Solutions will comply with sections 708A(5), (6) and (7) of
the
Corporations Xxx 0000 (Cth) with respect to the issue of the Private Placement
Shares.
4. Closing.
The closing (the “Closing”)
of the
transactions contemplated under Section 2 hereof shall take place at such place
as the parties hereto may agree, provided, however, time is of the essence
and
the Closing shall not be later than ten (10) business days from the date on
which BQT Solutions receives a total of AUD$3 million pursuant to the Second
Tranche and Third Tranche payments referred to in Section 1.1
hereof.
5.
Representations
and Warranties; Indemnification.
5.1
Representations
and Warranties of Amici. As an inducement to BQT Companies to enter into this
Agreement and to consummate the transactions contemplated herein, Amici
represents and warrants to the BQT Companies as follows, all of which are true
and complete as of the date of this Agreement and as of the Closing, except
to
the extent set forth on a disclosure schedule attached hereto referencing the
Section and paragraph number of the provision herein corresponding to such
exception:
(a)
Organization
of Amici. Amici is a corporation duly organized and validly existing and in
good
standing under the laws of the State of Nevada, and has all requisite power
and
authority to own, lease and operate its properties and to carry on its business
as now being conducted. Amici is duly qualified as a foreign corporation to
do
business and is in good standing in every jurisdiction in which the nature
of
the business conducted or property owned by it makes such qualification
necessary, other than those in which the failure so to qualify would not have
a
material adverse effect on the business, operations, properties, prospects
or
condition (financial or otherwise) of Amici. Amici has, prior to the execution
of this Agreement, delivered or made available to the BQT Companies true and
complete copies of its (i) Certificate of Incorporation with all amendments
thereto; and (ii) By-laws, in each case as in effect on the date of Closing.
Amici is not in default under or in violation of any provision of its
Certificate of Incorporation or By-laws.
(b)
Authority.
(1) Amici has the requisite corporate power and authority to enter into and
perform its obligations under this Agreement; (2) the execution and delivery
of
this Agreement by Amici and the consummation by it of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
corporate action and no further consent or authorization of Amici or its Board
of Directors or stockholders is required; and (3) this Agreement has been duly
executed and delivered by Amici and constitutes a valid and binding obligation
of Amici enforceable against Amici in accordance with its terms, except as
such
enforceability may be limited by applicable bankruptcy, insolvency, or similar
laws relating to, or affecting generally the enforcement of, creditors' rights
and remedies or by other equitable principles of general
application.
(c)
No
Conflicts. The execution, delivery and performance of this Agreement by Amici
and the consummation by Amici of the transactions contemplated hereby, do not
and will not (1) result in a violation of the Certificate of Incorporation
or
By-Laws of Amici, or (2) conflict with, or constitute a material default (or
an
event that with notice or lapse of time or both would become a material default)
under, or give to others any rights of termination, amendment, acceleration
or
cancellation of, any material agreement, indenture, instrument or any "lock-up"
or similar provision of any underwriting or similar agreement to which Amici
is
a party, or (3) result in a violation of any federal, state, local or foreign
law, rule, regulation, order, judgment or decree (including federal and state
securities laws and regulations) applicable to Amici or by which any property
or
asset of Amici is bound or affected (except for such conflicts, defaults,
terminations, amendments, accelerations, cancellations and violations as would
not, individually or in the aggregate, have a material adverse effect on the
business, operations, properties, prospects or condition (financial or
otherwise) of Amici) nor is Amici otherwise in violation of, conflict with
or in
default under any of the foregoing. The business of Amici is not being conducted
in violation of any law, ordinance or regulation of any governmental entity,
except for possible violations that either singly or in the aggregate do not
and
will not have a material adverse effect on the business, operations, properties,
prospects or condition (financial or otherwise) of Amici. Amici is not required
under federal, state or local law, rule or regulation to obtain any consent,
authorization or order of, or make any filing or registration with, any court
or
governmental agency in order for it to execute, deliver or perform any of its
obligations under this Agreement (other than any SEC, FINRA or state securities
filings that may be required to be made by Amici subsequent to the Closing,
and
any shareholder approval required by the rules applicable to companies whose
common stock trades on the Over The Counter Bulletin Board); provided that,
for
purposes of the representation made in this sentence, Amici is assuming and
relying upon the accuracy of the relevant representations and agreements of
the
BQT Companies herein.
(d) Full
Disclosure. No representation or warranty made to the BQT Companies by Amici
in
this Agreement omits to state a material fact necessary to make the statements
herein, in light of the circumstances in which they were made, not misleading.
5.2 Representations
and Warranties regarding the BQT Companies. As
an
inducement to Amici to enter into this Agreement and to consummate the
transactions contemplated herein, each of the BQT Companies represents and
warrants to Amici as follows regarding matters pertaining to the BQT Companies,
all of which are true and complete as of the date of this Agreement and as
of
the Closing, except to the extent set forth on a disclosure schedule attached
hereto referencing the section and paragraph number of the provision herein
corresponding to such exception:
(a) Ownership.
Amici will receive good and transferable title to the Acquired Securities
pursuant to the terms of this Agreement, free and clear of all encumbrances.
There are no stockholders' agreements, voting trust, proxies, options, warrants,
convertible instruments, rights of first refusal or any other agreements or
understandings with respect to the Acquired Securities. Except
as
contemplated by this Agreement, there are no preemptive or similar rights to
purchase or otherwise acquire shares of the capital stock of the BQT Companies
pursuant to any provision of law, the Certificate of Registration or
Constitution (in each case, as amended and in effect on the date hereof), or
any
agreement to which any of the BQT Companies is a party.
(b)
Organization
of the BQT Companies. Each of the BQT Companies is a corporation duly organized
and validly existing and in good standing under the laws of the State of
Australia in which it is incorporated, and has all requisite power and authority
to carry on its business as now being conducted. Each of the BQT Companies
is
duly qualified to do business and is in good standing in every jurisdiction
in
which the nature of the business conducted or property owned by it makes such
qualification necessary, other than those in which the failure so to qualify
would not have a material adverse effect on the business, operations,
properties, prospects or condition (financial or otherwise) of the BQT
Companies. None of the BQT Companies is in default under or in violation of
any
provision of its Certificate of Registration or Constitution.
(c)
Authority.
(1) Each of the BQT Companies has the requisite corporate power and authority
to
enter into and perform its obligations under this Agreement and the agreements
contemplated hereby except shareholder approval where that is required by law
or
the Listing Rules of Australian Securities Exchange Ltd (“ASX
Listing Rules”);
(2)
the execution and delivery of this Agreement by each of the BQT Companies and
the consummation by it of the transactions contemplated hereby and thereby
have
been duly authorized by all necessary corporate action and no further consent
or
authorization of any of the BQT Companies or its Board of Directors or
stockholders is required except shareholder approval where that is required
by
law or the ASX Listing Rules; and (3) this Agreement has been duly executed
and
delivered by each of the BQT Companies and constitutes a valid and binding
obligation of each of the BQT Companies, enforceable against each of the BQT
Companies in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, or similar laws relating to,
or
affecting generally the enforcement of, creditors' rights and remedies or by
other equitable principles of general application.
(d)
Documents.
None of the BQT Companies have provided to Amici any information that contained
any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
(e)
Issuances.
When delivered as herein provided, the Amici Shares, the Satellite Shares and
the Security Shares shall be duly authorized, validly issued, fully paid.
Neither the issuance of the Acquired Securities pursuant to, nor any of the
BQT
Companies’ performance of its obligations under this Agreement shall result in
(1) the creation or imposition of any liens, charges, claims or other
encumbrances upon the Acquired Shares; or (2) the creation of rights of any
person to acquire additional shares of any of the BQT Companies.
(f)
No
Conflicts. The execution, delivery and performance of this Agreement by the
BQT
Companies and the consummation by the BQT Companies of the transactions
contemplated hereby, do not and will not (1) result in a violation of the
Certificate of Registration or Constitution of any of the BQT Companies, or
(2)
conflict with, or constitute a material default (or an event that with notice
or
lapse of time or both would become a material default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of, any
one
or more agreements that individually or in the aggregate are material,
indenture, instrument or any "lock-up" or similar provision of any underwriting
or similar agreement to which any of the BQT Companies is a party, or (3),
so
far as the BQT Companies are aware, result in a violation of any federal, state,
local or foreign law, rule, regulation, order, judgment or decree (including
federal and state securities laws and regulations) applicable to any of the
BQT
Companies or by which any property or asset of any of the BQT Companies is
bound
or affected (except, in the case of (2) and (3), for such conflicts, defaults,
terminations, amendments, accelerations, cancellations and violations as would
not, individually or in the aggregate, have a material adverse effect on the
business, operations, properties, prospects or condition (financial or
otherwise) of each of the BQT Companies or its ability to consummate the
transaction contemplated hereby) nor is any of the BQT Companies otherwise
in
violation of, conflict with or in default under any of the foregoing of which
it
is aware. The business of each of the BQT Companies is not being conducted
in
violation of any law, ordinance or regulation of any governmental entity, except
for possible violations that either singly or in the aggregate do not and will
not have a material adverse effect on the business, operations, properties,
prospects or condition (financial or otherwise) of any of the BQT Companies.
(g) Disclosures.
All forms, reports and documents required to be filed with all applicable
securities regulatory authorities (a) have been filed in a timely manner and
complied in all material respects with the applicable requirements of all
applicable laws and regulations and (b) did not at the time they were filed
(or
if amended or superseded by a filing prior to the date of this Agreement, then
on the date of such filing) contain any untrue statement of a material fact
or
omit to state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
6. Covenants
and Agreements of the BQT Companies. Each of the BQT Companies hereby covenants
and agrees as follows:
6.1 Within
five (5) business days of the date first set forth above, BQT Solutions will
have completed all necessary steps required by the ASX Listing Rules to seek
its
shareholders’ approval at a general meeting.
6.2 After
the
Consolidation, BQT Solutions will undertake a rights issue of up to
AUD$6,000,000 consisting of ordinary shares of BQT Solutions (the “Rights
Issue Shares”).
The
Rights Issue Shares shall be offered only to the existing shareholders of record
of BQT Solutions on a pro-rata basis as of the record date for the issue. To
the
extent that Rights Issue Shares are not taken up by any of the shareholders
to
whom the offer is made they shall be re-allocated for subscription to the
subscribing shareholders of record. The Rights Issue Shares shall be offered
at
a price per share of AUD$0.35.
6.3 BQT
Solutions will immediately commence all required corporate actions necessary
to
authorize and complete the Consolidation at a reduction ratio of 7-to-1 to
reduce outstanding BQT Solutions ordinary shares.
6.4 BQT
Solutions will subject to shareholder approval promptly upon recommendation
of
the newly appointed BQT Solutions Group CEO adopt a new corporate name which
brands the new global BQT security surveillance systems structure and
international business strategy.
6.5 BQT
Solutions will promptly commence all requisite actions necessary to register
all
of the Financing Shares and not less than 80% of all issued and outstanding
BQT
shares for trading in the United States on the Nasdaq or the New York Stock
Exchange (with such registration to be as American Depository Receipts,
“ADRs”)
and
Amici will procure that BQT Solutions has appropriate legal representation
in
the United States that enables BQT Solutions to comply with this Section 6.4
and
Section 6.6.
6.6 BQT
Solutions will, promptly upon recommendation of the newly appointed BQT
Solutions Group CEO, initiate the process of seeking supplemental listings
of
BQT Solutions shares on European stock exchanges, including Frankfurt, Milano,
London, and Swiss exchanges.
6.7 BQT
Solutions will register all of the Financing Shares as ADRs and will grant
rights to Amici to convert their BQT shares to registered ADRs.
6.8 BQT
Solutions will promptly and no later than May 31, 2008, seek any and all
corporate and regulatory consents necessary to execute the Consolidation and
the
issuance of the options described above, including without limitation, approval
of the grant of options to Amici and the Managers as specified in this Agreement
at the exercise price of AUD $0.10 per share without adjustment in respect
of
the Consolidation, or take alternative actions to obtain the same economic
result.
6.9 BQT
Solutions will promptly adopt and implement the corporate plan to be further
defined by the newly appointed BQT Solutions Group CEO.
6.10 The
BQT
Solutions Board will grant
the
newly appointed BQT Solutions Group CEO
a full
mandate over each of the BQT Companies to manage and complete the expansion
plan
referred to in the announcement made by BQT Solutions to the Australian
Securities Exchange on March 3, 2008. The BQT Solutions Group CEO will be
resident in Dubai in order to facilitate travel between Australia and Italy.
6.11 BQT
Solutions will use the AUD$4 million proceeds from issue of the Amici
Shares as follows:
| (a) |
AUD$1
million for working capital.
|
| (b) |
AUD$2.5
million for working capital and company
restructuring.
|
| (c) |
AUD$500,000
for public relations, investment relations, company promotion and
advisory
services.
|
6.12 Amici
will make the balance of the financing payments as follows:
|
(a)
|
AUD$680,000
of the AUD$4 Million purchase price for the Amici Shares will be
paid to
BQT Solutions upon BQT Solutions receiving all corporate and regulatory
consents necessary to execute the 7-to-1 Consolidation and the issuance
of
the options described above (but prior to the 7-to-1
Consolidation).
|
|
(b)
|
AUD$2,320,000
of the AUD$4 Million purchase price for the Amici Shares will be
paid to
BQT Solutions upon the completion of the 7-to-1
Consolidation.
|
|
(b)
|
AUD$14
Million will be paid in the form of an increase in share capital
but which
at the Closing Date will not materially dilute the percentage ownership
of
any other shareholder of BQT Satellites) upon fulfillment of the
conditions in Sections 6.3 and 6.5 hereof, of which AUD $1 Million
will be
used by BQT Satellites in connection with technology license and
acquisition contracts with Politechnico di
Torino.
|
7. Covenants
and Agreements regarding Manager Fees and Options.
7.1 BQT
Solutions and BQT Satellites agree to pay PAF and Arimathea
Limited (“Arimathea”)
in
accordance with their respective agreements with the Company (PAF and Arimathea
each, a “Manager”
and
collectively the “Managers”),
for
their respective work in facilitating the financings described above
(collectively, the “Financing”),
a
commission of eight per cent (8%) of the respective capital received from Amici
and introduced by the Managers (the “Commission”).
The Commission amount shall be paid via wire transfer as directed in writing
by
the Managers on the first business day following receipt by BQT Solutions of
the
Financing proceeds and pro rata in proportion to the funds received. For
purposes of clarity, there shall be no duplication of Commissions due or payable
to the Managers and the Commission is payable by the respective recipient
companies.
7.2 In
addition to the Commission, in further consideration for the respective work
of
the Managers on behalf of the BQT Companies in relation to the Financing, BQT
Solutions shall, subject to BQT Solutions shareholder approval, grant to each
Manager options for the issue of four million five hundred thousand (4,500,000)
ordinary shares of BQT Solutions (post Consolidation) at an exercise price
(post
Consolidation) of AUD $0.10 per share (the “Manager
Options”).
Upon exercise of any of the Manager Options, BQT shall apply for quotation
of
the underlying shares as soon as possible and in any event within five business
days after such exercise.
7.3 The
Manager Options will be issued after the BQT Solutions Consolidation and pro
rata in proportion to the funds received.
7.4 The
Manager Options shall be issued to the Managers at the address indicated by
the
respective Manager within five business days after BQT Solutions has received
a
total of AUD$3 million pursuant to the Second Tranche and Third Tranche payments
referred to in Section 1.1 hereof. The Manager Options may be exercised by
the
Managers at any time on or before December 31, 2013 by written notice to BQT
Solutions.
7.5 All
54,000,000 issued and outstanding BQT Solutions options previously granted
to
PAF will be amended so that they expire on or before December 31, 2008. After
the Consolidation, and subject to BQT shareholder approval, BQT Solutions shall
issue seven million seven hundred fourteen thousand two hundred eighty six
(7,714,286) new options that may be exercised at a purchase price of AUD$0.10
per share at any time but no later than December 31, 2013 (“New
Options”).
The full terms and conditions of the Manager Options and New Options shall
be
set forth in a supplemented written document, which shall be in form and
substance acceptable to the Mangers and which complies with the ASX Listing
Rules. The Managers will have the right to convert all BQT shares underlying
the
Manager Options and New Options (collectively, the “Manager
Shares”)
to
ADRs. BQT will register a sufficient number of ADRs for trading on the U.S.
Nasdaq or New York Stock Exchange to accommodate the conversion of all of the
Manager Shares to ADRs. Amici will procure that BQT Solutions has
appropriate legal representation in the United States that enables BQT Solutions
to comply with this Section 7.4. Upon exercise of any of the New Options, BQT
shall apply for quotation of the underlying shares as soon as possible and
in
any event within five business days after such exercise.
7.6 All
options held by current members of the BQT Solutions board of directors will
be
amended to expire on December 31, 2008 (the “Current
Director Options”).
After
the Consolidation, subject to BQT shareholder approval, BQT Solutions shall
issue new options in amount equal to seven times less than the prior respective
outstanding amount of such options and which shall be exercisable until December
31, 2013 (the “New
Director Options”).
The
New Director Options shall be issued at an exercise price of AUD$0.10 per share,
subject to substantially similar terms and conditions of vesting as of the
Current Director Options but the New Director Options may not be exercised
until
one year after the date of issue. The full terms and conditions of the New
Director Options shall be set forth in a supplemented written document which
shall be in the customary written format for Directors. The New Director Options
shall be exercised by written notice to BQT Solutions. Upon
exercise of any of the New Director Options, BQT shall apply for quotation
of
the underlying shares as soon as possible and in any event within five business
days after such exercise.
8.
Termination.
(a) This
Agreement shall terminate prior to the Closing upon the occurrence of any of
the
following: (i) the written agreement of the parties; (ii) the bankruptcy,
insolvency, receivership or involuntary dissolution of any of the parties;
(iii)
at the election of Amici if the covenants of BQT Solutions set forth in Section
6 of this Agreement shall not have occurred on or before June 30, 2008; (iv)
at
the election of Amici if the shareholders do not approve any and all of the
resolutions necessary to give this Agreement full force and effect; and (v)
at
the election of Amici if any event material adverse event occurs with respect
to
BQT Solutions (other than through failure of Amici to comply with its
obligations under this Agreement).
(b) In
the
event of the termination of this Agreement pursuant to Section 8, this Agreement
shall forthwith become null and void, and there shall be no further obligation
or liability hereunder on the part of any party hereto or its officers,
directors, or stockholders. Notwithstanding the foregoing sentence, the
provisions of this Section 8 and the provisions of Section 9 shall remain in
full force and effect and survive any termination of this Agreement.
9.
Miscellaneous.
(a)
Notices.
All notices or other communications required or permitted hereunder shall be
in
writing. Any notice, request, demand, claim or other communication hereunder
shall be deemed duly given (i) if by personal delivery, when so delivered;
(ii)
if mailed, three (3) business days after having been sent by registered or
certified mail, return receipt requested, postage prepaid and addressed to
the
intended recipient as set forth below; or (iii) if sent through an overnight
delivery service in circumstances to which such service guarantees next day
delivery, the day following being so sent to the address of the intended
recipient as first set forth above. Any party may change the address to which
notices and other communications hereunder are to be delivered by giving the
other parties notice in the manner herein set forth.
| Notice Address of Amici: | 4C Controls Inc. |
| 7th Floor |
Rockefeller
Center, 0000 Xxxxxx xx Xxxxxxxx,
Xxx
Xxxx, XX 00000
|
| Notice Address of BQT Companies: | Xxxxx 0, 00 Xxxxxx Xxxx |
| Xxxxx Xxxx XXX 0000 |
(b)
Choice
of
Governing Law and Dispute Resolution.
This Agreement shall be governed by and construed in accordance with the laws
of
the State of New York, without giving effect to any choice of law or conflict
of
law provision or rule (whether New York or any other jurisdiction) that would
cause the application of the laws of any jurisdiction other than New York.
Any
dispute, controversy or claim arising out of or relating to this contract,
including the formation, interpretation, breach or termination thereof,
including whether the claims asserted are arbitrable, shall be referred to
and
finally determined by arbitration administered by the American Arbitration
Association in accordance with its International Arbitration Rules. The tribunal
shall consist of a sole arbitrator. The place of arbitration shall be New York,
New York. The arbitration shall be conducted in English. The sole arbitrator
may
grant any remedy or relief, including but not limited to specific performance.
The prevailing party in any such arbitration shall be entitled to recover its
share of the arbitration costs, including but not limited to its attorneys’ fees
and any other costs incurred in its representation, in proportion to such
party’s award. Judgment upon the award rendered by the arbitrator may be entered
by any court having jurisdiction thereof.
(c)
Entire
Agreement. This Agreement sets forth the entire agreement and understanding
of
the parties in respect of the transactions contemplated hereby and supersedes
all prior and contemporaneous agreements, arrangements and understandings of
the
parties relating to the subject matter hereof including but not limited to
the
Original Proposal, the Revised Proposal, the Second Revised Proposal and the
First
Securities Purchase Agreement.
This
Agreement replaces the First
Securities Purchase Agreement and the First Securities Purchase Agreement is
now
null and void. No
representation, promise, inducement, waiver of rights, agreement or statement
of
intention has been made by any of the parties which is not expressly embodied
in
this Agreement, such other agreements, notes or instruments related to this
transaction executed simultaneously herewith, or the written statements,
certificates, schedules or other documents delivered pursuant to this Agreement
or in connection with the transactions contemplated hereby.
(d)
Assignment.
Each party's rights and obligations under this Agreement shall not be assigned
or delegated, by operation of law or otherwise, without the other party's prior
consent, and any such assignment or attempted assignment shall be void, of
no
force or effect, and shall constitute a material default by such
party.
(e)
Amendments.
This Agreement may be amended, modified, superseded or cancelled, and any of
the
terms, covenants, representations, warranties or conditions hereof may be
waived, only by a written instrument executed by each party, in the case of
a
waiver, by the party waiving compliance.
(f)
Waivers.
The failure of any party at any time or times to require performance of any
provision hereof shall in no manner affect the right at a later time to enforce
the same. No waiver by any party of any condition, or the breach of any term,
covenant, representation or warranty contained in this Agreement, whether by
conduct or otherwise, in any one or more instances shall be deemed to be or
construed as a further or continuing waiver of any such condition or breach
or a
waiver of any other term, covenant, representation or warranty of this
Agreement.
(g) Further
Assurances. BQT Solutions shall undertake all reasonable efforts to obtain
any and all third party approvals and consents necessary to implement this
Agreement. The parties shall promptly undertake on the same business day of
any
reasonable request and perform such additional acts and execute and deliver
such
additional documents and instruments as may be required or reasonably requested
by any party to establish, maintain or protect its rights and remedies or to
effect the purposes of this Agreement. Without limiting the foregoing, each
of
the BQT Companies hereby authorizes and agrees that Amici may fully disclose
the
matters pertaining to the Revised Proposal to the extent necessary for purposes
of Amici compliance with the laws, rules and regulations of the U.S. Securities
and Exchange Commission (the “SEC”),
and
each of the BQT Companies shall fully cooperate and be promptly fully responsive
in regard to any and all requests by Amici for information and deliveries of
all
materials, reports, audits and certifications required for SEC reporting and
disclosures in respect of the BQT Companies which must be made by Amici in
connection with the Revised Proposal and the transactions contemplated
thereunder, including, without limitation, delivering audited financial
statements in form and substance which are reasonably sufficient to permit
Amici
to comply with any and all of its SEC reporting obligations. Each of the BQT
Companies furthermore agrees to provide Amici with access to any and all books
and records of each of the BQT Companies as Amici may reasonably request and
to
coordinate with respect to controls and procedures as required under any and
all
laws, rules and SEC regulations applicable to Amici. If performance of this
Agreement in accordance with its terms would or might cause a breach of law
or
regulatory requirement or a tax or other cost that any of the parties considers
undesirable, the parties will co-operate to bring about such alternative as
would have, as nearly as possible, the same economic consequences as were
contemplated by the parties in this Agreement.
(h) Counterparts;
Interpretation. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, and all of which shall
constitute one and the same instrument. All references to “material” or
“materiality” herein shall refer to matters, understandings, agreements,
actions, courses of dealing, courses of operations, or events, which
individually or in the aggregate exceed AUD$100,000. All references to
“knowledge” means those facts or circumstances actually known after due inquiry.
No ambiguity in any provision hereof shall be construed against parties by
reason of the fact it was drafted by such party or its counsel. References
to
“including” means including without limiting the generality of any description
preceding such term. Nothing expressed or implied in this Agreement is
intended, or shall be construed, to confer upon or give any person other than
the parties any rights or remedies under or by reason of this Agreement.
(i) Acceptance
by Fax.
This
Agreement shall be accepted, effective and binding, for all purposes, when
the
parties shall have signed and transmitted to each other, by telecopier or
otherwise, copies of the signature pages hereto.
(j) Binding
Effect; Benefits.
This
Agreement shall inure to the benefit of, and be binding upon, the parties hereto
and their respective heirs, legal representatives, successors and permitted
assigns. Nothing in this Agreement, express or implied, is intended to or shall
confer upon any person other than the parties hereto, and their respective
heirs, legal representatives, successors and permitted assigns, any rights,
remedies, obligations or liabilities under, in connection with or by reason
of
this Agreement.
(k) Reporting.
Each of the BQT Companies acknowledges
that Amici is a public company subject to U.S. Federal securities laws. Each
of
the BQT Companies acknowledges
and agrees that it, and its subsidiaries, officers, directors, employees and
affiliates will not engage in any trading in Amici’s securities until after
public announcement of the acquisition in form and date to be determined by
Amici.
(l) Each
of
the parties hereto acknowledges that BQT Solutions is a public company subject
to the ASX Listing Rules and the Corporations Xxx 0000 of Australia. Nothing
in
this Agreement is intended to contravene the ASX Listing Rules or the
Corporations Xxx 0000 of Australia and to the extent there would otherwise
be
such contravention this Agreement shall be read and interpreted so that such
contravention will not occur.
[Signature
Page Follows]
IN
WITNESS WHEREOF, the parties hereto have duly executed this Agreement on the
date first set forth above.
| 4C CONTROLS INC. | ||
| |
|
|
| By: | /s/ Xxxxxx Xxxxxxxx | |
|
Name: Xxxxxx Xxxxxxxx |
||
| Title: Acting CEO and CFO | ||
|
Executed
by BQT
SOLUTIONS LIMITED
acting by the following persons or, if the seal is affixed, witnessed
by
the following persons:
|
|||
|
/s/Xxxxx
Xxxx
|
/s/
Xxxxxxxxxx Angeloglou
|
||
|
Signature
of director
|
Signature
of director
|
||
|
Xxxxx
Xxxx
|
Xxxxxxxxxx
Angeloglou
|
||
|
Name
of director (print)
|
Name
of director (print)
|
||
|
Executed
by BQT
SATELLITES LTD
acting by the following persons or, if the seal is affixed, witnessed
by
the following persons:
|
|||
| /s/ Xxxxxxxxxxx X. Xxxxx | /s/ Xxxxxxxxxx Angeloglou | ||
|
Signature
of director
|
Signature
of director
|
||
| Xxxxxxxxxxx X. Xxxxx | Xxxxxxxxxx Angeloglou | ||
|
Name
of director (print)
|
Name
of director (print)
|
||
|
Executed
by BQT
INTELLIGENT SECURITY SYSTEMS PTY
LTD
acting by the following persons or, if the seal is affixed, witnessed
by
the following persons:
|
|||
|
Signature
of director
|
Signature
of director/company secretary
|
||
|
Name
of director (print)
|
Name
of director/company secretary
(print)
|
