First Amendment to Redemption and Securities Purchase Agreement
Exhibit
10.1
First
Amendment to
This
First Amendment to Redemption and Securities Purchase Agreement (this
“Amendment”)
is
made this 17th day of April, 2006, among ▇▇▇▇▇▇▇▇ Technologies, Inc., a Florida
corporation (“▇▇▇▇▇▇▇▇”),
and
the investors signatory hereto (each such investor is a “Investor”
and
all
such investors are, collectively, the “Investors”).
WHEREAS,
▇▇▇▇▇▇▇▇ and the Investors are parties to that certain Redemption and Securities
Purchase Agreement, dated as of March 24, 2006 (the “Original
Agreement”),
pursuant to which, among other things, a certain Investor, ▇▇▇▇▇ LLC, agreed
to
purchase and acquire from ▇▇▇▇▇▇▇▇, and ▇▇▇▇▇▇▇▇ agreed to sell and transfer
to
such Investor, shares of ▇▇▇▇▇▇▇▇’▇ Series E Preferred Stock, $0.001 par value
per share (the “Series
E Preferred Stock”);
and
WHEREAS,
the
parties hereto desire to amend the Original Agreement to reflect their mutual
agreement with respect to changes in (i) the dates of the Additional Closings,
(ii) the number of shares of Series E Preferred Stock to be sold at the
Additional Closings, (iii) the aggregate purchase price to be paid for such
shares at such Additional Closings and (iv) the Investor obligated to purchase
such shares of Series E Preferred Stock at such Additional Closings, and to
make
any other necessary changes resulting from the foregoing.
NOW
THEREFORE,
in
consideration of the premises and mutual covenants herein contained, the parties
agree as follows:
1. Capitalized
terms used herein and not otherwise defined herein shall have the respective
meanings ascribed to such terms in the Original Agreement.
2. Section
1.3 of the Original Agreement is hereby deleted in its entirety and the
following is hereby inserted in its place:
1
“(b) Subject
to the terms and conditions of this Agreement, (i) at a second closing to be
held on April
17, 2006
(or such
other date as may be agreed upon among the Investors and ▇▇▇▇▇▇▇▇) (the
“Second
Closing”),
▇▇▇▇▇▇▇▇ shall sell, and the Investors shall purchase, the number of Purchased
Series E Shares set forth on Schedule
B
under
the heading “Second Closing,” (ii) at a third closing to be held on April
26, 2006
(or such
other date as may be agreed upon among the Investors and ▇▇▇▇▇▇▇▇) (the
“Third
Closing”),
▇▇▇▇▇▇▇▇ shall sell, and the Investors shall purchase, the number of Purchased
Series E Shares set forth on Schedule
B
under
the heading “Third Closing,” (iv) at a fourth closing to be held on May
15, 2006
(or such
other date as may be agreed upon among the Investors and ▇▇▇▇▇▇▇▇) (the
“Fourth
Closing”),
▇▇▇▇▇▇▇▇ shall sell, and the Investors shall purchase, the number of Purchased
Series E Shares set forth on Schedule
B
under
the heading “Fourth Closing,” (v) at a fifth closing to be held on May
31, 2006
(or such
other date as may be agreed upon among the Investors and ▇▇▇▇▇▇▇▇) (the
“Fifth
Closing”),
▇▇▇▇▇▇▇▇ shall sell, and the Investors shall purchase, the number of Purchased
Series E Shares set forth on Schedule
B
under
the heading “Fifth Closing,” and (vi) at a sixth closing to be held on
June
15, 2006
(or such
other date as may be agreed upon among the Investors and ▇▇▇▇▇▇▇▇) (the
“Sixth
Closing”
and,
together with the Second Closing, the Third Closing, the Fourth Closing and
the
Fifth Closing, the “Additional
Closings”),
▇▇▇▇▇▇▇▇ shall sell, and the Investors shall purchase, the number of Purchased
Series E Shares set forth on Schedule
B
under
the heading “Sixth Closing.” Such Additional Closings shall take place at the
offices of ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLP, One International Place, Boston,
Massachusetts or at such other location as may be agreed upon among the
Investors and ▇▇▇▇▇▇▇▇. The
Initial Closing and the Additional Closings are sometimes collectively referred
to herein as the “Closings,”
and
each individually as a “Closing.””
3. With
respect to Additional Closings, Schedule
B
to the
Original Agreement is hereby amended and replaced with Schedule
B
to this
Amendment.
4. Notwithstanding
Section 1.2 of the Original Agreement, the total number of shares of Series
E
Preferred Stock constituting “Purchased Series E Shares” shall be 287.2, of
which 20 shares were sold at the Initial Closing and 267.2 shares will be sold
at Additional Closings (as described above). Accordingly, the shares of Series
E
Preferred Stock purchased at the Additional Closings (as described above) shall
constitute “Purchased Series E Shares” for all purposes of the Original
Agreement, as amended. Notwithstanding Section 1.2 of the Original Agreement,
the aggregate purchase price to be paid for such shares at each Additional
Closing shall be as set forth on Schedule
B
to this
Amendment.
5. The
shares of Series E Preferred Stock purchased at the Additional Closings (as
described above) shall constitute “Registrable Securities” for all purposes of
that certain Registration Rights Agreement, dated as of March 24, 2006, among
▇▇▇▇▇▇▇▇ and the Investors.
6. ▇▇▇▇▇▇▇▇
shall reserve an additional 240,600 shares of Technest Common Stock to secure
the conversion rights associated with the additional shares of Series E
Preferred Stock to be sold hereunder.
7. As
of the
date hereof, ▇▇▇▇▇ LLC is the owner of good and marketable title to 1915 shares
of ▇▇▇▇▇▇▇▇’▇ Series D Preferred Stock (the “Series
D Shares”),
free
and clear of all liens, pledges and encumbrances. ▇▇▇▇▇ LLC intends to transfer
the Series D Shares to Southridge Partners LP and Southshore Capital Fund Ltd.
The Investors covenant and agree that, notwithstanding the terms of the Series
D
Preferred Stock, and regardless of who owns the Series D Shares, upon the
conversion of any number of Series D Shares into 109,000,000 shares of
▇▇▇▇▇▇▇▇’▇ Common Stock, any remaining Series D Shares held by the Investors or
any of their Affiliates shall be forfeited to ▇▇▇▇▇▇▇▇ for no additional
consideration and shall no longer be considered outstanding. Promptly following
such conversion, the Investors shall deliver (or cause to be delivered) any
remaining Series D Shares, duly assigned to ▇▇▇▇▇▇▇▇, to ▇▇▇▇▇▇▇▇.
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8. The
Company has publicly announced its intention to distribute, as a dividend,
shares of Technest Common Stock to the holders of the Company’s Common Stock as
of May 1, 2006 (the “Record
Date”).
The
Company hereby confirms and agrees that, notwithstanding anything to the
contrary set forth in the Company’s Certificate of Designations of Rights and
Preferences of the Series D Preferred Stock (the “Series
D Certificate”),
in
connection with such stock dividend, it will issue, on the applicable payment
date for such dividend, to each holder of unconverted and unredeemed shares
of
Series D Preferred Stock as of the Record Date a number of shares of Technest
Common Stock equal to the number thereof which would have been issued to such
holder had all of the holder’s shares of Series D Preferred Stock outstanding on
the Record Date been converted into the Company’s Common Stock as of the close
of business on the trading day immediately preceding the Record Date. In
consideration therefor, each Investor agrees that, to the extent it or any
of
its Affiliates continue to hold shares of Series D Preferred Stock after the
Record Date, then, notwithstanding anything to the contrary set forth in the
Series D Certificate, neither it nor any of its Affiliates shall be entitled
to
participate in subsequent dividends or distributions by the Company with respect
to such shares of Series D Preferred Stock, regardless of whether such shares
of
Series D Preferred Stock are held by such Investor or its Affiliates as of
the
record date for such subsequent dividends or distributions, and each such
Investor hereby waives any and all rights it may have with respect to such
subsequent dividends or distributions under the Series D
Certificate.
9. Each
of
the parties hereto hereby represents that (i) such party has the power to
execute and deliver this Amendment, to perform the Agreement, as amended, and
to
consummate the transactions contemplated by the Agreement, as amended, and
(ii)
the Agreement, as amended, constitutes, and such other agreements, documents
and
instruments when executed and delivered will constitute, the legal, valid and
binding obligations of such party, enforceable in accordance with their
respective terms.
10. As
amended by this Amendment, the Original Agreement is in all respects ratified
and confirmed, and as so amended by this Amendment, the Original Agreement
shall
be read, taken and construed as one in the same instrument.
11. This
Amendment may be executed in any number of counterparts, each of which when
so
executed shall be deemed to be an original and, all of which taken together
shall constitute one and the same Amendment. In the event that any signature
is
delivered by facsimile transmission, such signature shall create a valid binding
obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile signature
were the original thereof.
****************
3
IN
WITNESS WHEREOF, the parties hereto have executed this Amendment the day and
year first above written.
|
▇▇▇▇▇▇▇▇
TECHNOLOGIES, INC.
|
|||
| By: | /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇ | ||
|
Name:
Title:
|
▇▇▇▇▇▇ ▇▇▇▇▇▇
Chief
Executive officer
|
[SIGNATURE
PAGE OF INVESTORS FOLLOWS]
4
[SIGNATURE
PAGE OF INVESTORS TO RSPA]
|
▇▇▇▇▇
LLC
|
|||
| By: | /s/ Illegible | ||
|
|
Name:
Title:
Navigator Management Ltd. -
Director
|
|
SOUTHRIDGE
PARTNERS LP
|
|||
| By: | /s/ Illegible | ||
|
|
Name:
Title:
|
|
SOUTHSHORE
CAPITAL FUND LTD.
|
|||
| By: | /s/ Illegible | ||
|
|
Name:
Title:
Navigator Management Ltd. -
Director
|
5
Schedule
B
Series
E Preferred Stock to be Purchased for Cash at Additional
Closings
The
following table sets forth the number of shares of Series E Preferred Stock
to
be purchased for cash by each Investor at each Additional Closing:
|
Investor
|
Second
Closing
|
Third
Closing
|
Fourth
Closing
|
Fifth
Closing
|
Sixth
Closing
|
|||||
|
Shares
|
Price
|
Shares
|
Price
|
Shares
|
Price
|
Shares
|
Price
|
Shares
|
Price
|
|
|
Southridge
Partners LP and
Southshore
Capital Fund Ltd., in the aggregate
|
92
|
$802,125
|
40
|
$348,750
|
40
|
$348,750
|
40
|
$348,750
|
55.2
|
$481,275
|
|
Total:
|
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