AMENDMENT TO SECURITIES PURCHASE AGREEMENT
THIS AMENDMENT, dated as of October 3, 2005 (this "Amendment") is entered
into by and among the undersigned parties to amend the Securities Purchase
Agreement (the "Securities Purchase Agreement"), dated as of September 23, 2005
by and among Composite Technology Corporation and the Buyers party thereto.
Capitalized terms used in this Amendment without definition shall have the
respective meanings given to them in the Securities Purchase Agreement.
WHEREAS, the closing of the transactions contemplated in the Securities
Purchase Agreement is conditioned upon the Bankruptcy Court having entered an
order approving the Securities Purchase Agreement and the transactions
contemplated thereby in accordance with Sections 6(iv) and 7(xii) of the
Securities Purchase Agreement;
WHEREAS, the Bankruptcy Court commenced a hearing on September 28, 2005 to
consider entry of an order granting approval of the Securities Purchase
Agreement and the transactions contemplated thereby and such hearing was
continued until October 11, 2005;
WHEREAS, Section 8 of the Securities Purchase Agreement provides that in
the event the Closing has not occurred on or before September 30, 2005 (the
"Closing Deadline"), the parties have the option to terminate the Securities
Purchase Agreement;
WHEREAS, Section 3(b) of the Form of Note attached to the Securities
Purchase Agreement as Exhibit A thereto (the "Form of Note") to be issued
pursuant to Section 1(a) of the Securities Purchase Agreement defines
"Conversion Price" as $1.60 (the "Conversion Price");
WHEREAS, each of the undersigned wishes to amend the definition of
Conversion Price as contained in the Form of Note to an amount to be mutually
agreed upon on or before October 7, 2005, as well as other amendments to the
Form of Note;
WHEREAS, each of the undersigned wishes to amend the Securities Purchase
Agreement to extend the Closing Deadline subject to an agreement on the
Conversion Price by all parties set forth herein; and
WHEREAS, the Bankruptcy Court indicated in the hearing on September 28,
2005 that certain other provisions in the Securities Purchase Agreement must be
amended in order for the Bankruptcy Court to grant an order approving the
Securities Purchase Agreement and the transactions contemplated thereby and each
of the undersigned wishes to make such amendments.
NOW THEREFORE in consideration of valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each of the undersigned hereby
agrees as follows:
1. Extension of Closing Deadline. The Closing Deadline shall be extended
until 5pm Pacific Daylight Time on October 13, 2005; provided, however, that in
the event the parties cannot agree on a revised definition of Conversion Price,
as contained in the Form of Note, on or before 4pm Pacific Daylight Time on
October 7, 2005, the Securities Purchase Agreement shall immediately terminate
without further action by any party. In no event shall the Closing occur until
each of the undersigned agrees upon a revised definition of Conversion Price, as
contained in the Form of Note.
2. Use of Proceeds. Section 4(d) of the Securities Purchase Agreement
shall be amended and restated in its entirety and replaced in its entirety with
the following:
"The Company shall use the proceeds from the sale of the Securities for
working capital purposes, including payment of allowed administrative, priority
and general unsecured claims."
3. Amended and Restated Form of Note. The Form of Note shall be amended
and restated in its entirety and replaced by Exhibit I attached hereto.
4. Scope of Amendment. All other terms and provisions of the Securities
Purchase Agreement not expressly modified by this Amendment shall remain in full
force and effect and are hereby expressly ratified and confirmed; provided, that
representations and warranties contained in the Securities Purchase Agreement
..that relate to the "date hereof" shall continue to relate to September 23,
2005.
5. Section Headings; Construction. The headings of sections in this
Amendment are provided for convenience only and will not affect its construction
or interpretation. All words used in this Amendment will be construed to be of
such gender or number as the circumstances require. Unless otherwise expressly
provided, the word "including" does not limit the preceding words or terms.
6. Counterparts. This Amendment may be executed in counterparts, each of
which shall be deemed an original and each of which shall constitute one and the
same instrument.
7. Governing Law; Jurisdiction; Jury Trial. All questions concerning the
construction, validity, enforcement and interpretation of this Amendment shall
be governed by the internal laws of the State of New York, without giving effect
to any choice of law or conflict of law provision or rule (whether of the State
of New York or any other jurisdictions) that would cause the application of the
laws of any jurisdictions other than the State of New York. Each party hereby
irrevocably submits to the exclusive jurisdiction of the state and federal
courts sitting in The City of New York, Borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Amendment and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY
WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF
THIS AMENDMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
[Signature pages follow]
IN WITNESS WHEREOF, the parties have caused this Amendment to Securities
Purchase Agreement to be duly executed as of the date first written above.
COMPOSITE TECHNOLOGY CORPORATION
By: /s/ Xxxxxx X Xxxxxxxx
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Xxxxxx X Xxxxxxxx
Chief Executive Officer
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