Exhibit 10.02
AMENDMENT TO
DEVELOPMENT AGREEMENT
This Agreement ("Agreement") entered into as of November 1, 2003 (the "Effective
Date") between Airos Group, Inc., an Ontario corporation, with offices at 000
Xxxxxxxx Xx., Xxxxxxxx, Xxxxxxx (the "Contractor") and Smart Chip Technologies,
a Florida corporation (the "Company"), with its corporate office at 000 X. Xxxx
Xxxxxxx Xx., Xxx Xxxxx, XX 00000 and an Administrative Office, which will be its
principal place of business for this Agreement, at 0000 X. Xxxxx Xx., #000, Xxxx
Xxxx Xxxx, XX 00000.
WHEREAS, Contractor has provided to Company contact with a sales
organization with whom the Company has subsequently entered a Sales and
Marketing Agreement; and
WHEREAS, the Company and the Contractor wish to amend their agreement
dated April 1, 2003, to provide appropriate compensation to Contractor,
effective November 1, 2003:
NOW, THEREFORE, in consideration of the agreements and covenants
contained herein, the Contractor and the Company hereby modify their April 1,
2003, Development Agreement as follows:
1. Services
1.1 (a) Term - This Agreement shall be for a term of five years (the
"Term") from the date of the original Development Agreement and shall be
terminable on the terms and subject to the conditions set forth in this
Agreement, and shall be extendable by mutual agreement.
2. Compensation
2.2 Fees & Personnel - Commencing from the Effective Date, Contractor
shall be compensated for Services rendered at a rate of eighty dollars (US $80)
per hour for each senior person, and sixty five dollars (US $65) per hour for QA
and lower-level technicians engaged on behalf of Contractor in the Project (the
"Fee"). The Fee, which will include all billable hours plus pre-approved travel
expenses, will be payable per the conditions listed below. Contractor will use
his best efforts to avoid changing the Project personnel once they have begun
work on the Project, unless it is absolutely necessary. Contractor shall be
responsible for the payment of all taxes including without limitation, all
Canadian and provincial, income, unemployment, social security and medicare
taxes. Conditions of payment:
(e) Contractor's options on the Company stock at the rate of
100,000 shares each month, continuing for two years from the
effective date of the original agreement, as long as there is
an outstanding balance of Deferred Fees, will be issued at a
strike price equal to 100% of the closing stock price on the
last business day of the month. The options will be issued
monthly and are exercisable within three years of issuance.
If Contractor has implemented and deployed all of the
following by May 1, 2005, the monthly option compensation, as
described above, will continue for another year:
i. A Global Platform and Multos solution on Smart Chips
ii. Two or more POS terminal platforms
iii. Magnetic stripe loyalty processing capabilities iv.
Loyalty by Product SKU
MR Airos Page 1 of 2 DS SCTN
2.3 Stock compensation - The Company shall compensate the Contractor by
issuance of twelve million, eight hundred thousand (12,800,000) shares of SCTN
stock, restricted by SEC rule 144. Eleven million three hundred thousand
(11,300,000) of these shares will be issued by the Company as soon as possible,
and the remaining one million, five hundred thousand (1,500,000) will be issued
upon execution of the first Customer order for Products procured by the sales
organization that exceeds an up front amount of $200,000 or a total contract
value of more than $1 million over the initial term of the contract. The eleven
million three hundred thousand shares will be issued in the names and amounts as
requested by Contractor. The costs of printing multiple certificates shall be
borne by Contractor.
5. Miscellaneous
5.2 Notices -
If to Company:
Smart Chip Technologies
0000 X. Xxxxx Xx., #000
Xxxx Xxxx Xxxx, XX 00000
6. Stock Purchase (New)
6.1 Qualified Investor - Contractor represents and warrants to the
Company that the Contractor is a Qualifies Investor, as defined by the SEC, and
hereby agrees to execute any necessary documents to disclose and stipulate that
fact per SEC regulations.
6.2 Stock Purchase - Contractor agrees to purchase two million
(2,000,000) of the Company's 144 restricted stock at a price of thirty cents
($0.30) US per share. Payment for this stock will be in the form of a Note
payable to the Company at the rate of twenty five thousand dollars ($25,000) per
month, for twenty four (24) months.
6.3 Note Payable to Company - Contractor agrees to execute an
interest-free Note, concurrently with this Amendment, secured by the assets of
the Airos Group, for six hundred thousand dollars ($600,000). Payments to the
Company will be made by Contractor, under this note, at the rate of twenty five
thousand dollars ($25,000) US per month, for twenty four (24) months, beginning
November 15, 2003. Payments more than ten (10) days late will be assessed a late
charge of three percent (3%) per month until paid.
All other terms and conditions of the April 1, 2003, Development
Agreement will remain as originally agreed.
IN WITNESS WHEREOF, each of the Company and the Contractor has caused
this Agreement to be signed by its duly authorized officer as of the day and
year first above written.
SMART CHIP TECHNOLOGIES AIROS GROUP INC.
By: /s/ Xxxxx Xxxxx By: /s/ Miki Radivojsa
------------------------ ---------------------------
Name: Xxxxx X. Xxxxx Name: Miki Radivojsa
Title:Chairman & CEO Title:President
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