SHAREHOLDER’S AGREEMENT
Exhibit 10.4 Shareholders’
Agreement between VT International, VCC and Nanotailor
THIS
SHAREHOLDER’S AGREEMENT (“Agreement”) is made
and entered into as of March 17, 2008 contemporaneously with the execution of an
Exchange Agreement (the “Exchange Agreement”)
between VT International Corp., an Arizona corporation, (“VT International”),
Visitalk Capital Corporation, a Nevada corporation (“VCC”), Nanotailor,
Inc., a Delaware corporation, (“Nanotailor”) and the
Nanotailor Shareholders. This Agreement is entered into by VT
International, VCC, Nanotailor and the Nanotailor Shareholders, jointly
hereinafter referred to as the “Parties” and will be
effective upon the Closing of the Exchange Agreement (the “Effective Date”) and
will be terminated and of no force and effect in the event the Exchange
Agreement is terminated. The Nanotailor Shareholders who receive
shares under the Exchange Agreement, through their Agent are confirming the
terms of this Agreement and are a Party hereto. The terms in this
Agreement, unless otherwise defined, have the same meaning as the terms used in
the Exchange Agreement.
RECITALS
A. Contemporaneously
with the date of this Agreement, VT International entered into an Exchange
Agreement with Nanotailor and the Nanotailor Shareholders.
B. The
Exchange Agreement contemplates the Call of certain Plan Warrants.
C. As
of the date of the Exchange Agreement, VCC owned 4,200,632 shares of VT
International common stock (the “VCC
Shares”).
D. VT
International, Nanotailor and the Nanotailor Shareholders desire to induce VCC
to vote to cause VT International to enter into the Exchange
Agreement.
AGREEMENTS
NOW
THEREFORE, in consideration of the foregoing and the covenants, terms and
conditions set forth herein, the parties hereby agree as follows:
Board of
Directors. Until the
Closing of the Exchange Agreement VCC will designate the Directors of VT
International.
Repurchase
Agreement.
Unless either an “Event of Default”, as
defined in Article “8” of this Shareholder’s Agreement, or a “Termination Event,”
as defined in Article “3” of this Shareholder’s Agreement, have occurred, VCC
shall have the right, commencing on the last day of the month (the “Put Date”) that is 18
months after the Closing occurs to cause the Company to repurchase some or all
of the VCC Shares (the “Put”) that VCC still
holds for $.15 per share (the “Put
Price”). Unless exercised by VCC, in its sole discretion, this
right to Put shall expire 30 days after the Put Date. If VT
International cannot pay the amount of the Put within five business days after
demand, VT International will issue a note secured on all the assets of VT
International for the amount of
the Put bearing interest at 18% per annum, payable monthly and due within 60
days (the “Put
Note”). Such Put Note, related security agreement and other
loan documents shall have customary terms and shall be in the form of Exhibit A
attached hereto.
Put
Termination Events. The Put shall relate to each existing VCC
Share and shall terminate on a per VCC Share basis under either of the following
conditions:
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(a)
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The
Put will be terminated in its entirety if VCC sells sufficient VCC Shares
in a private or public transaction with proceeds equal to the “Total Put
Price,” defined as the total number of VCC Shares times the Put
Price. VCC will report VT International’s remaining Put
liability at the end of each month by the 15th
day of the following month. Such report shall be via email to
VT International’s President or such party as the President
directs.
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(b)
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50%
of the Put will be terminated if VT International registers the VCC Shares
for sale with the SEC (the “Registration
Statement”) and such Registration Statement is deemed effective
(the “Registration Effective
Date”) by the Securities and Exchange Commission (the “SEC”).
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(c)
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Regardless
of the foregoing, the remainder of the Put will be terminated if starting
180 days after the Registration Effective
Date the Share-Dollar Volume exceeds an “Average Share-Dollar
Volume” of $50,000 per day during any subsequent 65 consecutive
Trading Day period. “Share-Dollar
Volume” is defined as the product of the average of the opening bid
price and the closing bid price times the daily volume of VT International
common shares sold. A “Trading Day”
means any day the New York Stock Exchange is
open.
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Maximum
VCC Shares available for VCC to sell. Regardless
of the other terms of this Agreement, but excluding the 50% of VCC’s Shares
which may be sold anytime without restriction upon the Registration Effective
Date, starting in the 2nd month after the Registration Effective Date, VCC will
not sell more than 150,000 shares per month.
5.
Affirmative
Covenants of VT International. During the term of this
Agreement, VT International which shall have acquired one hundred (100%) percent
of the issued and outstanding shares of Nanotailor, hereby covenants
and agrees:
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(a)
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Keep
in full force and effect and preserve VT International’s and Nanotailor’s
corporate existence, rights and franchises as existing on the Effective
Date, subject to the contemplated re-incorporation of VT International in
a new jurisdiction pursuant to the approval of
a majority of the issued and outstanding shares of common
stock;
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(b)
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Keep
and maintain the books and records of VT International, including all
minutes and regulatory filings and cause all transactions to be recorded
in accordance with generally accepted accounting principles (“GAAP”);
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(c)
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File
all tax returns and pay (i) all taxes, assessments and other governmental
charges imposed upon VT International or any of its properties or assets
or in respect of any of VT International’s franchises, business, income or
profits, (ii) pay all trade accounts payable in accordance with usual and
customary business terms, and (iii) pay all claims (including, without
limitation, claims for labor, services, inventory, materials and supplies)
for sums that have become due and payable and that by law have or might
become a lien or charge upon any of VT International’s properties or
assets; provided,
that no such tax, assessment, charge, account payable or claim need
be paid if being contested in good faith by appropriate proceedings
promptly initiated and diligently conducted and if such reserve or other
appropriate provisions, if any, as shall be required by GAAP shall have
been made therefore;
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(d)
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Maintain
or cause to be maintained in good repair, working order and condition any
properties (whether owned in fee or a leasehold interest) used or useful
in the business of VT International including the maintenance of
Nanotailor’s license with NASA for the use of NASA’s patents and, if
appropriate maintain or cause to be maintained, with financially sound and
reputable insurers, insurance with respect to its properties and business
against loss or damage of the kinds customarily insured
against;
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(e)
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Excluding
the Series A and Series B Plan Warrants, prevent the lapse or expiration
of any Plan Warrants in existence on the Effective
Date;
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(f)
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Maintain
a third party transfer agent for the VT International common stock and
Plan Warrants and promptly cooperate with VCC requests for any
transfers;
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(g)
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Maintain
a Blue Sky filing for VT International common shares and the Plan Warrants
through either the use of the Manual Exemption or methods of achieving
equal or better state coverage;
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(h)
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Use
it best efforts to become and reporting company, and thereafter ,maintain
its current reporting status under the Exchange Act of 1934 with the
Securities and Exchange Commission;
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(i)
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Use
its best efforts to create a trading market for the VT International
common shares and the remaining Plan Warrants of VT International, and
thereafter maintain a trading market for the VT International common
shares and the remaining Plan Warrants of VT
International.
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6. Negative Covenants and Actions Requiring VCC
Consent. After the Closing and while VCC
retains a common stock interest, VT International will not, and the Nanotailor
Shareholders will not authorize nor permit VT International as consolidated with
Nanotailor to take any of the following actions without the written consent of
VCC, which will not be unreasonably withheld or delayed:
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(a)
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Register
any other shares of VT International common stock under the 33 Act, except
as may be provided in the Exchange
Agreement;
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(b)
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Pay,
commit or accrue any fee payable to the Nanotailor Shareholders or their
affiliates except for reasonable compensation and reimbursement of
out-of-pocket expenses; or
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(c)
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Enter
into any agreement or undertake any obligation that requires VT
International to execute liens on its assets or have liabilities of more
than $500,000 at any time.
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7.
Covenants
by Nanotailor Shareholders. The
Nanotailor Shareholders hereby covenant and agree that they will take such
actions as necessary to allow or require the combined company to meet its
obligations under this Agreement. A limited number of shares of the
Nanotailor shareholders will be included on the Registration Statement as
specified on Schedule B, attached.
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8.
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Default
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(a)
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Events
of Default
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(i)
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A
default in the Exchange Agreement;
or
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(ii)
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A
default in any other agreement between VCC and VT International;
or
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(iii)
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A
default in this Shareholder’s Agreement;
or
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(iv)
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A
change of control of VT
International.
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(b)
Cure
Period. If any Event of Default, as defined in Paragraph “a” of
this Article “8” should occur , and such default is not cured within ten (10)
business days after receipt of notice, then the non-defaulting party, in its
sole and absolute discretion, may act pursuant to Article “9” of this
Agreement.
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9.
Remedies
for an Event of Default. In the Event of a Default, regardless
of the expiration of the Put, VCC may, in its sole discretion, Put its VCC
Shares to VT International at the Put Price and demand immediate
payment. VT International will file a UCC-1 reflecting this priority
claim on VT International’s assets and such lien shall be governed by the terms
of the Security Agreement referenced in Section 2 of this Agreement, except the
Put Note referenced thereby shall be a demand note and deemed
demanded.
10. Representations
of the VT International. VT International has all the
requisite authority to enter into this Agreement and indemnify VCC for any claim
otherwise.
11. Representations
of VCC. VCC has all the requisite authority to enter into this
Agreement.
12. Representations
of the Nanotailor and the Nanotailor Shareholders. Nanotailor
and the Nanotailor Shareholders have all the requisite authority to enter into
this Agreement and jointly and severally indemnify VCC for any claim
otherwise.
13. Costs and
Expenses. VT International shall bear all expenses of
performing under this Agreement including any expenses of filing and pursing a
registration statement with the SEC. However, VCC shall lend VT
International $50,000 specifically to pay for the costs of Registration
including audit costs, legal costs and other related out-of-pocket costs (the
“Expense LOC”). Loans
under the Expense LOC will be secured by a general lien on VT International’s
assets and shall be due in nine months from the Closing Date unless the
Registration statement is deemed effective in which case the amount of the loans
disbursed shall convert into common stock at 50% of the average market price for
the 10 Trading Days subsequent to the Registration Effective Date but not
greater than $.30 per share.
14. Right of
First Refusal. Until the Put is terminated VCC shall have the
Right of First Refusal to maintain its then percentage ownership interest at the
same price any VT International “New Securities” are
sold for. Such Right of First Refusal shall only be for shares issued
at a price net of all expenses and commissions less than the Put Price and have
customary terms. The term “New Securities” means any
shares of capital stock of VT International, whether now authorized or
authorized in the future, any rights, options or warrants to purchase any shares
of capital stock of VT International, including the Plan Warrants, and any other
securities of VT International of any type that are or may become convertible
into or exercisable for any shares of capital stock of VT
International.
15. Tag Along
Rights. If any
Nanotailor Shareholder receives an offer to purchase any of their Shares by a
third party, whereby such third party (including any affiliate or person or
persons that are acting in concert with such third party) would have Effective
Control of the outstanding voting shares of the Company, such Shareholder shall
not entertain, accept or otherwise negotiate such offer unless such offer is
extended to VCC
and all the VT International shareholders, on a pro-rata
basis. Effective Control is defined as ownership greater than
50%.
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16. Adjustment of share prices in the event of capital
restructuring.
In
the event of any capital restructuring, the share prices reflected in this
Agreement shall be adjusted as follows:
(a) If VT International shall at any time prior to the termination of this
Agreement declare or pay any dividend on its common stock payable in common
stock or common stock Equivalents, or effects a subdivision or combination of
the outstanding shares of common stock (by reclassification or otherwise than by
payment of a dividend in common stock or common stock Equivalents), then any
common stock prices in this Agreement shall be adjusted by
i. multiplying the price prior to
the adjustment by the number of shares of common stock (including all
common stock issuable in exchange for common stock Equivalents, if
applicable) outstanding immediately prior to the effective time of
such event; and
ii. dividing the foregoing result
by
A. in the case of a dividend,
the number of shares of common stock outstanding immediately after the
effective time of such event, or immediately after the close of
business on the record date for the determination of holders of
common stock entitled to receive such dividend, or
B. in the case of a subdivision
or combination, at the close of business immediately prior to the
date upon which such corporate action becomes effective.
(b)
If VT International shall at any time prior to the termination of this Agreement
make, or fix a record date for the determination of holders of common
stock entitled to receive a dividend or other distribution payable in
capital stock of VT International, other than shares of common stock
or common stock Equivalents, then such provision shall provide that
VCC shall receive, upon exercise of its rights, in addition to the
price specified, a price adjusted for the number of shares of common
stock receivable thereupon, the amount which VCC would have received had it
exercised its rights prior to such effective record
date.
(c)
All calculations under this Section shall be made to the nearest cent or to the
nearest whole share, with fractional shares being rounded up to
the nearest whole share if equal to or greater than one-half (½) share, and
fractional shares being rounded down to the nearest whole share if less than
one-half (½) share as the case may be.
17. Specific
Performance. The
parties hereto recognize and agree that damages for nonperformance of any
obligation herein would be an inadequate remedy and that the covenants and
agreements herein set forth shall be specifically enforceable.
18. Notices. Any notice required or
permitted by this Agreement shall be in writing and delivered personally or sent
by registered or certified mail addressed to VT International at its registered
office or to the Nanotailor Shareholders at their addresses shown in VT
International’s stock record book, with a copy to Xxxxx & Fraade, P.C.; 000
Xxxxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, XX 00000, attn: Xxxxxxxxx X. Xxxxx, Esq.,
or at such other address as any Party shall substitute by written notice to all
other parties. Any notice given hereunder shall be effective, when
sent by certified mail, postage prepaid, return receipt requested on the day
following the date of deposit in the United States mail, and
addressed as set forth herein. VT International shall notify VCC of
the addresses of the Nanotailor Shareholders and any changes
thereto.
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19. Severability. In the event any provision
of this Agreement shall be held invalid or unenforceable, the remainder of this
Agreement shall continue in full force and effect as if such invalid or
unenforceable provision were not written herein.
20. Choice of
Law and Venue. This Agreement
shall be governed by and interpreted and construed in accordance with the laws
of the State of Arizona without regard to choice of law
principles. Venue for any litigation shall be in the courts of
appropriate jurisdiction in Maricopa County, Arizona.
21. Survival
of Agreement terms. All the terms of this Agreement shall
survive until the earlier to occur of: (A) the termination of the Put
and VCC or has sold all its VCC Shares; or (B) 30 months after the
Closing.
22. Entire
Agreement; Amendment.
This Agreement contains the entire understanding and agreement of the
parties as to the subject matter hereof and may be amended only by written
agreement of all parties who are then bound by the terms hereof. The
Nanotailor Shareholders specifically appoint their Agent to execute any
amendments to this Agreement on their behalf.
23. Binding
Effect. This
Agreement shall bind and inure to the benefit of the Parties and their
successors, assigns, respective heirs and personal representatives.
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date
first above written
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VT
International Corp.
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Visitalk
Capital Corporation
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/s/
Xxxxxxx X. Xxxxxxxx
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/s/
Xxxxxxx X. Xxxxxxx
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By:
Xxxxxxx X. Xxxxxxxx
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By:
Xxxxxxx X. Xxxxxxxx
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Its: President
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Its: President
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Nanotailor,
Inc. as Agent for all the Nanotailor Shareholders
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/s/
Xxxxx Xxxxxxx
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/s/
Xxxxx Xxxxxxx
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By:
Xxxxx Xxxxxxx
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By:
Xxxxx Xxxxxxx
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Its: President
& CEO
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Its: President
& CEO
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Attachments:
Exhibit
A: Form of Put Note and Security Agreement
Schedule
B: Shareholders and shares to be registered
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