EXHIBIT 1
MFC BANCORP LTD.
Xxxxx 00, Xxxxxxxxx Xxxxx
Xxxxxxxxxx 00-00, X-0000
Xxxxxx, Xxxxxxx
April 29, 2003
CONCORD EFFEKTEN XX
Xxxxxx Xxxxxxxxxxxxx 0 00000
Xxxxxxxxx xx Xxxx, Xxxxxxx
Dear Sirs:
RE: EQUIDYNE CORPORATION ("EQUIDYNE" OR THE "COMPANY")
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We write further to our past discussions regarding your beneficial ownership of
1,200,000 shares of common stock in the capital of Equidyne (the "Equidyne
Shares") and the 2003 annual meeting of the stockholders of Equidyne for fiscal
2002, or any adjournment or postponement thereof (the "2003 Meeting") and any
other meeting of shareholders of Equidyne or any adjournment or postponement
held during the term of this Agreement (together with the 2003 Meeting, each a
"Meeting").
In connection therewith, you and we wish to enter into this agreement (the
"Agreement") to set forth the basis upon which the Equidyne Shares shall be
voted at the Meeting or any adjournment or postponement thereof and a potential
reorganization of Equidyne's board of directors.
In order to proceed, we confirm that, in consideration of the representations,
warranties, covenants and agreements contained in this Agreement, you and we
hereby severally represent, warrant, covenant and agree as follows:
1. You hereby irrevocably agree that at the 2003 Meeting (and any Meeting
held before it) you shall provide to us, upon request, proxies and otherwise
take such actions as may be required or desirable to vote the Equidyne Shares
(and any other shares of Equidyne you have the ability to vote at the relevant
time) in favour of any nominees ("nominees") for election as directors of
Equidyne put forth by us and otherwise as directed by us with respect to any
proposal before the stockholders of Equidyne, including, but not limited to,
proposals at a Meeting, and against any resolution authorizing or approving a
specific business transaction which has not been approved by our nominees or by
us. You shall also comply with this Section 1 in respect of all other Meetings
in respect of the amount of Equidyne Shares then owned or controlled by you. We
will inform you about our nominees not later than 5 days before any scheduled
Meeting.
2. You shall do and cause to be done all acts and execute and cause to be
executed all documents that may be requested in writing by us to ensure the
exercise of the voting rights appertaining to the Equidyne Shares, in accordance
with the terms of this Agreement.
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3. We shall use reasonable commercial efforts to try to achieve a
reorganization of Equidyne's board of directors so as to try to permit an
enhancement in value for your Equidyne Shares, provided that no assurance,
representation or warranty is being provided by us to you herein, all of which
is expressly disclaimed.
4. Until after the vote in the 2003 Meeting is completed, you shall not,
directly or indirectly, sell, transfer, assign or otherwise dispose of any
Equidyne Shares or any interest therein or take any action that could adversely
affect your ability to vote the same pursuant to the terms hereof.
5. From and after the completion of the 2003 Meeting, if you receive a bona
fide written offer (an "Offer") from any person, firm or corporation dealing at
arm's length with you to purchase by way of private sale all or any part of the
Equidyne Shares, you shall give notice of such Offer (the "Notice") to us and
shall set out in the Notice the number of Equidyne Shares to be sold pursuant to
the Offer (the "Offered Shares") and the terms upon which and the price at which
(the "Purchase Price") such Offered Shares will be sold pursuant to the Offer.
Upon the Notice being given, we shall have the right to purchase all, but not
less than all, of the Offered Shares for the Purchase Price by giving notice to
you, within 24 hours of having received the Notice, that we wish to exercise
such right. If we are willing to purchase all, but not less than all, of the
Offered Shares, the transaction of purchase and sale shall be completed in
accordance with the terms set out in the Notice. If we do not give notice in
accordance with the provisions of this section that we are willing to purchase
all of the Offered Shares, our rights to purchase the Offered Shares shall
forthwith cease and terminate and you may sell the Offered Shares to the third
party purchaser for a price not less than the Purchase Price and on other terms
no more favourable to such person than those set forth in the Notice.
Notwithstanding anything else in Sections 4 and 5 hereof, nothing herein will
restrict you from making bona fide sales of all or part of the Equidyne Shares
through the facilities of a stock exchange from and after the vote in the 2003
Meeting is completed.
6. You hereby grant to us the right (the "Call Option"), exercisable at any
time until the earlier of the date that is 60 days after the date of the 2003
Meeting is completed or August 31, 2003, to require you to sell to us up to
485,844 of the Equidyne Shares (the "Optioned Securities") for $0.45 per share
(the "Call Option Consideration"). We may exercise the Call Option by giving to
you notice in writing (the "Exercise Notice") of our intention to exercise the
Call Option, and shall set out in such notice the number of Optioned Securities
we wish to purchase pursuant to the Call Option (the "Purchased Securities").
Upon the exercise of the Call Option, the Exercise Notice delivered in respect
thereof and this Agreement shall together constitute a binding agreement of
purchase and sale between you and we regarding the Purchased Securities, and the
sale and purchase of the Purchased Securities (the "Closing") shall be
completed within twenty-one (21) business days following receipt by you of the
Exercise Notice or on such other date that you and we may agree to in writing
(the "Closing Date") on the following terms and conditions:
(a) the Closing shall occur at suite 1000 - 000 Xxxx Xxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx, or at such other place that you and we may
agree to in writing, at 9:00 am (Pacific Standard Time) on the Closing Date;
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(b) the consideration payable by us for the Purchased Securities shall be
the Call Option Consideration multiplied by the number of Purchased Securities,
payable by certified cheque or bank draft delivered at the Closing;
(c) you shall duly and validly transfer and deliver or cause to be delivered
to us at the Closing the Purchased Securities;
(d) upon the exercise of the Call Option and delivery of the consideration
payable for the Purchased Securities, the Purchased Securities shall be and be
deemed to have been transferred to us and we shall be and be deemed to have
become the holder of Purchased Securities; and
(e) the Purchased Securities shall be free and clear of any liens,
mortgages, charges and encumbrances whatsoever and we shall receive good and
marketable title thereto.
This Section 6 does not apply if during the duration of this Agreement the
average trading price for the common shares of Equidyne as reported on the
American Stock Exchange exceeds the Call Option Price for a period of 5
consecutive trading days other than as a result of or related to events caused
or actions taken by us.
7. We will inform you when you are obliged to file a document with the U.S.
Securities and Exchange Commission (SEC-Filing) in connection with this Call
Option and, in case you are obliged to file a SEC-Filing, we will assist you in
doing so.
8. You covenant, represent and warrant as follows and acknowledge and
confirm that we are relying upon such covenants, representations and warranties
in connection with the entering into of this Agreement:
(a) you have duly executed and delivered this Agreement and this Agreement
constitutes a legal, valid and binding obligation enforceable against you in
accordance with its terms, except to the extent enforceability may be limited by
bankruptcy, insolvency, moratorium or other laws affecting creditors' rights
generally or by general principles governing the availability of equitable
remedies;
(b) you are the beneficial owner of the Equidyne Shares and have the ability
to direct the voting of the Equidyne Shares;
(c) you have not granted, issued or provided to any person a proxy or other
instrument or document authorizing or entitling, or purporting to authorize or
entitle, any person to exercise any voting rights attached to the Equidyne
Shares, including, without limitation, the right to vote the Equidyne Shares at
the Meeting or any adjournment or postponement thereof or at any meeting of the
stockholders of Equidyne;
(d) no person, firm, partnership, trust or corporation, other than us, has
any agreement or option capable of becoming an agreement or option for the
purchase,
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acquisition or transfer of any of the Equidyne Shares or any interest therein or
any right thereto;
(e) you have all the necessary power and authority to execute and deliver
this Agreement and to perform or cause to be performed your obligations
hereunder;
(f) the execution, delivery and performance of this Agreement by you does
not conflict with or violate any of your organizational documents or any
agreement, arrangement, law, rule, regulation, order or decree to which you are
a party or by which you are bound or affected;
(g) you have not any prior dealings with us or any of our affiliates or
associates and you have only dealt at arm's-length with us and our affiliates
and associates; and
(h) you shall not sell, assign or transfer the Equidyne Shares, other than
to us, as permitted pursuant to Sections 4, 5 and/or 6 hereof or as agreed to in
writing by us.
9. We covenant, represent and warrant as follows and acknowledge and confirm
that you are relying upon such covenants, representations and warranties in
connection with the entering into of this Agreement:
(a) we have duly executed and delivered this Agreement and this Agreement
constitutes a legal, valid and binding obligation enforceable against us in
accordance with its terms, except to the extent enforceability may be limited by
bankruptcy, insolvency, moratorium or other laws affecting creditors' rights
generally or by general principles governing the availability of equitable
remedies;
(b) we have all the necessary power and authority to execute and deliver
this Agreement and to perform our obligations hereunder; and
(c) we have not, nor have any of our affiliates or associates had, any prior
dealings with you and we and our affiliates and associates have only dealt at
arm's-length with you.
10. This Agreement shall enure to the benefit of and be binding upon the
parties and, save as otherwise herein provided, their respective heirs,
executors, administrators, successors and assigns.
11. This Agreement constitutes the entire agreement between the parties with
respect to the subject matter hereof and supersedes all prior agreements and
understandings, both written and oral, with respect to the subject matter
hereof.
12. If any term or other provision of this Agreement is invalid, illegal or
incapable of being enforced by any rule or law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of this Agreement is
not affected in any manner materially adverse to any party. Upon such
determination that any term or other provision is invalid, illegal or
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incapable of being enforced, the parties hereby shall negotiate in good faith
to modify this Agreement so as to the effect the original intent of the parties
as closely as possible to the fullest extent permitted by applicable law in
a mutually acceptable manner in order that the terms of this Agreement remain as
originally contemplated.
13. The parties hereto agree that irreparable damage would occur in the event
any provision of this Agreement was not performed in accordance with the terms
hereof and that the parties shall be entitled to specific performance of the
terms hereof, in addition to any other remedy at law or in equity. The parties
hereto agree that no party shall be entitled to punitive or exemplary damages.
14. This Agreement shall be governed by and construed in accordance with
German law. Place of jurisdiction is Frankfurt am Main, Germany.
15. You and we will perform and cause to be performed such further and other
acts and things and execute and deliver or cause to be executed and delivered
such further and other documents as may be necessary or desirable to carry out
the terms and intent of this Agreement.
16. Any notice or other document required or permitted to be given pursuant
to this Agreement shall be validly given if delivered or sent by registered
mail, postage pre-paid, to the address of the addressee as follows:
(a) if to Concord Effekten AG:
Grosse Xxxxxxxxxxxxx 0 00000
Xxxxxxxxx xx Xxxx, Xxxxxxx
Attention: Xxxxxx Stewens
Facsimile No.: x00 00 00000-000
(b) if to MFC Bancorp Ltd.:
0000 - 000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, X.X. X0X 0X0
Attention: H.S. Sangra
Facsimile No.: (000) 000-0000
Any notice or other document given by mail as aforesaid shall be deemed to have
been received on the fifth day following the date on which such notice or
document was mailed. In lieu of notice by mail as aforesaid, any notice or
other document required or permitted to be given pursuant to this Agreement may
be validly given if delivered to the address, or transmitted by facsimile to the
facsimile number, of the addressees set forth above and such notice or document
so delivered shall be deemed to have been given at the time of delivery.
17. As between ourselves, you will not be responsible for any costs or
expenses incurred by us related to or resulting from the nomination by us of
directors for election by the stockholders of Equidyne or the solicitation of
proxies by us in respect of the Meeting, or any actions or proceedings related
thereto and we will indemnify you and hold you
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harmless from and against any costs, claims, expenses or liabilities that you
may reasonably suffer or incur arising out of this Agreement (provided you are
not in breach thereof) and the performance of your obligations hereunder.
18. This Agreement shall remain in effect until June 30, 2004 and shall
terminate effective 5:00 p.m. (Pacific Standard Time) on such date, provided
that if we do not nominate any persons for election as directors of Equidyne at
its 2003 annual meeting, this Agreement will terminate effective the later of
the conclusion of such meeting or the final resolution of any actions or
proceedings related to or resulting from such meeting.
If you are in agreement with the foregoing, please execute a copy of this
Agreement where indicated and return the same to us. This Agreement may be
executed in counterpart and by facsimile and such parts as so executed shall
together constitute one original document, and such parts, if more than one,
shall be read together and construed as if all the signing parties had executed
one copy of the Agreement.
Yours truly,
MFC BANCORP LTD.
By: /s/ Xxx Xxxxxxx
_________________________________________
Agreed to and accepted this 30 day of April, 2003
CONCORD EFFEKTEN AG
By: /s/ Xxxxxxxx Xxxxxxx /s/ Xxxxxx Stewens
_________________________________________
