EXHIBIT 10.6
AMENDMENT NO. 1 TO SECURITIES PURCHASE AGREEMENT
This Amendment No. 1 to Securities Purchase Agreement (this
"Amendment"), dated January 23, 2003, is made by and among Sun Network Group,
Inc., a Florida corporation with its headquarters located at 0000 Xxxxxxxx
Xxxx., Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx 00000 (the "Company") and AJW
Partners, LLC, New Millennium Capital Partners II, LLC, AJW Offshore, Ltd.
(formerly AJW/New Millennium Offshore, Ltd.) and AJW Qualified Partners, LLC
(formerly Pegasus Capital Partners, LLC) (collectively, the "Investors").
WHEREAS:
The Company and the Investors are parties to that certain Securities
Purchase Agreement, dated June 27, 2002 (the "Securities Purchase Agreement");
and
The Company and the Investors desire to amend the Securities Purchase
Agreement as set forth below.
NOW, THEREFORE, the Company and the Investors hereby agree as follows:
1. Amendment of Section 4(l) of the Securities Purchase Agreement. Section
4(l) of the Securities Purchase Agreement is hereby amended and
restated to read in its entirety as follows:
"(L) SUBSEQUENT INVESTMENT. The Company and the Buyers agree
that, upon filing by the Company of the Registration Statement to be filed
pursuant to the Registration Rights Agreement (the "FILING DATE"), the Buyers
shall purchase additional debentures ("FILING DEBENTURES") in the aggregate
principal amount of Two Hundred Fifty Thousand Dollars ($250,000) and additional
warrants (the "FILING WARRANTS") to purchase an aggregate of 250,000 shares of
Common Stock, for an aggregate purchase price of Two Hundred Fifty Thousand
Dollars ($250,000), with the closing of such purchase to occur within ten (10)
days of the Filing Date; provided, however, that the obligation of each Buyer to
purchase the Filing Debentures and the Filing Warrants is subject to the
satisfaction, at or before the closing of such purchase and sale, of the
conditions set forth in Section 7. The Company and the Buyers further agree
that, upon the declaration of effectiveness of the Registration Statement to be
filed pursuant to the Registration Rights Agreement (the "EFFECTIVE DATE"), the
Buyers shall purchase additional debentures (the "EFFECTIVENESS DEBENTURES" and,
collectively with the Filing Debentures, the "ADDITIONAL DEBENTURES") in the
aggregate principal amount of Two Hundred Fifty Thousand Dollars ($250,000) and
additional warrants (the "EFFECTIVENESS WARRANTS" and, collectively with the
Filing Warrants, the "ADDITIONAL WARRANTS") to purchase an aggregate of 250,000
shares of Common Stock, for an aggregate purchase price of Two Hundred Fifty
Thousand Dollars ($250,000), with the closing of such purchase to occur within
five (5) days of the Effective Date; provided, however, that the obligation of
each Buyer to purchase the Effectiveness Debentures and the Effectiveness
Warrants is subject to the satisfaction, at or before the closing of such
purchase and sale, of the conditions set forth in Section 7; and, provided,
further, that there shall not have been a Material Adverse Effect as of such
effective date. The terms of the Additional Debentures and the Additional
Warrants shall be identical to the terms of the Debentures and Warrants, as the
case may be, to be issued on the Closing Date.
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The Common Stock underlying the Additional Debentures and the Additional
Warrants shall be Registrable Securities (as defined in the Registration Rights
Agreement) and shall be included in the Registration Statement to be filed
pursuant to the Registration Rights Agreement."
2. Amendment of Section 8(g) of the Securities Purchase Agreement. Section
8(g) of the Securities Purchase Agreement is hereby amended and
restated to read in its entirety as follows:
"(G) SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the parties and their successors and assigns.
Neither the Company nor any Buyer shall assign this Agreement or any rights or
obligations hereunder without the prior written consent of the other; provided
however, that subject to Section 2(f), any Buyer may assign its rights hereunder
to any person that purchases Securities in a private transaction from a Buyer or
to any of its "affiliates," as that term is defined under the 1934 Act, without
the consent of the Company, and provided further, that the Buyers shall not
assign this Agreement or any rights or obligations hereunder until the
completion of the subsequent investment pursuant to Section 4(l) hereof."
3. Amendment of Section 8(i) of the Securities Purchase Agreement. Section
8(i) of the Securities Purchase Agreement is hereby amended and
restated to read in its entirety as follows:
"(I) SURVIVAL. The representations and warranties of the
Company and the agreements and covenants set forth in Sections 3, 4, 5 and 8
shall survive the closing hereunder notwithstanding any due diligence
investigation conducted by or on behalf of the Buyers for a period of two (2)
years from the date that the subsequent investment is completed pursuant to
Section 4(l) hereof. The Company agrees to indemnify and hold harmless each of
the Buyers and all their officers, directors, employees and agents for loss or
damage arising as a result of or related to any breach or alleged breach by the
Company of any of its representations, warranties and covenants set forth in
Sections 3 and 4 hereof or any of its covenants and obligations under this
Agreement or the Registration Rights Agreement, including advancement of
expenses as they are incurred."
4. No Other Provisions or Documents Affected Hereby. This Amendment does
not affect any other provisions of the Securities Purchase Agreement or
the provisions of any other document entered into in connection with
the transactions set forth therein.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed as of the date first written above.
SUN NETWORK GROUP, INC.
/s/ T. Xxxxxx Xxxxxxx
______________________________________
T. Xxxxxx Xxxxxxx
President and Chief Executive Offer
AJW PARTNERS, LLC
By: SMS Group, LLC
/s/ Xxxxx X. Xxxxxxxx
______________________________________
Xxxxx X. Xxxxxxxx
Manager
AJW OFFSHORE, LTD.
By: First Street Manager II, LLC
/s/ Xxxxx X. Xxxxxxxx
______________________________________
Xxxxx X. Xxxxxxxx
Manager
AJW QUALIFIED, LLC
By: AJW Manager, LLC
/s/ Xxxxx X. Xxxxxxxx
____________________________________
Xxxxx X. Xxxxxxxx
Manager
NEW MILLENNIUM CAPITAL PARTNERS, LLC
By: First Street Manager II, LLC
/s/ Xxxxx X. Xxxxxxxx
____________________________________
Xxxxx X. Xxxxxxxx
Manager
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