AMENDING AGREEMENT TO SENIOR SUBORDINATED UNSECURED
CONVERTIBLE NOTES PURCHASE AGREEMENT OF JUNE 4, 1998
This Agreement dated as of October 23, 1998 is by and between
Officeland Inc., an Ontario corporation, with its principal place of business in
Toronto, Ontario (the "Company"), those purchasers who have executed and who are
identified in Exhibit A attached hereto and their respective affiliates
(individually, a "Purchaser" and collectively, the "Purchasers"), International
Capital Partners, Inc., a Connecticut corporation with its principal place of
business in Stamford, Connecticut ("ICP") and Bassini, Playfair + Associates
LLC, an Anguillan limited liability company with its principal place of business
in New York, New York ("BP").
The parties hereto are all of the parties to a Senior Subordinated
Unsecured Convertible Notes Purchase Agreement made as of the 4th day of June,
1998 (the "Purchase Agreement") and have agreed to amend the Purchase Agreement
as hereinafter set forth.
In consideration of the mutual promises and covenants contained in this
Agreement, and intending to be legally bound by the terms and conditions of this
Agreement, the parties hereto hereby agree as follows:
1. Definitions
1.1 Purchase Agreement Definitions All capitalized terms used in this
Agreement shall, unless expressly otherwise defined in this Agreement, have the
same meanings as given to them, respectively, in the Purchase Agreement. In some
instances, definitions of certain terms, which have been defined in the Purchase
Agreement, are repeated in this Agreement for ease of reference.
1.2 Additional Definitions In this Agreement, the following terms shall
have the following meanings, respectively:
(a) "Ardara" means Ardara Investment Inc.;
(b) "Bassini Group" means, collectively, BP and all of the
Purchasers other than Ardara;
(c) "Continuing Investors" means Ardara and such other investors
as may agree from time to time to purchase Convertible
Securities under the Restructured Purchase Agreement;
(d) "Convertible Securities" shall mean any evidences of
indebtedness, shares or other securities directly or
indirectly convertible into or exchangeable for Common Shares;
(e) "Special Stock" means, collectively, the Class A Stock and the
Restructured Rights Stock;
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(f) "Restructured Purchase Agreement" means, collectively, one or
more agreements of purchase and sale and any amendments
thereto entered into or to be entered into among ICP, the
Company and the Continuing Investors pursuant to which the
Company will sell and issue Convertible Securities to the
Continuing Investors for an aggregate purchase price not to
exceed $5,000,000 and which provide for one or more closings,
the last of which is no later than November 30, 1999;
(g) "Restructured Rights Terms" means the purchase and conversion
terms currently attaching to the Rights granted or to be
granted by the Company under the Restructured Purchase
Agreement, as more particularly set out in the term sheet
attached as Exhibit A hereto;
(h) "Restructured Rights Stock" means any special shares of any
class (other than the Class A Stock) which may be authorized
for issuance from time to time by the Company for the purposes
of the Restructured Purchase Agreement;
(i) "Rights" shall mean rights, options or warrants to subscribe
for, purchase or otherwise acquire Common Shares or
Convertible Securities;
2. Deeming Provisions
2.1 Aggregate Purchase Price Deemed Reduced The Initial Aggregate
Purchase Price shall be deemed to be the total principal amount of Senior Notes
to be purchased by the Purchasers under the provisions of the Purchase
Agreement. Any reference in the Purchase Agreement to an aggregate purchase
price of $7,000,000 shall be deemed to refer to $2,000,000. All of the
provisions in the Purchase Agreement relating to the Subsequent Aggregate
Purchase Price and the Subsequent Closings, including without limitation the
provisions of Sections 1.4(b), 1.7(b) and 2.2, shall be deemed to be deleted.
Notwithstanding the foregoing, each of the parties hereto acknowledges and
confirms that for all purposes under the Purchase Agreement and under the Senior
Notes, the Performance Ratio was not less than 90%.
2.2 Representations and Warranties All of the representations and
warranties on the part of each of the parties to the Purchase Agreement shall be
deemed to read as of the date of the Initial Closing only.
2.3 Representative Notwithstanding the provisions of section 4.5 of the
Purchase Agreement, all references in the Purchase Agreement and in this
Agreement to the "Representative" shall be deemed to refer to ICP only. For
greater certainty, the last sentence of section 4.5 of the Purchase Agreement is
hereby deleted and the following substituted therefor: In that regard, the
Representative shall be represented by: Xxxx X. Xxxxxxxxxx, on behalf of ICP,
for so long as he is surviving; thereafter by Xxxxxxxx X. Xxxxxxxx, on behalf of
ICP, for so long as he is surviving, and thereafter by a principal of ICP, or
such other person, approved by the Company, which approval shall not be
unreasonably withheld.
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3. Certain Covenants of the Company - Amendments to section 6 of the Purchase
Agreement
3.1 Financial Statements - Amendments to Section 6.1 Section 6.1 of the
Purchase Agreement is hereby amended by deleting therefrom every reference to
"the Purchasers" and substituting therefor a reference to the Representative.
3.2 Acquisition Committee - Amendments to Section 6.11 Section 6.11 of
the Purchase Agreement is hereby amended by deleting therefrom every reference
to "the Purchasers" and substituting therefor a reference to Ardara. The parties
hereto acknowledge and accept the resignation of Xxxxxx Xxxxxxxx as a member of
the Acquisition Committee and as a director of the Company. Xx. Xxxxxxxx shall
be initially be replaced on the Acquisition Committee and on the Board of
Directors by [o] on behalf of Ardara.
3.3 Adjustment to Purchase Price - Amendments to Section 6.13
(a) Subsection 6.13(a)(i) is hereby amended by deleting
the references to "Class A Stock" and substituting
therefor the words Special Stock; and
(b) Subsection 6.13(d)(iii) is hereby amended by deleting
the reference to "Class "A" Stock" and substituting
therefor the words Special Stock.
3.4 Anti-Dilution - Amendments to Section 6.14 Purchase Agreement,
Warrants and Class A Special Share Provisions
(a) Subsection 6.14(c)(i)(1) is hereby amended, at the
end of that subsection, by adding the words: and (C)
any Rights granted by the Company pursuant to the
Restructured Purchase Agreement, provided that the
terms attaching to such Rights are not materially
less favorable to the Company than the
Restructured Rights Terms;
(b) Subsection 6.14(c)(i)(3) is hereby amended, at the
end of that subsection, by adding the words: other
than any Rights excluded from the definition of
"Option" in Subsection 6.14(c)(i)(1);
(c) Subsection 6.14(c)(i)(4) is hereby amended, at the
end of that subsection, by deleting the reference to
Subsection 6.14(c)(i)(1)(A) and substituting therefor
the reference: Subsection 6.14(c)(i)(1);
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(d) Notwithstanding any provision to the contrary in the
Warrants or in the Class A Special Share Provisions
(as defined in the Articles of Amendment of the
Company filed June 4, 1998), Section 3.1 of the
Warrants and Subsection 5.7(5) of the Class A Special
Share Provisions shall be and are hereby deemed
respectively amended in the same manner as set out in
the foregoing provisions of this Section 3.4, mutatis
mutandis, and each of the Purchasers hereby expressly
authorizes and consents to the filing of articles of
amendment of the Company to give effect to such
amended Class A Special Share Provisions; and
(e) Each of the Purchasers hereby expressly approves the
creation and issuance of the Restructured Rights
Stock, notwithstanding any provision to the contrary
in the Class A Special Share Provisions and any
rights which might ultimately accrue to such
Purchaser with respect to such creation and issuance
as a holder of Class A Stock.
At the time of execution of this Agreement by the parties hereto, all Purchasers
shall surrender the Senior Notes issued to them on the Initial Closing for the
purposes of amending the endorsement which appears on the face page thereof to
refer to the Purchase Agreement as amended by this Agreement, which Senior
Notes, as amended, shall be forthwith returned to such Purchasers. All Warrants
and share certificates representing Class A Stock to be issued upon conversion
of the Senior Notes shall bear a legend to the effect that they are held subject
to the terms of the Purchase Agreement as amended by this Agreement.
4. Registration Rights
4.1 Registrable Securities All references in Section 7.1 to "Class
A Stock" are hereby deleted and the words Special Stock are
hereby substituted therefor;
4.2 Representative on behalf of holders All references in Sections
7.2 and 7.4 to "holders of at least 50% of the Registrable
Securities" are hereby deleted and replaced with the words
holders of at least 50% of the Restructured Rights Stock;
4.3 Demand Registration The parties agree that where a written
request from the Representative, as contemplated by Section
7.2(a) (as amended hereby), is made (the "Representative's
Request"), the Bassini Group shall be entitled, by written
notice to the Representative, delivered within 14 days
following receipt of a copy of the Representative's Request,
to have the Registrable Securities then held by the Bassini
Group included in the Representative's Request;
4.4 Piggyback Registration In Subsection 7.3(b)(4), the words "on
behalf of the Purchasers" in the second and third lines are
hereby deleted; and
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4.5 Registration Procedures In Subsection 7.5(b), the reference to
"the Purchasers" in the first line and the reference to "the
registering Purchasers" in the second last line are deleted
and replaced with the words the Representative.
5. Transfer of Rights
5.1 Transfer of Rights The references in Section 8.1 to "Class A Stock"
are hereby deleted and replaced, in each case, with the words Special Stock.
6. Voting Trust Agreement
6.1 Voting Trust Agreement Effective as of the date of this Agreement,
the Bassini Group shall no longer be parties to the Voting Trust Agreement. At
the time of execution of this Agreement by the parties hereto, the Bassini
Group, on the one hand, and the remaining parties to the Voting Trust Agreement,
on the other, shall exchange mutual releases, releasing one another from the
provisions of the Voting Trust Agreement.
7. Miscellaneous
7.1 Successors and Assigns. Except as otherwise expressly provided
herein, the provisions of this Agreement shall bind and enure to the benefit of
the respective successors, assigns, heirs, executors, and administrators of the
parties hereto.
7.2 Expenses. Each of the parties hereto shall bear its own legal and
other expenses in connection with the preparation and review of this Agreement
and the transactions contemplated by this Agreement.
7.3 Notices. All notices, requests, consents and other communications
under this Agreement shall be in writing and shall be delivered in the same
manner as provided in the Purchase Agreement.
7.4 No Conditions to Effectiveness; Entire Agreement. There are no
conditions to the effectiveness of this Agreement. The Purchase Agreement, as
amended by this Agreement, together with the instruments and other documents
contemplated to be executed and delivered in connection herewith, contains the
entire agreement and understanding of the parties hereto, and supersedes any
prior agreements or understandings between or among them, with respect to the
subject matter hereof.
7.5 Amendments and Waivers. Except as otherwise expressly set forth in
this Agreement, any term of this Agreement may be amended and the observance of
any term of this Agreement may be waived (either generally or in a particular
instance and either retroactively or prospectively), only with the written
consent of the party against whom such amendment or waiver is to be enforced. No
waivers of or exceptions to any term, condition or provision of this Agreement,
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in any one or more instances, shall be deemed to be, or construed as, a further
continuing waiver of any such term, condition or provision.
7.6 Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
7.7 Governing Law. This Agreement shall be governed by and interpreted
and construed in accordance with the laws of the Province of Ontario.
7.8 Currency. All dollar amounts referred to or contemplated herein
shall be in American funds.
7.9 Exhibits The following exhibits are attached to and form a
substantive part of this Agreement
Exhibit A - Purchasers
Exhibit B - Rights Term Sheet
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as an instrument as of the date first above written.
Bassini, Playfair + Associates LLC Officeland Inc.
By: /s/ Xxxxxx Xxxxxxxx By: /s/ Xxxxxx Xxxx
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Name: Xxxxxx Xxxxxxxx Name: Xxxxxx Xxxx
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Title: Principal Title: President
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International Capital Partners, Inc.
By: /s/ Xxxx Xxxxxxxxxx
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Name: Xxxx Xxxxxxxxxx
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Title: Chairman
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