AGREEMENT
BETWEEN
THINKPATH INC. & THE KENNEDYS
This Agreement (the "Agreement") is made and entered into effective as
of the 19th day of April 2007, among Thinkpath Inc., an Ontario corporation
("Issuer"), Thinkpath, Inc., an Ohio corporation and wholly-owned subsidiary of
Issuer ("Maker"), and ▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (the "Holders")
(collectively, the "Parties"). The purpose of this Agreement is to amend certain
elements of the provision governing merger consideration in Section 2.7 of the
Agreement and Plan of Merger (the "Merger Agreement") dated as of June 29, 2006
among Issuer, Maker, The Multitech Group, Inc., the Holders, and other parties.
In consideration of the mutual promises and covenants herein contained, the
receipt and sufficiency of which are hereby acknowledged, the Parties hereto
expressly agree as follows:
(A) TERMS AND CONDITIONS
(1) Upon the execution of this Agreement, Holders shall
(a) surrender and return to the Issuer for cancellation all of their
4,065,820 shares of the Issuer's common stock, of which 1,718,286
shares are owned by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, 1,145,525 shares are owned
by ▇▇▇▇ ▇▇▇▇▇▇▇ and 1,202,009 shares are jointly owned by the
Holders;
(b) surrender and return all of their 595 shares of the Issuer's
preferred stock to the Issuer for cancellation, of which 357
shares are owned by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and 238 shares are owned by
▇▇▇▇ ▇▇▇▇▇▇▇;
(c) return to the Maker for cancellation the Non-Negotiable
Promissory Notes (the "Merger Notes") with an aggregate amount of
$475,788 received and executed between the Maker and the Holders
on June 29, 2006 pursuant to the Merger Agreement; and
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(d) further cancel any payments due and payable to the Holders and
all penalties and obligations imposed upon the Maker or Issuer in
relation to the Merger Notes.
(2) Upon the execution of this Agreement, Maker shall
(a) be obligated to pay the aggregate amount of Eight Hundred
Thousand Dollars (U.S.) ($800,000) to the Holders as follows:
(i) installments of Thirteen Thousand Three hundred and
Thirty-Three Dollars and thirty-three cents ($13,333.33)(U.S.)
per month for 60 months (the "Monthly Payments"); and
(ii) the Monthly Payments shall be made on the fifteenth day of
each month, starting in January 2008, as memorialized in a
promissory note (the "New Note") attached thereto, as Exhibit A.
(b) pay interest at the annual rate of six percent (6%) on the
principal amount owned to Holders;
(c) have Issuer guarantee the Monthly Payment owed to the Holders.
The guarantee shall be in the form attached hereto as EXHIBIT B.
The Holders, subject to subordination as set forth in this
subsection, shall also have a security interest in all of the
Maker's and Issuer's assets. The security interest shall be
subordinated only to Laurus Master Fund, Ltd. and any subsequent
institutional financiers for any institutional debt up to an
aggregate of $8,000,000 (in the event that the Maker or Issuer
seeks institutional financing in excess of $8,000,000, such
additional institutional debt shall be subordinated to the
Holders unless the Holders otherwise agree to subordinate).
Issuer further agrees that until the principal and interest owed
under the New Note are paid in full, the New Note will be secured
by a security agreement attached hereto as EXHIBIT C, and Uniform
Commercial Code Financing statement attached hereto as EXHIBIT D,
giving Holders a security interest in all the patents, fixtures,
inventory, accounts receivable, and other assets of the Issuer
and/or any of its subsidiaries.
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(d) reaffirm and continue to be bound by the terms and conditions set
forth in the Employment Agreements executed pursuant to section
9.1(c) of Article IX and entered into between the Holders and the
Maker.
(e) pay any legal fee associated with disputes under the Merger
Agreement or Merger Notes or the negotiation and execution of the
New Note or this Agreement, provided that the aggregate amount of
such legal fees does not exceed Fifteen Thousand Dollars (U.S.)
($15,000).
(B) RIGHT TO SERVE ON THE BOARD
Until the New Note is paid in full, the Holders shall have the right to
and the Board of Directors shall have the obligation to include one designee,
reasonably acceptable to the Issuer, as a nominee to serve on the Issuer's Board
of Directors. Promptly upon execution of this Agreement, the Issuer will appoint
such nominee to serve as a Director until the next annual meeting of
shareholders.
(C) ENTIRE AGREEMENT
The Agreement contains all of the terms and conditions agreed upon
between the parties with respect to the subject matter hereof, and this
Agreement fully and completely expresses the Agreement of said parties on the
subject matter hereof. Further, in the event of any conflict between the terms
and provisions of this Agreement and the Merger Agreement, the terms and
provisions of this Agreement shall prevail and govern the obligations of the
Issuer and the Holders.
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(D) NO INFERENCE
It is specifically understood and agreed by and between the parties
that this Agreement and any exhibits annexed hereto are the result of extensive
negotiations between the parties. It is understood and agreed that both parties
shall be deemed to have drawn these documents in order to avoid any negative
inference by any court as against the preparer of the document.
(E) AMENDMENTS
The Agreement may not be changed, modified, supplemented or terminated,
nor may any obligations hereunder be waived, except by an instrument executed by
the parties hereto who are or will be affected by the terms of such change,
modification, supplementation or termination.
(F) NO WAIVER
No waiver by either party of any failure or refusal by the other party
to comply with its obligations shall be deemed a waiver of any other or
subsequent failure or refusal to so comply.
(G) SUCCESSORS AND ASSIGNS
Subject to the terms of the Agreement, the covenants, agreements and
representations, herein contained stipulations shall inure to the benefit of,
and shall bind, the heirs, administrators, successors and assigns of the
respective Parties hereto. The obligations of Issuer and Maker may not be
assigned without the consent of the Holders.
(H) GOVERNING LAW
The Agreement shall be governed by, interpreted under, and construed
and enforced in accordance with, the laws of the State of New Jersey applicable
to agreements made and to be performed wholly within said state.
(I) BINDING EFFECT
Facsimile signatures of the Issuer and Holders shall be deemed to be
originals and binding upon the parties.
(J) PARTIAL INVALIDITY
If any term or provision of this Agreement or the application thereof
to any person or circumstances shall, to any extent, be invalid or
unenforceable, the remainder of this Agreement, or the application of such term
or provision to persons or circumstances other than those as to which it is held
invalid or unenforceable, shall not be affected thereby, and each term and
provision of this Agreement shall be valid and be enforced to the fullest extent
permitted by applicable law.
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(K) MUTUAL LEGAL RELEASE
The Issuer, Maker, and the Holders, for themselves and anyone claiming
through them, hereby expressly release any and all of their respective legal
rights against each other or their respective representatives, heirs,
administrators, successors and assigns for any legal liabilities and claims
that may be currently existing, including but not limited to any claims arising
out of or related to fraud or misrepresentation of either party or breach of
contract arising out of or related to the Merger Agreement or Merger Notes.
However, this provision shall not release the Issuer, Maker or the Holder from
any of their obligations under this Agreement, the New Note, the guarantee of
the New Notes, or the other exhibits hereto.
IN WITNESS WHEREOF, the Issuer, Maker, and Holders have caused this
instrument to be duly executed by the undersigned.
DATE: APRIL __, 2007
ISSUER: THINKPATH INC., AN ONTARIO CORPORATION
By: _____________________________
Declan French
Chief Executive Officer
MAKER: THINKPATH INC., AN OHIO CORPORATION
By: _____________________________
Declan French
Chief Executive Officer
HOLDERS: ▇▇▇▇ ▇▇▇▇▇▇▇ AND ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
By: ________________________________
▇▇▇▇ ▇▇▇▇▇▇▇
By: ________________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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