Exhibit 10.2
SUBORDINATED NOTE PURCHASE AGREEMENT
This SUBORDINATED NOTE PURCHASE
AGREEMENT dated as of August 30, 2007 (this
“Agreement”) by and among Brookside Technology Holding
Corp., a Florida corporation (the “Company”), and
Dynamic Decisions Growth Premium and Dynamic Decisions Strategic
Opportunities (collectively, the “Purchaser”).
In consideration of the foregoing
recitals and for good and other valuable consideration hereinafter
set forth, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. Subordinated
Note . Purchaser shall loan to the Company $1,000,000 on
the terms set forth in the Subordinated Promissory Note attached
hereto as Exhibit 1 (the “Note”).
Purchaser acknowledges that the loan is fully subordinated to all
of the Company’s senior lenders and agrees to enter into a
subordination and/or intercreditor agreement with such lenders.
Purchaser has reviewed all of the Company’s filings with the
Securities and Exchange Commission (the “SEC”),
including all of the risk factors contained therein. Purchaser
acknowledges that its obligation to provide the loan is not
contingent on the closing of any acquisition or equity raise by or
on behalf of the Company and that the Company may not be able to
continue as a going concern, as set forth in the Company SEC
filings. However, if the Company raises equity in excess of
$600,000 between the date hereof and December 31, 2007, the
net amount of such excess shall be applied to repay any amounts
that remain outstanding under the Note, unless such repayment is
prohibited by the Company’s senior lenders. Similarly, if the
Company raises equity after December 31, 2007, the net amount
raised by the Company shall be applied to repay any amounts that
remain outstanding under the Note, , unless such repayment is
prohibited by the Company’s senior lenders.
2. Warrants . In
consideration of the forgoing loan, the Company shall issue to
Purchaser a warrant to purchase 10,000,000 shares of the
Company’s common stock at an exercise price per share of
$0.114 on the terms set forth in the Warrant attached hereto as
Exhibit 2 (the “Warrant”).
3. Representations and
Warranties . Purchaser hereby represents and warrants to
the Company as follows:
a.
Organization and Standing . If Purchaser is an entity,
Purchaser is a corporation, limited liability company or
partnership duly incorporated or organized, validly existing and in
good standing under the laws of the jurisdiction of its
incorporation or organization.
b.
Authorization and Power. Purchaser has the requisite power
and authority to enter into and perform this Agreement, the Note
and the Warrant (collectively, the “Transaction
Documents”) and to purchase or otherwise acquire the Note and
the Warrants (collectively, the “Securities”). The
execution, delivery and performance of the Transaction Documents by
Purchaser and the consummation by it of the transactions
contemplated hereby have been duly authorized by all necessary
corporate or partnership action, and no further consent or
authorization of Purchaser, as applicable, or its Board of
Directors, stockholders, or
partners, as the case may be, is required. The Transaction
Documents constitute valid and binding obligations of Purchaser
enforceable against Purchaser in accordance with their terms,
except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation,
conservatorship, receivership or similar laws relating to, or
affecting generally the enforcement of, creditor’s rights and
remedies or by other equitable principles of general
application.
c.
Acquisition for Investment . Purchaser is acquiring the
Securities solely for its own account and not with a view to or for
sale in connection with distribution. Purchasers does not have a
present intention to sell any of the Securities, or a present
arrangement (whether or not legally binding) or intention to effect
any distribution of any of the Securities to or through any person
or entity; provided, however, that by making the representations
herein, Purchaser does not agree to hold the Securities for any
minimum or other specific term and reserves the right to dispose of
the Securities at any time in accordance with federal and state
securities laws applicable to such disposition. Purchaser
acknowledges that it (i) has such knowledge and experience in
financial and business matters such that Purchaser is capable of
evaluating the merits and risks of Purchaser’s investment in
the Company; (ii) is able to bear the financial risks
associated with an investment in the Securities; and (iii) has
been given full access to such records of the Company and the
Subsidiaries and to the officers of the Company and the
Subsidiaries as it has deemed necessary or appropriate to conduct
its due diligence investigation.
d.
Rule 144 . Purchaser acknowledges that the Securities,
nor the shares of the Common Stock underlying the Warrants, have
not been registered under the Securities Act of 1933, as amended
(the “Act”), or any applicable state securities laws in
reliance upon exemption provisions of the Act and such other laws;
and accordingly, no Federal or state agency has made any
recommendation or endorsement as to, or otherwise passed on the
merits of, purchasing the shares. Purchaser further acknowledges
that there will be no public market for the shares and that it will
not be possible to readily liquidate his or her investment. Because
the Common Stock has not been registered under the Act or state
law, Purchaser must bear the economic risks of investment for an
indefinite period of time and Purchaser understands that the
Securities must be held indefinitely unless such Securities are
registered under the Securities Act or an exemption from
registration is available. Purchaser acknowledges that such person
is familiar with Rule 144 of the rules and regulations of the
Commission, as amended, promulgated pursuant to the Securities Act
(“Rule 144”), and that Purchaser has been advised
that Rule 144 permits resales only under certain
circumstances. Purchaser understands that, to the extent that
Rule 144 is not available, Purchaser will be unable to sell
any Securities without either registration under the Securities Act
or the existence of another exemption from such registration
requirement.
e.
Independent Inquiry . Purchaser has been given
(i) access to all books and records, legal documents and other
material information of the Company; (ii) access to all
material contracts and documents of the Company relating to the
sale of the shares and the
