EXTENSION AND MODIFICATION AGREEMENT
This Extension and Modification
Agreement (“Agreement”)
dated as of February 25, 2010 is entered into by and among Liberty Star Uranium
& Metals Corp., a Nevada corporation (the “Company”) and the subscribers
identified on the signature page hereto (each herein a “Subscriber” and collectively
“Subscribers” and
together with the Company, the “Parties”).
WHEREAS, the Company and the
Subscribers are parties to Subscription Agreements (“Subscription Agreement”) and
other Transaction Documents and Allonges dated at and about May 11, 2007, August
28, 2008, May 22, 2009, August 14, 2009, and November 25, 2009, as same may have
been amended, relating to the issuance to Subscribers as “Holders” of promissory notes
(each a “Note”) of the
Company convertible into shares of the Company’s 5.001 par value common stock
and Warrants exercisable for Common Stock; and
WHEREAS, the Maturity Dates of some
Notes has passed and Events of Default have occurred and are pending and it
would be beneficial to the Company that the Maturity Dates of the Notes be
extended; and
WHEREAS, the Company and Subscribers
desire to further restructure the terms of the Transaction Documents to their
mutual benefit.
NOW THEREFORE, in consideration of the
mutual covenants and other agreements contained in this Agreement, the Company
and the Subscribers hereby agree as follows:
1. Capitalized
terms employed herein shall have the meanings attributed to them in the
Transaction Documents.
2. The
Maturity Date of each Note is extended to be February 28, 2011, subject to
acceleration as described in the Notes. Upon three days prior notice to the
Company, each Holder of a Note may elect to extend the Maturity Date of its Note
for up to 180 days for each such extension. The Holder may grant two such 180
day extensions. Each Holder, for itself only, may, at such Holder’s sole
discretion, agree to accept full payment of its Notes prior to the Maturity
Dates upon a written agreement with the Company. Anything to the contrary in the
Note notwithstanding, in addition to notices required to be given by the Company
in connection with Monthly Amounts, the Company agrees to give the Holder of a
Note five business days (or such longer period set forth in the Note) prior
notice of its intention to pay the Note in part or in full on the Maturity Date
or otherwise, so that the Holder of a Note may exercise his rights, including
but not limited to the right to extend the Maturity Date.
3. The
Company agrees that in the event any payment or notice required to be made or
given by the Company in connection with any Monthly Amount payable in connection
with any Note is or was not timely made or given, then thereafter, the Holder of
each such Note and not the Company shall have the right to elect whether to
receive all or some of the outstanding Monthly Amounts and all or some of the
subsequent Monthly Amounts in cash or Common Stock calculated in the manner set
forth in Section 2.1 of each Note, respectively.
4. The
Company acknowledges that the holding period for purposes of Rule 144 under the
Securities Act of 1933 is unaffected by the agreements herein.
5. The
Company undertakes to make a public announcement on Form 8-K describing
the terms of this Agreement not later than the fourth business day
after the execution of this Agreement.
6.
For
the benefit of the parties hereto, the Company hereby makes all the
representations, warranties, covenants undertakings and indemnifications
contained in the Transaction Documents, as if such representations were made by
the Company as of this date.
7. Subject
to the modifications and amendments provided herein, the Transaction Documents
shall remain in full force and effect, including but not limited to the accrual
of interest and liquidated damages, if any. Except as expressly set forth
herein, this Agreement shall not be deemed to be a waiver, amendment or
modification of any provisions of the Transaction Documents or of any right,
power or remedy of the Subscribers, or constitute a waiver of any provision of
the Transaction Documents (except to the extent herein set forth), or any other
document, instrument and/or agreement executed or delivered in connection
therewith, in each case whether arising before or after the date hereof or as a
result of performance hereunder or thereunder. Except as set forth herein, the
Subscribers reserve all rights, remedies, powers, or privileges available under
the Transaction Documents, at law or otherwise. This Agreement shall not
constitute a novation or satisfaction and accord of the Transaction Documents or
any other document, instrument and/or agreement executed or delivered in
connection therewith.
8. The
obligations of each Subscriber hereunder are several and not joint with the
obligations of any other Subscribers hereunder, and no Subscriber shall be
responsible in any way for the performance of the obligations of any other
Subscriber hereunder. Nothing contained herein or in any other agreement or
document delivered at any closing, and no action taken by any Subscriber
pursuant hereto, shall be deemed to constitute the Subscribers as a partnership,
an association, a joint venture or any other kind of entity, or create a
presumption that the Subscribers are in any way acting in concert with respect
to such obligations or the transactions contemplated by this Agreement. Each
Subscriber shall be entitled to protect and enforce its rights, including
without limitation the rights arising out of this Agreement, and it shall not be
necessary for any other Subscriber to be joined as an additional party in any
proceeding for such purpose, except as otherwise agreed by the
Subscribers.
9. This
Agreement shall inure to the benefit of and be binding upon the successors and
permitted assigns of each of the parties; provided, however, that no party may
assign this Agreement or the obligations and rights of such party hereunder
without the prior written consent of the other parties hereto, except as same is
permitted under the Transaction Documents.
10. This
Agreement constitutes the entire agreement among the parties regarding the
subject matter herein, and supersedes all prior and contemporaneous agreements
and understandings of the parties in connection herewith. No changes,
modifications, terminations or waivers of any of the provisions hereof shall be
binding unless in writing and signed by all of the parties thereto.
11. All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be determined pursuant to the governing law provisions
of the Transaction Documents.
12. The
language used in this Agreement will be deemed to be the language chosen by the
parties to express their mutual intent, and no rules of strict construction will
be applied against any party.
13. Each
of the undersigned states that he has read the foregoing Agreement and
understands and agrees to it.
14. This
Agreement may be executed in two or more counterparts, all of which when taken
together shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to any
other party, it being understood that all parties need
2
not sign
the same counterpart. In the event that any signature is delivered by facsimile
transmission or electronically, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is
executed) with the same with the same force and effect as if such facsimile
signature were an original thereof.
[Signature
Page Follows]
3
IN WITNESS WHEREOF, the undersigned
have executed and delivered this Extension and Modification Agreement as of the
date first written above.
LIBERTY
STAR URANIUM & METALS CORP.
the
“Company”
By: /s/ Xxxxx
Xxxxxxx
“SUBSCRIBERS”
/s/
signed
ALPHA
CAPITAL ANSTALT
4
