EXHIBIT 10.1
OMNIBUS AMENDMENT AND WAIVER
This OMNIBUS AMENDMENT AND WAIVER (this "AMENDMENT"), dated as of
November 27, 2006, is entered into by and between ISLAND PACIFIC, INC., a
Delaware corporation (the "COMPANY"), and LAURUS MASTER FUND, LTD., a Cayman
Islands company ("LAURUS"), for the purpose of amending and amending and
restating and waiving certain terms of (i) the Amended and Restated Secured Term
Note, dated as of November 17, 2005 (as amended and restated, amended, modified
and/or supplemented from time to time, the "NOVEMBER 2005 BRIDGE NOTE") issued
by the Company to Laurus, (ii) the Registration Rights Agreement by and between
the Company and Laurus dated November 17, 2005 (as amended, modified or
supplemented from time to time, the "NOVEMBER 2005 REG. RIGHTS AGREEMENT"),
(iii) the Securities Purchase Agreement, dated as of November 17, 2005 (as
amended, modified or supplemented from time to time, the "NOVEMBER 2005 PURCHASE
AGREEMENT") by and between the Company and Laurus, (iv) the Amended and Restated
Secured Convertible Term Note, dated as of July 12, 2004 (as amended and
restated, amended, modified and/or supplemented from time to time, THE "JULY
2004 TERM NOTE") issued by the Company to Laurus, (v) the Securities Purchase
Agreement, dated as of July 12, 2004 (as amended, modified or supplemented from
time to time, the "JULY 2004 PURCHASE AGREEMENT") by and between the Company and
Laurus, (vi) the Registration Rights Agreement by and between the Company and
Laurus dated July 12, 2004 (as amended, modified or supplemented from time to
time, the "JULY 2004 REG. RIGHTS AGREEMENT"), (vii) the Secured Convertible Term
Note, dated as of June 15, 2005 (as amended, modified and/or supplemented from
time to time, the "JUNE 2005 TERM NOTE" and together with the July 2004 Term
Note, the "TERM NOTES" and each, a "TERM NOTE") issued by the Company to Laurus,
(viii) the Securities Purchase Agreement, dated as of June 15, 2005 (as amended,
modified or supplemented from time to time, the "JUNE 2005 PURCHASE AGREEMENT"
and together with the November 2005 Purchase Agreement and the July 2004
Purchase Agreement, the "PURCHASE AGREEMENTS" and each, a "PURCHASE AGREEMENT")
by and between the Company and Laurus and (ix) the Registration Rights Agreement
by and between the Company and Laurus dated June 15, 2005 (as amended, modified
and/or supplemented from time to time, the "JUNE 2005 REG. RIGHTS AGREEMENT" and
together with the November 2005 Reg. Rights Agreement and the July 2004 Reg.
Rights Agreement, the "REG. RIGHTS AGREEMENTS" and each, a "REG. RIGHTS
AGREEMENT"). Capitalized terms used herein without definition shall have the
meanings ascribed to such terms in the applicable November 2005 Bridge Note,
Term Note, Purchase Agreement or Reg. Rights Agreement.
WHEREAS, the Company and Laurus have agreed to make certain changes to
the November 2005 Bridge Note, the Term Notes, the Purchase Agreements and the
Reg. Rights Agreements as set forth herein.
NOW, THEREFORE, in consideration of the above, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
WAIVERS
A.Laurus and the Company hereby agree that the Company shall not be
required to pay the principal portion of any Monthly Amount (as defined in the
July 2004 Term Note) due on the first business day of each of the following
months: September 2006, October 2006, November 2006, December 2006, January 2007
and February 2007 on such dates (collectively the "July 2004 Postponed
Principal"); provided that, the July 2004 Postponed Principal shall be paid in
full on the Maturity Date (as defined in the July 2004 Term Note), together with
all other amounts due and payable on such date under the July 2004 Purchase
Agreement and the Related Agreements referred to in the July 2004 Purchase
Agreement. Monthly Amount payments shall resume pursuant to the terms of the
July 2004 Term Note on March 1, 2007.
B.Laurus and the Company hereby agree that the Company shall not be
required to pay the principal portion of any Monthly Amount (as defined in the
June 2005 Term Note) due on the first business day of each of the following
months: September 2006, October 2006, November 2006, December 2006, January 2007
and February 2007 on such dates (collectively, the "June 2005 Postponed
Principal"); provided that, the June 2005 Postponed Principal shall each be paid
in full on the Maturity Date (as defined in the June 2005 Term Note), together
with all other amounts due and payable on such date under the June 2005 Purchase
Agreement and the Related Agreements referred to in the June 2005 Purchase
Agreement. Monthly Amount payments shall resume pursuant to the terms of the
June 2005 Term Note on March 1, 2007.
AMENDMENTS
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1. The November 2005 Bridge Note is hereby amended and restated in the
form attached hereto as Exhibit A (the "SECOND AMENDED AND RESTATED SECURED TERM
NOTE"). For the avoidance of doubt, the amendment and restatement of the
November 2005 Bridge Note as set forth in this Section 1 shall be in
substitution for and not in satisfaction of the November 2005 Bridge Note. Upon
the execution of this Amendment and Waiver and prior to Company delivering an
originally executed copy of the Second Amended and Restated Secured Term Note to
Laurus, Laurus will return the originally executed Secured Term Note dated
November 17, 2005 and the Amended and Restated Secured Term Note dated March 21,
2006 to the Company. The parties acknowledge and agree that (a) the $750,000
provided by Laurus to the Company on August 31, 2006 shall be treated as an
advance pursuant to, and applied against any funds deliverable to the Company in
connection with, the Second Amended and Restated Bridge Note, and (b) any funds
distributed to Laurus from Loeb & Loeb LLP at the direction of the Company on or
around August 31, 2006 shall be treated as an advance pursuant to, and applied
against, any funds deliverable to Laurus as a Closing Payment as described in
Section 8 below.
2. The definition of Maturity Date appearing in the November 2005
Bridge Note is hereby amended to extend such Maturity Date to "February 28,
2007".
3. For avoidance of doubt, the definition of Maturity Date appearing on
the July 2004 Term Note is July 12, 2007 and the definition of Maturity Date
appearing on the June 2005 Term Note is June 15, 2008.
4. Laurus understands that the Company has an affirmative obligation to
make prompt public disclosure of material agreements and material amendments to
such agreements. The Company hereby covenants to report the terms and provisions
of this Amendment on a current report on Form 8-K within five (5) business days
of the date hereof.
5. In each place where the term "Option" is used in the Purchase
Agreements and/or the Registration Rights Agreements, such term shall be deemed
to include the Additional Option (as defined herein) issued in connection with
this Amendment.
6. The first sentence of Section 6.2 of the Purchase Agreements shall
be amended to state:
"By January 1, 2007, the Company shall secure the listing of the
shares of Common Stock issuable upon the exercise of the Warrant and
upon exercise of the Option on the NASD OTC Bulletin Board (the
"Principal Market") upon which shares of Common Stock are listed and
shall maintain such listing so long as any other shares of Common
Stock shall be so listed."
MISCELLANEOUS
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7. The Company agrees that it shall issue on the date hereof an Option
(the "Additional Option") to Laurus to purchase up to 1,706,250 shares of the
Common Stock of the Company with an exercise price of $0.01 per share, such
Additional Option to be in the form attached hereto as Exhibit B.
8. The Company agrees that, in connection with this Amendment, the
Company shall pay to Laurus Capital Management, LLC a payment in an amount equal
to twenty-four thousand dollars ($24,000). The foregoing fee is referred to
herein as the "Closing Payment".
9. Each amendment and waiver set forth herein shall be effective as of
the date first above written (the "AMENDMENT EFFECTIVE DATE") on the date when
(i) each of the Company and Laurus shall have executed and the Company shall
have delivered to Laurus its respective counterpart to this Amendment, and (ii)
the Company shall have executed and delivered to Laurus each of the Additional
Option and the Second Amended and Restated Secured Term Note.
10. All representations and warranties made in the Purchase Agreements
(as qualified by any disclosure schedules or similar documents previously
delivered to Laurus by the Company) with respect to any Warrant, Option, Warrant
Shares or Option Shares shall be deemed to have been made as of the date hereof
with respect to the Additional Option and the shares of the Company's Common
Stock issuable to Laurus upon exercise thereof.
11. Except as specifically set forth in this Amendment, there are no
other amendments, modifications or waivers to the Term Notes, Purchase
Agreements or Reg. Rights Agreements, and all of the other forms, terms and
provisions of the Term Notes and the Purchase Agreements remain in full force
and effect.
12. The Company hereby represents and warrants to Laurus that after
giving effect to this Amendment: (i) on the date hereof, all representations,
warranties and covenants made by the Company in connection with the Second
Amended and Restated Secured Term Note, the Term Notes and the Purchase
Agreements (as qualified by any disclosure schedules or similar documents
delivered to Laurus by the Company) are true, correct and complete except as
qualified or limited in any manner by the information set forth in the
disclosure schedule delivered by the Company to Laurus pursuant to Section 4 of
the November 2005 Purchase Agreement or in the SEC Reports and except that the
Company did not file its reports on Form 10-K for the years ended March 31, 2005
and March 31, 2006 and Form 10-Q for the quarters ended June 30, 2006, June 30,
2005, September 30, 2005 and December 31, 2005; and (ii) on the date hereof, all
of the Company's and its Subsidiaries' covenant requirements set forth in the
Second Amended and Restated Secured Term Note, the Term Notes, the Purchase
Agreements, the Reg. Rights Agreements and Related Agreements (as defined in the
respective Purchase Agreements) have been met.
13. From and after the Amendment Effective Date, all references to the
November 2005 Bridge Note, the Term Notes and the Purchase Agreements shall be
deemed to be references to the Second Amended and Restated Secured Term Note,
the Term Notes and Purchase Agreements as modified hereby.
14. This Amendment shall be binding upon the parties hereto and their
respective successors and permitted assigns and shall inure to the benefit of
and be enforceable by each of the parties hereto and their respective successors
and permitted assigns. THIS AMENDMENT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK. This Amendment
may be executed in any number of counterparts, each of which shall be an
original, but all of which shall constitute one instrument.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, each of the Company and Laurus has caused this
Amendment to be signed in its name effective as of this _____ day of November
2006.
ISLAND PACIFIC, INC.
By:
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Name: Xxxxx Xxxxxxxxx
Title: Chief Executive Officer
LAURUS MASTER FUND, LTD.
By:
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Name:
Title:
EXHIBIT A
SECOND AMENDED AND RESTATED BRIDGE NOTE
EXHIBIT B
ADDITIONAL OPTION
