SUPPLEMENTARY AGREEMENT
EXHIBIT 10.1
This supplementary agreement is made on the 11th day of August, 2004 by and between
1. Xxxxx Xxxx AG, Xxxxxxxxxxxxxxxx 00, D-24941, Flensburg, duly represented by its CFO Xxxx Xxxxxxxxx Xxxxxxxxx and its procurator Mrs Gesa Münzmaier, hereinafter referred to as “Xxxxx Xxxx” and or “Lender”
and
2a. Private Media Group Inc., established at USA, 0000 Xxxxxxxx Xxxx, Xxxxx 000, Xxx Xxxxx, Xxxxxx 00000, duly represented by Johan Gillborg, and its subsidiary companies:
2b. Private Benelux BV, established at the Netherlands, 5084 PS Best, De Dintel 18-20, duly represented by its director Johan Gillborg
2c. Peach Entertainment Distribution AB, established at Sweden, Starrbacksgatan 3, 17223 Sundbyberg, duly represented by Bo Rodebrant
hereinafter referred to as “Private” and or “Borrower”
Whereas:
Private and Xxxxx Xxxx concluded an agreement on 11 December 2002 pursuant to which Xxxxx Xxxx, as the Lender, has granted Private, as the Borrower, a loan amounting to US $ 3 million, which was repayable at the latest by 13 December 2003 (“the Original Agreement” or “the Agreement”).
The parties hereby confirm and agree that the Agreement is amended in accordance with the terms stipulated in this agreement.
Have agreed as follows:
Article 1
1.1 The Lender hereby agrees to continue the loan of 3 million $ to the Borrower. The loan is repayable ultimately on 31-12-2005. As of 30-06-2004, the Loan Amount has been reduced to US $ 2.246.046,35, including accrued interest, after giving effect to the setoff of receivables due from Xxxxx Xxxx or certain of its subsidiaries to Private or certain of its subsidiaries, as described in Schedule One to this Agreement.
1.2 The Borrower shall be entitled to prepay the Loan in whole at any time, or in part from time to time, without premium or penalty provided the Borrower announces these payments a month in advance and the amount of the repayments shall be in amounts of 100.000 US $ (hundred thousand US Dollar) at a minimum.
Article 2 Interest rate
The Borrower shall owe interest on the amount of the Loan outstanding at the rate of 5% per annum during the term of this agreement. Interests shall be due and payable each quarter.
Article 3 Repayment
The repayment obligation is regulated as follows:
1. The loan debt under this Agreement will be repaid by setting off receivables due from certain subsidiaries of Xxxxx Xxxx that will arise on or after 30-06-2004 from deliveries and services by certain subsidiaries of Private, namely
a) receivables due from Scala Agenturen BV in Amsterdam, the Netherlands.
payable to
Private Benelux BV in Best, Netherlands (Private Benelux)
and
b) receivables due from Xxxxx Xxxx MAX´S AB in Stockholm, Sweden (Max A.B)
payable to
Peach Entertainment Distribution AB in Sundbyberg, Sweden (Peach Entertainment)
2. Thus the repayment normally will be finalized somewhere in 2005. Any outstanding amount under this agreement, which has not been repaid by setting off receivables per 01-12-2005, has to be repaid by Private ultimately 31-12-2005.
Xxxxx Xxxx will provide an overview of the outstanding amount per 01-12-2005 to Private.
Article 4
4.1 The following subsidiaries of Private assign to Xxxxx Xxxx their receivables from subsidiaries of the Xxxxx Xxxx Group up to the total amount of the outstanding loan amount from time to time plus accrued and unpaid interest at the stipulated rate of 5% per annum.
• | Private Benelux BV, established in Best, the Netherlands; |
• | Peach Entertainment AB, established in Sundbyberg, Sweden; |
Article 5
Xxxxx Xxxx and or its subsidiaries have no obligation by reason of this Agreement to purchase goods / products from Private and its subsidiaries.
Peach and Private Benelux each intend to continue their respective business relationship with Scala and Max AB, and visa versa. However, none of such entities shall have any obligation whatsoever by reason of this Agreement to continue their business relationship with the others.
Article 6 Events of Default
1. Xxxxx Xxxx confirms that upon execution of this Supplementary Agreement by all parties Private is not in default in connection with its obligations under the Agreement. Private agrees that thereafter, if one or more of the following events occurs and continues for not less than 10 days after written notice from Xxxxx Xxxx to Private (“Events of Default”):
a. Prior to the repayment of the outstanding loan amount Private Benelux does not deliver services or goods available in stock to Scala, or Peach does not deliver services or goods available in stock to Max AB, in either case on a timely basis during the term of the Agreement;
b. Private fails to make any payment under this Agreement when due;
c. Private, directly or indirectly, sells or transfers all or substantially all of its assets;
d. Private, Peach or Private Benelux is adjudicated as bankrupt under applicable law; or
e. a receiver, trustee or similar official is appointed to administer all or a substantial portion of Private´s assets (including assets owned indirectly through a subsidiary) and such action is not stayed or dismissed within 30 days;
then, in such event the full loan amount shall immediately become due and payable, including interest and allowable costs, and Xxxxx Xxxx shall be free to take any and all lawful action required to enforce its rights under the Agreement.
2. If Xxxxx Xxxx decides not to buy any Private products anymore, then Xxxxx Xxxx will give written notification thereof to Private. The outstanding amount including interest then have to be repaid by Private in monthly equal terms, thus that the outstanding amount will be fully repaid per 31-12-2005.
Article 7 Default interest
Any amounts which are payable to Xxxxx Xxxx under this Agreement and which are not paid when due, shall carry interest in accordance with Section 000 XXX (Xxxxxx Civil Code)
Article 8 Miscellaneous
If any provision of this Agreement is or becomes invalid the validity of the remaining provisions of this Agreement shall not be affected. The contracting parties are obliged to replace any invalid provisions by valid provisions which fulfil the desired purpose.
This Agreement is governed by the law of the Federal Republic of Germany.
The courts of Hamburg shall have non-exclusive jurisdiction for any controversy out of or in connection with this Agreement.
Flensburg, September 2, 2004 | Barcelona, August 11, 2004 | |
Xxxxx Xxxx AG | Private Media Group Inc. | |
/s/ X.X. Xxxxxxxxx |
/s/ Johan Gillborg | |
O.C. Xxxxxxxxx | Xxxxx Gillborg | |
Barcelona, August 11, 2004 | ||
Private Benelux BV | ||
/s/ Johan Gillborg | ||
Johan Gillborg | ||
Sundbyberg, August 25, 2004 | ||
Peach Entertainment AB | ||
/s/ Bo Rodebrant | ||
Bo Rodebrant |