AMENDMENT TO TRANSACTION DOCUMENTS AGREEMENT
Agreement made this 27th day of June, 2005 ("Amendment") among GTC Telecom
Corp., a Nevada corporation (the "Company"), and the signators hereto who are
Subscribers under a certain Subscription Agreement with the Company dated May
23, 2005 ("Subscribers").
For good and valuable mutual consideration, receipt of which is hereby
acknowledged, the parties hereto agree as follows:
1. All capitalized terms herein shall have the meanings ascribed to
them in the Transaction Documents (as defined in the Subscription Agreement).
2. The Company and the Subscribers hereby agree to amend the
Transaction Documents to reflect the additional Purchase Price ("Additional
Purchase Price") as set forth on Schedule A hereto. Purchase Price shall mean
the aggregate of the Purchase Price in connection with the May 23, 2005 Closing
Date and the Additional Purchase Price.
3. An additional Closing (the "Second Closing") shall take place on or
before July 5, 2005 (the "Second Closing Date") in connection with the
Additional Purchase Price, Additional Shares, Notes and Warrants, upon
satisfaction of all conditions to Closing set forth in the Transaction Documents
and in this Amendment. The net amount of the Additional Purchase Price after
deduction of the original issue discount and all documents to be delivered
hereunder will be deposited and held with the Escrow Agent and released pursuant
to the Escrow Agreement. The Initial Shares, Notes and Warrants to be delivered
on the Second Closing Date are included in the definition of "Securities" in the
Subscription Agreement.
4. All the representations and warranties made by the Company contained
in the Transaction Documents as of the Closing Date are hereby made by the
Company as of the Second Closing Date, as if said representations and warranties
were also made and given on such Second Closing Date.
5. All the representations and warranties made by the Subscribers
contained in the Transaction Documents as of the Closing Date are hereby made by
the Subscribers as of the Second Closing Date, as if said representations and
warranties were also made and given on such Second Closing Date.
6. All of the covenants and conditions set forth in Sections 5, 7, 8,
9, 10, 11 and 12 of the Subscription Agreement in relation to the Closing Date,
Notes, Initial Shares, and Warrant are hereby adopted and renewed by the Company
as of the Second Closing Date.
7. On or before the Second Closing Date, the Company will deliver to
the Subscribers Notes, Additional Shares, and Warrants issued as of the Second
Closing Date in the amounts set forth on Schedule A hereto in connection with
the Additional Purchase Price which the Subscribers will deposit with the Escrow
Agent on or before the Second Closing Date.
8. The Filing Date and Effective Date for all Registrable Securities,
including all Registrable Securities relating to the Additional Purchase Price,
Initial Shares, Notes and Warrants to be issued on the Second Closing Date shall
be fifteen (15) days and one hundred and twenty (120) days, respectively, as
calculated from the Second Closing Date.
9. The Maturity Date of the Notes to be issued on the Second Closing
Date will be the same as the Maturity Date of the Notes issued on the Closing
Date.
10. The Warrants to be issued on the Second Closing Date will be
identical to the Warrants issued on the Closing Date except as to the Issue Date
and Expiration Date.
11. On or before the Second Closing Date, the Company will deliver to
the Subscribers the legal opinion described in Section 6 of the Subscription
Agreement in relation to the Second Closing, Additional Purchase Price, Notes,
Additional Shares and Warrants to be delivered on the Second Closing Date, which
opinion will be substantively identical to the legal opinion delivered in
connection with the Closing.
11. On or before the Second Closing Date, the Subsidiaries will deliver
to the Subscribers an executed Guaranty Agreement in the form annexed hereto as
Exhibit 1.
12. In connection with the Additional Purchase Price, the Broker will
receive cash Broker's Fees and Broker's Warrants in the same proportion as
received in connection with the May 23, 2005 Closing.
13. The attorney for the Subscribers will receive additional Legal Fees
of $6,250 which will be payable on the Second Closing Date out of the Escrowed
Payment (as defined in the Escrow Agreement).
14. The signators hereto acknowledge and agree that the Security
Agreement and Collateral Agent Agreement executed by the Company, Subsidiaries,
Subscribers and Collateral Agent relate to the Additional Purchase Price as if
such Additional Purchase Price had been paid and released to the Company on the
May 23, 2005 Closing Date. The Collateral Agent is authorized to make
additional security interest filings at the discretion of the Collateral Agent.
15. The parties hereto agree to expeditiously proceed with the Second
Closing.
16. All other terms of the Transaction Documents shall remain in full
force and effect and govern this Agreement.
[THIS SPACE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the undersigned have executed and delivered this Amendment
as of the date first written above.
"COMPANY" "THE COLLATERAL AGENT"
GTC TELECOM CORP. XXXXXXX X. XXXXXXX
a Nevada corporation
By: /s/ Xxxx Clemons___ __/s/ Xxxxxxx Mittman___________
Its: _President_________
"SUBSIDIARY" "SUBSIDIARY"
CURBSIDE COMMUNICATIONS, INC. PERFEXA SOLUTIONS, INC.
A Nevada corporation A Nevada corporation
By: _/s/ Xxxxxx DeCiccio_________ By:__/s/ Xxxx Clemons___________
Its:_President__________________ Its:_President__________________
"SUBSCRIBERS":
__[signature illegible]________ _/s/ Xxxxxxx X. Haas_________
ALPHA CAPITAL AKTIENGESELLSCHAFT DCOFI MASTER LDC
__/s/ Xxxxxx Geduld_____________ __/s/ Xxxxxx Todd______________
SCG CAPITAL, LLC SILVER OAK INVESTMENTS, INC.
__/s/ Xxxxxxx Unger____________ ___/s/ Grushko & Xxxxxxx PC_____
XXXXX INTERNATIONAL LTD. GRUSHKO & XXXXXXX, P.C.
Escrow Agent
SCHEDULE A TO AMENDMENT
SUBSCRIBER ADDITIONAL NOTE ADDITIONAL CLASS A CLASS B
PURCHASE PRINCIPAL SHARES WARRANTS WARRANTS
PRICE
(PAYMENT AFTER
ORIGINAL ISSUE
DISCOUNT)
-----------------------------------------------------------------------------------------------
ALPHA CAPITAL $ 200,000.00 $235,296.00 470,592 1,411,776 1,176,480
AKTIENGESELLSCHAFT
Xxxxxxxxx 0
0000 Xxxxxxxxxxx
Vaduz, Lichtenstein
Fax: 000-00-00000000
DCOFI MASTER LDC $ 300,000.00 $352,941.00 705,882 2,117,646 1,764,705
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Fax: (000) 000-0000
SCG CAPITAL, LLC $ 125,000.00 $147,059.00 294,118 882,354 735,295
00000 Xxxxxxxx Xxxxxxxxx,
Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxx, President
Fax: (000) 000-0000
SILVER OAK INVESTMENTS, INC. $ 100,000.00 $117,648.00 235,296 705,888 588,240
000 Xxxxxxxxxx Xxxxxx, Xxxxx
0000
Xxx Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
XXXXX INTERNATIONAL LTD. $ 50,000.00 $ 58,824.00 117,648 352,944 294,120
53rd Street Xxxxxxxxxxxx
Xxxxxxx
Xxxxx Xxxxx, 00xx Xxxxx,
Xxxxxx
Xxxxxxxx of Panama
Fax: (000) 000-0000
TOTAL $ 775,000 $911,768.00 1,823,536 5,470,608 4,558,840
EXHIBIT 1
GUARANTY AGREEMENT
1. Identification.
This Guaranty Agreement (the "Guaranty"), dated as of [SECOND CLOSING
DATE], is entered into by and between Curbside Communications, Inc., a Nevada
corporation, Perfexa Solutions, Inc., a Nevada corporation (each referred to as
"Guarantor" herein) and Xxxxxxx Xxxxxxx, as collateral agent acting in the
manner and to the extent described in the Collateral Agent Agreement defined
below (the "Collateral Agent"), for the benefit of the parties identified on
Schedule A hereto (each a "Lender" and collectively, the "Lenders").
2. Recitals.
2.1 Curbside Communications, Inc. is a direct or indirect wholly-owned
subsidiary of GTC Telecom Corp., a Nevada corporation ("GTC Telecom"). Perfexa
Solutions, Inc. is a 97% owned subsidiary of GTC Telecom. The Lenders have made
and are making loans to GTC Telecom (the "Loans"). Guarantor will obtain
substantial benefit from the proceeds of the Loans.
2.2 The Loans are and will be evidenced by certain convertible
promissory notes (each a "Convertible Note" and collectively, the "Convertible
Notes") issued by GTC Telecom on or about the date of this Agreement pursuant to
subscription agreements and an Amendment to Transaction Documents Agreement
(collectively herein "Subscription Agreements"). The Convertible Notes are
further identified on Schedule A hereto and were and will be executed by GTC
Telecom as "Borrower" or "Debtor" for the benefit of each Lender as the "Holder"
or "Lender" thereof.
2.3 In consideration of the Loans made by Lenders to GTC Telecom and
for other good and valuable consideration, and as security for the performance
by GTC Telecom of its obligations under the Convertible Notes and as security
for the repayment of the Loans and all other sums due from Debtor to Lenders
arising under the Convertible Notes, Subscription Agreements, Collateral Agent
Agreement and any other agreement between or among them relating to the
foregoing (collectively, the "Obligations"), Guarantor, for good and valuable
consideration, receipt of which is acknowledged, has agreed to enter into this
Agreement with the Collateral Agent, for the benefit of the Lenders.
Obligations include all future advances by Lenders to GTC Telecom made by all
Lenders on substantially the same terms and in proportion to their interests in
the Obligations.
2.4 The Lenders have appointed Xxxxxxx Xxxxxxx as Collateral Agent
pursuant to that certain Collateral Agent Agreement dated at or about [SECOND
CLOSING DATE] ("Collateral Agent Agreement"), among the Lenders and Collateral
Agent.
3. Guaranty.
3.1 Guaranty. Guarantors hereby unconditionally and irrevocably
guarantee jointly and severally the punctual payment, performance and observance
when due, whether at stated maturity, by acceleration or otherwise, of all of
the Obligations now or hereafter existing, whether for principal, interest
(including, without limitation, all interest that accrues after the commencement
of any insolvency, bankruptcy or reorganization of GTC Telecom, whether or not
constituting an allowed claim in such proceeding), fees, commissions, expense
reimbursements, liquidated damages, indemnifications or otherwise (such
obligations, to the extent not paid by GTC Telecom being the "Guaranteed
Obligations"), and agrees to pay any and all costs, fees and expenses (including
reasonable counsel fees and expenses) incurred by Collateral Agent and the
Lenders in enforcing any rights under the guaranty set forth herein. Without
limiting the generality of the foregoing, Guarantor's liability shall extend to
all amounts that constitute part of the Guaranteed Obligations and would be owed
by GTC Telecom to Collateral Agent and the Lenders, but for the fact that they
are unenforceable or not allowable due to the existence of an insolvency,
bankruptcy or reorganization involving GTC Telecom.
3.2 Guaranty Absolute. Guarantor guarantees that the Guaranteed
Obligations will be paid strictly in accordance with the terms of the
Convertible Notes, regardless of any law, regulation or order now or hereafter
in effect in any jurisdiction affecting any of such terms or the rights of
Collateral Agent or the Lenders with respect thereto. The obligations of
Guarantor under this Agreement are independent of the Guaranteed Obligations,
and a separate action or actions may be brought and prosecuted against Guarantor
to enforce such obligations, irrespective of whether any action is brought
against GTC Telecom or any other Guarantor or whether GTC Telecom or any other
Guarantor is joined in any such action or actions. The liability of Guarantor
under this Agreement constitutes a primary obligation, and not a contract of
surety, and shall be irrevocable, absolute and unconditional irrespective of,
and Guarantor hereby irrevocably waives any defenses it may now or hereafter
have in any way relating to, any or all of the following:
(a) any lack of validity or enforceability of the Convertible Notes or
any agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Guaranteed Obligations, or any other amendment
or waiver of or any consent to departure from the Convertible Notes, including,
without limitation, any increase in the Guaranteed Obligations resulting from
the extension of additional credit to GTC Telecom or otherwise;
(c) any taking, exchange, release, subordination or non-perfection of
any Collateral, or any taking, release or amendment or waiver of or consent to
departure from any other guaranty, for all or any of the Guaranteed Obligations;
(d) any change, restructuring or termination of the corporate, limited
liability company or partnership structure or existence of GTC Telecom; or
(e) any other circumstance (including, without limitation, any
statute of limitations) or any existence of or reliance on any representation by
Collateral Agent or the Lenders that might otherwise constitute a defense
available to, or a discharge of, GTC Telecom or any other guarantor or surety.
This Agreement shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Guaranteed Obligations is rescinded
or must otherwise be returned by Collateral Agent, the Lenders or any other
entity upon the insolvency, bankruptcy or reorganization of the GTC Telecom or
otherwise (and whether as a result of any demand, settlement, litigation or
otherwise), all as though such payment had not been made.
3.3 Waiver. Guarantor hereby waives promptness, diligence, notice of
acceptance and any other notice with respect to any of the Guaranteed
Obligations and this Agreement and any requirement that Collateral Agent or the
Lenders or exhaust any right or take any action against any Borrower or any
other person or entity or any Collateral. Guarantor acknowledges that it will
receive direct and indirect benefits from the financing arrangements
contemplated herein and that the waiver set forth in this Section 3.3 is
knowingly made in contemplation of such benefits. Guarantor hereby waives any
right to revoke this Agreement, and acknowledges that this Agreement is
continuing in nature and applies to all Guaranteed Obligations, whether existing
now or in the future.
3.4 Continuing Guaranty; Assignments. This Agreement is a continuing
guaranty and shall (a) remain in full force and effect until the later of the
indefeasible cash payment in full of the Guaranteed Obligations and all other
amounts payable under this Agreement, the Subscription Agreements and
Convertible Notes, (b) be binding upon Guarantor, its successors and assigns and
(c) inure to the benefit of and be enforceable by Collateral Agent and the
Lenders and their successors, pledgees, transferees and assigns. Without
limiting the generality of the foregoing clause (c), the Collateral Agent and
any Lender may pledge, assign or otherwise transfer all or any portion of its
rights and obligations under this Agreement (including, without limitation, all
or any portion of its Convertible Notes owing to it) to any other Person, and
such other Person shall thereupon become vested with all the benefits in respect
thereof granted such Collateral Agent or Lender herein or otherwise.
3.5 Subrogation. No Guarantor will exercise any rights that it
may now or hereafter acquire against the Collateral Agent or any Lender or other
Guarantor (if any) that arise from the existence, payment, performance or
enforcement of such Guarantor's obligations under this Agreement, including,
without limitation, any right of subrogation, reimbursement, exoneration,
contribution or indemnification, whether or not such claim, remedy or right
arises in equity or under contract, statute or common law, including, without
limitation, the right to take or receive from the Collateral Agent or any Lender
or other Guarantor (if any), directly or indirectly, in cash or other property
or by set-off or in any other manner, payment or security solely on account of
such claim, remedy or right, unless and until all of the Guaranteed Obligations
and all other amounts payable under this Agreement shall have been indefeasibly
paid in full in cash. If (i) any Guarantor shall make payment to Collateral
Agent, or the Lenders of all or any part of the Guaranteed Obligations, and (ii)
of all or any of the Guaranteed Obligations and all other amounts payable under
this Agreement such payments shall be paid in full in cash.
3.6 Maximum Obligations. Notwithstanding any provision herein contained
to the contrary, Guarantor's liability with respect to the Obligations shall be
limited to an amount not to exceed, as of any date of determination, the amount
that could be claimed by Lenders from Guarantor without rendering such claim
voidable or avoidable under Section 548 of the Bankruptcy Code or under any
applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance
Act or similar statute or common law.
4. Miscellaneous.
4.1 Expenses. Guarantor shall pay to the Collateral Agent, on demand, the
amount of any and all reasonable expenses, including, without limitation,
attorneys' fees, legal expenses and brokers' fees, which the Collateral Agent
may incur in connection with (a) exercise or enforcement of any the rights,
remedies or powers of the Collateral Agent hereunder or with respect to any or
all of the Obligations; or (b) failure by Guarantor to perform and observe any
agreements of Guarantor contained herein which are performed by the Collateral
Agent.
4.2 Waivers, Amendment and Remedies. No course of dealing by the
Collateral Agent and no failure by the Collateral Agent to exercise, or delay by
the Collateral Agent in exercising, any right, remedy or power hereunder shall
operate as a waiver thereof, and no single or partial exercise thereof shall
preclude any other or further exercise thereof or the exercise of any other
right, remedy or power of the Collateral Agent. No amendment, modification or
waiver of any provision of this Agreement and no consent to any departure by
Guarantor therefrom, shall, in any event, be effective unless contained in a
writing signed by the Collateral Agent, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given. The rights, remedies and powers of the Collateral Agent, not only
hereunder, but also under any instruments and agreements evidencing or securing
the Obligations and under applicable law are cumulative, and may be exercised by
the Collateral Agent from time to time in such order as the Collateral Agent may
elect.
4.3 Notices. All notices or other communications given or made
hereunder shall be in writing and shall be personally delivered or deemed
delivered the first business day after being faxed (provided that a copy is
delivered by first class mail) to the party to receive the same at its address
set forth below or to such other address as either party shall hereafter give to
the other by notice duly made under this Section:
To GTC Telecom and
Guarantor, to: GTC Telecom Corp.
0000 Xxxxxx Xxxxxx, Xxxxx X-0
Xxxxx Xxxx, XX 00000
Attn: Vi Xxx, Esq.
Fax: (000) 000-0000
To Lenders: To the addresses and telecopier numbers set
forth on Schedule A
To the Collateral Agent: Xxxxxxx X. Xxxxxxx
Grushko & Xxxxxxx, P.C.
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Any party may change its address by written notice in accordance with this
paragraph.
4.4 Term; Binding Effect. This Agreement shall (a) remain in full
force and effect until payment and satisfaction in full of all of the
Obligations; (b) be binding upon Guarantor and its successors and permitted
assigns; and (c) inure to the benefit of the Collateral Agent, for the benefit
of the Lenders and their respective successors and assigns. All the rights and
benefits granted by Guarantor to the Collateral Agent and Lenders hereunder and
other agreements and documents delivered in connection therewith are deemed
granted to both the Collateral Agent and Lenders. Upon the payment in full of
the Obligations, (i) this Agreement shall terminate and (ii) Collateral Agent
will, upon Guarantor's request and at Guarantor's expense, execute and deliver
to Guarantor such documents as Guarantor shall reasonably request to evidence
such termination, all without any representation, warranty or recourse
whatsoever.
4.5 Captions. The captions of Paragraphs, Articles and Sections in
this Agreement have been included for convenience of reference only, and shall
not define or limit the provisions hereof and have no legal or other
significance whatsoever.
4.6 Governing Law; Venue; Severability. This Agreement shall be
governed by and construed in accordance with the laws of the State of New York
without regard to principles of conflicts or choice of law, except to the extent
that the perfection of the security interest granted hereby in respect of any
item of Collateral may be governed by the law of another jurisdiction. Any
legal action or proceeding against Guarantor with respect to this Agreement may
be brought in the courts of the State of New York or of the United States for
the Southern District of New York, and, by execution and delivery of this
Agreement, Guarantor hereby irrevocably accepts for itself and in respect of its
property, generally and unconditionally, the jurisdiction of the aforesaid
courts. Guarantor hereby irrevocably waives any objection which they may now or
hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement brought in the
aforesaid courts and hereby further irrevocably waives and agrees not to plead
or claim in any such court that any such action or proceeding brought in any
such court has been brought in an inconvenient forum. If any provision of this
Agreement, or the application thereof to any person or circumstance, is held
invalid, such invalidity shall not affect any other provisions which can be
given effect without the invalid provision or application, and to this end the
provisions hereof shall be severable and the remaining, valid provisions shall
remain of full force and effect.
4.7 Satisfaction of Obligations. For all purposes of this Agreement, the
payment in full of the Obligations shall be conclusively deemed to have occurred
when either the Obligations have been indefeasibly paid in cash or all
outstanding Convertible Notes have been converted to common stock pursuant to
the terms of the Convertible Notes and the Subscription Agreements.
4.8 Counterparts/Execution. This Agreement may be executed in any
number of counterparts and by the different signatories hereto on separate
counterparts, each of which, when so executed, shall be deemed an original, but
all such counterparts shall constitute but one and the same instrument. This
Agreement may be executed by facsimile signature and delivered by facsimile
transmission.
IN WITNESS WHEREOF, the undersigned have executed and delivered this Guaranty
Agreement, as of the date first written above.
"GUARANTOR" "GUARANTOR"
CURBSIDE COMMUNICATIONS, INC. PERFEXA SOLUTIONS, INC.
A Nevada corporation A Nevada corporation
By: _/s/ Xxxxxx DeCiccio_______ By:__Eric Clemons____________________
Its: President_________________ Its:_President_______________________
"THE COLLATERAL AGENT"
XXXXXXX X. XXXXXXX
_/s/ Xxxxxxx Mittman__________________
APPROVED BY "LENDERS":
__[signature illegible]_________ _/s/ Xxxxxxx X. Haas_________
ALPHA CAPITAL AKTIENGESELLSCHAFT DCOFI MASTER LDC
________________________________ _______________________________
__/s/ Xxxxxx Geduld_____________
SCG CAPITAL, LLC
__/s/ Xxxxxx Todd______________ __/s/ Xxxxxxx Unger____________
SILVER OAK INVESTMENTS, INC. XXXXX INTERNATIONAL LTD.
THIS GUARANTY AGREEMENT MAY BE SIGNED BY FACSIMILE SIGNATURE AND
DELIVERED BY CONFIRMED FACSIMILE TRANSMISSION.
