Exhibit 10.12
PROMISSORY NOTE EXTENSION AGREEMENT
THIS PROMISSORY NOTE EXTENSION AGREEMENT (the "Agreement") is entered into on
this 7th day of February, 2003, by and between Statmon Technologies, Corp., a
Nevada corporation located at 000 X. Xxxxx Xxxxx, Xxxxx 000, Xxxxxxx Xxxxx,
Xxxxxxxxxx, 00000 ("Statmon") and Thieme Consulting Inc., The Global Opportunity
Fund and Veinvest, all of which such notes are administered by Thieme
Consulting, Inc., 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx, 00000. Each
of Thieme Consulting, The Global Opportunity Fund and Veinvest are occasionally
referred to individually or collectively as "Holder" or "Holders."
RECITALS
A. WHEREAS, Statmon is the obligor pursuant to three Promissory Notes
between Statmon and Thieme Consulting Inc. dated November 7, 2001, The Global
Opportunity Fund dated November 7, 2001 and Veinvest dated November 6, 2001
(collectively the "Notes") which were executed contemporaneously with a Pledge
and Security Agreement dated October 12, 2001 (collectively, the "Note
Agreements");
B. WHEREAS, the original maturity dates of the Notes were April 16, 2002,
May 6, 2002, and May 18, 2002, respectively (the "Maturity Dates");
C. WHEREAS, Statmon and Holders desire to formally extend the Maturity
Date of the Note in exchange for certain additional obligations undertaken by
Statmon as set forth herein;
D. WHEREAS, Statmon is currently negotiating a separate Agreement for
Purchase and Sale of Remote Monitoring Products with Xxxxxx Corporation
("Xxxxxx"), (the "Xxxxxx Distribution Agreement");
E. WHEREAS, Holders have agreed to subrogate any interest securing the
Notes and provided for by the Note Agreements to the rights of Xxxxxx solely to
the extent set forth in that certain Security Interest Subordination and
Subrogation Agreement entered into by Statmon, Thieme Consulting, Inc. on behalf
of Holders, Xxxx X. Xxxx and Xxxxxx Corporation concurrently with the execution
of this Agreement., subject to Holders' written consent to the Xxxxxx
Distribution Agreement, which consent shall not be unreasonably withheld.
NOW, THEREFORE, in consideration of the premises and mutual covenants set
forth, and other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereby agree as follows:
AGREEMENT
1. EXTENSION OF MATURITY DATE. Pursuant to the terms and conditions
precedent and subsequently detailed in this Agreement, Holders collectively
agree to extend the Maturity Dates of the Notes as follows: the Maturity Dates
for all three Notes shall be extended up to and including June 30, 2003.
2. RESTATEMENT OF ORIGINAL PRINCIPAL. The parties agree that the original
outstanding principal amount owed by Statmon pursuant to all three Notes is
$250,000.
3. PAYMENT SCHEDULE. Notwithstanding any other payment arrangements set
forth in the Note Agreements, Statmon agrees to apply first monies from the net
proceeds from the sale of equity pursuant to an offering currently in the market
or the restructuring of the Company's debt, whichever occurs first, to the
repayment of the Notes. In any event all principal and interest to be paid in
full on or before June 30, 2003.
4. SUBROGATION OF SECURITY INTEREST. Notwithstanding any provision
contained within the Note Agreements relating to a security interest in any of
the assets of Statmon including, but not limited to, the intellectual property
of the company and/or any of its trademarks, Holders, individually and
collectively, hereby agree to subrogate any and all of their security interest
to Xxxxxx Corporation solely to the extent set forth in the Security Interest
Subordination and Subrogation Agreement entered into by Statmon, Thieme
Consulting, Inc. on behalf of Holders, Xxxx X. Xxxx and Xxxxxx Corporation
concurrently with the execution of this Agreement.
5. EXTENSION CONSIDERATION. In addition to the terms and conditions set
forth above, Statmon agrees to the following:
(a) Statmon to continue accruing penalty interest at 15% per annum,
plus, 25,000 shares per month. Statmon confirms it has instructed its transfer
agent to immediately issue all outstanding penalty share certificates due the
Holder pursuant to the terms of the Note Agreements, as amended up to and
including December 31, 2003;
(b) Statmon hereby agrees to issue to Holder an additional one-time
grant of 200,000 shares of its common stock and to instruct its transfer agent
to immediately issue all share certificates reflecting such additional shares;
(c) Statmon undertakes to include all the Holders' shares of Common
stock in its first Securities and Exchange Commission ("SEC") registration
statement filing under the Securities Act of 1933. The timetable for such filing
shall not be later than December 31, 2003. Notwithstanding the foregoing, the
Registration Rights Agreement made as of October 12, 2001, by and between
Statmon and Thieme Consulting, Inc., shall remain in full force and effect.
(d) Statmon agrees that, should its right to terminate the Xxxxxx
Distribution Agreement become exercisable at any time during the term of this
Agreement and while amounts under the Notes are still outstanding, Statmon will
immediately notify Holder of such right. Moreover, should Holder request that
Statmon exercise its right to terminate the Xxxxxx Distribution Agreement during
any time that Statmon has the right to do so, Statmon will immediately take all
steps to terminate the Xxxxxx Distribution Agreement.
6. MISCELLANEOUS.
(a) APPLICABLE LAW. This Agreement shall be construed in accordance
with, and any dispute arising in connection shall be governed by, the laws of
the State of New York.
(b) ASSIGNMENT. Except for an assignment or delegation that may
occur or be deemed to have occurred as a result of a merger, sale of assets or
other business combination in which the surviving party specifically assumes the
obligation of the other, no right, interest or obligation in the Agreement shall
be assigned or delegated.
(c) SECTION HEADINGS. The heading of the Sections are inserted for
reference only and are not intended to be part of nor affect the meaning or
interpretation of this Agreement.
(d) SEVERABILITY. If any term of this Agreement or portion of any
term of this Agreement is held as invalid or unenforceable, the remainder shall
not be affected, and each term and provision shall be valid and enforced to the
fullest extent permitted by law.
(e) WAIVER. A waiver by either party of any of the terms and
conditions or covenants to be performed by the other, including, but not limited
to, the extension of the maturity dates of the Notes hereunder, shall not be
construed to be a waiver of any succeeding breach, nor of any other term,
condition or covenant contained in this Agreement.
(f) ARBITRATION. Any dispute arising under this Agreement shall
first be submitted to mediation and then, if the matter has still not been
resolved, shall be resolved through arbitration in accordance with the rules of
the American Arbitration Association. Any such mediation or arbitration shall
take place in New York County, New York.
(g) ATTORNEYS' FEES. If it becomes necessary to bring suit to
enforce any provision of this Agreement, the prevailing party shall be entitled
to its reasonable attorneys' fees and costs of suit.
(h) ENTIRE AGREEMENT. This Agreement, together with the Note
Agreements, as amended, and the Security Interest Subordination and Subrogation
Agreement entered into by the parties concurrently herewith, contain the entire
understanding between the parties and may not be altered, varied, revised or
amended except by as agreed in writing by both parties and signed by both
parties. To the degree there is any inconsistency between the terms of this
Agreement and prior Note Agreements, as amended, the terms of this Agreement
shall control.
IN WITNESS WHEREOF, the parties have each executed and delivered this
Agreement as of the day and year first above written.
STATMON TECHNOLOGIES CORP.
By: /s/ Xxxxxxxx Xxxxxx
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Its: CEO
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THIEME CONSULTING, INC.
FOR AND ON BEHALF OF THE
NOTE HOLDERS
BY: /s/ Xxxxx Xxxxxx
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ITS:
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