EXHIBIT 6.12
STOCK SALE AGREEMENT
NOW, THEREFORE, in consideration of the Promissory Note, the mutual
promises and agreements set forth herein and therein, and other valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto hereby agree as follows:
1. The Company shall direct its transfer agent to remove the restrictive
legend and allow the sale of up to 200,000 shares of common stock (the
"Stock") of Circle Group Internet Inc. ("the Company") under the
Securities Act of 1933 (the "Act") in reliance upon the exemption
therefrom contained in Section 4(1) of the Act and Rule 144 promulgated
by the Securities and Exchange Commission thereunder, owned by Xxxx X.
Xxxxxx ("the Note Holder").
2. The Company shall grant to Note Holder Nonstatutory Stock Options to
purchase up to 400,000 shares of common stock of the Company at an
exercise price equal to the average sale price of the total number of
shares sold pursuant to paragraph 3, below. The total number of
Nonstatutory Stock Options granted will be determined by multiplying
the total number of shares sold pursuant to paragraph 3, below by a
factor of 2 (Shares Sold X 2 = Nonstatutory Stock Option Grant).
3. Whereas, Circle Group Internet, Inc. and Xxxx X. Xxxxxx have entered
into a Promissory Note Agreement, dated as of November 15, 2002 (such
Promissory Note Agreement, as amended or otherwise modified from time
to time, the "Promissory Note"), pursuant to which the Company will
borrow, and the Note Holder will loan eighty percent (80%) of any and
all proceeds from the sale of the Stock of the Company, the funds for
the loan being derived from the sale of the common stock of Circle
Group Internet, Inc., per paragraph 1, above.
PROMISSORY NOTE
$7,100.00 November 15, 2002
FOR VALUE RECEIVED, the undersigned, Circle Group Internet Inc., an Illinois
corporation, hereby promises to pay to the order of Xxxx X. Xxxxxx (the "Note
Holder"), or assigns, in lawful money of the United States of America, the
principal sum of Seven Thousand One Hundred and 00/100 ($7,100.00) on November
15, 2002, or so much thereof as may have not been repaid from time to time, as
shown on Schedule I attached hereto, as such may be amended from time to time,
together with interest on the outstanding principal balance hereof (computed on
the basis of 360-day year of twelve 30-day months) at the rate of six and
three-quarters percent (6.75%) per annum, such interest payable upon maturity
of the note.
This note may be prepaid in whole or in part, without premium, penalty
or discount, at any time, or from time to time, at the option of the
undersigned, together with accrued interest on the amount prepaid.
Participations in this note may be assigned, in whole or in part, at
any time, or from time to time, at the option of Xxxx X. Xxxxxx or a
participant, such participations to be recorded on Schedule II attached hereto,
as such may be amended from time to time. In the event that one or more
participations in this note have been assigned, all participants shall
participate in all principal and interest payments pro rata in accordance with
their relative principal amounts.
Until this note has been repaid in full, an amount equal to the net
proceeds of any external financing of any kind conducted by the undersigned
whether through the issuance of debt or equity, but excluding any short-term
debt or any compensation-related equity issuance, shall be payable to the
undersigned to the participant or participants as a mandatory prepayment of
principal of this note immediately upon receipt of such proceeds by the
undersigned.
No waiver by Xxxx X. Xxxxxx or any participant of any rights or
remedies under this note shall be considered a waiver of any other subsequent
right or remedy. No delay or omission in the exercise by Xxxx X. Xxxxxx or any
participant of any rights or remedies and no exercise or enforcement of any such
rights or remedies shall be held to exhaust any other right or remedy.
The occurrence of any of the following events shall constitute an
"Event of Default" under this note:
(a) the undersigned shall fail to make any payment of principal due
hereunder for more than five business days after the due date
thereof, or shall fail to make any payment of interest due
hereunder for more than thirty days after the due date thereof,
(b) the undersigned shall commence any case or proceeding seeking to
have an order for relief entered on its behalf as debtor or to
adjudicate it as bankrupt or insolvent or seeking reorganization,
liquidation, dissolution, winding-up, arrangement, composition or
readjustment of its debts or any other relief under any
bankruptcy, insolvency, reorganization, liquidation, dissolution,
arrangement, composition, readjustment of debt or other similar
act or law of any jurisdiction, domestic or foreign, now or
hereafter existing; or the undersigned shall apply for a
receiver, custodian or trustee (other than any trustee appointed
as a mortgagee or secured party in connection with the issuance
of indebtedness for borrowed money of the undersigned) of it or
for all or a substantial part of its property; or the undersigned
shall make a general assignment for the benefit of creditors; or
the undersigned shall take any corporate action in furtherance of
any of the foregoing; or
(c) an involuntary case or other proceeding shall be commenced
against the undersigned with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in
effect seeking the appointment of a trustee, receiver,
liquidator, custodian or similar official of it or any
substantial part of its property; and such case or proceeding
(i) results in the entry of an order for
relief or a similar order against it or (ii) shall continue
unstayed and in effect for a period of 60 consecutive days.
Upon the occurrence of an Event of Default, the unpaid principal
balance of this note and accrued interest on this note shall become immediately
due and payable, without presentment, demand, protest or other formalities of
any kind, all of which are hereby expressly waived by the undersigned.
The substantive laws of the State of Illinois shall govern the
validity, construction, enforcement and interpretation of this note. In the
event of a dispute involving this note or any other instruments executed in
connection herewith, the undersigned irrevocably agrees that venue of such
dispute shall lie exclusively in any court of competent jurisdiction in Lake
County, Illinois.
CIRCLE GROUP INTERNET INC. CIRCLE GROUP INTERNET INC.
By: /s/ Xxxxxxx X. Xxxxxxx Accepted and Agreed /s/ Xxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxxx Name: Xxxx X. Xxxxxx
Title: President & CEO Title: Secretary and Director
Schedule I
Principal Payment Record
Date of Amount of Unpaid Name of Person
Repayment Principal Paid Principal Balance Making Notation
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Schedule II
Participations
Participant Amount of Principal
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