LEASE/PURCHASE AND MANAGEMENT AGREEMENT
THIS LEASE/PURCHASE AND MANAGEMENT AGREEMENT is made as of the 15th
day of September, 2000, by and among WasteMasters, Inc., a Delaware
corporation (hereinafter called "Lessee"), WasteMasters, Inc., a Maryland
corporation ("WasteMasters") and Global Eco-Logical Services, Inc.
(hereinafter called "Lessor").
WITNESSETH:
1. Leased Property. Lessor, for and in consideration of the rents,
covenants, agreements, and stipulations hereafter mentioned, provided for
and contained to be paid, kept and performed by Lessee, leases and rents
unto Lessee, and Lessee hereby leases and takes upon the terms and
conditions which hereinafter appear, the following described property,
(hereinafter called the "Property"), to wit: Tri-State Waste Disposal,
Inc., a New Jersey corporation; Lisbon Landfill, Inc., a Florida
corporation; and All Waste Disposal Service, Inc., a Commonwealth of
Pennsylvania corporation (hereinafter, the "Corporations").
2. Term. The Lessee shall have and hold the Property for a term equal
to the shorter of one year or the date of Closing in the event the Lessee
exercises the Option (as defined herein).
3. Rental. Lessee agrees to pay to Lessor at the address of Lessor as
stated in this Lease, without demand, deduction or set off, monthly rental
of $10.00 per month. Monthly rental payments shall be paid in advance on
the first day of each calendar month during the term hereof. Upon
execution of this Lease, Lessee shall pay to Lessor the first full month's
rent due hereunder.
4. Management of Property. During the term of this Lease, the Lessee
shall have the sole and exclusive right to operate and manage the Property.
As sole shareholder of the Corporations, the Lessor hereby grants the
Lessee an irrevocable proxy during the term of this Lease to vote the
Lessor's shares in the Corporations to appoint such persons that the Lessee
deems advisable to the board of directors of each of the Corporations, and
the Lessee hereby agrees to replace the board of directors of each of the
Corporations with the Lessee's nominees promptly after execution of this
Lease. Lessor and Lessee agree that the foregoing proxy shall not entitle
the Lessee to vote the Lessor's shares of stock in the Corporations on any
matter other than the election of directors to the Corporations during the
term of this Lease, including without limitation any proposed merger, share
exchange, sale of assets, amendment to articles of incorporation or any
other act which requires approval of the shareholders of the Corporations
under the Corporations' articles of incorporation, bylaws or applicable
law. The Lessee further agrees that the foregoing proxy shall expire upon
the expiration or termination of this Lease, and that the foregoing proxy
is not exercisable at any time that the Lessee is in default under this
Lease. The Lessee further agrees that it will not take any action to cause
the Corporations to sell, mortgage, pledge or lease any assets outside the
ordinary course of business or file any petition for relief under the
United States Bankruptcy Code without the prior written consent of the
Lessor.
5. Additional Consideration. As consideration for this Agreement,
Lessee and WasteMasters, jointly and severally, will assume those certain
debt instruments in the Lessor (the "Debentures"), totaling $1,590,000,
plus accrued interest at 8.5% and permissible default fees, pursuant to and
in accordance with the Debenture Modification Agreements of the Lessor,
attached hereto as Exhibit A and incorporated herein by this reference.
The shares issued and delivered in accordance with this Agreement and the
attached Modification Agreement will be duly authorized, validly issued,
fully paid and nonassessable, free of any preemptive or other similar
rights of any person. The shares when delivered as set forth therein will
be registered and declared effective within 120 days from the date of this
Agreement pursuant to the Securities Act of 1933, as amended, on a
registration statement that has been declared effective by the SEC.
6. Operation of Property. The Lessee shall be responsible for
providing all management, consulting, financial, marketing and operational
support services to the Property. The Lessee shall be entitled to all
revenues generated by the Property and shall be responsible for paying all
expenses and liabilities incurred and accrued by the Property on and after
the date of this Agreement including, without limitation, all installments
of approved Company Debt and outstanding accounts payable. Lessee agrees
that it shall be responsible for providing funds to the Property to the
extent the expenses of the Property are greater than the revenues of the
Property during the term of this Lease determined on an accrual basis under
generally accepted accounting principles (but excluding any noncash
expenses such as depreciation or amortization of goodwill), and the Lesseee
shall be entitled to retain all profits generated by the Property
determined under the same principles. The obligations of the Lessee to
manage the Property include the obligation to:
(a) Administer, supervise and control all of the finances of the Property,
including payroll, taxes, accounting, bookkeeping, record keeping, managing
of accounts payable, and accounts receivable, banking, financial records
and reporting functions as they pertain to the business of the Property,
with the power to make such changes therein, in its sole discretion, and to
incorporate such functions into systems used by Lessee. Lessee shall
prepare and maintain financial statements for the Property according to
generally accepted accounting principles consistently applied and shall
provide the Lessor with monthly operating reports and statements including
but not limited to cash flow statements, income statements, accounts
payable and accounts receivable reports and such other reports and
information as may be requested by Lessor from time to time to enable the
Lessor to comply with its reporting requirements under the Securities
Exchange Act of 1934.
(b) Select and employ all personnel necessary to service the Property.
(c) Supervise and control the purchase of all materials and supplies, and
acquire, lease, dispose of and repair equipment and facilities necessary to
provide safe and adequate service to the business of the Property.
(d) Manage, at Lessee's sole discretion, all costs and all pricing on a
customer-by-customer basis, estimate all costs on new contracts, bid on and
enter into new contracts, and control all costs for contracts in progress.
(e) Commence, defend and control all legal actions, arbitrations,
investigations and proceedings that arise or are pending during the term of
this Lease.
(f) Maintain the assets of the Property in good repair, order and
condition, normal and reasonable wear and tear excepted.
7. Licenses and Permits. The parties acknowledge that this Lease as
well as the transfer of the Property to the Lessee pursuant to the option
herein may be subject to approval by the State of Ohio Environmental
Protection Agency, and similar state agencies in New Jersey and
Pennsylvania and they will cooperate in seeking such approval. The Lessee
shall be responsible for the cost of transferring or obtaining any licenses
or permits necessary to conduct the business of the Property, and for
maintaining such licenses and permits in good standing during the term of
this Lease.
8. Books and Records. The Lessor shall provide the Lessee with access
to all books and records necessary for the transition of management of the
Property to the Lessee hereunder, including any corporate records of the
Property, any payroll records for employees of the Property, any customer
lists, and any financial records, such as the general ledger, accounts
payable, accounts receivable, etc. Promptly after the termination or
expiration of this Lease, the Lessee shall turn over to the Lessor all
books and records relating to or generated during the Lessee's operation of
the Property during the term of this Lease, or which was turned over to
Lessee at the commencement of this Lease.
9. No Agency. The Lessee shall, at all times, be independent of the
Lessor. Nothing contained herein shall be deemed to make or render the
Lessor a partner, co-venturer or other participant in the business or
operations of the Lessee, or in any manner to render Lessor liable, as
principal, surety, guarantor, agent or otherwise for any of the debts,
obligations or liabilities of the Property incurred during the term of this
Lease.
10. Abandonment of Property. Lessee agrees not to abandon or vacate
the Property during the term of this Lease and agrees to use the Property
for the purposes herein leased until the expiration hereof.
11. Indemnity; Insurance. Lessee agrees to and hereby does indemnify
and save Lessor harmless against all claims for damages to persons or
property by reason of Lessee's use or occupancy of the Property, and all
expenses incurred by Lessor because thereof, including attorney's fees and
court costs. Lessee agrees that it will, at its own expense, at all times
procure for, deliver to and maintain for the benefit of Lessor during the
term of this Lease, original paid up insurance policies of such insurance
companies, in such amounts, in such form and substance, and with such
expiration dates as are acceptable to Lessor and which name the Lessor as
additional insured. Until the Lessee is notified otherwise in writing by
the Lessor, the Lessee shall maintain the following insurance: (a)
Comprehensive General Liability of $1,000,000.00, which includes insurance
against liability for injury to or death of persons or loss or damage to
their property occurring in or about the Property; (b) Hazard insurance
against loss or damage to the Property by fire, lightning, windstorm, hail,
explosion, riot, riot attending a strike, civil commotion, aircraft,
vehicles, smoke, vandalism and malicious mischief and against such other
hazards as, under good insurance practices, from time to time are insured
against for properties of similar character and location, the amount of
which insurance shall be not less than one hundred (100.0%) per cent of the
full replacement cost of the Property without deduction for depreciation
and which policies of insurance shall contain satisfactory replacement cost
endorsements. Lessee shall deliver to Lessor a certificate of any renewal
insurance policies on or before the date of expiration of any existing
insurance policy.
12. Governmental Orders. Lessee agrees, at his own expense, to comply
promptly with all requirements of any legally constituted public authority
made necessary by reason of Lessee's occupancy and management of the
Property. Lessor agrees to comply promptly with any such requirements if
not made necessary by reason of Lessee's occupancy and management.
13. Assignment and Subletting. Lessee shall not have the right to
sublease the Property or any part thereof, assign this Lease or any
interest hereunder, or permit the use of the Property by another party
other than the Lessee without the prior written consent of Lessor. No
sublease or assignment by Lessee shall relieve Lessee of any liability
hereunder.
14. Termination of Lease. Lessor may, at its option, upon ten (10)
days' written notice terminate this Lease (if such default is not cured
within such ten (10) day period or such longer period as required to effect
a cure if a cure is commenced within 10 days and diligently prosecuted):
(i) if Lessee shall violate any material provision of this Lease; (ii) if
Lessee shall violate or be in material breach of any provision,
representation, warranty, covenant or undertaking herein; or (iii) if
Lessee (a) makes an assignment for the benefit of creditors, (b) is
adjudicated a bankrupt, (c) files or has filed against it any bankruptcy,
reorganization, liquidation or similar petition or any petition seeking
the appointment of a receiver, conservator or other representative, or (d)
proposes a composition arrangement with creditors. Termination of the
Lease pursuant to this paragraph shall not limit or impair any other rights
which the Lessor has hereunder, including without limitation the right to
file suit against the Lessee to recover damages for the violation of any
term herein or to right to set off any debt which the Lessor may owe the
Lessee against any liability of the Lessee to the Lessor hereunder.
15. Quiet Enjoyment. So long as Lessee observes and performs the
covenants and agreements contained herein, it shall at all times during the
Lease term peacefully and quietly have and enjoy possession of the
Property, but always subject to the terms hereof.
16. No Estate in Property. This Lease shall create the relationship of
Lessor and Lessee between the parties hereto. No estate shall pass out of
Lessor. Lessee has only a usufruct not subject to levy and sale, and not
assignable by Lessee except by Lessor's consent.
17. Attorney's Fees. In the event that any action or proceeding is
brought to enforce any term, covenant or condition of this Lease on the
part of Lessor or Lessee, the prevailing party in such litigation shall be
entitled to recover reasonable attorney's fees to be fixed by the court in
such action or proceeding. Furthermore, Lessor and Lessee agree to pay the
attorney's fees and expenses of the other party to this Lease (either
Lessor or Lessee) if it is made a party to litigation because of its being
a party to this Lease and when it has not engaged in any wrongful conduct
itself.
18. Press Releases. No publicity release or announcement concerning
this Lease or the Option or the transactions contemplated hereby shall be
issued without advance approval of the form and substance thereof by Lessor
or Lessee.
19. Rights Cumulative. All rights, powers, and privileges conferred
hereunder upon the parties hereto shall be cumulative and not restrictive
of those given by law.
20. Waiver of Rights. No failure of Lessor to exercise any power
given Lessor hereunder or to insist upon strict compliance by Lessee of its
obligations hereunder and no custom or practice of the parties at variance
with the terms hereof shall constitute a waiver of Lessor's right to demand
exact compliance with the terms hereof.
21. Agency Disclosure. Lessor represents to Lessee that Lessor has
not engaged any agent in regard hereto or to the sale or lease of the
Property, and Lessor hereby agrees to indemnify Lessee and hold Lessee
harmless against all liability, loss, cost, damage and expense (including,
without limitation, attorneys' fees and cost of litigation) Lessee shall
ever suffer or incur because of any claim by any agent claiming by, through
or under Lessor, whether or not meritorious, for any fee, commission or
other compensation with respect hereto. Lessee represents to Lessor that it
has not engaged any agent in regard hereto, and Lessee hereby agrees to
indemnify Lessor and hold Lessor harmless against all liability, loss,
cost, damage and expense (including, without limitation, attorneys' fees
and cost of litigation) Lessor shall ever suffer or incur because of any
claim by any agent claiming by, through or under Lessee, whether or not
meritorious, for any fee, commission or other compensation with respect
hereto or with respect to the Property.
22. Environmental Laws. Lessor represents, to the best of their
knowledge and belief, that 1) the Property are in compliance with all
applicable environmental laws, and 2) there are not excessive levels (as
defined by the Environmental Protection Agency) of radon, toxic waste or
hazardous substances on the Property. Lessee represents and warrants that
Lessee shall comply with all applicable environmental laws and that Lessee
shall not permit any of his employees, agents, contractors for
subcontractors, or any person present on the Property to generate,
manufacture, store, dispose or release on, about, or under the Property any
hazardous substances which would result in the Property not complying with
any applicable environmental laws, and Lessee hereby indemnifies and holds
Lessor harmless from any liability or claim, including attorney's fees
incurred by Lessor, arising out of a breach of Lessor's obligations under
this paragraph.
23. Option to Purchase. The Lessor hereby grants to the Lessee an
option to purchase the Property on the terms and conditions set forth
below:
a) Option Price. The Lessee may purchase the Property for Fifteen Million
(15,000,000) shares of WasteMasters common stock or its cash equivalent,
guaranteed at $.15 per share or "market price," whichever is higher at time
of conversion.
When issued and delivered in accordance with this Agreement, the shares
will be duly authorized, validly issued, fully paid and nonassessable, free
of any preemptive or other similar rights of any person. The shares, when
delivered as set forth herein will be registered pursuant to the Securities
Act of 1933, as amended, on a registration statement that has been declared
effective by the SEC.
b) Term of Option. The Lessee may exercise this Option at any time prior to
the expiration or termination of this Lease.
c) Manner of Exercise of Option. The Lessee may exercise this Option by
written notice to the Lessor in the manner set forth in this Lease for the
giving of notice to the Lessor. Such notice shall state the Lessee's
election to exercise this Option, shall be signed by an officer of the
Lessee, and shall state a date, time and location in the Charleston, South
Carolina metro area where the Closing of the purchase of the Property will
take place, which date shall be between 5 and 10 days after the date of
receipt of such notice. The exercise of the Option by the Lessee shall
constitute a binding obligation on the part of the Lessee to purchase the
Property on the terms and conditions set forth herein and on the Lessor to
convey the Property on the terms and conditions set forth herein.
d) Title to Property. In the event the Option is exercised, the
Corporations shall be conveyed to the Lessee by assignment of all of the
issued and outstanding common stock of the Corporations to the Lessee by
the Lessor free and clear of all liens, claims or encumbrances.
e) Condition of Property. In the event the Option is exercised, the
Property shall be conveyed to the Lessee "as is, where is," without any
express or implied warranties, including any warranties of condition, of
merchantability or fitness for a particular purpose. Furthermore, the
Lessor makes no warranties as to the financial condition of the
Corporations, it being understood by the parties that the Lessee shall
conduct any due diligence investigation of the Property while it is the
Lessee under this Lease prior to exercising the Option to purchase the
Property.
f) Conditions to Conveyance. The Lessee acknowledges and agrees that the
Lessor's obligation to convey the Property is conditioned upon the
subsequent approval of the Option price by the board of directors of the
Lessor after receipt of such independent valuations or reports as may be
necessary in the judgment of the board to determine that the Option price
fairly represents the value of the Property. The Lessor agrees to
commission and obtain any fairness opinions or reports which it may need to
approve the Option price herein as soon as practical after the execution of
this Lease.
24. Time of Essence. Time is of the essence with respect to this
Lease.
25. Notices. All notices required or permitted under this Lease shall
be in writing and shall be personally delivered or sent by U.S. Certified
Mail, return receipt requested, postage prepaid. Agent shall be copied
with all required or permitted notices. Notices to Lessee shall be
delivered or sent to the address shown below, except that upon Lessee's
taking possession of the Property, the Property shall be Lessee's address
for notice purposes. Notices to Lessor and Agent shall be delivered or
sent to the addresses hereinafter stated, to wit:
Lessor:
Global Eco-Logical Services, Inc.
C/O: Xxxxxxx X. Xxxxxx, Xx.
0 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
(000) 000-0000
Fax: (000) 000-0000
Lessee:
WasteMasters, Inc.
C/O: Xxxxxxx Xxxxxxx
000 Xxxxx Xxxxxxxx Xxx.
Xxxxxxxx Xxxx, XX 00000
(000) 000-0000
Fax: (000) 000-0000
All notices shall be effective upon delivery. Any party may change his
notice address upon written notice to the other parties.
26. Entire Agreement. This Lease contains the entire agreement of the
parties hereto, and no representations, inducements, promises or
agreements, oral or otherwise, between the parties not embodied herein,
shall be relied upon by the other party or be of any force or effect.
IN WITNESS WHEREOF, the parties herein have hereunto set their hands
and seals, in triplicate, the date and year first above written.
LESSEE:
WASTEMASTERS OF DELAWARE, INC.
/s/ Xxxxxxx Xxxxxxx
By: Xxxxxxx Xxxxxxx, Secretary
ATTEST:
________________________________
By: _____________________________
[SEAL]
LESSOR:
GLOBAL ECO-LOGICAL SERVICES, INC.
/s/ Xxxxxxx X. Xxxxxx
By: Xxxxxxx X. Xxxxxx, Xx., President
ATTEST:
________________________________
By: _____________________________
[SEAL]
Agreed and Assented to:
WASTEMASTERS, INC.
/s/ Xxxxxxx Xxxxxxx
By: Xxxxxxx Xxxxxxx, Secretary
ATTEST:
________________________________
By: _____________________________
[SEAL]
Exhibit A
Debenture Modification Agreements
SECOND AMENDMENT TO PROMISSORY NOTE
THIS SECOND AMENDMENT TO PROMISSORY NOTE is entered this 15th day of
September, 2000, by and between Global Eco-Logical Services, Inc., a
Florida corporation ("Maker"), WasteMasters, Inc., a Maryland corporation
("WMI"), and Beta Communications Corporation ("Noteholder").
WHEREAS, the Maker and the Noteholder are parties to a Promissory Note
dated June 1, 1999 in the original principal amount of $510,000.00;
WHEREAS, the Maker and the Noteholder entered into an Amendment to
Promissory Note dated March 1, 2000, to amend certain terms thereof;
WHEREAS, the Maker has agreed to sell certain assets to WMI, which has
agreed to assume payment of the Promissory Note, its accrued interest, and
permissible default fees, as partial consideration for the Lease/Purchase
and Management Agreement, and in connection with such assumption, the
Maker, WMI and the Noteholder have entered into this Second Amendment to
evidence the Noteholder's consent to the assumption of the Promissory Note
by WMI and the terms of an amendment to the Promissory Note;
NOW, THEREFORE, in consideration of the promises and mutual agreements
herein contained, it is agreed by and between the parties hereto as
follows:
1. The Seventh Paragraph of the Note is hereby deleted and replaced in
its entirety with the following language:
"This Note shall be convertible, at the sole option of the Holder, into
paid and non-assessable shares of Common Stock of the Maker or
WasteMasters, Inc. ("WMI") as specified in a notice of conversion delivered
to the office of both the Maker and WMI at such places that they may from
time to time determine (all future references to "Common Stock" in this
paragraph shall refer to the Common Stock of WMI or the Maker as specified
in a notice of conversion). The number of shares of Common Stock issuable
upon conversion of this Note shall be equal to $1,000.00 divided by the
applicable Conversion Price in effect at the time of conversion determined
as hereinafter provided for each $1,000 in principal and accrued interest
due on this Note at the time of conversion. The price at which shares of
Common Stock shall be delivered upon conversion (the "Conversion Price")
shall be the Current Bid Price (as hereinafter defined) of the Common Stock
of the applicable company as of the close of business on the day
immediately preceding the date of conversion; provided, however, that such
Conversion Price shall be subject to adjustment from time to time in
certain instances as hereinafter provided; and further provided that in no
event shall the Conversion Price for Common Stock of WMI be less than $0.10
per share. No payment or adjustment shall be made in respect of dividends
previously declared and paid on the Common Stock upon conversion of part or
all of this Note into shares of Common Stock. If the Maker elects to prepay
part or all of this Note, such right of conversion shall cease and
terminate, as to the portion designated for prepayment, at the close of
business on the prepayment date, unless the Maker defaults in the
prepayment. No fractional shares of Common Stock will be issued, and
instead the number of shares of Common Stock to be issued on conversion of
this Note will, to the extent necessary, be rounded up to the nearest whole
number of shares."
2. The Noteholder hereby consents to the assumption of the Promissory
Note by WMI, and WMI hereby agrees to perform all obligations of the Maker
thereunder is if it were the original Maker thereunder.
3. In the event the Noteholder elects to convert any part of the
Promissory Note into shares of Common Stock of the Maker, then WMI shall
reimburse the Maker for such conversion by issuing the Maker that number of
shares of Common Stock of WMI which WMI would have been obligated to issue
the Noteholder if the Noteholder had instead elected to convert such part
of the Promissory Note into shares of Common Stock of WMI.
4. All terms and conditions in the Promissory Note shall remain
unchanged except to the extent specifically modified herein. All terms
defined in the Promissory Note shall have the same meaning herein that they
are defined to have the Promissory Note, unless specifically provided
otherwise.
IN WITNESS HEREOF, the parties have executed this Agreement, as of the
date first written above.
MAKER:
GLOBAL ECO-LOGICAL SERVICES, INC., a Florida corporation
By: ________________________________
Xxxxxxx X. Xxxxxx, Xx., President
HOLDER:
By: ________________________________
Print Name: _________________________
WMI:
WASTEMASTERS, INC., a Maryland corporation
By: ____________________________________
Xxxxxxx X. Xxxxxxx, Secretary
SECOND AMENDMENT TO PROMISSORY NOTE
THIS SECOND AMENDMENT TO PROMISSORY NOTE is entered this 15th day of
September, 2000, by and between Global Eco-Logical Services, Inc., a
Florida corporation ("Maker"), WasteMasters, Inc., a Maryland corporation
("WMI"), and Xxxxxxxxxxx Xxxxxxx ("Noteholder").
WHEREAS, the Maker and the Noteholder are parties to a Promissory
Note dated June 1, 1999 in the original principal amount of $850,000.00;
WHEREAS, the Maker and the Noteholder entered into an Amendment to
Promissory Note dated March 1, 2000, to amend certain terms thereof;
WHEREAS, the Maker has agreed to sell certain assets to WMI, which
has agreed to assume payment of the Promissory Note, its accrued interest,
and permissible default fees, as partial consideration for the
Lease/Purchase and Management Agreement, and in connection with such
assumption, the Maker, WMI and the Noteholder have entered into this Second
Amendment to evidence the Noteholder's consent to the assumption of the
Promissory Note by WMI and the terms of an amendment to the Promissory
Note;
NOW, THEREFORE, in consideration of the promises and mutual
agreements herein contained, it is agreed by and between the parties hereto
as follows:
1. The Seventh Paragraph of the Note is hereby deleted and replaced
in its entirety with the following language:
"This Note shall be convertible, at the sole option of the Holder, into
paid and non-assessable shares of Common Stock of the Maker or
WasteMasters, Inc. ("WMI") as specified in a notice of conversion delivered
to the office of both the Maker and WMI at such places that they may from
time to time determine (all future references to "Common Stock" in this
paragraph shall refer to the Common Stock of WMI or the Maker as specified
in a notice of conversion). The number of shares of Common Stock issuable
upon conversion of this Note shall be equal to $1,000.00 divided by the
applicable Conversion Price in effect at the time of conversion determined
as hereinafter provided for each $1,000 in principal and accrued interest
due on this Note at the time of conversion. The price at which shares of
Common Stock shall be delivered upon conversion (the "Conversion Price")
shall be the Current Bid Price (as hereinafter defined) of the Common Stock
of the applicable company as of the close of business on the day
immediately preceding the date of conversion; provided, however, that such
Conversion Price shall be subject to adjustment from time to time in
certain instances as hereinafter provided; and further provided that in no
event shall the Conversion Price for Common Stock of WMI be less than $0.10
per share. No payment or adjustment shall be made in respect of dividends
previously declared and paid on the Common Stock upon conversion of part or
all of this Note into shares of Common Stock. If the Maker elects to prepay
part or all of this Note, such right of conversion shall cease and
terminate, as to the portion designated for prepayment, at the close of
business on the prepayment date, unless the Maker defaults in the
prepayment. No fractional shares of Common Stock will be issued, and
instead the number of shares of Common Stock to be issued on conversion of
this Note will, to the extent necessary, be rounded up to the nearest whole
number of shares."
2. The Noteholder hereby consents to the assumption of the Promissory
Note by WMI, and WMI hereby agrees to perform all obligations of the Maker
thereunder is if it were the original Maker thereunder.
3. In the event the Noteholder elects to convert any part of the
Promissory Note into shares of Common Stock of the Maker, then WMI shall
reimburse the Maker for such conversion by issuing the Maker that number of
shares of Common Stock of WMI which WMI would have been obligated to issue
the Noteholder if the Noteholder had instead elected to convert such part
of the Promissory Note into shares of Common Stock of WMI.
4. All terms and conditions in the Promissory Note shall remain
unchanged except to the extent specifically modified herein. All terms
defined in the Promissory Note shall have the same meaning herein that they
are defined to have the Promissory Note, unless specifically provided
otherwise.
IN WITNESS HEREOF, the parties have executed this Agreement, as of the
date first written above.
MAKER:
GLOBAL ECO-LOGICAL SERVICES, INC., a Florida corporation
By: ________________________________
Xxxxxxx X. Xxxxxx, Xx., President
HOLDER:
By: ________________________________
Print Name: _________________________
WMI:
WASTEMASTERS, INC., a Maryland corporation
By: ____________________________________
Xxxxxxx X. Xxxxxxx, Secretary
SECOND AMENDMENT TO PROMISSORY NOTE
THIS SECOND AMENDMENT TO PROMISSORY NOTE is entered this 15th day of
September, 2000, by and between Global Eco-Logical Services, Inc., a
Florida corporation ("Maker"), WasteMasters, Inc., a Maryland corporation
("WMI"), and Pioneer Holdings, Inc. ("Noteholder").
WHEREAS, the Maker and the Noteholder are parties to a Promissory Note
dated June 1, 1999 in the original principal amount of $100,000.00;
WHEREAS, the Maker and the Noteholder entered into an Amendment to
Promissory Note dated March 1, 2000, to amend certain terms thereof;
WHEREAS, the Maker has agreed to sell certain assets to WMI, which has
agreed to assume payment of the Promissory Note, its accrued interest, and
permissible default fees, as partial consideration for the Lease/Purchase
and Management Agreement, and in connection with such assumption, the
Maker, WMI and the Noteholder have entered into this Second Amendment to
evidence the Noteholder's consent to the assumption of the Promissory Note
by WMI and the terms of an amendment to the Promissory Note;
NOW, THEREFORE, in consideration of the promises and mutual agreements
herein contained, it is agreed by and between the parties hereto as
follows:
1. The Seventh Paragraph of the Note is hereby deleted and replaced in
its entirety with the following language:
"This Note shall be convertible, at the sole option of the Holder, into
paid and non-assessable shares of Common Stock of the Maker or
WasteMasters, Inc. ("WMI") as specified in a notice of conversion delivered
to the office of both the Maker and WMI at such places that they may from
time to time determine (all future references to "Common Stock" in this
paragraph shall refer to the Common Stock of WMI or the Maker as specified
in a notice of conversion). The number of shares of Common Stock issuable
upon conversion of this Note shall be equal to $1,000.00 divided by the
applicable Conversion Price in effect at the time of conversion determined
as hereinafter provided for each $1,000 in principal and accrued interest
due on this Note at the time of conversion. The price at which shares of
Common Stock shall be delivered upon conversion (the "Conversion Price")
shall be the Current Bid Price (as hereinafter defined) of the Common Stock
of the applicable company as of the close of business on the day
immediately preceding the date of conversion; provided, however, that such
Conversion Price shall be subject to adjustment from time to time in
certain instances as hereinafter provided; and further provided that in no
event shall the Conversion Price for Common Stock of WMI be less than $0.10
per share. No payment or adjustment shall be made in respect of dividends
previously declared and paid on the Common Stock upon conversion of part or
all of this Note into shares of Common Stock. If the Maker elects to prepay
part or all of this Note, such right of conversion shall cease and
terminate, as to the portion designated for prepayment, at the close of
business on the prepayment date, unless the Maker defaults in the
prepayment. No fractional shares of Common Stock will be issued, and
instead the number of shares of Common Stock to be issued on conversion of
this Note will, to the extent necessary, be rounded up to the nearest whole
number of shares."
2. The Noteholder hereby consents to the assumption of the Promissory
Note by WMI, and WMI hereby agrees to perform all obligations of the Maker
thereunder is if it were the original Maker thereunder.
3. In the event the Noteholder elects to convert any part of the
Promissory Note into shares of Common Stock of the Maker, then WMI shall
reimburse the Maker for such conversion by issuing the Maker that number of
shares of Common Stock of WMI which WMI would have been obligated to issue
the Noteholder if the Noteholder had instead elected to convert such part
of the Promissory Note into shares of Common Stock of WMI.
4. All terms and conditions in the Promissory Note shall remain
unchanged except to the extent specifically modified herein. All terms
defined in the Promissory Note shall have the same meaning herein that they
are defined to have the Promissory Note, unless specifically provided
otherwise.
IN WITNESS HEREOF, the parties have executed this Agreement, as of the
date first written above.
MAKER:
GLOBAL ECO-LOGICAL SERVICES, INC., a Florida corporation
By: ________________________________
Xxxxxxx X. Xxxxxx, Xx., President
HOLDER:
By: ________________________________
Print Name: _________________________
WMI:
WASTEMASTERS, INC., a Maryland corporation
By: ____________________________________
Xxxxxxx X. Xxxxxxx, Secretary
SECOND AMENDMENT TO PROMISSORY NOTE
THIS SECOND AMENDMENT TO PROMISSORY NOTE is entered this 15th day of
September, 2000, by and between Global Eco-Logical Services, Inc., a
Florida corporation ("Maker"), WasteMasters, Inc., a Maryland corporation
("WMI"), and Xxxxxx Xxxxx ("Noteholder").
WHEREAS, the Maker and the Noteholder are parties to a Promissory Note
dated June 1, 1999 in the original principal amount of $130,000.00;
WHEREAS, the Maker and the Noteholder entered into an Amendment to
Promissory Note dated March 1, 2000, to amend certain terms thereof;
WHEREAS, the Maker has agreed to sell certain assets to WMI, which has
agreed to assume payment of the Promissory Note, its accrued interest, and
permissible default fees, as partial consideration for the Lease/Purchase
and Management Agreement, and in connection with such assumption, the
Maker, WMI and the Noteholder have entered into this Second Amendment to
evidence the Noteholder's consent to the assumption of the Promissory Note
by WMI and the terms of an amendment to the Promissory Note;
NOW, THEREFORE, in consideration of the promises and mutual agreements
herein contained, it is agreed by and between the parties hereto as
follows:
1. The Seventh Paragraph of the Note is hereby deleted and replaced in
its entirety with the following language:
"This Note shall be convertible, at the sole option of the Holder, into
paid and non-assessable shares of Common Stock of the Maker or
WasteMasters, Inc. ("WMI") as specified in a notice of conversion delivered
to the office of both the Maker and WMI at such places that they may from
time to time determine (all future references to "Common Stock" in this
paragraph shall refer to the Common Stock of WMI or the Maker as specified
in a notice of conversion). The number of shares of Common Stock issuable
upon conversion of this Note shall be equal to $1,000.00 divided by the
applicable Conversion Price in effect at the time of conversion determined
as hereinafter provided for each $1,000 in principal and accrued interest
due on this Note at the time of conversion. The price at which shares of
Common Stock shall be delivered upon conversion (the "Conversion Price")
shall be the Current Bid Price (as hereinafter defined) of the Common Stock
of the applicable company as of the close of business on the day
immediately preceding the date of conversion; provided, however, that such
Conversion Price shall be subject to adjustment from time to time in
certain instances as hereinafter provided; and further provided that in no
event shall the Conversion Price for Common Stock of WMI be less than $0.10
per share. No payment or adjustment shall be made in respect of dividends
previously declared and paid on the Common Stock upon conversion of part or
all of this Note into shares of Common Stock. If the Maker elects to prepay
part or all of this Note, such right of conversion shall cease and
terminate, as to the portion designated for prepayment, at the close of
business on the prepayment date, unless the Maker defaults in the
prepayment. No fractional shares of Common Stock will be issued, and
instead the number of shares of Common Stock to be issued on conversion of
this Note will, to the extent necessary, be rounded up to the nearest whole
number of shares."
2. The Noteholder hereby consents to the assumption of the Promissory
Note by WMI, and WMI hereby agrees to perform all obligations of the Maker
thereunder is if it were the original Maker thereunder.
3. In the event the Noteholder elects to convert any part of the
Promissory Note into shares of Common Stock of the Maker, then WMI shall
reimburse the Maker for such conversion by issuing the Maker that number of
shares of Common Stock of WMI which WMI would have been obligated to issue
the Noteholder if the Noteholder had instead elected to convert such part
of the Promissory Note into shares of Common Stock of WMI.
4. All terms and conditions in the Promissory Note shall remain
unchanged except to the extent specifically modified herein. All terms
defined in the Promissory Note shall have the same meaning herein that they
are defined to have the Promissory Note, unless specifically provided
otherwise.
IN WITNESS HEREOF, the parties have executed this Agreement, as of the
date first written above.
MAKER:
GLOBAL ECO-LOGICAL SERVICES, INC., a Florida corporation
By: ________________________________
Xxxxxxx X. Xxxxxx, Xx., President
HOLDER:
By: ________________________________
Print Name: _________________________
WMI:
WASTEMASTERS, INC., a Maryland corporation
By: ____________________________________
Xxxxxxx X. Xxxxxxx, Secretary
