AMENDMENT AGREEMENT
AMENDMENT
AGREEMENT, dated of
as February 20, 2008, by and between UNICORP, INC., (“Company”),
YAGLOBAL
INVESTMENTS, L.P.
(formerly, CORNELL CAPITAL PARTNERS, LP) (“YA
Global”). All capitalized terms used herein shall have the
respective meanings assigned thereto in the Transaction Documents (as defined
below) unless otherwise defined herein.
W
I T N E S S E T H:
WHEREAS,
Company and YA Global
have entered into certain financing arrangements set forth on Schedule A attached
hereto and referred to herein as the “Transaction
Documents” pursuant to which, YA Global is the holder of the
following secured convertible debentures (collectively, the “Debentures”) issued
by Company:
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Debenture
Description
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Principal
Outstanding
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Secured
Convertible Debenture (no. UCPI-1-1) issued on May 17, 2007 in the
original principal amount of $3,500,000
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$3,096,155
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Secured
Convertible Debenture (no. UCPI-1-2) issued on June 29, 2007 in the
original principal amount of $2,000,000
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$1,769,231
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Secured
Convertible Debenture (no. UCPI-1-3) issued on October 23, 2007 in
the
original principal amount of $1,500,000
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$1,384,616
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WHEREAS,
pursuant to the
Debentures, the Company was to make an installment payment of $288,461 on
January 1 and February 1, 2008 and has requested that YA Global defer or reduce
the amount of such payment as well as future payments.
WHEREAS,
YA Global desires to
make certain accommodations to the Company regarding the amount of the
installment payments and the time the Company has to make such payments and
in
exchange for such accommodations, the Company agrees, among other things, to
increase the interest rate of the Debentures and to certain other covenants
as
set forth herein.
NOW,
THEREFORE, in
consideration of the foregoing, and the respective agreements, warranties and
covenants contained herein, the parties hereto agree, covenant and warrant
as
follows:
1
1. Acknowledgements.
a. Acknowledgement
of
Obligations. Company hereby acknowledges, confirms and agrees
that as of the date hereof, Company is indebted to the YA Global under the
Debentures and the Transaction Documents in the outstanding principal amount
set
forth in the first Whereas clause above, plus accrued and unpaid interest
thereon, and any other fees, costs, expenses and other charges now or hereafter
payable (collectively, the “Obligations”) and
such Obligations are unconditionally owed by Company to YA Global, without
offset, defense or counterclaim of any kind, nature or description
whatsoever.
b. Acknowledgement
of Security
Interests. Company hereby acknowledges, confirms and agrees
that YA Global has and shall continue to have valid, enforceable and perfected
first-priority liens upon and security interests in the Pledged Property
heretofore granted to YA Global pursuant to the Security Agreement (the “Security Agreement”)
between Company, Affiliated Holdings, Inc., and YA Global dated May 17, 2007,
the Mortgage, Assignment of Production, Security Agreement, Fixture Filing
and
Financing Statement (the “Mortgage”) granted
by
the Company to YA Global as of May 17, 2007, Deed of Trust, Mortgage,
Assignment, Security Agreement, Fixture Filing and Financing Statement (the
“Deed of
Trust”) granted by the Company to YA Global as of May 17, 2007, or
otherwise granted to or held by YA Global. Company and Affiliated
Holdings, Inc. hereby acknowledge, confirm and agree that YA Global has and
shall continue to have valid, enforceable and perfected first-priority liens
upon and security interests heretofore granted to YA Global pursuant to the
Security Agreement, the Mortgage, the Deed of Trust or otherwise granted to
or
held by YA Global.
c. Binding
Effect of
Documents. Company and Affiliated Holdings, Inc. hereto
acknowledge, confirm and agree that: (a) each of the Transaction
Documents to which it is a party has been duly executed and delivered to YA
Global by Company or Affiliated Holdings, Inc., and each is in full force and
effect as of the date hereof, (b) the agreements and obligations of Company
or Affiliated Holdings, Inc. contained in such documents and in this Agreement
constitute the legal, valid and binding obligations of Company and Affiliated
Holdings, Inc., enforceable against each in accordance with their respective
terms, and Company and Affiliated Holdings, Inc. have no valid defense to the
enforcement of such obligations, and (c) YA Global is and shall be entitled
to the rights, remedies and benefits provided for in the Transaction Documents
and applicable law, without setoff, defense or counterclaim of any kind, nature
or descriptions whatsoever.
d. No
Other Waivers;
Reservation of Rights. YA Global reserves the right, in its
discretion, to exercise any or all of its rights and remedies under the
Transaction Documents as a result of any Event of Default which may be
continuing on the date hereof or any Event of Default which may occur after
the
date hereof, and YA Global has not waived any of such rights or remedies, and
nothing in this Agreement, and no delay on its part in exercising any such
rights or remedies, should be construed as a waiver of any such rights or
remedies.
2
2. Covenants
and
Agreements.
a. Amendments
to the
Debentures. The parties agree that as of the date hereof, the following
amendments shall be made to the Debentures:
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i.
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The
Interest Rate shall be changed to 14%. If an Event of Default
occurs and for so long as such Event of Default remains uncured,
the
Interest Rate on this Debenture shall immediately become eighteen
percent
(18%) per annum and shall remain at such increased interest rate
until the
applicable Event of Default is
cured
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ii.
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The
Maturity Date shall be changed to December 31,
2010.
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iii.
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The
Conversion Price shall be changed to $0.15, subject to adjustment
as set
forth in the Debentures.
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iv.
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The
Installment Amount shall be changed to $100,000, which amounts shall
first
be applied to all accrued and unpaid interest on all the Debentures
and
then to Principal beginning with the most recently issued
Debentures. Furthermore, the Company shall make a one-time
balloon payment in addition to Installment Payments of $1,300,000
due and
payable on December 31, 2009.
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v.
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The
January 1 and February 1, 2008 Installment Dates shall be deferred
and the
next Installment Date shall be March 1,
2008.
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vi.
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On
the date hereof, the Company shall issue amended and restated Debentures
in the form attached hereto as Exhibit A to reflect the Debenture
amendments set forth herein.
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b. Amendments
to
Warrants. The parties agree that as of the date hereof, the
exercise price of the Warrants shall be adjusted as follows, and to document
such adjustments, the Company shall issue Amended and Restated Warrants in
the
form attached hereto as Exhibit B :
Warrant
Number
Original Exercise
Price
Adjusted Exercise Price
UCPI-A-1
$0.55 $0.15
UCPI-B-1
$0.65
$0.25
UCPI-C-1
$0.75
$0.35
UCPI-D-1
$0.90
$0.50
Furthermore,
the Company shall issue the following additional Warrants (the “Additional
Warrants”), each of which shall be in the form of the Additional Warrant
attached hereto as Exhibit C:
Warrant
Number
Number of
Shares
Exercise Price
UCPI-A-2
6,786,667
$0.15
UCPI-B-2
3,446,400
$0.25
UCPI-C-2
2,133,714
$0.35
UCPI-D-2
1,244,400
$0.50
3
c. Registration
Statement. Within 20 days from the date hereof the Company
shall file all necessary amendments and supplements to the effective
registration statement on form SB-2 (no. 333-143846) to reflect the amendments
to the Debentures and the change in the exercise price of the Warrants set
forth
above (but not with respect to the additional number of Warrant
Shares).
d. Further
Assurances.
Company and Affiliated Holdings, Inc. shall, from and after the execution of
this Agreement, execute and deliver to YA Global whatever additional documents,
instruments, and agreements that YA Global may require in order to correct
any
document deficiencies, or to vest or perfect the Transaction Documents and
the
collateral granted therein more securely in YA Global and/or to otherwise give
effect to the terms and conditions of this Agreement, and hereby authorize
YA
Global to file any financing statements (including financing statements with a
generic description of the collateral such as “all assets”), and take any other
normal and customary steps, YA Global deems necessary to perfect or evidence
YA
Global’s security interests and liens in any such
collateral. Affiliated Holdings, Inc. shall be added as a signatory
to the Security Agreement.
e. Cross
Default.
Company hereby acknowledges and agrees that any default under this Agreement
shall constitute an Event of Default under each of the Transaction
Documents.
3. RELEASE. In
exchange for the accommodations made
by YA Global herein, Company and Affiliated Holdings, Inc. do hereby,
on behalf of themselves and their
agents,
representatives, attorneys,
assigns, heirs,
subsidiaries, executors and
administrators
(collectively, “Company Parties”) RELEASE AND FOREVER
DISCHARGE
YA Global and
its subsidiaries
and its respective
affiliates,
parents, joint ventures,
officers, directors, shareholders, interest holders, members, managers,
employees, consultants, representatives, successors
and assigns,
heirs, executors and administrators (collectively, “Buyer Parties”) from all
causes of action, suits, debts, claims and demands whatsoever known or unknown,
at law, in equity or otherwise, which the Company Parties ever had,
now
have, or hereafter may have
on or prior to the date
hereof, and any
claims for reasonable attorneys’
fees and costs, and including, without limitation, any claims relating to fees,
penalties, liquidated damages, and indemnification for losses, liabilities
and
expenses. The release contained in this
Section
is effective without
regard
to the legal nature of the claims raised and without regard to whether any
such
claims are based upon tort, equity, or implied or express
contract. It
is expressly understood and agreed
that this release shall operate as a clear and unequivocal waiver by
the Company Parties
of
any such claim
whatsoever.
4. PROVISIONS
OF GENERAL
APPLICATION
a. Effect
of this
Agreement. Except as modified pursuant hereto, no other
changes or modifications to the Transaction Documents are intended or implied
and in all other respects the Transaction Documents are hereby specifically
ratified, restated and confirmed by all parties hereto as of the effective
date
hereof. To the extent of conflict between the terms of this Agreement
and the other Transaction Documents, the terms of this Agreement shall
control. The Transaction Documents and this Agreement shall be read
and construed as one agreement.
b. Governing
Law. This Agreement shall be interpreted according to the laws
of the State of New Jersey and shall inure to the benefit of and be binding
upon
the parties hereto and their respective successors and assigns. Any
notices, demands, consents, other writings or communications permitted or
required by this Agreement shall be given in the manner and to the address
as
set forth in the Transaction Documents.
c. Mutual
Waiver of Jury
Trial. BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX
FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN
EXPERIENCED AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL
LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR
DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE
LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF
THE JUDICIAL SYSTEM AND OF ARBITRATION, THE PARTIES HERETO WAIVE ALL RIGHTS
TO
TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE,
WHETHER ARISING IN CONTRACT, TORT OR OTHERWISE BETWEEN FACTOR AND CLIENT ARISING
OUT OF, CONNECTED WITH, RELATED OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED
BETWEEN THEM IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER FACTORING
DOCUMENTS OR THE TRANSACTIONS RELATED THERETO.
[SIGNATURE
PAGE IMMEDIATELY TO FOLLOW]
4
IN
WITNESS WHEREOF, this
Agreement is executed and delivered as of the day and year first above
written.
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Unicorp,
Inc.
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By:
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Name:
Xxxx X. Xxxxx
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Title:
Chief Financial Officer
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Affiliated
Holdings, Inc.
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By:
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Name:
Xxxx X. Xxxxx
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Title:
Chief Financial Officer
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YA
Global Investments, L.P.
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By:
Yorkville Advisors, LLC
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Its:
Investment Manager
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By:
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Name:
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Title:
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5
SCHEDULE
A
TRANSACTION
DOCUMENTS
Securities
Purchase Agreement dated May 17, 2007 between Company and YA Global.
Secured
Convertible Debenture (no. UCPI-1-3) issued on October 23, 2007 in the original
principal amount of $1,500,000
Secured
Convertible Debenture (no. UCPI-1-2) issued on June 29, 2007 in the original
principal amount of $2,000,000
Secured
Convertible Debenture (no. UCPI-1-1) issued on May 17, 2007 in the original
principal amount of $3,500,000
Warrant
No.UCPI-1-A issued to YA Global on May 17, 2007 to purchase 2,545,000 shares
of
common stock.
Warrant
No.UCPI-1-B issued to YA Global on May 17, 2007 to purchase 2,154,000 shares
of
common stock.
Warrant
No.UCPI-1-C issued to YA Global on May 17, 2007 to purchase 1,867,000 shares
of
common stock.
Warrant
No.UCPI-1-D issued to YA Global on May 17, 2007 to purchase 1,555,500 shares
of
common stock.
Registration
Rights Agreement dated May 17, 2007 between Company and YA Global.
Security
Agreement dated May 17, 2007 among the Company, Affiliated Holdings, Inc.,
and
YA Global.
Mortgage,
Assignment of Production, Security Agreement, Fixture Filing and Financing
Statement granted by the Company to YA Global as of May 17, 2007
Deed
of
Trust, Mortgage, Assignment, Security Agreement, Fixture Filing and Financing
Statement granted by the Company to YA Global as of May 17, 2007
Irrevocable
Transfer Agent Instructions dated May 17, 2007 among Company, Xxxxx Xxxxxxxx,
OTC Stock Transfer Co., and YA Global.
EXHIBIT
A
FORM
OF AMENDED AND RESTATED
CONVERTIBLE DEBENTURES
EXHIBIT
B
FORM
OF AMENDED AND RESTATED
WARRANTS
EXHIBIT C
FORM
OF ADDITIONAL
WARRANTS
