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Exhibit 10.1
CONVERTIBLE NOTE REDEMPTION OPTION AGREEMENT
This CONVERTIBLE NOTE REDEMPTION OPTION AGREEMENT (the "AGREEMENT")
dated as of February 27, 2001 (the "EFFECTIVE DATE") is entered into by and
among E Com Ventures, Inc., a Florida corporation, with headquarters located at
00000 X.X. 000xx Xxxx, Xxxxx, Xxxxxxx 00000 (the "COMPANY"), and the undersigned
(on the signature pages hereto) designated as "Holders of Convertible Notes"
(each individually, a "HOLDER" and collectively, the "HOLDERS").
WHEREAS:
A. Prior to the date hereof, the Company has issued to the Holders the
Company's Series A Convertible Notes on April 28, 1999, Series B Convertible
Notes on July 8, 1999, Series C Convertible Notes on March 9, 2000 and Series D
Convertible Notes on March 27, 2000 (collectively, the "NOTES"); and
B. The Company desires to have the option to redeem the Notes, and the
Holders desire to allow the Company to have the option to redeem the Notes, upon
the terms and conditions stated in this Agreement.
NOW THEREFORE, in consideration of the foregoing, of the mutual
covenants and agreements contained herein and of other good and valuable
consideration, the receipt, adequacy and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
1. REDEMPTION OF NOTES
a. SCHEDULED REDEMPTION. In the event that the Company elects
to redeem a portion of the Notes in accordance with Section 1(b) below,
on or prior to each Redemption Date (as set forth in SCHEDULE 1
attached hereto) the Company shall pay to the Holders, in aggregate,
the Redemption Amount corresponding to such Redemption Date as set
forth in SCHEDULE 1 and any Redemption Amount corresponding to any
previous Redemption Date (as set forth on SCHEDULE 1) on which the
Company failed to pay the applicable Redemption Amount or on which the
Company did not previously elect to redeem. If the Company has elected
to redeem a portion of the Notes in accordance with Section 1(b) below,
on the applicable Redemption Date, each Holder shall receive from the
Company that Redemption Amount designated for such Holder on SCHEDULE 1
for such applicable Redemption Date and any Redemption Amount
corresponding to any previous Redemption Date (as set forth on SCHEDULE
1) on which the Company failed to pay the applicable Redemption Amount
or on which the Company did not previously elect to redeem. (SCHEDULE 2
sets forth the components of each Holder's portion of the Redemption
Amount on the applicable Redemption Date as applied to all Notes held
by each Holder.) Each Holder's portion of each Redemption Amount on
each Redemption Date shall consist of (x) the principal
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redeemed for each of such Holder's Notes (as set forth on SCHEDULE 2)
on such Redemption Date and (y) the additional amount for each of such
Holder's Notes (as set forth on SCHEDULE 2) as of such Redemption Date
determined by multiplying twenty percent (20%) by the principal
redeemed for each of such Holder's Notes (as set forth on SCHEDULE 2)
on such Redemption Date. Interest and, if applicable, Default Interest
(as defined in each Note) on each Note shall continue to be calculated
and paid in accordance with each such Note.
b. MECHANICS OF REDEMPTION.
i. NOTICE. In the event that the Company elects to
redeem a portion of the Notes corresponding to such Redemption Date and
any portion of Notes corresponding to any previous Redemption Date in
which the applicable Redemption Amount was not paid by the Company to
the Holders, the Company shall deliver written notice, in the form
attached hereto as EXHIBIT A (a "NOTICE OF REDEMPTION"), via facsimile
to each Holder no later than the fifth (5th) Business Day (defined
below) prior to the applicable Redemption Date. Each Notice of
Redemption sent by the Company to each Holder shall indicate (i) the
aggregate Redemption Amounts to be paid by the Company to the Holders,
(ii) each Holder's pro rata share of each Redemption Amount paid on
such Redemption Date and (iii) for each series of such Holder's Notes
(A) the principal balance of Notes being redeemed, (B) the additional
amount being paid and (C) the principal balance remaining after such
payment. In the event that the Company fails to provide each Holder
with the requisite written notice (in the form of EXHIBIT A) prior to
or on the fifth (5th) Business Day prior to any Redemption Date, such
failure shall be deemed to be constructive notice by the Company to all
Holders that the Company has elected not to redeem the portion of the
Notes corresponding to such Redemption Date (each, a "NOTICE FAILURE").
ii. PAYMENT OF REDEMPTION AMOUNT. On or prior to the
applicable Redemption Date, if the Company has properly elected to
redeem a portion of the Notes in accordance with Section 1(b) above,
the Company shall pay to each Holder such Holder's portion of the
applicable Redemption Amount (as set forth on SCHEDULE 1) and any
Redemption Amount corresponding to any previous Redemption Date (as set
forth on SCHEDULE 1) on which the Company failed to pay the applicable
Redemption Amount or on which the Company did not previously elect to
redeem. If the Company has properly elected to redeem a portion of the
Notes and the Company fails to make full payment of the aggregate
Redemption Amounts payable on the applicable Redemption Date, then (i)
the Company shall pay to the Holders, on a pro rata basis (determined
by dividing the outstanding principal balance of all Notes held by such
Holder by the outstanding principal balance of all Notes held by all
Holders), on the Redemption Date any funds that the Company reasonably
determines are available, (ii) the Company shall use its best efforts
to promptly pay to the Holders any due but unpaid Redemption Amount and
(iii) the provisions of Section 1(c) below shall be applicable.
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iii. DISPUTES; MISCELLANEOUS. In the event of a
dispute as to any determination or calculation described in this
Agreement, the applicable Holders and the Company shall use their best
efforts to resolve such dispute within three (3) Business Days. If such
Holders and the Company are unable to resolve such dispute within three
(3) Business Days, then the Company shall within two (2) Business Days
submit each of their calculations to an independent, reputable
accounting firm selected by such Holders and consented to by the
Company (such consent not to be unreasonably withheld). The Company
shall use its reasonable best efforts to cause the accountant to
perform the determinations or calculations and notify the Company and
the Holders of the results no later than the fifth (5th) Business Day
after the date it receives the disputed determinations or calculations.
Such accountant's determination or calculation shall be binding upon
such parties absent manifest error. The Company shall be liable for all
costs and expenses related to such determination or calculation if (A)
the absolute value of the difference between (1) the accountant's
determination or calculation and (2) the Company's determination or
calculation is equal to or greater than (B) the absolute value of the
difference between (1) the accountant's determination or calculation
and (2) the applicable Holder's determination or calculation;
otherwise, such costs and expenses shall be paid by such Holder.
iv. GENERAL PAYMENT PROVISIONS. All payments made by
the Company under this Agreement shall be made in lawful money of the
United States of America by wire transfer of immediately available
funds to such accounts as the Holders may from time to time designate
by written notice to the Company in accordance with the provisions of
the applicable Notes. Whenever any amount expressed to be due by the
terms of this Agreement is due on any day which is not a Business Day,
the same shall instead be due on the next succeeding day which is a
Business Day. For purposes of this Agreement, "BUSINESS DAY" shall mean
any day in which the Nasdaq National Market is open for business.
c. REDEMPTION FAILURE. In the event that (i) the Company fails
to make full payment of any Redemption Amount by the applicable
Redemption Date or (ii) the Company materially breaches any
representation, warranty, covenant or other term or condition of this
Agreement or any Note, including without limitation the failure to pay
fully when due any accrued but unpaid interest on any Note or (iii) a
Notice Failure has occurred (each, a "REDEMPTION FAILURE"), then during
the period commencing on the Business Day on which such Redemption
Failure occurred and ending on the Business Day on which the Company
fully cures such Redemption Failure (and for purposes of this Agreement
in the event that the Company has caused a Notice Failure, the Company
may only cure such Notice Failure by providing proper written notice
(in the form of EXHIBIT A) to each Holder for a subsequent Redemption
Date pursuant to the requirements set forth in Section 1(b)) (a
"REDEMPTION FAILURE PERIOD") the additional conversion restrictions and
conversion limitations described in Section 3(b)(i) below shall not be
applicable to any of the Holders or Notes and shall be of no force and
effect. Notwithstanding anything herein to the contrary, a Redemption
Failure (other than a violation of any Note which constitutes an Event
of Default, as such term is defined in the Notes) does not constitute
an Event of Default, as such term is defined in the Notes.
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2. REPRESENTATIONS AND WARRANTIES.
a. ORGANIZATION AND QUALIFICATION. The Company is a
corporation duly organized and validly existing in good standing under
the laws of the jurisdiction in which it is incorporated, and has the
requisite corporate power and authorization to own its properties and
to carry on its business as now being conducted.
b. AUTHORIZATION; ENFORCEMENT; VALIDITY. (i) The Company has
the requisite corporate power and authority to enter into and perform
this Agreement, (ii) the execution and delivery of this Agreement by
the Company, and the consummation by the Company of the transactions
contemplated hereby, have been duly authorized by the Company's Board
of Directors and, with the exception of GMAC Commercial Credit LLC, no
further consent or authorization is required by the Company, its Board
of Directors or its shareholders, (iii) this Agreement has been duly
executed and delivered by the Company, and (iv) this Agreement
constitutes the valid and binding obligations of the Company
enforceable against the Company in accordance with its terms, except as
such enforceability may be limited by general principles of equity or
applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally, the
enforcement of creditors' rights and remedies.
c. NO CONFLICTS. The execution, delivery and performance of
this Agreement by the Company, the performance by the Company of its
obligations under this Agreement and the consummation by the Company of
the transactions contemplated hereby will not (i) result in a violation
of the Company's Articles of Incorporation, any outstanding series of
notes or preferred stock of the Company or the Company's By-laws or
(ii) conflict with, or constitute a default (or an event which with
notice or lapse of time or both would become a default) under, or give
to others any rights of termination, amendment, acceleration or
cancellation of, any material agreement, indenture or instrument to
which the Company is a party, or result in a violation of any law,
rule, regulation, order, judgment or decree (including federal and
state securities laws) applicable to the Company or by which any
property or asset of the Company is bound or affected, except in the
case of (ii) above where such conflict or default would not have a
Material Adverse Effect. As used in this Agreement "MATERIAL ADVERSE
EFFECT" means any material adverse effect on the business, properties,
assets, operations, results of operations or financial condition of the
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Company, taken as a whole. The Company is not in violation of any term
of or in default under its Articles of Incorporation, any outstanding
series of notes or preferred stock of the Company or By-laws. The
Company is not in violation of any term of or in default under any
contract, agreement, mortgage, indebtedness, indenture, instrument,
judgment, decree or order or any statute, rule or regulation applicable
to the Company, except for possible violations or defaults which would
not have a Material Adverse Effect. The business of the Company is not
being conducted, and shall not be conducted, in violation of any law,
ordinance, regulation of any governmental entity, except for possible
violations of the sections for which either individually or in the
aggregate would not have a Material Adverse Effect. Except as
specifically contemplated by this Agreement and as required under the
Securities Act of 1933, as amended, the Company is not required to
obtain any consent, authorization or order of, or make any filing or
registration with, any court or governmental agency or any regulatory
or self-regulatory agency in order for it to execute, deliver or
perform any of its obligations under or contemplated by this Agreement.
d. NO UNDISCLOSED EVENTS, LIABILITIES, DEVELOPMENTS OR
CIRCUMSTANCES. No event, liability, development or circumstance has
occurred or exists, or is contemplated to occur, with respect to the
Company or its business, properties, prospects, operations or financial
condition, that would be required to be disclosed by the Company under
applicable federal and state securities laws on a registration
statement filed with the Securities and Exchange Commission relating to
an issuance and sale by the Company of its common stock and which has
not publicly been announced.
3. COVENANTS.
a. COMPANY COVENANTS.
i. FILING OF FORM 8-K. Within seven (7) calendar days
following the Effective Date, the Company shall file a Form 8-K with
the United States Securities and Exchange Commission describing the
terms of the transactions contemplated by this Agreement in the form
required by the Securities Exchange Act of 1934 Act, as amended.
ii. BEST EFFORTS. The Company shall use its best
efforts timely to satisfy each of the conditions to be satisfied by it
as provided in Sections 4 of this Agreement.
x. XXXXXX COVENANTS.
i. ADDITIONAL CONVERSION LIMITATION. In addition to
any conversion limitations or conversion restrictions set forth in each
of the Holder's Notes, effective as of and from the Business Day
immediately following the Effective Date up to and through the last
Redemption Date under this Agreement (as set forth on SCHEDULE 1), each
Holder agrees, unless such Holder has received the prior consent of the
Company, not to convert any part of the outstanding and unpaid
principal balance of such Holder's Notes into fully paid and
nonassessable shares of Company common stock; PROVIDED, HOWEVER, that
during any Redemption Failure Period, the additional conversion
limitations described in this Section 3(b)(i) shall not be applicable
to any of the Holders or Notes and, during such Redemption Failure
Period, the Holders may convert their Notes in accordance with the
terms and provisions of such Notes (as amended by any written
contractual arrangements between the Company and the applicable Holder)
without regard to any conversion limitation described in this Section
3(b)(i).
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4. CONDITIONS TO HOLDER'S OBLIGATIONS.
a. The obligations of each Holder as described in this
Agreement are subject to the satisfaction, at or before the Effective
Date, of each of the following conditions, provided that these
conditions are for each Holder's sole benefit and may be waived by such
Holder at any time in its sole discretion by providing the Company with
prior written notice thereof:
i. The Company shall have executed this Agreement
and delivered the same to Holders' nominee;
ii. The representations and warranties of the Company
shall be true and correct as of the date when made and as of the
Effective Date as though made at that time and the Company shall have
performed, satisfied and complied with the covenants, and agreements
required by this Agreement to be performed, satisfied or complied with
by the Company at or prior to the Effective Date;
iii. On the Effective Date, the Company shall have
paid the first Redemption Amount to the Holders in the manner
satisfactory to the Holders;
iv. On the Effective Date, the Company shall
reimburse the Holders for the balance of the Holders' costs and
expenses, including without limitation attorneys' fees and expenses (in
an aggregate amount not to exceed $25,000 of which $15,000 has
previously been reimbursed by the Company) incurred by the Holders
concerning the due diligence review of the contemplated transactions
and the Company, and the negotiation and preparation of documentation
and the consummation of the transactions contemplated thereby; and
v. The Company shall have delivered to the Holders'
nominee such other documents relating to the transactions contemplated
by this Agreement as the Holders may reasonably request.
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5. MISCELLANEOUS.
a. NO LIMITATION ON OTHER RIGHTS. Except as set forth in
Section 3(b)(i) above, the Holders do not waive any other rights or
remedies available to the Holders under the Notes. Interest on the
unpaid principal balance of the Notes and Default Interest, if any,
shall accrue and shall be paid in accordance with the terms and
provisions of the Notes. (The parties acknowledge, assuming that the
Company timely pays all Redemption Amounts set forth on SCHEDULE 1 to
the Holders, that SCHEDULE 3 sets forth the interest payments and
interest payment dates required to be paid by the Company to the
Holders pursuant to the applicable Notes.) The rights and remedies
provided in this Agreement shall be cumulative and in addition to all
other rights and remedies available under the Notes, at law or in
equity, and no remedy contained herein shall be deemed a waiver of
compliance with the provisions giving rise to such remedy and nothing
herein shall limit a Holder's right to pursue actual damages for any
failure by the Company to comply with the terms of this Agreement.
b. REORGANIZATION, RECLASSIFICATION, CONSOLIDATION, MERGER OR
SALE. Any recapitalization, reorganization, reclassification, spin-off,
distribution of securities of any Company subsidiary, consolidation,
merger, acquisition, business combination, purchase, tender or exchange
offer made to and accepted by the holders of more than the 50% of the
outstanding shares of the Company's common stock, sale of all or
substantially all of the Company's assets to another person or entity,
or any other transaction which is effected in such a way that holders
of Company common stock are entitled to receive (either directly or
upon subsequent liquidation) stock, securities or assets with respect
to or in exchange for Company common stock is referred to herein as
"ORGANIC CHANGE." Prior to the consummation of any Organic Change
following which the Company is not a surviving entity, the Company will
secure from the person or entity purchasing such assets or Company
common stock or the successor resulting from such Organic Change a
written agreement (in form and substance satisfactory to Holders of a
majority of the outstanding principal balance of the Notes) to assume
all obligations and duties of the Company contained in this Agreement.
c. INDEMNIFICATION. In consideration of each Holder's
execution and delivery of this Agreement and in addition to all of the
Company's other obligations under this Agreement, the Company shall
defend, protect, indemnify and hold harmless each Holder and all of
their shareholders, officers, directors, employees and direct or
indirect investors and any of the foregoing person's agents or other
representatives (including, without limitation, those retained in
connection with the transactions contemplated by this Agreement)
(collectively, the "INDEMNITEES") from and against
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any and all actions, causes of action, suits, claims, losses, costs,
penalties, fees, liabilities and damages, and expenses in connection
therewith (irrespective of whether any such Indemnitee is a party to
the action for which indemnification hereunder is sought), and
including reasonable attorneys' fees and disbursements (the
"INDEMNIFIED LIABILITIES"), incurred by any Indemnitee as a result of,
or arising out of, or relating to (a) any material misrepresentation or
breach of any representation or warranty made by the Company in this
Agreement or any other certificate, instrument or document contemplated
hereby or thereby or (b) any material breach of any covenant, agreement
or obligation of the Company contained in this Agreement or any other
certificate, instrument or document contemplated hereby or thereby. To
the extent that the foregoing undertaking by the Company may be
unenforceable for any reason, the Company shall make the maximum
contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law.
d. PAYMENT OF COLLECTION, ENFORCEMENT AND OTHER COSTS. If (i)
this Agreement and applicable Notes are placed in the hands of an
attorney for collection or enforcement or is collected or enforced
through any legal proceeding, (ii) an attorney is retained to represent
a Holder in any bankruptcy, reorganization, receivership or other
proceedings affecting creditors' rights and involving a claim under
this Agreement, or (iii) an attorney is retained to represent a Holder
in connection with any proceeding against the Holder for breach of
fiduciary duty in connection with this Agreement, then the Company
shall pay to the Holder all reasonable attorneys' fees, costs and
expenses incurred in connection therewith, in addition to all other
amounts due hereunder.
e. RESTRICTION ON REDEMPTION AND DIVIDENDS. Until all of the
Company's payment obligations have been fully satisfied as provided
herein, the Company shall not, directly or indirectly, redeem, or
declare or pay any dividend (whether in cash, stock or other property
or in connection with any spin off) or distribution on, its capital
stock without the prior express written consent of Holders of not less
than two-thirds (2/3) of the outstanding principal balance of the
Notes. In the event the Holders consent to such redemption, dividend or
distribution, then the Holders on the record date for such redemption,
dividend or distribution shall be entitled to receive on the date of
redemption, payment or distribution of such dividend or other
distribution the amount of cash or property equal to the cash or
property which would be received by the Holders in the event the
Holders owned the number of shares of Company common stock into which
the Notes would be convertible pursuant to the terms of the Notes
immediately prior to such record date without regard to any conversion
limitations or conversion restrictions included in this Agreement or
the applicable Notes.
f. NO AMENDMENT OF NOTES. This Agreement shall not be
construed in any manner as an amendment or modification to the terms
and provisions of the Notes.
g. INCORPORATION OF RECITALS. The recitals portion of this
Agreement is expressly incorporated into and made a part of this
Agreement.
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h. GOVERNING LAW. This Agreement shall be construed and
enforced in accordance with, and all questions concerning the
construction, validity, interpretation and performance of this
Agreement shall be governed by, the laws of the State of Florida,
without giving effect to provisions thereof regarding conflict of laws.
Each party hereby irrevocably submits to the non-exclusive jurisdiction
of the state and federal courts sitting in the City of Miami, for the
adjudication of any dispute hereunder or in connection herewith or with
any transaction contemplated hereby or discussed herein, and hereby
irrevocably waives, and agrees not to assert in any suit, action or
proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is
brought in an inconvenient forum or that the venue of such suit, action
or proceeding is improper. Each party hereby irrevocably waives
personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof to such party
at the address for such notices to it under this Agreement and agrees
that such service shall constitute good and sufficient service of
process and notice thereof. Nothing contained herein shall be deemed to
limit in any way any right to serve process in any manner permitted by
law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND
AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE
HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR
ANY TRANSACTION CONTEMPLATED HEREBY.
i. SPECIFIC SHALL NOT LIMIT GENERAL; CONSTRUCTION. No specific
provision contained in this Agreement shall limit or modify any more
general provision contained herein. This Agreement shall be deemed to
be jointly drafted by the Company and all Holders and shall not be
construed against any person as the drafter hereof.
j. FAILURE OR INDULGENCE NOT WAIVER. No failure or delay on
the part of any Holder in the exercise of any power, right or privilege
hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other right, power or privilege.
k. COUNTERPARTS. This Agreement may be executed in two or more
identical counterparts, all of which shall be considered one and the
same agreement and shall become effective when counterparts have been
signed by each party and delivered to the other party; provided that a
facsimile signature shall be considered due execution and shall be
binding upon the signatory thereto with the same force and effect as if
the signature were an original, not a facsimile signature.
l. HEADINGS. The headings of this Agreement are for
convenience of reference and shall not form part of, or affect the
interpretation of, this Agreement.
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m. SEVERABILITY. If any provision of this Agreement shall be
nvalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement in that jurisdiction or the validity or
enforceability of any provision of this Agreement in any other
jurisdiction.
n. ENTIRE AGREEMENT; AMENDMENTS. This Agreement supersedes all
other prior oral agreements between the Holders, the Company, their
affiliates and persons acting on their behalf with respect to the
matters discussed herein, and this Agreement and the instruments
referenced herein contain the entire understanding of the parties with
respect to the matters covered herein and therein and, except as
specifically set forth herein or therein, neither the Company nor any
Holder makes any representation, warranty, covenant or undertaking with
respect to such matters. No provision of this Agreement may be amended
other than by an instrument in writing signed by the Company and
Holders of at least two-thirds (2/3) of the outstanding principal
balance of the Notes, and no provision hereof may be waived other than
by an instrument in writing signed by the party against whom
enforcement is sought.
o. NOTICES. Any notices, consents, waivers or other
communications required or permitted to be given under the terms of
this Agreement must be in writing and will be deemed to have been
delivered: (i) upon receipt, when delivered personally; (ii) upon
receipt, when sent by facsimile (provided confirmation of transmission
is mechanically or electronically generated and kept on file by the
sending party); or (iii) one (1) Business Day after deposit with a
nationally recognized overnight delivery service, in each case properly
addressed to the party to receive the same. The addresses and facsimile
numbers for such communications shall be the same as the information
included in the transaction documents concerning the Notes.
p. SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the parties and their respective
successors and assigns, including any purchasers of the Notes. The
Company shall not assign this Agreement or any rights or obligations
hereunder without the prior written consent of Holders of at least
two-thirds (2/3) of the outstanding principal balance of the Notes. A
Holder may assign some or all of its rights hereunder without the
consent of the Company, provided, however, that any such assignment
shall not release such Holder from its obligations hereunder unless
such obligations are assumed by such assignee and the Company has
consented to such assignment and assumption.
q. NO THIRD PARTY BENEFICIARIES. This Agreement is intended
for the benefit of the parties hereto and their respective permitted
successors and assigns, and is not for the benefit of, nor may any
provision hereof be enforced by, any other person.
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r. SURVIVAL. The agreements and covenants set forth in
Sections 1, 3 and 5 shall survive the Closing. Each Holder shall be
responsible only for its own representations, warranties, agreements
and covenants hereunder.
s. FURTHER ASSURANCES. Each party shall do and perform, or
cause to be done and performed, all such further acts and things, and
shall execute and deliver all such other agreements, certificates,
instruments and documents, as the other party may reasonably request in
order to carry out the intent and accomplish the purposes of this
Agreement and the consummation of the transactions contemplated hereby.
t. PAYMENT SET ASIDE. To the extent that the Company makes a
payment or payments to the Holders hereunder, and such payment or
payments or the proceeds of such enforcement or exercise or any part
thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside, recovered from, disgorged by or are required
to be refunded, repaid or otherwise restored to the Company, a trustee,
receiver or any other person under any law (including, without
limitation, any bankruptcy law, state or federal law, common law or
equitable cause of action), then to the extent of any such restoration
the obligation or part thereof originally intended to be satisfied
shall be revived and continued in full force and effect as if such
payment had not been made or such enforcement or setoff had not
occurred.
u. TERMINATION. Except for the terms and provisions of
Sections 1, 5(c) and 5(d), the terms and provisions of this Agreement
shall terminate on the first (1st) Business Day following the last
Redemption Date under this Agreement (as set forth on SCHEDULE 1).
***SIGNATURE PAGES FOLLOW***
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IN WITNESS WHEREOF, the Holders and the Company have caused this
Convertible Note Redemption Option Agreement to be duly executed as of the
Effective Date.
COMPANY: HOLDERS OF CONVERTIBLE NOTES:
E COM VENTURES, INC. SERIES A CONVERTIBLE NOTE HOLDERS:
By: /s/ Xxxx Xxxxxx EP OPPORTUNITY FUND, L.L.C.
--------------------------------
Name: Xxxx Xxxxxx
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Title: Chief Executive Officer By: /s/ Xxxxxxx Xxxxxxxxx
----------------------------- -------------------------------------
Name: Xxxxxxx Xxxxxxxxx
-----------------------------------
Title: Manager of Xxxxxxxxx Partners,
LLC, which is Manager of EP
Opportunity Fund, L.L.C.
----------------------------------
EP OPPORTUNITY FUND INTERNATIONAL, LTD.
By: /s/ Xxxxxxx Xxxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxxx
----------------------------------
Title: Manager of Xxxxxxxxx Partners,
LLC, which is Investment
Manager of EP Opportunity Fund
International, Ltd.
---------------------------------
***SIGNATURE PAGE CONTINUES***
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SERIES B CONVERTIBLE NOTE HOLDERS:
CRANSHIRE CAPITAL, L.P.
By: Downsview Capital, Inc.,
the General Partner
By: /s/ Xxxxxxxx X. Xxxxx
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Name: Xxxxxxxx X. Xxxxx
Title: President
S. XXXXXX PRODUCTIONS, LLC
By: /s/ Xxxxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxxxx X. Xxxxx
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Title: President
---------------------------------
THE DOTCOM FUND, LLC
By: /s/ Xxxx Xxxx
------------------------------------
Name: Xxxx Xxxx
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Title: Managing Member
---------------------------------
EP OPPORTUNITY FUND, L.L.C.
By: /s/ Xxxxxxx Xxxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxxx
----------------------------------
Title: Manager of Xxxxxxxxx Partners,
LLC, which is the Manager of EP
Opportunity Fund, L.L.C.
---------------------------------
EP OPPORTUNITY FUND INTERNATIONAL, LTD.
By: /s/ Xxxxxxx Xxxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxxx
----------------------------------
Title: Manager of Xxxxxxxxx Partners,
LLC, which is the Investment
Manager of EP Opportunity Fund
International, Ltd.
---------------------------------
XX.XXX FUND, L.L.C.
By: /s/ Xxxxxxx Xxxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxxx
----------------------------------
Title: Manager of Xxxxxxxxx Partners,
LLC, which is Manager of XX.xxx
Fund, L.L.C.
---------------------------------
***SIGNATURE PAGE CONTINUES***
13
14
SERIES C CONVERTIBLE NOTE HOLDERS:
CRANSHIRE CAPITAL, L.P.
By: Downsview Capital, Inc.,
the General Partner
By: /s/ Xxxxxxxx X. Xxxxx
---------------------------
Name: Xxxxxxxx X. Xxxxx
Title: President
S. XXXXXX PRODUCTIONS, LLC
By: /s/ Xxxxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxxxx X. Xxxxx
----------------------------------
Title: President
---------------------------------
THE DOTCOM FUND, LLC
By: /s/ Xxxx Xxxx
------------------------------------
Name: Xxxx Xxxx
----------------------------------
Title: Managing Member
---------------------------------
***SIGNATURE PAGE CONTINUES***
14
15
SERIES D CONVERTIBLE NOTE HOLDERS:
CRANSHIRE CAPITAL, L.P.
By: Downsview Capital, Inc.,
the General Partner
By: /s/ Xxxxxxxx X. Xxxxx
---------------------------
Name: Xxxxxxxx X. Xxxxx
Title: President
EURAM CAP STRAT. "A" FUND LIMITED
By: /s/ Xxxxxxxx X. Xxxxx
-----------------------------------
Name: Xxxxxxxx X. Xxxxx
----------------------------------
Title: President of JMJ Capital, Inc.,
the Investment Manager
---------------------------------
THE DOTCOM FUND, LLC
By: /s/ Xxxx Xxxx
------------------------------------
Name: Xxxx Xxxx
----------------------------------
Title: Managing Member
---------------------------------
***CONCLUSION OF SIGNATURE PAGES***
15
