EXHIBIT 10.65
LETTER AGREEMENT
The Xxxxx X. Xxxxxxx Revocable Trust
Dated June 15, 1993 June 14, 2001
Attn: Xxxxx X. Xxxxxxx, Trustee
11331 South Erie
Xxxxx, XX 00000
Dear Xx. Xxxxxxx:
This Letter Agreement will reflect our understanding that you have
agreed to loan Heartsoft, Inc. (the "Company" or "Heartsoft") an additional
$50,000 (the "Additional Loan") by amending and restating that certain
Convertible Promissory Note by and between the Company and The Xxxxx X.
Xxxxxxx Revocable Trust Dated June 15, 1993 ("Xxxxxxx") dated January 24, 2001
in principal amount of $250,000 ("Convertible Note") and the related Security
Agreement by and between the Company and Xxxxxxx of even date ("Security
Agreement"). In order to induce Xxxxxxx to make the Additional Loan, subject
to the terms of this Letter Agreement, the Company agrees to issue to Xxxxxxx
100,000 shares of common stock (the "Additional Shares"), par value $0.0005
per share, of the Company (the "Issuance"), as provided below.
The Additional Loan and the Issuance will be made in accordance with
the following terms and conditions:
1. Xxxxxxx shall delivered to the Company a check in the amount
of $50,000. On receipt in full of the foregoing, the Company shall issue and
deliver a certificate representing the Additional Shares to Xxxxxxx.
2. Upon and simultaneously with the deliveries described in
paragraph 1 above, the Convertible Note and the Security Agreement shall be
deemed to be amended and restated, without further action of the parties, in
the forms attached to this Letter Agreement.
3. To induce the Company to amend and restate the Convertible
Note and the Security Agreement and to issue the Additional Shares, Xxxxxxx
hereby represents and warrants to the Company that:
(a) this Agreement, when executed and delivered by Xxxxxxx,
xxxx constitute a legal, valid and binding obligation enforceable
against Xxxxxxx in accordance with its terms;
(b) the Additional Shares are being acquired by Xxxxxxx for
investment purposes only, for the account of Xxxxxxx and not with the
view to any distribution thereof;
(c) Xxxxxxx is an "accredited investor" as that term is
defined in the Act; and
(d) Xxxxxxx is aware that the Additional Shares have not been
registered under the Securities Act of 1933 (the "Act") and its ability
to sell or dispose of the Additional Shares will be restricted. Xxxxxxx
is subscribing for the Additional Shares with full knowledge of such
limitation. Xxxxxxx acknowledges that it is aware that the Additional
Shares may not be resold or offered by it for sale in the absence of:
(i) an effective registration statement under the Act covering the
Additional Shares; or (ii) an opinion of counsel satisfactory to the
Company that registration under the Act is not necessary. Xxxxxxx
consents to the placing of a restrictive legend on the Additional
Shares indicating that the Additional Shares have not been registered
under the Act, and Xxxxxxx understands that the Company will notify its
transfer agent that the Additional Shares are so restricted.
4. Xxxxxxx acknowledges that:
(a) Xxxxxxx has been provided and has read the following
documents:
(i) Annual Reports on Form 10-KSB dated July 14, 2000
and September 28, 2000, containing audited financial
statements for the fiscal years ending March 31, 2000 and June
30, 2000;
(ii) Quarterly Report on Form 10-QSB dated November
14, 2000, containing unaudited interim financial statements
for the period ending September 30, 2000;
(iii) Quarterly Report on Form 10-QSB dated February
14, 2001 containing unaudited interim financial statements for
the period ending December 31, 2000; and
(iv) Quarterly Report on Form 10-QSB dated May 15,
2001 containing unaudited interim financial statements for the
period ending March 31, 2001.
(b) Xxxxxxx has been provided opportunities to ask questions
of representatives of the Company regarding the risks and merits of his
purchase hereunder and to obtain any additional information necessary
to verify the accuracy of the information contained in the
above-mentioned documents and to obtain non-confidential public
information about the Company, its operations and prospects from the
time of such documents through the date hereof. Upon the basis of
Xxxxxxx reading the above mentioned documents and Xxxxxxx'x discussion
with representatives of the Company, Xxxxxxx possesses sufficient
information to understand the risk and merits associated with his
purchase hereunder and to verify the accuracy of information received;
provided,
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however, that the foregoing shall not in any way waive, prejudice or
otherwise adversely affect Xxxxxxx'x right to rely on the Company's
representations and warranties contained herein or otherwise given in
connection with the purchase of the Convertible Note and the Additional
Shares.
5. To induce Xxxxxxx to enter into this Agreement and to amend and
restate the Convertible Note and the Security Agreement and acquire the
Additional Shares, the Company hereby represents and warrants to Xxxxxxx as
follows:
(a) The Company is a corporation validly existing and in good
standing under the laws of the State of Delaware and has the requisite
power and authority to own or lease its properties and to carry on its
business as it is now being conducted. The Company has the requisite
power and authority to enter into this Agreement and to perform its
obligations under this Agreement.
(b) The Additional Shares, when issued and delivered pursuant
to terms of this Agreement, will be duly authorized, validly issued,
fully paid and nonassessable.
(c) This Agreement and the issuance of the Additional Shares
contemplated hereby have been duly authorized by all necessary action
on behalf of the Company. This Agreement has been duly executed and
delivered by authorized officers of the Company, is a valid and binding
agreement on the part of the Company and is enforceable against the
Company in accordance with its terms. All actions necessary to the
authorization, issuance and delivery of the Additional Shares as
contemplated by this Agreement have been taken by the Company.
6. The Company agrees to take all necessary action to cause the
issuance of the Additional Shares to Xxxxxxx, including the issuance of
appropriate instructions to its transfer agent.
7. Xxxxxxx and the Company agree that each will execute such other
documents as may be necessary or desirable in connection with the transactions
contemplated hereby.
8.
(a) This Agreement shall be governed by and construed in
accordance with the laws of the State of Oklahoma, without regard to
the conflicts of laws principles thereunder.
(b) Any notice required or permitted to be given under this
Agreement shall be in writing and shall be deemed to have been duly
given when actually received or when sent by cable, telegraph, or telex
(and confirmed by first class mail, postage prepaid) to the addresses
set forth below or to such other address or addresses the parties may
designate by similar notice.
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If to the Company: Heartsoft, Inc.
0000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxx Xxxxx, XX 00000
Attention: Xxxxxxxx Xxxxx
If to Xxxxxxx: The Xxxxx X. Xxxxxxx Revocable Trust
dated June 15, 1993
Attn: Xxxxx X. Xxxxxxx, Trustee
With a Copy to: Del X. Xxxxxxxxx
Hall, Estill, Hardwick, Gable, Golden & Xxxxxx
(c) Each party bears the cost of expenses and attorney fees in
connection with this Letter Agreement.
(d) This Agreement may be executed in any number of
counterparts, each signed by different persons and all of said
counterparts together shall constitute one and the same instrument, and
such instrument shall be deemed to have been made, executed and
delivered on the date first hereinabove written, irrespective of the
time or times when the same or any counterparts thereof actually may
have been executed and delivered a counterpart thereof to the Company
and Xxxxxxx.
(e) This Agreement, the Letter Agreement by and between the
Company and Xxxxxxx dated January 24, 2001, the Amended and Restated
Convertible Promissory Note by and between the Company and Xxxxxxx
dated as of the date hereof, the Amended and Restated Security
Agreement by and between the Company and Xxxxxxx dated as of the date
hereof and the exhibits thereto contain the entire agreement of the
parties hereto and may not be modified, altered or changed in any
manner whatsoever, except by a written agreement signed by the parties
hereto.
HEARTSOFT, INC.
By: /s/ Xxxxxxxx Xxxxx
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Xxxxxxxx Xxxxx, Chairman and CEO
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ACCEPTED AND AGREED TO:
THE XXXXX X. XXXXXXX REVOCABLE
TRUST DATED JUNE 15, 1993
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx, Trustee
Employer Identification No.
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Date: June 14, 2001
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