Exhibit 28
CONVERTIBLE DEBENTURE PURCHASE AGREEMENT, dated as of January 22,
1998 (this "AGREEMENT"), among Fix-Corp International, Inc., a Delaware
corporation (the "COMPANY"), JNC Opportunity Fund Ltd., a corporation
organized under the laws of the Cayman Islands ("JNC"), and Diversified
Strategies Fund, L.P., an Illinois limited partnership ("DSF"). Each of JNC
and DSF is a "PURCHASER" and, collectively JNC and DSF are the "PURCHASERS."
WHEREAS, subject to the terms and conditions set forth in this
Agreement, the Company desires to issue and sell to the Purchasers and the
Purchasers severally and not jointly desire to purchase an aggregate
principal amount of $2,500,000 of the Company's 4% Convertible Debentures,
due January 22, 2001 (the "DEBENTURES"), which are convertible into shares of
the Company's common stock, par value $.001 per share (the "COMMON STOCK").
IN CONSIDERATION of the mutual covenants and agreements set forth
herein and for good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties agree as follows:
ARTICLE I
PURCHASE AND SALE OF DEBENTURES; CLOSING
1.1 THE CLOSING.
(a) THE CLOSING. (i) Subject to the terms and conditions
set forth in this Agreement, the Company shall issue and sell to the
Purchasers and the Purchasers shall purchase the Debentures for an aggregate
purchase price of $2,500,000. The closing of the purchase and sale of the
Debentures (the "CLOSING") shall take place at the offices of Xxxxxxxx
Xxxxxxxxx Xxxxxx Xxxxxxxx & Xxxxxx LLP (the "ESCROW AGENT"), 0000 Xxxxxx xx
xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, immediately following the execution
hereof or such later date as the parties shall agree. The date of the
Closing is hereinafter referred to as the "CLOSING DATE."
(ii) Prior to the Closing the parties shall deliver to
the Escrow Agent such items as are required to be delivered by them in
accordance with and subject to the terms and conditions of the Escrow
Agreement, dated as of the date hereof, by and among the Company, the
Purchasers and the Escrow Agent (the "ESCROW AGREEMENT"), including, the
following: (i) the Company shall deliver or cause to be delivered (A)
Debentures in aggregate principal amount equal to $500,000, registered in the
name of DSF, (B) Debentures in aggregate principal amount equal to
$2,000,000, registered in the name of JNC, (C) the Warrants (as defined in
Section 3.16), and (D) the legal opinions of Xxxxxxx & Xxxxxx LLP
substantially in the form of EXHIBIT C ("LEGAL OPINION") addressed to each
Purchaser; (ii) DSF shall deliver or cause to be delivered $500,000 in United
States dollars; (iii) JNC shall deliver or cause to be delivered $2,000,000
in United States
dollars; and (iv) each party hereto shall deliver or cause to be delivered
all other executed instruments, agreements and certificates as are required
to be delivered by or on their behalf at the Closing.
1.2 FORM OF DEBENTURES. The Debentures shall be in the form of
EXHIBIT A.
1.3 CERTAIN DEFINITIONS. For purposes of this Agreement,
"CONVERSION PRICE," "ORIGINAL ISSUE DATE," "CONVERSION DATE", "TRADING DAY",
"BUSINESS DAY " and "PER SHARE MARKET VALUE" shall have the meanings set
forth in the Debentures; and "MARKET PRICE" as at any date shall mean the
average Per Share Market Value for the five (5) Trading Days immediately
preceding such date.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY.
The Company hereby makes the following representations and warranties to the
Purchasers:
(a) ORGANIZATION AND QUALIFICATION. The Company is a
corporation, duly incorporated, validly existing and in good standing under
the laws of the jurisdiction of its incorporation, with the requisite
corporate power and authority to own and use its properties and assets and to
carry on its business as currently conducted. The Company has no
subsidiaries other than as set forth in SCHEDULE 2.1(a) attached hereto
(collectively, the "SUBSIDIARIES"). Each of the Subsidiaries is a
corporation, duly incorporated, validly existing and in good standing under
the laws of the jurisdiction of its incorporation, with the full corporate
power and authority to own and use its properties and assets and to carry on
its business as currently conducted. Each of the Company and the
Subsidiaries is duly qualified to do business and is in good standing as a
foreign corporation in each jurisdiction in which the nature of the business
conducted or property owned by it makes such qualification necessary, except
where the failure to be so qualified or in good standing, as the case may be,
could not, individually or in the aggregate, (x) adversely affect the
legality, validity or enforceability of this Agreement, the Debentures, the
Escrow Agreement, the Warrants or the Registration Rights Agreement, dated
the date hereof, among the Company and the Purchasers (the "REGISTRATION
RIGHTS AGREEMENT" and, together with this Agreement, the Debentures and the
Warrants, the "TRANSACTION DOCUMENTS"), (y) have a material adverse effect on
the results of operations, assets, prospects, or condition (financial or
otherwise) of the Company and the Subsidiaries, taken as a whole, or (z)
adversely impair the Company's ability to perform fully on a timely basis its
obligations under any Transaction Document (any of the foregoing, a "MATERIAL
ADVERSE EFFECT").
(b) AUTHORIZATION; ENFORCEMENT. The Company has the
requisite corporate power and authority to enter into and to consummate the
transactions contemplated by the Transaction Documents and otherwise to carry
out its obligations thereunder. The execution and delivery of each of the
Transaction Documents by the Company and the consummation by it of the
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transactions contemplated thereby have been duly authorized by all necessary
action on the part of the Company. Each of the Transaction Documents has
been duly executed by the Company and when delivered in accordance with the
terms hereof shall constitute the legal, valid and binding obligation of the
Company enforceable against the Company in accordance with its terms, except
as such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or
affecting generally the enforcement of, creditors' rights and remedies or by
other equitable principles of general application. Neither the Company nor
any Subsidiary is in violation of any of the provisions of its respective
certificate of incorporation, by-laws or other charter documents.
(c) CAPITALIZATION. The authorized, issued and outstanding
capital stock of the Company is set forth in SCHEDULE 2.1(c). No shares of
Common Stock are entitled to preemptive or similar rights, nor is any holder
of the Common Stock entitled to preemptive or similar rights arising out of
any agreement or understanding with the Company by virtue of any of the
Transaction Documents. Except as disclosed in SCHEDULE 2.1(c), there are no
outstanding options, warrants, script rights to subscribe to, calls or
commitments of any character whatsoever relating to, or, except as a result
of the purchase and sale of the Debentures and Warrants hereunder,
securities, rights or obligations convertible into or exchangeable for, or
giving any person any right to subscribe for or acquire any shares of Common
Stock, or contracts, commitments, understandings, or arrangements by which
the Company or any Subsidiary is or may become bound to issue additional
shares of Common Stock, or securities or rights convertible or exchangeable
into shares of Common Stock. To the knowledge of the Company, except as
specifically disclosed in the Disclosure Materials (as defined below) or
SCHEDULE 2.1(c), no Person (as defined below) beneficially owns (as
determined pursuant to Rule 13d-3 promulgated under the Securities Exchange
Act of 1934, as amended (the "EXCHANGE ACT")) or has the right to acquire by
agreement with or by obligation binding upon the Company, beneficial
ownership of in excess of 5% of the Common Stock. A "PERSON" means an
individual or corporation, partnership, trust, incorporated or unincorporated
association, joint venture, limited liability company, joint stock company,
government (or an agency or subdivision thereof) or other entity of any kind.
(d) ISSUANCE OF DEBENTURES AND WARRANTS. The Debentures and the
Warrants are duly authorized, and, when issued in accordance with the terms
hereof, shall be validly issued, fully paid and nonassessable, free and clear of
all liens, encumbrances and rights of first refusals of any kind (collectively,
"LIENS"). The Company has and at all times while the Debentures and the
Warrants are outstanding will maintain an adequate reserve of duly authorized
shares of Common Stock to enable it to perform its conversion, exercise and
other obligations under this Agreement, the Warrants and the Debentures and in
no circumstances shall such reserved and available shares of Common Stock be
less than the sum of (i) 200% of (A) the number of shares of Common Stock as
would be issuable upon conversion in full of the Debentures, assuming such
conversion were effected on the Original Issue Date and (B) the number of shares
of Common Stock as are issuable as payment of interest on the Debentures, and
(ii) the number of shares of Common Stock as are issuable upon exercise in full
of the Warrants (the "INITIAL RESERVE"). If at any time the sum of the number
of shares of Common Stock issuable (a) upon conversion in full of the then
outstanding Debentures, (b) as the payment of interest on the Debentures
(assuming all such interest is to be paid in Common Stock) and (c) upon exercise
in full of the Warrants exceeds 85% of the Initial
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Reserve, the Company shall duly reserve 200% of the number of shares of
Common Stock equal to such excess to fulfill such obligations. The
obligation shall similarly apply to successive excesses. The shares of
Common Stock issuable upon conversion of the Debentures, as payment of
interest in respect thereof and upon exercise of the Warrants are sometimes
referred to herein as the "UNDERLYING SHARES," and the Debentures, Warrants
and Underlying Shares are, collectively, the "SECURITIES." When issued in
accordance with the terms of the Debentures and the Warrants, the Underlying
Shares will be duly authorized, validly issued, fully paid and nonassessable,
and free and clear of all Liens.
(e) NO CONFLICTS. The execution, delivery and performance of
the Transaction Documents by the Company and the consummation by the Company
of the transactions contemplated thereby do not and will not (i) conflict
with or violate any provision of its certificate of incorporation, bylaws or
other charter documents (each as amended through the date hereof) or (ii)
subject to obtaining the consents referred to in Section 2.1(f), 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 agreement,
indenture or instrument (evidencing a Company debt or otherwise) to which the
Company is a party or by which any property or asset of the Company is bound
or affected, or (iii) result in a violation of any law, rule, regulation,
order, judgment, injunction, decree or other restriction of any court or
governmental authority to which the Company is subject (including federal and
state securities laws and regulations), or by which any property or asset of
the Company is bound or affected, except in the case of each of clauses (ii)
and (iii), as could not, individually or in the aggregate, have or result in
a Material Adverse Effect. The business of the Company is not being conducted
in violation of any law, ordinance or regulation of any governmental
authority, except for violations which, individually and in the aggregate,
could not have or result in a Material Adverse Effect.
(f) CONSENTS AND APPROVALS. Except as specifically set forth
in SCHEDULE 2.1(f), neither the Company nor any Subsidiary is required to
obtain any consent, waiver, authorization or order of, or make any filing or
registration with, any court or other federal, state, local or other
governmental authority or other Person in connection with the execution,
delivery and performance by the Company of the Transaction Documents other
than (i) the filing of a registration statement covering the resale of the
Underlying Shares by the Purchasers (the "UNDERLYING SECURITIES REGISTRATION
STATEMENT") with the Securities and Exchange Commission (the "COMMISSION"),
(ii) the application for the listing of the Underlying Shares on the OTC
Bulletin Board (and with any other national securities exchange, market or
trading facility on which the Common Stock is then listed), (iii) state blue
sky laws, and (iv) other than, in all other cases, where the failure to
obtain such consent, waiver, authorization or order, or to give or make such
notice or filing, could not have or result in, individually or in the
aggregate, a Material Adverse Effect (together with the consents, waivers,
authorizations, orders, notices and filings referred to in SCHEDULE 2.1(f),
the "REQUIRED APPROVALS").
(g) LITIGATION; PROCEEDINGS. Except as specifically
disclosed in the Disclosure Materials (as hereinafter defined), there is no
action, suit, notice of violation, proceeding or investigation pending or, to
the best knowledge of the Company, threatened against or affecting the
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Company or any of its Subsidiaries or any of their respective properties
before or by any court, governmental or administrative agency or regulatory
authority (federal, state, county, local or foreign) which (i) adversely
affects or challenges the legality, validity or enforceability of any of the
Transaction Documents or the Securities or (ii) could, individually or in the
aggregate, have or result in a Material Adverse Effect.
(h) NO DEFAULT OR VIOLATION. Neither the Company nor any
Subsidiary (i) is in default under or in violation of (or has received notice
of a claim that it is in default under or that it is in violation of) any
indenture, promissory note, loan or credit agreement or any other agreement
or instrument to which it is a party or by which it or any of its properties
is bound, (ii) is in violation of any order of any court, arbitrator or
governmental body, or (iii) is in violation of any statute, rule or
regulation of any governmental authority, except as could not individually or
in the aggregate, have or result in, individually or in the aggregate, a
Material Adverse Effect.
(i) PRIVATE OFFERING. Subject in part to the truth and
accuracy of the Purchasers' representations set forth in Section 2.2, the
offer, sale and issuance of the Securities as contemplated by this Agreement
are exempt for the registration requirement of the Securities Act, and
neither the Company nor any Person acting on its behalf has taken or will
take any action which might subject the offering, issuance or sale of the
Securities to the registration requirements of Section 5 of the Securities
Act.
(j) DISCLOSURE MATERIALS. The financial statements of the
Company dated December 31, 1996, July 31, 1997 and any other financial
statements delivered by the Company to the Purchasers (the "FINANCIAL
STATEMENTS" and, together with the Schedules to this Agreement and other
documents and information furnished by or on behalf of the Company at any
time prior to the Closing, the "DISCLOSURE MATERIALS") comply in all material
respects with applicable accounting requirements. Such Financial Statements
have been prepared in accordance with generally accepted accounting
principles applied on a consistent basis during the periods involved, except
as may be otherwise specified in such Financial Statements or the notes
thereto, and fairly present in all material respects the financial position
of the Company as of and for the dates thereof and the results of operations
and cash flows for the periods then ended, subject, in the case of unaudited
statements, to normal year-end audit adjustments. There are no liabilities,
contingent or otherwise, of the Company involving material amounts not
disclosed in said Financial Statements. The Disclosure Materials do not
contain any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. Since July 31, 1997, there has been no event, occurrence or
development that has had or that could have or result in a Material Adverse
Effect.
(k) INVESTMENT COMPANY. The Company is not, and is not an
"Affiliate person" of, an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
(l) CERTAIN FEES. Except for fees payable to CDC Consulting,
Inc., no fees or commissions will be payable by the Company to any broker,
financial advisor, finder, investment
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banker, placement agent, or bank with respect to the transactions
contemplated hereby. The Purchasers shall have no obligation with respect to
such fees or with respect to any claims made by or on behalf of other Persons
for fees of a type contemplated in this Section that may be due in connection
with the transactions contemplated hereby. The Company shall indemnify and
hold harmless each Purchaser, its respective employees, officers, directors,
agents, and partners, and their respective Affiliates (as such term is
defined under Rule 405 promulgated under the Securities Act), from and
against all claims, losses, damages, costs (including the costs of
preparation and attorney's fees) and expenses suffered in respect of any such
claimed or existing fees, as and when incurred.
(m) SOLICITATION MATERIALS. The Company has not (i)
distributed any offering materials in connection with the offering and sale
of the Securities other than the Disclosure Materials and any amendments and
supplements thereto or (ii) solicited any offer to buy or sell the Securities
by means of any form of general solicitation or advertising.
(n) FORM SB-2 ELIGIBILITY. The Company is, and at the
Closing Date will be, eligible to register securities for resale with the
Commission under Form SB-2 promulgated under the Securities Act.
(o) EXCLUSIVITY. The Company shall not issue and sell
Debentures to any Person other than the Purchasers.
(p) LISTING AND MAINTENANCE REQUIREMENTS COMPLIANCE. The
Company has not in the two years preceding the date hereof received written
notice from any stock exchange, market or trading facility on which the
Common Stock is or has been listed (or on which it has been quoted) to the
effect that the Company is not in compliance with the listing or maintenance
requirements of such exchange, market or trading facility. The Company has
no reason to believe that it does not now or will not in the future meet any
such maintenance requirements.
(q) PATENTS AND TRADEMARKS. The Company has, or has rights
to use, all patents, patent applications, trademarks, trademark applications,
service marks, trade names, copyrights, licenses and rights which are
necessary for use in connection with its business and which the failure to so
have would have a Material Adverse Effect (collectively, the "INTELLECTUAL
PROPERTY RIGHTS"). To the best knowledge of the Company, there is no
existing infringement on any of the Intellectual Property Rights.
(r) DISCLOSURE. All information relating to or concerning
the Company set forth in the Transaction Documents or provided to the
Purchasers or their respective representatives, agents and counsel in
connection with the transactions contemplated hereby is true and correct in
all material respects and does not fail to state any material fact necessary
in order to make the statements herein or therein, in light of the
circumstances under which they were made, not misleading. The Company
confirms that it has not provided to any of the Purchasers or any of their
representatives or agents any information that constitutes or might
constitute material non-public information other than information that has
specifically been identified to the recipient as material non-public
information in writing. The Company understands and confirms that the
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Purchasers shall be relying on the foregoing representation in effecting
transactions in securities of the Company.
(s) REGISTRATION RIGHTS. Except as provided in the
Registration Rights Agreement, the Company has not granted or agreed to grant
any registration rights, including piggy-back registration rights, to any
Person.
2.2 REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS. Each
Purchaser hereby, severally and not jointly, makes the following
representations and warranties to the Company.
(a) ORGANIZATION; AUTHORITY. Such Purchaser is an entity
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization with the requisite power and authority to
enter into and to consummate the transactions contemplated by the Transaction
Documents and to carry out its obligations thereunder. The acquisition of
the Securities to be acquired hereunder by such Purchaser has been duly
authorized by all necessary action on the part of such Purchaser. Each of
this Agreement, the Registration Rights Agreement and the Escrow Agreement
has been duly executed by such Purchaser and, when delivered by such
Purchaser in accordance with the terms hereof and the Escrow Agreement
constitutes the valid and legally binding obligation of such Purchaser,
enforceable against it in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws
of general applicability relating to or affecting creditors' rights generally
and to general principles of equity.
(b) INVESTMENT INTENT. Such Purchaser is acquiring the
Securities to be acquired hereunder by such Purchaser for its own account for
investment purposes only and not with a view to or for distributing or
reselling such Securities or any part thereof or interest therein, without
prejudice, however, to such Purchaser's right, subject to the provisions of
this Agreement and the Registration Rights Agreement, at all times to sell or
otherwise dispose of all or any part of such Securities pursuant to an
effective registration statement under the Securities Act and in compliance
with applicable state securities laws or under an exemption from such
registration.
(c) PURCHASER STATUS. At the time such Purchaser was offered
the Securities to be acquired hereunder by such Purchaser, it was, at the
date hereof, it is, and at the Closing Date, it will be, an "accredited
investor" as defined in Rule 501(a) under the Securities Act.
(d) EXPERIENCE OF PURCHASER. Such Purchaser either alone or
together with its representatives, has such knowledge, sophistication and
experience in business and financial matters so as to be capable of
evaluating the merits and risks of the prospective investment in the
Securities, and has so evaluated the merits and risks of such investment.
(e) ABILITY OF PURCHASER TO BEAR RISK OF INVESTMENT. Such
Purchaser acknowledges that an investment in the Securities is speculative
and involves a high degree of risk. Such Purchaser is able to bear the
economic risk of an investment in the Securities to be acquired hereunder by
such Purchaser, and, at the present time, is able to afford a complete loss
of such investment.
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(f) ACCESS TO INFORMATION. Such Purchaser acknowledges
receipt of the Disclosure Materials and further acknowledges that it has been
afforded (i) the opportunity to ask such questions as it has deemed necessary
of, and to receive answers from, representatives of the Company concerning
the terms and conditions of the offering of the Securities, and the merits
and risks of investing in the Securities, (ii) access to information about
the Company and the Company's financial condition, results of operations,
business, properties, management and prospects sufficient to enable it to
evaluate its investment and (iii) the opportunity to obtain such additional
information which the Company possesses or can acquire without unreasonable
effort or expense that is necessary to make an informed investment decision
with respect to the investment and to verify the accuracy and completeness of
the information contained in the Disclosure Materials. Neither such
inquiries nor any other investigation conducted by or on behalf of such
Purchaser or its representatives, agents or counsel shall modify, amend or
affect such Purchaser's right to rely on the truth, accuracy and completeness
of the Disclosure Materials and the Company's representations and warranties
contained in the Transaction Documents.
(g) RELIANCE. Such Purchaser understands and acknowledges
that (i) the Securities to be acquired by it hereunder are being offered and
sold to it without registration under the Securities Act in a private
placement that is exempt from the registration provisions of the Securities
Act and (ii) the availability of such exemption, depends in part on, and the
Company will rely upon the accuracy and truthfulness of, the foregoing
representations and such Purchaser hereby consents to such reliance.
The Company acknowledges and agrees that the Purchasers make
no representations or warranties with respect to the transactions
contemplated hereby other than those specifically set forth in this Section
2.2.
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ARTICLE III
OTHER AGREEMENTS OF THE PARTIES
3.1 TRANSFER RESTRICTIONS. (a) Securities may only be disposed
of pursuant to an effective registration statement under the Securities Act,
to the Company or pursuant to an available exemption from or in a transaction
not subject to the registration requirements thereof. In connection with any
transfer of any Securities other than pursuant to an effective registration
statement or to the Company, the Company may require the transferor thereof
to provide to the Company an opinion of counsel selected by the transferor,
the form and substance of which opinion shall be reasonably satisfactory to
the Company, to the effect that such transfer does not require registration
under the Securities Act. Notwithstanding the foregoing, the Company hereby
consents to and agrees to register on the books and records of the Company or
on the register of any transfer agent for the Securities (i) any transfer of
Securities by one Purchaser to another Purchaser, and agrees that no
documentation other than executed transfer documents shall be required for
any such transfer, and (ii) any transfer by any Purchaser to an Affiliate (as
such term is defined under Rule 405 promulgated under the Securities Act) of
such Purchaser or to an Affiliate of another Purchaser, or any transfers
among any such Affiliates provided the transferee certifies to the Company
that it is an "accredited investor" as defined in Rule 501(a) under the
Securities Act and makes the appropriate investment representations. Any
such Purchaser or Affiliate transferee shall have the rights of a Purchaser
under this Agreement and the Registration Rights Agreement.
(b) The Purchasers agree to the imprinting, so long as is
required by this Section 3.1(b), of the following legend on the Securities:
NEITHER THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE
SECURITIES ARE [CONVERTIBLE] [EXERCISABLE] HAVE BEEN REGISTERED
WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES
COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES
LAWS.
[FOR DEBENTURES ONLY] THIS DEBENTURE IS SUBJECT TO CERTAIN
RESTRICTIONS ON CONVERSION SET FORTH IN SECTION 3.8 OF THE
CONVERTIBLE DEBENTURE PURCHASE AGREEMENT, DATED AS OF JANUARY 22,
1998, AMONG FIX-CORP INTERNATIONAL, INC. (THE "COMPANY") AND THE
ORIGINAL HOLDER HEREOF. A COPY OF THAT AGREEMENT IS ON FILE AT
THE PRINCIPAL OFFICE OF THE COMPANY.
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Underlying Shares shall not contain the legend set forth above
if the conversion of Debentures, exercise of Warrants or other issuances of
Underlying Shares, as the case may be, occurs at any time while an Underlying
Securities Registration Statement is effective under the Securities Act or,
in the event there is not an effective Underlying Securities Registration
Statement at such time, if in the opinion of counsel to the Company such
legend is not required under applicable requirements of the Securities Act
(including judicial interpretations and pronouncements issued by the staff of
the Commission). The Company agrees that it will provide each Purchaser,
upon request, with a certificate or certificates representing Underlying
Shares, free from such legend at such time as such legend is no longer
required hereunder. The Company may not make any notation on its records or
give instructions to any transfer agent of the Company which enlarge the
restrictions of transfer set forth in this Section 3.1(b).
3.2 ACKNOWLEDGEMENT OF DILUTION. The Company acknowledges that
the issuance of Underlying Shares upon (i) conversion of the Debentures and
as payment of interest thereon and (ii) exercise of the Warrants may result
in dilution of the outstanding shares of Common Stock, which dilution may be
substantial under certain market conditions. The Company further
acknowledges that its obligation to issue Underlying Shares in accordance
with the Debentures and the Warrants is unconditional and absolute regardless
of the effect of any such dilution.
3.3 FURNISHING OF INFORMATION. As long as the Purchasers own
Securities, the Company covenants to timely file (or obtain extensions in
respect thereof and file within the applicable grace period) all reports
required to be filed by the Company after the Filing Date (as defined in the
Registration Rights Agreement) pursuant to Section 13(a) or 15(d) of the
Exchange Act. If at any time prior to the date on which the Purchasers may
resell all of their Underlying Shares without volume restrictions pursuant to
Rule 144(k) promulgated under the Securities Act (as determined by counsel to
the Company pursuant to a written opinion letter to such effect, addressed
and acceptable to the Company's transfer agent for the benefit of and
enforceable by the Purchasers) the Company is not required to file reports
pursuant to such sections, it will prepare and furnish to the Purchasers and
make publicly available in accordance with Rule 144(c) promulgated under the
Securities Act annual and quarterly financial statements, together with a
discussion and analysis of such financial statements in form and substance
substantially similar to those that would otherwise be required to be
included in reports required by Section 13(a) or 15(d) of the Exchange Act in
the time period that such filings would have been required to have been made
under the Exchange Act. The Company further covenants that it will take such
further action as any holder of Securities may reasonably request, all to the
extent required from time to time to enable such Person to sell Securities
without registration under the Securities Act within the limitation of the
exemptions provided by Rule 144 promulgated under the Securities Act,
including the legal opinion referenced above in this Section. Upon the
request of any such Person, the Company shall deliver to such Person a
written certification of a duly authorized officer as to whether it has
complied with such requirements.
3.4 USE OF DISCLOSURE MATERIALS. The Company consents to the use
of the Disclosure Materials and any information provided by or on behalf of
the Company pursuant to Section 3.3, and any amendments and supplements
thereto, by the Purchasers in connection with resales of the
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Securities other than pursuant to an effective registration statement;
PROVIDED, THAT the Company shall have a reasonable opportunity to update such
information.
3.5 BLUE SKY LAWS. In accordance with the Registration Rights
Agreement, the Company shall qualify the Underlying Shares under the
securities or Blue Sky laws of such jurisdictions as the Purchasers may
request and shall continue such qualification at all times during the
Effectiveness Period (as defined in the Registration Rights Agreement);
PROVIDED, HOWEVER, that neither the Company nor its Subsidiaries shall be
required in connection therewith to qualify as a foreign corporation where
they are not now so qualified or to take any action that would subject the
Company to general service of process in any such jurisdiction where it is
not then so subject.
3.6 INTEGRATION. The Company shall not and shall use its best
efforts to ensure that no Affiliate shall sell, offer for sale or solicit
offers to buy or otherwise negotiate in respect of any security (as defined
in Section 2 of the Securities Act) that would be integrated with the offer
or sale of the Securities in a manner that would require the registration
under the Securities Act of the issue or sale of the Securities to the
Purchasers.
3.7 INCREASE IN AUTHORIZED SHARES. At such time as the Company
would be, if a notice of conversion or exercise (as the case may be) were to
be delivered on such date, precluded from (a) converting the full outstanding
principal amount of Debentures (and paying any accrued but unpaid interest in
respect thereof in shares of Common Stock) that remain unconverted at such
date or (b) honoring the exercise in full of the Warrants due to the
unavailability of a sufficient number of shares of authorized but unissued or
re-acquired Common Stock, the Board of Directors of the Company shall
promptly (and in any case within 30 Business Days from such date) prepare and
mail to the shareholders of the Company proxy materials requesting
authorization to amend the Company's restated certificate of incorporation to
increase the number of shares of Common Stock which the Company is authorized
to issue to at least a number of shares equal to the sum of (i) all shares of
Common Stock then outstanding, (ii) the number of shares of Common Stock
issuable on account of all outstanding warrants, options and convertible
securities (other than the Debentures and the Warrants) and on account of all
shares reserved under any stock option, stock purchase, warrant or similar
plan, (iii) 200% of the number of Underlying Shares as would then be issuable
upon a conversion in full of the then outstanding Debentures and as payment
of all future interest thereon in shares of common Stock in accordance with
the terms of this Agreement and the Debentures and (iv) such number of
Underlying Shares as would then be issuable upon the exercise in full of the
warrants. In connection therewith, the Board of Directors shall (x) adopt
proper resolutions authorizing such increase, (y) recommend to and otherwise
use its best efforts to promptly and duly obtain stockholder approval to
carry out such resolutions (and hold a special meeting of the shareholders no
later than the 60th day after delivery of the proxy materials relating to
such meeting) and (z) within 5 Business Days of obtaining such shareholder
authorization, file an appropriate amendment to the Company's certificate of
incorporation to evidence such increase.
3.8 PURCHASER OWNERSHIP OF COMMON STOCK. In no event shall a
Purchaser be permitted to use its ability to convert Debentures or exercise
its Warrants to the extent that such conversion or
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exercise would result in that Purchaser beneficially owning (for purposes of
Rule 13d-3 under the Exchange Act and the rules thereunder) in excess of
4.999% of the then issued and outstanding shares of Common Stock, including
shares issuable upon conversion of the Debentures held by such Purchaser
after application of this Section. To the extent that the limitation
contained in this Section applies, the determination of whether Debentures
are convertible (in relation to other securities owned by a Purchaser) and of
which Debentures are convertible shall be in the sole discretion of such
Purchaser, and the submission of Debentures for conversion shall be deemed to
be such Purchaser's determination of whether such Debentures are convertible
(in relation to other securities owned by a Purchaser) and of which
Debentures are convertible, in each case subject to such aggregate percentage
limitation, and the Company shall have no obligation to verify or confirm the
accuracy of such determination. Nothing contained herein shall be deemed to
restrict the right of a Purchaser to convert Debentures at such time as such
conversion will not violate the provisions of this Section. Notwithstanding
anything to the contrary contained herein, if ten days have elapsed since a
Purchaser has declared an event of default under any Transaction Document and
such event shall not have been cured to such Purchaser's satisfaction prior
to the expiration of such ten-day period, the provisions of this Section 3.8
shall be null and void AB INITIO.
3.9 LISTING OF UNDERLYING SHARES. If the Common Stock hereafter
is listed for trading on the Nasdaq National Market, Nasdaq SmallCap Market
(or on the American Stock Exchange or New York Stock Exchange, or any other
national securities market or exchange), then the Company shall (1) take all
necessary steps to list the Underlying Shares thereon, including the
preparation of any required additional listing application therefor covering
at least the sum of (i) two times the number of Underlying Shares as would be
issuable upon a conversion in full of the then outstanding principal amount
of Debentures (plus all Underlying Shares issuable as payment of interest
thereon, assuming all such interest were paid in shares of Common Stock) and
upon exercise in full of the then unexercised portion of the Warrants and (2)
provide to the Purchasers evidence of such listing, and the Company shall
thereafter maintain the listing of its Common Stock on such exchange or
market as long as Underlying Shares are issuable and/or outstanding. The
Company will use its commercially reasonable efforts to list the Common Stock
for trading on either the Nasdaq SmallCap Market or Nasdaq National Market as
soon as possible after the Closing Date.
3.10 CONVERSION PROCEDURES. EXHIBIT E sets forth the procedures
with respect to the conversion of the Debentures, including the form of legal
opinion, if necessary, that shall be rendered to the Company's transfer agent
and such other information and instructions as may be reasonably necessary to
enable the Purchasers to exercise its right of conversion smoothly and
expeditiously which are not set forth in the Debentures.
3.11 PURCHASERS' RIGHTS IF TRADING IN COMMON STOCK IS SUSPENDED OR
DELISTED. If at any time while any Purchaser (or any assignee thereof) owns
any Securities, trading in the shares of the Common Stock is suspended on or
delisted from the OTC Bulletin Board or any other principal market or
exchange for such shares (other than as a result of the suspension of trading
in securities on such market or exchange generally, or temporary suspensions
pending the release of material
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information) for more than three (3) Trading Days, then, notwithstanding
anything to the contrary contained in any Transaction Document, at a
Purchaser's option exercisable by ten Business Days prior written notice to
the Company, the Company shall, PROVIDED, THAT trading has not been
reinstated within such period, repay the entire principal amount of then
outstanding Debentures and redeem all then outstanding Underlying Shares then
held by such Purchaser, at an aggregate purchase price equal to the sum of
(I) the aggregate outstanding principal amount of Debentures then held by
such Purchaser divided by the Conversion Price on (a) the day prior to the
date of such suspension or delisting, (b) the day of such notice or (c) the
date of payment in full of the repurchase price calculated under this
Section, whichever is less, and multiplied by the Market Price preceding (x)
the day prior to the date of such suspension or delisting, (y) the day of
such notice and (z) the date of payment in full of the repurchase price
calculated under this Section, whichever is greater, (II) the aggregate of
all accrued but unpaid interest and other non-principal amounts (including
liquidated damages, if any) then payable in respect of all Debentures to be
repaid, (III) the number of Underlying Shares then held by such Purchaser
multiplied by the Market Price immediately preceding (x) the day prior to the
date of such suspension or delisting, (y) the date of the notice or (z) the
date of payment in full by the Company of the repurchase price calculated
under this Section, whichever is greater, and (IV) interest on the amounts
set forth in I - III above accruing from the 10th Business Day after such
notice until the repurchase price under this Section is paid in full at the
rate of 18% per annum. If after the Original Issue Date the Common Stock
shall be listed for trading or quoted on the Nasdaq SmallCap Market, Nasdaq
National Market or any other national securities exchange or market, this
provision shall similarly apply to any delistings or suspensions therefrom.
3.12 USE OF PROCEEDS. The Company shall use all of the proceeds
from the sale of the Securities for working capital purposes and not for the
satisfaction of any portion of Company debt or to redeem Company equity or
equity-equivalent securities. Pending application of the proceeds of this
placement in the manner permitted hereby the Company will invest such
proceeds in money market funds, interest bearing accounts and/or short-term,
investment grade interest bearing securities.
3.13 NOTICE OF BREACHES. Each of the Company and each Purchaser
shall give prompt written notice to the other of any breach by it of any
representation, warranty or other agreement contained in any Transaction
Document, as well as any events or occurrences arising after the date hereof,
which would reasonably be likely to cause any representation or warranty or
other agreement of such party, as the case may be, contained in the
Transaction Document to be incorrect or breached as of such Closing Date.
However, no disclosure by either party pursuant to this Section shall be
deemed to cure any breach of any representation, warranty or other agreement
contained in any Transaction Document.
Notwithstanding the generality of the foregoing, the Company shall
promptly notify the Purchasers of any notice or claim (written or oral) that
it receives from any lender of the Company to the effect that the
consummation of the transactions contemplated by the Transaction Documents
violates or would violate any written agreement or understanding between such
lender and the Company, and the Company shall promptly furnish by facsimile
to the holders of the Debentures a copy of any written statement in support
of or relating to such claim or notice.
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3.14 CONVERSION OBLIGATIONS OF THE COMPANY. The Company shall
honor conversions of the Debentures and exercises of the Warrants and shall
deliver Underlying Shares in accordance with the respective terms and
conditions and time periods set forth in the Debentures and the Warrants.
3.15 RIGHT OF FIRST REFUSAL; SUBSEQUENT REGISTRATIONS; CERTAIN
CORPORATE ACTIONS. (a) The Company shall not, directly or indirectly,
without the prior written consent of the Encore Capital Management, L.L.C.
("Encore") on behalf of the Purchasers, offer, sell, grant any option to
purchase, or otherwise dispose (or announce any offer, sale, grant or any
option to purchase or other disposition) of any of its or its Affiliates
equity, equity-equivalent or derivative securities (a "SUBSEQUENT FINANCING")
for a period of 180 days after the Closing Date, except (i) the granting of
options or warrants to employees, officers and directors, and the issuance of
shares upon exercise of options granted, under any stock option plan
heretofore or hereinafter duly adopted by the Company, (ii) shares issued
upon exercise of any currently outstanding warrants and upon conversion of
any currently outstanding convertible preferred stock in each case disclosed
in SCHEDULE 2.1(c), and (iii) shares of Common Stock issued upon conversion
of the Debentures, as payment of interest thereon, or upon exercise of the
Warrants in accordance with their respective terms, unless (A) the Company
delivers to Encore a written notice (the "SUBSEQUENT FINANCING NOTICE") of
its intention to effect such Subsequent Financing, which Subsequent Financing
Notice shall describe in reasonable detail the proposed terms of such
Subsequent Financing, the amount of proceeds intended to be raised
thereunder, the Person with whom such Subsequent Financing shall be affected,
and a term sheet or similar document relating thereto shall be attached to
such Subsequent Financing Notice and (B) Encore shall not have notified the
Company by 5:00 p.m. (New York City Time) on the tenth (10th) Trading Day
after its receipt of the Subsequent Financing Notice of its willingness to
cause either or both of the Purchasers to provide (or to cause its sole
designee to provide), subject to completion of mutually acceptable
documentation, financing to the Company on substantially the terms set forth
in the Subsequent Financing Notice. If Encore shall fail to notify the
Company of its intention to enter into such negotiations within such time
period, the Company may effect the Subsequent Financing substantially upon
the terms and to the Persons (or Affiliates of such Persons) set forth in the
Subsequent Financing Notice; PROVIDED, that the Company shall provide Encore
with a second Subsequent Financing Notice, and Encore shall again have the
right of first refusal set forth above in this paragraph (a), if the
Subsequent Financing subject to the initial Subsequent Financing Notice shall
not have been consummated for any reason on the terms set forth in such
Subsequent Financing Notice within thirty (30) Trading Days after the date of
the initial Subsequent Financing Notice with the Person (or an Affiliate of
such Person) identified in the Subsequent Financing Notice.
(b) Except Underlying Shares and other "Registrable
Securities" (as such term is defined in the Registration Rights Agreement) to
be registered in accordance with the Registration Rights Agreement,
securities to be registered pursuant to Schedule 6(c) to the Registration
Rights Agreement, and other than Company securities to be registered for
resale in connection with financings permitted pursuant to paragraph (a)(i)
through (iii) of this Section, the Company shall not, without the prior
written consent of Encore, (i) issue or sell any of its or any of its
Affiliates' equity or equity-equivalent securities pursuant to Regulation S
promulgated under the Securities
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Act, or (ii) register for resale any securities of the Company for a period
of not less than 90 Trading Days after the date that the Underlying
Securities Registration Statement is declared effective by the Commission.
Any days that a Purchaser is not permitted to sell Underlying Shares under
the Underlying Securities Registration Statement shall be added to such 90
Trading Day period for the purposes of (i) and (ii) above.
(c) As long as there are Debentures outstanding, the
Company shall not and shall cause the Subsidiaries not to, without the
consent of the holders of the Debentures, (i) amend its certificate of
incorporation, bylaws or other charter documents so as to adversely affect
any rights of the holders of Debentures; (ii) repay, repurchase or offer to
repay, repurchase or otherwise acquire shares of its Common Stock other than
as to the Underlying Shares; or (iii) enter into any agreement with respect
to any of the foregoing.
3.16 THE WARRANTS. Prior to the Closing, the Company shall issue
and deliver to the Escrow Agent for delivery at the closing (a) a Common
Stock purchase warrant, in the form of EXHIBIT D and registered in the name
of JNC (the "JNC WARRANT"), pursuant to which JNC shall have the right at any
time and from time to time thereafter through the third anniversary of the
date of issuance thereof, to acquire 158,730 shares of Common Stock at an
exercise price per share equal to $3.34 and (b) to DSF, a Common Stock
purchase warrant, in the form of EXHIBIT D and registered in the name of DSF
(the "DSF WARRANT," and, collectively with the JNC Warrant, the "WARRANTS"),
pursuant to which DSF shall have the right at any time and from time to time
thereafter through the third anniversary of the date of issuance thereof, to
acquire 39,683 shares of Common Stock at an exercise price per share equal to
$3.34.
3.17 TRANSFER OF INTELLECTUAL PROPERTY RIGHTS. Except in
connection with the sale of all or substantially all of the assets of the
Company, the Company shall not transfer, sell or otherwise dispose of, any
Intellectual Property Rights, or allow the Intellectual Property Rights to
become subject to any Liens, or fail to renew such Intellectual Property
Rights (if renewable and would otherwise expire), without the prior written
consent of the Purchasers.
3.18 FORM SB-2. The Company has filed with the Commission on
January 20, 1998 a registration statement on Form SB-2 (the "FORM SB-2")
pursuant to the Exchange Act. The Company shall use its best efforts to
amend the Form SB-2 in order to include the resale of the Underlying
Securities thereunder as soon as possible but in no event later than the 20th
day after the Closing Date and shall take all commercially reasonable steps
necessary to cause such Form SB-2 to be declared effective as soon as
possible thereafter but in no event later than the 50th day after the Closing
Date, and shall provide to the Purchasers evidence of such filing and
effectiveness.
ARTICLE IV
MISCELLANEOUS
4.1 FEES AND EXPENSES. The Company shall pay at the Closing
$7,500 to the Escrow Agent for the legal fees and disbursements incurred by
the Purchasers in connection with the preparation and negotiation of the
Transaction Documents. Other than the amount
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contemplated by the immediately preceding sentence and except as set forth in
the Registration Rights Agreement, each party shall pay the fees and expenses
of its advisers, counsel, accountants and other experts, if any, and all
other expenses incurred by such party incident to the negotiation,
preparation, execution, delivery and performance of this Agreement. The
Company shall pay all stamp and other taxes and duties levied in connection
with the issuance of the Debentures pursuant hereto. The Purchasers shall be
responsible for their own respective tax liability that may arise as a result
of the investment hereunder or the transactions contemplated by this
Agreement.
4.2 ENTIRE AGREEMENT; AMENDMENTS. This Agreement, together
with the Exhibits and Schedules hereto, the Debentures and the Warrants
contain the entire understanding of the parties with respect to the subject
matter hereof and supersede all prior agreements and understandings, oral or
written, with respect to such matters.
4.3 NOTICES. Any and all notices or other communications or
deliveries required or permitted to be provided hereunder shall be in writing
and shall be deemed given and effective on the earliest of (i) the date of
transmission, if such notice or communication is delivered via facsimile at
the facsimile telephone number specified in this Section prior to 7:00 p.m.
(New York City time) on a Business Day, (ii) the Business Day after the date
of transmission, if such notice or communication is delivered via facsimile
at the facsimile telephone number specified in the Purchase Agreement later
than 7:00 p.m. (New York City time) on any date and earlier than 11:59 p.m.
(New York City time) on such date, (iii) the Business Day following the date
of mailing, if sent by nationally recognized overnight courier service, or
(iv) upon actual receipt by the party to whom such notice is required to be
given. The address for such notices and communications shall be as follows:
If to the Company: Fix-Corp International, Inc.
0000 Xxxxx Xxxxx Xxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
Attn: Chief Financial Officer
With copies to: Xxxxxxx & Xxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
Attn: Xxxxxx Xxxxxx
If to JNC: JNC Opportunity Fund Ltd.
Olympia Capital (Cayman) Ltd.
c/o Olympia Capital (Bermuda) Ltd.
Xxxxxxxx House
00 Xxxx Xxxxxx
Xxxxxxxx XX00
-00-
Xxxxxxx
Xxxxxxxxx No.: (000) 000-0000
Attn: Director
If to DSF: Diversified Strategies Fund, L.P.
c/o Encore Capital Management, L.L.C.
00000 Xxxxxxx Xxxxxx Xxxxx
Xxxxx 000
Xxxxxx, XX 00000
Facsimile No.: (000) 000-0000
Attn: Xxxx X. Xxxx
With copies to (for Encore Capital Management, L.L.C.
communications to 00000 Xxxxxxx Xxxxxx Xxxxx
either Purchaser): Xxxxx 000
Xxxxxx, XX 00000
Facsimile No.: (000) 000-0000
Attn: Xxxx X. Xxxx
-and-
Xxxxxxxx Xxxxxxxxx Xxxxxx Xxxxxxxx &
Xxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Facsimile No.: (000) 000-0000
Attn: Xxxx X. Xxxxx
or such other address as may be designated in writing hereafter, in the same
manner, by such Person.
4.4 AMENDMENTS; WAIVERS. No provision of this Agreement may
be waived or amended except in a written instrument signed, in the case of an
amendment, by both the Company and the Purchasers; or, in the case of a
waiver, by the party against whom enforcement of any such waiver is sought.
No waiver of any default with respect to any provision, condition or
requirement of this Agreement shall be deemed to be a continuing waiver in
the future or a waiver of any other provision, condition or requirement
hereof, nor shall any delay or omission of either party to exercise any right
hereunder in any manner impair the exercise of any such right accruing to it
thereafter.
4.5 HEADINGS. The headings herein are for convenience only,
do not constitute a part of this Agreement and shall not be deemed to limit
or affect any of the provisions hereof.
4.6 SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to
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the benefit of the parties and their successors and permitted assigns,
including any Persons to whom any Purchaser transfers Debentures or Warrants.
The assignment by a party of this Agreement or any rights hereunder shall not
affect the obligations of such party under this Agreement.
4.7 NO THIRD-PARTY BENEFICIARIES. This Agreement is intended
for the benefit of the parties hereto and their respective permitted
successors and assigns and, other than with respect to permitted assignees
under Section 4.6, is not for the benefit of, nor may any provision hereof be
enforced by, any other Person. The obligations of the Purchasers under this
Agreement and the other Transaction Documents are several and not joint and
no Purchaser shall be responsible for any obligations of any other Purchaser.
4.8 GOVERNING LAW. This Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of
New York without regard to the principles of conflicts of law thereof.
4.9 SURVIVAL. The representations, warranties, agreements
and covenants contained in this Agreement shall survive the Closing and the
and conversion of the Debentures and exercise of the Warrants.
4.10 EXECUTION. This Agreement may be executed in two or more
counterparts, all of which when taken together 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 parties, it being understood
that all parties need not sign the same counterpart. In the event that any
signature is delivered by facsimile transmission, such signature shall create
a valid and binding obligation of the party executing (or on whose behalf
such signature is executed) the same with the same force and effect as if
such facsimile signature page were an original thereof.
4.11 PUBLICITY. The Company and the Purchasers shall consult
with each other in issuing any press releases or otherwise making public
statements with respect to the transactions contemplated hereby and no party
shall issue any such press release or otherwise make any such public
statement without the prior written consent of the other, which consent shall
not be unreasonably withheld or delayed, except that no prior consent shall
be required if such disclosure is required by law, in which such case the
disclosing party shall provide the other party with prior notice of such
public statement.
4.12 SEVERABILITY. In case any one or more of the provisions
of this Agreement shall be invalid or unenforceable in any respect, the
validity and enforceability of the remaining terms and provisions of this
Agreement shall not in any way be affected or impaired thereby and the
parties will attempt to agree upon a valid and enforceable provision which
shall be a reasonable substitute therefor, and upon so agreeing, shall
incorporate such substitute provision in this Agreement.
4.13 REMEDIES. Each of the parties to this Agreement
acknowledges and agrees that the other parties would be damaged irreparably
in the event any of the provisions of this Agreement are not performed in
accordance with their specific terms or otherwise are breached.
-18-
Accordingly, each of the parties hereto agrees that the other parties shall
be entitled to an injunction or injunctions to prevent breaches of the
provisions of this Agreement and to enforce specifically this Agreement and
the terms and provisions of this Agreement in any action instituted in any
court of the United States of America or any state thereof having
jurisdiction over the parties to this Agreement and the matter, in addition
to any other remedy to which they may be entitled, at law or in equity.
4.14 LIQUIDATED DAMAGES. Each of the parties to this Agreement
acknowledges and agrees that the any and all liquidated damage provisions set
forth in the Transaction Documents express a reasonable pre-estimate of the
damages which would be incurred.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have caused this
Debenture Purchase Agreement to be duly executed by their respective
authorized persons as of the date first indicated above.
FIX-CORP INTERNATIONAL, INC.
By: /s/ Xxxx Xxxxxx
---------------------------------
Name: Xxxx Xxxxxx
Title: President/CEO
JNC OPPORTUNITY FUND LTD.
By: /s/ Xxxxxx X. Xxxxx
---------------------------------
Name: Xxxxxx X. Xxxxx
Title: Director
DIVERSIFIED STRATEGIES FUND, L.P.
By: Encore Capital Management, L.L.C.
By: /s/ Xxxx X. Xxxx
------------------------------
Name: Xxxx X. Xxxx
Title: Managing Member
