EXHIBIT 10.68
ADC
APPLIED DATA COMMUNICATIONS
May 15, 2001
Xx. Xxxxxxx X. Xxxxxx
0000 Xxxx Xx Xxxxx Xxx
Xxxxxxx, XX 00000
Dear Xx. Xxxxxx:
Your note agreement with Applied Data Communications, Inc. ("ADC") provides for
the exchange of such note into registered shares of ADC's common stock in
quantity to include all principal, interest and fees, at the rate of one share
for every $.80 of such principal, fees and interest
ADC has been endeavoring to implement such conversion for the past several
weeks. We have been advised by counsel that the specific shares we anticipated
using for this purpose, would no longer be considered as "registered". Although
the shares were considered as registered at one time, their reacquisition by an
"affiliate" of ADC, as defined, changes their status to that of unregistered
shares.
Consequently, ADC is currently unable to provide such shares, pursuant to our
obligation to you. Reflecting on this, and in discussions with Xx. Xxxxxx X.
Xxxxx, an advisor to the company, ADC is offering an alternative conversion
program which we believe will be beneficial to you.
ADC is offering to convert your note into ADC preferred stock, Series B, which
is convertible into common shares, at the rate of 100 shares of common for each
share of the Series B preferred stock, with voting privileges based on the
number of common shares into which the Series B preferred stock is convertible.
As Xxxxxx xxx have already have advised you, as a further acknowledgment of the
alteration this represents to your agreement, ADC is offering to adjust the
number of Series B preferred shares upward by 20%. This will provide to you an
additional 20% common shares, over that to which you would otherwise have
received. ADC will convert such Series B shares to common shares and to
register such shares within the fourth calendar quarter of 2001.
Should you elect not to accept this offer, ADC will provide registered common
shares prior to the end of ADC's fiscal third quarter.
ADC apologizes for the inconvenience this may represent to you, and sincerely
hopes that you will find this to be an acceptable compensation for the
accommodation we are requesting.
Anticipating your continued support, we are enclosing a new certificate for the
appropriate number of Series B shares. We request that you acknowledge receipt
of such shares, by executing the duplicate copy of this document below, and
returning it to ADC.
Thank you once again for your continued support.
0000 Xxxxx Xxxxx Xxxxx Xxx XX 00000 Phone 000.000.0000 Fax 000.000.0000
Sincerely,
/s/ Xxxxxx X. Xxxx
Xxxxxx X. Xxxx
Chief Executive Officer
AGREED AND ACCEPTED:
(Name)
(Date)
AGREEMENT
WHEREAS, Applied Data Communications, Inc., ("ADC" or "Borrower") requires
additional financing to capitalize on business opportunities, presently
available to it, and Xxxxxxx X. Xxxxxx ("Lender") is willing to provide such
financing ("Borrowing") under terms and conditions as set forth below,
NOW THEREFORE, ADC and Lender (collectively "Parties"), in exchange for the
foregoing and other good and valuable consideration, do hereby agree and
covenant as follows:
1. Amount of Borrowing.
Amount of the Borrowing shall be $300,000.
2. Rate, Fees.
Borrower shall compensate Lender with interest paid monthly, in the amount of 1%
per month, in addition to administrative fees paid monthly, in the amount of 1%
per month. Lender hereby grants to Borrower the right to pay interest and fees
in registered common shares of the Borrower's stock, valued at $.80 per share,
with said shares to be issued within thirty (30) days of payoff of the note.
Lender well permit Borrower to pay interest and fees in Series B preferred
shares, convertible to common shares at the exchange rate of 100 shares of
common stock for every share of Series B preferred stock. Such Series B
preferred shares will be adjusted upward to yield 20% more shares of common
stock, should Borrower be unable to provide registered shares in its place.
Lender will permit borrower to convert the note prior to its maturity date,
provided that the number of such shares paid for interest and fees will assume
the note was held to maturity.
3. Term, Prepayment.
The Borrowing shall commence on May 11, 2001 and shall be repayable in its
entirety on November 11, 2001. Said Borrowing may be repaid in whole or in
part, by the Borrower, without premium or penalty, at any time prior to the
Maturity Date, at the option of the Borrower, provided, however, that the Lender
shall be entitled to retain all options as defined under paragraph 4 hereunder,
regardless of whether borrowing is prepaid.
4. Additional Consideration.
Borrower shall grant Lender options to purchase 375,000 shares of registered
common stock of the Borrower, at a price of' $.80 per common share, such options
being available for a period of twenty-four months, commencing with the date of
this note. Options may not be exercised prior to January 1, 2002.
5. Legal and Collection Fees.
Xxxxxxxx agrees to compensate Lender for reasonable legal and collection fees
and expense incurred by Xxxxxx, in the event that Borrower is unable to repay
Borrowing when due.
6. Modification.
The terms of this Agreement shall not be varied, altered or modified except in
writing signed by the Borrower and the Lender.
7. Conversion.
Conversion of borrowings as defined hereunder, shall occur on or before November
11, 2001. Xxxxxx agrees to convert principal amount $300,000 to 375,000 shares
of the Borrower's "registered" common stock (price of $.80 per common share).
Lender will permit Borrower to convert said note into Xxxxxxxx's Series B
preferred shares, convertible to common shares at the exchange rate of 100
shares of common stock for every share of Series B preferred stock. Such Series
B preferred shares will be adjusted upward to yield 20% more shares of common
stock, adjusted to 450,000 common shares, should Borrower be unable to provide
registered common shares in its place.
Should Lender request conversion of this note to such shares of Series B
preferred stock, prior to maturity of the note, Lender will be entitled to
receive all of such interest and fee shares, per paragraph 2, herein, as/ if
such note were held to maturity.
Total shares, incl. Interest & fees (6 mos.) = 450,000 + 54,000
10. Validity Period.
This Agreement is valid for three weeks from the date hereof. All provisions
herein are subject to renegotiation after June 1, 2001.
11. Jurisdiction, Arbitration.
The provisions of this Agreement are to be construed according to, and are to be
governed by the laws of the State of California.
IN WITNESS WHEREOF, Parties acknowledge their agreement with the aforementioned
terms and conditions, by their signatures, as indicated below.
Applied Date Communications Inc.
By: /s/ Xxxxxx X. Xxxx /s/ Xxxxxxx X. Xxxxxx
Xxxxxx X. "Pat" Xxxx Xxxxxxx X. Xxxxxx, President-WILLPAR Inc.
Lender
WILLPAR Inc.
0000 Xxxxx Xxxxx Xxxxxx 0000 Xxxx Xx Xxxxx Xxx.
Santa Ana, CA 92704 Anaheim, CA 92807
Its Chief Executive Officer
Date: 5-18-01 Date: 5/30/01
AGREEMENT
WHEREAS, Applied Data Communications, Inc., ("ADC" or "Borrower") requires
additional financing to capitalize on business opportunities, presently
available to it, and Xxxxxxx X. Xxxxxx ("Lender") is willing to provide such
financing ("Borrowing") under terms and conditions as set forth below,
NOW THEREFORE, ADC and Lender (collectively "Parties"), in exchange for the
foregoing and other good and valuable consideration, do hereby agree and
covenant as follows:
1. Amount of Borrowing.
Amount of the Borrowing shall be $300,000.
2. Rate, Fees.
Borrower shall compensate Lender with interest paid monthly, in the amount of 1%
per month, in addition to administrative fees paid monthly, in the amount of 1%
per month. Lender hereby grants to Borrower the right to pay interest and fees
in registered common shares of the Borrower's stock, valued at $.80 per share,
with said shares to be issued within thirty (30) days of payoff of the note.
Lender will permit Borrower to pay interest and fees in Series B preferred
shares, convertible to common shares at the exchange rate of 100 shares of
common stock for every share of Series B preferred stock. Such Series B
preferred shares will be adjusted upward to yield 20% more shares of common
stock, should Borrower be unable to provide registered shares in its place.
Lender will permit borrower to convert the note prior to its maturity date,
provided that the number of such shares paid for interest and fees will assume
the note was held to maturity.
3. Term, Prepayment.
The Borrowing shall commence on March, 11, 2001 and shall be repayable in its
entirety on September 11, 2001. Said Borrowing may be repaid in whole or in
part, by the Borrower, without premium or penalty, at any time prior to the
Maturity Date, at the option of the Borrower, provided, however, that the Lender
shall be entitled to retain all options as defined under paragraph 4 hereunder,
regardless of whether borrowing is prepaid.
4. Additional Consideration.
Borrower shall grant Lender options to purchase 375,000 shares of registered
common stock of the Borrower, at a price of $.80 per common share, such options
being available for a period of twenty-four months, commencing with the date of
this note. Options may not be exercised prior to January 1, 2002.
5. Legal and Collection Fees.
Xxxxxxxx agrees to compensate Lender for reasonable legal and collection fees
and expense incurred by Xxxxxx, in the event that Borrower is unable to repay
Borrowing when due.
6. Modification.
The terms of this Agreement shall not be varied, altered or modified except in
writing signed by the Borrower and the Lender.
7. Conversion.
Conversion of borrowings as defined hereunder, shall occur on or before
September 11, 2001. Xxxxxx agrees to convert principal amount $300,000 to
375,000 shares of the Borrower's "registered" common stock (price of $.80 per
common share). Lender will permit Borrower to convert said note into Xxxxxxxx's
Series B preferred shares, convertible to common shares at the exchange rate of
100 shares of common stock for every share of Series B preferred stock. Such
Series B preferred shares will be adjusted upward to yield 20% more shares of
common stock, adjusted to 450,000 common shares, should Borrower be unable to
provide registered common shares in its place.
Should Lender request conversion of this note to such shares of Series B
preferred stock, prior to maturity of the note, Lender will be entitled to
receive all of such interest and fee shares, per paragraph 2, herein, as if such
note were held to maturity.
Pursuant thereto, total shares, including interest and fees (six months), under
the conversion option, would be the aforementioned 450,000 common shares, plus
54,000 shares for fees and interest, or a total of 504,000 (5,040 shares of
Series B Preferred Stock).
10. Validity Period.
All provisions herein are subject to renegotiation after June 1, 2001.
11. Jurisdiction, Arbitration
The provisions of this Agreement are to be construed according to, and are to be
governed by the laws of the State of California.
IN WITNESS WHEREOF, Parties acknowledge their agreement with the aforementioned
terms and conditions, by their signatures, as indicated below.
Applied Date Communications, Inc. Willpar, Inc.
By: /s/ Xxxxxx X. Xxxx /s/ Xxxxxxx X. Xxxxxx, Pres.
Lender
Xxxxxx X. "Xxx" Xxxx Xxxxxxx X. Xxxxxx
President President
0000 Xxxxx Xxxxx Xxxxxx 0000 Xxxx Xx Xxxxx Xxx.
Santa Ana, CA 92704 Anaheim, CA 92807
Date: March 11, 2001 Date: 3/11/01
ADC
APPLIED DATA COMMUNICATIONS
May 11, 2001
Xx. Xxxxxxx X. Xxxxxx
0000 Xxxx Xx Xxxxx Xxx
Xxxxxxx, XX 00000
Dear Xx. Xxxxxx:
Your note agreement with Applied Data Communications, Inc. ("ADC") provides for
the exchange of such note into registered shares of ADC's common stock in
quantity to include all principal, interest and fees, at the rate of one share
for every $.80 of such principal, fees and interest.
ADC has been endeavoring to implement such conversion for the past several
weeks. We have been advised by counsel that the specific shares we anticipated
using for this purpose, would no longer be considered as "registered". Although
the shares were considered as registered at one time, their reacquisition by an
"affiliate" of ADC, as defined, changes their status to that of unregistered
shares.
Consequently, ADC is currently unable to provide such shares, pursuant to our
obligation to you. Reflecting on this, and in discussions with Xx. Xxxxxx X.
Xxxxx, an advisor to the company, ADC is offering an alternative conversion
program which we believe will be beneficial to you.
ADC is offering to convert your note into ADC preferred stock, Series B, which
is convertible into common shares, at the rate of 100 shares of common for each
share of the Series B preferred stock, with voting privileges based on the
number of common shares into which the Series B preferred stock is convertible.
As Xxxxxx xxx have already have advised you, as a further acknowledgment of the
alteration this represents to your agreement, ADC is offering to adjust the
number of Series B preferred shares upward by 20%. This will provide to you an
additional 20% common shares, over that to which you would otherwise have
received. ADC will plan to convert such Series B shares to common shares, and to
register such shares within the fourth calendar quarter of 2001.
Should you elect not to accept this offer, ADC will provide registered common
shares prior to the end of ADC's fiscal third quarter.
ADC apologizes for the inconvenience this may represent to you, and sincerely
hopes that you will find this to be an acceptable compensation for the
accommodation we are requesting.
Anticipating your continued support, we are enclosing a new certificate for the
appropriate number of Series B shares. We would request that you acknowledge
receipt of such shares below, and returning same to ADC.
Thank you once again for your continued support.
0000 Xxxxx Xxxxx Xxxxx Xxx Xxxxxxxxxx 00000 Phone 000.000.0000
Fax 000.000.0000
Sincerely
/s/ Xxxxxx X. Xxxx
Xxxxxx X. Xxxx
Chief Executive Officer
AGREED AND ACCEPTED:
/s/ Xxxxxxx X. Xxxxxx
(Name)
5/11/01
(Date)
AGREEMENT
WHEREAS, Applied Data Communications, Inc., ("ADC" or Borrower") requires
additional financing to capitalize on business opportunities, presently
available to it, and Xxxxxxx X. Xxxxxx ("Lender") is willing to provide such
financing ("Borrowing") under terms and conditions as set forth below,
NOW THEREFORE, ADC and Lender (collectively "Parties"), in exchange for the
foregoing and other good and valuable consideration, do hereby agree and
covenant as follows:
1. Amount of Borrowing.
Amount of the Borrowing shall be $100,000.
2. Rate, Fees.
Borrower shall compensate Lender with interest paid monthly, in the amount of 1%
per month, in addition to administrative fees paid monthly, in the amount of 1%
per month. Lender hereby grants to Borrower the right to pay interest and fees
in registered common shares of the Borrower's stock, valued at $.80 per share,
with said shares to be issued within thirty (30) days of payoff of the note.
Lender will permit Borrower to pay interest and fees in registered common
shares, prior to maturity of the note, the number of such shares paid will
assume the note was held to maturity.
3. Term, Prepayment.
The Borrowing shall commence on April 26, 2001 and shall be repayable in its
entirety on October 26, 2001. Said Borrowing may be repaid in whole or in part,
by the Borrower, without premium or penalty, at any time prior to the Maturity
Date, at the option of the Borrower, provided, however, that the Lender shall be
entitled to retain all options as defined under paragraph 4 hereunder,
regardless of whether borrowing is prepaid.
4. Additional Consideration.
Borrower shall grant Lender options to purchase 125,000 shares of registered
common stock of the Borrower, at a price of $.80 per common share, such options
being available for a period of twenty-four months, commencing with the date of
this note.
5. Legal and Collection Fees.
Xxxxxxxx agrees to compensate Lender for reasonable legal and collection fees
and expense incurred by Xxxxxx, in the event that Borrower is unable to repay
Borrowing when due.
6. Modification.
The terms of this Agreement shall not be varied, altered or modified except in
writing signed by the Borrower and the Lender.
7. Conversion.
Conversion of borrowings as defined hereunder, shall occur on or before October
26, 2001. Xxxxxx agrees to convert principal amount $100,000 to 125,000 shares
of the Borrower" registered common stock (price of $.80 per common share).
10. Jurisdiction, Arbitration
The provisions of this Agreement are to be construed according to, and are to be
governed by the laws of the State of California.
IN WITNESS WHEREOF, Parties acknowledge their agreement with the aforementioned
terms and conditions, by their signatures, as indicated below.
Applied Date Communications, Inc.
By: /s/ Xxxxxx X. Xxxx /s/ Xxxxxxx X. Xxxxxx
Xxxxxx X "Pat" Xxxx Xxxxxxx X. Xxxxxx
Lender
0000 Xxxxx Xxxxx Xxxxxx 0000 Xxxx Xx Xxxxx Xxx.
Santa Ana, CA 92704 Anaheim, CA 92807
Its: Chief Executive Officer
Date: 4-26-01 Date: 5/1/01
