EXHIBIT 10.37
FORM OF FIRST AMENDMENT TO LOAN AGREEMENT,
NOTE AND WARRANT BETWEEN THE COMPANY AND
THE LENDERS IDENTIFIED ON THE
ATTACHED
FIRST AMENDMENT TO
LOAN AGREEMENT, NOTE
AND
WARRANT
ONTRO, INC.
AND
XXXX XXXXXXX
FIRST AMENDMENT TO
LOAN AGREEMENT, NOTE AND WARRANT
This First Amendment to Loan Agreement, Note and Warrant amends that
certain Loan Agreement dated January 10, 1997 (the "Agreement") by and between
ONTRO, INC. ("Ontro") and XXXX XXXXXXX, is made effective this 31st day of
January, 1998, by and through the authority vested in the Board of Directors of
Ontro by resolution dated January 27, 1998.
1. The second and third sentence of Section 1.2 of the Agreement are hereby
amended to read in their entirety as follows:
The exercise price of the Warrant shall be Three Dollars ($3.00) per
share. The Warrant shall be exercisable by the Lender at any time during the
period from the date of the Note until Twenty Four (24) months from the date
the Note is paid in full or fully converted to Ontro common stock.
2. A new Section 1.3 shall be added which shall read as follows:
1.3 Borrower's Note Conversion Rights. The Company and Lender agree
the Company shall have the right, in it's sole and absolute
discretion, to convert the amounts due pursuant to this Note into
shares of Ontro, Inc. common stock at any time. Upon the Company's
election to convert all or a portion of this Note, the number of
shares of Ontro, Inc. common stock this Note shall be converted into
shall be determined by dividing the amount of principal and accrued
interest due pursuant to this Note and to be converted on the date of
conversion by the Conversion Price (as hereinafter defined).
1.3.1 Conversion Price. The Conversion Price shall be
the lesser of: (i) the last cash price received by the Company from
the sale of its common stock in an arms length transaction with an
unrelated third party; or (ii) Five and 50/100 Dollars ($5.50) per
share.
1.3.2 Manner of Conversion. The Company may convert
this Note, provided the Company satisfies the following conditions:
1.3.2.1 Written notice is provided to Lender
evidencing the Company's election to convert all or a portion of the
amounts due under this Note, and such notice is sent via facsimile
transmission or written notice to Lender. Such conversion shall be
deemed to have been effected immediately prior to the close of
business on the day on which such conversion request shall have been
received. Upon the date conversion is effected the rights of Lender
to receive principal and interest pursuant to this Note for the
amounts converted shall cease, and Lender shall be treated for all
purposes as the record shareholder of such securities as are to be
issued to Lender in conversion of all or a portion of this Note.
1.3.2.2 The Company delivers to Lender certificates or
other instruments evidencing ownership by Lender of the number of
shares of the Company's common stock the amounts due under the Note
may be converted into as provided in paragraph 1.3.1 hereinabove,
along with a new Promissory Note to reflect the reduced amount due in
the event the Company does not elect to convert all of the Note. No
fractional
securities will be issued in connection with any conversion under this
Note, but in lieu of such fractional securities, the Company shall make
a cash refund therefor equal in amount to the product of the applicable
fraction multiplied by the Conversion Price.
1.3.2.3 Upon receipt by Lender of the certificates
referenced in paragraph 1.3.2.2 hereinabove, this Convertible
Promissory Note shall be deemed cancelled and paid in full. In the
event the Company elects to convert only a portion of the principal
and interest due pursuant to the Note, the Company shall deliver the
certificates evidencing the number of shares such amounts were
converted into, along with a new Promissory Note in favor of Lender
for the amounts due which were not converted.
1.3.3 Converted Shares Subject to Lock Up. The shares
of the Company's common stock issued to Lender in conversion of the
Note shall be subject to the lock-up agreement signed by the Lender.
1.3.4 Restricted Shares Upon Conversion. The shares of
the Company's common stock issued to Lender in conversion of the Note
shall be "restricted securities" as defined in Sections 4.6 and shall
be subject to the limitations and legend conditons as set forth in
Sections 4.7 through 4.10 of the Agreement.
3. The Promissory Note attached to the Loan Agreement as Exhibit "A" is hereby
amended to reflect the amended terms as set forth herein.
4. The Warrant attached to the Loan Agreement as Exhibit "B" is hereby amended
to reflect the amended terms as set forth herein.
ONTRO, INC.
A CALIFORNIA CORPORATION
BY:
---------------------------
XXXXX X. XXXXXXX, PRESIDENT
-------------------------------
XXXX XXXXXXX
SCHEDULE "A"
J. Xxxxx Xxxxxx
4D Enterprises, Inc.
Xxxxxx Xxxxxx Xxxxxxxx and Xxxxxxxxxx Xxxxxx Xxxxxxxx, Trustees of the
Xxxxxx Xxxxxx Xxxxxxxx and Xxxxxxxxxx Xxxxxx Xxxxxxxx Joint Revocable Trust
dated June 23, 0000
Xxxxxxxxx Xxxx, Inc.
Xxxxx X. Xxxxxxx
Mirage Collection, Inc.
Moncreiff Capital Corporation
Norbury Foundation
Securities Advisory Board
Xxxx Xxxxxxx
Xxxxx Xxxxxxx
Xxxx Xxxxxxx
