EXHIBIT 15
SECOND AMENDMENT AND FORBEARANCE AGREEMENT
This Second Amendment and Forbearance Agreement (the "Second Amendment") is
entered into as of August 14, 2002 by and between Chapeau, Inc., a Utah
corporation d/b/a Blue Point Energy Products, Inc. (the "Company") and the
undersigned individual or entity whose name appears on the signature page hereto
("Holder"). The Company and Holder may be referred to herein by the term
"party" or "parties" in this Second Amendment where and whenever necessary,
RECITALS
WHEREAS, the Company has executed a convertible promissory note in favor of
Holder in the aggregate original principal amount set forth on the signature
page attached hereto (the "Note"); and
WHEREAS, the Company and Holder entered into that certain Amendment and
Forbearance Agreement (the "First Amendment"), pursuant to which the Company
agreed to issue additional shares of Common Stock to Holder in consideration for
extending the maturity date of the Note to the date set forth in such First
Amendment;
WHEREAS, the Company is in default under the Note due to the Company's
failure to pay the outstanding obligations under the Note on or prior to such
maturity date; and
WHEREAS, pursuant to Section 14 of the Note, the parties wish to amend the
Note to provide for a maturity date of February 2, 2003 in consideration for the
agreements contained below;
NOW THEREFORE, for good and valuable consideration and intending to be
legally bound, the parties hereby agree as follows:
AGREEMENT
1. Definitions. Capitalized terms used herein, unless otherwise defined
in this Second Amendment shall have the meanings set forth in the Note, as
amended by the First Amendment. References to the "Note" in this Second
Amendment, shall mean the Note, as amended by the First Amendment.
2. Amendment of Definitions in the Note .
(a) Definition of Maturity Date. The definition of "Maturity Date" in
Section 1 of the Note is hereby amended in its entirety to read as follows:
"Maturity Date" means February 2, 2003."
(b) Definition of Basic Rate. The definition of "Basic Rate" in Section 1
of the Note is hereby amended in its entirety to read as follows:
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"Basic Rate" means a per annum fixed interest rate of ten percent (10.0%).
3. Amendment of Section 2 of the Note. Section 2 of the Note is hereby
amended in its entirety to read as follows:
"Subject to the provisions of this Note hereinafter set forth, the entire
Principal Balance shall bear interest from the date of the First Amendment at
the Basic Rate of ten percent (10%) per annum, calculated for the actual number
of days elapsed, on the basis of a 360-day year. The Principal Balance and all
accrued interest thereon shall be due and payable on the Maturity Date. If any
payment hereunder would otherwise be due on a day that is not a business day, it
shall instead be due on the next succeeding business day, and such extension of
time shall be taken into account in all calculations of interest due hereunder.
If the Company does not pay any amount due hereunder within a ten (10) day
period after the Maturity Date, such failure to pay shall constitute an "Event
of Default" under this Note."
4. Fee. In addition to any success fee set forth in the Note or the
First Amendment, Holder shall receive that number of fully paid and
nonassessable shares of Common Stock of the Company as calculated in this
Section 4. The number of shares of Common Stock to which Holder shall be
entitled shall equal the Principal Balance under the Note as of the date of this
Second Amendment divided by $1.00 per share. By way of example, if the
Principal Balance is $300,000, Holder will receive 300,000 shares [($300,000
divided by $1.00/share) = 300,000 shares].
5. Forbearance and Waiver. In consideration of the covenants and
agreements set forth herein, Holder hereby knowingly and voluntarily (i) waives
any Event of Default under the Note existing as of the date of this Second
Amendment, (ii) waives any damages to which (s)he (it) would otherwise be
entitled under the terms of the Note and the other documents executed in
connection therewith and (iii) agrees to refrain and forbear in the exercise of
its rights and remedies with respect to any failure of the Company to make any
payments under the Note prior to the Maturity Date.
6. Warranty of Entire Interest. Each party hereto warrants that no other
person or entity has any interest in the claims referred to herein, except as
may otherwise be stated, and that (s)he (it) (they) has (have) not sold,
assigned, transferred, conveyed, or otherwise disposed of any of the claims,
demands, obligations, or causes of action to which this Second Amendment refers.
7. Arms-Length Negotiation. This Second Amendment is the product of
informed negotiations between parties of equal bargaining power, and involves
compromises of the patties' previously stated legal positions or rights. This
Second Amendment forms the basis for significant legal rights and obligations of
the parties executing it. Each party executing this Second Amendment
acknowledges by such execution that (s)he (it) has read this Second Amendment,
been afforded the opportunity to seek legal counsel, and has either obtained
separate legal representation or waived her (his) (its) right to do so.
8. References to the Note. On and after the effective date of this
Second Amendment, each reference in the Note or the other documents executed in
connection therewith (including, without limitation the Security Agreement and
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the Subscription Agreement) to "the Note," "this Note," or words of like import
referring to the Note, shall refer to the Note as amended by the First Amendment
and this Second Amendment. The Note, as amended, is and shall continue to be in
full force and effect and is hereby in all respects ratified and confirmed.
9. Miscellaneous.
(a) Additional Documents. All parties agree to cooperate fully and
execute any and all supplementary documents and to take all additional actions
which may be necessary or appropriate to give full force and effect to this
Second Amendment.
(b) Construction of this Second Amendment. Each party, having
reviewed and discussed this Second Amendment thoroughly, agrees that any
question of construction shall not be resolved by any rule of interpretation
providing for interpretation against the drafting party, and that any ambiguity
shall not be assumed by a court of competent jurisdiction to be construed for or
against any specific party to this Second Amendment.
(c) No Waiver. No waiver of any provision of this Second Amendment,
or of any rights or obligations of any parry to it, shall be effective, except
pursuant to a written instrument signed by the party or parties waiving
compliance. Any such waiver shall be effective only in the specific instance
and for the specific purpose so stated in such a writing.
(d) Governing Law. The laws of the State of Nevada shall govern the
interpretation and application of this Second Amendment, without reference to
such State's principles of conflicts of law.
(e) Integration. The Note, the First Amendment and this Second
Amendment constitute the entire agreement of the parties with respect to the
subject matter hereof, and supersede all prior discussions, agreements and
understandings, whether written or oral, between the parties with respect
hereto.
(f) Amendment; Severability. This Second Amendment may only be
modified, amended, or otherwise altered by a written instrument mutually signed
by all parties. If any provision or clause of this Second Amendment is held
unenforceable by a court of competent jurisdiction, such a finding shall not
impair the validity or enforceability of this Second Amendment's remaining
provisions.
(g) Authority. All parties warrant and represent that they are
authorized to enter into this Second Amendment on their own behalf and on behalf
of their respective directors, officers, employees, agents, current or former
subsidiaries, divisions, affiliates, predecessors-in-interest, successors in-
interest, assigns, and all persons or entities acting through or under any of
them, and that they have the legal authority to bind such persons and entities
to this Second Amendment's terms. The parties also represent and warrant that
the person whose signature is affixed to this document on behalf of each
respective party is authorized to sign this Second Amendment on behalf of the
respective party and has the legal authority to so bind that party.
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(h) Counterparts. This Second Amendment may be executed in several
counterparts, each of which shall be deemed an original, but all of which shall
constitute one and the same instrument. Delivery of an executed counterpart of
the signature page to this Second amendment by facsimile shall be effective as
delivery of a manually executed counterpart of this Second Amendment.
(i) Attorney Fees. Each party hereto shall bear its own attorneys'
fees and costs incurred in connection with this Second Amendment.
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IN WITNESS WHEREOF, the parties have executed this Second Amendment as of
the date and year first above written.
"COMPANY"
CHAPEAU, INC.
By: _____________________________
Xxx X. Xxxxxxxx,
Chief Executive Officer
Address:
Chapeau, Inc.
0000 Xxxxxxxx Xxxx
Xxxxxxx Xxx, Xxxxxxxxxx 00000.
Attention: Xxx X. Xxxxxxxx,
Chief Executive Officer
"HOLDER"
________________________________
Signature
________________________________
Print Name (and title, if applicable)
Address:
_____________________________
_____________________________
_____________________________
Principal Amount of Note:
$_____________________
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