EXHIBIT 10.2
AMENDED AND RESTATED DEBT AGREEMENT
Date: April 2nd, 2005
Principal Amount: $276,679.45 USD
This AMENDED AND RESTATED DEBT AGREEMENT is entered into on the 2nd day of
April, 2005, by and between XXXX X. ROCKER, an individual, ADDRESS ("Creditor or
"Rocker"") and IP PROMOTIONS, INC, a Nevada Corporation, 0000 Xxxxx Xxxx Xx.,
Xxxxxxx, Xx. 00000 (DEBTOR ADDRESS), ("Debtor" or "IP").
WHEREAS, Rocker had lent to IP PROMOTIONS, LLC, a Georgia LLC, ("IP
GEORGIA") the sum of two hundred seventy-six thousand six hundred seventy-nine
dollars and 45 cents ($ 276,679.45 USD), subject to certain terms and conditions
set forth in an unsigned, yet mutually agreed upon promissory note hereby
attached as Schedule A.
WHEREAS, IP GEORGIA and IP entered into an Asset Purchase Agreement on
March 10th, 2005 in which IP purchased certain assets from IP GEORGIA by
assuming certain liabilities of IP GEORGIA. A copy of the Asset Purchase
Agreement is hereby attached as Schedule B.
WHEREAS, pursuant to the Asset Purchase Agreement, IP expressly assumed
the debt by and between Rocker and IP GEORGIA.
WHEREAS, Rocker and IP now wish to amend and restate the terms of the
debt now owed by IP to Rocker.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by each of the parties hereto, the
parties hereby agree that he debt between both parties is hereby revised and
restated as follows:
1. ACKNOWLEDGMENT OF RESTATED DEBT AGREEMENT. IP and Rocker both
acknowledge that this agreement supersedes any and all prior agreements related
to the debt owed by IP to Rocker.
2. TERMS OF DEBT. The Creditor and Debtor hereby acknowledge that on
the date of this agreement, the Debtor owes the Creditor hereof the principal
amount of two hundred seventy-six thousand six hundred seventy-nine dollars and
45 cents ($276,679.45) USD based on the terms and conditions set forth below
(the "Debt"). The principal amount of the Debt, plus all accrued and unpaid
interest on the Debt, as set forth, below shall be due and payable by the Debtor
on the day before the second anniversary of the execution of this Agreement (the
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"Maturity Date"). There shall be no prepayment penalty in the event that the
Debtor chooses to pay any principal and accrued interest on the debt prior to
the Maturity Date. Interest shall accrue only on the outstanding principal and
accrued interest until the Loan is repaid in full.
3. INTEREST. The Debt shall incur interest at the rate of ten Percent
(10%) per annum ("Interest") until the Debt is repaid in full. Interest on the
Debt shall accrue and become due and payable on the last day of each month; any
unpaid interest shall be added to the outstanding principal balance.
4. RIGHTS OF CONVERSION. The Creditor may, at his sole option and
discretion, elect to convert all or a portion of the Debt for common shares of
IP pursuant to the following terms and conditions
(a) The Creditor has the right to convert all, or a portion of the
Debt owed and due to common shares of the Debtor at the
conversion rate of one share per $1.00 of Debt owed and due.
(b) In order to convert, the Creditor must mail a written notice
to IP Promotions, Inc., 0000 Xxxxx Xxxx Xxxxx, Xxxxxxx, Xx.
00000 Attn: Chief Executive Officer, specifically stating the
amount of debt to be converted to shares. The notice must be
mailed at least 15 days prior to conversion.
(c) Neither this Agreement nor the Shares to be issued upon
conversion have been registered under the Securities Act of
1933, as amended ("Securities Act"), or any state securities
laws ("Blue Sky Laws"). Those shares acquired upon conversion
are to be acquired for investment purposes and not with a view
to distribution or resale and may not be pledged,
hypothecated, sold, made subject to a security interest, or
otherwise transferred without (i) an effective registration
statement of the shares under the Securities Act and all
applicable Blue Sky Laws, or (ii) an opinion of counsel, which
opinion and counsel shall be reasonably satisfactory to the
Company and its counsel, that registration is not required
under the Securities Act or under any applicable Blue Sky
Laws. Any shares issued upon conversion shall bear the same or
a substantially similar legend as follows:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN
ISSUED IN RELIANCE UPON THE REPRESENTATION OF THE HOLDER THAT
THEY HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW
TOWARD THE RESALE OR OTHER DISTRIBUTION THEREOF, AND HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "FEDERAL
ACT") OR THE SECURITIES LAWS OF ANY STATE IN RELIANCE UPON THE
EXEMPTIONS FROM REGISTRATION CONTAINED THEREIN, AND MAY NOT BE
OFFERED, SOLD, TRANSFERRED, ENCUMBERED OR OTHERWISE DISPOSED
OF UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE FEDERAL ACT AND APPLICABLE STATE SECURITIES LAWS RELATING
THERETO OR THE COMPANY IS SATISFIED REGISTRATION IS NOT
REQUIRED.
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The Creditor hereof and the Debtor agree to execute all other
documents and instruments as counsel for the Creditor
reasonably deems necessary to effect the compliance of the
issuance of the shares of Common Stock upon conversion with
respect to applicable federal and state securities laws.
(d) Any rights under this agreement may not be transferred etc.
5. REPRESENTATIONS AND WARRANTIES. The Debtor represents and
warrants as follows:
(a) The Debtor is a corporation duly organized, validly existing
and in good standing under the laws of the State of Nevada.
The Debtor has the corporate power to own its properties and
to carry on its business as now being conducted.
(b) The Debtor has all requisite corporate power and authority to
enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this
Agreement and the consummation of the transactions
contemplated hereby have been duly authorized by all necessary
corporate action on the part of the Debtor. The Debtor's Board
of Directors has approved this Agreement and the transactions
contemplated hereby. This Agreement has been duly executed and
delivered by the Debtor and constitutes a valid and binding
obligation of the Debtor, enforceable in accordance with its
terms, except (a) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of
general application affecting enforcement of creditors' rights
generally and (b) as limited by laws relating to the
availability of specific performance, injunctive relief or
other equitable remedies
(c) This Agreement is the legal, valid and binding obligation of
the Debtor, except as limited by applicable bankruptcy,
insolvency, and other similar laws affecting creditors' rights
generally.
6. REPRESENTATIONS AND WARRANTIES. The Creditor represents and
warrants as follows:
(a) That the Creditor has knowledge and experience in financial
and business matters and that he understands that the merits
and risks associated with the execution of this Agreement and
that the Creditor is an "Accredited Investor" as that term is
defined under Rule 501 of Regulation D of the Securities Act
of 1933.
(b) This Agreement is the legal, valid and binding obligation of
the Creditor.
7. EVENTS OF DEFAULT.
(a) In the "Event of Default" as that term is described in 7(b),
the total amount under due under this Agreement shall become
immediately due and payable.
(b) The term, "Event of Default" shall constitute the following
scenarios;
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(1) The Debtor is unable to pay back the Loan plus
Interest on the "Maturity Date".
(2) If the Debtor shall make an assignment for the
benefit of creditors or shall admit in writing its
inability to pay its debts as they become due; or
(3) If the Debtor shall file a voluntary petition in
bankruptcy, or shall be the subject of an involuntary
bankruptcy petition, or adjudicated bankrupt or
insolvent, or shall file any petition or answer
seeking any reorganization arrangement, composition,
readjustment, liquidation, dissolution, or similar
relief under the present or any future Federal
Bankruptcy Code or other applicable federal, state or
similar statute, law or regulation, or shall seek or
consent to or acquiesce in the appointment of any
trustee, receiver or liquidator of the Debtor or of
all or any substantial part of its assets.
8. NOTICES. All notices, requests or instructions hereunder shall be in
writing and delivered personally or sent by FedEx mail or similar overnight
delivery, postage prepaid, as follows:
IF TO CREDITOR: Xxxx Xxxxxx
0000 Xxxxx Xxxx Xxxxx
Xxxxxxx, Xx. 00000
Attn:
IF TO DEBTOR: IP Promotions, Inc.
0000 Xxxxx Xxxx Xxxxx
Xxxxxxx, Xx. 00000
Attn: Chief Executive Officer
Or to such other address as a party hereto may designate by notice
given to the other parties hereto pursuant to this paragraph.
Any notice so addressed and mailed, shall be deemed to be given when so
mailed. Any of the above addresses may be changed at any time by notice given as
provided above; provided, however, that any such notice of change of address
shall be effective only upon receipt.
9. CHOICE OF LAW. This agreement is made in and shall be governed by
and construed in accordance with the laws of the State of Nevada.
10. WAIVERS. The Debtor hereby waives presentment, demand for
performance, notice of non-performance, protest, notice of protest and notice of
dishonor. No delay on the part of Creditor in exercising any right hereunder
shall operate as a waiver of such right or any other right.
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11. NO CHANGES. This Agreement may not be changed or terminated orally,
but only by an agreement in writing signed by the party against whom enforcement
of any change, modification, termination, waiver, or discharge is sought. This
Agreement is being delivered in and shall be construed in accordance with the
laws of the State of Nevada, without regard to the conflicts of laws provisions
thereof.
12. ENTIRE AGREEMENT. This Agreement, including all exhibits and
schedules attached thereto, executed on even date herewith, constitutes the full
and entire understanding and agreement between the parties with regard to the
Debt, and no party shall be liable or bound to any other party in any manner by
any representations, warranties, covenants and agreements.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first above written.
CREDITOR:
By: /S/ Xxxx Xxxxxx
-------------------
Name: Xxxx Xxxxxx
DEBTOR:
IP Promotions, Inc., a Nevada Corporation.
By: /S/ Xxxxxxx Xxxxxxx
-----------------------
Name: Xxxxxxx Xxxxxxx
Title: Chief Executive Officer
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