SECOND AMENDMENT TO REVOLVING LINE OF CREDIT AGREEMENT AND PROMISSORY NOTE
EXHIBIT
10.1
SECOND
AMENDMENT TO
REVOLVING
LINE OF CREDIT AGREEMENT AND PROMISSORY NOTE
This
Second Amendment to Revolving Line of Credit Agreement and Promissory Note (this
"Second Amendment") is entered into and effective as of June 19,
2009 (the "Effective Date") by and between Red Mile Entertainment, Inc.,
a Delaware corporation and its subsidiaries (collectively, the "Borrower") and
Tiger Paw Capital Corp., an Alberta Company (the "Lender").
RECITALS
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1.
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Borrower
and Lender are parties to a Revolving Line of Credit Agreement dated
February 11, 2008 (the "Credit Agreement") pursuant to which Borrower
issued to Lender a promissory note dated February 11,
2008 in the maximum principal sum of $1,000,000_00 (the "Promissory
Note"), secured by certain assets of Borrower pursuant to a Security
Agreement dated February 11, 2008 (the "Security
Agreement");
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2.
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In
connection with a proposed acquisition of Borrower by a third party that
did not take place, Borrower and Lender entered into a First Amendment to
Revolving Line of Credit Agreement and Promissory Note dated May 7, 2008
(the "First Amendment"), a Temporary Forbearance Agreement dated May 7,
2008 and an Amendment to Temporary Forbearance Agreement dated November 5,
2008 (collectively, the "Forbearance
Agreement").
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3.
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Borrower
and Lender now wish to further amend the Credit Agreement and Promissory
Note according to this Second
Amendment,
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AGREEMENT
NOW,
THEREFORE, in consideration of the foregoing premises, the mutual agreements set
forth below, and other good and. valuable consideration the parties agree as
follows:
1.
First
Amendment Forbearance Agreement
Superseded
This
Second Amendment terminates, replaces and supersedes the First Amendment and the
Forbearance Agreement in
their entirety, and the provisions of this Second Amendment shall apply
with respect to all events and periods of time occurring on or after the
Effective Date.
2.
Maturity Date
Unless
converted earlier pursuant to this Second Amendment, all outstanding principal
and accrued but unpaid interest under the Credit Agreement as of the Effective
Date, and all future advances and accrued interest, will be due and payable to
the order of Lender upon demand, but in no event later than the first
anniversary of the Effective Date (the "Final Maturity
Date").
1
3.
Conversion
Lender is
entitled, at its option, at any time after the Effective Date, to convert all or
any lesser portion of the then-outstanding principal and accrued but unpaid
interest into shares of Borrower's common stock (the "Conversion Shares") at a
conversion price (the "Conversion Price") for each share of common stock equal
to the average closing bid price for the common stock for the three trading days
before the Conversion Date (as defined below). The closing bid price shall be
the closing bid price of the Borrower's common stock as reported in the
over-the-counter market or, if such common stock is then listed on another stock
market or exchange, the closing bid price on such exchange as reported in the
Wall Street Journal. Lender may effect conversion by surrendering the Promissory
Note to the Borrower, with the form of conversion notice attached hereto as
Exhibit
A (the "Conversion Notice"), executed by Lender.
Borrower
will not be obligated to issue fractional Conversion Shares upon conversion;
instead, Borrower will round the number of Conversion Shares up to the nearest
whole share. The effective date of the conversion (the "Conversion Date") shall
be the date on which the executed Conversion Notice is first received by
Borrower, by facsimile transmission or otherwise. Lender shall deliver the
Promissory Note, together with the original executed Conversion Notice, to
Borrower within three business days after the Conversion Date.
On the
Final Maturity Date, Borrower will pay any unconverted principal and accrued
interest, at the option of the Borrower, in either (a) cash or (b) common stock
valued at a price equal to the Conversion Price determined as
if the Promissory Note was converted into common stock on the Final
Maturity Date in accordance with the terms of the Promissory Note and this
Second Amendment.
4.
Other
Terms Unaffected
Except as
expressly modified by the provisions hereof, the Credit Agreement, the
Promissory
Note, and the Security Agreement are in all respects ratified and confirmed, and
shall continue
in full force and effect in accordance with their respective terms. To the
extent that there are
any inconsistencies between this Second Amendment, on the one hand, and the
Credit Agreement,
Promissory Note or Security Agreement, on the other hand, the terms and
provisions of this
Second Amendment shall prevail.
5. Counterparts
This
Second Amendment may be executed in one or more counterparts (including by
facsimile) each of which when so executed will be deemed an original and all of
which, when taken together, will constitute one and the same
agreement.
[Signatures
on
following page]
2
IN
WITNESS WHEREOF, the parties have executed this Second AMENDMENT AS OF THE
Effective Date.
RED
MILE ENTERTAINMENT,
INC. TIGER
PAW CAPITAL , CORP.
By: /s/
Xxxxx
Xxxxx By:/s/
Xxxxx
Xxxxxx
Name:
Xxxxx
Xxxxx Name:
Xxxxx Xxxxxx
Title:
CEO Title:
Principal
3
EXHIBIT
A
CONVERSION
NOTICE
The
undersigned hereby elects to convert $ of
the principal and $ of
the accrued but unpaid interest due on the Promissory Note (the"Note")
issued by Red Mile Entertainment, Inc. (the "Borrower") on February 11, 2008
pursuant to the terms of the Note, the Revolving Line of Credit Agreement
between Borrower and TigerPaw Capital Corp. dated February I I, 2008, and the
Second Amendment to Revolving Line of Credit Agreement and Promissory Note dated
June 19
2009.
Date:
Signature:
Print
Name:
Title:
