NOTE PURCHASE AGREEMENT
EXHIBIT
10.1
NOTE PURCHASE AGREEMENT (this
“Agreement”),
dated as of January 6, 2009, by and between VALCOM, INC., a Delaware corporation
(the “Company”),
and OMNIRELIANT HOLDINGS, INC., a Nevada corporation (the “Investor”).
A. The
Company wishes to sell to Investor, and Investor wishes to purchase, upon the
terms and subject to the conditions set forth in this Agreement, a Secured
Convertible Promissory Note, which shall accrue interest at the rates set forth
in the Secured Convertible Promissory Note, and which are attached hereto as
Exhibit A
(the “Note”).
B. The
Company’s obligations under the Note, including without limitation its
obligation to make payments of principal thereof and interest thereon, are
secured by the assets of the Company, pursuant to the terms of a Security
Agreement in the form attached hereto as Exhibit B
(the “Security
Agreement”).
In
consideration of the mutual promises made herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Company and each Investor hereby agree as follows:
1. PURCHASE
AND SALE OF NOTES.
1.1 Closing.
Upon the
terms and subject to the satisfaction or waiver of the conditions set forth
herein, the Company agrees to sell and Investor agrees to purchase a Note with a
principal amount of $100,000. The date on which the closing of such
purchase and sale occurs (the “Closing”)
is hereinafter referred to as the “Closing
Date”. The Closing will be deemed to occur at the offices of Sichenzia
Xxxx Xxxxxxxx Xxxxxxx LLP, 00 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx, or such other place
as the parties mutually agree upon, when (A) this Agreement and the other
Transaction Documents (as defined below) have been executed and delivered by the
Company and Investor, (B) each of the conditions to the Closing described in
this Agreement has been satisfied or waived as specified therein and (C) payment
of Investor’s Purchase Price (as defined below) payable with respect to the Note
being purchased by Investor at the Closing has been made by wire transfer of
immediately available funds. At the Closing, the Company shall
deliver to Investor a duly executed instrument representing the Note purchased
by such Investor at the Closing.
1.2 Certain
Definitions. When used herein, the following terms shall have
the respective meanings indicated:
“Affiliate”
means, as to any Person (the “subject
Person”), any other Person (a) that directly or indirectly through
one or more intermediaries controls or is controlled by, or is under direct or
indirect common control with, the subject Person, (b) that directly or
indirectly beneficially owns or holds ten percent (10%) or more of any class of
voting equity of the subject Person, or (c) ten percent (10%) or more of
the voting equity of which is directly or indirectly beneficially owned or held
by the subject Person. For the purposes of this definition, “control”
when used with respect to any Person means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, through representation on such Person’s board of
directors or other management committee or group, by contract or
otherwise.
“Board of
Directors” means the Company’s board of directors.
“Business
Day” means any day other than a Saturday, a Sunday or a day on which the
Principal Market is closed or on which banks in the City of New York are
required or authorized by law to be closed.
“Closing”
and “Closing
Date” have the respective meanings specified in Section
1.1 of this Agreement.
“Commission”
means the Securities and Exchange Commission, and any successor regulatory
agency.
“Common
Stock” means the common stock of the Company, $0.001 par value per
share.
“Company
Subsidiary” means any Subsidiary of the Company.
“Disclosure
Documents” means all SEC Documents filed with the Commission at least
three (3) Business Days prior to the Execution Date.
“Environmental
Law” means any federal, state, provincial, local or foreign law, statute,
code or ordinance, principle of common law, rule or regulation, as well as any
Permit, order, decree, judgment or injunction issued, promulgated, approved or
entered thereunder, relating to pollution or the protection, cleanup or
restoration of the environment or natural resources, or to the public health or
safety, or otherwise governing the generation, use, handling, collection,
treatment, storage, transportation, recovery, recycling, discharge or disposal
of hazardous materials.
“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended, and the
regulations and published interpretations thereunder.
“Event of
Default” has the meaning specified in the Notes.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended (or any
successor act), and the rules and regulations promulgated thereunder (or
respective successors thereto).
“Execution
Date” means the date of this Agreement.
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“GAAP”
means U.S. generally accepted accounting principles, applied on a consistent
basis. Accounting principles are applied on a “consistent basis” when
the accounting principles applied in a current period are comparable in all
material respects to those accounting principles applied in a preceding
period.
“Governmental
Authority” means any nation or government, any state, provincial or
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government,
including, without limitation, any stock exchange, securities market or
self-regulatory organization.
“Governmental
Requirement” means any law, statute, code, ordinance, order, rule,
regulation, judgment, decree, injunction, franchise, license or other directive
or requirement of any federal, state, county, municipal, parish, provincial or
other Governmental Authority or any department, commission, board, court, agency
or any other instrumentality of any of them.
“Lien”
means, with respect to any Property, any lien, mortgage, pledge, hypothecation,
assignment, security interest, charge, easement or other
encumbrance.
“Material Adverse
Effect” means an effect that is material and adverse to (i) the
consolidated business, properties, assets, operations, results of operations,
financial condition, credit worthiness or prospects of the Company and the
Company Subsidiary taken as a whole, (ii) the ability of the Company or any
Company Subsidiary to perform its material obligations under this Agreement or
the other Transaction Documents or (iii) the rights and benefits to which an
Investor is entitled under this Agreement or any of the other Transaction
Documents.
“Material
Contracts” means, as to the Company and the Company Subsidiary, any agreement required pursuant to Item 601 of Regulation
S-B or Item 601 of Regulation S-K, as applicable, promulgated under the
Securities Act to be filed as an exhibit to any report, schedule,
registration statement or definitive proxy statement filed or required to be
filed by the Company with the Commission under the Exchange Act or any rule or
regulation promulgated thereunder, and any and all material amendments,
modifications, supplements, renewals or restatements thereof.
“New
Securities” means, any Common Stock or Common Stock Equivalents that the
Company proposes to offer or sell for cash consideration at any time during the
period from the Closing Date through the later of the first anniversary of the
Effective Date or two years from the Closing Date, (the latter shall mean the
“Subsequent
Financing”).
“Pension
Plan” means an employee pension benefit plan (as defined in ERISA)
maintained by the Company for employees of the Company or any of its
Affiliates.
“Person”
means any individual, corporation, trust, association, company, partnership,
joint venture, limited liability company, joint stock company, Governmental
Authority or other entity.
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“Principal
Market” means the American Stock Exchange or the principal exchange,
market or quotation system on which the Common Stock is then listed, traded or
quoted.
“Property”
means property and/or assets of all kinds, whether real, personal or mixed,
tangible or intangible (including, without limitation, all rights relating
thereto).
“Purchase
Price” means, with respect to the Notes purchased at the Closing, the
original principal amount of the Note purchased at the Closing.
“SEC
Documents” means all reports, schedules, registration statements and
definitive proxy statements filed (or required to be filed) by the Company with
the Commission.
“Securities
Act” has the meaning specified in the recitals of this
Agreement.
“Subsidiary”
means, with respect to any Person, any corporation or other entity of which at
least a majority of the outstanding shares of stock or other ownership interests
having by the terms thereof ordinary voting power to elect a majority of the
board of directors (or Persons performing similar functions) of such corporation
or entity (regardless of whether or not at the time, in the case of a
corporation, stock of any other class or classes of such corporation shall have
or might have voting power by reason of the happening of any contingency) is at
the time directly or indirectly owned or controlled by such Person or one or
more of its Subsidiary or by such Person and one or more of its
Subsidiary.
“Transaction
Documents” means (i) this Agreement, (ii) the Note, (iii) the Security
Agreement, and (iv) all other agreements, documents and other instruments
executed and delivered by or on behalf of the Company or any of its officers at
the Closing.
1.3 Other Definitional
Provisions. All definitions contained in this Agreement are
equally applicable to the singular and plural forms of the terms
defined. The words “hereof”, “herein” and “hereunder” and words of
similar import contained in this Agreement refer to this Agreement as a whole
and not to any particular provision of this Agreement.
2. REPRESENTATIONS
AND WARRANTIES OF INVESTOR.
Investor (with respect to itself only)
hereby represents and warrants to the Company and agrees with the Company that,
as of the Execution Date:
2.1 Authorization;
Enforceability. Such Investor is duly and validly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation or organization as set forth below such Investor’s name on the
signature page hereof with the requisite corporate power and authority to
purchase the Note to be purchased by it hereunder and to execute, deliver and to
consummate the transactions contemplated by, this Agreement and the other
Transaction Documents to which it is a party and otherwise to carry out its
obligations thereunder. This Agreement constitutes, and upon execution and
delivery thereof, each other Transaction Document to which such Investor is a
party will constitute, such Investor’s valid and legally binding obligation,
enforceable in accordance with its terms, subject to (i) applicable bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium or other similar
laws of general application relating to or affecting the enforcement of
creditors’ rights generally and (ii) general principles of equity.
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2.2 No Conflicts. The execution and performance of this
Agreement and the other Transaction Documents to which it is a party do not
conflict in any material respect with any agreement to which such Investor is a
party or is bound, any court order or judgment applicable to such Investor, or
the constituent documents of such Investor.
2.3 Fees. Such Investor
has not agreed to pay any compensation or other fee, cost or related expenditure
to any underwriter, broker, agent or other representative in connection with the
transactions contemplated hereby.
2.4. Accredited Investor.
As the date hereof, the Investor warrants that it is either: (i) an “accredited
investor” as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under
the Securities Act or (ii) a “qualified institutional buyer” as defined in Rule
144A(a) under the Securities Act. Such Purchaser is not required to be
registered as a broker-dealer under Section 15 of the Exchange Act.
2.5. Restricted
Securities. The Note may only be disposed of in compliance with state and
federal securities laws.
The
Purchasers agree to the imprinting, so long as is required by this Section 2.5,
of a legend on any of the Securities in the following form:
THESE SECURITIES HAVE BEEN REGISTERED
WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY
STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED
OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION
OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE
REASONABLY ACCEPTABLE TO THE COMPANY. THESE SECURITIES MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH
SECURITIES.
2.6 No Reliance. The
Investor has not relied upon the Company or its directors and officers, or the
Company’s legal counsel or advisors for investment, legal or tax advice,
including advice with respect to the hold periods and resale restrictions
imposed upon the Notes by the securities legislation in the jurisdiction in
which the Investor resides, and has, if desired, in all cases sought the advice
of the Investor’s own personal investment advisor, legal counsel and tax
advisors, and the Investor is either experienced in or knowledgeable with regard
to the affairs of the Company or, either alone or with its professional
advisors, is capable by reason of knowledge and experience in financial and
business matters in general, and investments in particular, of evaluating the
merits and risks of an investment in the Notes, and it is able to bear the
economic risk of an investment in the Notes and can otherwise be reasonably
assumed to have the capacity to protect its own interest in connection with the
investment.
2.7 Disclosure of
Information. Such Investor has had an opportunity to receive all
information related to the Company requested by it and to ask questions of and
receive answers from the Company regarding the Company, its business and the
terms and conditions of the offering of the Notes.
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2.8 Purchase Entirely for Own
Account. The Note to be received by such Investor hereunder will be
acquired for such Investor’s own account, not as nominee or agent, and not with
a view t the resale or distribution of any part thereof in
violation of the 1933 Act, and such Investor has no present intention of
selling, granting any participation in, or otherwise distributing the same in
violation of the 1933 Act without prejudice, however, to such Investor’s right
at all times to sell or otherwise dispose of all or any part of such Note in
compliance with applicable federal and state securities laws. Nothing contained
herein shall be deemed a representation or warranty by such Investor to hold the
Note for any period of time. Such Investor is not a broker-dealer registered
with the SEC under the 1934 Act or an entity engaged in a business that would
require it to be so registered
3. REPRESENTATIONS
AND WARRANTIES OF THE COMPANY. Except as set forth in the
disclosure documents, the Company hereby represents and warrants to each
Investor and agrees with each Investor that, as of the Execution
Date:
3.1 Organization, Good Standing
and Qualification. Each of the Company and the Company
Subsidiary is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or organization and has all requisite power and authority to carry
on its business as now conducted. Each of the Company and the Company
Subsidiary is duly qualified to transact business and is in good standing in
each jurisdiction in which it conducts business except where the failure so to
qualify has not had or would not reasonably be expected to have a Material
Adverse Effect.
3.2 Authorization;
Consents. The Company has the requisite corporate power and
authority to enter into and perform its obligations under the Transaction
Documents. Each Company Subsidiary has the requisite power and authority to
enter into and perform its obligations under the Security Agreement. All
corporate action on the part of the Company by its officers, directors and
stockholders necessary for the authorization, execution and delivery of, and the
performance by the Company of its obligations under, the Transaction Documents
has been taken, and no further consent or authorization of the Company, its
Board of Directors, stockholders, any Governmental Authority or any other Person
is required (pursuant to any rule of the Principal Market or otherwise). All
corporate action on the part of each Company Subsidiary by its officers,
directors, stockholders, members or governors necessary for the authorization,
execution and delivery of, and the performance by such Company Subsidiary of its
obligations under the Security Agreement has been taken. The Board of
Directors has determined that the sale and issuance of the Notes, and the
consummation of the other transactions contemplated hereby and by the other
Transaction Documents, are in the best interests of the Company.
3.3 Enforcement. This
Agreement has been duly executed and delivered by the Company, and at the
Closing, each of the Company and the Company Subsidiary will have duly executed
and delivered each of the other Transaction Documents to which such entity is a
party. This Agreement constitutes, and at the Closing, each of the
other Transaction Documents to which the Company or any of the Company
Subsidiary is a party will constitute, the valid and legally binding obligations
of the Company and the Company Subsidiary, enforceable against the Company and
the Company Subsidiary in accordance with their respective terms, subject to (i)
applicable bankruptcy, insolvency, fraudulent transfer, moratorium,
reorganization or other similar laws of general application relating to or
affecting the enforcement of creditors’ rights generally and (ii) general
principles of equity.
3.4 Agreements; Financial
Statements; Other Information. Except as set forth
in the Disclosure Documents, the Company has no liabilities, contingent or
otherwise, other than liabilities incurred in the ordinary course of business
which, under GAAP or IFAS, are not required to be reflected in the financial
statements included in the Disclosure Documents and which, individually or in
the aggregate, are not material to the consolidated business or financial
condition of the Company and the Company Subsidiary taken as a
whole. Such financial statements have been prepared in accordance
with GAAP or IFAS consistently applied at the times and during the periods
involved (except (i) as may be otherwise indicated in such financial statements
or the notes thereto, or (ii) in the case of unaudited interim statements, to
the extent they may exclude footnotes or may be condensed or summary statements)
and fairly present in all material respects the financial position of the
Company as of the dates thereof and the results of its operations and cash flows
for the periods then ended (subject, in the case of unaudited statements, to
normal year-end adjustments).
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3.5 Due Authorization; Valid
Issuance. The Note is duly authorized and, when issued, sold
and delivered in accordance with the terms of this Agreement, will be duly and
validly issued, free and clear of any Liens imposed by or through the
Company.
3.6 No Conflict; No
Violation. Neither the Company nor any Company Subsidiary is
in violation of any provisions of its charter, bylaws or any other governing
document. Neither the Company nor any Company Subsidiary is in
violation of or in default (and no event has occurred which, with notice or
lapse of time or both, would constitute a default) under any provision of any
instrument or contract to which it is a party or by which it or any of its
Property is bound, or in violation of any provision of any Governmental
Requirement applicable to the Company or any Company Subsidiary. The
execution, delivery and performance of this Agreement and the other Transaction
Documents and the consummation of the transactions contemplated hereby and
thereby will not result in any violation of any provisions of the Company’s or
any Company Subsidiary’s charter, bylaws or any other governing document or in a
default under any provision of any instrument or contract to which the Company
or Company Subsidiary is a party or by which it or any of its Property is bound,
or in violation of any provision of any Governmental Requirement applicable to
the Company or Company Subsidiary or be in conflict with or constitute, with or
without the passage of time and giving of notice, either a default under any
such provision, instrument or contract or an event which results in the creation
of any Lien upon any assets of the Company or of any Company Subsidiary or the
triggering of any preemptive rights or rights of first refusal or first
offer.
3.7 Fees. The
Company is not obligated to pay any brokers, finders or financial advisory fees
or commissions to any underwriter, broker, agent or other representative in
connection with the transactions contemplated hereby. The Company will indemnify
and hold harmless such Investor from and against any claim by any person or
entity alleging that such Investor is obligated to pay any such compensation,
fee, cost or related expenditure in connection with the transactions
contemplated hereby.
3.8 Foreign Corrupt
Practices. Neither the Company, any Company Subsidiary nor, to
the knowledge of the Company, any director, officer, agent, employee or other
person acting on behalf of the Company or any Company Subsidiary, has (i) used
any corporate funds for any unlawful contribution, gift, entertainment or other
unlawful expenses relating to political activity, (ii) made any direct or
indirect unlawful payment to any foreign or domestic government official or
employee, or (iii) violated any provision of the Foreign Corrupt Practices Act
of 1977, as amended, or made any bribe, rebate, payoff, influence payment,
kickback or other unlawful payment to any foreign or domestic government
official or employee.
3.9 Employee
Matters. There is no strike, labor dispute or union
organization activities pending or, to the knowledge of the Company, threatened
between the Company or any Company Subsidiary and any of their
employees. Other than as set forth in the Disclosure Documents, no
employees of the Company or any Company Subsidiary belong to any union or
collective bargaining unit. The Company and each Company Subsidiary has complied
in all material respects with all applicable federal and state equal opportunity
and other laws related to employment.
3.10
Environment. Except
as disclosed in the Disclosure Documents, the Company and the Company Subsidiary
have no liabilities under any Environmental Law, nor, to the Company's
knowledge, do any factors exist that are reasonably likely to give rise to any
such liability, affecting any of the properties owned or leased by the Company
or any Company Subsidiary that, individually or in the aggregate, has had or
would reasonably be expected to have a Material Adverse
Effect. Neither the Company nor any Company Subsidiary has violated
any Environmental Law applicable to it now or previously in effect, other than
such violations or infringements that, individually or in the aggregate, have
not had and would not reasonably be expected to have a Material Adverse
Effect.
3.11 ERISA. The
Company does not maintain or contribute to, or have any obligation under, any
Pension Plan. The Company is in compliance in all material respects
with the presently applicable provisions of ERISA and the United States Internal
Revenue Code of 1986, as amended, with respect to each Pension Plan except in
any such case for any such matters that, individually or in the aggregate, have
not had, and would not reasonably be expected to have, a Material Adverse
Effect.
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3.12 Transfer Taxes. No
transfer or other taxes (other than income taxes) are required to be paid in
connection with the issuance and sale of any of the Notes.
4. COVENANTS
OF THE COMPANY.
4.1 RESERVED.
4.2 Existence and
Compliance. The Company agrees that it will, and will cause
each Company Subsidiary to, while Investor holds the Note:
(a) maintain
its corporate existence in good standing;
(b) comply
with all Governmental Requirements applicable to the operation of its business,
except for instances of noncompliance that are immaterial;
(c) comply
with all agreements, documents and instruments binding on it or affecting its
Properties or business, including, without limitation, all Material Contracts,
except for instances of noncompliance that are immaterial;
(d) timely
file with the Commission all reports required to be filed pursuant to the
Exchange Act and refrain from terminating its status as an issuer required by
the Exchange Act to file reports thereunder even if the Exchange Act or the
rules or regulations thereunder would permit such termination; and
4.3 Notice of Event of
Default. Upon the occurrence of an Event of Default, the
Company shall (i) notify Investor of the nature of such Event of Default as soon
as practicable (but in no event later than one Business Day after the Company
becomes aware of such Event of Default), and (ii) not later than two
Business Days after delivering such notice to Investor, issue a press release
disclosing such Event of Default and take such other actions as may be necessary
to ensure that none of the Investors are in the possession of material,
nonpublic information as a result of receiving such notice from the
Company.
5. CONDITIONS
TO CLOSING.
5.1 Conditions to Investors’
Obligations at the Closing. Each Investor’s obligations to
effect the Closing, including without limitation its obligation to purchase its
Note at the Closing, are conditioned upon the fulfillment (or waiver by such
Investor in its sole and absolute discretion) of each of the following events as
of the Closing Date, and the Company shall use commercially reasonable efforts
to cause each of such conditions to be satisfied:
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5.1.1
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the
representations and warranties of the Company set forth in this Agreement
and in the other Transaction Documents shall be true and correct in all
material respects as of such date as if made on such date (except that to
the extent that any such representation or warranty relates to a
particular date, such representation or warranty shall be true and correct
in all material respects as of that particular
date);
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5.1.2
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the
Company shall have complied with or performed in all material respects all
of the agreements, obligations and conditions set forth in this Agreement
and in the other Transaction Documents that are required to be complied
with or performed by the Company on or before the
Closing;
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5.1.3
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the
Company shall have executed and delivered to such Investor the Note being
purchased by such Investor at the
Closing;
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5.1.4
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the
Company shall have delivered to such Investor resolutions passed by its
Board of Directors to authorize the transactions contemplated hereby and
by the other Transaction
Documents;
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5.1.5
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there
shall have occurred no material adverse change in the Company’s
consolidated business or financial condition since the date of the
Company’s most recent financial statements contained in the Disclosure
Documents;
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5.1.6
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there
shall be no injunction, restraining order or decree of any nature of any
court or Governmental Authority of competent jurisdiction that is in
effect that restrains or prohibits the consummation of the transactions
contemplated hereby and by the other Transaction
Documents
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5.1.7.
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the
Company shall have paid the expenses described in 6.8
of this Agreement.
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5.2 Conditions to Company’s
Obligations at the Closing. The Company’s obligations to
effect the Closing with an Investor are conditioned upon the fulfillment (or
waiver by the Company in its sole and absolute discretion) of each of the
following events as of the Closing Date:
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5.2.1
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the
representations and warranties of such Investor set forth in this
Agreement and in the other Transaction Documents to which it is a party
shall be true and correct in all material respects as of such date as if
made on such date (except that to the extent that any such representation
or warranty relates to a particular date, such representation or warranty
shall be true and correct in all material respects as of that
date);
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5.2.2
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such
Investor shall have complied with or performed all of the agreements,
obligations and conditions set forth in this Agreement that are required
to be complied with or performed by such Investor on or before the
Closing;
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5.2.3
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there
shall be no injunction, restraining order or decree of any nature of any
court or Governmental Authority of competent jurisdiction that is in
effect that restrains or prohibits the consummation of the transactions
contemplated hereby and by the other Transaction
Documents;
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5.2.4
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such Investor shall have executed each Transaction
Document to which it is a party and shall have delivered the same to the
Company; and
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5.2.5
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such Investor shall have tendered the Purchase
Price for the Note being purchased by it at the Closing by wire transfer of immediately available
funds pursuant to the wiring
instructions as delivered to Investor by the Company
.
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6. MISCELLANEOUS.
6.1 Survival;
Severability. The representations, warranties, covenants and
indemnities made by the parties herein and in the other Transaction Documents
shall survive the Closing notwithstanding any due diligence investigation made
by or on behalf of the party seeking to rely thereon. In the event that any
provision of this Agreement becomes or is declared by a court of competent
jurisdiction to be illegal, unenforceable or void, this Agreement shall continue
in full force and effect without said provision; provided that in such case
the parties shall negotiate in good faith to replace such provision with a new
provision which is not illegal, unenforceable or void, as long as such new
provision does not materially change the economic benefits of this Agreement to
the parties.
6.2 No
Reliance. Each party acknowledges that (i) it has such
knowledge in business and financial matters as to be fully capable of evaluating
this Agreement, the other Transaction Documents and the transactions
contemplated hereby and thereby, (ii) it is not relying on any advice or
representation of any other party in connection with entering into this
Agreement, the other Transaction Documents or such transactions (other than the
representations made in this Agreement or the other Transaction Documents),
(iii) it has not received from any other party any assurance or guarantee as to
the merits (whether legal, regulatory, tax, financial or otherwise) of entering
into this Agreement or the other Transaction Documents or the performance of its
obligations hereunder and thereunder, and (iv) it has consulted with its own
legal, regulatory, tax, business, investment, financial and accounting advisors
to the extent that it has deemed necessary, and has entered into this Agreement
and the other Transaction Documents based on its own independent judgment and,
if applicable, on the advice of such advisors, and not on any view (whether
written or oral) expressed by any other party.
6.3 Governing Law;
Jurisdiction. This Agreement shall be governed by and
construed under the laws of the State of New York. Each party hereby irrevocably
submits to the exclusive jurisdiction of the state and federal courts sitting in
the City and County of New York for the adjudication of any dispute hereunder or
any other Transaction Document or in connection herewith or therewith or with
any transaction contemplated hereby or thereby, and hereby irrevocably waives,
and agrees not to assert in any suit, action or proceeding, any claim that it is
not personally subject to the jurisdiction of any such court, that such suit,
action or proceeding is brought in an inconvenient forum or that the venue of
such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address in effect for notices to it under this Agreement and agrees
that such service shall constitute good and sufficient service of process and
notice thereof. Nothing contained herein shall be deemed to limit in
any way any right to serve process in any manner permitted by law.
10
6.4 Successors and
Assigns. The terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective successors and
permitted assigns of the parties. Nothing in this Agreement, express
or implied, is intended to confer upon any party other than the parties hereto
or their respective successors and permitted assigns any rights, remedies,
obligations or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement. An Investor may assign its rights and
obligations hereunder in connection with any sale or transfer of the Notes in
accordance with the terms hereof and of the other Transaction Documents, as long
as, as a condition precedent to such transfer, the transferee executes an
acknowledgment agreeing to be bound by the applicable provisions of this
Agreement, in which case the term “Investor” shall be deemed to refer to such
transferee as though such transferee were an original signatory
hereto. The Company may not assign its rights or obligations under
this Agreement.
6.5 Counterparts. This
Agreement may be executed in any number of counterparts, each of which shall be
deemed an original, and all of which together shall constitute one and the same
instrument. This Agreement may be executed and delivered by facsimile
transmission.
6.6 Headings. The
headings used in this Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement.
6.7 Notices. Any
notice, demand or request required or permitted to be given by the Company or
the Investor pursuant to the terms of this Agreement shall be in writing and
shall be deemed delivered (i) when delivered personally or by verifiable
facsimile transmission, unless such delivery is made on a day that is not a
Business Day, in which case such delivery will be deemed to be made on the next
succeeding Business Day, (ii) on the next Business Day after timely delivery to
an overnight courier and (iii) on the Business Day actually received if
deposited in the U.S. mail (certified or registered mail, return receipt
requested, postage prepaid), addressed as follows:
If to the
Company:
Xxxxx
Xxxxxxxxxx
0000X
Xxxx Xxxxxxxxx
Xxxxxx
Xxxxx Xxxxx, Xxxxxxx 00000
Tel:
000-000-0000
If to Investor:
Omnireliant
Holdings, Inc.
00000
Xxxxxxxx Xxxxxx
Xxxxxxxxxx,
XX 00000
Telephone:
000-000-0000
and if to
any Investor, to such address for such Investor as shall appear on the signature
page hereof executed by such Investor, or as shall be designated by such
Investor in writing to the Company in accordance with this Section
6.7.
11
6.8 Expenses. The
Company and each Investor shall pay all costs and expenses that it incurs in
connection with the negotiation, execution, delivery and performance of this
Agreement or the other Transaction Documents.
6.9 Entire Agreement;
Amendments. This Agreement and the other Transaction Documents
constitute the entire agreement between the parties with regard to the subject
matter hereof and thereof, superseding all prior agreements or understandings,
whether written or oral, between or among the parties. No amendment,
modification or other change to this Agreement or waiver of any agreement or
other obligation of the parties under this Agreement may be made or given unless
such amendment, modification or waiver is set forth in writing and is signed by
the Company and by the holders of a majority of the aggregate principal of the
Notes then outstanding. Any waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.
[Signature
Pages to Follow]
12
IN
WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first-above written.
By:
______________________________
Xxxxx
Xxxxxxxxxx
Chief
Executive Officer
OMNIRELIANT
HOLDINGS, INC.
By:
______________________________
Xxxx
Xxxxxxxx
Chief
Executive Officer
Principal
Amount of Note Purchased at Closing: $100,000
ADDRESS:
Omnireliant
Holdings, Inc.
00000
Xxxxxxxx Xxxxxx
Xxxxxxxxxx,
XX 00000
Telephone:
000-000-0000
13
EXHIBIT
A
10%
SECURED CONVERTIBLE PROMISSORY NOTE
EXHIBIT
B
SECURITY
AGREEMENT
