Exhibit 10.15
FUNDING AGREEMENT
THIS FUNDING AGREEMENT, dated this 31st day of March, 1999
("Agreement"), is by and among iParty Corp., a Delaware corporation, ("iParty"),
Xxxxx Xxxx, ("Khan"), and Xxxxxx X. Xxxxxx, ("Xxxxxx").
W I T N E S S E T H:
WHEREAS, pursuant to a warrant certificate dated June 30, 1998, Xxxxxxx
Developments Limited ("Xxxxxxx") was granted warrants to purchase a total of
556,500 shares of iParty Series A Preferred Stock at $1.00 per share (the
"Xxxxxxx Warrant"), of which warrants to purchase 214,500 shares of iParty
Series A Preferred Stock remain unexercised;
WHEREAS, pursuant to a warrant certificate dated June 30, 1998,
Henslowe Trading Limited ("Henslowe") was granted warrants to purchase a total
of 443,500 shares of iParty Series A Preferred Stock at $1.00 per share (the
"Henslowe Warrant"), of which warrants to purchase 97,500 shares of iParty
Series A Preferred Stock remain unexercised;
WHEREAS, in order to facilitate a financing, which may include a
private placement or a rights offering (the "Financing") contemplated by iParty,
and to resolve iParty's short term capital needs, the parties hereto desire to
reduce the time frame in which the Warrant Funds (defined below) are required to
be invested in iParty pursuant to the terms of the Henslowe and Xxxxxxx
Warrants; and
WHEREAS, in order to facilitate the Financing and to resolve the
short-term capital needs of iParty, Xxxxxx desires to commit to advance certain
funds to iParty;
NOW, THEREFORE, in consideration of the mutual premises and agreements
contained herein and intending to be legally bound hereby, the parties hereto
agree as follows:
1. Time Frame For Investment of Warrant Funds. Khan shall cause each of
Henslowe and Xxxxxxx to exercise their respective warrants in full by April 6,
1999. On exercise of such warrants, Henslowe and Xxxxxxx shall transfer to
iParty a total of $312,000 ($97,500 by Henslowe and $214,500 by Xxxxxxx,
collectively, the "Warrant Funds"). Payment of the Warrant Funds shall be made
by wire transfer in accordance with instructions provided to Khan by iParty.
2. Advances by Xxxxxx X. Xxxxxx. (a) On or before April 2, 0000, Xxxxxx
shall advance $250,000 to iParty. Payment shall be made by wire transfer in
accordance with wire instructions provided to Xxxxxx by iParty. Xxxxxx'x
$250,000 shall be credited against his investment in the Financing to be
effected by iParty.
(b) Further, Xxxxxx agrees to advance the sum of $250,000 on or before
the 2nd of each month until the earlier of (i) the completion of the Financing
and (ii) August 2, 1999. Any advance will be senior debt of the Company and
shall be evidenced by a convertible promissory note.
3. Modification. This Agreement sets forth the entire understanding of
the parties with respect to the subject matter hereof, supersedes all existing
agreements between them concerning such subject matter, and may be modified only
by a written instrument duly executed by each party.
4. Counterparts; Governing Law. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. It shall be
governed by, and construed in accordance with, the laws of the State of New
York, without giving effect to the rules governing the conflicts of laws.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first written above.
iPARTY CORP.
By: /s/ Xxxxx Hero
------------------------------------
Name: XXXXX HERO
Title: PRESIDENT
/s/ Xxxxxx X. Xxxxxx
----------------------------------------
XXXXXX X. XXXXXX
/s/ Xxxxx Xxxx
-----------------------------------------
XXXXX XXXX
