LOAN AGREEMENT
Exhibit
10.1
BETWEEN:
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XXXXX XXXXX, Xxxxx 0000,
Xxxxxxxx Xxxxx, 000 Xxxxxxx Xxxxxx, Xxxxxxxxx, X.X., X0X
0X0
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(the
"Lender");
AND:
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GULF
WESTERN PETROLEUM CORPORATION, acorporation
incorporated under the laws of the State of Nevada, with its registered
office at 0000 Xxxxxxx Xxxxx, Xxxxx 000X, Xxxxxxx, Xxxxx
00000
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(the
"Borrower").
WHEREAS
the Borrower wishes to borrow and the Lender is willing to lend to the Borrower
US$500,000 (the "Principal") on the terms of this Agreement.
NOW
THEREFORE THIS AGREEMENT WITNESSES that in consideration of the premises and the
mutual covenants and agreements hereinafter set forth, the parties hereto agree
as follows:
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1.
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DEFINITIONS
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Where
used in this Agreement, the following words and phrases shall have the following
meaning:
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(a)
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"Agreement"
means this Agreement and the schedule hereto, as at any time amended or
modified and in effect;
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(b)
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"Bonus"
has the meaning given to that term in section
5;
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(c)
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"Event
of Default" means any event specified in subsection
8.1;
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(d)
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"Lender's
Security" means the Note;
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(e)
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"Loan"
means the loan by the Lender to the Borrower established pursuant to
subsection 3.1; and
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(f)
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"Note"
means the promissory note to be made by the Borrower to the Lender as
evidence of the Loan.
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2.
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INTERPRETATION
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2.1
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Governing
Law
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This
Agreement is governed by the laws of the Province of British Columbia and the
parties attorn to the non-exclusive jurisdiction of the courts of British
Columbia for the resolution of all disputes under this
Agreement.
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2.2
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Severability
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2.3
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Parties
In Interest
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This
Agreement enures to the benefit of and is binding on the parties hereto and
their respective successors and permitted assigns.
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2.4
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Headings
and Marginal References
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The
division of this Agreement into sections, subsections, paragraphs and
subparagraphs and the insertion of headings are for convenience of reference
only and do not affect the construction or interpretation of this
Agreement.
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2.5
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Currency
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All
statements of, or references to, dollar amounts in this Agreement means lawful
currency of United Stales of America.
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3.
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THE
LOAN
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3.1
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Establishment
of the Loan
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The
Lender agrees, on the terms and conditions set forth in this Agreement, to lend
to the Borrower $500,000.
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3.2
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Evidence of
Indebtedness
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Indebtedness
of the Borrower to the Lender in respect of the Loan will be evidenced by the
execution this Agreement and the Note, which will be made by the Borrower to the
Lender at the time of execution of this Agreement.
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3.3
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Interest
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The
Borrower will pay interest at a rate of 10% per annum to the Lender on the
amount of Principal outstanding both before and after maturity, default and
judgment. Interest on the outstanding Principal amount shall accrue daily and
compound annually. Additionally, the repayment of accrued interest will paid on
a monthly basis (on the 12th of each
month), with the first payment being made 3 months after the execution of the
Agreement.
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3.4
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Repayment of the
Loan
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The
entire Principal and the final interest payment payable pursuant to this
Agreement shall be due and payable on March 12, 2009.
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3.5
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Prepayment
of Loan
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Provided
that the Bonus as set forth in section 5 below, the Borrower may prepay the
Principal and the interest outstanding under the Loan at any time without
penalty, bonus or charges.
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4.
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SECURITY
FOR THE LOAN
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4.1
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Lender's
Security
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On the
execution of this Agreement the Borrower will execute and deliver to the Lender
the Note, the form of which is attached hereto as Schedule A, evidencing the
Borrower's obligations and covenants under this Loan
Agreement.
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4.2
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Costs,
Charges and Expenses
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The
Borrower will assume and pay all costs, commission, charges and expenses,
including reasonable solicitors' costs, charges and expenses on a special costs
basis, which may be incurred by the Lender in respect of the enforcement of this
Agreement or the Lender's Security or which may be incurred by the Lender in
respect of any proceedings taken or things done by the Lender in connection
therewith to collect, protect, realize or enforce the Lender's Security and the
Borrower consents to such costs, charges and expenses being charged and fixed on
a lump sum basis in accordance with the Legal Profession Act (British
Columbia).
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5.
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BONUS
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On the
execution of this Agreement, the Borrower agrees to immediately issue to the
Lender, as a bonus (the "Bonus"), 1,000,000 Rule 144 common shares in the share
capital of the Borrower, at a deemed price of $0.25. In conjunction with the
issuance of the common shares to Lender, Lender confirms that he is as an
Accredited Investor as that term is defined in Regulation D adopted pursuant to
the Securities Act of 1933, as amended. Specifically, the Lender is a natural
person whose individual net worth, or joint net worth with that person's spouse,
at the time of his receipt of common shares exceeds
SI,000,000.
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6.
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REPRESENTATIONS
AND WARRANTIES
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6.1
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Representations
and Warranties
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The
Borrower represents and warrants to the Lender that:
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(a)
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the
Borrower is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of
Nevada;
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(b)
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the
Borrower has all requisite corporate power and authority to enter into
this Agreement and to carry out the obligations contemplated herein and
therein;
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(c)
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this
Agreement has been duly and validly authorized, executed and delivered by
the Borrower and are valid obligations of it;
and
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(d)
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no
Event of Default and no event which, with the giving of notice or lapse of
time would become an Event of Default, has occurred or is
continuing.
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6.2
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Survival
of Representations and
Warranties
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All
representations and warranties made herein will survive the delivery of this
Agreement to the Lender and no investigation at any time made by or on behalf of
the Lender shall diminish in any respect whatsoever its rights to rely on those
representations and warranties. All statements contained in any certificate or
other instrument delivered by or on behalf of the Borrower under or pursuant to
this Agreement will constitute representations and warranties made by the
Borrower thereunder.
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7.
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COVENANTS
OF THE BORROWER
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The
Borrower covenants and agrees with the Lender that, at all times during the
currency of this Agreement, it will:
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(a)
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pay
the principal sum, interest and all other monies required to be paid to
the Lender pursuant to this Agreement in the manner set forth
herein;
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(b)
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duly
observe and perform each and every of its covenants and agreements set
forth in this Agreement; and
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(c)
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provide
the Lender with immediate notice of any Event of
Default.
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8.
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EVENT
OF DEFAULT
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8.1
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Definition
of Event of Default
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The
principal balance of the Loan, costs and any other money owing to the Lender
under this Agreement will immediately become payable upon demand by the Lender
or, unless otherwise waived in writing by the Lender, in any of the following
events:
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(a)
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if
the Borrower defaults in any payment when due under this
Agreement;
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(b)
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if
the Borrower makes a general assignment for the benefit of its creditors,
or if any order is made or an effective resolution is passed for the
winding-up, merger or amalgamation of the Borrower or if the Borrower is
declared bankrupt or if a custodian or receiver be appointed for the
Borrower under the applicable bankruptcy or insolvency legislation, or if
a compromise or arrangement is proposed by the Borrower to its creditors
or any class of its creditors, or if a receiver or other officer with like
powers is appointed for the Borrower;
or
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(c)
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if
the Borrower defaults in observing or performing any other covenant or
agreement of this Agreement on its part to be observed or performed and
such default has continued for a period of seven days after notice in
writing has been given by the Lender to the Borrower specifying the
default,
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8.
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ASSIGNMENT
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8.1
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Assignment
of Borrower
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The
Borrower may not assign this Agreement or its interest herein or any part hereof
except with the prior written consent of the Lender.
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9.
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GENERAL
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9.1
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Waiver
or Modification
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No
failure on the part of the Lender in exercising any power or right hereunder
will operate as a waiver of the Lender's power or right nor will any single or
partial exercise of such right or power preclude any other right or power
hereunder. No amendment, modification or waiver of any condition of this
Agreement or consent to any departure by the Borrower therefrom will be
effective unless it is in writing signed by the Lender. No notice to or demand
on the Borrower will entitle the Borrower to any other further notice or demand
in similar or other circumstances unless specifically provided for in this
Agreement.
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9.2
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Time
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Time is
of the essence of this Agreement.
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9.3
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Further
Assurances
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The
parties to this Agreement will do, execute and deliver or will cause to be done,
executed and delivered all such further acts, documents and things as may be
reasonably required for the purpose of giving effect to this
Agreement.
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10.
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NOTICES
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10.1 Any
notice under this Agreement will be given in writing and may be sent by fax,
telex, telegram or may be delivered or mailed by prepaid post addressed to the
party to which notice is to be given at the address indicated above, or at
another address designated by that party in writing.
10.2 If
notice is sent by fax or is delivered, it will be deemed to have been given at
the time of transmission or delivery.
10.3 If
notice is mailed, it will be deemed to have been received 48 hours following the
date of mailing of the notice.
10.4 If
there is an interruption in normal mail service due to strike, labour unrest or
other cause at or before the time a notice is mailed the notice will be sent by
fax or will be delivered.
[THE REST
OF THIS PAGE LEFT INTENTIONALLY BLANK]
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11.
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AMENDMENTS
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This
Agreement may be amended waived discharged or terminated only by instrument in
writing signed by the party against whom enforcement of the amendment, waiver,
discharge or termination is sought.
IN
WITNESS WHEREOF the Lender and the Borrower have executed and delivered this
Agreement.
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SIGNED,
SEALED AND DELIVERED by
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XXXXX
XXXXX in the presence of:
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)
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Xxxxxxx
Xxxxxx
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)
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Name
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0000-000
Xxxxxxx Xx.
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)
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Vancouver,
B.C.
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V6C3A6
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/s/
Xxxxx Xxxxx
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Address
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XXXXX
XXXXX
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)
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Assistant
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Occupation
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MARCH
12, 2008
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GULF
WESTERN PETROLEUM CORPORATION
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By:
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/s/ Xxxxxx X. Xxxxxx | |
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Authorized
Signatory
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- 7
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SCHEDULE
"B"
FORM
OF PROMISSORY NOTE
PROMISSORY
NOTE
| US$500,000 |
March 12,
2008
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FOR VALUE
RECEIVED, GULF WESTERN
PETROLEUM CORPORATION (the "Borrower"), of 0000 Xxxxxxx Xxxxx, Xxxxx
000X, Xxxxxxx Xxxxx 00000, PROMISES TO PAY on demand to the order of XXXXX XXXXX, of 0000-000 Xxxxxxx
Xxxxxx, Xxxxxxxxx, X.X. X0X 0X0, the sum
of US$500,000 with
interest at 10% per annum accrued daily and compounded annually and payable
annually in arrears, both before and after the time payment is due and until
actual payment.
The
Borrower waives presentment for payment, notice of protest and notice of
non-payment.
The
Borrower may repay, at any time, all or any part of the US$500,000 without
notice, bonus or penalty.
Signed as
of MARCH 12, 2008.
GULF
WESTERN PETROLEUM CORPORATION.
| By: | /s/ XXxxxx X. Xxxxxx |
