LEASE/PURCHASE AND MANAGEMENT AGREEMENT
THIS LEASE/PURCHASE AND MANAGEMENT AGREEMENT is made as of the 15th
day of September, 2000, by and among WasteMasters, Inc., a Delaware
corporation (hereinafter called "Lessee"), WasteMasters, Inc., a Maryland
corporation ("WasteMasters") and Global Eco-Logical Services, Inc.
(hereinafter called "Lessor").
WITNESSETH:
1. Leased Property. Lessor, for and in consideration of the rents,
covenants, agreements, and stipulations hereafter mentioned, provided for
and contained to be paid, kept and performed by Lessee, leases and rents
unto Lessee, and Lessee hereby leases and takes upon the terms and
conditions which hereinafter appear, the following described property,
(hereinafter called the "Property"), to wit: Tri-State Waste Disposal,
Inc., a New Jersey corporation; Lisbon Landfill, Inc., a Florida
corporation; and All Waste Disposal Service, Inc., a Commonwealth of
Pennsylvania corporation (hereinafter, the "Corporations").
2. Term. The Lessee shall have and hold the Property for a term
equal to the shorter of one year or the date of Closing in the event the
Lessee exercises the Option (as defined herein).
3. Rental. Lessee agrees to pay to Lessor at the address of Lessor
as stated in this Lease, without demand, deduction or set off, monthly
rental of $10.00 per month. Monthly rental payments shall be paid in
advance on the first day of each calendar month during the term hereof.
Upon execution of this Lease, Lessee shall pay to Lessor the first full
month's rent due hereunder.
4. Management of Property. During the term of this Lease, the
Lessee shall have the sole and exclusive right to operate and manage the
Property. As sole shareholder of the Corporations, the Lessor hereby
grants the Lessee an irrevocable proxy during the term of this Lease to
vote the Lessor's shares in the Corporations to appoint such persons that
the Lessee deems advisable to the board of directors of each of the
Corporations, and the Lessee hereby agrees to replace the board of
directors of each of the Corporations with the Lessee's nominees promptly
after execution of this Lease. Lessor and Lessee agree that the
foregoing proxy shall not entitle the Lessee to vote the Lessor's shares
of stock in the Corporations on any matter other than the election of
directors to the Corporations during the term of this Lease, including
without limitation any proposed merger, share exchange, sale of assets,
amendment to articles of incorporation or any other act which requires
approval of the shareholders of the Corporations under the Corporations'
articles of incorporation, bylaws or applicable law. The Lessee further
agrees that the foregoing proxy shall expire upon the expiration or
termination of this Lease, and that the foregoing proxy is not
exercisable at any time that the Lessee is in default under this
Lease. The Lessee further agrees that it will not take any action to
cause the Corporations to sell, mortgage, pledge or lease any assets
outside the ordinary course of business or file any petition for relief
under the United States Bankruptcy Code without the prior written consent
of the Lessor.
5. Additional Consideration. As consideration for this Agreement,
Lessee and WasteMasters, jointly and severally, will assume those certain
debt instruments in the Lessor (the "Debentures"), totaling $1,590,000,
plus accrued interest at 8.5% and permissible default fees, pursuant to
and in accordance with the Debenture Modification Agreements of the
Lessor, attached hereto as Exhibit A and incorporated herein by this
reference. The shares issued and delivered in accordance with this
Agreement and the attached Modification Agreement will be duly
authorized, validly issued, fully paid and nonassessable, free of any
preemptive or other similar rights of any person. The shares when
delivered as set forth therein will be registered and declared effective
within 120 days from the date of this Agreement pursuant to the
Securities Act of 1933, as amended, on a registration statement that has
been declared effective by the SEC.
6. Operation of Property. The Lessee shall be responsible for
providing all management, consulting, financial, marketing and
operational support services to the Property. The Lessee shall be
entitled to all revenues generated by the Property and shall be
responsible for paying all expenses and liabilities incurred and accrued
by the Property on and after the date of this Agreement including,
without limitation, all installments of approved Company Debt and
outstanding accounts payable. Lessee agrees that it shall be responsible
for providing funds to the Property to the extent the expenses of the
Property are greater than the revenues of the Property during the term of
this Lease determined on an accrual basis under generally accepted
accounting principles (but excluding any noncash expenses such as
depreciation or amortization of goodwill), and the Lesseee
shall be entitled to retain all profits generated by the Property
determined under the same principles. The obligations of the Lessee to
manage the Property include the obligation to:
(a) Administer, supervise and control all of the finances of the
Property, including payroll, taxes, accounting, bookkeeping, record
keeping, managing of accounts payable, and accounts receivable, banking,
financial records and reporting functions as they pertain to the business
of the Property, with the power to make such changes therein, in its sole
discretion, and to incorporate such functions into systems used by
Lessee. Lessee shall prepare and maintain financial statements for the
Property according to generally accepted accounting principles
consistently applied and shall provide the Lessor with monthly operating
reports and statements including but not limited to cash flow statements,
income statements, accounts payable and accounts receivable reports and
such other reports and information as may be requested by Lessor from
time to time to enable the Lessor to comply with its reporting
requirements under the Securities Exchange Act of 1934.
(b) Select and employ all personnel necessary to service the
Property.
(c) Supervise and control the purchase of all materials and
supplies, and acquire, lease, dispose of and repair equipment and
facilities necessary to provide safe and adequate service to the business
of the Property.
(d) Manage, at Lessee's sole discretion, all costs and all pricing
on a customer-by-customer basis, estimate all costs on new contracts, bid
on and enter into new contracts, and control all costs for contracts in
progress.
(e) Commence, defend and control all legal actions, arbitrations,
investigations and proceedings that arise or are pending during the term
of this Lease.
(f) Maintain the assets of the Property in good repair, order and
condition, normal and reasonable wear and tear excepted.
7. Licenses and Permits. The parties acknowledge that this Lease as
well as the transfer of the Property to the Lessee pursuant to the option
herein may be subject to approval by the State of Ohio Environmental
Protection Agency, and similar state agencies in New Jersey and
Pennsylvania and they will cooperate in seeking such approval. The Lessee
shall be responsible for the cost of transferring or obtaining any
licenses or permits necessary to conduct the business of the Property,
and for maintaining such licenses and permits in good standing during the
term of this Lease.
8. Books and Records. The Lessor shall provide the Lessee with
access to all books and records necessary for the transition of
management of the Property to the Lessee hereunder, including any
corporate records of the Property, any payroll records for employees of
the Property, any customer lists, and any financial records, such as the
general ledger, accounts payable, accounts receivable, etc. Promptly
after the termination or expiration of this Lease, the Lessee shall turn
over to the Lessor all books and records relating to or generated during
the Lessee's operation of the Property during the term of this Lease, or
which was turned over to Lessee at the commencement of this Lease.
9. No Agency. The Lessee shall, at all times, be independent of the
Lessor. Nothing contained herein shall be deemed to make or render the
Lessor a partner, co-venturer or other participant in the business or
operations of the Lessee, or in any manner to render Lessor liable, as
principal, surety, guarantor, agent or otherwise for any of the debts,
obligations or liabilities of the Property incurred during the term of
this Lease.
10. Abandonment of Property. Lessee agrees not to abandon or vacate
the Property during the term of this Lease and agrees to use the Property
for the purposes herein leased until the expiration hereof.
11. Indemnity; Insurance. Lessee agrees to and hereby does
indemnify and save Lessor harmless against all claims for damages to
persons or property by reason of Lessee's use or occupancy of the
Property, and all expenses incurred by Lessor because thereof, including
attorney's fees and court costs. Lessee agrees that it will, at its own
expense, at all times procure for, deliver to and maintain for the
benefit of Lessor during the term of this Lease, original paid up
insurance policies of such insurance companies, in such amounts, in such
form and substance, and with such expiration dates as are acceptable to
Lessor and which name the Lessor as additional insured. Until the Lessee
is notified otherwise in writing by the Lessor, the Lessee shall maintain
the following insurance: (a) Comprehensive General Liability of
$1,000,000.00, which includes insurance against liability for injury to
or death of persons or loss or damage to their property occurring in or
about the Property; (b) Hazard insurance against loss or damage to the
Property by fire, lightning, windstorm, hail, explosion, riot, riot
attending a strike, civil commotion, aircraft, vehicles, smoke, vandalism
and malicious mischief and against such other hazards as, under good
insurance practices, from time to time are insured against for properties
of similar character and location, the amount of which insurance shall be
not less than one hundred (100.0%) per cent of the full replacement cost
of the Property without deduction for depreciation and which policies of
insurance shall contain satisfactory replacement cost endorsements.
Lessee shall deliver to Lessor a certificate of any renewal insurance
policies on or before the date of expiration of any existing insurance
policy.
12. Governmental Orders. Lessee agrees, at his own expense, to
comply promptly with all requirements of any legally constituted public
authority made necessary by reason of Lessee's occupancy and management
of the Property. Lessor agrees to comply promptly with any such
requirements if not made necessary by reason of Lessee's occupancy and
management.
13. Assignment and Subletting. Lessee shall not have the right to
sublease the Property or any part thereof, assign this Lease or any
interest hereunder, or permit the use of the Property by another party
other than the Lessee without the prior written consent of Lessor. No
sublease or assignment by Lessee shall relieve Lessee of any liability
hereunder.
14. Termination of Lease. Lessor may, at its option, upon ten (10)
days' written notice terminate this Lease (if such default is not cured
within such ten (10) day period or such longer period as required to
effect a cure if a cure is commenced within 10 days and diligently
prosecuted): (i) if Lessee shall violate any material provision of this
Lease; (ii) if Lessee shall violate or be in material breach of any
provision, representation, warranty, covenant or undertaking herein; or
(iii) if Lessee (a) makes an assignment for the benefit of creditors, (b)
is adjudicated a bankrupt, (c) files or has filed against it any
bankruptcy, reorganization, liquidation or similar petition or any
petition seeking the appointment of a receiver, conservator or other
representative, or (d) proposes a composition arrangement with creditors.
Termination of the Lease pursuant to this paragraph shall not limit or
impair any other rights which the Lessor has hereunder, including without
limitation the right to file suit against the Lessee to recover damages
for the violation of any term herein or to right to set off any debt
which the Lessor may owe the Lessee against any liability of the Lessee
to the Lessor hereunder.
15. Quiet Enjoyment. So long as Lessee observes and performs the
covenants and agreements contained herein, it shall at all times during
the Lease term peacefully and quietly have and enjoy possession of the
Property, but always subject to the terms hereof.
16. No Estate in Property. This Lease shall create the relationship
of Lessor and Lessee between the parties hereto. No estate shall pass
out of Lessor. Lessee has only a usufruct not subject to levy and sale,
and not assignable by Lessee except by Lessor's consent.
17. Attorney's Fees. In the event that any action or proceeding is
brought to enforce any term, covenant or condition of this Lease on the
part of Lessor or Lessee, the prevailing party in such litigation shall
be entitled to recover reasonable attorney's fees to be fixed by the
court in such action or proceeding. Furthermore, Lessor and Lessee agree
to pay the attorney's fees and expenses of the other party to this Lease
(either Lessor or Lessee) if it is made a party to litigation because of
its being a party to this Lease and when it has not engaged in any
wrongful conduct itself.
18. Press Releases. No publicity release or announcement concerning
this Lease or the Option or the transactions contemplated hereby shall be
issued without advance approval of the form and substance thereof by
Lessor or Lessee.
19. Rights Cumulative. All rights, powers, and privileges conferred
hereunder upon the parties hereto shall be cumulative and not restrictive
of those given by law.
20. Waiver of Rights. No failure of Lessor to exercise any power
given Lessor hereunder or to insist upon strict compliance by Lessee of
its obligations hereunder and no custom or practice of the parties at
variance with the terms hereof shall constitute a waiver of Lessor's
right to demand exact compliance with the terms hereof.
21. Agency Disclosure. Lessor represents to Lessee that Lessor has
not engaged any agent in regard hereto or to the sale or lease of the
Property, and Lessor hereby agrees to indemnify Lessee and hold Lessee
harmless against all liability, loss, cost, damage and expense
(including, without limitation, attorneys' fees and cost of litigation)
Lessee shall ever suffer or incur because of any claim by any agent
claiming by, through or under Lessor, whether or not meritorious, for any
fee, commission or other compensation with respect hereto. Lessee
represents to Lessor that it has not engaged any agent in regard hereto,
and Lessee hereby agrees to indemnify Lessor and hold Lessor harmless
against all liability, loss, cost, damage and expense (including, without
limitation, attorneys' fees and cost of litigation) Lessor shall ever
suffer or incur because of any claim by any agent claiming by, through or
under Lessee, whether or not meritorious, for any fee, commission or
other compensation with respect hereto or with respect to the Property.
22. Environmental Laws. Lessor represents, to the best of their
knowledge and belief, that 1) the Property are in compliance with all
applicable environmental laws, and 2) there are not excessive levels (as
defined by the Environmental Protection Agency) of radon, toxic waste or
hazardous substances on the Property. Lessee represents and warrants
that Lessee shall comply with all applicable environmental laws and that
Lessee shall not permit any of his employees, agents, contractors for
subcontractors, or any person present on the Property to generate,
manufacture, store, dispose or release on, about, or under the Property
any hazardous substances which would result in the Property not complying
with any applicable environmental laws, and Lessee hereby indemnifies and
holds Lessor harmless from any liability or claim, including attorney's
fees incurred by Lessor, arising out of a breach of Lessor's obligations
under this paragraph.
23. Option to Purchase. The Lessor hereby grants to the Lessee an
option to purchase the Property on the terms and conditions set forth
below:
a) Option Price. The Lessee may purchase the Property for Fifteen
Million (15,000,000) shares of WasteMasters common stock or its cash
equivalent, guaranteed at $.15 per share or "market price," whichever is
higher at time of conversion.
When issued and delivered in accordance with this Agreement, the
shares will be duly authorized, validly issued, fully paid and
nonassessable, free of any preemptive or other similar rights of any
person. The shares, when delivered as set forth herein will be
registered pursuant to the Securities Act of 1933, as amended, on a
registration statement that has been declared effective by the SEC.
b) Term of Option. The Lessee may exercise this Option at any time
prior to the expiration or termination of this Lease.
c) Manner of Exercise of Option. The Lessee may exercise this
Option by written notice to the Lessor in the manner set forth in this
Lease for the giving of notice to the Lessor. Such notice shall state
the Lessee's election to exercise this Option, shall be signed by an
officer of the Lessee, and shall state a date, time and location in the
Charleston, South Carolina metro area where the Closing of the purchase
of the Property will take place, which date shall be between 5 and 10
days after the date of receipt of such notice. The exercise of the
Option by the Lessee shall constitute a binding obligation on the part of
the Lessee to purchase the Property on the terms and conditions set forth
herein and on the Lessor to convey the Property on the terms and
conditions set forth herein.
d) Title to Property. In the event the Option is exercised, the
Corporations shall be conveyed to the Lessee by assignment of all of the
issued and outstanding common stock of the Corporations to the Lessee by
the Lessor free and clear of all liens, claims or encumbrances.
e) Condition of Property. In the event the Option is exercised,
the Property shall be conveyed to the Lessee "as is, where is," without
any express or implied warranties, including any warranties of condition,
of merchantability or fitness for a particular purpose. Furthermore, the
Lessor makes no warranties as to the financial condition of the
Corporations, it being understood by the parties that the Lessee shall
conduct any due diligence investigation of the Property while it is the
Lessee under this Lease prior to exercising the Option to purchase the
Property.
f) Conditions to Conveyance. The Lessee acknowledges and agrees
that the Lessor's obligation to convey the Property is conditioned upon
the subsequent approval of the Option price by the board of directors of
the Lessor after receipt of such independent valuations or reports as may
be necessary in the judgment of the board to determine that the Option
price fairly represents the value of the Property. The Lessor agrees to
commission and obtain any fairness opinions or reports which it may need
to approve the Option price herein as soon as practical after the
execution of this Lease.
24. Time of Essence. Time is of the essence with respect to this
Lease.
25. Notices. All notices required or permitted under this Lease
shall be in writing and shall be personally delivered or sent by U.S.
Certified Mail, return receipt requested, postage prepaid. Agent shall
be copied with all required or permitted notices. Notices to Lessee
shall be delivered or sent to the address shown below, except that upon
Lessee's taking possession of the Property, the Property shall be
Lessee's address for notice purposes. Notices to Lessor and Agent shall
be delivered or sent to the addresses hereinafter stated, to wit:
Lessor:
Global Eco-Logical Services, Inc.
C/O: Xxxxxxx X. Xxxxxx, Xx.
0 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
(000) 000-0000
Fax: (000) 000-0000
Lessee:
WasteMasters, Inc.
C/O: Xxxxxxx Xxxxxxx
000 Xxxxx Xxxxxxxx Xxx.
Xxxxxxxx Xxxx, XX 00000
(000) 000-0000
Fax: (000) 000-0000
All notices shall be effective upon delivery. Any party may change his
notice address upon written notice to the other parties.
26. Entire Agreement. This Lease contains the entire agreement of
the parties hereto, and no representations, inducements, promises or
agreements, oral or otherwise, between the parties not embodied herein,
shall be relied upon by the other party or be of any force or effect.
IN WITNESS WHEREOF, the parties herein have hereunto set their hands
and seals, in triplicate, the date and year first above written.
LESSEE:
WASTEMASTERS OF DELAWARE, INC.
/s/ Xxxxxxx Xxxxxxx
By: Xxxxxxx Xxxxxxx, Secretary
ATTEST:
________________________________
By: _____________________________
[SEAL]
LESSOR:
GLOBAL ECO-LOGICAL SERVICES, INC.
/s/ Xxxxxxx X. Xxxxxx
By: Xxxxxxx X. Xxxxxx, Xx., President
ATTEST:
________________________________
By: _____________________________
[SEAL]
Agreed and Assented to:
WASTEMASTERS, INC.
/s/ Xxxxxxx Xxxxxxx
By: Xxxxxxx Xxxxxxx, Secretary
ATTEST:
________________________________
By: _____________________________
[SEAL]
Exhibit A
Debenture Modification Agreements
SECOND AMENDMENT TO PROMISSORY NOTE
THIS SECOND AMENDMENT TO PROMISSORY NOTE is entered this 15th day of
September, 2000, by and between Global Eco-Logical Services, Inc., a
Florida corporation ("Maker"), WasteMasters, Inc., a Maryland corporation
("WMI"), and Beta Communications Corporation ("Noteholder").
WHEREAS, the Maker and the Noteholder are parties to a Promissory
Note dated June 1, 1999 in the original principal amount of $510,000.00;
WHEREAS, the Maker and the Noteholder entered into an Amendment to
Promissory Note dated March 1, 2000, to amend certain terms thereof;
WHEREAS, the Maker has agreed to sell certain assets to WMI, which
has agreed to assume payment of the Promissory Note, its accrued
interest, and permissible default fees, as partial consideration for the
Lease/Purchase and Management Agreement, and in connection with such
assumption, the Maker, WMI and the Noteholder have entered into this
Second Amendment to evidence the Noteholder's consent to the assumption
of the Promissory Not by WMI and the terms of an amendment to the
Promissory Note;
NOW, THEREFORE, in consideration of the promises and mutual
agreements herein contained, it is agreed by and between the parties
hereto as follows:
1. The Seventh Paragraph of the Note is hereby deleted and replaced
in its entirety with the following language:
"This Note shall be convertible, at the sole option of the Holder, into
paid and non-assessable shares of Common Stock of the Maker or
WasteMasters, Inc. ("WMI") as specified in a notice of conversion
delivered to the office of both the Maker and WMI at such places that
they may from time to time determine (all future references to "Common
Stock" in this paragraph shall refer to the Common Stock of WMI or the
Maker as specified in a notice of conversion). The number of shares of
Common Stock issuable upon conversion of this Note shall be equal to
$1,000.00 divided by the applicable Conversion Price in effect at the
time of conversion determined as hereinafter provided for each $1,000 in
principal and accrued interest due on this Note at the time of
conversion. The price at which shares of Common Stock shall be delivered
upon conversion (the "Conversion Price") shall be the Current Bid Price
(as hereinafter defined) of the Common Stock of the applicable company as
of the close of business on the day immediately preceding the date of
conversion; provided, however, that such Conversion Price shall be
subject to adjustment from time to time in certain instances as
hereinafter provided; and further provided that in no event shall the
Conversion Price for Common Stock of WMI be less than $0.10 per share. No
payment or adjustment shall be made in respect of dividends previously
declared and paid on the Common Stock upon conversion of part or
all of this Note into shares of Common Stock. If the Maker elects to
prepay part or all of this Note, such right of conversion shall cease and
terminate, as to the portion designated for prepayment, at the close of
business on the prepayment date, unless the Maker defaults in the
prepayment. No fractional shares of Common Stock will be issued, and
instead the number of shares of Common Stock to be issued on conversion
of this Note will, to the extent necessary, be rounded up to the nearest
whole number of shares."
2. The Noteholder hereby consents to the assumption of the
Promissory Note by WMI, and WMI hereby agrees to perform all obligations
of the Maker thereunder is if it were the original Maker thereunder.
3. In the event the Noteholder elects to convert any part of the
Promissory Note into shares of Common Stock of the Maker, then WMI shall
reimburse the Maker for such conversion by issuing the Maker that number
of shares of Common Stock of WMI which WMI would have been obligated to
issue the Noteholder if the Noteholder had instead elected to convert
such part of the Promissory Note into shares of Common Stock of WMI.
4. All terms and conditions in the Promissory Note shall remain
unchanged except to the extent specifically modified herein. All terms
defined in the Promissory Note shall have the same meaning herein that
they are defined to have the Promissory Note, unless specifically
provided otherwise.
IN WITNESS HEREOF, the parties have executed this Agreement, as of
the date first written above.
MAKER:
GLOBAL ECO-LOGICAL SERVICES, INC., a Florida corporation
By: ________________________________
Xxxxxxx X. Xxxxxx, Xx., President
HOLDER:
By: ________________________________
Print Name: _________________________
WMI:
WASTEMASTERS, INC., a Maryland corporation
By: ____________________________________
Xxxxxxx X. Xxxxxxx, Secretary
SECOND AMENDMENT TO PROMISSORY NOTE
THIS SECOND AMENDMENT TO PROMISSORY NOTE is entered this 15th day
of September, 2000, by and between Global Eco-Logical Services, Inc., a
Florida corporation ("Maker"), WasteMasters, Inc., a Maryland corporation
("WMI"), and Xxxxxxxxxxx Xxxxxxx ("Noteholder").
WHEREAS, the Maker and the Noteholder are parties to a Promissory
Note dated June 1, 1999 in the original principal amount of $850,000.00;
WHEREAS, the Maker and the Noteholder entered into an Amendment to
Promissory Note dated March 1, 2000, to amend certain terms thereof;
WHEREAS, the Maker has agreed to sell certain assets to WMI, which
has agreed to assume payment of the Promissory Note, its accrued
interest, and permissible default fees, as partial consideration for the
Lease/Purchase and Management Agreement, and in connection with such
assumption, the Maker, WMI and the Noteholder have entered into this
Second Amendment to evidence the Noteholder's consent to the assumption
of the Promissory Note by WMI and the terms of an amendment to the
Promissory Note;
NOW, THEREFORE, in consideration of the promises and mutual
agreements herein contained, it is agreed by and between the parties
hereto as follows:
1. The Seventh Paragraph of the Note is hereby deleted and replaced
in its entirety with the following language:
"This Note shall be convertible, at the sole option of the Holder, into
paid and non-assessable shares of Common Stock of the Maker or
WasteMasters, Inc. ("WMI") as specified in a notice of conversion
delivered to the office of both the Maker and WMI at such places that
they may from time to time determine (all future references to "Common
Stock" in this paragraph shall refer to the Common Stock of WMI or the
Maker as specified in a notice of conversion). The number of shares of
Common Stock issuable upon conversion of this Note shall be equal to
$1,000.00 divided by the applicable Conversion Price in effect at the
time of conversion determined as hereinafter provided for each $1,000 in
principal and accrued interest due on this Note at the time of
conversion. The price at which shares of Common Stock shall be delivered
upon conversion (the "Conversion Price") shall be the Current Bid Price
(as hereinafter defined) of the Common Stock of the applicable company as
of the close of business on the day immediately preceding the date of
conversion; provided, however, that such Conversion Price shall be
subject to adjustment from time to time in certain instances as
hereinafter provided; and further provided that in no event shall the
Conversion Price for Common Stock of WMI be less than $0.10 per share. No
payment or adjustment shall be made in respect of dividends previously
declared and paid on the Common Stock upon conversion of part or
all of this Note into shares of Common Stock. If the Maker elects to
prepay part or all of this Note, such right of conversion shall cease and
terminate, as to the portion designated for prepayment, at the close of
business on the prepayment date, unless the Maker defaults in the
prepayment. No fractional shares of Common Stock will be issued, and
instead the number of shares of Common Stock to be issued on conversion
of this Note will, to the extent necessary, be rounded up to the nearest
whole number of shares."
2. The Noteholder hereby consents to the assumption of the
Promissory Note by WMI, and WMI hereby agrees to perform all obligations
of the Maker thereunder is if it were the original Maker thereunder.
3. In the event the Noteholder elects to convert any part of the
Promissory Note into shares of Common Stock of the Maker, then WMI shall
reimburse the Maker for such conversion by issuing the Maker that number
of shares of Common Stock of WMI which WMI would have been obligated to
issue the Noteholder if the Noteholder had instead elected to convert
such part of the Promissory Note into shares of Common Stock of WMI.
4. All terms and conditions in the Promissory Note shall remain
unchanged except to the extent specifically modified herein. All terms
defined in the Promissory Note shall have the same meaning herein that
they are defined to have the Promissory Note, unless specifically
provided otherwise.
IN WITNESS HEREOF, the parties have executed this Agreement, as of
the date first written above.
MAKER:
GLOBAL ECO-LOGICAL SERVICES, INC., a Florida corporation
By: ________________________________
Xxxxxxx X. Xxxxxx, Xx., President
HOLDER:
By: ________________________________
Print Name: _________________________
WMI:
WASTEMASTERS, INC., a Maryland corporation
By: ____________________________________
Xxxxxxx X. Xxxxxxx, Secretary
SECOND AMENDMENT TO PROMISSORY NOTE
THIS SECOND AMENDMENT TO PROMISSORY NOTE is entered this 15th day of
September, 2000, by and between Global Eco-Logical Services, Inc., a
Florida corporation ("Maker"), WasteMasters, Inc., a Maryland corporation
("WMI"), and Pioneer Holdings, Inc. ("Noteholder").
WHEREAS, the Maker and the Noteholder are parties to a Promissory
Note dated June 1, 1999 in the original principal amount of $100,000.00;
WHEREAS, the Maker and the Noteholder entered into an Amendment to
Promissory Note dated March 1, 2000, to amend certain terms thereof;
WHEREAS, the Maker has agreed to sell certain assets to WMI, which
has agreed to assume payment of the Promissory Note, its accrued
interest, and permissible default fees, as partial consideration for the
Lease/Purchase and Management Agreement, and in connection with such
assumption, the Maker, WMI and the Noteholder have entered into this
Second Amendment to evidence the Noteholder's consent to the assumption
of the Promissory Note by WMI and the terms of an amendment to the
Promissory Note;
NOW, THEREFORE, in consideration of the promises and mutual
agreements herein contained, it is agreed by and between the parties
hereto as follows:
1. The Seventh Paragraph of the Note is hereby deleted and replaced
in its entirety with the following language:
"This Note shall be convertible, at the sole option of the Holder, into
paid and non-assessable shares of Common Stock of the Maker or
WasteMasters, Inc. ("WMI") as specified in a notice of conversion
delivered to the office of both the Maker and WMI at such places that
they may from time to time determine (all future references to "Common
Stock" in this paragraph shall refer to the Common Stock of WMI or the
Maker as specified in a notice of conversion). The number of shares of
Common Stock issuable upon conversion of this Note shall be equal to
$1,000.00 divided by the applicable Conversion Price in effect at the
time of conversion determined as hereinafter provided for each $1,000 in
principal and accrued interest due on this Note at the time of
conversion. The price at which shares of Common Stock shall be delivered
upon conversion (the "Conversion Price") shall be the Current Bid Price
(as hereinafter defined) of the Common Stock of the applicable company as
of the close of business on the day immediately preceding the date of
conversion; provided, however, that such Conversion Price shall be
subject to adjustment from time to time in certain instances as
hereinafter provided; and further provided that in no event shall the
Conversion Price for Common Stock of WMI be less than $0.10 per share. No
payment or adjustment shall be made in respect of dividends previously
declared and paid on the Common Stock upon conversion of part or
all of this Note into shares of Common Stock. If the Maker elects to
prepay part or all of this Note, such right of conversion shall cease and
terminate, as to the portion designated for prepayment, at the close of
business on the prepayment date, unless the Maker defaults in the
prepayment. No fractional shares of Common Stock will be issued, and
instead the number of shares of Common Stock to be issued on conversion
of this Note will, to the extent necessary, be rounded up to the nearest
whole number of shares."
2. The Noteholder hereby consents to the assumption of the
Promissory Note by WMI, and WMI hereby agrees to perform all obligations
of the Maker thereunder is if it were the original Maker thereunder.
3. In the event the Noteholder elects to convert any part of the
Promissory Note into shares of Common Stock of the Maker, then WMI shall
reimburse the Maker for such conversion by issuing the Maker that number
of shares of Common Stock of WMI which WMI would have been obligated to
issue the Noteholder if the Noteholder had instead elected to convert
such part of the Promissory Note into shares of Common Stock of WMI.
4. All terms and conditions in the Promissory Note shall remain
unchanged except to the extent specifically modified herein. All terms
defined in the Promissory Note shall have the same meaning herein that
they are defined to have the Promissory Note, unless specifically
provided otherwise.
IN WITNESS HEREOF, the parties have executed this Agreement, as of
the date first written above.
MAKER:
GLOBAL ECO-LOGICAL SERVICES, INC., a Florida corporation
By: ________________________________
Xxxxxxx X. Xxxxxx, Xx., President
HOLDER:
By: ________________________________
Print Name: _________________________
WMI:
WASTEMASTERS, INC., a Maryland corporation
By: ____________________________________
Xxxxxxx X. Xxxxxxx, Secretary
SECOND AMENDMENT TO PROMISSORY NOTE
THIS SECOND AMENDMENT TO PROMISSORY NOTE is entered this 15th day of
September, 2000, by and between Global Eco-Logical Services, Inc., a
Florida corporation ("Maker"), WasteMasters, Inc., a Maryland corporation
("WMI"), and Xxxxxx Xxxxx ("Noteholder").
WHEREAS, the Maker and the Noteholder are parties to a Promissory
Note dated June 1, 1999 in the original principal amount of $130,000.00;
WHEREAS, the Maker and the Noteholder entered into an Amendment to
Promissory Note dated March 1, 2000, to amend certain terms thereof;
WHEREAS, the Maker has agreed to sell certain assets to WMI, which
has agreed to assume payment of the Promissory Note, its accrued
interest, and permissible default fees, as partial consideration for the
Lease/Purchase and Management Agreement, and in connection with such
assumption, the Maker, WMI and the Noteholder have entered into this
Second Amendment to evidence the Noteholder's consent to the assumption
of the Promissory Note by WMI and the terms of an amendment to the
Promissory Note;
NOW, THEREFORE, in consideration of the promises and mutual
agreements herein contained, it is agreed by and between the parties
hereto as follows:
1. The Seventh Paragraph of the Note is hereby deleted and replaced
in its entirety with the following language:
"This Note shall be convertible, at the sole option of the Holder, into
paid and non-assessable shares of Common Stock of the Maker or
WasteMasters, Inc. ("WMI") as specified in a notice of conversion
delivered to the office of both the Maker and WMI at such places that
they may from time to time determine (all future references to "Common
Stock" in this paragraph shall refer to the Common Stock of WMI or the
Maker as specified in a notice of conversion). The number of shares of
Common Stock issuable upon conversion of this Note shall be equal to
$1,000.00 divided by the applicable Conversion Price in effect at the
time of conversion determined as hereinafter provided for each $1,000 in
principal and accrued interest due on this Note at the time of
conversion. The price at which shares of Common Stock shall be delivered
upon conversion (the "Conversion Price") shall be the Current Bid Price
(as hereinafter defined) of the Common Stock of the applicable company as
of the close of business on the day immediately preceding the date of
conversion; provided, however, that such Conversion Price shall be
subject to adjustment from time to time in certain instances as
hereinafter provided; and further provided that in no event shall the
Conversion Price for Common Stock of WMI be less than $0.10 per share. No
payment or adjustment shall be made in respect of dividends previously
declared and paid on the Common Stock upon conversion of part or
all of this Note into shares of Common Stock. If the Maker elects to
prepay part or all of this Note, such right of conversion shall cease and
terminate, as to the portion designated for prepayment, at the close of
business on the prepayment date, unless the Maker defaults in the
prepayment. No fractional shares of Common Stock will be issued, and
instead the number of shares of Common Stock to be issued on conversion
of this Note will, to the extent necessary, be rounded up to the nearest
whole number of shares."
2. The Noteholder hereby consents to the assumption of the
Promissory Note by WMI, and WMI hereby agrees to perform all obligations
of the Maker thereunder is if it were the original Maker thereunder.
3. In the event the Noteholder elects to convert any part of the
Promissory Note into shares of Common Stock of the Maker, then WMI shall
reimburse the Maker for such conversion by issuing the Maker that number
of shares of Common Stock of WMI which WMI would have been obligated to
issue the Noteholder if the Noteholder had instead elected to convert
such part of the Promissory Note into shares of Common Stock of WMI.
4. All terms and conditions in the Promissory Note shall remain
unchanged except to the extent specifically modified herein. All terms
defined in the Promissory Note shall have the same meaning herein that
they are defined to have the Promissory Note, unless specifically
provided otherwise.
IN WITNESS HEREOF, the parties have executed this Agreement, as of
the date first written above.
MAKER:
GLOBAL ECO-LOGICAL SERVICES, INC., a Florida corporation
By: /s/ Xxxxxxx Xxxxxx, Xx.
Xxxxxxx X. Xxxxxx, Xx., President
HOLDER:
By: ________________________________
Print Name: _________________________
WMI:
WASTEMASTERS, INC., a Maryland corporation
/s/ Xxxxxxx X. Xxxxxxx
By: Xxxxxxx X. Xxxxxxx, Secretary