Sports Funding, Inc eAutoclaims, Inc
0000 X. Xxxxxxxx Xx. 000 Xxxx Xxxxxxx Xxxx
Xxxxx, XX 00000 Xxxxxxx, XX 00000
Gentlemen:
This Letter Agreement (the "Agreement") is entered into by and among
eAutoclaims, Inc.
a Nevada corporation ("eAuto"), Sports Funding, Inc ("Sports Funding"), holder
of a $275,000 convertible promissory note dated July 10, 2003 and the parties
identified on the signature pages as the Purchasers ("Purchasers").
RECITALS
This Agreement is entered into with reference to the following facts:
A. Sports Funding is the owner of the Note convertible into 985,663
shares of eAuto common stock at $0.279 per share. The note has a
maturity date of August 10, 2005, and later amended by Letter
Agreement, to August 17th, 2005.
B. To facilitate the conversion of this debt to equity, eAuto is
willing to reduce the conversion price of the convertible note to
$0.16 per share.
C. Sports Funding agrees to convert the Note into shares of eAuto
common stock, $.001 par value ("Common Stock"), and to sell those
shares to Purchasers.
D. Purchasers desire to purchase the Common Stock issued to Sports
Funding upon conversion of the Note.
E. The newly issued shares will be issued to the purchaser in Street
name as indicated in Exhibit "A".
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AGREEMENT TERMS
1. Conversion of Note; Issuance of Certificates. Sports Funding hereby
notifies eAuto that it desires to convert the Note into 1,718,750 shares
of Common Stock ("Conversion Shares"), for the purpose of this
transaction only. Sports Funding represents it is not an "affiliate" of
eAuto as defined in Rule 144 under the Securities Act of 1933 and has
held the note in excess of two years. Accordingly, eAuto will cause its
transfer agent to issue the Conversion Shares without a restrictive
legend.
2. Purchase of Shares by_Purchasers. Purchasers will purchase all of the
Conversion Shares for an aggregate purchase price of $275,000 (i.e $.16
per share). Purchasers and Sports Funding agree that Johnson, Pope,
Xxxxx, Xxxxxx & Xxxxx, LLP will act as escrow agent ("Escrow Agent") to
facilitate the transactions contemplated by this Agreement. Purchasers
will deliver the purchase price for the Conversion Shares to the Escrow
Agent in immediately available funds, as per wiring instructions
indicated on Exhibit B. At such time as Escrow Agent has received the
purchase price proceeds, it shall notify eAuto, Sports Funding and
Purchasers by email or facsimile. When Escrow Agent receives confirmation
either by email or facsimile from Sports Funding and Purchasers that it
is authorized to consummate this transaction, it will distribute the
purchase price proceeds for the Conversion Shares as follows: $225,000 to
an account designated by Sports Funding; $50,000 to eAuto in the account
designated in Exhibit C; and shall instruct eAuto to cause its transfer
agent to distribute the 1,718,750 Conversion Shares without legend to
Purchasers.
If for any reason all parties do not consent to this transaction within
three (3) business days after the notice from Escrow Agent, then Escrow
Agent shall return the purchase price proceeds to Purchasers and
reestablish the convertible note back to Sports Funding in its original
terms and conditions.
3. Severability. If any part of this Agreement shall be determined to be
illegal, invalid or unenforceable, that part shall be severed from the
Agreement and the remaining parts shall be valid and enforceable.
4. Counterparts. This Agreement may be executed in counterparts, each of
which shall constitute a duplicate original.
5. Authority To Execute Agreement. The individuals signing this Agreement
and the parties represent and warrant that they have full and complete
authority and authorization to execute and effect this Agreement and to
take or cause to be taken all acts contemplated by this Agreement.
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6. Governing Law. This Agreement and all matters arising out of or relating
to this Agreement shall be governed by, interpreted and construed in
accordance with the procedural and substantive laws of the State of
Florida, and shall be deemed executed in Clearwater, Florida.
7. Jurisdiction. The parties agree that any legal action or proceeding
relating to this Agreement shall be instituted in a state or federal
court in Pinellas County, Florida. The parties agree to submit to the
exclusive jurisdiction of, and agree that venue is proper in, these
courts in any such action or proceeding.
8. Entire Agreement. This Agreement constitutes the entire agreement between
the parties and supersedes any and all prior or contemporaneous
agreements or representations, written or oral, between the parties
concerning the subject matter of this Agreement. This Agreement may not
be modified or amended except in writing and signed by a duly authorized
representative of each party; no other act, document, usage, or custom
shall be deemed to amend or modify this Agreement.
9. Successors, Assigns and Affiliates. The terms and conditions of this
Agreement shall apply to successors and assigns of all parties.
10. Release. Subject to the consummation of the transactions set herein and
as a condition thereof and except for the performance by the parties of
the provisions of this Agreement and further except for the
representations, warranties and indemnities of the parties contained
herein (which representations, warranties and indemnities shall survive
the consummation of this Agreement and as to which the parties shall
continue to be liable), each party hereto, for itself and on behalf of
all direct and indirect partners, officers, directors, employees,
affiliates (both persons and entities), representatives, agents,
representatives, servants, trustees, beneficiaries, predecessors in
interest, successors in interest, assigns, nominees and insurers
(collectively, the "Releasing Parties"), shall be deemed to have released
and forever discharged each of the other parties hereto and all direct
and indirect partners, officers, directors, employees, affiliates (both
persons and entities), representatives, agents, representatives,
servants, trustees, beneficiaries, predecessors in interest, successors
in interest, assigns, nominees and insurers of each such party, of and
from any and all claims, demands, actions and causes of action, whether
known or unknown, fixed or contingent, that any of the Releasing Parties
may have had, may now have or may hereafter acquire with respect to any
matters whatsoever arising under or in any way related to (i) the
Convertible Note term sheet, and (ii) any claims either party may have
against the other with respect to or in connection with any alleged
violation of any state or Federal securities laws, including the
Securities Act and the Exchange Act.
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11. Effective Date. The Effective Date of this Agreement shall be the later
date on which this Agreement is executed by all parties below.
eAUTOCLAIMS, INC SPORTS FUNDING, INC
By: _______________________________ By: ___________________________
Name: ____________________________ Name: _________________________
Title: _____________________________ Title: __________________________
Date: _____________________________ Date: __________________________
[PURCHASERS] [PURCHASERS]
By: _______________________________ By______________________________
Name: ____________________________ Name: __________________________
Title: _____________________________ Title: ___________________________
Date: _____________________________ Date: ___________________________
Number of Shares:____________________ Number of Shares:__________________
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