EXHIBIT 10.6
LENDER CREDITOR AGREEMENT WITH ▇▇▇▇▇▇ ROCK DATED NOVEMBER 16, 2001
LENDER CREDITOR AGREEMENT
THIS LENDER CREDITOR AGREEMENT IS ENTERED INTO EFFECTIVE AS OF NOVEMBER 16,
2001 ("Creditor Agreement"), by ▇▇▇▇▇.▇▇▇, Inc., a Delaware corporation
("Debtor"), in favor of ▇▇▇▇▇▇ ROCK ("Secured Party").
Recitals
A. Secured Party has made numerous advances of money and extended certain
financial accommodations to Debtor pursuant to various promissory notes entered
into prior to the date hereof as set forth on Schedule 1 attached hereto, all
due and payable on, or before, November 21, 2001, (collectively, the "Loans").
B. Debtor has previously granted Secured Party a security interest in all of
Debtor's assets pursuant to a Security Agreement dated effective as of April 18,
2001 (the "Security Agreement").
C. Secured Party has agreed to extend the due date on the Loans for an
additional year subject to Debtor entering into this Creditor Agreement to
provide for certain financial covenants and other restrictions on Debtor's
ability to take certain actions, including but not limited to incurring further
debt.
Agreement
NOW, THEREFORE, in order to induce Secured Party to extend the due date on
the Loans through November 21, 2002, and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, and
intending to be legally bound, the parties hereby represent, warrant, covenant
and agree, as applicable, as follows:
1. LOAN EXTENSION. Secured Party hereby extends the due date on each of the
Loans to November 21, 2002, in consideration of the covenants and obligations of
Debtor set forth in Section 2 below. Each of the Loans shall be become
immediately due and payable if there is a material breach of this Creditor
Agreement by Debtor or an "Event of Default" under the Security Agreement.
2. DEBTOR COVENANTS. So long as any amount under the Loans remain
outstanding or there remains outstanding any Secured Obligation (as defined in
the Security Agreement), Debtor covenants and agrees that, in addition to the
covenants set forth in Section 6 of the Security Agreement, it shall not without
the written consent of Debtor which shall not be unreasonably withheld:
i. Incur any new indebtedness or expense in excess of $2,500
individually with respect to any third-party or any officer,
director or employee of Debtor (except for employee salaries
approved by the Board of Directors as of the date hereof and
reasonable and necessary legal and accounting professional
services as Debtor's CEO shall request in consultation with
Secured Party);
ii. Issue any additional securities, including but not limited to
stock, options, warrants or convertible notes (except for
securities existing as of the date hereof and any securities
issuable upon exercise or conversion of such securities);
iii. Sell or license any assets of Debtor except in the ordinary
course of business;
iv. File any lawsuits or take any other legal action against
third-parties except as may be required by applicable law;
v. Merge or otherwise effect a reorganization of Debtor; or
vi. Amend Debtor's Certificate of Incorporation or Bylaws.
3. MISCELLANEOUS.
3.1 No Waiver. None of the terms or provisions of this Creditor
Agreement may be waived, altered, modified or amended except by an instrument in
writing, duly executed by Debtor and Secured Party.
3.2 Termination of this Creditor Agreement. This Creditor Agreement
shall terminate upon the payment and performance in full of the Loans and
Secured Obligations.
3.3 Successor and Assigns. This Creditor Agreement and all obligations
of Debtor hereunder shall be binding upon the successors and assigns of Debtor,
and shall, together with the rights and remedies of Secured Party hereunder,
inure to the benefit of Secured Party, any future holder of any of the
indebtedness and their respective successors and assigns.
3.4 Governing Law. In all respects, including all matters of
construction, validity and performance, this Creditor Agreement and the
obligations arising hereunder shall be governed by, and construed and enforced
in accordance with, the laws of the State of California applicable to contracts
made and performed in such state, without regard to the principles thereof
regarding conflict of laws. The prevailing party in any dispute or lawsuit
arising out of or in connection with this Creditor Agreement shall be entitled
to recover its reasonable attorneys' fees, costs and expenses from the other
party. Venue for all purposes hereunder shall be the county in which Debtor's
principal place of business is located.
IN WITNESS WHEREOF, Debtor and Secured Party have caused this Lender
Creditor Agreement to be executed and delivered by their duly authorized
principals on the date first set forth above.
SECURED PARTY ▇▇▇▇▇.▇▇▇, INC.
Print Name______________________ By: _______________________
Signature ______________________ Printed
Name: _____________________
________________________________
Title: ____________________
