EXHIBIT 10.5
SCHEDULE "A"
FINANCING AGREEMENT
THIS AGREEMENT made effective as of the 5th day of October, 2000
AMONG:
XXXX XXXXXXX of 000 Xxxxxxxxx Xxxx, Xxxxxx Xxxxxx Xxxx,
Xxxxxxxx 00000
("Xxxx")
AND:
XXXXX SNEJDAR of 16 - 0000 Xxxxxx Xxx, Xxxxxxxx, Xxxxxxx
Xxxxxxxx X0X 0X0
("Xxxxx")
AND:
SECOND STAGE VENTURES, INC., a corporation incorporated under the
laws of the State of Nevada and having an office at P.O. Box 280,
92 Xxxx Xxxx, Windward Road, Providenciales, Turks & Caicos
Islands, B.W.I.
("Second Stage")
AND:
XXXXXXXXXX.XXX, INC., a corporation incorporated under the laws
of the State of Washington and having an office at Suite 400 -
107 000 Xxxx Xxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxx 00000
("EasyTrivia")
WHEREAS:
A. Second Stage is the registered and beneficial owner of all the issued and
outstanding shares in the capital of EasyTrivia.
B. Xxxx and Xxxxx are the sole directors and officers of EasyTrivia.
C. Pursuant to a Share Purchase Agreement made effective as of the 5th day of
October, 2000 among Brad, Brent, Second Stage and EasyTrivia, Second Stage
agreed to provide EasyTrivia with certain financing in order to allow EasyTrivia
to develop its online trivia game show business and Brad, Brent, Second Stage
and EasyTrivia agreed to enter into this Agreement.
NOW THEREFORE in consideration of the mutual covenants and agreements
hereinafter set forth, and in consideration of the sum of $2.00 paid by each
party to each of the other parties (the receipt and sufficiency of which
consideration is hereby acknowledged by all parties) the parties hereto agree as
follows:
1. THE FIRST ADVANCE
1.1 EasyTrivia acknowledges that it is currently indebted to Second Stage in
the amount of US$60,000 (the "First Advance"). The First Advance is evidenced by
a promissory note dated effective as of the 25th day of September, 2000 (the
"Promissory Note"), a copy of which is attached as Schedule "A" to this
Agreement.
2. THE SECOND ADVANCE
2.1 Second Stage will, on or before March 30, 2001, subject to the terms and
conditions of this Agreement, make further advances to EasyTrivia, not to
exceed, in the aggregate, US$65,000 (the "Second Advance"), for the purpose of
financing the business and operations of EasyTrivia.
3. THE THIRD ADVANCE
3.1 If, on May 31, 2001, EasyTrivia has cumulative cash revenues of at least
US$390,000:
(a) Second Stage will, by June 15, 2001, make a further advance of
US$100,000 (the "Third Advance") to EasyTrivia for the purpose of
financing the business and operations of EasyTrivia; and
(b) Xxxx and Xxxxx will each have the option, exercisable by delivering a
written notice to Second Stage before June 15, 2001, to purchase 49 of
the issued and outstanding common shares in the capital of EasyTrivia
from Second Stage for US$1.00 per share. 3.2 If, on May 31, 2001,
EasyTrivia has cumulative cash revenues of at least US$390,000 and
Second Stage does not make the Third Advance to EasyTrivia by June 15,
2001, Xxxx and Xxxxx will each have the option, exercisable by
delivering a written notice to Second Stage before July 2, 2001, to
purchase from Second Stage 100 of the issued and outstanding common
shares in the capital of EasyTrivia and 50% of the then outstanding
indebtedness of EasyTrivia to Second Stage for a purchase price of
US$100. The option to purchase contained in this Section 3.2 will be
the only remedy available to Xxxx and Xxxxx for a failure by Second
Stage to make the Third Advance.
-2-
4. MUTUAL RELEASES
4.1 If Xxxx and Xxxxx exercise the option to purchase contained in Section 3.2
of this Agreement, the parties to this Agreement will, on the closing of the
transaction contemplated by Section 3.2, provide mutual releases of and from all
manner of claims whatsoever in a form satisfactory to the parties solicitors.
5. ALLOTMENT OF SHARES
5.1 The parties agree that no additional common shares in the capital of
EasyTrivia or securities, options, warrants or other rights to acquire common
shares in the capital of EasyTrivia will be allotted or issued by EasyTrivia
before August 1, 2001 without the prior written consent of Second Stage, Xxxx
and Xxxxx.
6. COMPULSORY BUY-OUT
6.1 If Xxxx and Xxxxx exercise the option to purchase contained in Section
3.1(b) and Xxxx and Xxxxx each purchase 49 of the issued and outstanding common
shares in the capital of EasyTrivia from Second Stage as contemplated therein,
then at any time after such purchase either of Xxxx or Xxxxx (the "Offeror") may
send a notice (the "Notice") to the other (the "Other") which shall contain an
offer to purchase all of the issued and outstanding common shares in the capital
of EasyTrivia owned by the Other at the price and on the terms set out therein,
and an offer to sell all of the issued and outstanding common shares in the
capital of EasyTrivia owned by the Offeror at the same price and on the same
terms.
6.2 The Other may, within seven days after receipt of the Notice, accept either
of the offers contained therein and if the offer to purchase is accepted or if
the Other does not accept either offer within the seven day period, then the
Other shall sell and the Offeror shall purchase all of the issued and
outstanding common shares in the capital of EasyTrivia owned by the Other all in
accordance with the Notice.
6.3 If the Other accepts the offer to sell all of the issued and outstanding
common shares in the capital of EasyTrivia owned by the Offeror then the Other
shall purchase and the Offeror shall sell all the said shares all in accordance
with the Notice.
6.4 Notwithstanding any closing date stipulated in the Notice, the closing of
the purchase and sale shall take place on the date which is seven business days
following the acceptance or deemed acceptance of either of the offers contained
in the Notice by the Other.
6.5 If the purchaser defaults in payment of the purchase price in full and such
default is not cured within 15 days, the vendor, in addition to any other rights
he may have, may by notice to the purchaser terminate the agreement for the sale
of the issued and outstanding common shares in the capital of EasyTrivia owned
by him and elect to purchase the issued and outstanding common shares in the
capital of EasyTrivia owned by the purchaser at the price and on the terms set
out in the notice and the transaction shall be completed on the 21st day after
such default has occurred.
-3-
7. GENERAL
7.1 This Agreement will enure to the benefit of and be binding upon the parties
and their respective successors and assigns.
7.2 The parties to this Agreement covenant to execute and deliver such further
and other documents, conveyances, agreements and transfers as may be necessary
to give effect to this Agreement.
7.3 Time shall be of the essence of this Agreement and of the transactions
contemplated by this Agreement.
7.4 No change or modification of this Agreement will be valid unless it is in
writing and signed by the parties to this Agreement.
7.5 This Agreement and any documents and agreements to be delivered pursuant to
this Agreement supersede all previous invitations, proposals, letters,
correspondence, negotiations, promises, agreements, covenants, conditions,
representations and warranties with respect to the subject matter of this
Agreement. There is no representation, warranty, collateral term or condition or
collateral agreement affecting this Agreement, other than as expressed in
writing in this Agreement.
7.6 It is intended that all of the provisions of this Agreement will be fully
binding and effective between the parties. If any particular provision or
provisions or a part of one or more is held to be invalid, illegal, void,
voidable or unenforceable for any reason whatsoever, then the particular
provision or provisions or part of the provision will be deemed severed from the
remainder of this Agreement. The remainder of this Agreement will not be
affected by the severance and will remain in full force and effect.
7.7 Each party confirms and agrees that Xxxxxxx & Xxxxxx is acting solely for
Second Stage in connection with the negotiation and preparation of this
Agreement. Xxxx, Xxxxx and EasyTrivia confirm and agree that they have each been
duly advised (and fully and fairly informed with respect to such matters) to
obtain all necessary and independent legal and other applicable professional
advice and counsel prior to entering into this Agreement. Xxxx, Xxxxx and
EasyTrivia have either obtained all such advice and counsel or have determined
to their own satisfaction, having been fully and fairly informed therein, not to
seek such advice and counsel.
7.8 This Agreement may be executed in any number of counterparts with the same
effect as if all parties had signed the same document. All of these counterparts
will for all purposes constitute one agreement, binding on the parties,
notwithstanding that all parties are not signatories to the same counterpart. A
fax transcribed copy or photocopy of this Agreement executed by a party in
counterpart or otherwise will constitute a properly executed, delivered and
binding agreement or counterpart of the executing party.
7.9 This Agreement will be governed by and construed in accordance with the
laws of British Columbia and the laws of Canada applicable in such Province.
-4-
7.10 All notices and other communications given in connection with this
Agreement shall be in writing and shall, except in the event of a mail strike,
during which time all notices may be personally delivered, be sufficiently given
if delivered in person or sent by registered mail, postage prepaid, to the
parties at the addresses set forth on page 1 hereof. Any such notices or other
communications sent by registered mail addressed as aforesaid shall be deemed to
be received by the addressee thereof on the fifth business day after the mailing
thereof. Any such notices personally delivered shall be deemed delivered on the
day of delivery. Any party hereto may change its address for service by notice
in writing to the other parties hereto.
IN WITNESS WHEREOF the parties have duly executed this Agreement to be effective
as of the date first written above.
SIGNED, SEALED & DELIVERED by )
XXXX XXXXXXX in the presence of: )
)
)
----------------------------------------) -----------------------------------
Signature of Witness ) XXXX XXXXXXX
)
Name: )
----------------------------------------)
Address: )
----------------------------------------)
)
----------------------------------------)
Occupation: )
)
----------------------------------------)
SIGNED, SEALED & DELIVERED by )
XXXXX SNEJDAR in the presence of: )
)
)
----------------------------------------) -----------------------------------
Signature of Witness ) XXXXX SNEJDAR
)
Name: )
----------------------------------------)
Address: )
----------------------------------------)
)
----------------------------------------)
Occupation: )
)
----------------------------------------)
-5-
SECOND STAGE VENTURES, INC.,
by its authorized signatory:
---------------------------------------
Authorized Signatory
XXXXXXXXXX.XXX, INC.,
by its authorized signatory:
---------------------------------------
Authorized Signatory
-6-
