AMENDMENT NO. 1 TO THE CLASS A COMMON STOCK
AND INSTALLMENT PAYMENT AGREEMENT
AMENDMENT NO. 1 TO THE CLASS A COMMON STOCK AND INSTALLMENT PAYMENT
AGREEMENT, dated as of June 30, 2005 (this "Amendment"), to the Class A Common
Stock and Installment Payment Agreement, dated as of June 30, 2004 (as so
amended, and as it in the future may be amended, modified or supplemented from
time to time in accordance with its terms, the "Agreement"), by and among Xxxxxx
Xxxxxxx Promotions, Inc., a Delaware corporation (hereinafter, "CKP"), and each
of Redwood Holdings Limited, Platinum Partners Value Limited Arbitrage Fund,
L.P. and WEC Partners LLC (collectively, the "Investors").
WHEREAS, CKP has agreed to pay certain Installment Payment Amounts to
the Investors which are due and payable to the Investors on a quarterly basis;
and
WHEREAS, CKP currently owes the Investors the aggregate amount of
$90,000, and an additional $30,000 is due and payable to the Investors on or
before June 30, 2005;
WHEREAS, the parties hereto have agreed to amend certain provisions of
the Agreement as set forth in this Amendment; and
WHEREAS, the effectiveness of this Amendment is subject to the
satisfaction of the conditions precedent set forth in Section 4 of this
Amendment.
Capitalized terms used but not defined in this Amendment shall have
the meanings given to such terms in the Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
legal sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Amendment to Agreement. (a) CKP agrees to pay to the Investors, on a pro
rata basis, the Installment Payment Amount of $120,000 in full at the closing of
the transactions contemplated under this Amendment, which payment shall be made
by CKP as follows: (i) $60,000 shall be paid by CKP in cash via wire transfer to
each Investor, on a pro rata basis, in accordance with the wire instructions
provided to CKP by each Investor, and (ii) immediate delivery of certificates
representing the aggregate amount of 750,000 "restricted" shares (the "Shares")
of the common stock, par value $.01 per share, of CKP, which Shares shall be
issued in the name of the Investors, on a pro rata basis, to the address
provided to CKP by each Investor. Following such issuance, the Investor shall
own all right, title and interest in the Shares, and CKP shall have no further
obligations or liabilities to the Investors for any Installment Payment Amount
due to the Investors for the period from the date of the Agreement through and
including June 30, 2005.
(b) Notwithstanding anything to the contrary contained in the
Agreement, for the period commencing July 1, 2005 through and including December
31, 2005, CKP agrees to pay to the Investors, on a pro rata basis, an amount
equal to the product of fourteen and four tenths percent (14.4%) per annum
multiplied by the then outstanding investment amount of the Investors under the
Operating Agreement (the "Extension Period Amount"), which amount shall accrue
daily and be payable in cash in a lump sum on December 31, 2005 or until the
date the Investors receive payments in cash equal to the Investor's investment
amount of $1,000,000 (the "Total Payment Amount"), either in payments or
distributions under the Operating Agreement in accordance with its terms or as a
result of: (i) payments by CKP to the Investors under that certain Guaranty and
Pledge Agreement, dated as of June 30, 2004, as amended as of the date hereof,
by CKP in favor of the Investors, (ii) payments by World Wide South Beach, LLC
("WWSB") to the Investors under that certain Guaranty, dated as of June 30,
2005, by WWSB in favor of the Investors, or (iii) payments or distributions from
any other person, including third party financing sources and investors.
Following the date upon which the Total Payment Amount is paid to the Investors,
any amounts due under Section 2(a) of the Agreement, including the Extension
Period Amount, shall cease to accrue.
2. Waiver of Event of Default. The Investors hereby agree to waive any and
all default, breaches of any covenants, breaches of any representations or
warranties, or Events of Default under the Agreement from the date of the
Agreement through the date of closing under the Amendment.
3. Representations and Warranties. In order to induce the parties to enter
into this Amendment, each party hereby, represents and warrants to each of the
parties as of the date hereof as follows (which representations and warranties
shall survive the execution and delivery of this Amendment):
(a) Each party, has the requisite power to execute, deliver and carry out
the terms and provisions of this Amendment;
(b) The execution, delivery and performance of this Amendment has been
duly authorized in accordance with the power and authority of each party and
constitutes the legal, valid and binding obligation of each party, and is
enforceable against each party in accordance with its terms subject (i) as to
enforcement of remedies, to applicable bankruptcy, insolvency, reorganization,
moratorium and other similar laws affecting the enforcement of creditors' rights
generally, from time to time in effect, and (ii) to general principles of
equity; and
(c) After giving effect to this Amendment, no event shall have occurred
and be continuing which constitutes or would constitute a default or an Event of
Default under the Agreement.
4. Conditions Precedent. Notwithstanding any term or provision of this
Amendment to the contrary, Section 1 hereof shall not become effective until
each of the parties shall receive fully executed counterparts of each of the
following documents: (i) this Amendment, (ii) Amendment No. 1 to Guaranty and
Pledge Agreement, dated as of the date hereof, by and between CKP and the
Investors, (iii) First Amendment to the Limited Liability Company Agreement of
Pledge This Holdings, LLC, a Delaware limited liability company, (iv)
Distribution Interest Redemption Agreement, dated of the date hereof, by and
among Pledge This Holdings and the Investors, and (v) Guaranty Agreement, dated
as of the date hereof, by WWSB in favor of the Investors.
5. References to Agreement. The term "Agreement", "hereof", "herein" and
similar terms as used in the Amendment, and references in the Agreement shall
mean and refer to, from and after the effective date of the amendments contained
herein as determined in accordance with Section 4 hereof, the Agreement, as
amended by this Amendment.
6. Continued Effectiveness. Nothing herein shall be deemed to be a waiver
of any covenant or agreement contained in, or any default or Event of Default
under, the Agreement, except as expressly provided for hereby, and each of the
parties hereto agrees that, as amended by this Amendment, all of the covenants
and agreements and other provisions contained in the Agreement shall remain in
full force and effect from and after the date of this Amendment.
7. Counterparts. This Amendment may be executed in two or more
counterparts, each of which shall be an original, and all of which, when taken
together, shall constitute a single instrument. Delivery of an executed
counterpart of a signature page to this Amendment by telecopier shall have the
same effectiveness as delivery of a manually executed counterpart of this
Amendment.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective officers thereunto duly authorized as of the
day and year first written above.
XXXXXX XXXXXXX PROMOTIONS, INC.
By: /s/ Xxx XxXxxxxxx
-----------------
Xxx XxXxxxxxx
Executive Vice President
REDWOOD HOLDINGS LIMITED
By:_________________________________________
Name:
Title:
PLATINUM PARTNERS VALUE ARBITRAGE FUND L.P.
By:________________________________________
Name:
Title:
WEC PARTNERS LLC
By:_________________________________________
Name:
Title:
