SECOND DEBENTURE EXTENSION AGREEMENT
Exhibit
10.1
This
Second Debenture Extension Agreement (“Agreement”) is made
and entered into as of July 20, 2010, by and among, China Digital Media
Corporation, a Nevada corporation (“Company”) and Vision Opportunity Master
Fund, Ltd., a Cayman corporation (“Vision”).
WHEREAS, on December 8, 2008,
the Company and Vision entered into a Debenture Extension Agreement, as amended
on May 7, 2009;
WHEREAS, the Debenture
Extension Agreement extended the maturity date of the original Debenture issued
to Vision to June 30, 2010;
WHEREAS, the outstanding
principal of the Debenture in the amount of $1,914,250.00 (“Principal”) was not
repaid on or before June 30, 2010;
WHEREAS, the Company wishes
for Vision to extend the date for repayment of the Principal until December 31,
2011 and Vision has, therefore, requested as consideration for this second
extension, (i) that the Company pay one hundred thousand dollars ($100,000.00)
in cash to Vision upon execution of this Agreement and on or before June 30,
2011; (ii) that the Company pay Vision ten percent (10%) of the outstanding
principal of the Debenture in cash on or before December 31, 2010; and (iii)
that the conversion price of the Debenture be reduced to $0.15.
NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties intending to be legally bound, hereby
agree as follows:
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Capitalized
Terms. Capitalized terms used, but not defined, herein, shall have
the meanings ascribed to such terms in the
Debenture.
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| 10 | ) |
Extension of Maturity
Date. Company and Vision hereby agree that the Maturity
Date of the Debenture shall be extended to December 31,
2011.
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| 11 | ) |
Reduction of
Conversion Price of Debenture. Company and Vision hereby
agree that the conversion price of the Debenture shall be reduced to
$0.15.
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Amortizing Principal
Payments. Company and Vision hereby agree that upon execution
of this Agreement AND on or before June 30, 2011, Company shall pay Vision
one hundred thousand dollars ($100,000.00) in cash. In
addition, Company and Vision hereby agree that Company shall pay Vision,
on or before December 31, 2010, in cash, an amount equal to ten percent
(10%) of the then outstanding principal amount of the
Debenture. All payments received pursuant to this section shall
reduce the outstanding principal of the Debenture upon
receipt.
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Interest. Company
and Vision hereby agree that interest on the Debenture shall continue to
accrue on the outstanding principal at an interest rate equal to ten
percent (10%) and shall continue to be payable
quarterly.
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| 14 | ) |
Defaults. Failure
to timely pay any interest pursuant to the terms of this Agreement shall
be considered an “Event of Default” as defined in the
Debenture.
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Prepayments. Company
shall be entitled to prepay principal at anytime before December 31,
2011. In the event any amount of principal is prepaid by
Company before December 31, 2011, interest payments thereafter shall
be calculated on the then outstanding principal.
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Terms and Conditions of Debenture. Except
as
expressly set forth herein, all
of the terms and conditions to the Debenture shall continue in full force
and effect after the execution of this Agreement and shall
not be in any way changed, modified or superseded by the terms set forth
herein.
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[REMAINDER
OF THE PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, Company
and Vision have executed this Agreement as of the date set forth
above.
CHINA
DIGITAL MEDIA CORPORATION
By: ______________
Name: ______________
Its: ______________
Date:______________
VISION
OPPORTUNITY MASTER FUND LTD.
By: ______________
Name: ______________
Its: ______________
Date:______________