THIS NOTE AND THE COMMON SHARES ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE
STATE SECURITIES LAWS. EXCEPT AS CONTEMPLATED BY THE SECURITIES PURCHASE
AGREEMENT AMONG AGU ENTERTAINMENT CORP., ITS DIRECT AND INDIRECT SUBSIDIARIES
AND THE ORIGINAL HOLDER OF THIS NOTE, THIS NOTE AND THE COMMON SHARES ISSUABLE
UPON CONVERSION OF THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS
NOTE OR SUCH UNDERLYING SHARES OF COMMON STOCK UNDER SAID ACT AND ANY APPLICABLE
STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO AGU
ENTERTAINMENT CORP. THAT SUCH REGISTRATION IS NOT REQUIRED.
SECURED CONVERTIBLE TERM NOTE
FOR VALUE RECEIVED, AGU Entertainment Corp. ("AGU"), a Delaware
corporation, The Tube Music Network, Inc., a Florida corporation, and Pyramid
Records International, Inc., a Florida corporation, (collectively the
"BORROWER"), hereby jointly and severally promise to pay to Xxxxxxxx
Entertainment Company, a Delaware limited liability company, 0000 XX 00xx
Xxxxxx, Xxxxx 000, Xxxxx, Xxxxxxx 00000 (the "HOLDER") or its registered assigns
or successors in interest, on order, the aggregate sum of Three Million Dollars
($3,000,000) (the "PRINCIPAL AMOUNT"), together with any accrued and unpaid
interest hereon, on December 19, 2006 (the "MATURITY DATE") if not sooner paid
or extended.
Capitalized terms used herein without definition shall have the
meanings ascribed to such terms in that certain Securities Purchase Agreement
dated as of the date hereof between the Borrower and the Holder (the "PURCHASE
AGREEMENT").
The following terms shall apply to this Note:
ARTICLE I
INTEREST
1.1 Interest Rate. Subject to Section 3.10, interest payable on this Note
shall accrue at a rate per annum (the "INTEREST RATE") equal to the lesser of
(a) the maximum rate permitted under applicable law, or (b) ten percent (10%)
per annum. Interest shall be calculated on the basis of a 360-day year. Interest
on the Principal Amount shall be payable monthly (pro-rated for partial months),
in arrears, commencing on January 1, 2005 and on the first day of each
consecutive calendar month thereafter and on the Maturity Date, whether by
acceleration or otherwise.
1.2 Prepayment. The Borrower may prepay all or any portion of the
outstanding Principal Amount at any time prior to the Maturity Date without the
consent of the Holder; provided that such prepayment shall be accompanied by all
interest that has accrued and remains unpaid with respect to the Principal
Amount being prepaid.
1.3 Additional Rights of the Holder. In the event the Borrower's
EBITDA for the calendar quarter ending September 30, 2006 shall not equal at
least $5,000,000, the Holder shall have the right (but not the obligation),
exercisable by delivery of written notice to the Borrower prior to the Maturity
Date, to extend the Maturity Date to March 31, 2007. If the Maturity Date is so
extended and the Borrower's EBITDA does not equal $5,000,000 for the calendar
quarter ending December 31, 2006 (this quarter and each quarter thereafter which
immediately precedes the calendar quarter ending on the then applicable Maturity
Date, is hereinafter referred to as an "EBITDA Measuring Quarter"), the Holder
shall have the right (but not the obligation), exercisable by delivery of
written notice to the Borrower prior to March 31, 2007, to extend the term of
the Note for an additional calendar quarter. The Holder shall then have the
continuing right (but not the obligation), exercisable by delivery of written
notice to the Borrower prior to the then applicable Maturity Date, to so extend
the term of the Note for an additional calendar quarter if the Borrower's EBITDA
for the applicable Measuring Quarter does not at least equal $5,000,000. For
purposes of this Agreement, the Borrower's EBITDA shall be its earnings before
interest, taxes, depreciation and amortization, as determined under generally
accepted accounting principles on a consolidated basis. The Borrower shall
notify the Holder in writing of the Borrower's EBITDA within 45 days of the end
of the applicable EBITDA Measuring Quarter, failing which the EBITDA shall be
deemed to be less than $5,000,000 for such period.
(b) In the event the Borrower's operating cash receipts do not at
least equal the Borrower's operating expenses for calendar year 2005, as
reasonably determined (and certified to) by the Borrower's Chief Financial
Officer, the Holder shall have the right, upon delivery of written notice to the
Borrower, to make all sums of principal and interest then remaining unpaid
hereon to be due and payable in 60 calendar days from the date of delivery of
such notice.
(c) In the event of the cessation, for any reason, of the active
participation of all of Xxxxxxx Xxx Xxxxxxx, Xxx Xxxxxxx and Xxxxx Xxxx in the
day-to-day business of the Company, the Holder shall have the right, upon
delivery of written notice to the Borrower, to make all sums of principal and
interest then remaining unpaid hereon to be due and payable in sixty (60)
calendar days from the date of delivery of such notice.
ARTICLE II
CONVERSION RIGHTS
2.1 Holder's Conversion Rights. The Holder shall have the right at any
time and from time to time, but not the obligation except as provided in Section
2.3 below, to convert all or any portion of the then aggregate outstanding
Principal Amount, together with interest due hereon, into shares of Common Stock
subject to the terms and conditions set forth in this Article II. In addition,
in the event all or any portion of the Principal Amount is prepaid pursuant to
Section 1.2 above, the Holder shall have the continuing right and option to
purchase shares of Common Stock upon all terms and conditions set forth in this
Article II with an aggregate purchase price equal to the Principal Amount so
prepaid. Such right and option shall expire on the Maturity Date, as extended,
pursuant to Section 1.3 hereof. The Holder may exercise such right by delivery
to the Borrower of a written notice of conversion not less than one (1) day
prior to the date upon which such conversion shall occur. The date upon which
such conversion shall occur is (the "Conversion Date").
2
2.2 Mechanics of Holder's Conversion. In the event and at each occurrence
that the Holder elects to convert all or any portion of this Note into Common
Stock, the Holder shall give notice of such election by delivering an executed
and completed notice of conversion ("NOTICE OF CONVERSION") to the Borrower and
such Notice of Conversion shall provide a breakdown in reasonable detail of the
Principal Amount and accrued interest being converted. On each Conversion Date
(as hereinafter defined) and in accordance with its Notice of Conversion, the
Holder shall make the appropriate reduction to the Principal Amount and accrued
interest as entered in its records (or deliver payment, as applicable) and shall
provide written notice thereof to the Borrower within two (2) business days
after the Conversion Date. Each date on which a Notice of Conversion is
delivered to the Borrower in accordance with the provisions hereof shall be
deemed a Conversion Date. A form of Notice of Conversion to be employed by the
Holder is annexed hereto as Exhibit A.
(b) Pursuant to the terms of the Notice of Conversion, the Borrower
will issue instructions to the transfer agent accompanied by an opinion of
counsel within three (3) business days of the date of the delivery to Borrower
of the Notice of Conversion and shall cause the transfer agent to transmit the
certificates representing the Conversion Shares to the Holder by crediting the
account of the Holder's designated broker with the Depository Trust Corporation
through its Deposit Withdrawal Agent Commission system, if then applicable, or
otherwise by issuing a certificate, within three (3) business days after receipt
by the Borrower of the Notice of Conversion. In the case of the exercise of the
conversion rights set forth herein the conversion privilege shall be deemed to
have been exercised and the Conversion Shares issuable upon such conversion
shall be deemed to have been issued upon the date of receipt by the Borrower of
the Notice of Conversion. The Holder shall be treated for all purposes as the
record holder of such Common Stock, unless the Holder provides the Borrower
written instructions to the contrary.
2.3 Mandatory Conversion. At any time after December 16, 2005, the
Borrower shall have the right to cause the Holder to convert the entire
Principal Amount into shares of Common Stock provided (a) all shares to be
acquired by the Holder shall be freely tradable without restriction whatsoever,
(b) the Principal Market for the Common Stock shall be either the NASD OTC
Bulletin Board, the NASDAQ SmallCap Market, the National Market System, the
American Stock Exchange or the New York Stock Exchange, (c) the Common Stock
shall have closed on the Principal Market at a price of not less than $5.00 per
share for ninety (90) consecutive trading days within the one hundred (100)
trading days terminating on the last trading day prior to the date of delivery
of the Mandatory Conversion Notice to the Holder, (d) the Borrower delivers to
the Holder a certificate of the President, Chief Financial Officer and Secretary
of the Borrower confirming that none of such persons knows of any fact or
circumstance affecting the Borrower that would reasonably and foreseeably cause
the closing price of the Common Stock to fall below $5.00 per share during the
next thirty (30) trading days on the Principal Market, and (e) no Event of
Default hereunder exists and is continuing.
3
2.4 Conversion Mechanics.
(a) The number of shares of Common Stock to be issued upon each
conversion of this Note shall be determined by dividing that portion of the
principal and interest to be converted, if any, by the then applicable
Conversion Price. The initial Conversion Price shall be $1.50 per share.
(b) The Conversion Price and number and kind of shares or other
securities to be issued upon conversion is subject to adjustment from time to
time upon the occurrence of certain events, as follows:
A. Stock Splits, Combinations and Dividends. In the event that
the Company shall (a) issue additional shares of the Common Stock as a dividend
or other distribution on outstanding Common Stock, (b) subdivide its outstanding
shares of Common Stock, or (c) combine its outstanding shares of the Common
Stock into a smaller number of shares of the Common Stock, then, in each such
event, the Conversion Price shall, simultaneously with the happening of such
event, be adjusted by multiplying the then Conversion Price by a fraction, the
numerator of which shall be the number of shares of Common Stock outstanding
immediately prior to such event and the denominator of which shall be the number
of shares of Common Stock outstanding immediately after such event, and the
product so obtained shall thereafter be the Conversion Price then in effect. The
Conversion Price, as so adjusted, shall be readjusted in the same manner upon
the happening of any successive event or events described herein in this
Section.
B. During the period the conversion right exists, the Borrower
will reserve from its authorized and unissued Common Stock a sufficient number
of shares to provide for the issuance of Common Stock upon the full conversion
of the principal amount of this Note. The Borrower represents that upon
issuance, such shares will be duly and validly issued, fully paid and
non-assessable. The Borrower agrees that its issuance of this Note shall
constitute full authority to its officers, agents, and transfer agents who are
charged with the duty of executing and issuing stock certificates to execute and
issue the necessary certificates for shares of Common Stock upon the conversion
of this Note.
C. Share Issuances. Subject to the provisions of this Section
2.4, if the Borrower shall at any time prior to the expiration of the Holder's
conversion rights, issue any shares of Common Stock or securities convertible
into Common Stock to a person other than the Holder for a consideration per
share (the "Offer Price") less than the Conversion Price in effect at the time
of such issuance, then the Conversion Price shall be immediately reset to such
lower Offer Price. For purposes hereof, the issuance of any security of the
Borrower convertible into or exercisable or exchangeable for Common Stock
("Convertible Securities") shall result in an adjustment to the Conversion Price
at the time of issuance of such Convertible Securities. Notwithstanding the
foregoing, no adjustment will be made under this Section 2.4 in respect of any
Excluded Stock. Excluded Stock" means any shares of Common Stock or Common Stock
equivalents issued or issuable to the persons and entities described on Schedule
4.3 of the Securities Purchase Agreement. This exclusion shall not apply to any
future issuances of Common Stock unless issued to one of the named individuals
or entities on such Schedule.
D. Reclassification, etc. If the Borrower at any time shall,
by reclassification or otherwise, change the Common Stock into the same or a
different number of securities of any class or classes, this Note, shall
thereafter be deemed to evidence the right to purchase an adjusted number of
such securities and kind of securities as would have been issuable as the result
of such change with respect to the Common Stock immediately prior to such
reclassification or other change.
4
E. EBITDA. In the event the Borrower's EBITDA for its calendar
quarter ended September 30, 2006 is not at least $5,000,000, the Conversion
Price shall be reset as of September 30, 2006 to the closing price of the Common
Stock on the Principal Market on the last trading day in such calendar quarter,
if such closing price is less than the Conversion Price in effect on such last
trading day.
2.5 Issuance of New Note. Upon any partial conversion of this Note, a new
Note containing the same date and provisions of this Note shall, at the request
of the Holder, be issued by the Borrower to the Holder for the principal balance
of this Note and interest which shall not have been converted or paid. The
Borrower will pay no costs, fees or any other consideration to the Holder for
the production and issuance of a new Note.
ARTICLE III
EVENTS OF DEFAULT
Upon the occurrence and continuance of an Event of Default beyond any
applicable grace period, the Holder may make all sums of principal, interest and
other fees then remaining unpaid hereon and all other amounts payable hereunder
immediately due and payable.
The occurrence of any of the following events respecting any of the
entities constituting the Borrower is an "EVENT OF DEFAULT":
3.1 Failure to Pay Principal, Interest or other Fees. The Borrower fails
to pay when due any installment of principal, interest or other fees hereon in
accordance herewith, or the Borrower fails to pay when due any amount due under
any other promissory note issued by Borrower, and in any such case, such failure
shall continue for a period of three (3) days following the date upon which any
such payment was due.
3.2 Breach of Covenant. The Borrower breaches any covenant or other term
or condition of this Note or the Purchase Agreement in any material respect and
such breach, if subject to cure, continues for a period of fifteen (15) days
after the occurrence thereof.
3.3 Breach of Representations and Warranties. Any material representation
or warranty of the Borrower made herein, in the Purchase Agreement, or in any
Related Document (as defined in the Purchase Agreement) shall be false or
misleading on the date that such representation or warranty was made or deemed
made, and if subject to cure, shall not be cured for a period of ten (10) days.
5
3.4 Receiver or Trustee. The Borrower shall make an assignment for the
benefit of creditors, or apply for or consent to the appointment of a receiver
or trustee for it or for a substantial part of its property or business; or such
a receiver or trustee shall otherwise be appointed.
3.5 Judgments. Any money judgment, writ or similar final process shall be
entered or filed against the Borrower or any of its property or other assets for
more than $200,000, and shall remain unvacated, unbonded or unstayed for a
period of thirty (30) days.
3.6 Bankruptcy. Bankruptcy, insolvency, reorganization or liquidation
proceedings or other proceedings or relief under any bankruptcy law or any law
for the relief of debtors shall be instituted by or against the Borrower.
3.7 Stop Trade. Upon commencement of trading on a Principal Market, an SEC
stop trade order or Principal Market trading suspension of the Common Stock
shall be in effect for ten (10) consecutive business days or ten (10) days
during a period of twenty (20) consecutive days, excluding in all cases a
suspension of all trading on a Principal Market, provided that the Borrower
shall not have been able to cure such trading suspension within thirty (30) days
of the notice thereof or list the Common Stock on another Principal Market
within sixty (60) days of such notice. The "Principal Market" for the Common
Stock shall include the NASD OTC Bulletin Board, NASDAQ SmallCap Market, NASDAQ
National Market System, American Stock Exchange, or New York Stock Exchange
(whichever of the foregoing is at the time the principal trading exchange or
market for the Common Stock, or any securities exchange or other securities
market on which the Common Stock is then being listed or traded.
3.8 Failure to Deliver Common Stock or Replacement Note. The Borrower
shall fail to timely deliver Common Stock to the Holder pursuant to and in the
form required by this Note, and Section 9 of the Purchase Agreement, if such
failure to timely deliver Common Stock shall not be cured within five (5) days.
If Borrower shall be required to issue a replacement Note to Holder and Borrower
shall fail to deliver such replacement Note within seven (7) business days of
the request for the replacement Note.
3.9 Default Under Related Agreements. The occurrence and continuance of
any Event of Default as defined in the Related Agreements.
3.10 Payment Grace Period. . Following the occurrence and continuance of
an Event of Default, the Borrower shall pay the Holder a default interest rate
of the lesser of (a) the maximum rate permitted by law, or (b) 18% per annum on
all amounts due and owing under the Note, which default interest shall be
payable upon demand. Presentment, demand, protest, notice of dishonor and all
other notices are hereby waived by Borrower.
3.11 Cumulative Remedies. The remedies under this Note shall be
cumulative.
ARTICLE IV
MISCELLANEOUS
4.1 Failure or Indulgence Not Waiver. No failure or delay on the part of
the Holder hereof in the exercise of any power, right or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such power, right or privilege preclude other or further exercise thereof or
of any other right, power or privilege. Holder shall not by any act, delay,
omission or otherwise be deemed to have waived any of its rights or remedies,
and no waiver of any kind shall be valid, unless in writing and signed by the
Holder. All rights and remedies existing hereunder are cumulative to, and not
exclusive of, any rights or remedies otherwise available.
6
4.2 Notices. Any notice herein required or permitted to be given shall be
in writing and shall be deemed effectively given: (a) upon personal delivery to
the party notified, (b) when sent by confirmed telex or facsimile if sent during
normal business hours of the recipient, if not, then on the next business day,
(c) five days after having been sent by registered or certified mail, return
receipt requested, postage prepaid, or (d) one business day after deposit with a
nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent to the
Borrower at the address provided in the Purchase Agreement executed in
connection herewith, and to the Holder at the address provided in the Purchase
Agreement for such Holder, with a copy to Xxxxxx X. Xxxxx, Xx., Esq., Loeb &
Loeb LLP, 00000 Xxxxx Xxxxxx Xxxxxxxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx
00000, facsimile number (000) 000-0000, and a copy to Xxxxxx X. Xxxxxxxxx Esq.,
0000 Xxxxx Xxxxxxxx Xxxxx, 0xx Xxxxx, Xxxxx, Xxxxxxx 00000, facsimile number
(000) 000-0000, or at such other address as the Borrower or the Holder may
designate by ten days advance written notice to the other parties hereto. A
Notice of Conversion shall be deemed given when made to the Borrower pursuant to
the Purchase Agreement.
4.3 Amendment Provision. The term "Note" and all reference thereto, as
used throughout this instrument, shall mean this instrument as originally
executed, or if later amended or supplemented, then as so amended or
supplemented, and any successor instrument issued pursuant to Section 2.5
hereof, as it may be amended or supplemented.
4.4 Assignability. This Note shall be binding upon the Borrower and its
successors and assigns, and shall inure to the benefit of the Holder and its
successors and assigns, and may be assigned by the Holder in accordance with the
requirements of the Purchase Agreement.
4.5 Governing Law. This Note shall be governed by and construed in
accordance with the laws of the State of Florida, without regard to principles
of conflicts of laws. Any action brought by either party against the other
concerning the transactions contemplated by this Agreement shall be brought only
in the state courts of Florida lying in Broward County, Florida, or in the
federal courts located in the State of Florida. Borrower agrees to submit to the
jurisdiction of such courts. In the event that any provision of this Note is
invalid or unenforceable under any applicable statute or rule of law, then such
provision shall be deemed inoperative to the extent that it may conflict
therewith and shall be deemed modified to conform with such statute or rule of
law. Any such provision which may prove invalid or unenforceable under any law
shall not affect the validity or unenforceability of any other provision of this
Note. Nothing contained herein shall be deemed or operate to preclude the Holder
from bringing suit or taking other legal action against the Borrower in any
other jurisdiction to collect on the Borrower's obligations to Holder, to
realize on any collateral or any other security for such obligations, or to
enforce a judgment or other court in favor of the Holder.
4.6 Maximum Payments. In no event shall the Holder be entitled to unearned
or unaccrued interest or other charges or rebates, except as may be authorized
by law, and should any interest or other charges paid by the Borrower or other
parties liable for the payment of this Note result in the computation or earning
of interest in excess of the maximum rate of interest that is legally permitted
under applicable law, then any and all such excess shall be and the same is
hereby waived by the Holder, and any and all such excess shall be automatically
credited against and reduce the balance due under this indebtedness, and the
portion of said excess which exceeds the balance due under this indebtedness,
shall be paid by the Holder to the Borrower and parties liable for the payment
of this Note. The Holder may, in determining the maximum rate permitted under
applicable law in effect from time to time, take advantage of (i) the maximum
rate of interest permitted under Florida law or federal law, whichever is
higher, including any laws regarding parity among lenders; and (ii) any other
law, rule or regulation in effect from time to time available to the Holder,
which exempts the Holder from any limit upon the rate of interest it may charge,
or grants to the Holder the right to charge a higher rate of interest than that
permitted by Chapter 687, Florida Statutes. In determining whether or not the
interest paid or payable under any specific contingency exceeds the highest
7
lawful rate, the Holder shall, to the maximum extent permitted under applicable
law (a) characterize any non-principal payment as an expense, fee or premium
rather than as interest, (b) exclude voluntary prepayments and the effects
thereof, and (c) "spread" the total amount of interest throughout the maximum
term of the obligation so that the interest rate is uniform throughout the
entire term of the obligation.
4.7 Security Interest. The holder of this Note has been granted a mortgage
and security interest in certain assets of the Borrower more fully described in
the Mortgage and Security Agreement.
4.8 Construction. Each party acknowledges that its legal counsel
participated in the preparation of this Note and, therefore, stipulates that the
rule of construction that ambiguities are to be resolved against the drafting
party shall not be applied in the interpretation of this Note to favor any party
against the other.
4.9 Cost of Collection. If default is made in the payment of this Note,
the Borrower shall pay to Holder all costs of collection, including reasonable
attorneys' fees, incurred through all levels of proceedings, whether suit be
instituted or not.
4.10 WAIVER OF TRIAL BY JURY. THE BORROWER AND THE HOLDER HEREBY MUTUALLY,
KNOWINGLY, WILLINGLY AND VOLUNTARILY WAIVE THEIR RIGHT TO TRIAL BY JURY AND NO
PARTY, NOR ANY ASSIGNEE, SUCCESSOR, HEIR, OR LEGAL REPRESENTATIVE OF THE PARTIES
(ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") SHALL SEEK A JURY
TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION
PROCEEDING BASED UPON OR ARISING OUT OF THIS NOTE OR THE LOAN DOCUMENTS, OR ANY
INSTRUMENT EVIDENCING, SECURING, OR RELATING TO THE INDEBTEDNESS AND OTHER
OBLIGATIONS EVIDENCED HEREBY OR ANY RELATED AGREEMENT OR INSTRUMENT, ANY OTHER
COLLATERAL FOR THE INDEBTEDNESS EVIDENCED HEREBY OR ANY COURSE OF ACTION, COURSE
OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS RELATING TO THE
LOAN OR TO THIS NOTE. THE PARTIES ALSO WAIVE ANY RIGHT TO CONSOLIDATE ANY ACTION
IN WHICH A JURY TRIAL HAS BEEN WAIVED, WITH ANY OTHER ACTION IN WHICH A JURY
TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY
NEGOTIATED BY THE PARTIES. THE WAIVER CONTAINED HEREIN IS IRREVOCABLE,
CONSTITUTES A KNOWING AND VOLUNTARY WAIVER, AND SHALL BE SUBJECT TO NO
EXCEPTIONS. THE HOLDER HAS IN NO WAY AGREED WITH OR REPRESENTED TO THE BORROWER
OR ANY OTHER PARTY THAT THE PROVISIONS OF THIS PARAGRAPH WILL NOT BE FULLY
ENFORCED IN ALL INSTANCES.
[Balance of page intentionally left blank; signature page follows.]
8
IN WITNESS WHEREOF, Borrower has caused this Convertible Term Note to be
signed in its name effective as of this 20th day of December, 2004.
AGU Entertainment Corp., a Delaware corporation
By: /s/ Xxxxx X. Xxxx
-----------------------------
Name: Xxxxx X. Xxxx
Title: President and Secretary
The Tube Music Network, Inc., a Florida corporation
By: /s/ Xxxxx X. Xxxx
------------------------------
Name: Xxxxx X. Xxxx
Title: President and Secretary
Pyramid Records International, Inc., a Florida
corporation
By: /s/ Xxxxx X. Xxxx
------------------------------
Name: Xxxxx X. Xxxx
Title: President and Secretary
9
EXHIBIT A
NOTICE OF CONVERSION
(To be executed by the Holder in order to convert all or part of the Note
into Common Stock)
AGU Entertainment Corp.
0000 Xxxx Xxxxxxx Xxxx Xxxxxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
The Undersigned hereby converts $_________ of the principal due on [SPECIFY
APPLICABLE REPAYMENT DATE] under the Convertible Term Note issued by AGU
Entertainment Corp. dated as of December 20, 2004 by delivery of Shares of
Common Stock of AGU Entertainment Corp. on and subject to the conditions set
forth in Article II of such Note.
1. Date of Conversion _______________________
2. Shares To Be Delivered: _______________________
By:_______________________________
Name:_____________________________
Title:______________________________
