EXHIBIT 10.14
98
Form of Amended and Restated Senior Loan Agreement, 25% Convertible Promissory
Note, Personal Guaranty Agreement and Subsidiary Guaranty Agreement, together
with schedule required by instruction 2 to the Item 601 (a) of regulation S-K.
Lender Amount of Loan Date of Loan
Green Acres Partners LLC $350,000 1-30-15
San ▇▇▇▇▇▇▇ Advisors, LLC $ 50,000 1-30-15
San ▇▇▇▇▇▇▇ Advisors, LLC $ 50,000 1-30-15
Green Acres Partners, LLC $350,000 3-01-15
San ▇▇▇▇▇▇▇ Advisors, LLC $150,000 3-01-15
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EXHIBIT 10.14
Continued
100
AMENDED AND RESTATED
SENIOR LOAN AGREEMENT
This Amended and Restated Senior Loan Agreement (this "Agreement"), dated
February 5, 2015, is by and between Green Acres Partners A, LLC, a Nevada
limited liability company (the "Lender"), on the one hand, and Strainwise, Inc.,
a Utah corporation (the "Borrower"), on the other hand.
RECITALS
WHEREAS, the Lender desires to provide the Borrower with a loan to meet its
capital needs;
WHEREAS, the Borrower has indicated that it wishes to borrow an aggregate
of up to TWO MILLION THREE HUNDRED THOUSAND DOLLARS ($2,300,000); and
WHEREAS, the parties desire that the Lender will loan the Borrower money to
be used to meet its capital needs;
WHEREAS, the parties entered into a Senior Loan Agreement on January 30,
2015, and enter into this Agreement which amends and restates, but does not
extinguish, impair, novate or discharge the obligations evidenced by that
certain Senior Loan Agreement, dated January 30, 2015, executed by the Borrower
in favor of the Lender.
NOW THEREFORE, in consideration of the foregoing recitals, mutual covenants
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereby agree as set
forth below.
1. Principal. Upon receipt of funds, the Borrower promises to
unconditionally pay to the order of the Lender the aggregate principal amount
set forth in Schedule A of the promissory note (the "Loan Amount"), together
with interest pursuant to this Agreement and the corresponding promissory note
documenting the Loan Amount. Repayment of the Loan Amount shall be subject to
the terms and conditions of the Amended and Restated 25% Senior Promissory Note,
attached hereto as Exhibit A (the "Note"), to be issued to the Lender upon
receipt of funds.
2. Interest Rate. The rate of simple interest for the Loan Amount shall be
TWENTY-FIVE PERCENT (25%) per annum and will be due as provided in the Note.
3. Personal Guaranties. Funding of the Loan Amount is conditioned upon
receipt of the personal guaranties of ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇▇ as
set forth in the Amended and Restated Personal Guaranty, attached hereto as
Exhibit B.
4. Subsidiary Guarantee. Funding of the Loan Amount is conditioned upon
receipt of the guaranty of Strainwise, Inc., a Colorado corporation and wholly
owned subsidiary of the Borrower as set forth in the Amended and Restated
Subsidiary Guaranty, attached hereto as Exhibit C.
5. Conversion Rights. The principal amount of the Note and any accrued but
unpaid interest thereon, are convertible into shares of common stock of the
Borrower (the "Common Stock") as provided in the Note (the "Conversion Shares").
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6. Registration Procedures.
6.1. Demand Rights. From the date hereof, until the date which is three (3)
years from the date hereof (the "Demand Period"), subject to the terms and
conditions of this Agreement, the Lender will have in the single opportunity, in
addition to other rights enumerated in this Agreement, to request registration
under the Securities Act of 1933, as amended (the "Securities Act") of all or
part of the Conversion Shares, including any securities issued or issuable with
respect to the Conversion Shares by way of replacement, share dividend, share
split or in connection with a combination of shares, recapitalization, merger,
consolidation or other reorganization (the "Registrable Securities"), as
provided herein (a "Demand Registration").
a. Except as provided below, during the Demand Period any holder or
combination of holders (the "Demanding Shareholders") owning more than
50% or more of the Registrable Securities may deliver to the Borrower
a written request (a "Demand Registration Request") that the Borrower
register any or all such Demanding Shareholders' Registrable Shares.
b. A Demand Registration Request from Demanding Shareholders shall (i)
set forth the number of Registrable Securities intended to be sold
pursuant to the Demand Registration Request; (ii) disclose whether all
or any portion of a distribution pursuant to such registration will be
sought by means of an underwriting; and (iii) identify any managing
underwriter or managing underwriters proposed for the underwritten
portion, if any, of such registration.
c. Upon the receipt by the Borrower of a Demand Registration Request, the
Borrower shall, within ten (10) days following receipt of such Demand
Registration Request, notify the Demanding Shareholders whether all,
part, or none of the distribution is expected to be made by means of
an underwriting, and, if more than one means of distribution is
contemplated, may require holders to notify the Borrower of the means
of distribution of their Registrable Securities to be included in the
registration. The right of the holder to include all or any portion of
its Registrable Securities in an underwriting shall be conditioned
upon the Borrower's having received a timely written request for such
inclusion by way of a Demand Registration Request (which right shall
be further conditioned to the extent provided in this Agreement).
6.2. Right to Piggyback. If the Borrower proposes to undertake an offering
of shares of Common Stock for its account or for the account of other
stockholders and the registration form to be used for such offering may be used
for the registration of Registrable Securities (a "Piggyback Registration"),
each such time the Borrower will give prompt written notice to all holders of
Registrable Securities of its intention to effect such a registration (each, a
"Piggyback Notice") and the Borrower will use its best efforts to cause to be
included in such registration all Registrable Securities with respect to which
the Borrower has received written requests for inclusion therein within twenty
(20) days after the date of sending the Piggyback Notice.
a. Priority on Primary Registrations. If a Piggyback Registration is an
underwritten primary registration on behalf of the Borrower, and the
managing underwriters advise the Borrower in writing that in their
opinion the number of securities requested to be included in such
registration exceeds the number that can be sold in an orderly manner
within a price range acceptable to the Borrower, the Borrower will
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include in such registration (a) first, the securities the Borrower
proposes to sell, and (b) second, the Registrable Securities requested
to be included in such registration and any other securities requested
to be included in such registration that are held by persons other
than the Holders of Registrable Securities pursuant to registration
rights, pro rata among the holders of Registrable Securities and the
holders of such other securities requesting such registration on the
basis of the number of shares of such securities owned by each such
holder.
b. Priority on Secondary Registrations. If a Piggyback Registration is an
underwritten secondary registration on behalf of holders of the
Borrower's securities other than the holders of Registrable Securities
(the "Other Holders"), and the managing underwriters advise the
Borrower in writing that in their opinion the number of securities
requested to be included in such registration exceeds the number that
can be sold in an orderly manner in such offering within a price range
acceptable to the Other Holders requesting such registration, the
Borrower will include in such registration (a) first, the securities
requested to be included therein by the Other Holders requesting such
registration, and (b) second, the Registrable Securities requested to
be included in such registration hereunder, pro rata among the holders
of Registrable Securities requesting such registration on the basis of
the number of shares entitled to registration rights owned by each
such holder.
c. The rights granted by this section will not apply to the Borrower's
current registration statement.
6.3. Registration. The Borrower will use its reasonable best efforts to
effect the registration of such Registrable Securities in accordance with the
intended method of disposition thereof, and pursuant thereto the Borrower will
as expeditiously as possible:
a. Registration Statement. Prepare and file with the Securities and
Exchange Commission (the "SEC") a registration statement with respect
to such Registrable Securities and use its reasonable best efforts to
cause such registration statement to become effective.
b. Amendments and Supplements. Promptly prepare and file with the SEC
such amendments and supplements to such registration statement and the
prospectus used in connection therewith as may be necessary to keep
such registration statement effective for the period required by the
intended method of disposition and the terms of this Agreement and
comply with the provisions of the Securities Act with respect to the
disposition of all securities covered by such registration statement
during such period in accordance with the intended methods of
disposition by the sellers thereof set forth in such registration
statement.
c. Provisions of Copies. Promptly furnish to each seller of Registrable
Securities the number of copies of such registration statement, each
amendment and supplement thereto, the prospectus included in such
registration statement (including each preliminary prospectus) and
such other documents as such seller may reasonably request in order to
facilitate the disposition of the Registrable Securities owned by such
seller.
d. Blue Sky Laws. Use its reasonable best efforts to register or qualify
such Registrable Securities under the securities or blue sky laws of
such jurisdictions as any seller reasonably requests and do any and
all other acts and things which may be reasonably necessary or
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advisable to enable such seller to consummate the disposition in such
jurisdictions of the Registrable Securities owned by such seller,
provided, that the Borrower will not be required to (a) qualify
generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this subsection; (b) subject
itself to taxation in any such jurisdiction; or (c) consent to general
service of process in any such jurisdiction.
e. Prospectus Updating. Promptly notify each seller of such Registrable
Shares when a prospectus relating thereto is required to be delivered
under the Securities Act, of the happening of any of the following
events (i) the occurrence of one or more event which, individually or
together, represents a fundamental change in the information contained
in the prospectus included with such registration statement; (ii) any
material addition or change on the plan of distribution; or (iii) any
event which would cause the information in the prospectus included in
such registration statement to contain an untrue statement of a
material fact or omit any material fact necessary to make the
statements therein not misleading. In such event, at the request of
any such seller, the Borrower will promptly prepare a supplement or
amendment to such prospectus.
f. Due Diligence. Make available for inspection by any underwriter
participating in any disposition pursuant to such registration
statement and any attorney, accountant or other agent retained by any
such underwriter, all financial and other records, pertinent corporate
documents, and properties of the Borrower, and cause the Borrower's
officers, directors, employees, and independent accountants to supply
all information reasonably requested by any such underwriter,
attorney, accountant or agent in connection with such registration
statement.
g. Deemed Underwriters or Controlling Persons. Permit any holder of
Registrable Securities which holder, in such holder's reasonable
judgment, might be deemed to be an underwriter or a controlling person
of the Borrower, to participate in the preparation of such
registration or comparable statement and to require the insertion
therein of material in form and substance satisfactory to such holder
and to the Borrower and furnished to the Borrower in writing, which in
the reasonable judgment of such holder and its counsel should be
included.
h. Stop Orders. Promptly notify holders of the Registrable Securities of
the threat of issuance by the SEC of any stop order suspending the
effectiveness of the registration statement or the initiation of any
proceeding for that purpose, and make every reasonable effort to
prevent the entry of any order suspending the effectiveness of the
registration statement. In the event of the issuance of any stop order
suspending the effectiveness of a registration statement, or of any
order suspending or preventing the use of any related prospectus or
suspending the qualification of any Registrable Securities included in
such registration statement for sale in any jurisdiction, the Borrower
will use its reasonable best efforts promptly to obtain the withdrawal
of such order.
6.4. Further Information. The Borrower may require each holder of
Registrable Securities to furnish to the Borrower in writing such information
regarding the proposed distribution by such holder as the Borrower may from time
to time reasonably request.
6.5. Notice to Suspend Offers and Sales. Each Holder severally agrees that,
upon receipt of any notice from the Borrower of the happening of any event of
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the kind described in Sections 6.3(e) and 6.3(h) hereof, such Holder will
forthwith discontinue disposition of shares of Common Stock pursuant to a
registration hereunder until receipt of the copies of an appropriate supplement
or amendment to the prospectus under Section 6.3(e) or until the withdrawal of
such order under Section 6.3(h).
6.6. Reference to Holders. If any such registration or comparable statement
refers to any holder by name or otherwise as the holder of any securities of the
Borrower and if, in the holder's reasonable judgment, such holder is or might be
deemed to be a controlling person of the Borrower, such holder shall have the
right to require (a) the insertion therein of language in form and substance
satisfactory to such holder and the Borrower and presented to the Borrower in
writing, to the effect that the holding by such holder of such securities is not
to be construed as a recommendation by such holder of the investment quality of
the Borrower's securities covered thereby and that such holdings do not imply
that such holder will assist in meeting any future financial requirements of the
Borrower.
6.7. Registration Expenses.
6.7.1 Expense Borne by Borrower. Except as specifically otherwise provided
in Section 6.7.2, the Borrower will be responsible for payment of all expenses
incident to any registration hereunder, including, without limitation, all
registration and filing fees, fees and expenses of compliance with securities or
blue sky laws, printing expenses, messenger and delivery expenses, road show
expenses, advertising expenses and fees and disbursements of counsel for the
Borrower and all independent certified public accountants and other Persons
retained by the Borrower in connection with such registration.
6.7.2 Expense Borne by Selling Security Holders. The holder will be
responsible for payment of his own legal fees (if he retains legal counsel
separate from that of the Borrower), underwriting fees and brokerage discounts,
commissions and other sales expenses incident to any registration hereunder.
7. Non-Waiver. No course of dealing between the parties hereto, or any
failure or delay on the part of a party in exercising any rights or remedies
hereunder, shall operate as a waiver of any rights or remedies of that party
under this or any other applicable instrument. No single or partial exercise of
any rights or remedies hereunder shall operate as a waiver or preclude the
exercise of any other rights or remedies hereunder.
8. Representations and Warranties.
Each of the parties hereto represents and warrants to the others as
follows:
8.1 Powers and Authority. It has all necessary power to carry on its
present business and has full right, power and authority to enter into this
Agreement, to make the loans or borrowings, as applicable, herein provided for,
and otherwise perform and to consummate the transactions contemplated hereby.
8.2 No Conflicts. This Agreement does not, and the performance or
observance by the party of any of the matters and things herein provided for
will not, constitute an Event of Default, as defined in the Note, or event which
with the lapse of time, the giving of notice or both, would constitute an event
of default under any other agreement to which it is a party or by which it is
bound.
8.3 Corporate Organization. It is a duly organized and validly existing
under its jurisdiction of organization.
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8.4 Corporate Authorization. The board of directors or other governing body
of the party has authorized the execution and performance of this Agreement.
9. Right of First Refusal. Provided that the Lender and any affiliates have
loaned in the aggregate $2,300,000 to the Borrower, and in the event the
Borrower receives an offer from (or negotiates with) a third party to provide
the Borrower with additional financing before the Maturity Date (as defined in
the Note), the Borrower shall notify the Lender of the terms of financing within
ten (10) days of the offer or negotiation. The Borrower hereby unconditionally
and irrevocably grants the Lender a right of first refusal, to offer financing
on the same terms and conditions as those agreed to or offered by the third
party. The Lender will have ten (10) days after receiving notice from the
Borrower to decide whether to provide financing based on the same terms as those
agreed to or offered by the third party. If the Lender fails to respond to the
Borrower within ten (10) days, as set forth above, the Borrower may proceed with
the third party financing. The Borrower shall not enter into a definitive
agreement for additional financing with another party without providing notice
to the Lender and an opportunity for Lender to respond as provided in this
Section.
10. Fees and Expenses. Except as expressly set forth in this Agreement to
the contrary, each party shall pay the fees and expenses of its advisers,
counsel, accountants and other experts, if any, and all other expenses incurred
by such party incident to the negotiation, preparation, execution, delivery and
performance of this Agreement. The Borrower shall pay up to $10,000.00 of the
Lender's reasonable attorney's fees and out of pocket costs incurred in
connection with the negotiation of this Agreement, the issuance of the Note, and
other costs incurred by Lender and reasonably associated with this transaction.
11. Successors and Assigns; Assignment. Except as otherwise expressly
provided herein, the provisions hereof inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto. Nothing in this Agreement, express or implied, is intended to
confer upon any party, other than the parties hereto and their successors and
assigns, any rights, remedies, obligations or liabilities under or by reason of
this Agreement, except as expressly provided herein. The Borrower may not assign
this Agreement or any of the rights or obligations referenced herein without the
prior written consent of the Lender. The Lender may assign this Agreement, in
whole or in part, without the prior consent of the Borrower, and any assignee of
this Agreement shall inure to all of the rights of the Lender hereunder.
12. Waiver of Notice. The Borrower hereby waives notice, presentment,
demand, protest, and notice of dishonor.
13. Notices. Any notice, demand, request, waiver or other communication
required or permitted to be given pursuant to this Agreement must be in writing
(including electronic format) and will be deemed by the parties to have been
received (i) upon delivery in person (including by reputable express courier
service) at the address set forth below; (ii) upon delivery by electronic mail
(as verified by a printout showing satisfactory transmission) at the electronic
mail address set forth below (if sent on a business day during normal business
hours where such notice is to be received and if not, on the first business day
following such delivery where such notice is to be received); or (iii) upon
receipt if mailed with the United States Postal Service if mailed from and to a
location within the continental United States by registered or certified mail,
return receipt requested, addressed to the address set forth below. Any party
hereto may from time to time change its physical or electronic address or
facsimile number for notices by giving notice of such changed address or number
to the other party in accordance with this section.
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If to the Lender at:
Green Acre Partners A, LLC
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Email Address:
▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
With a copy (which will not
constitute notice) to: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
The Law Office of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ &
Associates, P.C.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Email Address: ▇▇▇@▇▇▇▇▇▇▇▇.▇▇
If to the Borrower at:
Strainwise, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Email Address: ▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
14. No Stockholder Rights. Nothing contained in this Agreement shall be
construed as conferring upon Lender or any other person the right to vote or to
consent or to receive notice as a stockholder in respect of meetings of
stockholders for the election of directors of the Borrower or any other matters
or any rights whatsoever as a stockholder of the Borrower.
15. Heading; References. All headings used herein are used for convenience
only and shall not be used to construe or interpret this Agreement. Except as
otherwise indicated, all references herein to Sections refer to Sections hereof.
16. Binding Agreement; Survival. This Agreement shall bind and inure to the
benefit of both parties, and except as otherwise expressly provided to the
contrary herein, each of their respective heirs, successors and assigns.
17. Delays or Omissions. No delay or omission to exercise any right, power,
or remedy accruing to the Lender, upon any breach or default of the Borrower
under this Agreement shall impair any such right, power, or remedy of the Lender
nor shall it be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of or in any similar breach or default thereafter
occurring; nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default therefore or thereafter occurring. All
remedies, either under this Agreement or by law or otherwise afforded to the
Lender, shall be cumulative and not alternative.
18. Construction. The parties acknowledge that the parties and their
counsel have reviewed and revised this Agreement and that the language used in
this Agreement has been chosen by the parties to express their mutual intent.
Accordingly, no rules of strict construction will be applied against any party
with respect to this Agreement.
107
19. Cumulative Rights. No delay on the part of the Lender in the exercise
of any power or right under this Agreement or under any other instrument
executed pursuant to this Agreement shall operate as a waiver of any such power
or right, nor shall a single or partial exercise of any power or right preclude
other or further exercise of such power or right or the exercise of any other
power or right.
20. Payments Free of Taxes, Etc. All payments made by the Borrower under
this Agreement shall be made by the Borrower free and clear of and without
deduction for any and all present and future taxes, levies, charges, deductions,
and withholdings. In addition, the Borrower shall pay upon demand any stamp or
other taxes, levies or charges of any jurisdiction with respect to the
execution, delivery, registration, performance, and enforcement of this
Agreement. Upon request by the Lender, the Borrower shall furnish evidence
satisfactory to the Lender that all requisite authorizations and approvals by,
and notices to and filings with, governmental authorities and regulatory bodies
have been obtained and made and that all requisite taxes, levies, and charges
have been paid.
21. Severability. If one or more provisions of this Agreement are held to
be unenforceable under applicable law, such provision(s) shall be excluded from
this Agreement and the balance of this Agreement shall be interpreted as if such
provision(s) were so excluded and shall be enforceable in accordance with its
terms.
22. Other Interpretive Provisions. References in this Agreement to any
document, instrument or agreement (a) includes all exhibits, schedules, and
other attachments thereto, (b) includes all documents, instruments or agreements
issued or executed in replacement thereof, and (c) means such document,
instrument or agreement, or replacement or predecessor thereto, as amended,
modified and supplemented from time to time and in effect at any given time. The
words "hereof," "herein" and "hereunder" and words of similar import when used
in this Agreement refer to this Agreement as a whole and not to any particular
provision of this Agreement. The words "include" and "including" and words of
similar import when used in this Agreement shall not be construed to be limiting
or exclusive.
23. No Oral Modification or Waivers. The terms herein may not be modified
or waived orally, but only by an instrument in writing signed by the party
against which enforcement of the modification or waiver is sought.
24. Attorneys' Fees. In the event of any suit or action to enforce or
interpret any provision of this Agreement or otherwise arising out of this
Agreement, the prevailing party is entitled to recover, in addition to other
direct incremental costs, reasonable attorney fees in connection with the suit,
action, or arbitration, and in any appeals.
25. Governing Law; Jurisdiction; Venue. This Agreement, and all matters
arising directly and indirectly herefrom (the "Covered Matters"), shall be
governed in all respects by the laws of the State of Colorado as such laws are
applied to agreements between parties in Colorado. The Lender and the Borrower
irrevocably submit to the personal jurisdiction of the courts of the State of
Colorado and the United States District Court for the District of Colorado for
the purpose of any suit, action, proceeding or judgment relating to or arising
out of the Covered Matters. Service of process on the Lender or the Borrower in
connection with any such suit, action or proceeding may be served on the Lender
or the Borrower anywhere in the world by the same methods as are specified for
the giving of notices under this Agreement. The Lender and the Borrower
irrevocably consent to the jurisdiction of any such court in any such suit,
action or proceeding and to the laying of venue in such court. The Lender and
the Borrower irrevocably waive any objection to the laying of venue of any such
suit, action or proceeding brought in such courts and irrevocably waives any
claim that any such suit, action or proceeding brought in any such court has
been brought in an inconvenient forum.
108
26. Entire Agreement; Integration Clause. This Agreement sets forth the
entire agreement and understandings of the parties hereto with respect to this
transaction, and this Agreement supersedes and nullifies all other agreements
made between the parties hereto.
27. Counterparts. This Agreement may be executed in as many counterpart
copies as may be required. All counterparts shall collectively constitute a
single agreement.
[Signature page follows]
109
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
BORROWER
Strainwise, Inc., a Utah corporation
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Its: President
LENDER
Green Acres Partners B, LLC
By Green Acres Partners B, LLC, Manager
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Its: Manager
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THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. IT MAY
NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A
REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITY UNDER SUCH ACT OR
AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 OF SUCH ACT.
STRAINWISE, INC.
AMENDED AND RESTATED
25% SENIOR CONVERTIBLE PROMISSORY NOTE
Up to $2,300,000 February, 5, 2015
STRAINWISE, INC., a Utah corporation (the "Company"), for value received,
hereby promises to pay to GREEN ACRES PARTNERS A, LLC, a Nevada limited
liability company (the "Holder"), the aggregate principal amount of all the
"Loan Advance(s)" owing to the Holder as set forth in Schedule A hereto, on the
terms and conditions set forth in this Amended and Restated 25% Senior
Convertible Promissory Note (this "Note"). This Note amends and restates, but
does not extinguish, impair, novate or discharge the obligations evidenced by
that certain Promissory Note, dated January 30, 2015, executed by the Company in
favor of the Holder. Each Loan Advance owing to the Holder by the Company, and
all payments made on account of principal thereof, shall be recorded by the
Holder upon the transfer thereof, endorsed on the grid marked as Schedule A
hereto, which is part of this Note; provided, however, that the failure of the
Holder to make any such recordation or endorsement shall not affect the
obligations of the Company under this Note. Payment for all amounts due
hereunder shall be made by mail or wire to the registered address of the Holder.
The performance of the obligations of the Company hereunder are secured by
guaranties of the principals of the Company and a subsidiary of the Company, of
even date herewith, and all other present and future security agreements between
the Company and the Holder.
The following is a statement of the rights of the Holder of this Note and
the conditions to which this Note is subject, and to which the Holder hereof, by
the acceptance of this Note, agrees:
1. Maturity. The principal hereof and any unpaid accrued interest hereon,
as set forth below, regardless of when paid or recorded on Schedule A, shall be
due and payable on the earlier to occur of: (i) January 31, 2017 (the "Maturity
Date"); or (ii) when declared due and payable by the Holder upon the occurrence
of an Event of Default (as defined below).
2. Interest. This Note shall accrue interest on the principal for a period
from the date of this Note at a rate of twenty-five percent (25%) per annum (the
"Interest Rate"), commencing on the date set forth in Schedule A for that
particular Loan Advance. The Company will pay interest on the Note on a monthly
basis until paid in full. Interest shall be calculated on the basis of a 365-day
year for the actual number of days elapsed. Interest payments are due and
payable in advance on or before the 15th day of each month during the term of
this Note, commencing February 15, 2015. If there occurs an acceleration or
prepayment of the Note prior to the Maturity Date in accordance with the terms
hereof, all interest due and payable at such time on the principal amount due
111
shall be paid in full. All payments hereunder are to be applied first to
reasonable costs and fees referred to herein, second to the payment of accrued
interest, and the remaining balance to the payment of principal.
3. Prepayment Penalty. This Note is subject to prepayment, in whole or in
part, at any time upon not less than thirty (30) days' written notice to the
Holder. If any prepayment is made by or on behalf of the Company prior to the
Maturity Date, there shall be a prepayment penalty equal to ten percent (10%) of
the principal so prepaid.
4. Subordination. The Company covenants and agrees, and the Holder, by such
Holder's acceptance hereof, likewise covenants and agrees, that, to the extent
and in the manner hereinafter set forth in this Section, the indebtedness
represented by this Note and the payment of the principal of and interest on
this Note are hereby expressly made senior to any other indebtedness of the
Company, other than the debt owed Bishane Race LLC in the principal amount of
$457,160. The Company hereby covenants that to the extent that the Company has
other debts outstanding (other than those set forth above), the Company will use
its best efforts to obtain the agreement of such creditors to subordinate their
debts to that of the Holder.
5. Events of Default. If any of the events specified in this Section occur
(herein individually referred to as an "Event of Default"), the Holder may, so
long as such condition exists, declare the entire principal and unpaid accrued
interest hereon immediately due and payable, by notice in writing to the
Company:
a. Default in the payment of the principal or unpaid accrued interest
of this Note when due and payable;
b. The institution by the Company of proceedings to be adjudicated as
bankrupt or insolvent, or the consent by it to institution of bankruptcy or
insolvency proceedings against it or the filing by it of a petition or
answer or consent seeking reorganization or release under the Federal
Bankruptcy Act, or any other applicable Federal or state law, or the
consent by it to the filing of any such petition or the appointment of a
receiver, liquidator, assignee, trustee or other similar official of the
Company, or of any substantial part of its property, or the making by it of
an assignment for the benefit of creditors, or the taking of corporate
action by the Company in furtherance of any such action;
c. If, within sixty (60) calendar days after the commencement of an
action against the Company, without the consent or acquiescence of the
Company (and service of process in connection therewith on the Company)
seeking any bankruptcy, insolvency, reorganization, liquidation,
dissolution or similar relief under any present or future statute, law or
regulation, such action shall not have been resolved in favor of the
Company or all orders or proceedings thereunder affecting the operations or
the business of the Company stayed, or if the stay of any such order or
proceeding shall thereafter be set aside, or if, within sixty (60) calendar
days after the appointment without the consent or acquiescence of the
Company of any trustee, receiver or liquidator of the Company or of all or
any substantial part of the properties of the Company, such appointment
shall not have been vacated;
d. The Company is a party to any Change of Control Transaction or
agrees to sell or dispose of all or in excess of fifty percent (50%) of its
assets in one transaction or a series of related transactions (whether or
not such sale would constitute a Change of Control Transaction). For the
purpose of this Note, the term "Change of Control Transaction" means the
occurrence after the date hereof of any of the following: (i) an
acquisition after the date hereof by an individual or legal entity or
"group" (as described in Rule 13d-5(b)(1) promulgated under the Exchange
Act) of effective control (whether through legal or beneficial ownership of
the Company, by contract or otherwise) of in excess of fifty percent (50%)
of the voting securities of the Company; (ii) the Company merges into or
consolidates with any other person or entity, or any person or entity
112
merges into or consolidates with the Company and, after giving effect to
such transaction, the stockholders of the Company immediately prior to such
transaction own less than sixty percent (60%) of the aggregate voting power
of the Company or the successor entity of such transaction; (iii) the
Company or its subsidiary sells or transfers all or substantially all of
its assets to another person or entity and the stockholders of the Company
or the subsidiary immediately prior to such transaction own less than sixty
percent (60%) of the aggregate voting power of the successor entity
immediately after the transaction; (iv) a replacement at one time or within
a two (2) year period of more than one-half of the members of the Board of
Directors of the Company or any subsidiary (the "Board of Directors") which
is not approved by a majority of those individuals who are members of the
Board of Directors on the original issue date (or by those individuals who
are serving as members of the Board of Directors on any date whose
nomination to the Board of Directors was approved by a majority of the
members of the Board of Directors who are members on the date hereof); or
(v) the execution by the Company or a subsidiary of an agreement to which
the Company is a party or by which it is bound, providing for any of the
events set forth in clauses (i) through (iv) above; or
e. Any material breach of this Agreement or the Loan Agreement between
the parties of even date herewith, as hereafter amended, that remains
uncured after notice of breach and failure to timely cure such breach.
6. The Holder's Rights Upon Event of Default. Upon the occurrence and
continuance of any Event of Default, the Holder in its sole and absolute
discretion will have the right to declare all unpaid interest and principal
immediately due and payable and exercise all other legal rights in connection
therewith.
7. Conversion. Subject to and in compliance with the provisions contained
herein, the Holder, or its assignee, is entitled, at its option, at any time
prior to maturity, or in case this Note or some portion hereof shall have been
called for prepayment prior to such date, then, in respect of this Note or such
portion hereof, until and including, but not after, the close of business within
thirty (30) days of the date of notice of prepayment, to convert the principal
amount of the debt owed under this Note into common shares of the Company at the
rate of $1.00 per share (the "Shares"). If the Holder exercises this option, it
shall do so by surrendering this Note, duly endorsed or assigned to the Company,
accompanied by written notice to the Company, in the form set forth below, that
the Holder hereof elects to convert this Note or, if less than the entire
principal amount hereof is to be converted, the portion hereof to be converted.
Such conversion shall be effected at the rate of one share of Company common
stock per $1.00 of principal amount plus accrued and unpaid interest of this
Note, all subject to such adjustment in such conversion price, if any, as may be
required by the provisions of this Note. No fractions of Shares will be issued
on conversion, but instead of any fractional interest, the Company will pay cash
adjustments as provided herein.
8. Limitations on Right of Conversion. Following receipt of the written
notice of intention to convert the Note, the Company shall take such steps as it
deems appropriate to permit conversion of the Note as specified in the notice
without registration or qualification under applicable federal and state
securities laws; provided, that in no event shall the Company be required to
consent to the general service of process or to qualify as a foreign corporation
in any jurisdiction where the Holder resides if such jurisdiction is different
than such Holder's residence when the Note was originally offered and sold. In
order to comply with exemptions from the registration requirements of the
Securities Act of 1933 (the "Act") and certain state securities statutes, the
Company may require the Holder of this Note to make certain representations and
113
execute and deliver to the Company certain documents as a condition to exercise
of conversion rights hereunder, all in form and substance satisfactory to the
Company as determined in its sole discretion. In the event the Company
reasonably determines that the Note cannot be converted in compliance with
applicable federal and state securities laws in the absence of registration or
qualification under such statutes, the Company shall be under no obligation to
permit conversion of the Note and issue any shares of common stock pursuant
hereto. The Company shall also utilize its best efforts to qualify such Shares
for sale under the applicable state laws in those jurisdictions in which the
Holder of the Note resides at the time of conversion. If, notwithstanding such
efforts to qualify such Shares for sale in such state, the Company is unable to
so qualify such Shares for sale in such state, the Shares delivered shall be
subject to applicable restrictions on their transfer under the laws of such
state or, of no exemption from registration is available, this Note shall not be
convertible.
9. Adjustment in Conversion. The conversion price and number of Shares
issuable upon conversion of this Note may be subject to adjustment from time to
time as follows:
a. If the Company takes a record of the Holders of its Shares for the
purpose of entitling them to receive a dividend in Shares, the conversion
price in effect immediately prior to such record date shall be
proportionately decreased, such adjustment to become effective immediately
after the opening of business on the day following such record date;
b. If the Company subdivides the outstanding Shares into a greater
number of Shares or combine the outstanding Shares into a smaller number of
Shares, or issues by reclassification any of its Shares, the conversion
price in effect immediately prior thereto shall be adjusted so that the
Holder of the Note thereafter surrendered for conversion shall be entitled
to receive after the occurrence of any of the events described the number
of Shares to which the Holder would have been entitled had such Note been
converted immediately prior to the occurrence of such event, such
adjustment to become effective immediately after the opening of business on
the day following the date upon which such subdivision or combination or
reclassification, as the case may be, becomes effective;
c. No fraction of a Share shall be issued upon conversion, but in lieu
thereof the Company, notwithstanding any other provision hereof, may pay
therefor in cash at the fair value of the fractional Share at the time of
conversion;
d. Neither the purchase or other acquisition by the Company of any
Shares, nor the sale of other disposition by the Company of any Shares,
shall affect any adjustment of the conversion price or be taken into
account in computing any subsequent adjustment of the conversion price; and
e. If at any time:
i. the Company proposes to pay any dividend payable in Shares
upon its Shares or make any distribution, including cash or property
dividend, out of earnings or earned surplus, to the holders of Shares;
ii. the Company proposes to enter into any plan of capital
reorganization or reclassification of the Shares of the Company; or
iii. the Company proposes to merge, consolidate, or encumber or
sell all or substantially all of its assets other than in the ordinary
course of business,
then, in any one or more of said cases, the Company shall cause a notice to be
mailed to the registered Holder of this Note at the address of such Holder set
forth in the registration records of the Company. Such notice shall be solely
for the convenience of such registered holder and shall not be a condition
precedent to, nor shall any defect therein or failure in connection therewith
114
affect the validity of, the action proposed to be taken by the Company. Such
notice shall be mailed, at least ten (10) days prior to the date on which the
books of the Company shall close, or a record date shall be taken for such
Shares dividend, Share split or reclassification, consolidation, merger, or sale
of properties and assets, as the case may be. Such notice shall specify such
record date for the closing of the transfer books. 10. Restrictions. The Holder
of this Note, by acceptance hereof, both with respect to the Note and the Shares
to be issuable upon conversion of the Note (unless issued pursuant to an
effective registration statement under the Securities Act of 1933, as amended
(the "Act")), represents and warrants as follows:
a. The Note and the Shares are being acquired for the Holder's own
account to be held for investment purposes only and not with a view to, or
for, resale in connection with any distribution of such Note or Shares or
any interest therein without registration or other compliance under the
Act, and the Holder hereof has no direct or indirect participation in any
such undertaking or in underwriting such an undertaking.
b. The Holder hereof has been advised and understands that the Note
and the Shares have not been registered under the Act and the Note and/or
the Shares must be held and may not be sold, transferred, or otherwise
disposed of for value unless they are subsequently registered under the Act
or an exemption from such registration is available; the Company is under
no obligation to register the Note and/or the Shares under the Act; in the
absence of such registration, sale of the Note or Shares may be
impracticable; the Company or the Company's registrar and transfer agent,
if any, will maintain stock transfer orders against registration of
transfer of the Note and the Shares; and the certificates to be issued for
any Shares will bear on their face a legend in substantially the following
form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
OR UNDER THE SECURITIES LAWS OF ANY STATE. THESE SECURITIES HAVE BEEN
ACQUIRED FOR INVESTMENT AND MAY NOT BE TRANSFERRED OR SOLD IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION OR OTHER COMPLIANCE UNDER THE ACT
OR THE LAWS OF THE APPLICABLE STATE OR A "NO ACTION" OR INTERPRETIVE
LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION OR AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO THE ISSUER, AND ITS COUNSEL, TO THE
EFFECT THAT THE SALE OR TRANSFER IS EXEMPT FROM REGISTRATION UNDER THE
ACT AND SUCH STATE STATUTES.
c. The Company may refuse to transfer the Note and/or the Shares
unless the Holder thereof provides an opinion of legal counsel reasonably
satisfactory to the Company or a "no action" or interpretive response from
the Securities and Exchange Commission to the effect that the transfer is
proper; further, unless such letter or opinion states that the Note and/or
Shares are free from any restrictions under the Act, the Company may refuse
to transfer the Note and/or the Shares to any transferee who does not
furnish in writing to the Company the same representations and agrees to
the same conditions with respect to such Note and Shares as set forth
herein. The Company may also refuse to transfer the Note or Shares if any
circumstances are present reasonably indicating that the transferee's
representations are not accurate.
11. Treatment of Note. To the extent permitted by generally accepted
accounting principles, the Company will treat, account, and report the Note as
debt and not equity for accounting purposes and with respect to any returns
filed with Federal, state or local tax authorities.
115
12. Successors and Assigns; Assignment. Except as otherwise expressly
provided herein, the provisions hereof inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors, and administrators of the
parties hereto. Nothing in this Note, express or implied, is intended to confer
upon any party, other than the parties hereto and their successors and assigns,
any rights, remedies, obligations or liabilities under or by reason of this
Note, except as expressly provided herein. The Company may not assign this Note
or any of the rights or obligations referenced herein without the prior written
consent of the Holder. The Holder may assign this Note, in whole or in part,
without the prior consent of the Company, and any assignee of this Note shall
inure to all of the rights of the Holder hereunder.
13. Waiver of Notice. The Company hereby waives notice, presentment,
demand, protest, and notice of dishonor.
14. Notices. Any notice, demand, request, waiver or other communication
required or permitted to be given pursuant to this Note must be in writing
(including electronic format) and will be deemed by the parties to have been
received (i) upon delivery in person (including by reputable express courier
service) at the address set forth below; (ii) upon delivery by electronic mail
(as verified by a printout showing satisfactory transmission) at the electronic
mail address set forth below (if sent on a business day during normal business
hours where such notice is to be received and if not, on the first business day
following such delivery where such notice is to be received); or (iii) upon
receipt if mailed with the United States Postal Service if mailed from and to a
location within the continental United States by registered or certified mail,
return receipt requested, addressed to the address set forth below. Any party
hereto may from time to time change its physical or electronic address or
facsimile number for notices by giving notice of such changed address or number
to the other party in accordance with this section.
If to the Holder at:
Green Acre Partners A, LLC
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Email Address:
▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
With a copy (which will not
constitute notice) to: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
The Law Office of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ &
Associates, P.C.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Email Address: ▇▇▇@▇▇▇▇▇▇▇▇.▇▇
If to the Company at:
Strainwise, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Email Address: ▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
116
15. No Stockholder Rights. Nothing contained in this Note shall be
construed as conferring upon Holder or any other person the right to vote or to
consent or to receive notice as a stockholder in respect of meetings of
stockholders for the election of directors of the Company or any other matters
or any rights whatsoever as a stockholder of the Company.
16. Heading; References. All headings used herein are used for convenience
only and shall not be used to construe or interpret this Note. Except as
otherwise indicated, all references herein to Sections refer to Sections hereof.
17. Binding Agreement; Survival. This Note shall bind and inure to the
benefit of both parties, and except as otherwise expressly provided to the
contrary herein, each of their respective heirs, successors and assigns.
18. Delays or Omissions. No delay or omission to exercise any right, power,
or remedy accruing to the Holder, upon any breach or default of the Company
under this Note shall impair any such right, power, or remedy of the Holder nor
shall it be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of or in any similar breach or default thereafter
occurring; nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default therefore or thereafter occurring. All
remedies, either under this Note or by law or otherwise afforded to the Holder,
shall be cumulative and not alternative.
19. Construction. The parties acknowledge that the parties and their
counsel have reviewed and revised this Note and that the language used in this
Note has been chosen by the parties to express their mutual intent. Accordingly,
no rules of strict construction will be applied against any party with respect
to this Note.
20. Cumulative Rights. No delay on the part of the Holder in the exercise
of any power or right under this Note or under any other instrument executed
pursuant to this Note shall operate as a waiver of any such power or right, nor
shall a single or partial exercise of any power or right preclude other or
further exercise of such power or right or the exercise of any other power or
right.
21. Payments Free of Taxes, Etc. All payments made by the Company under
this Note shall be made by the Company free and clear of and without deduction
for any and all present and future taxes, levies, charges, deductions, and
withholdings. In addition, the Company shall pay upon demand any stamp or other
taxes, levies or charges of any jurisdiction with respect to the execution,
delivery, registration, performance, and enforcement of this Note. Upon request
by the Holder, the Company shall furnish evidence satisfactory to the Holder
Party that all requisite authorizations and approvals by, and notices to and
filings with, governmental authorities and regulatory bodies have been obtained
and made and that all requisite taxes, levies, and charges have been paid.
22. Severability. If one or more provisions of this Note are held to be
unenforceable under applicable law, such provision(s) shall be excluded from
this Note and the balance of this Note shall be interpreted as if such
provision(s) were so excluded and shall be enforceable in accordance with its
terms.
23. Other Interpretive Provisions. References in the Note to any document,
instrument or agreement (a) includes all exhibits, schedules, and other
attachments thereto, (b) includes all documents, instruments or agreements
issued or executed in replacement thereof, and (c) means such document,
instrument or agreement, or replacement or predecessor thereto, as amended,
modified and supplemented from time to time and in effect at any given time. The
words "hereof," "herein" and "hereunder" and words of similar import when used
in this Note refer to this Note as a whole and not to any particular provision
117
of this Note. The words "include" and "including" and words of similar import
when used in this Note shall not be construed to be limiting or exclusive.
24. No Oral Modification or Waivers. The terms herein may not be modified
or waived orally, but only by an instrument in writing signed by the party
against which enforcement of the modification or waiver is sought.
25. Attorneys' Fees. In the event of any suit or action to enforce or
interpret any provision of this Note or otherwise arising out of this Note, the
prevailing party is entitled to recover, in addition to other direct incremental
costs, reasonable attorney fees in connection with the suit, action, or
arbitration, and in any appeals.
26. Governing Law; Jurisdiction; Venue. This Note, and all matters arising
directly and indirectly herefrom (the "Covered Matters"), shall be governed in
all respects by the laws of the State of Colorado as such laws are applied to
agreements between parties in Colorado. The Holder and the Company irrevocably
submit to the personal jurisdiction of the courts of the State of Colorado and
the United States District Court for the District of Colorado for the purpose of
any suit, action, proceeding or judgment relating to or arising out of the
Covered Matters. Service of process on the Holder or the Company in connection
with any such suit, action or proceeding may be served on the Holder or the
Company anywhere in the world by the same methods as are specified for the
giving of notices under this Note. The Holder and the Company irrevocably
consent to the jurisdiction of any such court in any such suit, action or
proceeding and to the laying of venue in such court. The Holder and the Company
irrevocably waive any objection to the laying of venue of any such suit, action
or proceeding brought in such courts and irrevocably waives any claim that any
such suit, action or proceeding brought in any such court has been brought in an
inconvenient forum.
27. Entire Agreement; Integration Clause. This Note sets forth the entire
agreement and understandings of the parties hereto with respect to this
transaction, and this Note supersedes and nullifies all other agreements made
between the parties hereto.
28. Counterparts. This Note may be executed in as many counterpart copies
as may be required. All counterparts shall collectively constitute a single
agreement.
[Signature page follows]
118
IN WITNESS WHEREOF, the Company has caused this Note to be issued as of the
date first written above.
STRAINWISE, INC., a Utah corporation
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Its: President
119
SCHEDULE A
LOAN ADVANCES AND PAYMENTS OF PRINCIPAL
Green Acres Partners, LLC
Amount of
Principal
Amount of Paid or Unpaid Principal Notation
Date Loan Advance Prepaid Balance Made By
-------------------------------------------------------------------------------
1/30/2015 $350,000 -0- $350,000 ▇▇▇▇▇▇ ▇▇▇▇▇
3/01/2015 $350,000 -0- $700,000 ▇▇▇▇ ▇▇▇▇▇
120
SCHEDULE A
LOAN ADVANCES AND PAYMENTS OF PRINCIPAL
San ▇▇▇▇▇▇▇ Advisors, LLC DBP FBO ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Amount of
Principal
Amount of Paid or Unpaid Principal Notation
Date Loan Advance Prepaid Balance Made By
-------------------------------------------------------------------------------
1/30/2015 $150,000 -0- $150,000 ▇▇▇▇▇▇ ▇▇▇▇▇
3/01/2015 $150,000 -0- $300,000 ▇▇▇▇ ▇▇▇▇▇
121
SCHEDULE A
LOAN ADVANCES AND PAYMENTS OF PRINCIPAL
San ▇▇▇▇▇▇▇ Advisors, LLC
Amount of
Principal
Amount of Paid or Unpaid Principal Notation
Date Loan Advance Prepaid Balance Made By
-------------------------------------------------------------------------------
1/30/2015 $50,000 -0- $50,000 ▇▇▇▇▇▇ ▇▇▇▇▇
122
STRAINWISE, INC.
25% SENIOR CONVERTIBLE PROMISSORY NOTE
CONVERSION NOTICE
The undersigned owner of this Note hereby irrevocably exercises the option
to convert this Note or the portion hereof designated, into shares of common
stock of Strainwise, Inc., a Utah corporation, in accordance with the terms of
this Note, and directs that the shares issuable and deliverable upon the
conversion, together with any check in payment for fractional shares, be issued
in the name of and delivered to the undersigned unless a different name has been
indicated below. If shares are to be issued in the name of a person other than
the undersigned, the undersigned will pay any transfer taxes payable with
respect thereto.
Date: _________________, 201_____
------------------------------------
(Signature)
Title:
------------------------------
FILL IN FOR REGISTRATION OF SHARES
-----------------------------------
(Printed Name)
-----------------------------------
(Social Security or other identifying
number)
-----------------------------------
(Street Address)
-----------------------------------
(City, State, and ZIP Code)
-----------------------------------
Portion to be converted (if less than all)
123
AMENDED AND RESTATED
PERSONAL GUARANTY AGREEMENT
THIS AMENDED AND RESTATED PERSONAL GUARANTY AGREEMENT (this "Guaranty"),
dated as of February 5, 2015, is made by ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇▇
(the "Guarantors"), in favor of Green Acres Partners A, LLC, a Nevada limited
liability company (the "Lender").
RECITALS
WHEREAS, Strainwise, LLC, a Utah corporation (the "Company") and the Lender
are parties to a Senior Loan Agreement and 25% Convertible Promissory Note dated
January 30, 2015
WHEREAS, the Company and the Lender entered into an Amended and Restated
Senior Loan Agreement and an Amended and Restated 25% Convertible Promissory
Note, dated February 5, 2015 (the Senior Loan Agreement and the 25% Convertible
Promissory Note, dated January 30, 2015 and the Amended and Restated Senior Loan
Agreement and the Amended and Restated 25% Convertible Promissory Note, dated
February 5, 2015 will be collectively referred to as the "Loan Documents");
WHEREAS, this Guaranty amends and restates, but does not extinguish,
impair, novate or discharge the obligations evidenced by that certain Personal
Guaranty Agreement, dated January 30, 2015, executed by the Guarantors in favor
of the Lender;
WHEREAS, the Lender has based its investment in part upon the
representation that the Guarantors would guaranty the debts of the Company with
the Lender; and
WHEREAS, the Guarantors have determined that their execution, delivery, and
performance of this Guaranty directly benefits them, and is in their best
interests;
NOW, THEREFORE, in consideration of the premises and the agreements herein
and in order to induce the Lender to enter into and perform the Loan Documents,
the Guarantors hereby agree with the Lender as follows:
1. Definitions. All terms used in this Guaranty, which are defined in the
Loan Documents and not otherwise defined herein, will have the same meanings
herein as set forth therein. The following terms shall have the following
meanings under this Guaranty:
"Material Adverse Effect" means any change or effect that is, or is
reasonably likely to be, materially adverse to the business, assets and
liabilities (taken together), financial condition or operations or results of
operations of the Company and its subsidiaries, taken as a whole; provided,
however, that none of the following shall be deemed (either alone or in
combination) to constitute such a change or effect: (a)(i) any adverse change
attributable to the announcement or pendency of the transactions contemplated by
this Guaranty; or (ii) any adverse change attributable to or conditions
generally affecting the United States economy or financial markets in general;
or (b) any act or threat of terrorism or war anywhere in the world, any armed
124
hostilities or terrorist activities anywhere in the world, any threat or
escalation of armed hostilities or terrorist activities anywhere in the world or
any governmental or other response or reaction to any of the foregoing.
2. Guaranty. The Guarantors hereby unconditionally and irrevocably,
guaranty the punctual payment, as and when due and payable, by stated maturity
or otherwise, of all obligations of the Company from time to time owing by it in
respect to the Loan Documents, including, without limitation, all interest that
accrues after the commencement of any insolvency proceeding of the Company or
the Guarantors, whether or not the payment of such interest is unenforceable or
is not allowable due to the existence of such insolvency proceeding, and all
fees, commissions, expense reimbursements, indemnifications, and all other
amounts due or to become due under any of the Loan Documents (such obligations,
to the extent not paid by the Company, being the "Guaranteed Obligations"), and
agree to pay any and all expenses (including reasonable counsel fees and
expenses) reasonably incurred by the Lender in enforcing any rights under this
Guaranty. Without limiting the generality of the foregoing, the Guarantors'
liability hereunder extends to all amounts that constitute part of the
Guaranteed Obligations and would be owed by the Company to the Lender under the
Loan Documents but for the fact that they are unenforceable or not allowable due
to the existence of an insolvency proceeding involving the Company or the
Guarantors (each, a "Transaction Party").
3. Guaranty Absolute; Continuing Guaranty; Assignments.
a. The Guarantors guaranty that the Guaranteed Obligations will be paid
strictly in accordance with the terms of the Loan Documents,
regardless of any law, regulation or order now or hereafter in effect
in any jurisdiction affecting any of such terms or the rights of the
Lender with respect thereto. The obligations of the Guarantors under
this Guaranty are independent of the Guaranteed Obligations, and a
separate action or actions may be brought and prosecuted against the
Guarantors to enforce such obligations, irrespective of whether any
action is brought against any Transaction Party or whether any
Transaction Party is joined in any such action or actions. The
liability of the Guarantors under this Guaranty will be irrevocable,
absolute, and unconditional irrespective of, and the Guarantors hereby
irrevocably waive, to the extent permitted by law, any defenses it may
now or hereafter have in any way relating to, any or all of the
following:
i. any lack of validity or enforceability of any Loan Document or
any agreement or Guaranty or instrument relating thereto;
ii. any change in the time, manner or place of payment of, or in
any other term of, all or any of the Guaranteed Obligations, or any
other amendment or waiver of or any consent to departure from any Loan
Document, including, without limitation, any increase in the
Guaranteed Obligations resulting from the extension of additional
credit to any Transaction Party or otherwise;
iii. any taking, release or amendment or waiver of or consent to
departure from any other guaranty, for all or any of the Guaranteed
Obligations;
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iv. any change, restructuring or termination of the corporate,
limited liability company or partnership structure or existence of any
Transaction Party; or
v. any other circumstance (including any statute of limitations)
or any existence of or reliance on any representation by the Lender
that might otherwise constitute a defense available to, or a discharge
of, any Transaction Party or any other guarantor or surety.
This Guaranty will continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Guaranteed Obligations is rescinded
or must otherwise be returned by the Lender or any other person upon the
insolvency, bankruptcy or reorganization of any Transaction Party or otherwise,
all as though such payment had not been made.
b. This Guaranty is a continuing guaranty and will (i) remain in full
force and effect until the cash payment in full of the Guaranteed
Obligations (other than inchoate indemnity obligations) and payment of
all other amounts payable under this Guaranty and will not terminate
for any reason prior to the Maturity Date of the Note (other than
payment in full of the Note) and (ii) be binding upon the Guarantors
and their successors and assigns. This Guaranty will inure to the
benefit of and be enforceable by the Lender and its successors, and
permitted pledgees, transferees, and assigns. Without limiting the
generality of the foregoing sentence, the Lender may pledge, assign or
otherwise transfer all or any portion of its rights and obligations
under and subject to the terms of any Loan Documents to any other
person, and such other person will thereupon become vested with all
the benefits in respect thereof granted to Lender herein or otherwise,
in each case as provided in such Loan Document.
4. Waivers. To the extent permitted by applicable law, the Guarantors
hereby waive promptness, diligence, notice of acceptance, and any other notice
with respect to any of the Guaranteed Obligations and this Guaranty and any
requirement that the Lender exhaust any right or take any action against any
Transaction Party or any other person. The Guarantors acknowledge that it will
receive direct and indirect benefits from the financing arrangements
contemplated herein and that the waiver set forth in this Section is knowingly
made in contemplation of such benefits. The Guarantors hereby waive any right to
revoke this Guaranty, and acknowledges that this Guaranty is continuing in
nature and applies to all Guaranteed Obligations, whether existing now or in the
future.
5. Subrogation. The Guarantors may not exercise any rights that they may
now or hereafter acquire against any Transaction Party or any other guarantor
that arise from the existence, payment, performance or enforcement of the
Guarantors' obligations under this Guaranty, including, without limitation, any
right of subrogation, reimbursement, exoneration, contribution or
indemnification, and any right to participate in any claim or remedy of the
Lender against any Transaction Party or any other guarantor, whether or not such
claim, remedy or right arises in equity or under contract, statute or common
law, including, without limitation, the right to take or receive from any
Transaction Party or any other guarantor, directly or indirectly, in cash or
other property or by set-off or in any other manner, payment or security solely
on account of such claim, remedy or right, unless and until all of the
Guaranteed Obligations (other than inchoate indemnity obligations) and all other
amounts payable under this Guaranty have been paid in full in cash. If any
amount is paid to the Guarantors in violation of the immediately preceding
sentence at any time prior to the later of the payment in full in cash of the
Guaranteed Obligations and all other amounts payable under this Guaranty, such
amount will be held in trust for the benefit of the Lender and will forthwith be
paid to the Lender to be credited and applied to the Guaranteed Obligations and
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all other amounts payable under this Guaranty, whether matured or unmatured, in
accordance with the terms of the Loan Documents, or to be held as collateral for
any Guaranteed Obligations or other amounts payable under this Guaranty
thereafter arising. If (a) the Guarantors make payment to the Lender of all or
any part of the Guaranteed Obligations, and (b) all of the Guaranteed
Obligations (other than inchoate indemnity obligations) and all other amounts
payable under this Guaranty are be paid in full in cash, the Lender will, at the
Guarantors' request and expense, execute and deliver to the Guarantors
appropriate documents, without recourse and without representation or warranty,
necessary to evidence the transfer by subrogation to the Guarantors of an
interest in the Guaranteed Obligations resulting from such payment by the
Guarantors.
6. Representations, Warranties and Covenants. The Guarantors hereby
represent and warrant as follows:
a. The execution, delivery and performance by the Guarantors of this
Guaranty and each other Loan Document to which the Guarantors are a party
(i) have been duly authorized by all necessary action, (ii) do not and will
not contravene any applicable law or any contractual restriction binding or
otherwise affecting on the Guarantors or their properties, (iii) do not and
will not result in or require the creation of any lien (other than pursuant
to any Loan Document) upon or with respect to any of their properties, and
(iv) do not and will not result in any default, noncompliance, suspension,
revocation, impairment, forfeiture or nonrenewal of any permit, license,
authorization or approval applicable to it or their operations or any of
their properties.
b. No authorization or approval or other action by, and no notice to
or filing with, any governmental authority is required in connection with
the due execution, delivery and performance by the Guarantors of this
Guaranty or any of the other Loan Document to which the Guarantors are a
party.
c. Each of this Guaranty and the other Loan Documents to which the
Company or the Guarantors are or will be a party, when delivered, will be,
a legal, valid, and binding obligation of the Guarantors, enforceable
against the Guarantors in accordance with its terms, except as may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium,
suretyship or other similar laws.
d. There is no pending or, to the best knowledge of the Guarantors,
threatened action, suit or proceeding affecting the Guarantors or to which
any of the properties of the Guarantors are subject, before any court or
other governmental authority or any arbitrator that (i) if adversely
determined, could reasonably be expected to have a Material Adverse Effect
or (ii) relates to this Guaranty or any of the other Loan Documents to
which the Company or the Guarantors are a party or any transaction
contemplated hereby or thereby.
e. The Guarantors (i) have read and understands the terms and
conditions of the Loan Documents, and (ii) now have and will continue to
have independent means of obtaining information concerning the affairs,
financial condition, and business of the Transaction Parties, and have no
need of, or right to obtain from any Lender, any credit or other
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information concerning the affairs, financial condition or business of the
Transaction Parties that may come under the control of the Lender.
7. Right of Set-off. Upon the occurrence and during the continuance of any
Event of Default under any of the Loan Documents, the Lender may, and is hereby
authorized to, at any time and from time to time, without notice to the
Guarantors (any such notice being expressly waived by the Guarantors) and to the
fullest extent permitted by law, set-off and apply any and all deposits (general
or special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by the Lender to or for the credit or the account
of the Guarantors against any and all obligations of the Company or Guarantors
now or hereafter existing under this Guaranty or any other Loan Document,
irrespective of whether or not any Lender has made any demand under this
Guaranty or any other Loan Document and although such obligations may be
contingent or unmatured. The Lender agrees to notify the Guarantors promptly
after any such set-off and application made by such Lender, provided that the
failure to give such notice shall not affect the validity of such set-off and
application. The rights of the Lender under this Section are in addition to
other rights and remedies (including, without limitation, other rights of
set-off) which the Lender may have under this Guaranty or any other Loan
Document in law or otherwise.
8. Successors and Assigns; Assignment. Except as otherwise expressly
provided herein, the provisions hereof inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto. Nothing in this Guaranty, express or implied, is intended to
confer upon any party, other than the parties hereto and their successors and
assigns, any rights, remedies, obligations or liabilities under or by reason of
this Guaranty, except as expressly provided herein. The Guarantors may not
assign this Guaranty or any of the rights or obligations referenced herein
without the prior written consent of the Lender. The Lender may assign this
Guaranty, in whole or in part, without the prior consent of the Guarantors, and
any assignee of this Guaranty shall inure to all of the rights of the Lender
hereunder.
9. Waiver of Notice. The Guarantors hereby waive notice, presentment,
demand, protest, and notice of dishonor.
10. Notices. Any notice, demand, request, waiver or other communication
required or permitted to be given pursuant to this Guaranty must be in writing
(including electronic format) and will be deemed by the parties to have been
received (i) upon delivery in person (including by reputable express courier
service) at the address set forth below; (ii) upon delivery by electronic mail
(as verified by a printout showing satisfactory transmission) at the electronic
mail address set forth below (if sent on a business day during normal business
hours where such notice is to be received and if not, on the first business day
following such delivery where such notice is to be received); or (iii) upon
receipt if mailed with the United States Postal Service if mailed from and to a
location within the continental United States by registered or certified mail,
return receipt requested, addressed to the address set forth below. Any party
hereto may from time to time change its physical or electronic address or
facsimile number for notices by giving notice of such changed address or number
to the other party in accordance with this section.
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If to the Lender at: Green Acre Partners A, LLC
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Email Address:
▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
With a copy (which
will not constitut
notice) to: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
The Law Office of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ &
Associates, P.C.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Email Address: ▇▇▇@▇▇▇▇▇▇▇▇.▇▇
If to the Guarantors
at: Strainwise, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Email Address: ▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
11. Heading; References. All headings used herein are used for convenience
only and shall not be used to construe or interpret this Guaranty. Except as
otherwise indicated, all references herein to Sections refer to Sections hereof.
12. Binding Agreement; Survival. This Guaranty shall bind and inure to the
benefit of both parties, and except as otherwise expressly provided to the
contrary herein, each of their respective heirs, successors and assigns.
13. Delays or Omissions. No delay or omission to exercise any right, power,
or remedy accruing to the Lender, upon any breach or default of the Debtor under
this Guaranty shall impair any such right, power, or remedy of the Lender nor
shall it be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of or in any similar breach or default thereafter
occurring; nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default therefore or thereafter occurring. All
remedies, either under this Guaranty or by law or otherwise afforded to the
Lender, shall be cumulative and not alternative.
14. Construction. The parties acknowledge that the parties and their
counsel have reviewed and revised this Guaranty and that the language used in
this Guaranty has been chosen by the parties to express their mutual intent.
Accordingly, no rules of strict construction will be applied against any party
with respect to this Guaranty.
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15. Cumulative Rights. No delay on the part of the Lender in the exercise
of any power or right under this Guaranty or under any other instrument executed
pursuant to this Guaranty shall operate as a waiver of any such power or right,
nor shall a single or partial exercise of any power or right preclude other or
further exercise of such power or right or the exercise of any other power or
right.
16. Payments Free of Taxes, Etc. All payments made by the Guarantors under
these Loan Document shall be made by the Guarantors free and clear of and
without deduction for any and all present and future taxes, levies, charges,
deductions, and withholdings. In addition, the Guarantors shall pay upon demand
any stamp or other taxes, levies or charges of any jurisdiction with respect to
the execution, delivery, registration, performance, and enforcement of this
Guaranty. Upon request by the Lender, the Guarantors shall furnish evidence
satisfactory to the Lenders that all requisite authorizations and approvals by,
and notices to and filings with, governmental authorities and regulatory bodies
have been obtained and made and that all requisite taxes, levies, and charges
have been paid.
17. Severability. If one or more provisions of this Guaranty are held to be
unenforceable under applicable law, such provision(s) shall be excluded from
this Guaranty and the balance of this Guaranty shall be interpreted as if such
provision(s) were so excluded and shall be enforceable in accordance with its
terms.
18. Other Interpretive Provisions. References in the Loan Documents to any
document, instrument or agreement (a) includes all exhibits, schedules, and
other attachments thereto, (b) includes all documents, instruments or agreements
issued or executed in replacement thereof, and (c) means such document,
instrument or agreement, or replacement or predecessor thereto, as amended,
modified and supplemented from time to time and in effect at any given time. The
words "hereof," "herein" and "hereunder" and words of similar import when used
in this Guaranty refers to this Guaranty as a whole and not to any particular
provision of this Guaranty. The words "include" and "including" and words of
similar import when used in this Guaranty shall not be construed to be limiting
or exclusive.
19. No Oral Modification or Waivers. The terms herein may not be modified
or waived orally, but only by an instrument in writing signed by the party
against which enforcement of the modification or waiver is sought.
20. Attorneys' Fees. In the event of any suit or action to enforce or
interpret any provision of this Guaranty or otherwise arising out of this
Guaranty, the prevailing party is entitled to recover, in addition to other
direct incremental costs, reasonable attorney fees in connection with the suit,
action, or arbitration, and in any appeals.
21. Governing Law; Jurisdiction; Venue. This Guaranty, and all matters
arising directly and indirectly herefrom (the "Covered Matters"), shall be
governed in all respects by the laws of the State of Colorado as such laws are
applied to agreements between parties in Colorado. The Lender and the Guarantors
irrevocably submit to the personal jurisdiction of the courts of the State of
Colorado and the United States District Court for the District of Colorado for
the purpose of any suit, action, proceeding or judgment relating to or arising
130
out of the Covered Matters. Service of process on the Lender or the Guarantors
in connection with any such suit, action or proceeding may be served on the
Lender or the Guarantors anywhere in the world by the same methods as are
specified for the giving of notices under this Guaranty. The Lender and the
Guarantors irrevocably consent to the jurisdiction of any such court in any such
suit, action or proceeding and to the laying of venue in such court. The Lender
and the Guarantors irrevocably waive any objection to the laying of venue of any
such suit, action or proceeding brought in such courts and irrevocably waives
any claim that any such suit, action or proceeding brought in any such court has
been brought in an inconvenient forum.
22. Entire Agreement; Integration Clause. This Guaranty sets forth the
entire agreement and understandings of the parties hereto with respect to this
transaction, and this Guaranty supersedes and nullifies all other agreements
made between the parties hereto.
23. Counterparts. This Guaranty may be executed in as many counterpart
copies as may be required. All counterparts shall collectively constitute a
single agreement.
[Signature page follows]
131
IN WITNESS WHEREOF, the Guarantors have caused this Guaranty to be
executed as of the date first above written.
GUARANTORS
Signature: /s/ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Signature: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
132
AMENDED AND RESTATED
SUBSIDIARY GUARANTY AGREEMENT
THIS AMENDED AND RESTATED SUBSIDIARY GUARANTY AGREEMENT (this "Guaranty"),
dated as of February 5, 2015 is made by Strainwise, Inc., a Colorado corporation
(the "Guarantor"), in favor of Green Acres Partners A, LLC, a Nevada limited
liability company (the "Lender").
RECITALS
WHEREAS, Strainwise, Inc., a Utah corporation (the "Company") and the
Lender are parties to a Senior Loan Agreement and 25% Convertible Promissory
Note dated January 30, 2015;
WHEREAS, the Company and the Lender entered into an Amended and Restated
Senior Loan Agreement and an Amended and Restated 25% Convertible Promissory
Note, dated February 5, 2015 (the Senior Loan Agreement and the 25% Convertible
Promissory Note, dated January 30, 2015 and the Amended and Restated Senior Loan
Agreement and the Amended and Restated 25% Convertible Promissory Note, dated
February 5, 2015 will be collectively referred to as the "Loan Documents");
WHEREAS, this Guaranty amends and restates, but does not extinguish,
impair, novate or discharge the obligations evidenced by that certain Guaranty
Agreement, dated January 30, 2015, executed by the Guarantor(1) in favor of the
Lender;
WHEREAS, the Lender has based its investment in part upon the
representation that the Guarantor would guaranty the debts of the Company with
the Lender; and
WHEREAS, the Guarantor has determined that its execution, delivery, and
performance of this Guaranty directly benefits it, and is in its best interests.
NOW, THEREFORE, in consideration of the premises and the agreements herein
and in order to induce the Lender to enter into and perform the Loan Documents,
the Guarantor hereby agrees with the Lender as follows:
24. Definitions. All terms used in this Guaranty, which are defined in the
Loan Documents and not otherwise defined herein, will have the same meanings
herein as set forth therein. The following terms shall have the following
meanings under this Guaranty:
"Material Adverse Effect" means any change or effect that is, or is
reasonably likely to be, materially adverse to the business, assets and
liabilities (taken together), financial condition or operations or results of
operations of the Company and its subsidiaries, taken as a whole; provided,
however, that none of the following shall be deemed (either alone or in
combination) to constitute such a change or effect: (a)(i) any adverse change
attributable to the announcement or pendency of the transactions contemplated by
133
this Guaranty; or (ii) any adverse change attributable to or conditions
generally affecting the United States economy or financial markets in general;
or (b) any act or threat of terrorism or war anywhere in the world, any armed
hostilities or terrorist activities anywhere in the world, any threat or
escalation of armed hostilities or terrorist activities anywhere in the world or
any governmental or other response or reaction to any of the foregoing.
25. Guaranty. The Guarantor hereby unconditionally and irrevocably,
guaranties the punctual payment, when due and payable, by stated maturity or
otherwise, of all obligations of the Company from time to time owing by it in
respect to the Loan Documents, including, without limitation, all interest that
accrues after the commencement of any insolvency proceeding of the Company or
the Guarantor, whether or not the payment of such interest is unenforceable or
is not allowable due to the existence of such insolvency proceeding, and all
fees, commissions, expense reimbursements, indemnifications, and all other
amounts due or to become due under any of the Loan Documents (such obligations,
to the extent not paid by the Company, being the "Guaranteed Obligations"), and
agrees to pay any and all expenses (including reasonable counsel fees and
expenses) reasonably incurred by the Lender in enforcing any rights under this
Guaranty. Without limiting the generality of the foregoing, the Guarantor's
liability hereunder extends to all amounts that constitute part of the
Guaranteed Obligations and would be owed by the Company to the Lender under the
Loan Documents but for the fact that they are unenforceable or not allowable due
to the existence of an insolvency proceeding involving the Guarantor or the
Company (each, a "Transaction Party").
26. Guaranty Absolute; Continuing Guaranty; Assignments.
a. The Guarantor guaranties that the Guaranteed Obligations will be
paid strictly in accordance with the terms of the Loan Documents,
regardless of any law, regulation or order now or hereafter in effect in
any jurisdiction affecting any of such terms or the rights of the Lender
with respect thereto. The obligations of the Guarantor under this Guaranty
are independent of the Guaranteed Obligations, and a separate action or
actions may be brought and prosecuted against the Guarantor to enforce such
obligations, irrespective of whether any action is brought against any
Transaction Party or whether any Transaction Party is joined in any such
action or actions. The liability of the Guarantor under this Guaranty will
be irrevocable, absolute, and unconditional irrespective of, and the
Guarantor hereby irrevocably waives, to the extent permitted by law, any
defenses it may now or hereafter have in any way relating to, any or all of
the following:
i. any lack of validity or enforceability of any Loan Document or
any agreement, Guaranty or instrument relating thereto;
ii. any change in the time, manner or place of payment of, or in
any other term of, all or any of the Guaranteed Obligations, or any
other amendment or waiver of or any consent to departure from any Loan
Document, including, without limitation, any increase in the
Guaranteed Obligations resulting from the extension of additional
credit to any Transaction Party or otherwise;
134
iii. any taking, release or amendment or waiver of or consent to
departure from any other guaranty, for all or any of the Guaranteed
Obligations;
iv. any change, restructuring or termination of the corporate,
limited liability company or partnership structure or existence of any
Transaction Party; or
v. any other circumstance (including any statute of limitations)
or any existence of or reliance on any representation by the Lender
that might otherwise constitute a defense available to, or a discharge
of, any Transaction Party or any other guarantor or surety.
This Guaranty will continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Guaranteed Obligations is rescinded
or must otherwise be returned by the Lender or any other person upon the
insolvency, bankruptcy or reorganization of any Transaction Party or otherwise,
all as though such payment had not been made.
b. This Guaranty is a continuing guaranty and will (i) remain in
full force and effect until the cash payment in full of the Guaranteed
Obligations (other than inchoate indemnity obligations) and payment of
all other amounts payable under this Guaranty and will not terminate
for any reason prior to the Maturity Date of the Note (other than
payment in full of the Note) and (ii) be binding upon the Guarantor
and his successors and assigns. This Guaranty will inure to the
benefit of and be enforceable by the Lender and its successors, and
permitted pledgees, transferees, and assigns. Without limiting the
generality of the foregoing sentence, the Lender may pledge, assign or
otherwise transfer all or any portion of its rights and obligations
under and subject to the terms of any Loan Documents to any other
person, and such other person will thereupon become vested with all
the benefits in respect thereof granted to Lender herein or otherwise,
in each case as provided in such Loan Document.
27. Waivers. To the extent permitted by applicable law, the Guarantor
hereby waives promptness, diligence, notice of acceptance, and any other notice
with respect to any of the Guaranteed Obligations and this Guaranty and any
requirement that the Lender exhaust any right or take any action against any
Transaction Party or any other person. The Guarantor acknowledges that it will
receive direct and indirect benefits from the financing arrangements
contemplated herein and that the waiver set forth in this Section is knowingly
made in contemplation of such benefits. The Guarantor hereby waives any right to
revoke this Guaranty, and acknowledges that this Guaranty is continuing in
nature and applies to all Guaranteed Obligations, whether existing now or in the
future.
28. Subrogation. The Guarantor may not exercise any rights that it may now
or hereafter acquire against any Transaction Party or any other guarantor that
arise from the existence, payment, performance or enforcement of the Guarantor's
obligations under this Guaranty, including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution or indemnification, and
any right to participate in any claim or remedy of the Lender against any
Transaction Party or any other guarantor, whether or not such claim, remedy or
right arises in equity or under contract, statute or common law, including,
135
without limitation, the right to take or receive from any Transaction Party or
any other guarantor, directly or indirectly, in cash or other property or by
set-off or in any other manner, payment or security solely on account of such
claim, remedy or right, unless and until all of the Guaranteed Obligations
(other than inchoate indemnity obligations) and all other amounts payable under
this Guaranty have been paid in full in cash. If any amount is paid to the
Guarantor in violation of the immediately preceding sentence at any time prior
to the later of the payment in full in cash of the Guaranteed Obligations and
all other amounts payable under this Guaranty, such amount will be held in trust
for the benefit of the Lender and will forthwith be paid to the Lender to be
credited and applied to the Guaranteed Obligations and all other amounts payable
under this Guaranty, whether matured or unmatured, in accordance with the terms
of the Loan Documents, or to be held as collateral for any Guaranteed
Obligations or other amounts payable under this Guaranty thereafter arising. If
(a) the Guarantor makes payment to the Lender of all or any part of the
Guaranteed Obligations, and (b) all of the Guaranteed Obligations (other than
inchoate indemnity obligations) and all other amounts payable under this
Guaranty are be paid in full in cash, the Lender will, at the Guarantor's
request and expense, execute and deliver to the Guarantor appropriate documents,
without recourse and without representation or warranty, necessary to evidence
the transfer by subrogation to the Guarantor of an interest in the Guaranteed
Obligations resulting from such payment by the Guarantor.
29. Representations, Warranties and Covenants. The Guarantor hereby
represents and warrants as follows:
a. The execution, delivery and performance by the Guarantor of this
Guaranty and each other Loan Document to which the Guarantor is a party (i)
have been duly authorized by all necessary actions, (ii) do not and will
not contravene its charter or by-laws, or any applicable law or any
contractual restriction binding or otherwise affecting on the Guarantor or
its properties, (iii) do not and will not result in or require the creation
of any lien (other than pursuant to any Loan Document) upon or with respect
to any of its properties, and (iv) do not and will not result in any
default, noncompliance, suspension, revocation, impairment, forfeiture or
nonrenewal of any permit, license, authorization or approval applicable to
it or its operations or any of its properties.
b. No authorization or approval or other action by, and no notice to
or filing with, any governmental authority is required in connection with
the due execution, delivery and performance by the Guarantor of this
Guaranty or any of the other Loan Document to which the Guarantor is a
party.
c. Each of this Guaranty and the other Loan Documents to which the
Guarantor or the Company is or will be a party, when delivered, will be, a
legal, valid, and binding obligation of the Guarantor, enforceable against
the Guarantor in accordance with its terms, except as may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, suretyship
or other similar laws.
d. There is no pending or, to the best knowledge of the Guarantor,
threatened action, suit or proceeding affecting the Guarantor or to which
any of the properties of the Guarantor are subject, before any court or
other governmental authority or any arbitrator that (i) if adversely
determined, could reasonably be expected to have a Material Adverse Effect
or (ii) relates to this Guaranty or any of the other Loan Documents to
which the Guarantor or the Company are a party or any transaction
contemplated hereby or thereby.
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e. The Guarantor (i) has read and understands the terms and conditions
of the Loan Documents, and (ii) now has and will continue to have
independent means of obtaining information concerning the affairs,
financial condition, and business of the Transaction Parties, and has no
need of, or right to obtain from any Lender, any credit or other
information concerning the affairs, financial condition or business of the
Transaction Parties that may come under the control of any Lender.
30. Right of Set-off. Upon the occurrence and during the continuance of any
Event of Default under any of the Loan Documents, the Lender may, and is hereby
authorized to, at any time and from time to time, without notice to the
Guarantor (any such notice being expressly waived by the Guarantor) and to the
fullest extent permitted by law, set-off and apply any and all deposits (general
or special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by the Lender to or for the credit or the account
of the Guarantor against any and all obligations of the Guarantor now or
hereafter existing under this Guaranty or any other Loan Document, irrespective
of whether or not any Lender has made any demand under this Guaranty or any
other Loan Document and although such obligations may be contingent or
unmatured. The Lender agrees to notify the Guarantor promptly after any such
set-off and application made by such Lender, provided that the failure to give
such notice shall not affect the validity of such set-off and application. The
rights of the Lender under this Section are in addition to other rights and
remedies (including, without limitation, other rights of set-off) which the
Lender may have under this Guaranty or any other Loan Document in law or
otherwise.
31. Successors and Assigns; Assignment. Except as otherwise expressly
provided herein, the provisions hereof inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto. Nothing in this Guaranty, express or implied, is intended to
confer upon any party, other than the parties hereto and their successors and
assigns, any rights, remedies, obligations or liabilities under or by reason of
this Guaranty, except as expressly provided herein. The Guarantor may not assign
this Guaranty or any of the rights or obligations referenced herein without the
prior written consent of the Lender. The Lender may assign this Guaranty, in
whole or in part, without the prior consent of the Guarantor, and any assignee
of this Guaranty shall inure to all of the rights of the Lender hereunder.
32. Waiver of Notice. The Guarantor hereby waives notice, presentment,
demand, protest, and notice of dishonor.
33. Notices. Any notice, demand, request, waiver or other communication
required or permitted to be given pursuant to this Guaranty must be in writing
(including electronic format) and will be deemed by the parties to have been
received (i) upon delivery in person (including by reputable express courier
service) at the address set forth below; (ii) upon delivery by electronic mail
(as verified by a printout showing satisfactory transmission) at the electronic
mail address set forth below (if sent on a business day during normal business
hours where such notice is to be received and if not, on the first business day
following such delivery where such notice is to be received); or (iii) upon
receipt if mailed with the United States Postal Service if mailed from and to a
location within the continental United States by registered or certified mail,
return receipt requested, addressed to the address set forth below. Any party
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hereto may from time to time change its physical or electronic address or
facsimile number for notices by giving notice of such changed address or number
to the other party in accordance with this section.
If to the Lender at: Green Acre Partners A, LLC
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Email Address:
▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
With a copy (which will not
constitute notice) to: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
The Law Office of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ &
Associates, P.C.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Email Address: ▇▇▇@▇▇▇▇▇▇▇▇.▇▇
If to the Guarantor at: Strainwise, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Email Address: ▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
34. Heading; References. All headings used herein are used for convenience
only and shall not be used to construe or interpret this Guaranty. Except as
otherwise indicated, all references herein to Sections refer to Sections hereof.
35. Binding Agreement; Survival. This Guaranty shall bind and inure to the
benefit of both parties, and except as otherwise expressly provided to the
contrary herein, each of their respective heirs, successors and assigns.
36. Delays or Omissions. No delay or omission to exercise any right, power,
or remedy accruing to the Lender, upon any breach or default of the Debtor under
this Guaranty shall impair any such right, power, or remedy of the Lender nor
shall it be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of or in any similar breach or default thereafter
occurring; nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default therefore or thereafter occurring. All
remedies, either under this Guaranty or by law or otherwise afforded to the
Lender, shall be cumulative and not alternative.
37. Construction. The parties acknowledge that the parties and their
counsel have reviewed and revised this Guaranty and that the language used in
this Guaranty has been chosen by the parties to express their mutual intent.
Accordingly, no rules of strict construction will be applied against any party
with respect to this Guaranty.
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38. Cumulative Rights. No delay on the part of the Lender in the exercise
of any power or right under this Guaranty or under any other instrument executed
pursuant to this Guaranty shall operate as a waiver of any such power or right,
nor shall a single or partial exercise of any power or right preclude other or
further exercise of such power or right or the exercise of any other power or
right.
39. Payments Free of Taxes, Etc. All payments made by the Guarantor under
these e Loan Documents shall be made by the Guarantor free and clear of and
without deduction for any and all present and future taxes, levies, charges,
deductions, and withholdings. In addition, the Guarantor shall pay upon demand
any stamp or other taxes, levies or charges of any jurisdiction with respect to
the execution, delivery, registration, performance, and enforcement of this
Guaranty. Upon request by the Lender, the Guarantor shall furnish evidence
satisfactory to the Lender that all requisite authorizations and approvals by,
and notices to and filings with, governmental authorities and regulatory bodies
have been obtained and made and that all requisite taxes, levies, and charges
have been paid.
40. Severability. If one or more provisions of this Guaranty are held to be
unenforceable under applicable law, such provision(s) shall be excluded from
this Guaranty and the balance of this Guaranty shall be interpreted as if such
provision(s) were so excluded and shall be enforceable in accordance with its
terms.
41. Other Interpretive Provisions. References in the Loan Documents to any
document, instrument or agreement (a) includes all exhibits, schedules, and
other attachments thereto, (b) includes all documents, instruments or agreements
issued or executed in replacement thereof, and (c) means such document,
instrument or agreement, or replacement or predecessor thereto, as amended,
modified and supplemented from time to time and in effect at any given time. The
words "hereof," "herein" and "hereunder" and words of similar import when used
in this Guaranty refers to this Guaranty as a whole and not to any particular
provision of this Guaranty. The words "include" and "including" and words of
similar import when used in this Guaranty shall not be construed to be limiting
or exclusive.
42. No Oral Modification or Waivers. The terms herein may not be modified
or waived orally, but only by an instrument in writing signed by the party
against which enforcement of the modification or waiver is sought.
43. Attorneys' Fees. In the event of any suit or action to enforce or
interpret any provision of this Guaranty or otherwise arising out of this
Guaranty, the prevailing party is entitled to recover, in addition to other
direct incremental costs, reasonable attorney fees in connection with the suit,
action, or arbitration, and in any appeals.
44. Governing Law; Jurisdiction; Venue. This Guaranty, and all matters
arising directly and indirectly herefrom (the "Covered Matters"), shall be
governed in all respects by the laws of the State of Colorado as such laws are
applied to agreements between parties in Colorado. The Lender and the Guarantor
irrevocably submit to the personal jurisdiction of the courts of the State of
Colorado and the United States District Court for the District of Colorado for
the purpose of any suit, action, proceeding or judgment relating to or arising
out of the Covered Matters. Service of process on the Lender or the Guarantor in
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connection with any such suit, action or proceeding may be served on the Lender
or the Guarantor anywhere in the world by the same methods as are specified for
the giving of notices under this Guaranty. The Lender and the Guarantor
irrevocably consent to the jurisdiction of any such court in any such suit,
action or proceeding and to the laying of venue in such court. The Lender and
the Guarantor irrevocably waive any objection to the laying of venue of any such
suit, action or proceeding brought in such courts and irrevocably waives any
claim that any such suit, action or proceeding brought in any such court has
been brought in an inconvenient forum.
45. Entire Agreement; Integration Clause. This Guaranty sets forth the
entire agreement and understandings of the parties hereto with respect to this
transaction, and this Guaranty supersedes and nullifies all other agreements
made between the parties hereto.
46. Counterparts. This Guaranty may be executed in as many counterpart
copies as may be required. All counterparts shall collectively constitute a
single agreement.
[Signature page follows]
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IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executed
as of the date first above written.
GUARANTOR
STRAINWISE, INC., a Colorado corporation
Signature: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------
By: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Its: President
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