KIBUSH CAPITAL CORP.
PROMISSORY NOTE CONSOLIDATION AGREEMENT

 

This PROMISSORY NOTE CONSOLIDATION AGREEMENT (this “Agreement”) is made and
entered into as of January 15, 2020, by and among Kibush Capital Corp., a Nevada
corporation (“Company”), the existing Debtor set forth on Schedule 1 attached
hereto (the “Debtor”), and Warren Sheppard., the existing creditor of the Debtor
(the “Creditor”). The Company, the Debtor and the Creditor are sometimes
individually referred to herein as a “Party”, and collectively as, the
“Parties”.

 

RECITALS

 

WHEREAS, the Debtor and Creditor are parties to those certain promissory notes
set forth on Schedule 2, attached hereto (such promissory notes, the
“Outstanding Notes”), and certain of the Outstanding Notes are unsecured unless
pursuant to the terms as disclosed and set forth on Schedule 3, attached hereto
(such security agreements, the “Security Agreements”);

 

WHEREAS, as of the date hereof, the outstanding principal and accrued but unpaid
interest outstanding under the Outstanding Notes is set forth beside each
Outstanding Note on Schedule 2, attached hereto (the aggregate amount of such
principal and accrued but unpaid interest due under all Outstanding Notes, the
“Aggregate Debt Amount”);

 

WHEREAS, the Company, and the Parties have determined that it is mutually
beneficial and in each of their respective best interests to (i) consolidate the
Aggregate Debt Amount and all Outstanding Notes into a single unsecured
promissory note, in substantially the form attached hereto as Exhibit A (the
“Note”), between the Company and the Creditor, and (ii) terminate any existing
Security Agreements (if any) and extinguish and terminate all security or
conversion interests granted by the Debtor to secure the Aggregate Debt Amount
and all other obligations owing under the Outstanding Notes (such transactions,
the “Note Consolidation”); and

 

WHEREAS, the Parties desire to enter into this Agreement to provide for the
terms and conditions of the Note Consolidation.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
promises, representations, warranties, and covenants hereinafter set forth and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:

 

1. Note Consolidation.

 

1.1 Assignment and Assumption. Subject to the terms and conditions of this
Agreement, at the Closing (as defined below), (a) the Debtor hereby irrevocably
assign and transfer unto the Company all of the Outstanding Notes and the
Debtor’ respective rights, obligations and liabilities owing to the Creditor
under the Outstanding Notes as of the Closing including, without limitation, all
monetary obligations, indebtedness and the obligation to pay the Aggregate Debt
Amount (collectively, the “Obligations”), and (b) the Company hereby irrevocably
accepts, assumes and agrees to discharge in full the Outstanding Notes on behalf
of the Debtor and all such Obligations.

 

 

 

 

1.2 Issuance of Note. Subject to the terms and conditions of this Agreement, at
the Closing (as defined below), the Company shall issue to the Creditor the
Note. Effective as of the Closing, the Note shall be deemed to amend and replace
in their entirety and restate all of the Outstanding Notes. The terms and
conditions of the Note shall supersede, effective as of the Closing, the terms
and conditions of the Outstanding Notes; provided, however, that the obligations
incurred under the Outstanding Notes and as evidenced by the Outstanding Notes
shall continue under the Note, and shall not in any circumstance be terminated,
extinguished or discharged hereby but shall hereafter be governed by the terms
of the Note.

 

1.3 Security and Collateral.

 

(a)Termination. Effective upon the Closing, (i) all mortgages, hypothecs,
charges, liens and other security interests (if any) of the Creditor in the real
and personal property of the Debtor and their respective affiliates in which the
Debtor or any one of their respective affiliates has granted to any Debtor a
security interest or charge or given to any Debtor a mortgage to secure its
obligations to any Debtor under the Outstanding Notes and Security Agreements
(collectively, the “Collateral”), and all guarantees of the Obligations, shall
be forever automatically, irrevocably and unconditionally satisfied, released
and discharged without further action; and (ii) the Security Agreements shall be
deemed terminated and of no further force or effect.

 

(b)Execution of Instruments and Filings. Effective upon the Closing, the
Creditor agrees, to: (i) promptly execute and deliver to the Company and the
Debtor, as applicable, or their respective designees, at any registrations of
deeds or instruments of discharge necessary or desirable to release and
discharge any security interest granted under the Outstanding Notes and Security
Agreements, including, without limitation, any Uniform Commercial Code
termination statements, mortgage releases, intellectual property security
agreement releases, account control agreement terminations or release statements
pertaining to liens, charges and security interests heretofore granted to the
Creditor with respect to the Collateral and all guarantees of the Obligations as
the Company and the Debtor, as applicable, or their respective designees, may
reasonably request; (ii) deliver to the Company and the Debtor, as applicable,
or their respective designees all Outstanding Notes, Security Agreements and
other instruments (other than the Note) marked “Cancelled” and (iii) deliver
promptly such other termination statements or documents as the Company and the
Debtor, as applicable, or their respective designees, may from time to time
reasonably request to effectuate or reflect of public record, the release and
discharge of such security interests, mortgages, hypothecs and liens; provided,
that, immediately upon the Closing, the Creditor will deliver all stock
certificates and other possessory collateral to the Company and the Debtor, as
applicable, or their respective designees. Further, the Company and the Debtor,
as applicable, or their respective designees, are authorized by the Creditor,
following issuance of the Note, to file, without the signature of the Creditor,
to the extent permitted by applicable law, such termination statements, deeds or
instruments of discharge with respect to liens under the Outstanding Notes and
Security Agreements, mortgage release documents, intellectual property release
documents, account control agreement terminations and such other instruments of
release and discharge pertaining to the security interests, charges, mortgages,
hypothecs and other liens described above of the Creditor, in any of the
property, real or personal of the Company and the Debtor, as applicable or their
respective affiliates, as Company and the Debtor, as applicable, or their
respective designees may reasonably deem necessary to effectuate or reflect of
public record, the release and discharge of all such security interests,
charges, mortgages, hypothecs and liens.

 

 

 

 

1.4 Closing. The Note Consolidation contemplated hereunder shall take place at
the offices of the Company at 10:00 a.m. local time on the date hereof, or at
such other time and place as the Company and the Creditor mutually determine
(which time and place are designated as the “Closing”).

 

2. Representations and Warranties of the Parties. Each of the Parties represents
and warrants, as to itself only, to each of the other Parties as of the Closing
as follows:

 

2.1 Organization and Standing. Such Party is a corporation or limited liability
company, as the case may be, duly incorporated or formed and validly existing
under, and by virtue of, the laws of its jurisdiction of organization, and such
Party is in good standing under such laws.

 

2.2 Power. Such Party has all requisite corporate or limited liability company,
as applicable, power and authority to execute and deliver this Agreement and the
other documents to be executed and delivered by it hereunder and to carry out
and perform its respective obligations under the terms of this Agreement and the
other documents to be executed and delivered by it hereunder.

 

2.3 Authorization. All corporate or limited liability company, as applicable,
action on the part of such Party, its officers, directors, managers, members and
stockholders necessary for the authorization, execution and delivery by such
Party of this Agreement and the other documents to be executed and delivered by
it hereunder and the performance of all of its respective obligations hereunder
and thereunder has been taken or will be taken prior to the Closing. This
Agreement and the other documents to be executed and delivered by it hereunder,
when executed and delivered by such Party, shall constitute valid and binding
obligations of such Party, enforceable in accordance with each of their
respective terms, except (a) as limited by laws of general application relating
to bankruptcy, insolvency and the relief of Debtor and (b) as limited by rules
of law governing specific performance, injunctive relief or other equitable
remedies and by general principles of equity.

 

2.4 Tax Advisors. Each Party has reviewed with its own tax advisors the U.S.
federal, state, local and foreign tax consequences of the transactions
contemplated by this Agreement. With respect to such matters, the Parties are
relying solely on such advisors and not on any statements or representations of
any other Party or any of their respective agents, written or oral. Each Party
understands that it, and not any other Party, shall be responsible for its own
tax liability that may arise as a result of the transactions contemplated by
this Agreement.

 

 

 

 

3. Conditions to the Parties’ Obligations to Close. Each of the Parties’
obligation at the Closing is subject to the fulfillment on or before the Closing
of each of the following conditions, unless waived by the applicable Party:

 

3.1 Representations and Warranties. The representations and warranties made by
each of the other Parties in Section 2 shall be true and correct in all material
respects as of the date of the Closing.

 

3.2 Covenants. All covenants, agreements and conditions contained in this
Agreement, to be performed by the other Parties on or prior to the Closing shall
have been performed or complied with in all material respects.

 

3.3 Proceedings and Documents. All corporate, limited liability company and
other proceedings, each as applicable to such Party, in connection with the
transactions contemplated at the Closing and all documents and instruments
incident to such transactions shall be reasonably satisfactory in substance and
form to such Party and its counsel, and the Party and its counsel shall have
received all such counterpart originals or certified or other copies of such
documents as they may reasonably request.

 

4. Confidentiality. Except as may be required by any law or regulation, the
Parties agree that they will maintain the confidentiality of any proprietary
information of the Company obtained by it pursuant to the this Agreement or by
virtue of its relationship as a creditor of the Company and Debtor, which is not
otherwise lawfully available from other sources, subject to the disclosure of
information of a non-technical nature, including summary financial information,
which the Creditors may disclose to its respective partners, stockholders and/or
affiliates so long as such partners, stockholders and/or affiliates agree to
maintain the confidentiality of such information.

 

5. Miscellaneous.

 

5.1 Survival. The warranties, representations and covenants of the Parties
contained in or made pursuant to this Agreement shall survive the execution and
delivery of this Agreement and the Closing and shall in no way be affected by
any investigation of the subject matter thereof made by or on behalf of such
Party.

 

5.2 Notices. All notices and other communications required or permitted
hereunder shall be in writing and shall be mailed by registered or certified
mail, postage prepaid, sent by facsimile, sent by electronic mail, or otherwise
delivered by hand or by messenger addressed:

 

(a) if to the Creditor: Warren Sheppard, 2215-B Renaissance Drive, Las Vegas, NV
89119.

 

(b) if to the Company or any Debtor: Kibush Capital Corp., 2215-B Renaissance
Drive, Las Vegas, NV 89119, with a copy (which shall not constitute notice) to:
Andrew Coldicutt, Esq., 1220 Rosecrans St., PMB 258 San Diego CA 92106 or at
Andrew@ColdicuttLaw.com.

 

 

 

 

Any such notice or communication shall be deemed to have been received (i) in
the case of personal delivery, on the date of such delivery, (ii) in the case of
a nationally-recognized overnight courier, on the next business day after the
date when sent (or, in the case of international deliveries, on the second
business day after the date when sent), (iii) in the case of mailing, at the
earlier of its receipt or on the third business day following that on which the
piece of mail containing such communication is posted, (iv) in the case of
delivery via facsimile, upon confirmation of facsimile transfer and (v) in the
case of electronic mail, the day sent when sent during normal business hours.

 

5.3 Successors and Assigns. Except as otherwise provided herein, the terms and
conditions of this Agreement shall inure to the benefit of and be binding upon
the respective successors and assigns of the Parties (including permitted
transferees of the Note). Nothing in this Agreement, express or implied, is
intended to confer upon any Party, other than the Parties hereto or their
respective successors and assigns, any rights, remedies, obligations or
liabilities under or by reason of this Agreement, except as expressly provided
in this Agreement.

 

5.4 Governing Law; Jurisdiction; Venue; Service of Process. This Agreement shall
be governed by and construed under the laws of the State of New York as applied
to agreements among New York residents entered into and to be performed entirely
within New York, without regard to its conflict of law principles. The Parties
hereby submit to the personal jurisdiction of, and agree that any legal
proceeding with respect to or arising under this Agreement, the Outstanding
Notes, the Security Agreements or the Note, shall be brought solely and
exclusively in the state courts of the State of New York sitting in New York
City and the United States District Court for the Southern District of New York,
if such court has subject matter jurisdiction.

 

5.5 Titles and Subtitles. The titles and subtitles used in this Agreement are
used for convenience only and are not to be considered in construing or
interpreting this Agreement.

 

5.6 Expenses. Each Party shall be responsible for its own costs and expenses in
connection with the negotiation, execution and performance of this Agreement. If
any action at law or in equity is necessary to enforce or interpret the terms of
this Agreement, the prevailing Party shall be entitled to reasonable attorney’s
fees, costs and necessary disbursements in addition to any other relief to which
such Party may be entitled.

 

5.7 Amendments and Waivers. Except as expressly provided herein, neither this
Agreement nor any term hereof may be amended, waived, discharged or terminated
other than by a written instrument referencing this Agreement and signed by the
Parties hereto. No waivers of or exceptions to any term, condition, or provision
of this Agreement, in any one or more instances, shall be deemed to be or
construed as a further or continuing waiver of any such term, condition, or
provision.

 

5.8 Severability. If one or more provisions of this Agreement are held to be
unenforceable under applicable law, such provision shall be excluded from this
Agreement and the balance of the Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in accordance with its
terms.

 

5.9 Entire Agreement. This Agreement, the exhibits attached hereto, and the
documents referenced herein constitute the entire agreement among the Parties
and no Party shall be liable or bound to any other Party in any manner by any
warranties, representations or covenants except as specifically set forth herein
or therein. This Agreement supersedes any and all prior agreements,
negotiations, correspondence, understandings and communications among the
Parties, whether written or oral, respecting the subject matter hereof.

 

5.10 Counterparts. This Agreement may be executed in multiple counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument. An original signature or copy thereof transmitted
by facsimile or other electronic transmission shall constitute an original
signature for purposes of this Agreement.

 

[SIGNATURE PAGES TO FOLLOW]

 

 

 

 

IN WITNESS WHEREOF, this Agreement is executed as of the date first written
above.

 

COMPANY: KIBUSH CAPITAL CORP.,         By: /s/ Warren Sheppard   Name: Warren
Sheppard   Title: Chief Executive Officer  

 

(Kibush Capital Corp. - Signature Page to Promissory Note Consolidation
Agreement)

 

IN WITNESS WHEREOF, this Agreement is executed as of the date first written
above.

 

DEBTOR: KIBUSH CAPITAL CORP.,         By: /s/ Warren Sheppard   Name: Warren
Sheppard   Title: Chief Executive Officer  

 

IN WITNESS WHEREOF, this Agreement is executed as of the date first written
above.

 

CREDITOR: Warren Sheppard         By: /s/ Warren Sheppard   Name: Warren
Sheppard   Title:    

 

 

 

 

SCHEDULE 1

 

Schedule of Debtor

 

Kibush Capital Corp.

 

*** End Schedule 1 ***

 

 

 

 

SCHEDULE 2

 

Schedule of Outstanding Notes

 

Promissory Note  Outstanding Principal   Outstanding Interest  David Loren
Corporation. 2% Secured Promissory Note issued May 1, 2011 to Hoboken Street
Associates, and as assigned to Warren Sheppard on July 3, 2013   22166    3,780 
David Loren Corporation. 2% Secured Promissory Note issued January 2, 2012 to
Hoboken Street Associates, and as assigned to Warren Sheppard on July 3, 2013 
 48,000    7,438  David Loren Corporation. 2% Secured Promissory Note issued
January 3, 2013 to Hoboken Street Associates, and as assigned to Warren Sheppard
on July 3, 2013   12,000    1,618  Kibush Capital Corp. 12.5% Secured Promissory
Note issued March 31, 2014 to Warren Sheppard.   157,500    104,815  Kibush
Capital Corp. 12.5% Secured Promissory Note issued June 30, 2014 to Warren
Sheppard.   110,741    70,384  Kibush Capital Corp. 12.5% Secured Promissory
Note issued September 30, 2014 to Warren Sheppard.   98,575    59,670  Kibush
Capital Corp. 12.5% Secured Promissory Note issued September 30, 2015 to Warren
Sheppard.   316,046    153,387  Kibush Capital Corp. 12.5% Secured Promissory
Note issued October 10, 2016 to Warren Sheppard.   155,300    37,272         
    Total:   920,328    438,364 

 

 

 

 

SCHEDULE 3

 

Schedule of Security Agreements

 

*** End Schedule 3 ***

 

 

 

 

EXHIBIT A

 

Form of Note

 

(attached hereto)