exv10w37






Exhibit 10.37



THIS AMENDED AND RESTATED DEBENTURE AND THE SECURITIES INTO WHICH IT IS CONVERTIBLE
(COLLECTIVELY, THE “SECURITIES”), HAVE NOT BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE. THE SECURITIES ARE BEING OFFERED
PURSUANT TO A SAFE HARBOR FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”). THE SECURITIES ARE “RESTRICTED” AND MAY NOT BE OFFERED OR SOLD UNLESS THE SECURITIES ARE
REGISTERED UNDER THE ACT, OR ELIGIBLE TO BE OFFERED OR SOLD PURSUANT TO AVAILABLE EXEMPTIONS FROM
THE REGISTRATION REQUIREMENTS OF THE ACT AND THE COMPANY WILL BE PROVIDED WITH AN OPINION OF
COUNSEL, IN FORM REASONABLY ACCEPTABLE TO COMPANY COUNSEL, CONFIRMING THAT SUCH EXEMPTIONS ARE
AVAILABLE.




IMPERIAL HOLDINGS, LLC.

Amended and Restated Unsecured Convertible Debenture

November 1, 2010




US $30,000,000



This Amended and Restated Unsecured Convertible Debenture (the “Debenture”) is issued as of
November 1, 2010 (the “Closing Date”) by Imperial Holdings, LLC, a Florida limited liability
company (the “Company”), to Branch Office of Skarbonka Sp. z o. o., 58, rue Charles Martel, L-2134
Luxembourg, as holder and agent of Jasmund Ltd. and Premium Funding, Inc. (together with its
permitted successors and assigns, the “Holder”) pursuant to exemptions from registration under the
Securities Act of 1933, as amended.




ARTICLE I.




     Section 1.01 Principal and Interest. For value received, the Company hereby promises to pay
to the order of the Holder on October 4, 2011 (the “Maturity Date”) in lawful money of the United
States of America and in immediately available funds, the principal sum of Thirty Million U.S.
Dollars (US $30,000,000) together with interest on the unpaid principal of this Debenture at the
rate of zero percent (0%) per annum (the “Interest Rate”) from the date hereof until paid;
provided, that, if the unpaid principal of the Debenture is not either (a) paid in full on or prior
to the Maturity Date or (b) converted into Common Stock (as hereinafter defined) prior to the
Maturity Date pursuant to the provisions hereinafter provided, then the Interest Rate shall be
sixteen percent (16%) per annum in lieu of the rate set forth above, applicable and effective from
the date this Debenture was originally issued.



     Section 1.02 Mandatory Conversion. This Debenture shall automatically be converted into
Common Stock on the terms set forth herein immediately prior to the achievement of an IPO for the
Company. “IPO” shall mean an initial, underwritten public offering of Common Stock pursuant to an
effective registration statement under the Securities Act of 1933, as amended. Upon such
conversion, the principal amount of the Debenture, plus accrued and unpaid interest, shall be
converted into 1,272,727 (One Million Two Hundred Seventy Two Thousand Seven



 









 




Hundred and Twenty Seven) shares (the “Conversion Shares”) of the Company’s common stock
(“Common Stock”) created in the Reorganization (as hereinafter defined).




     Section 1.03 Reservation of Common Stock. The Company, following the Reorganization, shall
reserve and keep available out of its authorized but unissued shares of Common Stock, solely for
the purpose of effecting the conversion of this Debenture, such number of shares of Common Stock as
shall from time to time be sufficient to effect such conversion. If at any time the Company does
not have a sufficient number of Conversion Shares authorized and available, the Company shall take
such action as is required to increase the number of Conversion Shares authorized and available so
that a sufficient number shall be authorized and available to permit a full conversion of this
Debenture.



     Section 1.04 Mechanics of Conversion.



          (1) Delivery of Certificate Upon Conversion. Not later than ten (10) business days after the
conversion date (the “Share Delivery Date”), the Company shall deliver, or cause to be delivered,
to the Holder a certificate or certificates representing the Conversion Shares representing the
number of Conversion Shares being acquired upon the conversion of this Debenture.




          (2) Obligation Absolute. The Company’s obligations to issue and deliver the Conversion Shares
upon conversion of this Debenture in accordance with the terms hereof, and the Holder’s obligation
to convert the Debenture into Conversion Shares, are absolute and unconditional, irrespective of
any action or inaction by the Holder or the Company to enforce the same or any waiver or consent
with respect to any provision hereof.




          (3) Transfer Taxes. The issuance of certificates for shares of the Common Stock on conversion
of this Debenture shall be made without charge to the Holder hereof for any documentary stamp or
similar taxes that may be payable in respect of the issue or delivery of such certificates,
provided that the Company shall not be required to pay any tax that may be payable in respect of
any transfer involved in the issuance and delivery of any such certificate upon conversion in a
name other than that of the Holder of this Debenture and the Company shall not be required to issue
or deliver such certificates unless or until the person or persons requesting the issuance thereof
shall have paid to the Company the amount of such tax or shall have established to the satisfaction
of the Company that such tax has been paid.




     Section 1.05 Conversion from LLC to State Law Corporation. It is contemplated that
immediately prior to an IPO, that the Company shall reorganize into a state law corporation whether
by conversion, merger or otherwise, in order to undertake an IPO (the “Reorganization”). The
Holder hereunder recognizes and acknowledges that the Common Stock shall not be created until after
the Reorganization is consummated and then only immediately prior to the achievement of an IPO of
the Company. The Company covenants and agrees that the Reorganization shall occur prior to an IPO.



ARTICLE II.




     Section 2.01 Amendments and Waiver of Default. The Debenture may not be amended without the
consent of the parties hereto.



ARTICLE III.




     Section 3.01 Events of Default. An Event of Default is defined as follows: (a) failure by the
Company to pay amounts due hereunder within ten (10) days of the date any such amounts



 









 




are due; (b) failure by the Company for ten (10) days after notice to it to comply with any of
its other agreements in the Debenture; (c) the sale of all or substantially all of the equity of
the Company or all or substantially all of the assets of the Company; or (d) any event of
bankruptcy or insolvency by the Company. Upon the occurrence of an Event of Default, the interest
on this Debenture shall immediately accrue at an interest rate equal to the lesser of sixteen
percent (16%) per annum or the maximum rate permitted by applicable law, and, in addition to all
other rights or remedies the Holder may have, at law or in equity, the Holder may, in its sole
discretion, accelerate full repayment of all debentures outstanding and accrued interest thereon.
In connection with the Holder’s rights hereunder upon an Event of Default, the Holder need not
provide, and the Company hereby waives, any presentment, demand, protest or other notice of any
kind, and the Holder may immediately enforce any and all of its rights and remedies hereunder and
all other remedies available to it in equity or under applicable law.




ARTICLE IV.




     Section 4.01 Holder Not Deemed a Stockholder. Except as otherwise specifically provided
herein, no holder, as such, of this Debenture shall be entitled to vote or receive dividends or be
deemed the holder of shares of capital stock of the Company for any purpose, nor shall anything
contained in this Debenture be construed to confer upon the Holder, as such, any of the rights of a
stockholder of the Company or any right to vote, give or withhold consent to any corporate action
(whether any reorganization, issue of stock, reclassification of stock, consolidation, merger,
conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or
otherwise, prior to the issuance to the Holder of the Conversion Shares which he or she is then
entitled to receive upon the conversion of this Debenture. Notwithstanding this Section 4.01, the
Company will provide the Holder with copies of the same notices and other information given to the
stockholders of the Company generally, contemporaneously with the giving thereof to the
stockholders.



ARTICLE V.




     Section 5.01 Notice. Any notices, consents, waivers or other communications required or
permitted to be given under the terms of this Debenture must be in writing and will be deemed to
have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by
facsimile (provided confirmation of receipt is received by the sending party, transmission is
mechanically or electronically generated and kept on file by the sending party); or (iii) one
business day after deposit with a nationally recognized overnight delivery service, in each case
properly addressed to the party to receive the same. The addresses and facsimile numbers for such
communications shall be:


If to the Company, to:




Imperial Holdings, LLC

701 Park of Commerce Blvd., Ste. 301

Boca Raton, FL 33487

Attn: Antony Mitchell

Facsimile: 561.892.6313



If to the Holder:




Branch Office of Skarbonka sp. z o. o.




 









 





Attn.: Toni Portley

58, rue Charles Martel

L-2134 Luxembourg

Facsimile: +352 (26) 73 88 94



Each party shall provide five days’ prior written notice to the other party of any change in
address or facsimile number. Written confirmation of receipt (A) given by the recipient of such
notice, consent, facsimile, waiver or other communication, or (B) provided by a nationally
recognized overnight delivery service shall be rebuttable evidence of personal service, receipt by
facsimile or receipt from a nationally recognized overnight delivery service in accordance with
clause (i), (ii) or (iii) above, respectively.




     Section 5.02 Governing Law. This Debenture shall be deemed to be made under and shall be
construed in accordance with the laws of the State of Florida without giving effect to the
principals of conflict of laws thereof. Each of the parties consents to the jurisdiction of the
U.S. District Court sitting in the Southern District of the State of Florida or the state courts of
the State of Florida sitting in Palm Beach County, Florida in connection with any dispute arising
under this Debenture and hereby waives, to the maximum extent permitted by law, any objection,
including any objection based on forum non conveniens to the bringing of any such proceeding in
such jurisdictions.



     Section 5.03 Compliance with Securities Laws on Transfer. This Debenture and the shares of
Common Stock underlying this Debenture (collectively, the “Securities”) may not be transferred or
assigned in whole or in part without compliance with applicable federal and state securities laws
by the transferor and the transferee (including, without limitation, the delivery of investment
representation letters and legal opinions reasonably satisfactory to the Company).



     Section 5.04 Severability. The invalidity of any of the provisions of this Debenture shall not
invalidate or otherwise affect any of the other provisions of this Debenture, which shall remain in
full force and effect.



     Section 5.05 Entire Agreement and Amendments. This Debenture represents the entire agreement
between the parties hereto with respect to the subject matter hereof and thereof, and there are no
representations, warranties or commitments, except as set forth herein and therein. This Debenture
may be amended only by an instrument in writing executed by the parties hereto.



     Section 5.06 Counterparts. This Debenture may be executed in multiple counterparts, each of
which shall be an original, but all of which shall be deemed to constitute on instrument.



     Section 5.07 Lost or Mutilated Debenture. If this Debenture shall be mutilated, lost, stolen
or destroyed, the Company shall execute and deliver, in exchange and substitution for and upon
cancellation of a mutilated Debenture, or in lieu of or in substitution for a lost, stolen or
destroyed Debenture, a new Debenture for the principal amount of this Debenture so mutilated, lost,
stolen or destroyed, but only upon receipt of evidence of such loss, theft or destruction of such
Debenture, and of the ownership hereof, reasonably satisfactory to the Company.



     Section 5.08 Principal and interest under this Debenture are payable only to the registered
holder of this Debenture. The initial holder is the Holder. If the Debenture is to be transferred
by the holder, the holder shall surrender the Debenture to the Company, together with written
instructions directing the Company to reissue the Debenture to the transferee. The



 









 




Company shall then record the identity of the transferee in its books and reissue the
Debenture to the transferee. Any transfer of this Debenture that is not made in conformity with
the foregoing procedures shall not be valid and shall not be recognized by the Company.




     Section 5.09 The Holder or any subsequent holder agrees that the holder shall submit a
certificate to the Company on a periodic basis certifying, under penalties of perjury, that the
beneficial owner is not a U.S. person, or in the case of an individual, that the holder is not a
citizen or resident of the United States, and setting forth the name and address of the beneficial
owner. Said certification shall be made on forms prescribed by the United States Internal Revenue
Service for this purpose (presently, Form W-8BEN). If the information on the foregoing
certification changes, the beneficial owner hereof shall so inform the maker within five (5)
business days.



     Section 5.10 This Debenture amends and restates and replaces the original debenture (the
“Original Debenture”) in the amount of $30,000,000 executed by the Company in favor of Branch
Office of Skarbonka Sp. z o. o on November 1, 2010.



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     IN WITNESS WHEREOF, with the intent to be legally bound hereby, the Company has executed this
Amended and Restated Debenture as of the date first written above.



	 	 	 	 	 
	 	IMPERIAL HOLDINGS, LLC

 	 
	 	By:  	/s/ Antony Mitchell
 	 
	 	 	Name:  	Antony Mitchell 	 
	 	 	Title:  	Chief Executive Officer