Document:

vhgi8kex101032714.htm

 

 

DEBT CONVERSTION AND GENERAL RELEASE AGREEMENT

 

THIS AGREEMENT is made and entered into this 27th day of March, 2014, by and between VHGI Holdings, Inc, (the “Company”) and ______________ (the “Note Holder”).

 

WHEREAS, the Note Holder is the holder of _______ dollars in principal debt (“Principal Debt”) of the Company. (please attach note)

 

WHEREAS, the Note Holder desires to immediately and upon execution of this Agreement convert such Principle Debt into common stock of VHGI Holdings, Inc. based on a price per share of One Cent ($0.01) and cancel any outstanding interest, penalties or any other monetary or legal obligation associated with such Principal Debt (“Debt Conversion”).

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained in this Agreement, and in order to consummate the Transfer, it is hereby agreed as follows:

 

1. Debt Conversion: Subject to the terms and conditions hereinafter set forth, at the date of this Agreement, (A) the Note Holder currently has verified (note attached) Principal Debt totaling _____________ (______________) and agrees to convert such Principal Debt into Common Stock of the Company at a price per share of One Cent ($0.01) for a total of _________________ common shares of the Company.  Simultaneous to such conversation, the Note Holder also agrees to cancel all associated documentation with such Principal Debt, including Interest, liens, security, penalties or any other monetary, legal or security feature of such Principal Debt.

 

2. Closing. The closing of the transactions contemplated by this Agreement ("Closing") shall be the date of the execution of this Agreement although, no later than April 4, 2014 4:00 PM EST at which time this offer will be cancelled and considered null and void if not signed prior to and delivered by, email (rick@lilygroup.com), or US mail with mail date stamped by April 3, 2014 delivered to: VHGI Holdings, Inc. attn. Rick Risinger 2017 S. Co. Rd. 50 W., Sullivan, Indiana 47882.

 

3. Closing Deliveries. In addition to and without limiting any other provisions of this Agreement, (A) the Company agrees to deliver, or make every attempt to cause to be delivered as soon as legally possible, to the Note Holder, a certificate(s) representing ________________ shares of Common Stock of the Corporation, and (B) the Note Holder agrees this document to be a full and complete release of the Principal Debt and any other associated obligation associated with such Principal Debt as paragraph 5 herein.

 

4. Representations and Warranties of the Note Holder and the Company.  Each party hereby represents and warrants that there has been no act or omission by such party which would give rise to any valid claim against any of the parties hereto for a brokerage commission, finder's fee, or other like payment in connection with the transactions contemplated hereby. There is herein additionally a potential for other creditors of company to make claim against company. Even though, the company has been audited the company makes no claim this is the final and total liability of the company and if, there are other creditors making claim this offer could be jeopardized by effect and cause of any such claim in the future. This is only an attempt to secure a balance sheet for company as to have further opportunity to succeed for future acquisitions that may or may not have been identified, negotiated or addressed.

 

 

  

  

  

 

5. General Release and Waiver

 

a. In exchange for the consideration provided for in Paragraph 1 and other valuable consideration, the Note Holder, for itself and for its successor and assigns (referred to collectively as “Releasors”), forever releases and discharges the Company and any and all of the Corporation’s past and/or present affiliates, officers, directors, members, agents, employees, employee benefit plans and their fiduciaries and administrators, and all of its successors and assigns (referred to collectively as the “Releasees”), of and from all causes of action, suits, debts, dues, liabilities, obligations, costs, expenses, liens, damages, judgments, claims and demands of any kind whatsoever, at law or in equity, known or unknown, which Releasors ever had, now have or may have against the Releasees  arising out of, by reason of, or relating in any way whatsoever to any matter, cause or thing from any time up to the Effective Date of this Agreement (each a “Claim”), including without limitation, any Claim arising out of the Principal Debt agreements or any associated agreements or claims thereof.

 

b. By virtue of the foregoing, the Company agrees, that it has waived any damages and other relief available to the Releasors (including, without limitation, monetary damages, equitable relief and reinstatement) with respect to any Claim.  Therefore, the Transferee agrees and covenants, for itself and each of the other Releasors, not to file any suit, charge or complaint against Releasees in any court or administrative agency, with regard to any Claim.

 

6. General Provisions

 

a. Entire Agreement. This Agreement (including the exhibits hereto and any written amendments hereof executed by the parties) constitutes the entire Agreement and supersedes all prior agreements and understandings, oral and written, between the parties hereto with respect to the subject matter hereof.

 

b. Third Parties. Except as disclosed in this Agreement, nothing in this Agreement, whether express or implied, is intended to confer any rights or remedies under or by reason of this Agreement on any persons other than the parties hereto and their respective administrators, executors, legal representatives, heirs, successors and assignees. Nothing in this Agreement is intended to relieve or discharge the obligation or liability of any third persons to any party to this Agreement, nor shall any provision give any third persons any right of subrogation or action over or against any party to this Agreement.

 

c. Other payables. Please note trade payables could also cause this proposed offer to be invalid. In the event the trade payables do not help facilitate the needs of this offer to be satisfied then this offer shall cancel on the date in paragraph 2 above.

 

d. Sections and Other Headings. The section and other headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.

 

e. Governing Law. This Agreement, and all transactions contemplated hereby, shall be governed by, construed and enforced in accordance with the laws of the State of Indiana.  The parties herein waive trial by jury and agree to submit to the personal jurisdiction and venue of a court of subject matter jurisdiction located in the State of Indiana.  In the event that litigation results from or arises out of this Agreement or the performance thereof, the parties agree to reimburse the prevailing party's reasonable attorney's fees, court costs, and all other expenses, whether or not taxable by the court as costs, in addition to any other relief to which the prevailing party may be entitled.

 

f. Counterparts. This Agreement may be executed in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement. A facsimile transmission or transmission via electronic mail (to rick@lilygroup.com) of a PDF version of this signed Agreement shall be legal and binding on all parties hereto.

 

g. Subject to:  This offer is only available and subject to the completion and fully execution of the 14C public filing and approval of an increase in the authorized shares of Company. It is also subject to ALL verified note holders identified herein attached accepting this offer. Without complete cooperation of all verified not holders, this action will cancel and no longer be available by the current administration. This offer is also subject to the ability to transfer the shares after the completion of the final 14C filing.

 

 

  

  

  

 

h. Disclaimer. We are not attempting to provide legal advice regarding any SEC or other Governmental agencies. Each Party shall be mindful of its obligations to secure knowledge of the absolute legal guidelines. The Company is also not providing any legal or tax advice to any Party of this agreement and each member shall consult their own respective representatives. Each Party may view the complete list of regulations and exemptions at www.SEC.gov.

 

 

IN WITNESS WHEREOF, this Agreement has been executed by each of the parties hereto on the date first above written.

 

	
Company

 

VHGI Holdings, Inc.

 

 

_____________________________

Name:          Rick Risinger

Title:           Chief Executive Officer

Date:           _______________________

 

 

 

 

 

 

	
Note Holder

 

___________________________

 

 

_____________________________

Name:         _______________________

Title:           _______________________

Date:           _______________________EXHIBIT 10.4

ROKWADER, INC.

(a
delaware corporation)

 

 

 

6%
Subordinated convertible Promissory Note

 

 

 

 

NEITHER THIS NOTE NOR THE SECURITIES
ISSUABLE UPON THE CONVERSION HEREOF AS PROVIDED HEREIN HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER
THE LAWS OF ANY STATE OR OTHER JURISDICTION. TRANSFER OF THIS NOTE AND SUCH SECURIITES IS RESTRICTED PURSUANT TO SUCH LAWS.

 

 

	$25,000.00	
        Calabasas, California

        January 31, 2014

 

 

 

	 	1.	Note. FOR VALUE RECEIVED, ROKWADER , INC. , a Delaware corporation (the “Company” or the “Borrower”), hereby promises to pay to the order of Brooktide LLC (the “Holder”) the amount of $25,000.00 on demand (“Due Date”) and to pay interest at the rate of six (6 %) per annum on the outstanding principal. Interest payments shall be made with principal on the due date, to the Holder in lawful money of the United States at, 123 West Nye Lane #510, Carson City, NV 89706, or at such other place as the Holder may specify in writing.

 

 

	 	2.	Default . In the event of an occurrence of any event of default specified below, the principal and all accrued interest on the Note shall become immediately due and payable without notice, except as specified below. The occurrence of any of the following events shall constitute an event of default under this Note:

 

	 	2.1	The Company fails to make any payment hereunder when due, which failure has not been cured within thirty (30) days following such failure.

 

	 	2.2	If the Borrower shall file a petition to take advantage of any insolvency act; make an assignment for the benefit of its creditors; commence a proceeding for the appointment of a receiver, trustee, liquidator or conservator of itself of a whole or any substantial part of its property; file a petition or answer seeking reorganization or arrangement or similar relief under the federal bankruptcy laws or any other applicable law or statute of the United States of America or any state; or

 

	 	2.3	If a court of competent jurisdiction shall enter an order, judgment or decree appointing a custodian, receiver, trustee, liquidator or conservator of the Borrower or of the whole or any substantial part of its properties, or approve a petition filed against the Borrower seeking reorganization or arrangement or similar relief under the federal bankruptcy laws or any other applicable law or statute of the United States of America or any state; or if, under the provisions of any other law for the relief or aid of debtors, a court of competent jurisdiction shall assume custody or control of the Borrower or of the whole or any substantial part of its properties; or if there is commenced against the Borrower any proceeding for any of the foregoing relief and such proceeding or petition remains undismissed for a period of thirty (30) days; or if the Borrower by any act indicates its consent to or approval of any such proceeding or petition; or
	 	2.4	If (i) any judgment remaining unpaid, unstayed or undismissed for a period of sixty (60) days is rendered against the Borrower which by itself or together with all other such judgments rendered against the Borrower remaining unpaid, unstayed or undismissed for a period of sixty (60) days, is in excess of $100,000, or (ii) there is any attachment or execution against the Borrower’s properties remaining unstayed or undismissed for a period of sixty (60) days which by itself or together with all other attachments and executions against the Borrower’s properties remaining unstayed or undismissed for a period of 60 days is for an amount in excess of $100,000.00.

 

 

 

	 	3.	Conversion – Holder

 

 

	 	3.1	Conversion Rights . At any time from the date hereof the Holder will have the right, at its option, to convert the Note into Shares of Common Stock of the Company (the “Shares”) at the conversion rate then in effect.

 

	 	 	The initial conversion rate is fifty cents ($0.50) per share or 50,000 Shares if the entire Note was converted, subject to adjustments in certain events. No fractional Share or scrip representing a fractional Share will be issued upon conversion of the Notes. Cash will be paid in lieu of any fractional Shares equal to the then current market value of such fractional Share.

 

	 	 	The conversion rate will be appropriately adjusted if the Company (a) pays a dividend or makes a distribution on its Shares of Common Stock which is paid or made in Shares of Common Stock, (b) subdivides or reclassifies its outstanding Shares of Common Stock, (c) combines its outstanding Shares of Common Stock into a smaller number of Shares of Common Stock, (d) issues Shares of Common Stock, or issues rights or warrants to all Holders of its Common Stock entitling them to subscribe for or purchase Shares of Common Stock (or securities convertible into Common Stock), at a price per Share less than $0.50 per Share, or (e) distributes to all Holders of its Common Stock evidences of its indebtedness or assets (excluding any dividend paid in cash out of legally available funds) subject to the limitation that adjustments by reason of any of the foregoing need not be made until they result in a cumulative change in the conversion rate of at least five percent (5%). The conversion rate will not be adjusted upon the conversion of presently outstanding stock options or warrants.

 

	 	 	In case of any consolidation or merger to which the Company is a party other than a merger or consolidation in which the Company is the surviving corporation, or in case of any sale or conveyance to another corporation of the property of the Company as an entirety or substantially as an entirety, or in case of any statutory exchange of securities with another corporation, there will be no adjustment of the conversion price, but each Holder of the Notes then outstanding will have the right thereafter to convert such Notes into the kind and amount of securities, cash or other property which he would have owned or have been entitled to receive immediately after such consolidation, merger, statutory exchange, sale or conveyance had such Notes been converted immediately prior to the effective date of such consolidation, merger, statutory exchange, sale or conveyance. In the case of a cash merger of the Company into another corporation or any other cash transaction of the type mentioned above, the effect of these provisions would be that the conversion features of the Notes would thereafter be limited to converting the Notes at the conversion price in effect at such time into the same amount of cash per Share that such Holder would have received had such Holder converted the Notes into Common Stock immediately prior to the effective date of such cash merger or transaction.

 

	 	3.2	Mechanics of Conversion .

 

	 	 	The Note may be converted upon a notice from the Company to the Note holder and surrender of the Notes at any time from the date hereof, at the offices of the Company, 23945 Calabasas Road, Suite 115, Calabasas, CA 91302, with the form of “Notice of Conversion” duly completed and executed as indicated. Shares of Common Stock issued upon conversion will be fully paid and non-assessable.

 

 

	 	4.	Prepayment. Borrower may prepay any or all amounts due under this Note at any time from the date of this Note at one hundred percent (100%) of the principal amount of the Note together with accrued interest; provided, however, that Borrower, as a condition to prepayment of some or all of the balance hereof, shall deliver written notice of its intention to prepay at least thirty (30) calendar days prior to the date of such prepayment (“Prepayment Date”).

 

	 	5.	Subordination. Indebtedness evidenced by the Note will be subordinated in right of payment to the prior payment in full of all existing and future Senior Indebtedness of the Company. Senior Indebtedness is defined as the principal of (and premium, if any) and unpaid interest or accrued original issue discount on and other amounts due on or in connection with any Debt (as defined below) incurred, assumed or guaranteed by the Company, whether outstanding on the date of the issuance of the Note or thereafter incurred, assumed or guaranteed and all renewals, extensions and refunding of any such Debt; provided, however, that the following will not constitute Senior Indebtedness:

 

	 	(i)	any Debt as to which, in the instrument creating or evidencing the same or pursuant to which the same is outstanding, it is expressly provided that such Debt is subordinate in right of payment to all other debt of the Company not expressly subordinated to such Debt;

 

	 	(ii)	any Debt which by its terms refers explicitly to the Note and states that such Debt shall not be senior in right of payment thereto;

 

	 	(iii)	any Debt of the Company in respect of the Note;

 

	 	(iv)	any Debt of the Company to any Subsidiary of the Company; and

 

	 	(v)	any Debt of the Company to any joint venture or partnership, which joint venture or partnership is required, under generally accepted accounting principles, to be consolidated in the Company’s consolidated financial statements.

 

	 	 	Debt is defined to mean, with respect to any person at any date, without duplication:

 

	 	(i)	all obligations of such person for borrowed money,

 

	 	(ii)	all obligations of such person evidenced by bonds, debentures, note or other similar instruments,

 

	 	(iii)	all Debt of others secured by a lien on any asset of such person, whether or not such Debt is assumed by such person,

 

	 	(iv)	all Debt of others for the payment, of which such person is responsible or liable as obligor or guarantor,

 

	 	(v)	all obligations of such person in respect of letters of credit or other similar instruments (or reimbursement obligations with respect thereto),

 

	 	(vi)	all obligations of such person to pay the deferred purchase price of property or services, except Trade Payables, and

 

	 	(vii)	all reimbursement, reserve funding and other obligations of such person in respect of surety bonds executed by such person or at the request of and for the benefit of such person.

 

 

 

By reason of such subordination,
in the event of dissolution, insolvency, bankruptcy or other similar proceedings, upon any distribution of assets, (i) holders
of Senior Indebtedness will be entitled to be paid in full before payments may be made on the Note, and the Holder of the Note
will be required to pay over their share of such distribution to the holder of Senior Indebtedness until such Senior Indebtedness
is paid in full and (ii) creditors of the Company who are neither holders of Notes nor holders of Senior Indebtedness may
recover less, ratably, than holders of Senior Indebtedness and may recover more, ratably, than the Holder of the Note.

 

	 	6.	Securities Law Compliance. The Holder understands that the right of conversion of this Note is subject to full compliance with the provisions of all applicable securities laws and the availability thereunder upon any conversion of any exemption from registration thereunder for such conversion, and that the certificate or certificates evidencing such Note will bear a legend to the following effect:

 

“THE
SECURITIES EVIDENCED HEREBY MAY NOT BE TRANSFERRED WITHOUT (i) THE OPINION OF COUNSEL SATISFACTORY TO THIS CORPORATION THAT
SUCH TRANSFER MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE FEDERAL SECURITIES ACT OF 1933, AS AMENDED, OR (ii) SUCH
REGISTRATION.”

 

	 	7.	Notices. Any notice herein required or permitted to be given shall be in writing and may be personally served, sent by United States Mail, certified, or by overnight delivery service. For the purposes hereof, the address of the Holder and the address of the Company shall be as reflected in the Subscription Agreement between the Holder and the Company of even date herewith. Both the Holder and the Company may change the address for service by written notice to the other as herein provided.

 

	 	8.	No Waiver Rights and Remedies Cumulative. No failure on the part of the Holder to exercise, and no delay in exercising any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by the Holder of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The rights and remedies herein provided are cumulative and not exclusive of any remedies or rights provided by law or by any other agreement between the Borrower and the Holder.

 

	 	9.	Amendments. No amendment, modification or waiver of any provision of this Note nor consent to any departure by the Holder therefrom shall be effective unless the same shall be in writing and signed by the Holder and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.

 

	 	10.	Successors and Assigns. This Note shall be binding upon the Borrower and its successors and assigns and the terms hereof shall inure to the benefit of the Holder and its successors and assigns, including subsequent holders hereof.

 

	 	11.	Severability. The provisions of this Note are severable, and if any provision shall be held invalid or unenforceable in whole or in part in any jurisdiction, then such invalidity or unenforceability shall not in any manner affect such provision in any other jurisdiction or any other provision of this Note in any jurisdiction.

 

	 	12.	Waiver of Notice. The Borrower hereby waives presentment, demand for payment, notice of protest and all other demands in connection with the delivery, acceptance, performance, default or enforcement of this Note.

 

	 	13.	Governing Law. This Note has been executed in and shall be governed by the laws of the State of California.

 

 

	 	14.	Note Holder is Not a Shareholder. No Holder of this Note, solely by virtue of the ownership of this Note, shall be considered a shareholder of the Company for any purpose, nor shall anything in this Note be construed to confer on any Holder of this Note any rights of a shareholder of the Company including, without limitation, any right to vote, give or withhold consent to any corporate action, receive notice of meetings of shareholders or receive dividends.

 

	 	15.	Exchange and Replacement of Note. Upon surrender of this Note to the Borrower, the Borrower shall execute and deliver, at its expense, one or more new Notes of such denominations and in such names, as requested by the holder of the surrendered Note. Upon receipt of evidence satisfactory to the Company of the loss, theft, mutilation, or destruction of any Note, the Borrower will make and deliver a new Note of like tenor at the request of the holder of such Note.

 

 

IN WITNESS WHEREOF,
the Company has caused this Note to be signed by its authorized officers as of the 31st day of January, 2014.

 

 

	 	 	
        ROKWADER, INC.

         

	
         

         

         
	 	
         

        By: /s/ Gary Saderup 

        Gary Saderup, Secretary

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