Document:

Unassociated Document

    THIS
      SUBORDINATED NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
      AS
      AMENDED (THE “ACT”), OR APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD,
      TRANSFERRED, OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
      RECEIPT BY BOO KOO HOLDINGS, INC. (THE “COMPANY”) OF A WRITTEN OPINION OF
      COUNSEL IN THE FORM, SUBSTANCE AND SCOPE REASONABLY SATISFACTORY TO THE COMPANY
      THAT THIS SUBORDINATED NOTE MAY BE SOLD, TRANSFERRED, OR OTHERWISE DISPOSED
      OF,
      UNDER AN EXEMPTION FROM REGISTRATION UNDER THE ACT AND SUCH STATE SECURITIES
      LAWS. 

     

    THE
      RIGHTS AND OBLIGATIONS EVIDENCED BY THIS SUBORDINATED NOTE ARE SUBORDINATED
      AND
      SUBJECT TO THE RIGHTS OF THE SENIOR CREDITOR IDENTIFIED HEREIN, PURSUANT TO
      THE
      TERMS AND CONDITIONS CONTAINED HEREIN. THE HOLDER AND ANY SUBSEQUENT HOLDERS
      OF
      THIS SUBORDINATED NOTE, BY THEIR ACCEPTANCE HEREOF, SHALL BE BOUND BY THE
      SUBORDINATION PROVISIONS CONTAINED HEREIN.

     

    BOO
      KOO HOLDINGS, INC.

     

    Subordinated
      Note

     

    
      	Date: _____ __, 2008	
              $__________

            

    

    

    FOR
      VALUE
      RECEIVED,
      the
      undersigned, BOO KOO HOLDINGS, INC., a Delaware corporation (the “Maker” or the
“Company”), promises to pay to the order of ________________, (together with his
      successors and permitted assigns, the “Holder”) at the offices of the Holder
      located at _________________________________, or at such other place as the
      Holder may designate in writing to the Company, in lawful money of the United
      States of America, and in immediately available funds, the principal sum of
      _______________________($_________). In
      addition to such other terms as are elsewhere defined herein, as used in this
      Subordinated Note capitalized terms shall have the meanings ascribed to such
      terms in Section 12 hereof.

    

    1.
      Interest and Payments. 

    

    (a) Interest.
      Interest shall accrue on the aggregate principal balance of all loans from
      time
      to time outstanding hereunder from the date hereof until paid in full at a
      per
      annum rate equal to fifteen per cent per annum (15%) in simple interest
      terms.

    

    (b) Payments.
      Unless
      due earlier pursuant to the terms hereof, all outstanding principal and all
      accrued interest shall be payable on December 31, 2008. Such payment shall
      be
      applied first, to accrued interest and any fees or expenses due hereunder,
      and
      then to the principal balance. Accrued interest shall also be due and payable
      on
      any other date on which the principal balance is due (whether by acceleration,
      maturity or otherwise).

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    (c) Prepayments.
      Subject
      to Section 4 hereof, the Company
      may prepay this Subordinated Note in full or in part, without
      penalty.

    

    (d) Default
      Interest.
      Interest shall accrue on any amount past due hereunder at a rate equal to Three
      Percent (3.0%) per annum in excess of the interest rate otherwise payable
      hereunder. All such interest shall be due and payable on demand.

    

    (e) Maximum
      Rate.
      

    

    (i)
       In
      no
      event shall the amount of interest due or payable under this Subordinated Note
      exceed the maximum rate of interest allowed by applicable law and, in the event
      any such payment is inadvertently paid by the Company or inadvertently received
      by the Holder, then such excess sum shall be credited as a payment of principal,
      unless the Company shall notify the Holder in writing that the Company elects
      to
      have such excess sum returned to it forthwith. It is the express intent of
      the
      parties hereto that the Company not pay and the Holder not receive, directly
      or
      indirectly, in any manner whatsoever, interest in excess of that which may
      be
      lawfully paid by the Company under applicable law.

    

    (ii)
       The
      Company, and the Holder by accepting this Subordinated Note, each agree and
      stipulate that the only charge imposed upon the Company for the use of money
      in
      connection with this Subordinated Note is and shall be the interest described
      in
      the first paragraph hereof, and further agree and stipulate that other charges
      imposed by the Holder on the Company in connection with this Subordinated Note
      are charges made to compensate the Holder for underwriting or administrative
      services and costs or losses performed or incurred and to be performed or
      incurred, by the Holder in connection with this Subordinated Note and shall
      under no circumstances be deemed to be charges for the use of money pursuant
      to
      the applicable provisions of Texas law. All charges other than charges for
      the
      use of money shall be fully earned and nonrefundable when due.

    

    2.
      Events
      of Default and Remedies. 

    

    (a)
       Events
      of Default.
      Each of
      the following events shall constitute an “Event of Default” under this
      Subordinated Note: (i) failure of the Company to pay any principal,
      interest or other amount due hereunder within 10 Business Days of the date
      such
      payment is due, or the Company shall in any way fail to comply with the other
      terms, covenants or conditions contained in this Subordinated Note;
      (ii) any written representation or warranty made at any time by the Company
      to the Holder shall prove to have been incorrect or misleading in any material
      respect when made; (iii) the Company shall (a) commence a voluntary
      case under the Bankruptcy Code or other bankruptcy law, domestic or foreign,
      relating to bankruptcy, insolvency, reorganization, winding up or composition
      for adjustment of debts (as now or hereafter in effect); (b) file a
      petition seeking to take advantage of any other laws, domestic or foreign,
      relating to bankruptcy, insolvency, reorganization, winding up or composition
      for adjustment of debts; (c) consent to or fail to contest in a timely and
      appropriate manner any petition filed against it in an involuntary case under
      such bankruptcy laws or other laws; (d) apply for or consent to, or fail to
      contest in a timely and appropriate manner, the appointment of, or the taking
      of
      possession by, a receiver, custodian, trustee, or liquidator of itself or of
      a
      substantial part of its property, domestic or foreign; (e) be unable to, or
      admit in writing its inability to, pay its debts as they become due;
      (f) make a general assignment for the benefit of creditors; or
      (g) make a conveyance fraudulent as to creditors under any state or federal
      law; or (iv) a case or other proceeding shall be commenced against the
      Company in any court of competent jurisdiction seeking (a) relief under the
      Bankruptcy Code or other federal bankruptcy law (as now or hereafter in effect)
      or under any other laws, domestic or foreign, relating to bankruptcy,
      insolvency, reorganization, winding up or adjustment of debts or (b) the
      appointment of a trustee, receiver, custodian, liquidator or the like for the
      Company or all or any substantial part of the assets, domestic or foreign,
      of
      the Company and such suit shall fail to be discharged within 90
      days.

     

    
      
        
        

      

      
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    (b) Remedies.
      Subject
      to Section 4 hereof, upon the occurrence of an Event of Default (other than
      one
      described in clause (iii) or (iv) of the definition thereof), any and all
      of the loans and the Company’s other obligations hereunder, may be immediately
      declared to be due and payable in full, and thereupon the Holder may exercise
      any and all rights and remedies available to it at law. Upon the occurrence
      of
      an Event of Default described in clause (iii) or (iv) of the definition
      thereof, any and all of the loans and the Company’s other obligations hereunder
      shall immediately be due and payable in full, without any further action on
      the
      part of the Holder, and the Holder may exercise any and all rights and remedies
      available to it at law, in equity or otherwise.

    

    3.
      Expenses.
      The
      Company shall pay all expenses incurred by the Holder in the collection of
      this
      Subordinated Note, including, without limitation, reasonable attorneys’ fees, if
      this Subordinated Note is collected by or through an
      attorney-at-law.

    

    4.
      Subordination
      of Subordinated Debt.

     

    (a) Subordination
      of Subordinated Debt.
      The
      Company, for itself and its successors and assigns, and the Holder by his
      acceptance of this Subordinated Note, agree that the payment of the Subordinated
      Debt by the Company is subordinated, to the extent and in the manner provided
      in
      this Section 4, to the indefeasible payment in full of all Senior Debt and
      the
      termination of the Senior Note, and the Company shall not make and the Holder
      shall not accept or receive any payment of the Subordinated Debt in
      contravention of the provisions of this Section 4, including, but not limited
      to, any interest payments upon the occurrence and during the continuance of
      an
“Event of Default” (as defined in the Senior Note).
      

     

    (b) Holder
      Acknowledgment.
      Holder
      agrees and acknowledges (i) the provisions hereof are, and are intended to
      be,
      an inducement to and in consideration of the Senior Creditor, to acquire and
      hold, or to continue to hold, the Senior Debt, and the Senior Creditor shall
      be
      deemed conclusively to have relied on such subordination provisions in acquiring
      and holding, or in continuing to hold, the Senior Debt and the provisions hereof
      shall be enforceable against Holder by the Senior Creditor. 

     

    (c) Subordination
      on Dissolution, Liquidation or Reorganization.
      

     

    (i) Upon
      any
      distribution of assets of the Company or any of its subsidiaries in any
      Insolvency Proceeding (other than in connection with a reorganization or
      readjustment of the Company, in which case clause (ii) will apply):

     

    (A) the
      Senior Creditor shall first be entitled to receive the indefeasible payment
      in
      full of the principal of and interest due on the Senior Debt and the Senior
      Note
      shall be terminated, before the Holder is entitled to receive any payment from
      the Company of principal on this Subordinated Note; and

     

    (B) any
      payment or distribution of assets of the Company of any kind or character,
      whether in cash, property or securities, to which the Holder would be entitled
      except for the provisions of this Section 4, shall be paid by the liquidating
      trustee or agent or other Person making such payment or distribution directly
      to
      the Senior Creditor to the extent necessary to make payment in full of the
      Senior Debt remaining unpaid.

     

    
      
        
        

      

      
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    (ii) In
      any
      case or proceeding for the reorganization or readjustment of debts of the
      Company (whether in bankruptcy, receivership or similar proceeding relating
      to
      the Company or its property), any payment or distribution of assets of the
      Company of any kind or character, whether in cash or other property, to which
      the Holder is entitled pursuant to a plan of reorganization or debt adjustment
      shall be paid by the liquidating trustee or other Person making such payment
      or
      distribution directly to the Senior Creditor until payment in full of all Senior
      Debt.

     

    (iii) The
      Senior Creditor is hereby irrevocably authorized and empowered (in its own
      name
      or in the name of Holder or otherwise), but shall have no obligation, to file
      claims and proofs of claim and to vote such claims in any Insolvency Proceeding;
      provided that the Senior Creditor shall not have any obligation to execute,
      verify, deliver or file any such proof of claim or vote such claim. In the
      event
      that the Senior Creditor votes any claim in accordance with the authority
      granted hereby, the Holder shall not be entitled to change or withdraw such
      vote.

     

    (d) Specific
      Performance.
      The
      Senior Creditor is hereby authorized to demand specific performance of the
      provisions of this Section 4 whether or not the Company shall have complied
      with
      any of the provisions hereof that are applicable to it, at any time that the
      Holder shall have failed to comply with any of the provisions of this Section
      4
      applicable to it. The Holder hereby irrevocably waives any defense based on
      the
      adequacy of a remedy at law that might be asserted as a bar to such remedy
      of
      specific performance.

     

    (e) Subordination
      Rights Unimpaired.
      No
      right of any present or future holders of Senior Debt to enforce subordination
      as provided herein shall at any time be prejudiced or impaired by any act or
      failure to act on the part of the Company or by any act or failure to act by
      any
      such holder, or by any noncompliance by the Company with the terms of this
      Subordinated Note, regardless of any knowledge thereof which any holder may
      have
      or otherwise be charged with. No provision in any supplemental document that
      purports to affect the superior position of the Senior Creditor will be
      effective against the Senior Creditor who has not consented thereto in writing.
      Additionally, the Senior Debt shall continue to be treated as Senior Debt and
      the provisions hereof shall continue to govern the relative rights and
      priorities of the Senior Creditor and the Holder even if all or part of the
      Senior Debt or the security interests securing the Senior Debt are subordinated,
      set aside, avoided or disallowed in connection with any such Insolvency
      Proceeding and the provisions hereof shall be reinstated if at any time any
      payment of the Senior Debt is rescinded or must otherwise be returned by the
      Senior Creditor or its agent, designee or nominee.

     

    
      
        
        

      

      
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    (f) Subordinated
      Debt Default.
      The
      failure to make a payment on account of the Subordinated Debt by reason of
      any
      provision of this Section 4 shall not be construed to prevent the occurrence
      of
      an Event of Default hereunder; provided, however, that the failure to make
      a
      payment on account of the Subordinated Debt by reason of the provisions of
      this
      Section 4 shall not be deemed to be a default or an event of default under,
      or
      entitle the Holder to additional rights under, or result in the incurrence
      of
      additional obligations on the part of the Company under, any other agreement
      between the Holder and the Company.

    (g) Turnover
      of Prohibited Payments.
      If any
      payment or distribution of any character, whether in cash or other properties
      or
      through the exercise of a set-off, shall be received (actually or
      constructively) by the Holder in contravention of any of the terms of this
      Section 4, such payment or distribution shall be received by the Holder, in
      trust for the benefit of, and shall be paid or delivered and transferred to,
      the
      Senior Creditor, or to a trustee or agent for the benefit of the Senior
      Creditor, for application to the payment of all Senior Debt remaining unpaid,
      to
      the extent necessary to effect payment in full of the Senior Debt after giving
      effect to any concurrent payment or distributions to the Senior Creditor. In
      connection with any payment or distribution of cash or property of the Company
      in any Insolvency Proceeding, the Holder shall be entitled to rely upon any
      order or decree made by any court of competent jurisdiction in which such
      Insolvency Proceeding is pending, or a certificate of the liquidating trustee
      or
      agent or other Person making such payment or distribution, delivered to the
      Holder, for the purpose of ascertaining the Person or Persons entitled to
      receive payment from the Holder pursuant to the foregoing provisions of this
      subsection, the amount thereof or payable thereon, the amount or amounts paid
      or
      distributed thereon and all of the facts pertinent thereto or to this Section
      4.

     

    (h) Enforcement
      of Subordinated Debt.
      Until
      the Senior Debt shall be indefeasibly paid in full and the Senior Note has
      been
      terminated, and except as otherwise permitted under Section 4(c)(i) and
      4(c)(ii), the Holder shall not (i) accelerate the maturity of or otherwise
      declare due and payable any of the Subordinated Debt prior to when this
      Subordinated Note is otherwise payable in accordance herewith, (ii) commence
      or
      join with any other creditor in commencing an Insolvency Proceeding, or (iii)
      continue or take any other action to collect or enforce any right to receive
      any
      payment on account of the Subordinated Debt, including, but not limited to,
      the
      exercise of any other right or remedy under this Subordinated Note or otherwise
      at law or in equity that Holder might otherwise possess, to collect any amount
      due and payable in respect of this Subordinated Note. Notwithstanding the
      foregoing, Holder may file a proof of claim in any bankruptcy or similar
      proceeding instituted by another entity and may vote such claim in a manner
      not
      inconsistent with the terms hereof. In the event the Company does not make
      any
      payment required to be made by it, any such non-payment shall not limit or
      affect the Holders or his affiliates’ obligations under any employment,
      non-compete or similar agreement or covenant, it being agreed that such other
      agreements and covenants are independent of any provision hereof and the
      existence of any claim or cause of action hereunder shall not constitute a
      defense to the enforcement by the Company of such other agreements and
      covenants. If Holder shall attempt to enforce, collect or realize upon any
      of
      the Subordinated Debt in violation of the terms hereof, the Senior Creditor
      may,
      by virtue of the terms hereof, restrain any such enforcement, collection or
      realization, either in its own name or in the name of the
      Company.

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    (i) Reinstatement.
      The
      provisions of this Section 4 shall continue to be effective or be reinstated,
      as
      the case may be, if at any time any payment in respect of the Senior Debt is
      rescinded or must other be returned by the holder thereof upon the filing by
      or
      against the Company of any Insolvency Proceeding, all as if such payment had
      never been made.

     

    (j) Subordinated
      Note Unsecured.
      The
      rights and obligations evidenced by this Subordinated Note are unsecured.
      Company shall not grant or convey any security interest or security title in
      or
      to any real or personal property to secure the obligations evidenced by this
      Subordinated Note, and Holder shall not receive, accept or accept the benefits
      of any such security interest or security title.

     

    (k) Modification
      of Senior Debt.
      The
      Senior Creditor may, at any time, in their discretion, renew, amend, refinance,
      extend or otherwise modify the terms and provisions of Senior Note so held
      (including, without limitation, the terms and provisions relating to the
      principal amount outstanding thereunder, the rate of interest thereof, the
      payment terms thereof and the provisions thereof regarding default or any other
      matter) or exercise (or refrain from exercising) any of their rights under
      the
      Senior Debt, all without notice to or consent from the Holder. No compromise,
      alteration, amendment, renewal, restatement, refinancing or other change of,
      or
      waiver, consent or other action in respect of any liability or obligation under
      or in respect of, any terms, covenants or conditions of Senior Debt or any
      documentation executed or delivered in connection with Senior Debt, whether
      or
      not in accordance with the provisions of the Senior Debt, shall in any way
      alter
      or affect any of the subordination provisions hereof.

    

    (l) No
      Contest.
      Holder
      covenants and agrees that it will not, and will not encourage any other Person
      to, at any time, contest the validity, perfection, priority or enforceability
      of
      the provisions hereof, the Senior Debt, the Senior Note, any agreements or
      documents executed or delivered in connection with any of the foregoing or
      the
      security interests or liens granted pursuant thereto.

    

    5.
      Waiver
      of Jury Trial. THE COMPANY, AND THE HOLDER BY ACCEPTING THIS NOTE, EACH
      ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN THE COMPANY AND THE HOLDER
      WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT. ACCORDINGLY,
      THE
      HOLDER AND THE COMPANY HEREBY WAIVE TRIAL BY JURY IN ANY ACTION OR PROCEEDING
      OF
      ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY BE COMMENCED
      BY OR AGAINST THE COMPANY ARISING OUT OF THIS NOTE OR BY REASON OF ANY OTHER
      CAUSE OR DISPUTE WHATSOEVER BETWEEN THE COMPANY AND THE HOLDER OF ANY KIND
      OR
      NATURE.

    

    6.
      Time.
 Time
      is
      of the essence of this Subordinated Note.

    

    7.
      Amendments and Waivers. All amendments to this Subordinated Note, and any waiver
      or consent of the Holder, must be in writing and signed by the Holder and the
      Company. No delay or failure on the part of the Holder in the exercise of any
      right or remedy shall operate as a waiver thereof, and no single or partial
      exercise by the Holder of any right or remedy shall preclude other or further
      exercise thereof or the exercise of any other right or remedy.

     

    
      
        
        

      

      
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      8.
        Waiver. The Company hereby waives presentment, demand, notice of dishonor,
        protests and all other notices whatever.

      

      9.
        Governing Law. This Subordinated Note shall be governed by, and construed
        in
        accordance with, the laws of the State of Texas without giving effect to
        the
        principles of conflicts of laws.

      

      10.
        Binding. This Subordinated Note shall be binding upon the successors and
        assigns
        of the Company. A Holder of this Subordinated Note may not assign or transfer
        this Subordinated Note to any person or entity without the Company’s prior
        written consent. 

       

    

    11.
      Notices. Any notice to be given hereunder shall be in writing, shall be sent
      to
      the Holder’s address as specified in the first paragraph hereof or the Company’s
      address set forth below its signature hereto, as the case may be, and shall
      be
      deemed received (i) on the earlier of the date of receipt or the date three
      business days after deposit of such notice in the United States mail, if sent
      postage prepaid, certified mail, return receipt requested or (ii) when actually
      received, if personally delivered.

    

    12.
      Definitions. In addition to such other terms as are elsewhere defined herein,
      as
      used in this Subordinated Note the following terms shall have the following
      meanings:

    

    “Bankruptcy
      Code” means Title 11 of the United States Code.

     

    “Business
      Day” means (a) any day other than a Saturday, Sunday or other day on which banks
      in New York, New York are authorized or required to close and (b) any such
      day
      that is also a day on which dealings in United States dollar deposits are
      carried out in the London interbank market.

    

    “Insolvency
      Proceeding” means any action, case or proceeding commenced by or against the
      Company, or any agreement of the Company, for (i) the entry of an order for
      relief under any chapter of the Bankruptcy Code or other insolvency or debt
      adjustment law (whether state or federal), (ii) the appointment of a receiver,
      trustee, liquidator or other custodian for the Company or any part of its
      property, (iii) an assignment or trust mortgage for the benefit of creditors
      of
      the Company, or (iv) the liquidation, dissolution or winding up of the affairs
      of the Company.

     

      “Senior
      Creditor” means Holigan
      Racing, L.P., a Texas limited partnership, together with its successors and
      permitted assigns. 

    

    “Senior
      Debt” means all loans, letters of credit, advances, liabilities, debit balances,
      covenants and duties at any time owed by the Company to the Senior Creditor,
      whether direct or indirect, absolute or contingent, secured or unsecured, due
      or
      to become due, now existing or hereafter arising, including, without limitation,
      any and all liabilities and obligations now or hereafter owing by the Company
      to
      the Senior Creditor under the Senior Note and any debt, liability or obligation
      owing by the Company to others which the Senior Creditor may have obtained
      by
      assignment, pledge, purchase or otherwise, together with all interest, fees,
      charges, expenses and attorney’s fees for which the Company is now or hereafter
      becomes liable to pay to the Senior Creditor under any agreement or by
      law.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    

    “Senior
      Note” means that certain Senior
      Secured Convertible Promissory Note, dated April 3, 2008 executed by the Company
      in favor of the Senior Creditor in the original principal amount of
      $1,400,000.00, as amended, restated or otherwise modified from time to
      time.

     

    “Subordinated
      Debt” means all loans, advances, liabilities, debit balances, obligations,
      covenants and duties at any time owed by the Company to the Holder, whether
      direct or indirect, absolute or contingent, secured or unsecured, due or to
      become due, now existing or hereafter arising, including, without limitation,
      all liabilities of the Company to the Holder under this Subordinated Note and
      any debt, liability or obligation owing by the Company to others which the
      Holder may have obtained by assignment, pledge, purchase or otherwise, together
      with all interest, fees, charges, expenses and attorney’s fees for which the
      Company is now or hereafter becomes liable to pay to the Holder under any
      agreement or by law.

     

    “Person”
      means any individual, partnership, firm, corporation, association, joint
      venture, limited liability company, trust or other entity, or any governmental
      authority.

     

    

    [Signatures
      on Next Page]

    
      
        
        

      

      
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    IN
      WITNESS WHEREOF,
      the
      Company has executed and delivered this Subordinated Note under seal as of
      the
      date and year first written above.

     

    
      	 	
              BOO
                KOO HOLDINGS, INC.

            
	 	 	 	 	 
	 	 	 	 	 
	 	
              By:

            	    
	 
	 	 	
              Name:

            	
              Stephen
                C. Ruffini

            
	 	 	
              Title:

            	
              COO/CFO

            
	 	 	 	 	 
	 	 	 	 	 
	 	
              ADDRESS:

            
	 	 	 	 	 
	 	
              Boo
                Koo Beverages, Inc. 

            
	 	
              4951
                Airport Parkway, Suite 660

            
	 	
              Addison,
                Texas 75001

            
	 	
              Attention:Stephen
                C. Ruffini

            
	 	
              Telephone:
                (972)
                818-3862

            
	 	
              Telecopy:
                (972)
                930-9463

            

    

    

    Acknowledged
      and Agreed: 

     

    
      	
              By:

            	    
	 
	 	
              Name:Exhibit
      10.2

     

    Warrant
      Number: __

     

    NEITHER
      THIS WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS
      WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY STATE
      SECURITIES LAWS, AND NEITHER THIS WARRANT NOR SUCH SHARES MAY BE SOLD,
      ENCUMBERED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
      STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR AN EXEMPTION
      FROM SUCH REGISTRATION REQUIREMENTS.

     

    Void
      after 5:00 p.m. Central Standard Time on __________.

     

     

    WARRANT
      TO PURCHASE COMMON STOCK OF 

     

    BOO
      KOO HOLDINGS, INC.

     

    FOR
      VALUE
      RECEIVED, Boo Koo Holdings, Inc., a Delaware corporation (the "Company"), hereby
      certifies that ___________,
      or his
      permitted assignees, is entitled to purchase from the Company the number of
      fully paid and non-assessable shares of the Common Stock, $0.01 par value,
      of
      the Company as determined in the next paragraph at the Per Share Warrant Price
      of $0.01 per share prior to 5:00 p.m. Central Standard Time on _________, as
      adjusted herein pursuant to Section 3. (Hereinafter, (i) said Common stock,
      together with any other equity securities which may be issued by the Company
      with respect thereto or in substitution therefor, is referred to as the "Common
      Stock," (ii) the shares of Common Stock purchasable hereunder are referred
      to as
      the "Warrant Shares," (iii) the aggregate purchase price payable hereunder
      for
      the Warrant shares is referred to as the "Aggregate Warrant Price," (iv) the
      price payable hereunder for each of the Warrant Shares is referred to as the
      "Per Share Warrant Price," (v) this Warrant, and all warrants hereafter issued
      in exchange or substitution for this Warrant for this Warrant are referred
      to as
      the "Warrant" and (vi) the holder of this Warrant is referred to as the
      "Holder." The Per Share Warrant Price is subject to adjustment as hereinafter
      provided, and in the event of any such adjustment, the number of Warrant Shares
      shall be adjusted by dividing the Aggregate Warrant Price by the Per Share
      Price
      in effect immediately after such adjustment.

     

    The
      number of Warrant Shares purchasable hereunder (subject to adjustment as set
      forth herein) shall equal ________ shares of Common Stock, adjusted as of the
      date of such purchase, as provided for in numbered paragraph 3
      below.

     

    1.  Exercise
      of Warrant.
      

     

    (a)     
      This
      Warrant may be exercised by the Holder by the surrender of this Warrant (with
      the subscription form at the end hereof duly executed) at the address set forth
      in Subsection 9(a) hereof, together with proper payment of the Aggregate Warrant
      Price. Payment for Warrant Shares shall be made by certified or official bank
      check payable to the order of the Company. Upon such surrender of this Warrant,
      the Company will issue a certificate or certificates in the name of the Holder
      for the largest number of whole shares of the Common Stock to which the Holder
      shall be entitled and in lieu of any fractional share of the Common Stock to
      which the Holder shall be entitled, cash equal to the fair value of such
      fractional share (determined in such reasonable manner as the Board of Directors
      of the Company shall determine).

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    (b) No
      Warrant granted herein shall be exercisable after _________

     

    2.  Reservation
      of Warrant Shares.
      The
      Company agrees that, prior to the expiration of this Warrant, it will at all
      times have authorized and in reserve, and will keep available, solely for
      issuance or delivery upon the exercise of this Warrant, the shares of Common
      Stock as from time to time shall be receivable upon the exercise of this
      Warrant.

     

    3.  Anti-Dilution
      Provisions.
      

     

    (a)  If,
      at
      any time or from time to time after the date of this Warrant, the Company shall
      distribute to the holders of the Common Stock (i) securities, other than shares
      of the Common Stock, or (ii) property, other than cash, without payment
      therefor, with respect to the Common Stock, then, and in such case, the Holder,
      upon the exercise of this Warrant, shall be entitled to receive the securities
      and properties which the Holder would hold on the date of such exercise if,
      on
      the date of this Warrant, the Holder had been the holder of record of the number
      of shares of the Common Stock subscribed for upon such exercise and, during
      the
      period from the date of this Warrant to and including the date of such exercise,
      had retained such shares and the securities and properties (as described in
      (i)
      and (ii) above) receivable by the Holder during such period. Notice of each
      such
      distribution shall be mailed to the Holder within 30 days after the date of
      any
      such distribution.

     

    (b)  In
      case
      the Company shall hereafter (i) pay a dividend or make a distribution on its
      capital stock in shares of Common Stock, (ii) subdivide its outstanding shares
      of Common Stock into a greater number of shares, (iii) combine its outstanding
      shares of Common Stock into a smaller number of shares, or (iv) issue by
      reclassification of its Common Stock any shares of capital stock of the Company,
      the Per Share Warrant Price in effect immediately prior to such action shall
      be
      adjusted so that if the Holder surrendered this Warrant for exercise immediately
      thereafter the Holder would be entitled to receive the number of shares of
      Common Stock or other capital stock of the Company which he would have owned
      immediately following such action had such Warrant been exercised at that time.
      An adjustment made pursuant to this subsection (b) shall become effective
      immediately after the record date in the case of a dividend or distribution
      and
      shall become effective immediately after the effective date in the case of
      a
      subdivision, combination or reclassification.

     

    (c)  Whenever
      the Per Share Warrant Price is adjusted as provided in this Section 3 and upon
      modification of the rights of the Holder of this Warrant in accordance with
      this
      Section 3, the Company shall promptly prepare a certificate of an officer of
      the
      Company, setting forth the Per Share Warrant Price and the number of Warrant
      Shares after such adjustment or modification, a brief statement of the facts
      requiring such adjustment or modification, and the manner of computing the
      same
      and cause a copy of such certificate to be mailed to the Holder within 30 days
      after the date of such adjustment.

     

    (d)  If
      the
      Board of Directors of the Company shall declare any dividend or other
      distribution in cash with respect to the Common Stock, the Company shall mail
      notice thereof to the Holder not less than 15 days prior to the record date
      fixed for determining shareholder entitled to participate in such dividend
      or
      other distribution.

     

    
      
         

      

      
        -2-

        
          

        

      

      
         

      

       

    

    4.  Fully
      Paid Stock; Taxes.
      The
      Company agrees that the shares of the Common Stock represented by each and
      every
      certificate for Warrant Shares delivered on the exercise of this Warrant shall,
      at the time of such delivery, be validly issued and outstanding, fully paid
      and
      non-assessable, and not subject to preemptive rights and the Company will take
      all such actions as may be necessary to assure that the par value or stated
      value, if any, per share of the Common Stock is at all times equal to or less
      than the then Per Share Warrant Price. The Company further covenants and agrees
      that it will pay, when due and payable, all Federal and state stamp or similar
      taxes that may be payable in respect to the issue of any Warrant Share of
      certificate therefor. 

     

    5.  Transfer.

     

    (a)  Securities
      Laws.
      This
      Warrant has not been registered under the Securities Act of 1933, as amended
      (the "Securities Act") or under any state securities laws and unless so
      registered may not be transferred, sold, pledged, hypothecated or otherwise
      deposed of unless an exemption from such registration is available. In the
      event
      the Holder desires to transfer this Warrant, the Holder must give the Company
      prior written notice of such proposed transfer including the name and address
      of
      the proposed transferee. Such transfer may be made only upon receipt of the
      Company of an opinion of counsel to the Holder, or other evidence, if reasonably
      requested by the Company, to the effect that the proposed transfer will not
      violate the provisions of the Securities Act, the Securities Exchange Act of
      1934, as amended, or the rules and regulations promulgated under either such
      act.

     

    (b)  Conditions
      to Transfer.
      Prior
      to any proposed transfer referred to in subparagraph (a) above, and as a
      condition thereto, if such transfer is not made pursuant to an effective
      registration statement under the Securities Act, the Holder will, if requested
      by the Company, deliver to the Company (i) an investment covenant signed by
      the
      proposed transferee, (ii) an agreement by such transferee to the impression
      of
      the restrictive investment legend set forth herein on the certificate or
      certificates representing the securities acquired by such transferee, (iii)
      an
      agreement by such transferee that the Company may place a "stop transfer order"
      with its transfer agent or registrar, and (iv) an agreement by the transferee
      to
      indemnify the Company to the same extent as set forth in the next succeeding
      paragraph.

     

    (c)  Indemnity.
      The
      Holder acknowledges that the Holder understands the meaning and legal
      consequences of this Section 5, and the Holder hereby agrees to indemnify and
      hold harmless the Company, its representative and each officer and director
      thereof from and against any and all loss, damage or liability (including all
      attorney's fees and costs incurred in enforcing this indemnity provision) due
      to
      or arising out of (a) the inaccuracy of any representation or the breach of
      any
      warranty of the Holder contained in, or any other breach of this Warrant, (b)
      any transfer of any of the Warrant or the Warrant Shares in violation of the
      Securities Act, the Securities Exchange Act of 1934, as amended, or the rules
      and regulations promulgated under either of such acts, (c) any transfer of
      the
      Warrant or any of the Warrant Shares not in accordance with this Warrant or
      (d)
      any untrue statement or omission to state any material fact in connection with
      the investment representations or with respect to the facts and representations
      supplied by the Holder to counsel to the Company upon which its opinion as
      to a
      proposed transfer shall have been based.

     

    (d)  Transfer.
      Subject
      to the restrictions contained herein, this Warrant and the Warrant Shares issued
      may be transferred by the Holder in whole or in part at any time or from time
      to
      time upon surrender of this Warrant properly endorsed. Upon surrender of this
      Warrant to the Company or at the office of its stock transfer agent, if any,
      with assignment documentation duly executed and funds sufficient to pay any
      transfer tax, and upon compliance with the foregoing provisions, the Company
      shall, without charge, execute and deliver a new Warrant in the name of the
      assignee named in such instrument of assignment, and this Warrant shall promptly
      be canceled. Any assignment, transfer, pledge, hypothecation or other
      disposition of this Warrant attempted contrary to the provisions of this
      Warrant, or any levy of execution, attachment or other process attempted upon
      the Warrant shall be null and void and without effect.

     

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

       

    

    (e)  Legend
      and Stop Transfer Order.
      The
      Company shall instruct its transfer agent to enter stop transfer orders with
      respect to the shares of Common Stock issuable upon exercise of the Warrants,
      and all certificates representing Warrant Shares shall bear on the face thereof
      substantially the following legend:

     

    "The
      shares of common stock represented by this certificate have not been registered
      under the Securities Act of 1933, as amended, and may not be sold, offered
      for
      sale, assigned, transferred or otherwise disposed of unless registered pursuant
      to the provisions of that Act or an opinion of counsel to the Company is
      obtained stating that such disposition is in compliance with an available
      exemption from such registration."

     

    6.  Registration
      Rights.
      The
      Company hereby agrees to use commercially reasonable efforts to provide
      registration rights with regard to the Warrant Shares issuable to Holder and
      its
      affiliates upon exercise of this Warrant that are the same as the registration
      rights provided to investors in the next round of equity financing.

     

    7.  Loss,
      etc. of Warrant.
      Upon
      receipt of evidence satisfactory to the Company of the loss, theft, destruction
      or mutilation of this Warrant, and of indemnity reasonably satisfactory to
      the
      Company, if lost, stolen or destroyed, and upon surrender and cancellation
      of
      this Warrant, if mutilated, the Company shall execute and deliver to the Holder
      a new Warrant of like date, tenor and denomination.

     

    8.  Warrant
      Holder Not Shareholder.
      No
      holder
      of this Warrant shall be entitled, as a Warrant holder, to vote or receive
      dividends or be deemed the holder of the Warrant Shares or any other securities
      of the Company which may at any time be issuable on the exercise hereof for
      any
      purpose, nor shall anything contained herein be construed to confer upon the
      holder of this Warrant, as such, any of the rights of a stockholder of the
      Company or any right to vote for the election of directors or upon any matter
      submitted to stockholders at any meeting thereof, or to give or withhold consent
      to any corporate action (whether upon any recapitalization, issuance of stock,
      reclassification of stock, change of par value, consolidation, merger,
      conveyance, or otherwise) or to receive notice of meetings, or to receive
      dividends or subscription rights or otherwise until the Warrant shall have
      been
      exercised and the Warrant Shares purchasable upon the exercise hereof shall
      have
      become deliverable, as provided herein.

     

    9.  Communication.
      All
      notices and other communications required or permitted hereunder shall be in
      writing, shall be effective when given, and shall in any event be deemed to
      be
      given upon receipt or, if earlier, (a) five (5) days after deposit with the
      U.S.
      Postal Service or other applicable postal service, if delivered by first
class
      mail, postage prepaid,
      (b) upon
      delivery, if delivered by hand, (c) one business day after the business day
      of
      deposit with Federal Express or similar overnight courier, freight prepaid
      or
      (d) one business day after the business day of facsimile transmission, if
      delivered by facsimile transmission with copy by first class mail, postage
      prepaid, and shall be
      addressed:

     

    
      
         

      

      
        -4-

        
          

        

      

      
         

      

       

    

    (a)  the
      Company at 4951 Airport Parkway, Suite 660, Addison, Texas 75001,
      Attention: President; and

     

    (b)  the
      Holder at _____________________; or such other address as the Holder has
      designated in writing to the Company.

     

    10.  Representations
      and Warranties by the Holder.
      The
      Holder represents and warrants to the Company as follows:

     

    (a) This
      Warrant and the Warrant Shares issuable upon exercise thereof are being acquired
      for his own account, for investment and not with a view to, or for resale in
      connection with, any distribution or public offering thereof within the meaning
      of the Act, other than to his affiliates or investors in a private transaction
      in compliance with applicable securities laws. Upon exercise of this Warrant,
      the Holder shall, if so requested by the Company, confirm in writing, in a
      form
      satisfactory to the Company, that the securities issuable upon exercise of
      this
      Warrant are being acquired for investment and not with a view toward
      distribution or resale as set forth herein.

     

    (b) The
      Holder understands that the Warrant and the Warrant Shares have not been
      registered under the Securities Act by reason of their issuance in a transaction
      exempt from the registration and prospectus delivery requirements of the
      Securities Act pursuant to Section 4(2) thereof, and that they must be held
      by
      the Holder indefinitely, and that the Holder must therefore bear the economic
      risk of such investment indefinitely, unless a subsequent disposition thereof
      is
      registered under the Securities Act or is exempted from such registration.
      

     

    (c) The
      Holder has such knowledge and experience in financial and business matters
      that
      it is capable of evaluating the merits and risks of the purchase of this Warrant
      and the Warrant Shares purchasable pursuant to the terms of this Warrant and
      of
      protecting his interests in connection therewith.

     

    (d) The
      Holder is able to bear the economic risk of the purchase of the Warrant Shares
      pursuant to the terms of this Warrant.

     

    (e) The
      Holder is an “accredited investor” as such term is defined in Rule 501 of
      Regulation D promulgated under the Securities Act.

     

    11.  Headings.
      The
      headings of this Warrant have been inserted as a matter of convenience and
      shall
      not affect the construction hereof.

     

    12.  Applicable
      Law.
      This
      Warrant shall be governed by and construed in accordance with the laws of the
      State of Texas without regard to the conflict of laws principles
      thereof.

     

    13.  Certification.
      Each of
      Company and Holder (by acceptance of this Warrant) hereby certifies to the
      other
      that (i) the Company or Holder as applicable, has been advised to seek the
      advice of an attorney and an accountant in connection with this Warrant; and
      (2)
      the Company and Holder have had the opportunity to seek the advice of an
      attorney and accountant of the Company’s or Holder’s, as applicable, choice in
      connection with this Warrant.

     

    
      
         

      

      
        -5-

        
          

        

      

      
         

      

    

     

    [Remainder
      of Page Left Intentionally Blank]

     

     

    
      
         

      

      
        -6-

        
          

        

      

      
         

      

    

     

    IN
      WITNESS WHEREOF, Boo Koo Holdings, Inc. has caused this Warrant to be signed
      by
      its duly authorized officer as of this _____ day of ________, 2008.

     

     

    BOO
      KOO
      HOLDINGS, INC.

    
 

    By:
      ___________________    

    Name:
      Stephen C. Ruffini

    Title:
      COO/CFO

    
      
         

      

      
        -7-

        
          

        

      

      
         

      

    

     

    SUBSCRIPTION

     

     

    The
      undersigned, ________________________________ pursuant to the provisions of
      the
      foregoing Warrant agrees to subscribe for the purchase of ______________ shares
      of the Common Stock of Boo Koo Holdings, Inc., a Delaware corporation, covered
      by said Warrant, and makes payment therefor in full at the price per share
      provided by said Warrant.

     

     

    

      
        	
                Dated:
                  _____________________________ 

              	
                Signature:________________

              
	 	
                Address:

              

      

    

    

    
      
         

      

      
        -8-

        
          

        

      

      
         

      

    

     

    ASSIGNMENT

     

     

    

     

     

    FOR
      VALUE
      RECEIVED, ________________________________ hereby sells, assigns and transfers
      unto _________________ the foregoing Warrant and all rights evidenced thereby,
      and does irrevocably constitute and appoint __________________ an attorney,
      to
      transfer said Warrant on the books of Boo Koo Holdings, Inc., a Delaware
      corporation.

     

     

    

      
        	
                Dated:
                  _____________________________ 

              	
                Signature:________________

              
	 	
                Address:

              

      

    

     

    
      
         

      

      
        -9-

        
          

        

      

      
         

      

       

    

    PARTIAL
      ASSIGNMENT

     

     

    

     

     

    FOR
      VALUE
      RECEIVED, ___________________________ hereby sells, assigns and transfer unto
      ________________________ the right to purchase _____________ shares of the
      Common Stock of Boo Koo Holdings, Inc., a Delaware corporation, by the foregoing
      Warrant, and a proportionate part of said Warrant and the rights evidenced
      hereby, and does irrevocably constitute and appoint
      ______________________________, an attorney, to transfer that part of said
      Warrant on the books of Boo Koo Holdings, Inc.

     

     

    

      
        	
                Dated:
                  _____________________________ 

              	
                Signature:________________

              
	 	
                Address:

              

      

    

     

    
      
         

      

      
        -10-

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