Document:

ex1011.htm

Exhibit 10.11

 

CONVERTIBLE NOTE AGREEMENT

 

 

This Convertible Note Agreement ("Agreement") is made and effective the December 15, 2010,

 

	
BETWEEN:

	
Trellis Earth Products, Inc. (the "Company"), a corporation organized and existing under the laws of the Oregon, with its head office located at:

 

13315 NE Airport Way, Suite 800, Portland Oregon 97213

 

	
AND:   

	
Wen-Hsin Yip

 

(the "Lender"), individual residing at 21915 S.W. Stafford Road, Tualatin, OR 97062

 

WHEREAS, Note Holders are willing to lend Company the aggregate sum of $200,000.00 be evidenced by 18% Convertible Promissory Notes (14% payable monthly as cash interest, 4% Preferred Shares payable at rate of $.50/share payable monthly, for a combined cash and share rate of 18% annual).

 

In consideration of the mutual covenants and conditions herein contained, the parties hereby agree, represent and warrant as follows:

 

1. ISSUE OF NOTES

 

	
a.  

	
The Company will authorize the issue of its 18% Convertible notes (hereinafter called "Notes") in the aggregate principal amount of $200,000.00 to be dated December 15, 2010, to mature on JUNE 30, 2011, to bear interest on the unpaid principal thereof at the rate of 18%per annum until maturity.

 

	
b.  

	
For the purposes of calculating interest for any period for which the interest shall be payable, such interest shall be calculated on the basis of a ACTUAL day month and a 365 day year. The Company will promptly and punctually pay to Note Holders or their nominee the interest on any of the Notes held by Note Holders without presentment of the Notes. In the event that Note Holders shall sell or transfer any of the Notes, they shall notify the Company of the name and address of the transferee. In the event the Company defaults on any installment of interest or principal, then any Holder of these Notes may, at his option, without notice, declare the entire principal and the interest accrued thereon immediately due and payable and may proceed to enforce the collection thereof. All the Notes shall contain a confession of judgment provision.

 

	
c.  

	
The Company will also authorize the issue of 400,000 shares of its preferred stock (hereinafter called "The Stock") and will authorize the issuance of and reserve for such purchase if LENDER elects to convert the Note anytime during or upon the termination of the Note. The rate of conversion should be $.50/share, with all outstanding interest due and accrued at time of conversion paid in cash. No interest payable shall convert to shares. The maximum number of shares available is 400,000. Any portion or the full amount of this allotment can be converted anytime up to and including June 30, 2011.

 

  

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IN WITNESS WHEREOF, Company and Note Holders have executed this agreement at PORTLAND OREGON ON DECEMBER 15, 2010.

 

 

	COMPANY 	 	 	NOTE HOLDERS	 
	 	 	 	 	 
	 	 	 	 	 
	
/s/ William Collins  

	 	 	
/s/ Wen-Hsin Yip

	 
	

Authorized Signature

	 	 	
Authorized Signature

	 
	 	 	 	 	 
	 	 	 	 	 
	William Collins, CEO	 	 	Wen-Hsin Yip	 
	Print Name and Title 	 	 	Print Name and Title	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 

 

 

 

 

 

 

 

 

2ex1012.htm

Exhibit 10.12

 

PROMISSORY NOTE

 

	$100,000.00   	January 1, 2009

 

For valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Trellis Earth Products, Inc., an Oregon corporation ("Company"), hereby promises to pay to the order of Ernest G. Bootsma ("Seller"), in lawful money of the United States of America, the principal sum of $100,000.00, together with and including all interest as provided below in this Note.

 

1.          Interest Rate. Company promises to pay interest on the unpaid principal balance of this Note, from and including the date of this Note until paid in full, at the rate of five percent per annum. The interest rate, based upon a 360-clay year and the actual days elapsed.

 

2.          Payment.

 

2.1Maturity Date. Company shall pay the entire principal balance and all

 

accrued but unpaid interest on the earlier of (the "Maturity Date"):

 

(a)          The date that is five years after the date of this Agreement;

 

(b)          The sale, conveyance or disposal of all or substantially all of Company's property or business, or Company's merger with or into or consolidation with any other corporation, or if Company effects any other transaction or series of related transactions in which more than 50 percent of the voting stock of Company is transferred, sold, or disposed of and Company is not the survivor in such transaction or series of transactions;

 

(e)The liquidation, dissolution or indefinite cessation of the business

 

operations of Company;

 

(d)          The execution by Company of a general assignment for the benefit of creditors or the appointment of a receiver or trustee to take possession of the property or assets of Company; or

 

(e)          A firm commitment for an underwritten public offering by Company of shares of its Common Stock.

 

2.2 Prepayment. Company may pay all or any part of the principal balance of this Note and all accrued but unpaid interest at any time without penalty.

 

 2.3 Receipt of Payments. All payments specified in this Note shall be deemed made when actually received by Seller, and shall be made without offset and without prior notice or demand.

 

2.4 Form of Payment. All payments shall be in lawful money of the United States of America.

 

  

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3.         Default. Time is of the essence of this Note. A default of this Note shall occur if

 

(a)           Company fails to make any payment under this Note within 10 days after the date due, or

(b)           an event of default occurs under the terms of any of the Transaction Documents (as defined in the Stock Redemption Agreement and Mutual Release dated the same date as this Note).

 

4.         Remedies. In the event of a default of this Note, Seller may take any one or mom of the following steps:

 

4.1 Acceleration. Declare the entire unpaid principal balance of the debt evidenced by this Note, and all accrued interest thereon and all other costs and expenses evidenced by this Note, to be immediately due and payable.

 

4.2 Other Remedies. Pursue any other right or remedy provided in this Note or in any other agreement or instrument executed by Company in connection with this Note, or as otherwise allowed by law. Seller may pursue any such rights or remedies singly, together or successively. Exercise of any such right or remedy shall not be deemed an election of remedies. Failure to exercise any right or remedy shall not be deemed a waiver of any existing or subsequent default, nor a waiver of any such right or remedy.

 

 5. Collection Costs. Company agrees to pay all costs of collection for the amounts due under this Note, including reasonable attorney fees, whether or not litigation is actually commenced. In the event that Seller are made party to any litigation because of the existence of the indebtedness evidenced by this Note, Company shall reimburse Seller for their costs and attorneys' fees incurred with respect to such litigation. In the event that suit or action is instituted by a party to this Note to enforce or interpret any provision of this Note, or to collect any amount due hereunder, the prevailing party shall be entitled to receive from the other party, in addition to all other sums and relief, its reasonable costs and attorneys' fees, incurred both at and in preparation for trial, any appeal or review, or in any claim or adversary proceedings in bankruptcy, such amount to be set by the court(s) before which the matter is heard.

 

 6. Waivers. Company hereby (a) waives diligence, presentment, protest and demand, and (b) waives notice of protest, or consent to any extension or alteration of the time or terms of payment of this Note, any release of all or any part of any security which may be given for the payment of this Note, any acceptance of additional security of any kind, and any release of or resort to any party liable for payment of this Note, any of which may be made without notice to any of such parties.

 

7.         Miscellaneous Provisions.

 

7.1         Governing Law. This Note shall be governed by and construed in accordance with the laws of the state of Oregon.

 

7.2 Severability. If any provision of this Note is found by a court of competent jurisdiction to be invalid or unenforceable as written, then the parties intend and desire that (a) such provision be enforceable to the full extent permitted by law, and (b) the invalidity or unenforceability of such provision shall not affect the validity and enforceability of the remainder of this Note.

 

 7.3 Amendments. This Note may not be amended, modified or changed, nor shall any provision of this Note be deemed waived, except only by an instrument in writing signed by the party against whom enforcement of any such waiver, amendment, change or modification is sought.

 

7.4         No Assignment. Company shall not assign this Note to any party without the express written consent of Seller.

 

7.5         Binding Effect. This Note shall be binding upon the successors and permitted assigns of Company.

 

 7.6 Terms. All capitalized terms used in this Note that are not otherwise defined shall have the meanings given to them in the Stock Redemption Agreement and Mutual Release dated the same date as this Note.

 

	 	Company:	 
	 	 	 
	 	

TRELLIS EARTH PRODUCTS, INC.

	 
	 	 	 	 
	 	
By: 

	/s/ William Collins	 
	 	 	William Collins, CEO	 
	 	 	 	 

 

3ex1013.htm

Exhibit 10.13

 

 

PROMISARY NOTE

 

 

	$75,000.00	
                                                                                                        January 1, 2009 to February 1, 2010

 

 

 

FOR VALUABLE CONSIDERATION, the receipt and sufficiency of which are hereby acknowledged, TRELLIS EARTH PRODUCTS, INC., an Oregon corporation ("Borrower"), hereby promises to pay to the order of WILLIAM COLLINS ("Lender"), at such address or place as Lender may from time to time designate, the sum of $75,000.00, together with interest on such balance from the date of this Note set forth above (the "Disbursement Date") until paid in full as provided below in this Note.

 

1.           Interest and Payment.

 

1.1 Interest Rate. Borrower promises to make interest payments, from and including the Disbursement Date until paid in full, on the unpaid principal balance of this Note at a rate equal to 12 percent per annum and calculated on a 365-day accrual basis, compounded monthly. The entire balance of the note becomes due February 1, 2010.

 

1.2 Maturity Date. The entire unpaid principal balance of this Note and all accrued but unpaid interest thereon shall be due and payable in full on or before the date that is 13 months after the Note Date (above), or immediately upon demand by Lender after a default as provided below in Section 4 (the "'Maturity Date"). The Lender may extend the Maturity Date in writing at the discretion of the Lender.

 

1.3 Monthly Interest Payments. On the date that is one month after the Disbursement Date and on the same day each month thereafter until the Maturity Date. Borrower shall make a monthly interest payment of 1% of the note principle value.

 

1.4 Prepayment. All or any part of the principal balance of this Note and all accrued but unpaid interest thereon may be prepaid by Borrower at any time without notice or penalty.

 

1.5 Place and Time. All payments specified in this Note shall be deemed made when actually received by Lender. All payments shall be made to Lender at such address or place as Lender may from time to time designate, and shall be made without setoff and without prior notice or demand.

 

1.6 Form and Application. All payments shall be in lawful money of the United States of America. Payments shall be applied as follows: (a) first, to the payment of accrued interest; and (b) second, to the reduction of principal of this Note.

 

2.           Security. Borrower hereby assigns and grants to Lender a security interest in all inventory of products purchased from the Suppliers (as defined below), now owned or hereafter acquired ("Inventory") as well as receivables of Trellis Earth Products, Inc.

  

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3.          Maturity. The entire unpaid principal balance of this Note and all accrued but unpaid interest thereon shall be due and payable on or before the date that is 13 months after the Note Date, or immediately upon demand by Lender after a default as provided below in Section 4 (the "Maturity Date"). The Lender may extend the Maturity Date in writing at the discretion of the Lender.

 

4.          Default. Time is of the essence of this Note. A default shall occur if (a) Borrower fails to make any monthly payment under this Note within 10 days after the date that it is due, or (b) if Borrower fails to perform any covenant or obligation of Borrower under this Note and such failure is not corrected after 30 days after written notice of the failure.

 

5.           Remedies.  In the event of a default, Lender may take any one or more of the following steps:

 

5.1 Acceleration. Declare the entire unpaid principal balance of the debt evidenced by this Note, and all accrued interest thereon and all other costs and expenses evidenced by this Note, to be immediately due and payable.

 

5.2 Other Remedies. Pursue any other right or remedy provided in this Note, enforce the security interest given to Lender pursuant to the Uniform Commercial Code and any other applicable law, pursue any other remedy otherwise allowed by law. Lender may pursue any such rights or remedies singly, together or successively. Exercise of any such right or remedy shall not be deemed an election of remedies. Failure to exercise any right or remedy shall not be deemed a waiver of any existing or subsequent default, nor a waiver of any such right or remedy.

 

6.           Attorney Fees and Collection Costs. Borrower agrees to pay all costs of collection of this Note, including reasonable attorney fees, whether or not litigation is actually commenced. In the event litigation is commenced by a party to this Note to enforce or interpret any provision of this Note, or to collect any amount due under this Note, the prevailing party in such litigation shall be entitled to receive, in addition to all other sums and relief, its reasonable costs and attorney fees, incurred both at and in preparation for trial and any appeal or review, such amount to be set by the court(s) before which the matter is heard.

 

7.           Amendment. This Note may not be amended, modified or changed, nor shall any provision of this Note be deemed waived, except only by an instrument in writing signed by the party against whom enforcement of any such waiver, amendment, change or modification is sought.

 

8.           Waivers. Borrower hereby waives (a) diligence, presentment, protest and demand. (b) notice of protest, or consent to any extension or alteration of the time or terms of payment of this Note, any release of all or any part of any security which may be given for the payment of this Note, any acceptance of additional security of any kind, and any release of or resort to any party liable for payment of this Note, any of which may be made without notice to any of such parties.

 

9.          Binding Agreement. This Note shall be binding upon the successors and permitted assigns of Borrower.

 

10.          Governing Law. This Note has been executed under and shall be construed and enforced in accordance with the laws of the state of Oregon.

 

	 	
TRELLIS EARTH PRODUCTS, INC.

	 
	 	 	 	 
	 	
By: 

	
/s/ William Collins

	 
	 	 	
William Collins, CEO and President

	 
	 	 	 	 

 

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