Document:

ex10-35.htm

Exhibit 10.35

Binding Term Sheet

	
Issuer:

	
Global Gold Consolidated Resources Limited (“GGCR”)

 

	
Subscriber:

	
Consolidated Resources Armenia and affiliates (“CRA”)

 

	
Transaction:

	
Convertible Notes (“the Notes”)

 

	
Principal Amount:

	
Not less than US$2 million during the Interim Period in accordance with the Use of Proceeds as defined herein, unless otherwise agreed to and approved by 75% of the Board of GGCR

 

	
Use of Proceeds:

	
In accordance with the GGCR Interim Funding Budget, which is to be unanimously approved by the Board of Directors of GGCR

 

	
Advance:

	
$377,134 to be funded directly to Armenia in accordance with the GGCR Interim Funding Budget prior to the planned closing of the Joint Venture (the “GGCR Advance Funding”) scheduled for the week of January 9th, 2012

 

	
Funding Term:

	
Interim Period, defined as the period beginning immediately after the closing of the Joint Venture and ending at the completion of the Public Listing process as defined in section 2.4 of the Joint Venture agreement

 

	
Funding Process:

	
Given the dynamic funding requirements of the Properties, as defined in the Joint Venture agreement, all funding needs under the Board approved GGCR Budget will be met by periodic request from any one or more members of the GGCR Board following which approval will be required from 75% of the GGCR Board.  In the event of a GGCR stalemate for more than 10 days, a decision may be made based on a majority vote and the parties acknowledge and agree that funds for the budget may be provided from BNP Paribas, Industrial Minerals, ABB, Firebird Management, individual directors, or other sources that have provided funding in the past.

 

	
Co-investment Right:

	
GGC may co-invest with CRA on an equivalent basis in the Notes

 

	
Maturity

	
1 year

 

	
Cash Coupon / Minimum Return:

	
3% per annum Cash Coupon / Guaranteed Minimum Annual IRR of 15% at a liquidity event (“Liquidity Event”)

 

	
Conversion:

	
At the Liquidity Event, the principal amount of the Notes will be repaid in full based on the value of the Notes at market (the “Market Value”) assuming a conversion value into new common shares of GGCR representing a value agreed to in section 2.5 of the Joint Venture agreement (for the avoidance of doubt, the value is 1% of the existing shares of JVC then held by GGC for each $784,314 of the Notes).  Except as provided for under the Cash Election in Section 2.5 of the Joint Venture agreement, the Notes may not be voluntarily converted by CRA into GGCR except by the unanimous consent of the Board of Directors of GGCR and otherwise will become due at the earlier of the Liquidity Event or Maturity, subject to Section 2.5 of the Joint Venture agreement

 

 

  

  

  

 

	
Liquidity Event:

	
Liquidity Event is defined as an IPO or a change of control of GGCR or any of its subsidiaries including Mego-Gold LLC or Getik Mining Company LLC

 

	
Put/Call Feature:

	
None

 

	
Prepayment:

	
The Notes may be repaid early at any time prior to the Liquidity Event without penalty.

 

	
Information Rights:

	
Quarterly reporting on financial and operational progress at GGCR

 

	
Events of Default:

	
Those typical for transactions of this type, including, without limitation, change of control and cross-default to other indebtedness and specified material contracts, subject to appropriate cure periods

 

	
Security:

	
The obligations of GGCR under the Notes would be secured by a guarantee of Global Gold Corporation until the closing of the joint venture

 

	
Representations and Warranties

	
Usual and customary for transactions of this type, including, without limitation: (i) corporate status, (ii) corporate power and authority/enforceability, (iii) no violation of law or contracts or organizational documents, (iv) no litigation, (v) accuracy of financial statements and no material adverse change, and (vi) perfected security interests in respect of the Security (as described herein).

 

	
Covenants

	
By GGCR: usual and customary for transactions of this type, including, without limitation: (i) delivery of financial statements and other reports, (ii) compliance certificate, (iii) notices of default, litigation and governmental proceedings, (iv) compliance with laws and maintenance of permits and licenses, (v) payment of taxes, (vi) maintenance of insurance, (vii) no additional liens or other encumbrances on the assets subject to the Security (as described herein), (viii) no distributions nor dividends, (ix) no issuance of securities or debt, and (x) no change in business

 

	
Conditions Subsequent:

	
·Closing of Joint Venture scheduled during the week of January 9th

·Preparation and execution of Convertible Note documentation

 

  

  

  

 

GGCR Interim Funding Budget

 

	
Item

	 	
Priority

	 	 	
Cost

	 
	  	 	 	 	 	 	 
	
Immediate Funding for Toukhmanuk (GGCR Advance Funding)

	 	 	1	 	 	$	377,134	 
	
2012 Armenia and Partial NY Overhead (5 months w/zero revenue)

	 	 	1	 	 	 	1,250,000	 
	
ABB 2012 Debt Service (5 months)

	 	 	1	 	 	 	450,000	 
	
Reserve

	 	 	1	 	 	 	500,000	 
	
Priority 1 Items to Sustain Armenia Operations

	 	 	1	 	 	$	2,577,134	 
	  	 	 	 	 	 	 	 	 
	
24,000m of Drill core re-logging, re-sampling, 3D block model update

	 	 	1	 	 	$	211,779	 
	
Assaying / Re-assaying (maximum)

	 	 	1	 	 	 	111,505	 
	
NI-43101 Update + Conceptual Mining Study (remaining CSA Global cost)

	 	 	1	 	 	 	39,064	 
	
Behre Dolbear Outstanding Balance

	 	 	1	 	 	 	70,735	 
	
Priority 1 Items to Resolve Resource Problems

	 	 	1	 	 	$	433,083	 
	  	 	 	 	 	 	 	 	 
	
Lead IPO Counsel (Stikeman Elliot)

	 	 	1	 	 	$	300,000	 
	
Jersey Counsel (Ogiers)

	 	 	1	 	 	 	50,000	 
	
IPO Auditors (Grant Thornton)

	 	 	1	 	 	 	199,000	 
	
TSX Regulatory Costs

	 	 	1	 	 	 	210,000	 
	
Provincial Securities Commission

	 	 	1	 	 	 	30,000	 
	
Transfer Agent

	 	 	1	 	 	 	25,000	 
	
Printing, PR, Roadshow

	 	 	1	 	 	 	200,000	 
	
Priority 1 Items to Complete TSX IPO

	 	 	1	 	 	$	1,014,000	 
	  	 	 	 	 	 	 	 	 
	
Total Priority 1 Funding Needs through to IPO Completion

	 	 	 	 	 	$	4,024,217	 
	  	 	 	 	 	 	 	 	 
	
Existing Plant Upgrade

	 	 	2	 	 	$	535,875	 
	
Slimes Dam Retreatment

	 	 	2	 	 	 	932,820	 
	
Priority 2 Items to Improve Cash Flow Profile

	 	 	2	 	 	$	1,468,695	 
	  	 	 	 	 	 	 	 	 
	
Total Priority 2 Funding Needs to Improve Cash Flow Profile

	 	 	 	 	 	$	1,468,695	 
	  	 	 	 	 	 	 	 	 
	
Total GGCR Iterim Funding Budget

	 	 	 	 	 	$	5,492,912	 

 

  

  

  

 

IN WITNESS WHEREOF, GGCR, GGC and CRA have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.

 

GLOBAL GOLD CONSOLIDATED RESOURCES LIMITED, for itself and GGCRM

 

By:___________________________

Name: Van Krikorian

Title: Chairman

 

 

 

GLOBAL GOLD CORPORATION, for itself and as Guarantor

 

 

By:___________________________

Name: Van Krikorian

Title: Chairman and CEO

 

 

CONSOLIDATED RESOURCES ARMENIA

 

 

By:___________________________

Name: Jeffrey R. Marvinex10-1.htm

EXHIBIT 10.1

 

PROMISSORY NOTE

 

 

	$500,000	Orange County, California

January 17, 2012

FOR VALUE RECEIVED, the undersigned, Location Based Technologies, Inc., a Nevada corporation  (referred to herein as the “Borrower” or “Company”), hereby unconditionally promises to pay to the order of Brian Quinn its endorsees, successors and assigns (the “Holder” or “Lender”), at _________________________________ or such other address as the Lender may from time to time designate, the principal sum of FIVE HUNDRED THOUSAND DOLLARS ($500,000).

 

1.      Terms of Repayment and Conversion.  Principal of and interest on this Note shall be due in ninety (90) days from date of receiving the funds.  No prepayment penalty, however borrow shall repay full interest and principal amount regardless of repayment date.

 

a.           Upon the execution and delivery of this Note, the Holder shall disburse to the Borrower the sum of FIVE HUNDRED THOUSAND DOLLARS ($500,000), which is the principal amount. All amounts outstanding under this Note shall mature and become due and payable in full on April 16, 2012 (the "Maturity Date"), subject to any prior payment required by this Note.

 

b.           The Holder shall receive the stock certificate(s) within ten (10) business days following the date of deposit.  The certificate shall be issued to: Brian Quinn in the amount of 200,000 shares of Borrower’s common stock.

2.      Interest Rate.  This Note shall accrue interest on the principal from the date of this Note at a rate of twelve percent (12%) (the “Interest Rate”) or SIXTY THOUSAND DOLLARS ($60,000) for ninety (90) days.  All payments hereunder are to be applied first to the payment of accrued interest, and the remaining balance to the payment of principal.

3.      Events of Default.  If any of the events of default specified in this Section shall occur, Holder may, so long as such condition declare the entire principal and unpaid accrued interest hereon immediately due and payable, by notice in writing to the Company, this Note and any other obligations of the Borrower to the Lender, shall become due immediately, without demand or notice:

 

a.           Default in the payment of the principal or unpaid accrued interest of this Note when due and payable;

4.      Successors and Assigns: Assignment.  Except as otherwise expressly provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, assigns, heirs, executors and administrators of the parties hereto.  Nothing in this Note, express or implied, is intended to confer upon any party, other than the parties hereto and their successors and assigns, any rights, remedies, obligations or liabilities under or by reason of this Note, except as expressly provided herein.  The Company may not assign this Note or any of the rights or obligations referenced herein without the prior written consent of Holder.

  

  

  

 

5.      Governing Law.  This agreement is entered into in Orange County, California, and shall be construed in accordance with and governed by the laws of the State of California applicable to contracts made and to be performed in California.  Further, the parties agree that venue shall rest solely and exclusively in Orange County, California, and any challenge or objection thereto is hereby waived.

 

6.      Notices.  For the purpose of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given as of the date if delivered in person or by telecopy, on the next business day, if sent by a nationally recognized overnight courier service, and on the second business day if mailed by registered mail, return receipt requested, postage prepaid, and if addressed to the Company then at its principal place of business, or if addressed to the Holder, then the last known address on file with the Company.

 

 

 

	If to the Company:	Location Based Technologies, Inc. 

49 Discovery - 260

Irivne, CA 92618

Facsimile Number:  (714) 200-0287

E-mail:  Greg.Harrison@pocketfinder.com

	 	 
	If to Lender: 	
Brian Quinn

 

 

 

E-mail:

 

 

 

or, as to each party, at such other address as shall be designated by such party in a written notice to the other parties

7.      Heading; References.  The headings have been inserted for convenience only and are not to be considered when construing the provisions of this Agreement.

8.      Entire Agreement.  This Agreement constitutes the entire understanding between the parties hereto in respect of the terms of this Note by the Holder and by the Company, superseding all negotiations, prior discussions, prior written, implied and oral agreements, preliminary agreements and understandings with Company or any of its officers, employees or agents.

  

2

  

 

IN WITNESS WHEREOF, the Borrower has executed this Senior Secured Promissory Note as of the date first set forth above.

 

Borrower:

LOCATION BASED TECHNOLGIES, INC.

By:                                                                          

David M. Morse

CEO & Chairman

Date:

Lender:

By: ______________________________________

Printed Name: Brian Quinn

Date: _____________________________________

 

 

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