Document:

f8k02212ex10iv_attitude.htm

EXHIBIT 10.4

FIFTH AMENDMENT AND CONSENT AGREEMENT

This Fifth Amendment and Consent Agreement is made as of the 22nd day of February, 2012 (“Agreement”) among Attitude Drinks Inc., a Delaware corporation (the “Company”), and the signators hereto  who are “Subscribers” under certain Subscription Agreements with the Company dated October 23, 2007, January 8, 2008, September 29, 2008, January 27, 2009, March 30, 2009, July 15, 2010, January 21, 2011, March 17, 2011, and July 15, 2011, respectively (collectively “Subscription Agreements” – see Schedule 1).

WHEREAS, the Company is in need of additional funding for its business operations; and

WHEREAS, the Company is contemplating an additional investment of an aggregate of no minimum  and up to a maximum of $600,000 Purchase Price (“New Financing”) in secured promissory notes (“Notes”) and common stock purchase warrants (“Warrants”) of the Company; and

NOW THEREFORE, in consideration of the promises and mutual covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby consent and agree as follows:

1.           All capitalized terms herein shall have the meanings ascribed to them in the Transaction Documents (as defined in the Subscription Agreements).

2.           The undersigned consent to the Company completing the New Financing and to the amendment of the Security Agreement, and Guaranty to include the New Financing as part of the Obligations and are secured by the Collateral pursuant to the security interest granted pari passu among Subscribers and the investors in the New Financing and in connection therewith authorize the Collateral Agent to make such additional filings at the discretion of the Collateral Agent to memorialize such agreement.

3.           Annexed hereto is the proposed Amended Schedule A to the Security Agreement, Guaranty and Collateral Agent Agreement which includes the New Financing.

4.           The undersigned Subscribers to the Subscription Agreements waive the rights granted to them pursuant to Section 12(b), Right of First Refusal and the restrictions contained in Sections 9(p) Negative Covenants and 9(q) Seniority of the Subscription Agreements, all of the aforementioned only to the extent such rights relate to the New Financing. Each of the undersigned Subscribers to the Subscription Agreements waives the ratchet/reset benefit that such Subscriber is entitled to as a result of any Subscriber’s conversion of a Note or exercise of a Warrant to the extent such conversion or exercise would result in a conversion price or exercise price less than $0.02, provided however all Subscribers will get the ratchet/reset benefit to the $0.02 floor as a result of any such conversion or exercise.  This waiver will not apply to any other issuances by the Company.

5.           The undersigned Subscribers waive the Company’s Reservation obligation as described in Section 9(f) of the Subscription Agreements, Section 3.2.1(c)(D)(e) of the Notes to the extent such requirement is in excess of 100% required reservation of shares for conversion of principal and interest of the Notes as set forth on Schedule 5(d)  until such time as the Company either increases its authorized shares or effectuates a reverse split of its Common Stock, but in any event no later than June 1, 2012.  For purposes of clarification commencing June 2, 2012, the Company is required to have a number of shares of Common Stock equal to 150% of the amount of Common Stock to all Subscribers to be able to convert all of the Notes (including interest that would accrue therein through the Maturity Date (as defined in the Notes) and 100% of the amount of Warrant Shares issuable upon exercise of the Warrants.

 

  

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6.           All other terms of the Transaction Documents shall remain unamended and in full force and effect.

7.           This Agreement constitutes the entire agreement among the parties, and supersedes all prior and contemporaneous agreements and understandings of the parties in connection herewith.  No changes, modifications, terminations or waivers of any of the provisions hereof shall be binding unless in writing and signed by all of the parties thereto.

8.           Except as expressly modified pursuant to this Agreement, the terms of each Note remains unchanged and in full force and effect.

9.           This Agreement may be executed in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.  This Agreement may also be executed by either party hereto by facsimile signature, which shall be deemed to be an original signature of such party hereon.

[Signatures to Follow]

 

  

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IN WITNESS WHEREOF, the undersigned have executed and delivered this Agreement as of the date first written above.

"COMPANY"                                                                                                "THE COLLATERAL AGENT"

ATTITUDE DRINKS INC.                                                                            BARBARA R. MITTMAN

a Delaware corporation

By: _____________________________________                              _______________________________________

Its: _____________________________________

 

	
_________________________________________

	
_______________________________________

	
SMIVEL, LLC

	
MONARCH CAPITAL FUND LTD.

	
By: Joseph Smith, Partner

	  
	  	  
	
_________________________________________

	
_______________________________________

	
ALPHA CAPITAL ANSTALT

	
CMS CAPITAL

	  	  
	
_________________________________________

	
_______________________________________

	
WHALEHAVEN CAPITAL FUND LIMITED

	
MOMONA CAPITAL LLC

	  	  
	
_________________________________________

	
_______________________________________

	
CENTAURIAN FUND

	
NAOMI KLISSMAN

	  	  
	
_________________________________________

	
_______________________________________

	
SCHLOMO & ROCHEL RIFKIND

	
DAVID M. LAMPLOUGH

	  	  
	
_________________________________________

	
_______________________________________

	
PSM HOLDINGS

	
J. MAYA IRA

	  	  
	
_________________________________________

	
_______________________________________

	
EMMY CUTLER IRA

	
SAM BERKOWITZ

	  	  
	
_________________________________________

	
_______________________________________

	
J & N INVEST LLC

	
JOE & SUE MAYA

	  	  
	
_________________________________________

	
_______________________________________

	
LINDA R. IENNACO

	
SETH FARBMAN

	  	  
	
_________________________________________

	
_______________________________________

	
RAMSHEAD HOLDING LTD.

	  
	  	  
	  	
ESCROW AGENT

	  	  
	  	
________________________________________

	  	
GRUSHKO & MITTMAN, P.C.

 

  

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AMENDED SCHEDULE A TO SECURITY AGREEMENT

	
LENDERS AND ADDRESSES

	
SMIVEL, LLC

12642 SW 103 Court

Miami, FL 33176

Attn: Joseph Smith, Partner

Tel: (305) 233-3353

	
ALPHA CAPITAL ANSTALT

Pradafant 7

9490 Furstentums

Vaduz, Lichtenstein

Fax: 011-42-32323196

	
WHALEHAVEN CAPITAL FUND LIMITED

3rd Fl., 14 Par-La-Ville Rd.

Hamilton, Bermuda HM08

Fax: (201) 782-9327

	
MONARCH CAPITAL FUND LTD.

Harbour House, 2nd Floor

Waterfront Drive, Road Town

Tortola, BVI

Fax (284) 494-4771

	
CMS CAPITAL

9612 Van Nuys Blvd. #108

Panorama City, CA 91402

Fax: (818) 907-3372

	
MOMONA CAPITAL LLC

150 Central Park South, 2nd Floor

New York, NY 10019

Fax: (212) 586-8244

	
CENTAURIAN FUND

739 Palmer Avenue

Teaneck, NJ 07666

Fax:

	
NAOMI KLISSMAN

5/16 Katzenlson Street

Jerusalem, Israel 92621

Fax:

	
SAM BERKOWITZ

 

 

 

	
SCHLOMO & ROCHEL RIFKIND

Givat Shoshanna 12/3

Tzfut Israel

Fax: 972 4 6970443

 

  

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DAVID M. LAMPLOUGH

c/o NASA Services Limited

2 Poynings Road

Crawley RH11 0TW

United Kingdom

	
PSM HOLDINGS

c/o PHD Capital

5 Hanover Square #500

New York, NY 10004

Stephen J. Payne

Fax: (212) 269-3087

	
J. MAYA IRA

c/o PHD Capital

5 Hanover Square #500

New York, NY 10004

Joseph Maya

Fax: (212) 269-3087

	
EMMY CUTLER IRA

c/o PHD Capital

5 Hanover Square #500

New York, NY 10004

Emmy Cutler

Fax: (212) 269-3087

	
J & N INVEST LLC

124 East 8th Street

Lakewood, NJ 09701

Attn: Jeffrey Rubin

Fax: (732) 905-9049

	
JOE & SUE MAYA

8 Salem Lane

Westport, CT 06880-3721

	
LINDA R. IENNACO

57 West 75th Street, 4C

New York, NY 10023

Fax: (212) 873-9042

	
SETH FARBMAN

354 Eastwood Road

Woodmere, NY 11598

Fax: (212) 730-4306

	
RAMSHEAD HOLDING LTD.

57 / 63 Line Wall Road

Gibraltar

Attn: Lawrence Abrams

  

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Schedule 1 – Outstanding Convertible Notes Payable and Warrants by Note Holder

	
ANALYSIS OF CONVERTIBLE NOTE PAYABLE HOLDINGS

	 	 	 	 	 	 	 	 	 	 
	
BY SUBSCRIBERS AT 1/18/12

	 	 	 	 	 	 	 	 	 	 	 	 
	  	 	 	 	 	 	 	 	 	 	 	 	 
	  	 	 	 	 	 	 	 	
(b)

	 	 	 	 
	  	 	
Convertible

	 	 	
$

	 	 	
# of Class A

	 	 	
$

	 
	  	 	
Notes Payable

	 	 	
(a)

	 	 	
Warrants

	 	 	
Warrant

	 
	  	 	
Outstanding

	 	 	
Conversion

	 	 	
Held by

	 	 	
Exercise

	 
	
Name of Note Holder

	 	
$ Amount

	 	 	
Price Cap

	 	 	
Note Holders

	 	 	
Price

	 
	  	 	 	 	 	 	 	 	 	 	 	 	 
	
Alpha Capital Anstaldt

	 	$	2,370,488	 	 	$	0.02	 	 	 	33,601,528	 	 	$	0.02	 
	
Whalehaven Capital Fund Limited

	 	$	1,093,412	 	 	$	0.02	 	 	 	58,194,749	 	 	$	0.02	 
	
Monarch Capital Fund Ltd.

	 	$	-	 	 	$	0.02	 	 	 	303,003	 	 	$	0.02	 
	
Smivell LLC

	 	$	4,000	 	 	$	0.02	 	 	 	151,052	 	 	$	0.02	 
	
Momona Capital LLC

	 	$	12,478	 	 	$	0.02	 	 	 	-	 	 	$	-	 
	
CMS Capital

	 	$	18,852	 	 	$	0.02	 	 	 	-	 	 	$	-	 
	
Centaurian Fund

	 	$	171,931	 	 	$	0.02	 	 	 	511,509	 	 	$	0.02	 
	
Naomi Klissman

	 	$	163,000	 	 	$	0.02	 	 	 	3,333,333	 	 	$	0.02	 
	
PHD Capital

	 	$	-	 	 	$	0.02	 	 	 	3,973,510	 	 	$	0.02	 
	
Sam Berkowitz

	 	$	26,116	 	 	$	0.02	 	 	 	-	 	 	$	-	 
	
Schlomo & Rochel Rifking

	 	$	317,011	 	 	$	0.02	 	 	 	16,336,317	 	 	$	0.02	 
	
David Lamplough

	 	$	39,263	 	 	$	0.02	 	 	 	-	 	 	$	-	 
	
PSM Holdings

	 	$	20,980	 	 	$	0.02	 	 	 	1,278,772	 	 	$	0.02	 
	
J. Maya IRA

	 	$	40,792	 	 	$	0.02	 	 	 	-	 	 	$	-	 
	
Emmy Cutler

	 	$	21,266	 	 	$	0.02	 	 	 	-	 	 	$	-	 
	
J&N Invest LLC

	 	$	199,653	 	 	$	0.02	 	 	 	14,238,411	 	 	$	0.02	 
	
Joe & Sue Maya

	 	$	50,000	 	 	$	0.02	 	 	 	1,000,000	 	 	$	0.02	 
	
Linda Iennaco

	 	$	27,725	 	 	$	0.02	 	 	 	1,986,755	 	 	$	0.02	 
	
Seth Farbman

	 	$	20,206	 	 	$	0.02	 	 	 	1,655,629	 	 	$	0.02	 
	
Ramshead Holding LTD

	 	$	80,000	 	 	$	0.02	 	 	 	4,486,755	 	 	$	0.02	 
	
Jody Eisenman

	 	$	230,844	 	 	$	0.02	 	 	 	22,500,000	 	 	$	0.02	 
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
Total

	 	$	4,908,017	 	 	 	 	 	 	 	163,551,323	 	 	 	 	 
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
(a) Conversion price is subject to the discount and the number of trading days preceding a conversion date as provided in each convertible note agreement but in no event greater than $.02.

	 
	 	 	 	 	 	 	 	 	 	 
	
(b) Once certain Class A Warrants are exercised, 231,818 Class B warrants can then be exercised.

	 	 	 	 	 
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

6f8k02212ex10v_attitude.htm

EXHIBIT 10.5

 

 

ESCROW AGREEMENT

 

 

           This Agreement is dated as of the 22nd day of February, 2012 among Attitude Drinks, Inc., a Delaware corporation (the “Company”), the subscribers listed on Schedule 1 hereto (“Subscribers”), and Grushko & Mittman, P.C. (the “Escrow Agent”):

 

W I T N E S S E T H:

 

           WHEREAS, the Company and Subscribers have entered into a Subscription Agreement calling for the sale by the Company to the Subscribers of  secured convertible Notes and Warrants for an aggregate purchase price of no minimum dollar amount and up to a maximum of $1,000,000; and

 

           WHEREAS, the parties hereto require the Company to deliver the Notes and Warrants against payment therefor, with such Notes and the Escrowed Funds to be delivered to the Escrow Agent, along with the other documents, instruments and payments hereinafter described, to be held in escrow and released by the Escrow Agent in accordance with the terms and conditions of this Agreement; and

 

           WHEREAS, the Escrow Agent is willing to serve as escrow agent pursuant to the terms and conditions of this Agreement;

 

           NOW THEREFORE, the parties agree as follows:

 

ARTICLE I

 

INTERPRETATION

 

           1.1.           Definitions.  Capitalized terms used and not otherwise defined herein that are defined in the Subscription Agreement shall have the meanings given to such terms in the Subscription Agreement.  Whenever used in this Agreement, the following terms shall have the following respective meanings:

 

§ “Agreement” means this Agreement and all amendments made hereto and thereto by written agreement between the parties;

 

§ “Broker” shall have the meaning set forth in Section 8(a) and on Schedule 8 of the Subscription Agreement;“

 

§ “Closing Date” shall have the meaning set forth in Section 1 of the Subscription Agreement;

 

§  “Escrowed Payment” means an aggregate cash payment of no minumum and up to a maximum of $1,000,000;

 

§  “Legal Opinion” means the original signed legal opinion referred to in Section 6 of the Subscription Agreement;

 

§ “Note” shall have the meaning set forth in the second recital to the Subscription Agreement;

 

  

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§ “Placement Agent” shall have the meaning set forth in Section 8(a) and on Schedule 8 of the Subscription Agreement;

 

§ “Placement Agent’s Fee” shall have the meaning set forth in Section 8(a) and on Schedule 8 of the Subscription Agreement;

 

§ “Principal Amount” shall mean an aggregate of no minumum up to a maximum of $1,000,000;

 

§ “Subscriber Legal Fees” shall have the meaning set forth in Section 8(b) of the Subscription Agreement;

 

§ “Subscription Agreement” means the Subscription Agreement (and the exhibits and schedules thereto) entered into or to be entered into by the Company and Subscribers in reference to the sale and purchase of the Notes and Warrants;

 

§ “Warrants” shall have the meaning set forth in Section 2(b) of the Subscription Agreement;

 

§ Collectively, the Legal Opinion, Notes, Warrants, and Subscription Agreement signed and executed by all signators thereto other than the Subscribers, Placement Agent’s Fee and Subscriber Legal Fees and are referred to as “Company Documents”; and

 

§ Collectively, the Escrowed Payment and the Subscribers executed Subscription Agreement are referred to as “Subscriber Documents.”

 

           1.2.           Entire Agreement.  This Agreement along with the Company Documents and the Subscriber Documents to which the Subscriber and the Company or Subsidiary are a party constitute the entire agreement between the parties hereto pertaining to the Company Documents and Subscriber Documents and supersedes all prior agreements, understandings, negotiations and discussions, whether oral or written, of the parties.  There are no warranties, representations and other agreements made by the parties in connection with the subject matter hereof, except as specifically set forth in this Agreement, the Company Documents and the Subscriber Documents.

 

           1.3.           Extended Meanings.  In this Agreement words importing the singular number include the plural and vice versa; words importing the masculine gender include the feminine and neuter genders.  The word “person” includes an individual, body corporate, partnership, trustee or trust or unincorporated association, executor, administrator or legal representative.

 

           1.4.           Waivers and Amendments.  This Agreement may be amended, modified, superseded, cancelled, renewed or extended, and the terms and conditions hereof may be waived, only by a written instrument signed by all parties, or, in the case of a waiver, by the party waiving compliance.  Except as expressly stated herein, no delay on the part of any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of any party of any right, power or privilege hereunder preclude any other or future exercise of any other right, power or privilege hereunder.

 

           1.5.           Headings.  The division of this Agreement into articles, sections, subsections and paragraphs and the insertion of headings are for convenience of reference only and shall not affect the construction or interpretation of this Agreement.

 

  

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           1.6.           Law Governing this Agreement.  This Agreement shall be governed by and construed in accordance with the laws of the State of New York without regard to conflicts of laws principles that would result in the application of the substantive laws of another jurisdiction.  Any action brought by either party against the other concerning the transactions contemplated by this Agreement shall be brought only in the state courts of New York or in the federal courts located in the state of New York.  Both parties and the individuals executing this Agreement and other agreements on behalf of the Company agree to submit to the jurisdiction of such courts and waive trial by jury.  The prevailing party (which shall be the party which receives an award most closely resembling the remedy or action sought) shall be entitled to recover from the other party its reasonable attorney’s fees and costs.  In the event that any provision of this Agreement or any other agreement delivered in connection herewith is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law.  Any such provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of any agreement.

 

           1.7.           Specific Enforcement, Consent to Jurisdiction.  The Company and Subscribers acknowledge and agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached.  It is accordingly agreed that the parties shall be entitled to an injuction or injunctions to prevent or cure breaches of the provisions of this Agreement and to enforce specifically the terms and provisions hereof or thereof, this being in addition to any other remedy to which any of them may be entitled by law or equity.  Subject to Section 1.6 hereof, each of the Company and Subscribers hereby waives, and agrees not to assert in any such suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such court, that the suit, action or proceeding is brought in an inconvenient forum or that the venue of the suit, action or proceeding is improper.  Nothing in this Section shall affect or limit any right to serve process in any other manner permitted by law.

 

ARTICLE II

 

DELIVERIES TO THE ESCROW AGENT

 

2.1.           Company Deliveries.  On or before the Closing Date, the Company shall execute and deliver the Company Documents to the Escrow Agent.

 

2.2.           Subscriber Deliveries.  On or before the Closing Date, Subscribers shall execute and deliver the Subscription Agreements and shall deliver the Escrowed Payment in cash, to the Escrow Agent.  The Escrowed Payment will be delivered pursuant to the following wire transfer instructions:

Citibank, N.A.

1155 6th Avenue

New York, NY 10036

ABA Number: 0210-00089

For Credit to: Grushko & Mittman, IOLA Trust Account

Account Number: 9997242837

 

           2.3.           Intention to Create Escrow Over Company Documents and Subscriber Documents.  The Subscribers and Company intend that the Company Documents and Subscriber Documents shall be held in escrow by the Escrow Agent pursuant to this Agreement for their benefit as set forth herein.

 

  

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           2.4.           Escrow Agent to Deliver Company Documents and Subscriber Documents.  The Escrow Agent shall hold and release the Company Documents and Subscriber Documents only in accordance with the terms and conditions of this Agreement.

 

ARTICLE III

 

RELEASE OF COMPANY DOCUMENTS AND SUBSCRIBER DOCUMENTS

 

           3.1.           Release of Escrow.  Subject to the provisions of Section 4.2, the Escrow Agent shall release the Company Documents and Subscriber Documents as follows:

 

                      (a)           On the Closing Date, the Escrow Agent will simultaneously release the Company Documents to the Subscribers and release the Subscriber Documents to the Company, except that:

 

(i)           Subscriber Legal Fees will be released directly to the Subscriber’s attorneys. Company Legal Fees will be released directly to Company’s attorneys; and

 

(ii)           the Placement Agent’s Fee will be released to the Broker/Placement Agent as described on Schedule 8 to the Subscription Agreement.

 

(b)           Notwithstanding the above, upon receipt by the Escrow Agent of joint written instructions (“Joint Instructions”) signed by the Company and the Subscribers, it shall deliver the Company Documents and Subscriber Documents in accordance with the terms of the Joint Instructions.

 

                      (c)           Anything herein to the contrary notwithstanding, upon receipt by the Escrow Agent of a final and non-appealable judgment, order, decree or award of a court of competent jurisdiction (a “Court Order”), the Escrow Agent shall deliver the Company Documents and Subscriber Documents in accordance with the Court Order.  Any Court Order shall be accompanied by an opinion of counsel for the party presenting the Court Order to the Escrow Agent (which opinion shall be satisfactory to the Escrow Agent) to the effect that the court issuing the Court Order has competent jurisdiction and that the Court Order is final and non-appealable.

3.2.           Acknowledgement of Company and Subscriber; Disputes.  The Company and the Subscribers acknowledge that the only terms and conditions upon which the Company Documents and Subscriber Documents are to be released are set forth in Sections 3 and 4 of this Agreement.  The Company and the Subscribers reaffirm their agreement to abide by the terms and conditions of this Agreement with respect to the release of the Company Documents and Subscriber Documents.  Any dispute with respect to the release of the Company Documents and Subscriber Documents shall be resolved pursuant to Section 4.2 or by agreement between the Company and Subscribers.

ARTICLE IV

 

CONCERNING THE ESCROW AGENT

4.1.           Duties and Responsibilities of the Escrow Agent.  The Escrow Agent’s duties and responsibilities shall be subject to the following terms and conditions:

 

  

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(a)           The Subscribers and Company acknowledge and agree that the Escrow Agent (i) shall not be responsible for or bound by, and shall not be required to inquire into whether either the Subscribers or Company is entitled to receipt of the Company Documents and Subscriber Documents pursuant to any other agreement or otherwise; (ii) shall be obligated only for the performance of such duties as are specifically assumed by the Escrow Agent pursuant to this Agreement; (iii) may rely on and shall be protected in acting or refraining from acting upon any written notice, instruction, instrument, statement, request or document furnished to it hereunder and believed by the Escrow Agent in good faith to be genuine and to have been signed or presented by the proper person or party, without being required to determine the authenticity or correctness of any fact stated therein or the propriety or validity or the service thereof; (iv) may assume that any person believed by the Escrow Agent in good faith to be authorized to give notice or make any statement or execute any document in connection with the provisions hereof is so authorized; (v) shall not be under any duty to give the property held by Escrow Agent hereunder any greater degree of care than Escrow Agent gives its own similar property; and (vi) may consult counsel satisfactory to Escrow Agent, the opinion of such counsel to be full and complete authorization and protection in respect of any action taken, suffered or omitted by Escrow Agent hereunder in good faith and in accordance with the opinion of such counsel.

 

(b)           The Subscribers and Company acknowledge that the Escrow Agent is acting solely as a stakeholder at their request and that the Escrow Agent shall not be liable for any action taken by Escrow Agent in good faith and believed by Escrow Agent to be authorized or within the rights or powers conferred upon Escrow Agent by this Agreement.  The Subscribers and Company, jointly and severally, agree to indemnify and hold harmless the Escrow Agent and any of Escrow Agent’s partners, employees, agents and representatives for any action taken or omitted to be taken by Escrow Agent or any of them hereunder, including the fees of outside counsel and other costs and expenses of defending itself against any claim or liability under this Agreement, except in the case of gross negligence or willful misconduct on Escrow Agent’s part committed in its capacity as Escrow Agent under this Agreement.  The Escrow Agent shall owe a duty only to the Subscribers and Company under this Agreement and to no other person.

 

(c)           The Subscribers and Company jointly and severally agree to reimburse the Escrow Agent for outside counsel fees, to the extent authorized hereunder and incurred in connection with the performance of its duties and responsibilities hereunder.

 

(d)           The Escrow Agent may at any time resign as Escrow Agent hereunder by giving five (5) days prior written notice of resignation to the Subscribers and the Company.  Prior to the effective date of the resignation as specified in such notice, the Subscribers and Company will issue to the Escrow Agent a Joint Instruction authorizing delivery of the Company Documents and Subscriber Documents to a substitute Escrow Agent selected by the Subscribers and Company.  If no successor Escrow Agent is named by the Subscribers and Company, the Escrow Agent may apply to a court of competent jurisdiction in the State of New York for appointment of a successor Escrow Agent, and to deposit the Company Documents and Subscriber Documents with the clerk of any such court.

 

(e)           Other than in connection with the Subscriber Legal Fees, the Escrow Agent does not have and will not have any interest in the Company Documents and Subscriber Documents, but is serving only as escrow agent, having only possession thereof.  The Escrow Agent shall not be liable for any loss resulting from the making or retention of any investment in accordance with this Escrow Agreement.

 

(f)           This Agreement sets forth exclusively the duties of the Escrow Agent with respect to any and all matters pertinent thereto and no implied duties or obligations shall be read into this Agreement.

 

(g)           The Escrow Agent shall be permitted to act as counsel for the Subscribers in any dispute as to the disposition of the Company Documents and Subscriber Documents, in any other dispute between the Subscribers and Company, whether or not the Escrow Agent is then holding the Company Documents and Subscriber Documents and continues to act as the Escrow Agent hereunder.

 

  

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(h)           The provisions of this Section 4.1 shall survive the resignation of the Escrow Agent or the termination of this Agreement.

 

           4.2.           Dispute Resolution: Judgments.  Resolution of disputes arising under this Agreement shall be subject to the following terms and conditions:

 

(a)           If any dispute shall arise with respect to the delivery, ownership, right of possession or disposition of the Company Documents and Subscriber Documents, or if the Escrow Agent shall in good faith be uncertain as to its duties or rights hereunder, the Escrow Agent shall be authorized, without liability to anyone, to (i) refrain from taking any action other than to continue to hold the Company Documents and Subscriber Documents pending receipt of a Joint Instruction from the Subscribers and Company, or (ii) deposit the Company Documents and Subscriber Documents with any court of competent jurisdiction in the State of New York, in which event the Escrow Agent shall give written notice thereof to the Subscribers and the Company and shall thereupon be relieved and discharged from all further obligations pursuant to this Agreement.  The Escrow Agent may, but shall be under no duty to, institute or defend any legal proceedings which relate to the Company Documents and Subscriber Documents.  The Escrow Agent shall have the right to retain counsel if it becomes involved in any disagreement, dispute or litigation on account of this Agreement or otherwise determines that it is necessary to consult counsel.

 

(b)           The Escrow Agent is hereby expressly authorized to comply with and obey any Court Order.  In case the Escrow Agent obeys or complies with a Court Order, the Escrow Agent shall not be liable to the Subscribers and Company or to any other person, firm, corporation or entity by reason of such compliance.

 

ARTICLE V

 

GENERAL MATTERS

 

           5.1.           Termination.  This escrow shall terminate upon the release of all of the Company Documents and Subscriber Documents or at any time upon the agreement in writing of the Subscribers and Company.

 

           5.2.           Notices.   All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile, addressed as set forth below or to such other address as such party shall have specified most recently by written notice.  Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur.  The addresses for such communications shall be:

 

  

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(a)           If to the Company, to:

Attitude Drinks Inc.

10415 Riverside Drive, Suite 101

Palm Beach Gardens, FL 33410

Attn: Roy Warren, CEO and President

Fax: (561) 799-5039

With a copy by facsimile only to:

Weed & Co., LLP

4695 MacArthur Court, Suite 1430

Newport Beach, CA 92660

Attn: Rick Weed, Esq.

Fax: (949) 475-9087

(b)           If to the Subscribers: to the addresses set forth on Schedule 1

With copies by facsimile only to (which shall not constitute notice):

 

Grushko & Mittman, P.C.

515 Rockaway Avenue

Valley Stream, New York 11581

Fax: 212-697-3575

Ellenoff Grossman & Schole LLP

150 East 42nd Street, 11th Floor

New York, NY 10017

Attn: Stuart Neuhauser, Esq.

Fax: (212) 370-7889

 

	
(c)

	
If to the Escrow Agent, to:

 

Grushko & Mittman, P.C.

515 Rockaway Avenue

Valley Stream, New York 11581

Fax: 212-697-3575

 

or to such other address as any of them shall give to the others by notice made pursuant to this Section 5.2.

 

           5.3.           Interest.  The Escrowed Payment shall not be held in an interest bearing account nor will interest be payable in connection therewith.  In the event the Escrowed Payment is deposited in an interest bearing account, the Subscribers shall be entitled to receive any accrued interest thereon, but only if the Escrow Agent receives from the Subscriber the Subscribers’ United States taxpayer identification number and other requested information and forms.

 

           5.4.           Assignment; Binding Agreement.  Neither this Agreement nor any right or obligation hereunder shall be assignable by any party without the prior written consent of the other parties hereto.  This Agreement shall enure to the benefit of and be binding upon the parties hereto and their respective legal representatives, successors and assigns.

 

  

7

  

 

           5.5.           Invalidity.  In the event that any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal, or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be in any way impaired thereby, it being intended that all of the rights and privileges of the parties hereto shall be enforceable to the fullest extent permitted by law.

 

           5.6.           Counterparts/Execution.  This Agreement may be executed in any number of counterparts and by different signatories hereto on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute but one and the same instrument.  This Agreement may be executed by facsimile transmission and delivered by facsimile transmission.

 

           5.7.           Agreement.  Each of the undersigned states that he has read the foregoing Escrow Agreement and understands and agrees to it.

 

  

8

  

 

IN WITNESS WHEREOF, the undersigned have executed and delivered this Escrow Agreement, as of the date first written above.

“COMPANY”

ATTITUDE DRINKS, INC.

a Delaware corporation

By: /S/ Roy Warren

Roy Warren

President & CEO

ESCROW AGENT:

 

GRUSHKO & MITTMAN, P.C.

By: /S/ GRUSHKO & MITTMAN, P.C.

Name:

 

	 
SUBSCRIBERS:

	 	 
	 	 
	 By: ___________________________________ 	 By: __________________________________
	
Name:

Title: 

	
Name:

Title:

 

	By: ___________________________________ 	 By: __________________________________
	
Name:

Title: 

	
Name:

Title:

 

	By: ___________________________________ 	 By: __________________________________
	
Name:

Title: 

	
Name:

Title:

 

  

9

  

 

SCHEDULE 1

(SUBSCRIBERS)

	
SUBSCRIBER

	
PURCHASE PRICE AND PRINCIPAL AMOUNT

	
WARRANTS

	
ALPHA CAPITAL ANSTALT

Pradafant 7

9490 Furstentums

Vaduz, Lichtenstein

Attn: Konrad Ackermann

Fax: 011-42-32323196

	
$175,000.00

(Bridge Notes Roll-in)

	
8,750,000

	
WHALEHAVEN CAPITAL FUND LIMITED

560 Sylvan Avenue, 3rd Fl.

Englewood Cliffs, NJ 07632

Attn: Michael Finkelstein

Fax: (201) 408-5125

	
$50,000.00

 

	
2,500,000

	
SHLOMO & ROCHEL RIFKIND

Givat Shoshanna 12/3

Tzfut Israel

Fax: 972 4 6970443

	
$100,000.00

	
5,000,000

	
EMMY CUTLER

c/o PHD Capital

5 Hanover Square

New York, NY 10004

Ph: (212) 269-3087

	
$25,000.00

	
1,250,000

	
J & N INVEST LLC

124 East 8th Street

Lakewood, NJ 08701

Jeffrey Rubin

Fax: (732) 905-9049

	
$200,000.00

	
10,000,000

	
RAMSHEAD LIMITED

P. O. Box 5779

Englewood, NJ

Lawrence Abrams

	
$100,000.00

	
5,000,000

	
NAOMIE KLISSMAN

P. O. Box 5779

Englewood, NJ

Lawrence Abrams

	
$100,000.00

	
5,000,000

	
SETH FARBMAN

354 Eastwood Road

Woodmere, NY 11598

	
$50,000.00

	
2,500,000

	
LOUIS GOLDBERG

200 Fountain Street   E301

New Haven, CT 06515

	
$50,000.00

 

	
2,500,000

	
DAVID M. LAMPLOUGH

2 Poynings Road, 1 Field

Crawley, West Sussex

RH11 0TW

United Kingdom

	
$50,000.00

	
2,500,000

	
JAN VERYKE

Vallenlaan 29

2900 Schotan, Belgium

	
$25,000.00

	
1,250,000

	
PSM HOLDINGS

c/o PHD Capital

5 Hanover Square # 500

New York, NY 10004

Fax: (212) 269-3087

	
$25,000.00

	
1,250,000

	
JOSEPH & SUE MAYA

8 Salem Lane

Westport, CT 06880-3721

	
$50,000.00

	
2,500,000

	
TOTALS

	
$1,000,000.00

	
50,000,000

TOTAL SUBSCRIPTIONS = $1,000,000.00

NOTES TO BE TENDERED IN LIEU OF CASH FOR SUBSCRIPTION: $175,000.00

CASH ESCROW RELEASE: $825,000.00

 

 

10

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