Attached files
| file | filename |
|---|---|
| 10-K - Tix CORP | v177339_10k.htm |
| EX-23 - Tix CORP | v177339_ex23.htm |
| EX-21 - Tix CORP | v177339_ex21.htm |
| EX-32.2 - Tix CORP | v177339_ex32-2.htm |
| EX-31.1 - Tix CORP | v177339_ex31-1.htm |
| EX-31.2 - Tix CORP | v177339_ex31-2.htm |
| EX-32.1 - Tix CORP | v177339_ex32-1.htm |
NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS NOTE NOR THE
SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED
OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR
THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION
OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY
ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS
SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.
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Principal
Amount: $1,000,000
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Issue
Date: February 10, 2010
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SECURED CONVERTIBLE
NOTE
FOR VALUE
RECEIVED, Tix Corporation, a Delaware corporation (hereinafter called the
“Company”), hereby promises to pay to Metin Durmus, with an address of 8447
Turtle Creek Circle, Las Vegas, Nevada 89113 (the “Holder”), the sum of One
Million Dollars ($1,000,000), without interest, on August 10, 2010 (the
“Maturity Date”), if not paid sooner.
This Note
has been entered into pursuant to the terms of an Asset Purchase Agreement dated
as of the date hereof between the Company, the Holder and All Access
Entertainment, LLC (the “Purchase Agreement”). Unless otherwise
separately defined herein, all capitalized terms used in this Note shall have
the same meaning as is set forth in the Purchase Agreement. The
following terms shall apply to this Note:
ARTICLE
I
CONVERSION
RIGHTS
The
Holder shall have the right to convert the entire principal amount under this
Note thereon into shares of the Company’s Common Stock as set forth
below.
1.1 Voluntary Conversion into
the Company’s Common Stock.
(a)
The Holder shall have the right on the Maturity Date to
convert any outstanding and unpaid principal portion of this Note, at the
election of the Holder (the date of giving of such notice of conversion being a
“Conversion Date”) into fully paid and nonassessable shares of Common Stock as
such stock exists on the date of issuance of this Note, or any shares of capital
stock of the Company into which such Common Stock shall hereafter be changed or
reclassified, at the conversion price as defined in Section 1.1(b) hereof (the
“Conversion Price”), determined as provided herein. Upon delivery to
the Company of a completed Notice of Conversion, a form of which is annexed
hereto, the Company shall issue and deliver to the Holder within three (3)
business days after the Conversion Date (such third day being the “Delivery
Date”) that number of shares of Common Stock for the portion of the Note
converted in accordance with the foregoing. The number of shares of
Common Stock to be issued upon each conversion of this Note shall be determined
by dividing that portion of the principal of the Note to be converted, by the
Conversion Price.
(b)
Subject to adjustment as provided for in Section 1.1(c)
hereof, the Conversion Price per share of Common Stock shall be the daily
average closing sale price of the Company’s Common Stock as reported on the
NASDAQ Capital Market for the thirty day period prior to the Conversion Date,
but in no event less than $3.00 (“Conversion Price”).
(c)
The Conversion Price and the number and kind of shares or
other securities to be issued upon conversion of this Note, shall be subject to
adjustment from time to time upon the happening of certain events while this
conversion right remains outstanding, as follows:
A. Merger, Sale of Assets,
etc. If the Company at any time shall consolidate with or
merge into or sell or convey all or substantially all its assets to any other
corporation, this Note, as to the unpaid principal portion thereof, shall
thereafter be deemed to evidence the right to purchase such number and kind of
shares or other securities and property as would have been issuable or
distributable on account of such consolidation, merger, sale or conveyance, upon
or with respect to the securities subject to the conversion or purchase right
immediately prior to such consolidation, merger, sale or
conveyance. The foregoing provision shall similarly apply to
successive transactions of a similar nature by any such successor or
purchaser. Without limiting the generality of the foregoing, the
anti-dilution provisions of this Section shall apply to such securities of such
successor or purchaser or surviving entity of the surviving corporation after
any such consolidation, merger, sale or conveyance.
B. Reclassification,
etc. If the Company at any time shall, by reclassification or
otherwise, change the Common Stock into the same or a different number of
securities of any class or classes of the Company’s capital stock that may be
issued or outstanding, this Note, as to the unpaid principal amount thereof and
accrued interest thereon, shall thereafter be deemed to evidence the right to
purchase an adjusted number of such securities and kind of securities as would
have been issuable as the result of such change with respect to the shares of
Common Stock subject to the conversion of this Note immediately prior to such
reclassification or other change.
C. Stock Splits, Combinations
and Dividends. If the shares of Common Stock are subdivided or
combined into a greater or smaller number of shares of Common Stock, or if a
dividend is paid on the Common Stock in shares of Common Stock, the Conversion
Price shall be proportionately reduced in case of subdivision of shares or stock
dividend or proportionately increased in the case of combination of shares, in
each such case by the ratio which the total number of shares of Common Stock
outstanding immediately after such event bears to the total number of shares of
Common Stock outstanding immediately prior to such event.
(d) Whenever
the Conversion Price is adjusted pursuant to Section 1.1(c) above, the Company
shall promptly provide notice to the Holder setting forth the Conversion Price
after such adjustment and setting forth a statement of the facts requiring such
adjustment.
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(e)
The Company will reserve from its authorized and unissued
shares of Common Stock, the number of shares of Common Stock during the time
periods and in the amounts described in the Subscription
Agreement. The Company represents that upon issuance, such shares of
Common Stock will be duly and validly issued, fully paid and
non-assessable. The Company agrees that its issuance of this Note
shall constitute full authority to its officers, agents, and transfer agents who
are charged with the duty of executing and issuing stock certificates to execute
and issue the necessary certificates for shares of the Company’s Common Stock
upon the conversion of this Note.
1.2 No Fractional
Shares. No fractional shares of Common Stock shall be issued
upon conversion of this Note, but an adjustment in cash will be made, in respect
of any fraction of a share (which will be valued based on the Conversion Price)
which would otherwise be issuable upon the surrender of this Note for conversion
and a check in the amount of the value of such fractional share shall be
delivered to the Holder.
1.3 Method of
Conversion. This Note may be converted by the Holder in whole
or in part as described in Section 1.1(a) hereof. Upon partial
conversion of this Note, a new Note containing the same date and provisions of
this Note shall, at the request of the Holder, be issued by the Company to the
Holder for the principal balance of this Note and interest which shall not have
been converted or paid.
ARTICLE
II
RIGHT TO
OFFSET
(a)
The Company shall have the right to offset against any amount
payable hereunder the amount of any Loss of the Company relating to the failure
of Holder to pay payables (the “Offset Amount”) after taking into account any
Deductible Amount provided that the Offset Amount shall not exceed
$500,000.
(b)
In the event the Company determines to
offset the Offset Amount, the Company shall deliver a notice (the “Notice”) to
Holder setting forth in reasonable detail a description of the Offset Amount,
the basis for the offset including the nature of the inaccuracy in or breach of
representation, warranty, covenant or agreement of Holder or Seller to which
such Losses relate. Upon delivery of the Notice, the Company shall,
subject to paragraph (c) below, be entitled and authorized to withhold payment
to Holder for the Offset Amount, and shall deposit the Offset Amount with an
unrelated third party designated by the Company to hold the Offset Amount in
escrow pending resolution of the matter as set forth below.
(c)
Within thirty (30) days after the delivery
of the Notice to Holder, Holder may notify (the “Response Notice”) the Company
either that Holder agrees to the Offset Amount as set forth in the Notice or
disputes all, or any portion of, the Offset Amount claimed in the
Notice. If no Response Notice has been delivered to the Company
before the expiration of such thirty (30) day period, Holder shall be deemed to
have agreed that all of the Offset Amount set forth in the Notice may be applied
to reduce the amount payable under this Note and such amount shall be released
from escrow and delivered to the Company. If the Response Notice is
delivered to the Company before the expiration of such thirty (30) day period
and disputes a portion, but not all, of the claimed Offset Amount, then Holder
shall be deemed to have agreed that such undisputed amounts may likewise be
applied to reduce the amount payable under this Note and the undisputed amount
shall be released from escrow and be delivered to the Company.
3
(d)
If Holder shall have timely delivered a Response Notice to the Company disputing
any amounts claimed in the Notice, Holder and the Company will attempt in good
faith to agree upon the rights of the respective parties with respect to the
disputed amount. If the parties fail to reach such an agreement,
either Holder or the Company may make a written demand upon the other for formal
resolution of the dispute and specifying the scope of the dispute. As
soon as practicable, and in any event within sixty (60) days after such written
notification, the parties and their respective representatives shall meet for
one day with an impartial mediator, mutually agreed upon by Holder and the
Company for purposes of reaching an agreement on a dispute resolution
alternative other than litigation. If an alternative method of
dispute resolution is not agreed upon as a result of the one-day mediation, the
parties may thereafter exercise any and all available rights and
remedies. With respect to the one-day of mediation and any other
mediation, the parties shall cooperate with one another in selecting a mediator
and in scheduling mediation proceedings, and shall act in good faith in such
mediation. Holder and the Company shall bear equally the costs of
mediation.
ARTICLE
III
EVENT OF
DEFAULT
The
occurrence of any of the following events of default (“Event of Default”) shall,
at the option of the Holder hereof, make all sums of principal and accrued
interest then remaining unpaid hereon and all other amounts payable hereunder
immediately due and payable, upon demand, without presentment or grace period,
all of which hereby are expressly waived, except as set forth
below:
3.1 Failure to Pay
Principal. The Company fails to pay any principal or other sum
due under this Note when due.
3.2 Failure to Deliver Common
Stock or Replacement Note. The Company’s failure to deliver
Common Stock to the Holder pursuant to and in the form required by this
Note.
3.3 Voluntary
Bankruptcy. The institution by the Company of proceedings to
be adjudicated as bankrupt or insolvent, or the consent by it to institution of
bankruptcy or insolvency proceedings against it or the filing by it of a
petition or answer or consent seeking reorganization or release under the
federal Bankruptcy Act, or any other applicable federal or state law, or the
consent by it to the filing of any such petition or the appointment of a
receiver, liquidator, assignee, trustee or other similar official of the
Company, or of any substantial part of its property, or the making by it of an
assignment for the benefit of creditors, or the taking of corporate action by
the Company in furtherance of any such action.
4
3.4 Involuntary
Bankruptcy. If, within sixty (60) days after the commencement
of an action against the Company, without the consent or acquiescence of the
Company (and service of process in connection therewith on the Company) seeking
any bankruptcy, insolvency, reorganization, liquidation, dissolution or similar
relief under any present or future statute, law or regulation, such action shall
not have been resolved in favor of the Company or all orders or proceedings
thereunder affecting the operations or the business of the Company stayed, or if
the stay of any such order or proceeding shall thereafter be set aside, or if,
within sixty (60) days after the appointment without the consent or acquiescence
of the Company of any trustee, receiver or liquidator of the Company or of all
or any substantial part of the properties of the Company, such appointment shall
not have been vacated.
ARTICLE
IV
SECURITY
INTEREST
To secure
the obligations of the Company pursuant to this Note, the Company hereby grants
to the Holder a security interest in the Purchased Assets. The Holder
shall have the right to file a financing statement to perfect the security
interest granted hereunder. The Holder shall have all rights afforded
to a secured creditor under Article 9 of the Uniform Commercial Code, as adopted
by the State of Nevada.
ARTICLE
V
MISCELLANEOUS
5.1 Failure or Indulgence Not
Waiver. No failure or delay on the part of the Holder hereof
in the exercise of any power, right or privilege hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such power,
right or privilege preclude other or further exercise thereof or of any other
right, power or privilege. All rights and remedies existing hereunder
are cumulative to, and not exclusive of, any rights or remedies otherwise
available.
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 (a) personally served, (b) deposited in the mail,
registered or certified, return receipt requested, postage prepaid, (c)
delivered by a reputable overnight courier service with charges prepaid, or (d)
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 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),
(ii) on the first business day following the date deposited with an overnight
courier service with charges prepaid, or (iii) on the third business day
following the date of mailing pursuant to subpart (b) above, or upon actual
receipt of such mailing, whichever shall first occur. The addresses
for such communications shall be: (i) if to the Company to: Tix Corporation,
12001 Ventura Place, Suite 340, Studio City, California 91604,
Attn: Mitchell J. Francis, CEO, fax number: (818) 761-1072, with a
copy by fax only to: TroyGould, 1801 Century Park East, Suite 1600,
Los Angeles, CA 90067-2367, Attn: David L. Ficksman, Esq., fax number: (310)
789-1490, and (ii) if to the Holder, to the name, address and fax number set
forth on the front page of this Note, with a copy by facsimile only to Allen
Matkins Leck Gamble Mallory & Natsis LLP, 515 South Figueroa Street, 9th
Floor, Los Angeles, California 90071, Attn: Mathew J. Ertman, Esq.,
fax number (213) 620 8816.
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5.3 Amendment
Provision. The term “Note” and all reference thereto, as used
throughout this instrument, shall mean this instrument as originally executed,
or if later amended or supplemented, then as so amended or
supplemented.
5.4 Assignability. This
Note shall be binding upon the Company and its successors and assigns, and shall
inure to the benefit of the Holder and its successors and
assigns. The Company may not assign its obligations under this
Note.
5.5 Cost of
Collection. If default is made in the payment of this Note,
the Company shall pay the Holder hereof reasonable costs of collection,
including reasonable attorneys’ fees.
5.6 Governing
Law. This Note shall be governed by and construed in
accordance with the laws of the State of Nevada.
5.7 Stockholder
Status. The Holder shall not have rights as a stockholder of
the Company with respect to unconverted portions of this
Note. However, the Holder will have all the rights of a stockholder
of the Company with respect to the shares of Common Stock to be received by
Holder after delivery by the Holder of a Conversion Notice to the
Company.
5.8 Waiver of
Notice. The Company hereby waives notice, presentment, demand,
protest and notice of dishonor.
[THIS
SPACE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, The
Company has caused this Note to be signed in its name by an authorized officer
as of the 10th day of
February 2010.
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TIX
CORPORATION
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By:
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Name: Mitch
Francis
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Title:
Chief Executive
Officer
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7
EXHIBIT
A
NOTICE OF
CONVERSION
(To be
executed by the Registered Holder in order to convert the Note)
The
undersigned hereby elects to convert the principal amount of the Convertible
Note (the “Note”) issued by Tix Corporation (the “Company”) on February 10, 2010
into shares of Common Stock of the Company according to the conditions set forth
in such Note, as of the date written below.
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Date
of Conversion:
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Conversion
Price:
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Shares
To Be Delivered:
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Signature:
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Print
Name:
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Address:
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