EXHIBIT 99.2
LOAN EXTENSION AGREEMENT
This Loan Extension Agreement (the "Agreement") is made and dated as of
this 26th day of June, 2000 between Globalmedia.com, a Nevada Corporation (the
"Borrower") and RealNetworks, Inc., a Washington Corporation, with its principal
place of business at 2601 Elliott Avenue, Seattle, Washington 98121 (the
"Lender").
RECITALS
A. Pursuant to the terms of the RealChannels Agreement dated January
19, 2000, the Livestations Agreement dated November 1, 1999, the Gidget
Sponsorship Advertising Insertion Order, the On-going Advertising Insertion
Order, the Custom Software Upgrades and Support Terms and Conditions Addendum
dated as of January 19, 2000, and a Release and Settlement Agreement stamped
February 16, 2000, all between Borrower and Lender (collectively, the "Subject
Contracts"), Borrower was obligated to to pay Lender the aggregate sum of
$2,000,000.00 on or before June 15, 2000 (the "Sum").
B. The due date for the Sum was no later than June 15, 2000. The
balance due as of June 15, 2000 is as follows:
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ITEM AMOUNT
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$2,000,000.00
Principal as of June 15, 2000
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C. Borrower is in default under the Subject Contracts, and the Sum is
now due and payable in full. Borrower has requested that Lender enter into a
loan extension arrangement for repayment of the Sum. Lender has agreed to enter
into such a loan extension arrangement with Borrower on the terms and subject to
the conditions set forth in this Agreement.
D. This Agreement is intended to resolve all disputes among Lender and
Borrower as of the date hereof, to permit Borrower the Payment Schedule and
Terms set forth below, to reassure Lender that Borrower will pay the Sum in
full, and to give Lender the benefit of the representations and warranties made
by Borrower below.
NOW THEREFORE, in consideration of the above recitals and for
other good and valuable consideration, and in consideration for Lender
accommodating Borrower by extending the due date of the Sum and making
modifications to the Subject Contracts, the receipt and adequacy of which are
hereby acknowledged, the parties hereto agree as follows:
1. EXTENDED PAYMENT SCHEDULE AND MODIFIED CONTRACT TERMS.
(a) At execution of this Agreement, Borrower agrees to pay
Lender the sum of One Million, Twenty Five Thousand, Nine Hundred Eighty Three
and sixty four/hundredths Dollars ($1,025,983.64) by wire transfer to be
received by Lender no later than June 27, 2000 representing payment of
$1,000,000.00 of the Sum and payment of $25,983.64 past due amounts on the
Subject Contracts.
(b) On or before September 1, 2000, Borrower agrees to pay
Lender by wire transfer the sum of One Million Dollars ($1,000,000.00), together
with interest at the rate of eight percent (8%) per annum accrued on that
amount.
(c) Lender agrees to accept the foregoing payments in lieu of
the payments required as of June 15, 2000 by the Subject Contracts so long as no
condition or event exists which constitutes an Event of Default under this
Agreement.
(d) In addition, Borrower agrees to pay the sum of Thirty Six
Thousand, Six Hundred Ninety Four and seventy seven hundredths Dollars ($
36,694.77), representing amounts currently due under the Streaming Media
Services Agreement dated January 19, 2000 ("Streaming Services Agreement") by
wire transfer to be received by Lender no later than June 27, 2000.
(e) In addition, Borrower agrees to pay the sum of One Hundred
Thousand Dollars ($ 100,000.00), representing amounts that are due no later than
July 1, 2000 under the Livestations Agreement by wire transfer to be received by
Lender no later than July 1, 2000.
(f) Lender and Borrower agree as follows:
(i) the Streaming Services Agreement shall be amended
by the First Amendment to Streaming Media Services Agreement of even date
herewith, which the parties are executing simultaneously with this Agreement;
(ii) this Agreement shall serve as a First Amendment
to the Livestations Agreement to provide that the term of the Livestations
Agreement as to the first ten stations launched shall end on November 1, 2000,
and the term for the next five stations launched shall end on May 1, 2001.
(iii) the RealChannels Agreement is amended hereby to
provide that the "Term" (as defined therein) shall end on June 3, 2001; and
(iv) the On-going Advertising Insertion Order is
amended hereby to list as the impressions to be provided the following:
28,000,000 Real Sites Run of Network Banners
(Space Avail.)
14,000,000 Buttons
8,000,000 Channels Run of Channels In-stream Ads
And further provided that the flight dates for the
In-stream ads shall be amended to start 6-26-00 and end 6-25-01 and the flight
dates for the Banners and Buttons shall start 6-26-00 and end 1-16-01.
2. RELATIONSHIP OF THIS AGREEMENT TO SETTLEMENT AGREEMENT AND SUBJECT
CONTRACTS. Borrower understands that Lender is willing to grant the
accommodations described in Section 1 above to Borrower expressly and only on
condition that Borrower makes when due each and every payment required by
Section 1 above and there is no other Event of Default. If Borrower makes when
due all payments required by Section 1 above the Sum shall be deemed "paid in
full." Lender and Borrower agree to execute all documents necessary to
effectuate this provision. If Borrower fails to make any payment required by
Section 1 hereof when due or any other Event of Default shall occur, the Lender
shall have the
rights and remedies provided in this Agreement, including, without limitation,
the right to enforce this Agreement in accordance with its terms. Except as
otherwise expressly provided in this Agreement (or any other agreements entered
into pursuant to Section 1(f) above), all of the terms and conditions of the
Subject Contracts are hereby reaffirmed, and shall be and remain in full force
and effect until all obligations of Borrower under this Agreement have been
satisfied.
3. REPRESENTATIONS AND WARRANTIES. As an inducement to Lender to enter
into this Agreement and to accept payments in accordance with the provisions of
Section 1 of this Agreement, Borrower hereby reaffirms as of the date of this
Agreement all representations, warranties, covenants, agreements and promises
set forth in the Subject Contracts, and further represents and warrants to
Lender as follows:
(a) Borrower has entered into this Agreement and the obligation to
make the payments described in Section 1 above for the purposes of
carrying out Borrower's bona fide business objectives.
(b) Borrower hereby acknowledges that Borrower did not pay the Sum
on time and that the Sum is fully due and owing, and that the
Subject Contracts are not subject to any defenses, setoffs,
recoupments, or counterclaims of any sort.
(c) Borrower, for itself and for its assigns, representatives,
agents, and for any other person or persons, or entity or
entities acting by, for or through it, hereby fully surrender
to and release, acquit and forever discharge Lender, its
representatives, agents, counsel and assigns from any and all
manner of actions, causes of action, suits, damages, sums of
money, demands or claims, whatsoever, in law or in equity,
direct or indirect, whether or not now known, suspected or
unsuspected which arise out of any actual or alleged act or
omission by Lender, its agents and assigns relating to its
obligations under the Subject Contracts ("Subject Claims");
provided, that the foregoing release shall not apply to any
obligations of Lender, its agents or assigns under the Subject
Contracts which are to be performed after the date of this
Agreement. Borrower acknowledges that this is a full and final
release of the Subject Claims.
(d) Borrower agrees that the balance of the Sum due as of
June 15, 2000 is the amount set forth in the recitals to this
Agreement.
4. EVENTS OF DEFAULT. Any of the following events shall constitute an
Event of Default ("Event of Default") hereunder:
(a) Borrower fails to pay when due any sum which Borrower is
required to pay, or fails to perform when due any obligation
which Borrower is required to perform under Section 1 of this
Agreement, or otherwise fails to pay, perform, or observe any
obligation, agreement or covenant to be paid, performed or
observed by Borrower under this Agreement.
(b) If the payments made by Borrower to Lender hereunder are
avoided, set aside, recovered or taken away from Lender in
connection with any bankruptcy, insolvency or receivership
proceeding instituted by or against Borrower.
5. REMEDIES. Upon the occurrence of an Event of Default by Borrower,
the full amount of this Agreement shall become due and payable, the Subject
Agreements shall be deemed in default, and Lender may, at its option and without
notice to Borrower, enforce this Agreement and the Subject Agreements though any
means available by Law.
6. SURVIVAL. All of Borrower's representations and warranties made in
this Agreement shall survive this Agreement and shall not be merged upon
performance by Borrower and Lender of the terms of this Agreement.
7. NO WAIVER. No failure to exercise, and no delay in exercising any
right, power, or remedy hereunder shall impair any right, power or remedy which
Lender may have, nor shall any such delay be construed as a waiver of any such
rights, powers, or remedies, or an acquiescence in any breach or default under
this Agreement or under any Loan Document, nor shall any waiver of any breach or
default of Borrower be deemed a waiver of any default or breach subsequently
occurring.
8. REMEDIES NOT EXCLUSIVE. No remedy herein conferred on the Lender is
intended to be exclusive of any other remedy herein or in any other agreement
between the parties hereto or by law provided or permitted, but each shall be
cumulative and shall be in addition to every other remedy given hereunder or
thereunder or now or hereafter existing at law, in equity or by statute.
9. SEVERABILITY. In case any one or more of the provisions contained in
this Agreement should be invalid, illegal, or unenforceable in any respect, the
validity, legality, and enforceability of the remaining provisions contained
herein shall no in any way be affected or impaired thereby.
10. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of Borrower, Lender, and their respective successors and
assigns; provided however, that Borrower may not transfer its rights or
obligations under this Agreement without the prior written consent of the
Lender.
11. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the state of Washington. The parties hereby
irrevocably consent to the jurisdiction of the state and federal courts located
in King County, Washington, in any proceedings arising under or relating to this
Agreement, and also consent to venue in King County, Washington.
12. AMENDMENT AND WAIVER. No provision of this Agreement may be
amended, modified, supplemented, changed, waived, discharged, or terminated
unless each party hereto consents in writing.
13. NOTICES. Any notice to be given to either party shall be
sufficiently given on the date of mailing if delivered personally with receipt
acknowledged, or sent by first-class registered or certified mail, overnight
courier, or the equivalent, return-receipt requested, postage or charges
prepaid, addressed to such party at the address set forth below.
To Lender: RealNetworks, Inc.
Copy to General Counsel and Chief Operating Officer
To Borrower: 400 Robson Street
Vancouver, British Columbia V6B 2B4
Canada
Attn.: Chief Executive Officer; Chief Financial
Officer
14. ATTORNEYS' FEES; EXPENSES. In the event suit or action is
instituted to enforce any of the terms of this Agreement, including any and all
bankruptcy claims, actions and proceedings deemed necessary or desirable to
enforce any of the terms of this agreement or otherwise protect the interests of
the Lender, the prevailing party shall be entitled to recover such sum as the
court may adjudge reasonable as attorneys' fees and expenses, including fees or
expenses that may be incurred in any appellate proceeding. In the event neither
party wholly prevails, the party that substantially prevails shall be awarded a
reasonable sum as attorneys' fees and litigation expenses. In determining what
is a reasonable sum for attorneys' fees the party is obligated to pay its
attorney or attorneys shall be presumed to be reasonable,
and the actual expenses incurred in the proceeding shall be presumed to be
reasonable. Whether or not any court action is involved, all reasonable expenses
incurred that are necessary at any time in Lender's opinion for the protection
of its interests or the enforcement of its rights, including (without
limitation) the cost of searching records, obtaining title reports and
attorneys' consultations or opinions or title insurance, shall become a part of
the indebtedness.
15. COUNTERPARTS. This Agreement may be executed in any number of
counterparts which, when taken together, shall constitute one agreement.
16. TIME OF ESSENCE. Time is off the essence of this Agreement.
17. ARM'S LENGTH LEGAL RELATIONSHIP. The parties acknowledge and
warrant that the relationship between Borrower and Lender is not a fiduciary
relationship, a joint venture, a tenancy in common, a partnership, or anything
other than a relationship between a lender and borrower.
18. REPRESENTATION BY COUNSEL. In drafting and entering into this
Agreement, Borrower and Lender were represented by independent counsel of their
own choice.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first written.
LENDER:
RealNetworks, Inc.
/s/ K. J. MacArthur
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Kelly Jo MacArthur
Sr. VP & General Counsel
TO THE BORROWER: THIS IS A LEGALLY BINDING CONTRACT WHICH OBLIGATES YOU TO DO
CERTAIN THINGS, AND WHICH GIVES LENDER CERTAIN RIGHTS AND REMEDIES. DO NOT SIGN
THIS AGREEMENT WITHOUT READING IT. IF YOU HAVE ANY QUESTIONS ABOUT THIS
AGREEMENT, CONSULT YOUR LAWYER BEFORE YOU SIGN. THE LENDER CANNOT GIVE YOU LEGAL
ADVICE ABOUT YOUR RIGHTS OR OBLIGATIONS UNDER THIS AGREEMENT.
NOTICE: ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY, EXTEND CREDIT, OR TO
FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON
LAW.
BORROWER:
Globalmedia.com
/s/ Winston Barta
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