EXHIBIT 10.2
BLUESTAR HEALTH, INC.
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CONVERTIBLE PROMISSORY NOTE
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Amended and Restated October 28, 2007
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$238,432.00 March 1, 2007
FOR VALUE RECEIVED, Bluestar Health, Inc., a Colorado corporation, its assigns
and successors (the "Company"), hereby promises to pay to the order of Alfred
Oglesby, an individual, or his assigns (the "Holder"), in immediately available
funds, the total principal sum of Two Hundred Thirty Eight Thousand Four Hundred
Thirty Two Dollars ($238.432.00). The principal hereof plus the accrued interest
thereon ("Initial Interest Period") shall be due and payable in 20 equal
quarterly installments (collectively the "Repayment Period") of $16,441.83
commencing December 1, 2007 (the "Initial Payment Date") (unless such payment
date is accelerated as provided in Section 7 hereof). The Company at its sole
discretion may replace cash payments on the first twelve (12) payments with an
equivalent payment in the Company's common shares at Fifty percent (50%) of the
trading price as determined in (4) below. Payment of all amounts due hereunder
shall be made at the address of the Holder provided for in Section 8 hereof.
Interest shall accrue during the Initial Interest Period and during the
Repayment Period at the rate of Ten percent (10%) per annum on this Note from
the date hereof and shall continue to accrue until all unpaid principal and
interest is paid in full.
1. HISTORY OF THE LOAN. The original version of this Promissory Note was
delivered to Holder as consideration for amounts owed by the Company to the
Holder for advances previously made to the Company by the Holder effective as of
March 1, 2007. This Amended and Restated Promissory Note ("Note" or "Promissory
Note") amends and restates the original Promissory Note dated March 1, 2007 by
mutual consent of the Company and Holder. This Amended and Restated Promissory
Note shall in all respects replace the terms of the original Promissory Note.
2. PREPAYMENT. The Company may, at its option, at any time and from time to
time, prepay all or any part of the principal balance of this Note, without
penalty or premium, provided that concurrently with each such prepayment the
Company shall pay accrued interest on the principal, if any, so prepaid to the
date of such prepayment.
4. CONVERSION. The Holder is entitled, at his option, at any time beginning
on the date hereof, and in whole or in part, to convert the outstanding
principal amount of this Note, or any portion of the principal amount hereof,
and any accrued interest, into shares of the common stock of the Company. Any
amounts Holder elects to convert will be converted into common stock at a
conversion price per share equal to Eighty percent (80%) of the average closing
price of the Company's common stock over the most recent five (5) trading days
as quoted on a USA public exchange or the Pink Sheets (the "Conversion Price").
Any conversion shall be effectuated by giving a written notice ("Notice of
Conversion") to the Company on the date of conversion, stating therein the
amount of principal and accrued interest due to Holder under this Note being
converted. If the Company fails to deliver the shares of common stock due to
Holder within seven (7) days of receipt of a Notice of Conversion, Holder shall
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be entitled to receive a cash payment equal to the difference between the fair
market value of the shares of common stock due to Holder on the date of delivery
of the Notice of Conversion and the total conversion price required to convert
the shares of common stock due to Holder (which amount shall be paid as
liquidated damages and not as a penalty).
5. TRANSFERABILITY. This Note shall not be transferred, pledged,
hypothecated, or assigned by the Company without the express written consent of
the Holder. In the event any third party acquires a controlling interest in the
Company or acquires substantially all of the assets of the Company (a
"Reorganization Event"), this Note will survive and become an obligation of the
party that acquires such controlling interest or assets. In the event of a
Reorganization Event the Company agrees to make the party that acquires such
controlling interest or assets, aware of the terms of this Section and this
Note. This Note may be transferred, pledged, hypothecated, or assigned by the
Holder in his sole discretion.
6. RESERVATION AND LISTING OF SECURITIES. The Company shall at all times
reserve and keep available out of its authorized shares of common stock, solely
for the purpose of issuance upon the conversion of this Note, such number of
shares of common stock as would be necessary to convert the entire amount due
and owing under the terms of this Note if Holder elected to convert said amount
under Section 3 hereof.
7. DEFAULT. The occurrence of any one of the following events shall
constitute an Event of Default:
(a) The non-payment, when due, of any principal or interest pursuant to
this Note;
(b) The material breach of any representation or warranty in this Note.
In the event the Holder becomes aware of a breach of this Section 7(b), the
Holder shall notify the Company in writing of such breach and the Company shall
have five business days after notice to cure such breach;
(c) The breach of any covenant or undertaking, not otherwise provided
for in this Section 7;
(d) The commencement by the Company of any voluntary proceeding under
any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt,
receivership, dissolution, or liquidation law or statute of any jurisdiction,
whether now or hereafter in effect; or the adjudication of the Company as
insolvent or bankrupt by a decree of a court of competent jurisdiction; or the
petition or application by the Company for, acquiescence in, or consent by the
Company to, the appointment of any receiver or trustee for the Company or for
all or a substantial part of the property of the Company; or the assignment by
the Company for the benefit of creditors; or the written admission of the
Company of its inability to pay its debts as they mature; or
(e) The commencement against the Company of any proceeding relating to
the Company under any bankruptcy, reorganization, arrangement, insolvency,
adjustment of debt, receivership, dissolution or liquidation law or statute of
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any jurisdiction, whether now or hereafter in effect, provided, however, that
the commencement of such a proceeding shall not constitute an Event of Default
unless the Company consents to the same or admits in writing the material
allegations of same, or said proceeding shall remain undismissed for 20 days; or
the issuance of any order, judgment or decree for the appointment of a receiver
or trustee for the Company or for all or a substantial part of the property of
the Company, which order, judgment or decree remains undismissed for 20 days; or
a warrant of attachment, execution, or similar process shall be issued against
any substantial part of the property of the Company.
Upon the occurrence of any Default or Event of Default, the Holder, may, by
written notice to the Company, declare all or any portion of the unpaid
principal amount due to Holder, together with all accrued interest thereon,
immediately due and payable, in which event it shall immediately be and become
due and payable, provided that upon the occurrence of an Event of Default as set
forth in paragraph (d) or paragraph (e) hereof, all or any portion of the unpaid
principal amount due to Holder, together with all accrued interest thereon,
shall immediately become due and payable without any such notice.
8. NOTICES. Notices to be given hereunder shall be in writing and shall be
deemed to have been sufficiently given if delivered personally or sent by
overnight courier, or by facsimile transmission. Notice shall be deemed to have
been received on the date and time of personal or overnight delivery or
facsimile transmission, if received during normal business hours of the
recipient; if not, then on the next business day.
Notices to the Company shall be sent to: Bluestar Health, Inc.
19901 Southwest Freeway
Sugar Land, TX 77479
Attn: President
Facsimile No.: (281) 207-5486
with a copy to: John Hannesson, Esq.
18661 Via Palatino
Irvine, California 92612
Facsimile (949) 509-9867
Notices to the Holder shall be sent to: Alfred Oglesby
19901 Southwest Freeway
Sugar Land, TX 77479
Facsimile No.: (281) 207-5485
9. REPRESENTATIONS AND WARRANTIES. The Company hereby makes the following
representations and warranties to the Holder:
(a) Organization, Good Standing and Power. The Company is a corporation
duly incorporated, validly existing and in good standing under the laws of the
State of Colorado and has the requisite corporate power to own, lease and
operate its properties and assets and to conduct its business as it is now being
conducted.
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(b) Authorization; Enforcement. The Company has the requisite corporate
power and authority to enter into and perform this Note and to issue and sell
this Note. The execution, delivery and performance of this Note by the Company,
and the consummation by it of the Transactions contemplated hereby, have been
duly and validly authorized by all necessary corporate action. This Note when
executed and delivered, will constitute a valid and binding obligation of the
Company enforceable against the Company in accordance with its terms, except as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation, conservatorship, receivership or
similar laws relating to, or affecting generally the enforcement of, creditor's
rights and remedies or by other equitable principles of general application.
(c) Disclosure. Neither this Note nor any other document, certificate or
instrument furnished to the Holder by or on behalf of the Company in connection
with the transactions contemplated by this Note contains any untrue statement of
a material fact or omits to state a material fact necessary in order to make the
statements made herein or therein, in the light of the circumstances under which
they were made herein or therein, not misleading.
10. PIGGYBACK REGISTRATION RIGHTS. If the Company at any time proposes to
conduct an offering of its securities so as to register any of its securities
under the Securities Act of 1933 (the "Act"), including under an S-1
Registration Statement or otherwise, it will at such time give written notice to
Holder, or its assigns, of its intention so to do. Upon the written request of
Holder, or assigns, given within 10 days after receipt of any such notice, the
Company will use its best efforts to cause all the common stock issued to Holder
in payment of this note to be registered under the Act (with the securities
which the Company at the time proposes to register).
11. CONSENT TO JURISDICTION AND SERVICE OF PROCESS. The Company consents to
the jurisdiction of the courts of the State of Texas and of any state and
federal court located in the County of Harris, Texas.
12. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED ENTIRELY THEREIN, WITHOUT GIVING EFFECT TO
THE RULES OR PRINCIPLES OF CONFLICTS OF LAW.
13. ATTORNEYS FEES. In the event the Holder hereof shall refer this Note to
an attorney to enforce the terms hereof, the Company agrees to pay all the costs
and expenses incurred in attempting or effecting the enforcement of the Holder's
rights, including reasonable attorney's fees, whether or not suit is instituted.
14. CONFORMITY WITH LAW. It is the intention of the Company and of the
Holder to conform strictly to applicable usury and similar laws. Accordingly,
notwithstanding anything to the contrary in this Note, it is agreed that the
aggregate of all charges which constitute interest under applicable usury and
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similar laws that are contracted for, chargeable or receivable under or in
respect of this Note, shall under no circumstances exceed the maximum amount of
interest permitted by such laws, and any excess, whether occasioned by
acceleration or maturity of this Note or otherwise, shall be canceled
automatically, and if theretofore paid, shall be either refunded to the Company
or credited on the principal amount of this Note.
IN WITNESS WHEREOF, the Company has signed and sealed this Note and
delivered it as of October 31, 2007.
"Company" "Holder"
Bluestar Health, Inc.,
a Colorado corporation
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By: Richard M. Greenwood By: Alfred Oglesby,
Its: President an individual
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