Debt Conversion Agreement by and between True Drinks Holdings, Inc. and Red Beard, LLC, dated April 26, 2019

 

This Debt Conversion Agreement (the “Agreement”) is entered into this 26 day of April, 2019 by and among True Drinks Holdings Inc., a Nevada corporation (the “Company”), and Red Beard Holdings, LLC, a Delaware limited liability company (“Red Beard”). Each of the Company, and Red Beard may be referred to herein, individually, as a “Party” and, collectively, as the “Parties”.

 

WHEREAS, The Company and Red Beard wish to restructure $3,935,757 principal amount of debt, together with all accrued and unpaid interest thereon (“Outstanding Amount”) issued to Red Beard in the form of several promissory notes set forth on Exhibit A attached hereto (the “Notes”) into shares of Company common stock, par value $0.001 per share (“Common Stock”); and

 

NOW, THEREFORE, for good and valuable consideration, the sufficiency of which is hereby acknowledged, the Parties hereby agree as follows:

 

1. Conversion. The Company and Red Beard hereby agree to convert the Outstanding Amount and all other payment obligations as of the date hereof into 1,070,741,474 shares of Common Stock (the “Conversion Shares”) (“Conversion”), which Conversion shall only be effective upon closing of the Exchange, as such term is defined in the Exchange Agreement, a copy of which is attached hereto as Exhibit B. Upon consummation of the Exchange, the Parties agree and acknowledge that the Notes shall terminate and be of no further force and effect, and shall only represent the right to receive the Conversion Shares.

 

2. Representations and Warranties. Each Party represents and warrants to each other Party, as of the date hereof, that with respect to itself, (a) it has the corporate power to execute and deliver this Agreement and perform its obligations under this Agreement, (b) this Agreement has been duly executed and delivered by it and is legally binding upon it (assuming that each other Party has duly executed and delivered this Agreement), enforceable in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting Red Beards’ rights and to general principles of equity, and (c) the execution, delivery and performance of this Agreement by the Parties, and the consummation of the transactions contemplated by this Agreement, will not (i) violate any provision of any governing instruments of the Parties, (ii) result in a material default (with due notice or lapse of time or both) or the creation of any lien or encumbrance or give rise to any right of termination, cancellation or acceleration under any material note, bond, mortgage, indenture, or other financing instrument to which the Parties are parties or by which they are bound, (iii) violate any judgment, order, ruling or regulation applicable to the Parties as parties in interest, or (iv) violate any law applicable to the Parties, except any matters described in clauses (ii) or (iii) above which would not have a material adverse effect on the Parties or their properties.

 

3. Notices.

 

 

 

 

5. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN CONNECTION WITH ANY DISPUTE, CONTROVERSY OR CLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.

 

6. Waivers; Amendments.

 

7. Assignment. The provisions of this Agreement shall be binding upon and inure to the benefit of the Parties hereto and their respective successors and assigns.

 

8. No Third-Party Beneficiaries. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any person (other than the Parties hereto, their respective successors and assigns permitted hereby) any legal or equitable right, cause of action, remedy or claim under or by reason of this Agreement.

 

9. Severability. Any provision of the Agreement held to be invalid, illegal or unenforceable in any respect in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions thereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

 

10. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original instrument, but all such counterparts together shall constitute but one agreement.

 

11. Headings. Section headings used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

 

 

 

12. Interpretation. The Parties acknowledge and agree that (i) each Party has had the opportunity to exercise business discretion in relation to the negotiation of the details of the transaction contemplated hereby, (ii) this Agreement is the result of arms-length negotiations from equal bargaining positions and (iii) each Party and its counsel participated in the preparation and negotiation of this Agreement. Any rule of construction that a contract be construed against the drafter shall not apply to the interpretation or construction of this Agreement.

 

13. Entire Agreement. This Agreement constitute the entire agreement among the Parties pertaining to the subject matter hereof, and supersede all prior agreements, understandings, negotiations and discussions, whether oral or written, of the Parties pertaining to the subject matter hereof.

 

 

 

 

 

 

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written.