Common use of RESALE COMPLIANCE Clause in Contracts

RESALE COMPLIANCE. The undersigned agrees to comply with the 1933 Act and the rules and regulations promulgated thereunder, and any other relevant securities legislation and policies governing the purchase, holding and resale of the Units subscribed for, including, without limitation, applicable state Blue Sky laws. Entered into this ____ day of ____________, 199_. __________________________________ (Name) (Please Print) __________________________________ (Signature) __________________________________ (Mailing Address) __________________________________ (Registration Instructions) THIS SUBSCRIPTION IS ACCEPTED BY THE COMPANY ON THE __ DAY OF _______________199_. HEALTHWATCH, INC. By: __________________________________ Its _____________________________ EXHIBIT A CERTIFICATE OF THE DESIGNATION, PREFERENCES, RIGHTS AND LIMITATIONS OF THE SERIES B CONVERTIBLE PREFERRED STOCK OF HEALTHWATCH, INC. HealthWatch, Inc., hereinafter called the "Corporation", a corporation organized and existing under the Minnesota Business Corporation Act does hereby certify that, pursuant to authority conferred upon the Board of Directors by the Articles of Incorporation, as amended, of the Corporation, said Board of Directors at a meeting duly called and held on November __, 1996, and at which a quorum was at all times present, duly adopted a Resolution providing for the issuance of a series of 500,000 shares of Series B Convertible Preferred Stock, which Resolution is as follows: "RESOLVED, that pursuant to the authority expressly granted to and vested in the Board of Directors of this Corporation in accordance with the provisions of its Articles of Incorporation, as amended, a series of Preferred Stock of the Corporation be and it hereby is given the distinctive designation of "Series B Convertible Preferred Stock" (hereinafter referred to as the "Series B Stock"), said Series to consist of Five Hundred Thousand (500,000) shares of the stated value of Two Dollars and Twenty-Five Cents ($2.25) per share. The preferences and relative, participating, optional or other special rights, and the qualifications, limitations or restrictions thereof shall be as follows:

RESALE COMPLIANCE. The undersigned agrees to comply with the 1933 Act and the rules and regulations promulgated thereunder, and any other relevant securities legislation and policies governing the purchase, holding and resale of the Units Debentures subscribed for, including, without limitation, applicable state Blue Sky blue sky laws. The undersigned acknowledges that this subscription shall not be effective unless accepted by the Company as indicated below. Entered into this ____ 8th day of ____________May, 199_1997. __________________________________ Xxxxxxx X. Xxxxxxx ------------------------------------- (Name) (Please Print) __________________________________ ------------------------------------- (Signature) __________________________________ ------------------------------------- (Mailing Address) __________________________________ ------------------------------------- (Registration Instructions) ------------------------------------- (Social Security or Tax Identification No.) THIS SUBSCRIPTION IS ACCEPTED BY THE COMPANY ON THE __ 8TH DAY OF _______________199_MAY, 1997. HEALTHWATCH, INC. RENAISSANCE ENTERTAINMENT CORPORATION By: __________________________________ Its _____________________________ EXHIBIT ------------------------------------------- Xxxxxxx X. Xxxxxxx, Chief Executive Officer APPENDIX A CERTIFICATE THE SECURITIES DESCRIBED HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE 1933 ACT") OR UNDER THE SECURITIES LAWS OF ANY STATE OF THE DESIGNATION, PREFERENCES, RIGHTS AND LIMITATIONS UNITED STATES. NO REGULATORY BODY HAS ENDORSED THESE SECURITIES. NO SALE OR DISTRIBUTION OF THE SERIES B SECURITIES MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE 1933 ACT AND APPLICABLE STATE BLUE SKY LAWS. No. D-1 $500,000.00 RENAISSANCE ENTERTAINMENT CORPORATION 9% CONVERTIBLE PREFERRED STOCK OF HEALTHWATCH, INC. HealthWatch, Inc., hereinafter called the "SECURED DEBENTURE DUE 2002 THIS DEBENTURE is one of a duly authorized issue of Debentures of Renaissance Entertainment Corporation", a corporation duly organized and existing under the Minnesota Business Corporation Act does hereby certify thatlaws of the State of Colorado (the "Company"), designated as its 9% Convertible Secured Debentures Due 2002, in an aggregate principal amount not exceeding $1,500,000, issued pursuant to authority conferred upon that certain Subscription and Purchase Agreement dated May 8, 1997, between the Board Company and the original purchasers of Directors by the Articles Debentures (the "Purchase Agreement"). Reference is hereby made to the Purchase Agreement for a complete description of Incorporationthe rights and obligations of, and limitations and restrictions on, the Company and the Holder of this Debenture. The terms and conditions of the Debenture noted hereinafter are subject in every respect to the terms and conditions of the Purchase Agreement. In the event of a conflict between the provisions of this Debenture and the Purchase Agreement, the Purchase Agreement shall control. FOR VALUE RECEIVED, the Company promises to pay to Xxxxxxx X. Xxxxxxx the registered holder hereof (the "Holder"), the principal sum of Five Hundred Thousand Dollars ($500,000.00), on April 1, 2002, subject to acceleration in certain events, and to pay interest on the principal sum outstanding from time to time quarterly in arrears on the first business day of each calendar quarter of each year ("Interest Payment Dates"), after as well as before maturity and default and after judgment, at the rate of 9% per annum accruing from the date of initial issuance. Payment of interest shall commence on the first such business day to occur after the date hereof (and shall be pro rated for such period from the date of initial issuance) and shall continue on the first business day of each succeeding calendar quarter until payment in full of the principal sum has been made or duly provided for. All accrued and unpaid interest shall bear interest at the same rate as the due date of the interest payment until paid but shall not be subject to conversion. December 15, March 15, June 15 and September 15 of each year shall serve as the record date (the "Record Date") for determining ownership of this Debenture with respect to payments of interest to be made on the following Interest Payment Date. The interest so payable on any Interest Payment Date will, as amendedprovided in the Purchase Agreement, be paid to the person in whose name this Debenture (or one or more predecessor Debentures) is registered on the records of the CorporationCompany regarding registration and transfers of the Debentures (the "Debenture Register") at the Record Date for such Interest Payment Date; provided, said Board of Directors at a meeting duly called and held on November __, 1996, and at which a quorum was at all times present, duly adopted a Resolution providing for the issuance of a series of 500,000 shares of Series B Convertible Preferred Stock, which Resolution is as follows: "RESOLVEDhowever, that pursuant the Company's obligation to the authority expressly granted to and vested in the Board of Directors a transferee of this Corporation Debenture arises only if such transfer, sale or other disposition is made in accordance with the terms and conditions of the Purchase Agreement. The principal of, and interest on, this Debenture are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts, at the address last appearing on the Debenture Register of the Company as designated in writing by the Holder from time to time. The Company will pay interest on this Debenture by sending a check for such interest due, less any amounts required by law to be deducted, to the registered holder of this Debenture and addressed to such holder at the last address appearing on the Debenture Register. The forwarding of such check shall constitute a payment of interest hereunder and shall satisfy and discharge the liability for interest on this Debenture to the extent of the sum represented by such check plus any amounts so deducted unless such check is not paid at par. This Debenture is subject to the following additional provisions: 1. All terms used in this Debenture which are defined in the Purchase Agreement shall have the meanings assigned to them in the Purchase Agreement. 2. The Debentures are issuable in denominations of Fifty Thousand Dollars ($50,000) and integral multiples thereof. As provided in the Purchase Agreement, the Debentures are exchangeable for an equal aggregate principal amount of Debentures of different authorized denominations, as requested by the Holders surrendering the same. No service charge will be made for such registration of transfer or exchange; however, the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with the transfer or exchange of this Debenture. 3. The Company shall be entitled to withhold from all payments of principal of, and interest on, this Debenture any amounts required to be withheld under the applicable provisions of the United States income tax laws or other applicable laws at the time of such payments. 4. This Debenture has been issued and, subject to the exercise of certain registration rights as provided in the Purchase Agreement, any shares of Common Stock issued upon conversion hereof, will be issued subject to investment representations and may be transferred or exchanged only as provided in the Purchase Agreement. Prior to due presentment for transfer of this Debenture, the Company and any agent of the Company may treat the Person in whose name this Debenture is duly registered on the Company's Debenture Register as the owner hereof for the purpose of receiving payment as herein provided and for all other purposes, whether or not this Debenture be overdue, and neither the Company nor any such agent shall be affected by notice to the contrary. 5. If an Event of Default occurs and is continuing, the Holders of not less than Fifteen Percent (15%) in principal amount of the 9% Convertible Secured Debentures then outstanding may declare the principal of all such Debentures to be immediately due and payable in the manner and to the extent provided in the Purchase Agreement, and such declarations may be in certain events rescinded, in the manner and with the effect provided in the Purchase Agreement. 6. Subject to the provisions of the Purchase Agreement, the Holder of this Debenture is entitled, at its Articles option, at any time after April 30, 1998, until maturity hereof to convert the principal amount of Incorporationthis Debenture or any portion of the principal amount hereof which is at least Ten Thousand Dollars ($10,000) or, as amendedif at the time of such election to convert the aggregate principal amount of all Debentures registered to the Holder is less than Ten Thousand Dollars ($10,000), a series then the whole amount thereof, into shares of Preferred Common Stock of the Corporation be and it hereby is given Company at the distinctive designation lesser of "Series B Convertible Preferred Stock" (hereinafter referred to as the "Series B Stock"), said Series to consist of Five Hundred Thousand (500,000) shares of the stated value of Two Four Dollars and Twenty-Five Fifty Cents ($2.254.50) per shareshare (subject to adjustment as provided in the Purchase Agreement) or Seventy (70) percent of the fair market value (as defined) of the Company's Common Stock on the Date of Conversion, upon surrender of this Debenture to the Company at its office in Boulder, Colorado, with the form of conversion notice attached hereto as Exhibit A executed by the Holder of this Debenture evidencing such Holder's intention to convert this Debenture or a specified portion (as above provided) hereof, and accompanied, if required by the Company, by proper assignment hereof in blank. No amount of accrued but unpaid interest shall be subject to conversion. As provided in the Purchase Agreement, the conversion price is subject to adjustment in certain events. 7. The preferences Purchase Agreement contains provisions permitting the Holders of a majority of the aggregate principal amount of all such Debentures at the time outstanding, on behalf of the Holders of all the Debentures, to waive compliance by the Company with certain provisions of the Purchase Agreement and relativecertain past defaults under the Purchase Agreement and their consequences. Any such consent or waiver shall be conclusive and binding upon all Holders and upon all future Holders of this Debenture and of any debenture issued upon registration of transfer hereof or in exchange herefor or in lieu hereof whether or not notation of such consent or waiver is made upon this Debenture. 8. No reference herein to the Purchase Agreement and no provision of this Debenture or of the Purchase Agreement shall alter or impair the obligation of the Company, participatingwhich is absolute and unconditional, optional or other special rightsto pay the principal of, and interest on, this Debenture at the qualificationstime, limitations place and rate, and in the coin or restrictions thereof currency, herein prescribed. This Debenture and all other Debentures now or hereafter issued under the Purchase Agreement are direct obligations of the Company. This Debenture ranks equally and ratably with all other Debentures now or hereafter issued under the Purchase Agreement. 9. No recourse shall be had for the payment of the principal of, or the interest on, this Debenture, or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the Purchase Agreement or any Purchase Agreement supplemental thereto, against any incorporator, shareholder, officer or director, as follows:such, past, present or future, of the Company or any successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issue hereof, expressly waived and released. 10. The Holder of this Debenture, by acceptance hereof, agrees that this Debenture is being and any shares of Common Stock acquired pursuant to the conversion of this Debenture will, unless such condition is waived by the Company, be acquired for investment and that such Holder will not offer, sell or otherwise dispose of this Debenture or such Common Stock except under circumstances which will not result in a violation of the 1933 Act or any applicable state Blue Sky law. This Debenture and any certificate for shares of Common Stock issued upon conversion hereof, unless such requirement is waived by the Company, shall bear a legend in substantially the following form: THE SECURITIES DESCRIBED HEREIN, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT",) OR UNDER THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. NO SALE OR DISTRIBUTION OF THESE SECURITIES MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE 1933 ACT AND APPLICABLE STATE BLUE SKY LAWS. 11. This Debenture shall be governed by and construed in accordance with the laws of the State of Colorado.

RESALE COMPLIANCE. The undersigned agrees to comply with the 1933 Act and the rules and regulations promulgated thereunder, and any other relevant securities legislation and policies governing the purchase, holding and resale of the Units Notes subscribed for, including, without limitation, applicable state Blue Sky blue sky laws. The undersigned acknowledges that this subscription shall not be effective unless accepted by the Company as indicated below. Entered into this this______day of________, 200_. -------------------------------------- (Name) (Please Print) -------------------------------------- (Signature) -------------------------------------- (Mailing Address) -------------------------------------- (Registration Instructions) THIS SUBSCRIPTION IS ACCEPTED BY THE COMPANY ON THE______DAY OF___________200_. RENAISSANCE ENTERTAINMENT CORPORATION By: ---------------------------------- Xxxxxxx X. Xxxxxxx Chairman of the Board of Directors and Chief Executive Officer APPENDIX A THE SECURITIES DESCRIBED HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE 1933 ACT") OR UNDER THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. NO REGULATORY BODY HAS ENDORSED THESE SECURITIES. NO SALE OR DISTRIBUTION OF THE SECURITIES MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE 1933 ACT AND APPLICABLE STATE BLUE SKY LAWS. No._______ day of $_____________ RENAISSANCE ENTERTAINMENT CORPORATION SUBORDINATED PROMISSORY NOTE DUE 2003 A NOTE THIS NOTE is one of a duly authorized issue of Notes of Renaissance Entertainment Corporation, 199_. a corporation duly organized and existing under the laws of the State of Colorado (the "Company"), designated as its 12% Subordinated Notes due August 31, 2003, in an aggregate principal amount not exceeding $1,000,000, issued pursuant to that certain Subscription and Purchase Agreement dated ______________________, 200____________ , between the Company and the original purchasers of the Notes (Name) (Please Print) ____________the "Purchase Agreement"). Reference is hereby made to the Purchase Agreement for a complete description of the rights and obligations of, and limitations and restrictions on, the Company and the Holder of this Note. The terms and conditions of the Note noted hereinafter are subject in every respect to the terms and conditions of the Purchase Agreement. In the event of a conflict between the provisions of this Note and the Purchase Agreement, the Purchase Agreement shall control. FOR VALUE RECEIVED, the Company promises to pay to ______________________ the registered holder hereof (Signature) the "Holder"), the principal sum of _____________________Dollars ($_____________ ), on August 31, 2003, subject to acceleration in certain events, and to pay interest on the principal sum outstanding from time to time quarterly in arrears on the first business day of each calendar quarter of each year (Mailing Address"Interest Payment Dates"), after as well as before maturity and default and after judgment, at the rate of 12% per annum accruing from the date of initial issuance. Payment of interest shall commence on April 1, 2002 (and shall be pro rated for such period from the date of initial issuance) __________________________________ and shall continue on the first business day of each succeeding calendar quarter until payment in full of the principal sum has been made or duly provided for. All accrued and unpaid interest shall bear interest at the same rate as the due date of the interest payment until paid but shall not be subject to conversion. March 15, June 15, September 15 and December 15 of each year shall serve as the record date (Registration Instructions) THIS SUBSCRIPTION IS ACCEPTED BY THE COMPANY ON THE __ DAY OF _______________199_. HEALTHWATCH, INC. By: __________________________________ Its _____________________________ EXHIBIT A CERTIFICATE OF THE DESIGNATION, PREFERENCES, RIGHTS AND LIMITATIONS OF THE SERIES B CONVERTIBLE PREFERRED STOCK OF HEALTHWATCH, INC. HealthWatch, Inc., hereinafter called the "CorporationRecord Date", a corporation organized and existing under ) for determining ownership of this Note with respect to payments of interest to be made on the Minnesota Business Corporation Act does hereby certify that, pursuant to authority conferred upon the Board of Directors by the Articles of Incorporationfollowing Interest Payment Date. The interest so payable on any Interest Payment Date will, as amendedprovided in the Purchase Agreement, be paid to the person in whose name this Note (or one or more predecessor Notes) is registered on the records of the CorporationCompany regarding registration and transfers of the Notes (the "Note Register") at the Record Date for such Interest Payment Date; provided, said Board of Directors at a meeting duly called and held on November __, 1996, and at which a quorum was at all times present, duly adopted a Resolution providing for the issuance of a series of 500,000 shares of Series B Convertible Preferred Stock, which Resolution is as follows: "RESOLVEDhowever, that pursuant the Company's obligation to the authority expressly granted to and vested in the Board of Directors a transferee of this Corporation Note arises only if such transfer, sale or other disposition is made in accordance with the terms and conditions of the Purchase Agreement. The principal of, and interest on, this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts, at the address last appearing on the Note Register of the Company as designated in writing by the Holder from time to time. The Company will pay interest on this Note by sending a check for such interest due, less any amounts required by law to be deducted, to the registered holder of this Note and addressed to such holder at the last address appearing on the Note Register. The forwarding of such check shall constitute a payment of interest hereunder and shall satisfy and discharge the liability for interest on this Note to the extent of the sum represented by such check plus any amounts so deducted unless such check is not paid at par. This Note is subject to the following additional provisions: 1. The Notes are issuable in denominations of One Thousand Dollars ($1,000) and multiples thereof. As provided in the Purchase Agreement, the Notes are exchangeable for an equal aggregate principal amount of Notes of different authorized denominations, as requested by the Holders surrendering the same. No service charge will be made for such registration of transfer or exchange; however, the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with the transfer or exchange of this Note. 2. The Company shall be entitled to withhold from all payments of principal of, and interest on, this Note any amounts required to be withheld under the applicable provisions of its Articles the United States income tax laws or other applicable laws at the time of Incorporationsuch payments. 3. This Note has been issued subject to investment representations and may be transferred or exchanged only as provided in the Purchase Agreement. Prior to due presentment for transfer of this Note, the Company and any agent of the Company may treat the person in whose name this Note is duly registered on the Company's Note Register as the owner hereof for the purpose of receiving payment as herein provided and for all other purposes, whether or not this Note be overdue, and neither the Company nor any such agent shall be affected by notice to the contrary. 4. If an Event of Default occurs and is continuing, the Holders of not less than Thirty Percent (30%) in principal amount of the 12% Subordinate Promissory Notes then outstanding may declare the principal of all such Notes to be immediately due and payable in the manner and to the extent provided in the Purchase Agreement, and such declarations may be in certain events rescinded, in the manner and with the effect provided in the Purchase Agreement. 5. This Note is subordinated and subject in right of payment to the prior payment or satisfaction of Superior Indebtedness of the Company. Each Holder of this Note, by accepting the same, agrees to and shall be bound by this subordination. 6. The Purchase Agreement permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Notes under the Purchase Agreement at any time by the Company with the consent of the Holders of Sixty-six and Two-thirds Percent (66-2/3%) in aggregate principal amount of all such Notes at the time outstanding. The Purchase Agreement also contains provisions permitting the Holders of a majority of the aggregate principal amount of all such Notes at the time outstanding, on behalf of the Holders of all the Notes, to waive compliance by the Company with certain provisions of the Purchase Agreement and certain past defaults under the Purchase Agreement and their consequences. Any such consent or waiver shall be conclusive and binding upon all Holders and upon all future Holders of this Note and of any note issued upon registration of transfer hereof or in exchange herefor or in lieu hereof whether or not notation of such consent or waiver is made upon this Note. 7. Except with respect to the rights of the holders of Superior Indebtedness as set forth in this Note and in the Purchase Agreement, no reference herein to the Purchase Agreement and no provision of this Note or of the Purchase Agreement shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of, and interest on, this Note at the time, place and rate, and in the coin or currency, herein prescribed. This Note and all other Notes now or hereafter issued under the Purchase Agreement are direct obligations of the Company. This Note ranks equally and ratably with all other Notes now or hereafter issued under the Purchase Agreement. 8. No recourse shall be had for the payment of the principal of, or the interest on, this Note, or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the Purchase Agreement or any Purchase Agreement supplemental thereto, against any incorporator, shareholder, officer or director, as amendedsuch, a series of Preferred Stock past, present or future, of the Corporation be Company or any successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and it hereby is given the distinctive designation of "Series B Convertible Preferred Stock" (hereinafter referred to as the "Series B Stock"), said Series to consist of Five Hundred Thousand (500,000) shares part of the stated value of Two Dollars consideration for the issue hereof, expressly waived and Twenty-Five Cents ($2.25) per sharereleased. 9. The preferences Holder of this Note, by acceptance hereof, agrees that this Note is being acquired for investment and relativethat such Holder will not offer, participatingsell or otherwise dispose of this Note except under circumstances which will not result in a violation of the 1933 Act or any applicable state Blue Sky law. This Note unless such requirement is waived by the Company, optional or other special rightsshall bear a legend in substantially the following form: THE SECURITIES DESCRIBED HEREIN, and HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT",) OR UNDER THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. NO SALE OR DISTRIBUTION OF THESE SECURITIES MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE 1933 ACT AND APPLICABLE STATE BLUE SKY LAWS. 10. All terms used in this Note which are defined in the qualifications, limitations or restrictions thereof Purchase Agreement shall have the meanings assigned to them in the Purchase Agreement. 11. This Note shall be as follows:governed by and construed in accordance with the laws of the State of Colorado.

RESALE COMPLIANCE. The undersigned agrees to comply with the 1933 Act and the rules and regulations promulgated thereunder, and any other relevant securities legislation and policies governing the purchase, holding and resale of the Units Notes subscribed for, including, without limitation, applicable state Blue Sky blue sky laws. The undersigned acknowledges that this subscription shall not be effective unless accepted by the Company as indicated below. Entered into this ____ day of April, 1997. --------------------------------------------- (Name) (Please Print) --------------------------------------------- (Signature) --------------------------------------------- (Mailing Address) --------------------------------------------- (Registration Instructions) --------------------------------------------- (Social Security or Tax Identification No.) THIS SUBSCRIPTION IS ACCEPTED BY THE COMPANY ON THE _____ DAY OF APRIL 1997. RENAISSANCE ENTERTAINMENT CORPORATION By: ------------------------------------------ Xxxxxxx X. Xxxxxxx Chief Executive Officer APPENDIX A THE SECURITIES DESCRIBED HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE 1933 ACT") OR UNDER THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. NO REGULATORY BODY HAS ENDORSED THESE SECURITIES. NO SALE OR DISTRIBUTION OF THE SECURITIES MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE 1933 ACT AND APPLICABLE STATE BLUE SKY LAWS. THIS NOTE IS TRANSFERABLE ONLY IN THE NOTE REGISTER OF THE COMPANY, UPON SURRENDER OF THIS NOTE FOR THE TRANSFER TO THE NOTE REGISTRAR DULY ENDORSED BY, OR ACCOMPANIED BY A WRITTEN INSTRUMENT OF TRANSFER IN FORM SATISFACTORY TO THE NOTE REGISTRAR DULY EXECUTED BY, THE REGISTERED HOLDER HEREOF OR HIS ATTORNEY DULY AUTHORIZED IN WRITING, AND THEREUPON, SUBJECT TO THE TERMS HEREOF, ONE OR MORE NEW NOTES FOR THE SAME AGGREGATE PRINCIPAL AMOUNT WILL BE ISSUED TO THE DESIGNATED TRANSFEREE OR TRANSFEREES. No A- $__________ RENAISSANCE ENTERTAINMENT CORPORATION 10% CONVERTIBLE SECURED NOTE THIS NOTE is one of a duly authorized issue of Notes of Renaissance Entertainment Corporation, a corporation duly organized and existing under the laws of the State of Colorado (the "Company"), designated as its 10% Convertible Secured Notes, in an aggregate principal amount not exceeding $350,000, issued pursuant to that certain Subscription and Purchase Agreement dated April __, 1997, between the Company and the original purchasers of the Notes (the "Purchase Agreement"). Reference is hereby made to the Purchase Agreement for a complete description of the rights and obligations of, and limitations and restrictions on, the Company and the Holder of this Note. The terms and conditions of the Note noted hereinafter are subject in every respect to the terms and conditions of the Purchase Agreement. In the event of a conflict between the provisions of this Note and the Purchase Agreement, the Purchase Agreement shall control. FOR VALUE RECEIVED, the Company promises to pay to ____________________ the registered holder hereof (the "Holder"), 199the principal sum of _. _____________________________________ (Name) (Please Print) $__________________________________ ), on October 31, 1997, subject to acceleration in certain events, and to pay interest on October 31, 1997 on the principal sum outstanding from time to time after as well as before maturity and default and after judgment, at the rate of 10% per annum accruing from the date of initial issuance. All accrued and unpaid interest shall bear interest at the same rate as the due date of the interest payment until paid but shall not be subject to conversion. The interest and principal so payable on October 31, 1997, will, as provided in the Purchase Agreement, be paid to the person in whose name this Note (Signatureor one or more predecessor Notes) __________________________________ is registered on the records of the Company regarding registration and transfers of the Notes (Mailing Address) __________________________________ (Registration Instructions) THIS SUBSCRIPTION IS ACCEPTED BY THE COMPANY ON THE __ DAY OF _______________199_. HEALTHWATCH, INC. By: __________________________________ Its _____________________________ EXHIBIT A CERTIFICATE OF THE DESIGNATION, PREFERENCES, RIGHTS AND LIMITATIONS OF THE SERIES B CONVERTIBLE PREFERRED STOCK OF HEALTHWATCH, INC. HealthWatch, Inc., hereinafter called the "CorporationNote Register") on the Payment Date; provided, a corporation organized and existing under the Minnesota Business Corporation Act does hereby certify that, pursuant to authority conferred upon the Board of Directors by the Articles of Incorporation, as amended, of the Corporation, said Board of Directors at a meeting duly called and held on November __, 1996, and at which a quorum was at all times present, duly adopted a Resolution providing for the issuance of a series of 500,000 shares of Series B Convertible Preferred Stock, which Resolution is as follows: "RESOLVEDhowever, that pursuant the Company's obligation to the authority expressly granted to and vested in the Board of Directors a transferee of this Corporation Note arises only if such transfer, sale or other disposition is made in accordance with the terms and conditions of the Purchase Agreement. The principal of, and interest on, this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts, at the address last appearing on the Note Register of the Company as designated in writing by the Holder from time to time. The Company will pay principal and interest on this Note by sending a check for such interest due, less any amounts required by law to be deducted, to the registered holder of this Note and addressed to such holder at the last address appearing on the Note Register. The forwarding of such check shall constitute a payment of principal and interest hereunder unless such check is not paid at par. This Note is subject to the following additional provisions: 1. The Notes are issuable in denominations of Ten Thousand Dollars ($10,000) and integral multiples thereof. As provided in the Purchase Agreement, the Notes are exchangeable for an equal aggregate principal amount of Notes of different authorized denominations, as requested by the Holders surrendering the same. No service charge will be made for such registration of transfer or exchange; however, the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with the transfer or exchange of this Note. 2. The Company shall be entitled to withhold from all payments of principal of, and interest on, this Note any amounts required to be withheld under the applicable provisions of the United States income tax laws or other applicable laws at the time of such payments. 3. This Note has been issued and, subject to the exercise of certain registration rights as provided in the Purchase Agreement, any shares of Common Stock issued upon conversion hereof, will be issued subject to investment representations and may be transferred or exchanged only as provided in the Purchase Agreement. Prior to due presentment for transfer of this Note, the Company and any agent of the Company may treat the Person in whose name this Note is duly registered on the Company's Note Register as the owner hereof for the purpose of receiving payment as herein provided and for all other purposes, whether or not this Note be overdue, and neither the Company nor any such agent shall be affected by notice to the contrary. 4. If an Event of Default occurs and is continuing, the Holders of not less than Twenty-five Percent (25%) in principal amount of the 10% Convertible Secured Notes then outstanding may declare the principal of all such Notes to be immediately due and payable in the manner and to the extent provided in the Purchase Agreement, and such declarations may be in certain events rescinded, in the manner and with the effect provided in the Purchase Agreement. 5. Subject to the provisions of the Purchase Agreement, the Holder of this Note is entitled, at its Articles option, at any time until maturity hereof to convert the principal amount of Incorporationthis Note and any accrued interest with respect thereto or any portion of the principal amount hereof and interest payable thereon which is at least Five Thousand Dollars ($5,000) or, as amendedif at the time of such election to convert the aggregate principal amount of all Notes registered to the Holder is less than Five Thousand Dollars ($5,000), a series then the whole amount thereof, into shares of Preferred Common Stock of the Corporation be and it hereby is given Company at a conversion price equal to the distinctive designation lesser of "Series B Convertible Preferred Stock" (hereinafter referred to as the "Series B Stock"), said Series to consist of Five Hundred Thousand (500,000) shares of the stated value of Two Dollars and TwentyOne Dollar Seventy-Five Cents ($2.251.75) per shareshare or 50% of the then market price (as defined in the Purchase Agreement) of a share of Common Stock (or at the current adjusted conversion price if an adjustment has been made as provided in the Purchase Agreement), upon surrender of this Note to the Company at its office in Boulder, Colorado, with the form of conversion notice attached hereto as Exhibit A executed by the Holder of this Note evidencing such Holder's intention to convert this Note or a specified portion (as above provided) hereof, and accompanied, if required by the Company, by proper assignment hereof in blank. Accrued but unpaid interest is subject to conversion. As provided in the Purchase Agreement, the conversion price is subject to adjustment in certain events. Subject to the foregoing, no adjustment is to be made upon any conversion for dividends on securities issued on such conversion or for interest accrued hereon. As further provided in the Purchase Agreement, in the case of any capital reorganization, certain reclassifications of the Common Stock, the consolidation or merger of the Company with or into any other corporation or the disposition of the properties and assets of the Company, as, or substantially as, an entirety to any other corporation, this Note shall thereafter cease to be convertible into Common Stock and shall be convertible into the shares of stock or other securities or property (including cash) to which the holders of Common Stock are entitled upon such capital reorganization, reclassification, consolidation, merger or disposition. No fractions of shares or scrip representing fractions of shares will be issued on conversion, but an adjustment in cash will be made for any fractional interest as provided in the Purchase Agreement. 6. The preferences Purchase Agreement contains provisions permitting the Holders of a majority of the aggregate principal amount of all such Notes at the time outstanding, on behalf of the Holders of all the Notes, to waive compliance by the Company with certain provisions of the Purchase Agreement and relativecertain past defaults under the Purchase Agreement and their consequences. Any such consent or waiver shall be conclusive and binding upon all Holders and upon all future Holders of this Note and of any note issued upon registration of transfer hereof or in exchange herefor or in lieu hereof whether or not notation of such consent or waiver is made upon this Note. 7. No reference herein to the Purchase Agreement and no provision of this Note or of the Purchase Agreement shall alter or impair the obligation of the Company, participatingwhich is absolute and unconditional, optional or other special rightsto pay the principal of, and interest on, this Note at the qualificationstime, limitations place and rate, and in the coin or restrictions thereof currency, herein prescribed. This Note and all other Notes now or hereafter issued under the Purchase Agreement are direct obligations of the Company. This Note ranks equally and ratably with all other Notes now or hereafter issued under the Purchase Agreement. 8. No recourse shall be had for the payment of the principal of, or the interest on, this Note, or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the Purchase Agreement or any Purchase Agreement supplemental thereto, against any incorporator, shareholder, officer or director, as follows:such, past, present or future, of the Company or any successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issue hereof, expressly waived and released. 9. The Holder of this Note, by acceptance hereof, agrees that this Note is being and any shares of Common Stock acquired pursuant to the conversion of this Note will, unless such condition is waived by the Company, be acquired for investment and that such Holder will not offer, sell or otherwise dispose of this Note or such Common Stock except under circumstances which will not result in a violation of the 1933 Act or any applicable state Blue Sky law. This Note and any certificate for shares of Common Stock issued upon conversion hereof, unless such requirement is waived by the Company, shall bear a legend in substantially the following form: THE SECURITIES DESCRIBED HEREIN, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT",) OR UNDER THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. NO SALE OR DISTRIBUTION OF THESE SECURITIES MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE 1933 ACT AND APPLICABLE STATE BLUE SKY LAWS. 10. All terms used in this Note which are defined in the Purchase Agreement shall have the meanings assigned to them in the Purchase Agreement. 11. This Note shall be governed by and construed in accordance with the laws of the State of Colorado.

RESALE COMPLIANCE. The undersigned agrees to comply with the 1933 Act and the rules and regulations promulgated thereunder, and any other relevant securities legislation and policies governing the purchase, holding and resale of the Units subscribed for, including, without limitation, applicable state Blue Sky laws. Entered into this ____ day of November, 1996. ____________, 199_. __________________________________ (Name) (Please Print) ___________________________________ (Signature) ___________________________________ (Mailing Address) ___________________________________ (Registration Instructions) THIS SUBSCRIPTION IS ACCEPTED BY THE COMPANY ON THE __ DAY OF _______________199_NOVEMBER 1996. HEALTHWATCH, INC. By: ___________________________________ Its __Its___________________________ EXHIBIT A CERTIFICATE OF THE DESIGNATION, PREFERENCES, RIGHTS AND LIMITATIONS OF THE SERIES B CONVERTIBLE PREFERRED STOCK OF HEALTHWATCH, INC. HealthWatch, Inc., hereinafter called the "Corporation", a corporation organized and existing under the Minnesota Business Corporation Act does hereby certify that, pursuant to authority conferred upon the Board of Directors by the Articles of Incorporation, as amended, of the Corporation, said Board of Directors at a meeting duly called and held on November __, 1996, and at which a quorum was at all times present, duly adopted a Resolution providing for the issuance of a series of 500,000 shares of Series B Convertible Preferred Stock, which Resolution is as follows: "RESOLVED, that pursuant to the authority expressly granted to and vested in the Board of Directors of this Corporation in accordance with the provisions of its Articles of Incorporation, as amended, a series of Preferred Stock of the Corporation be and it hereby is given the distinctive designation of "Series B Convertible Preferred Stock" (hereinafter referred to as the "Series B Stock"), said Series to consist of Five Hundred Thousand (500,000) shares of the stated value of Two Dollars and Twenty-Five Cents ($2.25) per share. The preferences and relative, participating, optional or other special rights, and the qualifications, limitations or restrictions thereof shall be as follows:

RESALE COMPLIANCE. The undersigned agrees to comply with the 1933 Act and the rules and regulations promulgated thereunder, and any other relevant securities legislation and policies governing the purchase, holding and resale of the Units Debentures subscribed for, including, without limitation, applicable state Blue Sky blue sky laws. The undersigned acknowledges that this subscription shall not be effective unless accepted by the Company as indicated below. Entered into this ____ 8th day of ____________May, 199_1997. __________________________________ Xxxxxxx X. Xxxxxxx -------------------------------- (Name) (Please Print) __________________________________ -------------------------------- (Signature) __________________________________ -27- -------------------------------- (Mailing Address) __________________________________ -------------------------------- (Registration Instructions) -------------------------------- (Social Security or Tax Identification No.) THIS SUBSCRIPTION IS ACCEPTED BY THE COMPANY ON THE __ 8TH DAY OF _______________199_MAY, 1997. HEALTHWATCH, INC. RENAISSANCE ENTERTAINMENT CORPORATION By: __________________________________ Its _____________________________ EXHIBIT A CERTIFICATE ------------------------------ Xxxxxxx X. Xxxxxxx, Chief Executive Officer THE SECURITIES DESCRIBED HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE 1933 ACT") OR UNDER THE SECURITIES LAWS OF ANY STATE OF THE DESIGNATION, PREFERENCES, RIGHTS AND LIMITATIONS UNITED STATES. NO REGULATORY BODY HAS ENDORSED THESE SECURITIES. NO SALE OR DISTRIBUTION OF THE SERIES B SECURITIES MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE 1933 ACT AND APPLICABLE STATE BLUE SKY LAWS. No. D-1 $500,000.00 RENAISSANCE ENTERTAINMENT CORPORATION 9% CONVERTIBLE PREFERRED STOCK OF HEALTHWATCH, INC. HealthWatch, Inc., hereinafter called the "SECURED DEBENTURE DUE 2002 THIS DEBENTURE is one of a duly authorized issue of Debentures of Renaissance Entertainment Corporation", a corporation duly organized and existing under the Minnesota Business Corporation Act does hereby certify thatlaws of the State of Colorado (the "Company"), designated as its 9% Convertible Secured Debentures Due 2002, in an aggregate principal amount not exceeding $1,500,000, issued pursuant to authority conferred upon that certain Subscription and Purchase Agreement dated May 8, 1997, between the Board Company and the original purchasers of Directors by the Articles Debentures (the "Purchase Agreement"). Reference is hereby made to the Purchase Agreement for a complete description of Incorporationthe rights and obligations of, and limitations and restrictions on, the Company and the Holder of this Debenture. The terms and conditions of the Debenture noted hereinafter are subject in every respect to the terms and conditions of the Purchase Agreement. In the event of a conflict between the provisions of this Debenture and the Purchase Agreement, the Purchase Agreement shall control. FOR VALUE RECEIVED, the Company promises to pay to Xxxxxxx X. Xxxxxxx the registered holder hereof (the "Holder"), the principal sum of Five Hundred Thousand Dollars ($500,000.00), on April 1, 2002, subject to acceleration in certain events, and to pay interest on the principal sum outstanding from time to time quarterly in arrears on the first business day of each calendar quarter of each year ("Interest Payment Dates"), after as well as before maturity and default and after judgment, at the rate of 9% per annum accruing from the date of initial issuance. Payment of interest shall commence on the first such business day to occur after the date hereof (and shall be pro rated for such period from the date of initial issuance) and shall continue on the first business day of each succeeding calendar quarter until payment in full of the principal sum has been made or duly provided for. All accrued and unpaid interest shall bear interest at the same rate as the due date of the interest payment until paid but shall not be subject to conversion. December 15, March 15, June 15 and September 15 of each year shall serve as the record date (the "Record Date") for determining ownership of this Debenture with respect to payments of interest to be made on the following Interest Payment Date. The interest so payable on any Interest Payment Date will, as amendedprovided in the Purchase Agreement, be paid to the person in whose name this Debenture (or one or more predecessor Debentures) is registered on the records of the CorporationCompany regarding registration and transfers of the Debentures (the "Debenture Register") at the Record Date for such Interest Payment Date; provided, said Board of Directors at a meeting duly called and held on November __, 1996, and at which a quorum was at all times present, duly adopted a Resolution providing for the issuance of a series of 500,000 shares of Series B Convertible Preferred Stock, which Resolution is as follows: "RESOLVEDhowever, that pursuant the Company's obligation to the authority expressly granted to and vested in the Board of Directors a transferee of this Corporation Debenture arises only if such transfer, sale or other disposition is made in accordance with the terms and conditions of the Purchase Agreement. The principal of, and interest on, this Debenture are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts, at the address last appearing on the Debenture Register of the Company as designated in writing by the Holder from time to time. The Company will pay interest on this Debenture by sending a check for such interest due, less any amounts required by law to be deducted, to the registered holder of this Debenture and addressed to such holder at the last address appearing on the Debenture Register. The forwarding of such check shall constitute a payment of interest hereunder and shall satisfy and discharge the liability for interest on this Debenture to the extent of the sum represented by such check plus any amounts so deducted unless such check is not paid at par. This Debenture is subject to the following additional provisions: 1. All terms used in this Debenture which are defined in the Purchase Agreement shall have the meanings assigned to them in the Purchase Agreement. 2. The Debentures are issuable in denominations of Fifty Thousand Dollars ($50,000) and integral multiples thereof. As provided in the Purchase Agreement, the Debentures are exchangeable for an equal aggregate principal amount of Debentures of different authorized denominations, as requested by the Holders surrendering the same. No service charge will be made for such registration of transfer or exchange; however, the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with the transfer or exchange of this Debenture. 3. The Company shall be entitled to withhold from all payments of principal of, and interest on, this Debenture any amounts required to be withheld under the applicable provisions of the United States income tax laws or other applicable laws at the time of such payments. 4. This Debenture has been issued and, subject to the exercise of certain registration rights as provided in the Purchase Agreement, any shares of Common Stock issued upon conversion hereof, will be issued subject to investment representations and may be transferred or exchanged only as provided in the Purchase Agreement. Prior to due presentment for transfer of this Debenture, the Company and any agent of the Company may treat the Person in whose name this Debenture is duly registered on the Company's Debenture Register as the owner hereof for the purpose of receiving payment as herein provided and for all other purposes, whether or not this Debenture be overdue, and neither the Company nor any such agent shall be affected by notice to the contrary. 5. If an Event of Default occurs and is continuing, the Holders of not less than Fifteen Percent (15%) in principal amount of the 9% Convertible Secured Debentures then outstanding may declare the principal of all such Debentures to be immediately due and payable in the manner and to the extent provided in the Purchase Agreement, and such declarations may be in certain events rescinded, in the manner and with the effect provided in the Purchase Agreement. 6. Subject to the provisions of the Purchase Agreement, the Holder of this Debenture is entitled, at its Articles option, at any time after April 30, 1998, until maturity hereof to convert the principal amount of Incorporationthis Debenture or any portion of the principal amount hereof which is at least Ten Thousand Dollars ($10,000) or, as amendedif at the time of such election to convert the aggregate principal amount of all Debentures registered to the Holder is less than Ten Thousand Dollars ($10,000), a series then the whole amount thereof, into shares of Preferred Common Stock of the Corporation be and it hereby is given Company at the distinctive designation lesser of "Series B Convertible Preferred Stock" (hereinafter referred to as the "Series B Stock"), said Series to consist of Five Hundred Thousand (500,000) shares of the stated value of Two Four Dollars and Twenty-Five Fifty Cents ($2.254.50) per shareshare (subject to adjustment as provided in the Purchase Agreement) or Seventy (70) percent of the fair market value (as defined) of the Company's Common Stock on the Date of Conversion, upon surrender of this Debenture to the Company at its office in Boulder, Colorado, with the form of conversion notice attached hereto as Exhibit A executed by the Holder of this Debenture evidencing such Holder's intention to convert this Debenture or a specified portion (as above provided) hereof, and accompanied, if required by the Company, by proper assignment hereof in blank. No amount of accrued but unpaid interest shall be subject to conversion. As provided in the Purchase Agreement, the conversion price is subject to adjustment in certain events. 7. The preferences Purchase Agreement contains provisions permitting the Holders of a majority of the aggregate principal amount of all such Debentures at the time outstanding, on behalf of the Holders of all the Debentures, to waive compliance by the Company with certain provisions of the Purchase Agreement and relativecertain past defaults under the Purchase Agreement and their consequences. Any such consent or waiver shall be conclusive and binding upon all Holders and upon all future Holders of this Debenture and of any debenture issued upon registration of transfer hereof or in exchange herefor or in lieu hereof whether or not notation of such consent or waiver is made upon this Debenture. 8. No reference herein to the Purchase Agreement and no provision of this Debenture or of the Purchase Agreement shall alter or impair the obligation of the Company, participatingwhich is absolute and unconditional, optional or other special rightsto pay the principal of, and interest on, this Debenture at the qualificationstime, limitations place and rate, and in the coin or restrictions thereof currency, herein prescribed. This Debenture and all other Debentures now or hereafter issued under the Purchase Agreement are direct obligations of the Company. This Debenture ranks equally and ratably with all other Debentures now or hereafter issued under the Purchase Agreement. 9. No recourse shall be had for the payment of the principal of, or the interest on, this Debenture, or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the Purchase Agreement or any Purchase Agreement supplemental thereto, against any incorporator, shareholder, officer or director, as follows:such, past, present or future, of the Company or any successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issue hereof, expressly waived and released. 10. The Holder of this Debenture, by acceptance hereof, agrees that this Debenture is being and any shares of Common Stock acquired pursuant to the conversion of this Debenture will, unless such condition is waived by the Company, be acquired for investment and that such Holder will not offer, sell or otherwise dispose of this Debenture or such Common Stock except under circumstances which will not result in a violation of the 1933 Act or any applicable state Blue Sky law. This Debenture and any certificate for shares of Common Stock issued upon conversion hereof, unless such requirement is waived by the Company, shall bear a legend in substantially the following form: THE SECURITIES DESCRIBED HEREIN, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT",) OR UNDER THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. NO SALE OR DISTRIBUTION OF THESE SECURITIES MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE 1933 ACT AND APPLICABLE STATE BLUE SKY LAWS. 11. This Debenture shall be governed by and construed in accordance with the laws of the State of Colorado.