THIS NOTE AND THE COMMON SHARES ISSUABLE UPON CONVERSION OF THIS NOTE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
STATE SECURITIES LAWS. THIS NOTE AND THE COMMON SHARES ISSUABLE UPON
CONVERSION OF THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS
TO THIS NOTE UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR
AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO ON THE GO HEALTHCARE,
INC. THAT SUCH REGISTRATION IS NOT REQUIRED.
AMENDED AND RESTATED SECURED CONVERTIBLE TERM NOTE
FOR VALUE RECEIVED, ON THE GO HEALTHCARE, INC., a Delaware Corporation
(the "Borrower") promises to pay to LAURUS MASTER FUND, LTD., c/o M&C
Corporate Services Limited, P.O. Box 309 GT, Xxxxxx House, South Church
Street, Xxxxxx Town, Grand Cayman, Cayman Islands, Fax: 000-000-0000
(the "Holder") or its registered assigns or successors in interest,
on order, the sum of Five Hundred Thousand Dollars in lawful money of
the United States (US$500,000), together with any accrued and unpaid
interest hereon, on July 14, 2008 (the "Maturity Date") if not sooner
indefeasibly paid in full. This Note amends and restates in its
entirety (and is given in substitution for and not in satisfaction of)
that certain $500,000 Secured Convertible Term Note made by the Company
in favor of Holder on July 14, 2005 and amended and restated on
January 13, 2006.
Capitalized terms used herein without definition shall have the
meanings ascribed to such terms in the Security and Purchase Agreement
between the Company and the Holder dated as of the date hereof (as
amended, modified and/or supplemented from time to time, the "Security
Agreement").
The following terms shall apply to this Amended and Restated Secured
Convertible Term Note (this "Note"):
ARTICLE I
CONTRACT RATE AND AMORTIZATION
1.1 Contract Rate. Subject to Sections 4.2 and 5.10, interest payable on the
outstanding principal amount of this Note (the "Principal Amount") shall
accrue at a rate per annum equal to the "prime rate" published in The
Wall Street Journal from time to time (the "Prime Rate"), plus two percent
(2.0%) (the "Contract Rate"). The Contract Rate shall be increased or
decreased as the case may be for each increase or decrease in the Prime
Rate in an amount equal to such increase or decrease in the Prime Rate;
each change to be effective as of the day of the change in the Prime Rate.
The Contract Rate shall not at any time be less
than eight percent (8.0%). Interest shall be (i) calculated on the basis
of a 360 day year, and (ii) payable monthly, in arrears, commencing on
August 1, 2005, on the first business day of each consecutive calendar
month thereafter through and including the Maturity Date, and on the
Maturity Date, whether by acceleration or otherwise.
1
1.2 Contract Rate Payments. The Contract Rate shall be
calculated on the last business day of each calendar month hereafter
(other than for increases or decreases in the Prime Rate which shall be
calculated and become effective in accordance with the terms of
Section 1.1) until the Maturity Date (each a "Determination Date")
1.3 Principal Payments. Amortizing payments of the aggregate principal
amount outstanding under this Note at any time (the "Principal Amount")
shall be made by the Company on December 1, 2005 and on the first
business day of each succeeding month thereafter through and including
the Maturity Date (each, an "Amortization Date"). Subject to
Article III below, commencing on the first Amortization Date, the
Company shall make monthly payments to the Holder on each Repayment
Date, each such payment in the amount of $15,625 together with any
accrued and unpaid interest on such portion of the Principal Amount
plus any and all other unpaid amounts which are then owing under this
Note, the Purchase Agreement and/or any other Related Agreement
(collectively, the "Monthly Amount"). Any outstanding Principal
Amount together with any accrued and unpaid interest and any and
all other unpaid amounts which are then owing by the Company to the
Holder under this Note, the Purchase Agreement and/or any other
Related Agreement shall be due and payable on the Maturity Date.
1.4 Currency. All principal, interest and other amounts owing under
this Note, the Security Agreement or any Ancillary Agreement that, in
accordance with their terms, are to be paid in cash shall be paid in
US dollars. All amounts denominated in other currencies shall be
converted to the US dollar equivalent amount in accordance with the
Exchange Rate on the date of calculation. "Exchange Rate" means, in
relation to any amount of currency to be converted into US dollars
pursuant to this Note, the Security Agreement or any Ancillary Agreement,
the US dollar exchange rate as published in the Wall Street Journal on
the relevant date of calculation.
2
1.5 Taxes.
(a) If permissible by law, any and all payments by the Borrower
hereunder, including any amounts received on a conversion or
redemption of this Note and any amounts on account of interest
or deemed interest, shall be made free and clear of and without
deduction for any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, charged, levied,
imposed or required to be deducted or withheld by any federal,
state or provincial government or other political subdivision
and any agency, department or other entity exercising executive,
legislative judicial, regulatory or administrative functions of
or pertaining to such government ("Government Authority"), and
all liabilities with respect thereto, excluding, for certainty,
taxes imposed on net income or profit and capital, capital gains,
sales or franchise taxes of the Holder (all such non-excluded
taxes, levies, imposts, deductions, charges withholdings and
liabilities, collectively or individually, "Taxes"). The Company
covenants and agrees that if a Borrower shall be required to
deduct any Taxes from or in respect of any sum payable hereunder
to the Holder, (i) the sum payable shall be increased by the
amount (an "additional amount") necessary so that after making
all required deductions (including deductions applicable to
additional sums payable under this Section 1.5) the Holder shall
receive an amount equal to the sum it would have received had no
such deductions been made, (ii) the Borrower shall make such
deductions and (iii) the Borrower shall pay the full amount
deducted to the relevant Governmental Authority in accordance
with applicable law.
(b) In addition, the Company hereby agrees to pay to the relevant
Governmental Authority in accordance with applicable law any
present or future stamp or documentary taxes or any other
excise or property taxes, charges or similar levies that arise
from any payment made hereunder or from the execution, delivery
or registration of, or otherwise with respect to, this Note ("Other
Taxes"). The Company further covenants and agrees that the
Borrower shall deliver to the Holder official receipts, if any,
in respect of any Taxes or Other Taxes payable hereunder promptly
after payment of such Taxes or Other Taxes or other evidence of
payment reasonably acceptable to the Holder.
(c) The Company hereby indemnifies and agrees to hold the Holder
harmless from and against Taxes and Other Taxes (including, without
limitation, Taxes and Other Taxes imposed on any amounts payable
under this Section 1.5) paid by the Holder, whether or not such
Taxes or Other Taxes were correctly or legally asserted. Such
indemnification shall be paid within ten (10) days from the date
on which the Holder makes written demand therefor specifying in
reasonable detail the nature and amount of such Taxes or Other
Taxes.
(d) The obligations of the Company under this Section 1.5 shall
survive the termination and the payment of this Note and all
other amounts payable hereunder.
3
ARTICLE II
CONVERSION AND REDEMPTION
2.1 Payment of Monthly Amount.
(a) Payment in Cash or Common Stock. If the Monthly Amount (or a
portion of such Monthly Amount if not all of the Monthly Amount
may be converted into shares of Common Stock pursuant to
Section 3.2) is required to be paid in cash pursuant to
Section 2.1(b), then the Company shall pay the Holder an amount
in cash equal to 100% of the Monthly Amount (or such portion of
such Monthly Amount to be paid in cash) due and owing to the
Holder on the Amortization Date. If the Monthly Amount (or a
portion of such Monthly Amount if not all of the Monthly Amount
may be converted into shares of Common Stock pursuant to
Section 3.2) is required to be paid in shares of Common Stock
pursuant to Section 2.1(b), the number of such shares to be
issued by the Company to the Holder on such Amortization Date
(in respect of such portion of the Monthly Amount converted
into shares of Common Stock pursuant to Section 2.1(b)), shall
be the number determined by dividing (i) the portion of the
Monthly Amount converted into shares of Common Stock, by (ii)
the then applicable Fixed Conversion Price. For purposes hereof,
subject to Section 3.6 hereof, the initial "Fixed Conversion
Price" means $.50.
(b) Monthly Amount Conversion Conditions. Subject to Sections
2.1(a), 2.2, and 3.2 hereof, the Holder shall convert into shares
of Common Stock all or a portion of the Monthly Amount due on
each Amortization Date if the following conditions (the
"Conversion Criteria") are satisfied: (i) the average closing
price of the Common Stock as reported by Bloomberg, L.P. on the
Principal Market for the five (5) trading days immediately
preceding such Amortization Date shall be greater than or equal
to one hundred fifteen percent (115%) of the Fixed Conversion
Price and (ii) the amount of such conversion does not exceed
twenty five percent (25%) of the aggregate dollar trading volume
of the Common Stock for the period of twenty-two (22) trading
days immediately preceding such Amortization Date. If subsection
(i) of the Conversion Criteria is met but subsection (ii) of the
Conversion Criteria is not met as to the entire Monthly Amount,
the Holder shall convert only such part of the Monthly Amount
that meets subsection (ii) of the Conversion Criteria. Any
portion of the Monthly Amount due on an Amortization Date that
the Holder has not been able to convert into shares of Common
Stock due to the failure to meet the Conversion Criteria, shall
be paid in cash by the Company at the rate of 100% of the Monthly
Amount otherwise due on such Amortization Date, within three
(3) business days of such Amortization Date.
4
2.2 No Effective Registration. Notwithstanding anything to the contrary
herein, none of the Company's obligations to the Holder may be converted
into Common Stock unless (a) either (i) an effective current Registration
Statement (as defined in the Registration Rights Agreement) covering the
shares of Common Stock to be issued in connection with satisfaction of
such obligations exists or (ii) an exemption from registration for resale
of all of the Common Stock issued and issuable is available pursuant to
Rule 144 of the Securities Act and (b) no Event of Default (as hereinafter
defined) exists and is continuing, unless such Event of Default is cured
within any applicable cure period or otherwise waived in writing by the
Holder.
2.3 Optional Redemption in Cash. The Company may prepay this Note ("Optional
Redemption") by paying to the Holder a sum of money equal to one
hundred thirty percent (130%) of the Principal Amount outstanding at
such time together with accrued but unpaid interest thereon and any and
all other sums due, accrued or payable to the Holder arising under this
Note, the Purchase Agreement or any other Related Agreement (the
"Redemption Amount") outstanding on the Redemption Payment Date (as
defined below). The Company shall deliver to the Holder a written
notice of redemption (the "Notice of Redemption") specifying the date
for such Optional Redemption (the "Redemption Payment Date"), which date
shall be seven (7) business days after the date of the Notice of
Redemption (the "Redemption Period"). A Notice of Redemption shall not
be effective with respect to any portion of this Note for which the
Holder has previously delivered a Notice of Conversion (as hereinafter
defined) or for conversions elected to be made by the Holder pursuant
to Section 3.3 during the Redemption Period. The Redemption Amount
shall be determined as if the Holder's conversion elections had been
completed immediately prior to the date of the Notice of Redemption.
On the Redemption Payment Date, the Redemption Amount must be paid in
good funds to the Holder. In the event the Company fails to pay the
Redemption Amount on the Redemption Payment Date as set forth herein,
then such Redemption Notice will be null and void.
ARTICLE III
HOLDER'S CONVERSION RIGHTS
3.1 Optional Conversion. Subject to the terms set forth in this
Article III, the Holder shall have the right, but not the obligation, to
convert all or any portion of the issued and outstanding Principal Amount
and/or accrued interest and fees due and payable into fully paid and
nonassessable shares of Common Stock at the Fixed Conversion Price.
The shares of Common Stock to be issued upon such conversion are herein
referred to as, the "Conversion Shares."
3.2 Conversion Limitation. Notwithstanding anything contained herein to
the contrary, the Holder shall not be entitled to convert pursuant to the
terms of this Note an amount that would be convertible into that number
of Conversion Shares which would exceed the difference between (i) 4.99%
of the outstanding shares of Common Stock and (ii) the number of shares
of Common Stock beneficially owned by the Holder. For purposes of the
immediately preceding sentence, beneficial ownership shall be determined
in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3
thereunder. The Conversion Shares limitation described in this Section 3.2
shall automatically become null and void following notice to any Company
upon the occurrence and during the continuance of an Event of Default,
or upon 75 days prior notice to the Borrower. Notwithstanding anything
contained herein to the contrary, the provisions of this Section 3.2 are
irrevocable and may not be waived by the Holder or any Company. The
Holder shall be solely responsible for determining its ownership pursuant
to this Section 3.2.
5
3.3 Mechanics of Xxxxxx's Conversion.
In the event that the Holder elects to convert this Note into Common
Stock, the Holder shall give notice of such election by delivering an
executed and completed notice of conversion in substantially the form
of Exhibit B hereto (appropriate completed) ("Notice of Conversion")
to the Company and such Notice of Conversion shall provide a breakdown
in reasonable detail of the Principal Amount, accrued interest and
fees that are being converted. On each Conversion Date (as hereinafter
defined) and in accordance with its Notice of Conversion, the Holder
shall make the appropriate reduction to the Principal Amount, accrued
interest and fees as entered in its records and shall provide written
notice thereof to the Company within two (2) business days after the
Conversion Date. Each date on which a Notice of Conversion is
delivered or telecopied to the Company in accordance with the
provisions hereof shall be deemed a Conversion Date (the "Conversion
Date"). Pursuant to the terms of the Notice of Conversion, the
Company will issue instructions to the transfer agent accompanied by
an opinion of counsel within one (1) business day of the date of the
delivery to the Company of the Notice of Conversion and shall cause
the transfer agent to transmit the certificates representing the
Conversion Shares to the Holder by crediting the account of the
Holder's designated broker with the Depository Trust Corporation
("DTC") through its Deposit Withdrawal Agent Commission ("DWAC")
system within three (3) business days after receipt by the Borrower
of the Notice of Conversion (the "Delivery Date"). In the case of
the exercise of the conversion rights set forth herein the
conversion privilege shall be deemed to have been exercised and
the Conversion Shares issuable upon such conversion shall be
deemed to have been issued upon the date of receipt by the
Borrower of the Notice of Conversion. The Holder shall be
treated for all purposes as the record holder of the Conversion
Shares, unless the Holder provides the Borrower written
instructions to the contrary.
3.4 Late Payments. The Borrower understands that a delay in the delivery
of the Conversion Shares in the form required pursuant to this Article
beyond the Delivery Date could result in economic loss to the Holder.
As compensation to the Holder for such loss, in addition to all other
rights and remedies which the Holder may have under this Note, applicable
law or otherwise, the Borrower shall pay late payments to the Holder for
any late issuance of Conversion Shares in the form required pursuant to
this Article II upon conversion of this Note, in the amount equal to
$500 per business day after the Delivery Date. The Borrower shall make
any payments incurred under this Section in immediately available funds
upon demand.
6
3.5 Conversion Mechanics. 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 and interest and fees to be converted, if any,
by the then applicable Fixed Conversion Price. In the event of any
conversions of a portion of the outstanding Principal Amount pursuant to
this Article III, such conversions shall be deemed to constitute
conversions of the outstanding Principal Amount applying to Monthly
Amounts for the remaining Amortization Dates in chronological order.
3.6 Adjustment Provisions. The Fixed Conversion Price and number and kind
of shares or other securities to be issued upon conversion determined
pursuant to this Note shall be subject to adjustment from time to time
upon the occurrence of certain events during the period that this
conversion right remains outstanding, as follows:
(a) Reclassification. If the Borrower 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,
this Note, as to the unpaid Principal Amount 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 Common Stock (i) immediately prior
to or (ii) immediately after, such reclassification or other
change at the sole election of the Holder.
(b) 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 or any preferred stock issued by the Borrower in shares of
Common Stock, the Fixed 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.
7
3.7 Reservation of Shares. During the period the conversion right exists,
the Borrower will reserve from its authorized and unissued Common Stock a
sufficient number of shares to provide for the issuance of Conversion
Shares upon the full conversion of this Note the Minimum Borrowing Note
and the Warrant. The Borrower represents that upon issuance, the
Conversion Shares will be duly and validly issued, fully paid and
non-assessable. The Borrower 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 the Conversion Shares upon the conversion of this Note.
3.8 Registration Rights. The Holder has been granted registration rights with
respect to the Conversion Shares as set forth in the Registration Rights
Agreement.
3.9 Issuance of New Note. Upon any 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 Borrower to the Holder for the
principal balance of this Note and interest which shall not have been
converted or paid. Subject to the provisions of Article IV of this Note,
the Company shall not pay any costs, fees or any other consideration to
the Holder for the production and issuance of a new Note.
8
ARTICLE IV
EVENTS OF DEFAULT
4.1 Events of Default. The occurrence of an Event of Failure or an Event of
Default under the Security Agreement shall constitute an Event of Failure
("Event of Failure") or an event of default ("Event of Default"),
respectively, hereunder:
4.2 Default Interest. Following the occurrence and during the continuance of
an Event of Default, the Company shall pay additional interest on this
Note in an amount equal to two percent (2%) per month, and all outstanding
obligations under this Note, the Purchase Agreement and each other
Related Agreement, including unpaid interest, shall continue to accrue
interest at such additional interest rate from the date of such Event
of Default until the date such Event of Default is cured or waived.
4.3 Default Payment. Following the occurrence and during the continuance of
an Event of Default, the Holder, at its option, may demand repayment in
full of all obligations and liabilities owing by Company to the Holder
under this Note, the Purchase Agreement and/or any other Related Agreement
and/or may elect, in addition to all rights and remedies of the Holder
under the Purchase Agreement and the other Related Agreements and all
obligations and liabilities of the Company under the Purchase Agreement
and the other Related Agreements, to require the Company to make a Default
Payment ("Default Payment"). The Default Payment shall be 130% of the
outstanding principal amount of the Note, plus accrued but unpaid interest,
all other fees then remaining unpaid, and all other amounts payable
hereunder. The Default Payment shall be applied first to any fees due
and payable to the Holder pursuant to this Note, the Purchase Agreement,
and/or the other Related Agreements, then to accrued and unpaid interest
due on this Note and then to the outstanding principal balance of this
Note. The Default Payment shall be due and payable immediately on the
date that the Holder has exercised its rights pursuant to this Section 4.3.
ARTICLE V
MISCELLANEOUS
5.1 Conversion Privileges. The conversion privileges set forth in Article III
shall remain in full force and effect immediately from the date hereof
until the date this Note is indefeasibly paid in full and irrevocably
terminated.
5.2 Cumulative Remedies. The remedies under this Note shall be cumulative.
5.3 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.
9
5.4 Notices. Any notice herein required or permitted to be given shall be
in writing and shall be deemed effectively given: (a) upon personal
delivery to the party notified, (b) when sent by confirmed telex or
facsimile if sent during normal business hours of the recipient, if
not, then on the next business day, (c) five days after having been
sent by registered or certified mail, return receipt requested,
postage prepaid, or (d) one day after deposit with a nationally
recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent
to the Company at the address provided in the Purchase Agreement
executed in connection herewith, and to the Holder at the address
provided in the Purchase Agreement for such Holder, with a copy to
Xxxx X. Xxxxxx, Esq., 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx
Xxxx 00000, xxxxxxxxx number (000) 000-0000, or at such other address
as the Company or the Holder may designate by ten days advance written
notice to the other parties hereto. A Notice of Conversion shall be
deemed given when made to the Company pursuant to the Purchase Agreement.
5.5 Amendment Provision. The term "Note" and all references 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, and any successor instrument as such successor instrument
may be amended or supplemented.
5.6 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, and may be assigned by the Holder in
accordance with the requirements of the Purchase Agreement. The
Company may not assign any of its obligations under this Note without
the prior written consent of the Holder, any such purported assignment
without such consent being null and void.
5.7 Cost of Collection. In case of any Event of Default under this Note,
the Company shall pay the Holder reasonable costs of collection,
including reasonable attorneys' fees.
5.8 Governing Law, Jurisdiction and Waiver of Jury Trial.
(a) THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW.
(b) THE COMPANY HEREBY CONSENTS AND AGREES THAT THE STATE OR
FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF
NEW YORK SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND
DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THE COMPANY, ON THE
ONE HAND, AND THE HOLDER, ON THE OTHER HAND, PERTAINING TO THIS
NOTE OR ANY OF THE OTHER RELATED AGREEMENTS OR TO ANY MATTER
ARISING OUT OF OR RELATED TO THIS NOTE OR ANY OF THE RELATED
AGREEMENTS; PROVIDED, THAT THE COMPANY ACKNOWLEDGES THAT ANY
APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED
OUTSIDE OF THE COUNTY OF NEW YORK, STATE OF NEW YORK; AND
FURTHER PROVIDED, THAT NOTHING IN THIS NOTE SHALL BE DEEMED OR
OPERATE TO PRECLUDE THE HOLDER FROM BRINGING SUIT OR TAKING OTHER
LEGAL ACTION IN ANY OTHER JURISDICTION TO COLLECT THE OBLIGATIONS,
TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE
OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR
OF THE HOLDER. THE COMPANY EXPRESSLY SUBMITS AND CONSENTS IN
ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN
ANY SUCH COURT, AND THE COMPANY HEREBY WAIVES ANY OBJECTION WHICH
IT MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER
VENUE OR FORUM NON CONVENIENS. THE COMPANY HEREBY WAIVES PERSONAL
SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN
ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS,
COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR
CERTIFIED MAIL ADDRESSED TO THE COMPANY AT THE ADDRESS SET FORTH
IN THE PURCHASE AGREEMENT AND THAT SERVICE SO MADE SHALL BE
DEEMED COMPLETED UPON THE EARLIER OF THE COMPANY'S ACTUAL RECEIPT
THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE U.S. MAILS,
PROPER POSTAGE PREPAID.
10
(c) THE COMPANY DESIRES THAT ITS DISPUTES BE RESOLVED BY A JUDGE
APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST
COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF
ARBITRATION, THE COMPANY HERETO WAIVES ALL RIGHTS TO TRIAL
BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE
ANY DISPUTE, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE
BETWEEN THE HOLDER AND THE COMPANY ARISING OUT OF, CONNECTED
WITH, RELATED OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED
BETWEEN THEM IN CONNECTION WITH THIS NOTE, ANY OTHER RELATED
AGREEMENT OR THE TRANSACTIONS RELATED HERETO OR THERETO.
5.9 Severability. In the event that any provision of this Note is invalid
or unenforceable under any applicable statute or rule of law, then such
provision shall be deemed inoperative to the extent that it may conflict
therewith and shall be deemed modified to conform with such statute or
rule of law. Any such provision which may prove invalid or unenforceable
under any law shall not affect the validity or enforceability of any
other provision of this Note.
5.10 Maximum Payments. Nothing contained herein shall be deemed to establish
or require the payment of a rate of interest or other charges in excess
of the maximum permitted by applicable law. In the event that the rate
of interest required to be paid or other charges hereunder exceed the
maximum rate permitted by such law, any payments in excess of such
maximum rate shall be credited against amounts owed by the Company to
the Holder and thus refunded to the Company.
5.11 Security Interest. The Holder has been granted a security interest in
certain assets of the Borrower as more fully described in the Security
Agreement and pursuant to each of the Master Security Agreement, the
Subsidiary Guarantee, and the Stock Pledge Agreement, each dated as of
the date hereof.
5.12 Construction. Each party acknowledges that its legal counsel
participated in the preparation of this Note and, therefore, stipulates
that the rule of construction that ambiguities are to be resolved against
the drafting party shall not be applied in the interpretation of this
Note to favor any party against the other.
5.13 Registered Obligation. This Note is intended to be a registered
obligation within the meaning of Treasury Regulation Section
1.871-14(c)(1)(i) and the Company (or its agent) shall register this
Note (and thereafter shall maintain such registration) as to both
principal and any stated interest. Notwithstanding any document,
instrument or agreement relating to this Note to the contrary, transfer
of this Note (or the right to any payments of principal or stated
interest thereunder) may only be effected by (i) surrender of this
Note and either the reissuance by the Company of this Note to the new
holder or the issuance by the Company of a new instrument to the new
holder, or (ii) transfer through a book entry system maintained by
the Company (or its agent), within the meaning of Treasury Regulation
Section 1871-14(c)(1)(i)(B).
5.14 Judgment Currency.
(a) If for the purpose of obtaining or enforcing judgment against one
or more of the Borrower in any court in any jurisdiction it
becomes necessary to convert into any other currency (such other
currency being hereinafter in this Section 5.13 referred to as
the "Judgment Currency") an amount due in US dollars under this
Note, the conversion shall be made at the Exchange Rate prevailing
on the business day immediately preceding:
i. the date actual payment of the amount due, in the case of
any proceeding in the courts of New York or in the courts
of any other jurisdiction that will give effect to such
conversion being made on such date: or
ii. the date on which the foreign court determines, in the
case of any proceeding in the courts of any other
jurisdiction (the date as of which such conversion
is made pursuant to this Section 5.13(a)ii being
hereinafter referred to as the "Judgment Conversion
Date")
11
(b) If in the case of any proceeding in the court of any jurisdiction
referred to in Section 5.13(a)ii above, there is a change in the
Exchange Rate prevailing between the Judgment Conversion Date and
the date of actual payment of the amount due, the applicable party
(being in the case of one or more Borrower, the Company shall pay
such adjusted amount as may be necessary to ensure that the amount
paid in the Judgment Currency, when converted at the Exchange
Rate prevailing on the date of payment, will produce the amount
of US dollars which could have been purchased with the amount
of Judgment Currency stipulated in the judgment or judicial order
at the Exchange Rate prevailing on the Judgment Conversion Date.
(c) Any amount due from the Company under this provision shall be due
as a separate debt and shall not be affected by judgment being
obtained for any other amounts due under or in respect of this
Note
[Balance of page intentionally left blank; signature page follows]
12
IN WITNESS WHEREOF, the Company has caused this Amended and Restated Secured
Convertible Term Note to be signed in its name effective as of this 14th day
of July, 2005.
ON THE GO HEALTHCARE, INC.
By: /s/Xxxxxx Xxxx
--------------------------
Name: Xxxxxx Xxxx
Title:CEO
WITNESS: /s/Xxxxxx Xxxxx
--------------------
13
Exhibit A
NOTICE OF CONVERSION
(To be executed by the Holder in order to convert all or part of
the Secured Convertible Term Note into Common Stock)
On The Go Healthcare, Inc.
00 Xxxxxxxx Xxx Xxxx #0
Xxxxxxx, Xxxxxxx, X0X 0X0
The undersigned hereby converts $_________ of the principal due on [specify
applicable Repayment Date] under the Secured Convertible Term Note dated as
of _________, 200__ (the "Note") issued by On The Go Healthcare, Inc.(the
"Company") by delivery of shares of Common Stock of the Company ("Shares")
on and subject to the conditions set forth in the Note.
1. Date of Conversion _______________________
2. Shares To Be Delivered: _______________________
[HOLDER]
By:_______________________________
Name:_____________________________
Title:______________________________
14
