EXHIBIT 10.2
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The securities represented by this Debenture have not been registered under the
Securities Act of 1933, as amended ("Act"), or applicable state securities laws
("State Acts") and shall not be sold, hypothecated, donated or otherwise
transferred unless the Company shall have received an opinion of legal counsel
for the Company, or such other evidence as may be satisfactory to legal counsel
for the Company, to the effect that any such transfer shall not require
registration under the Act and the State Acts.
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LA-MAN CORPORATION
8.75% CONVERTIBLE DEBENTURE
$1,750,000 NO. 1
DATE OF ISSUE: MARCH 2, 1998
LA-MAN CORPORATION, a Nevada corporation (the "Company" or "Borrower"), for
value received, promises to pay to:
Compass Bank, Custodian FBO
RENAISSANCE CAPITAL GROWTH & INCOME FUND III, INC.
or to its order, (together with any assignee, jointly or severally, the "Holder"
or "Lender") on or before March 2, 2005 (the "Due Date") (unless this Debenture
shall have been sooner called for redemption or presented for conversion as
herein provided), the sum of ONE MILLION SEVEN HUNDRED FIFTY THOUSAND DOLLARS
($1,750,000) (the "Principal Amount") and to pay interest on the unpaid
Principal Amount at the rate of 8.75% per annum. All payments of both principal
and interest shall be made at the address of the Holder hereof as it appears in
the books and records of the Borrower, or at such other place as may be
designated by the Holder hereof.
1. INTEREST: Interest on the Principal Amount outstanding from time to
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time shall be payable in monthly installments commencing April 1, 1998, and
subsequent payments shall be made on the first day of each month thereafter
until the Principal Amount and all accrued and unpaid interest shall have been
paid in full. Overdue principal and interest on the Debenture shall bear
interest at the maximum rate permitted by applicable law.
2. MATURITY: If not sooner paid, redeemed or converted, this Debenture
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shall mature on March 2, 2005 at which time the remaining unpaid Principal
Amount, and all accrued and unpaid interest and any other charges then due under
the Loan Agreement, shall be due and payable in full. This Debenture may be
prepaid without premium or penalty and shall be prepaid pro rata with any
prepayments of Indebtedness (other than Senior Obligations) which is pari passu
with or subordinated to this Debenture.
3. MANDATORY PRINCIPAL INSTALLMENTS: If this Debenture is not sooner
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redeemed or converted as provided hereunder, Borrower shall pay to Holder,
commencing on March 2, 2001 and continuing on the first day of each successive
month thereafter prior to maturity, mandatory principal redemption installments,
each of such installments to be in the amount of Ten Dollars ($10) per Thousand
Dollars ($1,000) of the then remaining Principal Amount, and further, at
maturity, Borrower shall pay to Holder a Final installment of the remaining
unpaid Principal Amount, and all accrued and unpaid interest and any other
charges then due under the Loan Agreement.
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4. OPTIONAL REDEMPTION BY HOLDER: (a) If at any time after the date
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hereof (i) the Company's Common Stock, $.001 par value ("Common Stock"), is not
listed on the NASDAQ National Market System ("National Market"), the New York
Stock Exchange ("NYSE"), the American Stock Exchange ("AMEX"), or quoted on the
NASDAQ Small Cap System ("Small Cap System"), (ii) there is a change of control
of the Company's voting stock, without the written consent of the Holder, (iii)
there is a change of at least two-thirds of the members of the Company's Board
of Directors in any three (3)-year period, other than individual resignations in
the normal course, without the written consent of the Holder, (iv) all or
substantially all of the assets or capital stock of the Company or its
subsidiaries are sold, without the consent of the Holder, or (v) the Company or
its subsidiaries are merged or consolidated with or into unaffiliated entities,
without the written consent of Holder, the Holder shall have the right to
require this Debenture to be redeemed by the Company at the sum equal to the
Principal Amount, together with an amount equal to an 15% annual yield on the
Principal Amount through the date of redemption (the "Redemption Date").
(b) If J. Xxxxxxx Xxxxxxxx does not continue to serve the Company in the
capacity of President and Chief Executive Officer, then the Holder shall have
the right to require this Debenture to be redeemed by the Company at the sum
equal to the Principal Amount, together with an amount equal to 15% annual yield
on the Principal Amount through the Redemption Date.
(c) The Holder may exercise its right to require that the Company redeem
this Debenture pursuant to Section 4(a) or Section 4(b) prior to maturity by
giving notice thereof to the Company, which notice shall specify the terms of
redemption (including the place at which the Holder may obtain payment), the
total redemption payment and the Redemption Date, which date shall not be less
than 30 days nor more than 60 days after the date of the notice.
5. OPTIONAL REDEMPTION BY COMPANY: (a) On any interest payment date, and
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after prior irrevocable notice as provided for below, this Debenture is
redeemable, in whole but not in part, at 101% of par, together with accrued and
unpaid interest through the Redemption Date, by the Company, if all of the
following conditions are satisfied: (i) the closing bid price for the Common
Stock averages at least $8.64 per share for the 20 consecutive trading days
prior to the irrevocable notice and the Common Stock is listed or quoted on the
National Market, the Small Cap System, AMEX or NYSE; (ii) the average daily
trading volume for the 45 consecutive trading days prior to the irrevocable
notice shall be no less than 30,000 shares; and (iii) the Company shall have
filed a registration statement covering the shares of Common Stock issuable upon
conversion of this Debenture, which shall have become effective. The foregoing
bid price test shall be duly adjusted for stock splits, stock dividends,
subdivisions, combinations, mergers, consolidations, and other
recapitalizations. The Company's right of redemption is subject to the Holder's
prior right of conversion of the Debenture.
(b) In the event that the conditions for an adjustment in the Conversion
Price pursuant to Section 6(b) and (c) hereof are satisfied, this Debenture is
redeemable by the Company, in whole but not in part, at the sum equal to the
Principal Amount, together with an amount equal to a 15% annual yield on the
Principal Amount through the Redemption Date.
(c) The Company may exercise its right to redeem this Debenture pursuant
to Section 5(a) or (b) prior to maturity by giving notice thereof to the Holder
of this Debenture as such name appears on the books of the Borrower, which
notice shall specify the terms of redemption (including the place at which the
Holder may obtain payment), the total redemption payment and the Redemption
Date, which date shall not be less than 30 days nor more than 60 days after the
date of the notice.
6. CONVERSION RIGHT: (a) The Holder of this Debenture shall have the
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right, at Holder's option, at any time, to convert all, or, in multiples of
$100,000, any part of this Debenture into such number of fully paid and
nonassessable shares of Common Stock as provided herein. The Holder of this
Debenture may exercise the conversion right by giving written notice (the
"Conversion Notice") to Borrower of the exercise of such right and stating the
name or names in which the stock certificate or stock certificates for the
shares of Common Stock are to be issued and the address to which
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such certificates shall be delivered. The Conversion Notice shall be accompanied
by the Debenture. The number of shares of Common Stock that shall be issuable
upon conversion of the Debenture shall equal the face amount of the Debenture
divided by the Conversion Price (as defined below) and in effect on the date the
Conversion Notice is given; provided, however, that in the event that this
Debenture shall have been partially redeemed, shares of Common Stock shall be
issued pro rata, rounded to the nearest whole share. Conversion shall be deemed
to have been effected on the date the Conversion Notice is received (the
"Conversion Date"). In the case of any Debenture called for redemption, the
conversion rights will expire at the close of business on the Redemption Date.
Within 20 business days after receipt of the Conversion Notice, Borrower shall
issue and deliver by hand against a signed receipt therefor or by United States
registered mail, return receipt requested, to the address designated in the
Conversion Notice, a stock certificate or stock certificates of Borrower
representing the number of shares of Common Stock to which Holder is entitled
and a check or cash in payment of all interest accrued and unpaid on the
Debenture up to and including the Conversion Date. The conversion rights will be
governed by the following provisions:
(b) Conversion Price. On the issue date hereof and until such time as an
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adjustment shall occur, the Conversion Price shall be $4.75 per share; provided,
however, that the Conversion Price shall be subject to adjustment at the times
and in accordance with the provisions set forth below. Any such adjustment
shall be subject to the Company's optional right to redeem this Debenture as set
forth in Section 5(b) hereof, upon notice given in the manner set forth in
Section 5(c) hereof.
(i) Adjustment for Issuance of Shares at Less Than the
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Conversion Price. If and whenever any Additional Common Stock shall be issued by
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Borrower (the "Stock Issue Date") for a consideration per share less than the
Conversion Price, then in each such case the initial Conversion Price shall be
reduced to a new Conversion Price in an amount equal to the price per share for
the Additional Common Stock then issued, if issued in connection with a sale of
shares, or the value of the Additional Common Stock then issued, as determined
in accordance with generally accepted accounting principles, if issued other
than for cash, and the number of shares issuable to Holder upon conversion shall
be proportionately increased; and, in the case of Additional Common Stock issued
without consideration, the initial Conversion Price shall be reduced in amount
and the number of shares issued upon conversion shall be increased in an amount
so as to maintain for the Holder the right to convert the Debenture into shares
equal in amount to the same percentage interest in the Common Stock of the
Company as existed for the Holder immediately preceding the Stock Issue Date.
(ii) Sale of Shares. In case of the issuance of Additional
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Common Stock for a consideration part or all of which shall be cash, the amount
of the cash consideration therefor shall be deemed to be the gross amount of the
cash paid to Borrower for such shares, before deducting any underwriting
compensation or discount in the sale, underwriting or purchase thereof by
underwriters or dealers or others performing similar services or for any
expenses incurred in connection therewith. In case of the issuance of any shares
of Additional Common Stock for a consideration part or all of which shall be
other than cash, the amount of the consideration therefor, other than cash,
shall be deemed to be the then fair market value of the property received.
(iii) Stock Dividends. Shares of Common Stock issued as a
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dividend or other distribution on any class of capital stock of Borrower shall
be deemed to have been issued without consideration.
(iv) Stock Splits, Subdivisions or Combinations. In the event of
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a stock split or subdivision of shares of Common Stock into a greater number of
shares, the Conversion Price shall be proportionately decreased, and in the
event of a combination of shares of Common Stock into a smaller number of
shares, the Conversion Price shall be proportionately increased, such increase
or decrease, as the case may be, becoming effective at the record date.
(v) Exceptions. The term "Additional Common Stock" herein shall
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mean all shares of Common Stock hereafter issued by Borrower (including Common
Stock held in the treasury of Borrower), except (A) Common Stock issued upon the
conversion of any of the Debentures; (B) Common Stock issued upon exercise of
any outstanding
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warrants, options or convertible debt instruments; (C) Common Stock issued upon
exercise of outstanding employee stock options; (D) up to 200,000 shares of
Common Stock issuable upon exercise of warrants issued to the Holders; and (E)
up to 200,000 shares of Common Stock to be issued upon exercise of options or
warrants to be granted to its investment advisors for consulting services or to
employees under its employee stock option and stock compensation plans.
(c) Adjustment for Mergers, Sales and Consolidations. In the event of any
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consolidation or merger of the Company with or into, or the sale of all or
substantially all of the properties and assets of the Company, to any person,
and in connection therewith, consideration is payable to holders of Common Stock
in cash, securities or other property, then as a condition of such
consolidation, merger or sale, lawful provision shall be made, and duly executed
documents evidencing the same shall be delivered to the Holder, so that the
Holder shall have the right at any time prior to the maturity of this Debenture
to purchase, at a total price equal to the Conversion Price immediately prior to
such event, the kind and amount of cash, securities or other property receivable
in connection with such consolidation, merger or sale, by a holder of the same
number of shares of Common Stock as were exercisable by the Holder immediately
prior to such consolidation, merger or sale. In any such case, appropriate
provisions shall be made with respect to the rights and interest of the Holder
so that the provisions hereof shall thereafter be applicable with respect to any
cash, securities or property deliverable upon exercise hereof. Notwithstanding
the foregoing, (i) if the Company merges or consolidates with, or sells all or
substantially all of its property and assets to, any other person, and
consideration is payable to holders of Common Stock in exchange for their Common
Stock in connection with such merger, consolidation or sale which consists
solely of cash, or (ii) in the event of the dissolution, liquidation or winding
up of the Company, then the Holder shall be entitled to receive distributions on
the date of such event on an equal basis with holders of Common Stock as if this
Debenture had been converted immediately prior to such event, less the
Conversion Price. Upon receipt of such payment, if any, the rights of the Holder
shall terminate and cease and this Debenture shall expire. In case of any such
merger, consolidation or sale of assets, the surviving or acquiring person and,
in the event of any dissolution, liquidation or winding up of the Company, the
Company shall promptly, after receipt of this surrendered Debenture, make
payment by delivering a check in such amount as is appropriate (or, in the case
of consideration other than cash, such other consideration as is appropriate) to
such person as it may be directed in writing by the Holder surrendering this
Debenture.
(d) Distributions. In the event of distribution to all Common Stock
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holders of any securities, cash or properties or assets or other rights to
purchase securities or assets, then, after such event, this debenture will also
be convertible into the kind and amount of securities, cash and other property
which the Holder would have been entitled to receive if the Holder owned the
Common Stock issuable upon conversion of the Debenture immediately prior to the
occurrence of such event.
(e) Capital Reorganization and Reclassification. In case of any capital
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reorganization or reclassification of the Common Stock of Borrower (other than a
change in par value or as a result of a stock dividend, subdivision, split up or
combination of shares), this Debenture shall be convertible into the kind and
number of shares of stock or other securities or property of Borrower to which
the holder of the Debenture would have been entitled to receive if the holder
owned the Common Stock issuable upon conversion of the Debenture immediately
prior to the occurrence of such event. The provisions of the immediately
foregoing sentence shall similarly apply to successive reorganizations,
reclassifications, consolidations, exchanges, leases, transfers or other
dispositions or other share exchanges.
(f) Notice. In the event Borrower shall propose to take any action which
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shall result in an adjustment in the Conversion Price, Borrower shall give
notice to the Holder of this Debenture, which notice shall specify the record
date, if any, with respect to such action and the date on which such action is
to take place. Such notice shall be given on or before the earlier of 10 days
before the record date or the date which such action shall be taken. Such
notice shall also set forth all facts (to the extent known) material to the
effect of such action on the Conversion Price and the number, kind or class of
shares or other securities or property which shall be deliverable or purchasable
upon the occurrence of such action or deliverable upon conversion of this
Debenture.
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(g) Certificate. Following completion of an event which results in an
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adjustment to the Conversion Price, Borrower shall furnish to the holder of this
Debenture a statement, signed by the Chief Executive Officer and the Secretary
of the Borrower, of the facts creating such adjustment and specifying the
resultant adjusted Conversion Price then in effect, which statement shall
constitute an amendment to this Debenture.
7. ONE-TIME ADJUSTMENT TO CONVERSION PRICE. Notwithstanding the
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provisions of Section 6 hereof, if the volume-weighted average closing bid price
of the Common Stock, as reported in The Wall Street Journal, for the 45
consecutive trading days (the "Trading Period") following Borrower's public
press release of its fourth quarter 1999 financial results (such volume-weighted
average closing bid price herein referred to as the "1999 Conversion Price
Adjustment") is a price less than the initial Conversion Price and if the
Company does not achieve June 30, 1999 fiscal year pre-tax income of $3,500,000
excluding extraordinary gains, then the Conversion Price shall be adjusted
downward to an amount equal to 100% of the 1999 Conversion Price Adjustment. If
an adjustment is required pursuant to this Section 7, then the Borrower shall
furnish to the holder of this Debenture a statement, within ten days of the
occurrence thereof, signed by the Chief Financial Officer and the Secretary of
Borrower, of the facts creating such adjustment and specifying the resultant
adjusted Conversion Price then in effect, which statement shall constitute an
amendment to the Debenture. The Holder shall not convert this Debenture or sell
any shares of Common Stock during the Trading Period. Such one-time adjustment
to the Conversion Price shall be subject to the Holder's optional right to
require the Company to redeem this Debenture at the sum equal to the Principal
Amount, together with an amount equal to an 15% annual yield on the Principal
Amount through the Redemption Date, upon notice given in the manner set forth in
Section 4(b) hereof, if the Company reports pre-tax income of less than
$3,500,000, excluding extraordinary gains, for the June 30, 1999 fiscal year.
8. RESERVATION OF SHARES: Borrower warrants and agrees that it shall at
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all times reserve and keep available, free from preemptive rights, sufficient
authorized and unissued shares of Common Stock or treasury shares of Common
Stock necessary to effect conversion of this Debenture.
9. REGISTRATION RIGHTS: The shares of Common Stock issued upon conversion
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of this Debenture shall be restricted from transfer by the holder, unless the
shares are duly registered for sale pursuant to the Securities Act of 1933, as
amended, or the transfer is exempt from registration. The Holder has certain
rights with respect to the registration of shares of Common Stock issued upon
the conversion of this Debenture pursuant to the terms of the Loan Agreement.
Borrower agrees that a copy of the executed Loan Agreement and all amendments
shall be available to the Holder at the offices of the Company.
10. TAXES: The Company shall pay any documentary or other transactional
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taxes attributable to the issuance or delivery of this Debenture or the shares
of Common Stock issued upon conversion by the Holder (excluding any federal,
state or local income taxes and any franchise taxes or taxes imposed upon the
Holder by the jurisdiction, or any political subdivision thereof, under which
such Holder is organized or is qualified to do business.)
11. DEFAULT:
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(a) Event of Default: An "Event of Default" shall exist if an "Event of
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Default" (as defined in the Loan Agreement) shall occur and be continuing.
(b) Remedies Upon Event of Default: If an Event of Default shall have
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occurred and be continuing, then the Holder or Agent may exercise any one or
more of the rights and remedies provided in the Loan Documents, as the Holder or
Agent, in its sole discretion, may deem necessary or appropriate.
(c) Remedies Nonexclusive: Each right, power or remedy of the holder
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hereof upon the occurrence of any Event of Default as provided for in this
Debenture or now or hereafter existing at law or in equity or by statute shall
be cumulative and concurrent and shall be in addition to every other right,
power or remedy provided for in this Debenture
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or now or hereafter existing at law or in equity or by statute, and the exercise
or beginning of the exercise by the holder or transferee hereof of any one or
more of such rights, powers or remedies shall not preclude the simultaneous or
later exercise by the holder of any or all such other rights, powers or
remedies.
(d) Expenses: Upon the occurrence of a Default or an Event of Default,
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which occurrence is not cured within the notice provisions, if any provided
therefore, Borrower agrees to pay and shall pay all costs and expenses
(including attorneys' fees and expenses) incurred by the Holder or Agent in
connection with the preservation and enforcement of Holder's rights under the
Loan Agreement, the Debenture, or any other Loan Document.
12. FAILURE TO ACT AND WAIVER: No failure or delay by the holder hereof to
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require the performance of any term or terms of this Debenture or not to
exercise any right or any remedy shall constitute a waiver of any such term or
of any right or of any default, nor shall such delay or failure preclude the
holder hereof from exercising any such right, power or remedy at any later time
or times. By accepting payment after the due date of any amount payable under
this Debenture, the holder hereof shall not be deemed to waive the right either
to require payment when due of all other amounts payable, or to later declare a
default for failure to effect such payment of any such other amount. The
failure of the holder of this Debenture to give notice of any failure or breach
of the Borrower under this Debenture shall not constitute a waiver of any right
or remedy in respect of such continuing failure or breach or any subsequent
failure or breach.
13. CONSENT TO JURISDICTION: The Company hereby agrees and consents that
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any action, suit or proceeding arising out of this Debenture may be brought in
any appropriate court in the State of Texas, including the United States
District Court for the Northern District of Texas, or in any other court having
jurisdiction over the subject matter, all at the sole election of the Holder
hereof, and by the issuance and execution of this Debenture the Borrower
irrevocably consents to the jurisdiction of each such court. The Company hereby
irrevocably appoints CT Corporation System, Dallas, Texas, as agent for the
Borrower to accept service of process for and on behalf of the Borrower in any
action, suit or proceeding arising out of this Debenture. Except for default in
payment of interest or principal when and as they become due, and except as
otherwise specifically set forth herein or otherwise agreed to in writing by the
parties, any action dispute, claim or controversy (all such herein called
"Dispute") between or among the parties as to the facts or the interpretation of
the Debenture shall be resolved by arbitration as set forth in the Loan
Agreement.
14. HOLDER'S RIGHT TO REQUEST MULTIPLE DEBENTURES: The Holder shall, upon
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written request and presentation of the Debenture, have the right, at any
interest payment date, to request division of this Debenture into two or more
instruments, each of such to be in such amounts as shall be requested; provided
however that no Debenture shall be issued in denominations of face amount less
than $100,000.
15. TRANSFER: Subject to Section 12.08 of the Loan Agreement, this
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Debenture may be transferred on the books of the Borrower by the registered
Holder hereof, or by Holder's attorney duly authorized in writing, in multiples
of $100,000 only upon (i) delivery to the Borrower of a duly executed assignment
of the Debenture, or part thereof, to the proposed new Holder, along with a
current notation of the amount of payments received and net Principal Amount yet
unfunded, and presentment of such Debenture to the Borrower for issue of a
replacement Debenture, or Debentures, in the name of the new Holder, (ii) the
designation by the new Holder of the Lender's agent for notice, such agent to be
the sole party to whom Borrower shall be required to provide notice when notice
to Lender is required hereunder and who shall be the sole party authorized to
represent Lender in regard to modification or waivers under the Debenture, the
Loan Agreement, or other Loan Documents; and any action, consent or waiver,
(other than a compromise of principal and interest), when given or taken by
Lender's agent for notice, shall be deemed to be the action of the holders of a
majority in amount of the Principal Amount of the Debenture, as such holders are
recorded on the books of the Borrower, and (iii) in compliance with the legend
to read as follows:
"The Securities represented by this Debenture have not been registered
under the Securities Act of 1933, as amended ("Act"), or applicable state
securities laws ("State Acts") and shall not be sold,
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hypothecated, donated or otherwise transferred unless the Company shall
have received an opinion of Legal Counsel for the Company, or such other
evidence as may be satisfactory to Legal Counsel for the Company, to the
effect that any such transfer shall not require registration under the Act
and the State Acts."
The Company shall be entitled to treat any holder of record of the
Debenture as the Holder in fact thereof and of the Debenture and shall not be
bound to recognize any equitable or other claim to or interest in this Debenture
in the name of any other person, whether or not it shall have express or other
notice thereof, except as otherwise provided by applicable law.
16. NOTICES: All notices and communications under this Debenture shall be
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in writing and shall be either delivered in person or by overnight service such
as FedEx and accompanied by a signed receipt therefor; or mailed first-class
United States certified mail, return receipt requested, postage prepaid, and
addressed as follows: (i) if to the Borrower at its address for notice as stated
in the Loan Agreement; and (ii) if to the Holder of this Debenture, to the
address (a) of such Holder as it appears on the books of the Borrower or (b) in
the case of a partial assignment to one or more Holders, to the Lender's agent
for notice, as the case may be. Any notice of communication shall be deemed
given and received as of the date of such delivery if delivered; or if mailed,
then three days after the date of mailing.
17. MAXIMUM INTEREST RATE: (a) Regardless of any provision contained in
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this Debenture, Lender shall never be entitled to receive, collect or apply as
interest on the Debenture any amount in excess of interest calculated at the
Maximum Rate, and, in the event that Lender ever receives, collects or applies
as interest any such excess, the amount which would be excessive interest shall
be deemed to be a partial prepayment of principal and treated hereunder as such;
and, if the principal amount of the Debenture is paid in full, any remaining
excess shall forthwith be paid to Borrower. In determining whether or not the
interest paid or payable under any specific contingency exceeds interest
calculated at the Maximum Rate, Borrower and Lender shall, to the maximum extent
permitted under applicable law, (i) characterize any non principal payment as an
expense, fee or premium rather than as interest, (ii) exclude voluntary
prepayments and the effects thereof, and (iii) amortize, pro rate, allocate and
spread, in equal parts, the total amount of interest throughout the entire
contemplated term of the Debenture; provided that, if the Debenture is paid and
performed in full prior to the end of the full contemplated term thereof, and if
the interest received for the actual period of existence thereof exceeds
interest calculated at the Maximum Rate, Lender shall refund to Borrower the
amount of such excess or credit the amount of such excess against the principal
amount of the Debenture and, in such event, Lender shall not be subject to any
penalties provided by any laws for contracting for, charging, taking, reserving
or receiving interest in excess of interest calculated at the Maximum Rate.
(b) "Maximum Rate" shall mean, on any day, the highest nonusurious rate of
interest (if any) permitted by applicable law on such day that at any time, or
from time to time, may be contracted for, taken, reserved, charged or received
on the Indebtedness evidenced by the Debenture under the laws which are
presently in effect of the United States of America or by the laws of any other
jurisdiction which are or may be applicable to the holders of the Debenture and
such Indebtedness or, to the extent permitted by law, under such applicable laws
of the United States of America or by the laws of any other jurisdiction which
are or may be applicable to the holder of the Debenture and which may hereafter
be in effect and which allow a higher maximum nonusurious interest rate than
applicable laws now allow.
18. RIGHTS UNDER LOAN AGREEMENT. This Debenture is issued pursuant to the
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Convertible Loan Agreement dated of even date herewith among the Company,
Renaissance III and Renaissance PLC, as Lenders, and Agent, and the holders
hereof are entitled to all the rights and benefits. Both Borrower and Lenders
have participated in the negotiation and preparation of the Loan Agreement and
of this Debenture. Borrower agrees that a copy of the Loan Agreement with all
amendments, additions and substitutions therefor shall be available to the
Holders at the offices of Borrower.
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19. DEFINED TERMS: Capitalized terms used but not defined herein shall
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have the meaning given them in the Loan Agreement.
20. GOVERNING LAW: This Debenture shall be governed by and construed and
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enforced in accordance with the substantive laws of the State of Texas, without
regard to the conflicts of laws provisions thereof, and the applicable laws of
the United States.
IN WITNESS WHEREOF, the Company has caused this Debenture to be duly
issued, executed and delivered on the date and year above stated.
LA-MAN CORPORATION
By: /s/ J. Xxxxxxx Xxxxxxxx
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J. Xxxxxxx Xxxxxxxx
President and Chief Executive Officer
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