Contract
Exhibit
10.2
ANNEX
I
TO
(PROTOTYPE
FOR EACH ISSUANCE)
FORM
OF NOTE
THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD OR OFFERED
FOR
SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
OR
AN OPINION OF COUNSEL OR OTHER EVIDENCE ACCEPTABLE TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED.
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No.
07-01-1
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US$__________
2
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RIM
SEMICONDUCTOR COMPANY
SENIOR
SECURED PROMISSORY NOTE DUE JULY ____, 20073
THIS
NOTE
is one of a duly authorized issue of up to $324,000 of RIM SEMICONDUCTOR
COMPANY, a corporation organized and existing under the laws of the State
of
Utah (the "Company"), designated as its Senior Secured Promissory Note Series
07-01.
FOR
VALUE
RECEIVED, the Company promises to pay to _____________________
,
the
registered holder hereof (the "Holder"), the principal sum of
________________Thousand ____________ and 00/100 Dollars (US
$___________)4
on the
Maturity Date (as defined below).
TIME
IS OF THE ESSENCE WITH RESPECT TO THE COMPANY’S FULFILLMENT OF ALL OF ITS
PAYMENT OBLIGATIONS HEREUNDER.
The
Holder shall not be required to give the Company any notice of default of
payment if any such payment is not timely paid or otherwise satisfied. All
provisions of this Note which apply in the event of the Company’s not timely
fulfilling any of its payment obligations hereunder shall apply whether or
not
such notice of default is given. The Holder’s giving of any notice to the
Company shall not be deemed a waiver,
___________
1Insert
unique Note number for each issuance.
2Insert
amount equal to 108% of Holder’s Purchase Price.
3Insert
date which is 120 days after the Closing Date
4See
fn 2.
1
modification
or amendment of this provision with respect to the failure referred to in
that
notice or to any other failure by the Company timely to make any other payment
due hereunder.
This
Note
or its predecessor was originally issued on ________,
20075(the
“Issue Date”).
This
Note
is being issued pursuant to the terms of the Bridge Loan Agreement, dated
as of
March 26, 2007 (the “Bridge Loan Agreement”), to which the Company and the
Holder (or the Holder’s predecessor in interest) are parties. Capitalized terms
not otherwise defined herein shall have the meanings ascribed to them in
the
Bridge Loan Agreement.
This
Note
is subject to the following additional provisions:
1.
The
Note will initially be issued in denominations determined by the Company,
but
are exchangeable for an equal aggregate principal amount of Note of different
denominations, as requested by the Holder surrendering the same. No service
charge will be made for such registration or transfer or exchange.
2.
No interest will accrue on this Note until the Maturity Date. If any portion
of
this Note is outstanding on the Maturity Date, interest at the rate of
twenty-four percent (24%) per annum or the highest rate allowed by law,
whichever is lower, shall accrue on the outstanding principal of this Note
from
the Maturity Date to and including the date of payment by the Company. Such
interest shall accrue on a daily basis and shall be payable in cash. The
Holder
may demand payment of all or any part of this Note, together with accrued
interest, if any, and any other amounts due hereunder, as of the Maturity
Date
or any date thereafter.
3.
The Company shall be entitled to withhold from all payments of principal
of,
and, if applicable, 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, and Holder shall execute and
deliver all required documentation in connection therewith.
4.
This Note has been issued subject to investment representations of the original
purchaser hereof and may be transferred or exchanged only in compliance with
the
Securities Act of 1933, as amended (the "Act"), and other applicable state
and
foreign securities laws and the terms of the Bridge Loan Agreement. In the
event
of any proposed transfer of this Note, the Company may require, prior to
issuance of a new Note in the name of such other person, that it receive
reasonable transfer documentation that is sufficient to evidence that such
proposed transfer complies with the Act and other applicable state and foreign
securities laws and the terms of the Bridge Loan 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.
______________
5Insert
the Closing Date, as the case may be.
2
5.
(a)
The term “Maturity Date” means the earliest of (i) July ____,
20076
(the
“Stated Maturity Date”), (ii) the New Transaction Threshold Date (as defined
below), or (iii) the Default Maturity Date (as defined below).
(b)
The
term “New Transaction Threshold Date” means the date on which the Company
consummates the first New Transaction in which the Company receives, on a
cumulative basis after taking into account the gross proceeds from all prior
New
Transactions, if any, after the Issue Date, gross proceeds of at least Two
Million Dollars ($2,000,000). All such gross proceeds are determined before
deduction of any fees or other expenses or disbursements of any kind in
connection with the relevant New Transaction.
6.
(a)
Any payment made on account of this Note shall be applied in the following
order
of priority: (i) first, to any amounts due hereunder other than principal
and
accrued interest, (ii)
then, to accrued interest, if any, through and including the date of payment,
and (iii) then, to principal of this Note.
(b)
Subject to the provisions of Section 6(a) hereof, the outstanding principal
of
this Note may be prepaid in whole or in part at the option of the Company
at any
time prior to the Maturity Date.
7.
All payments contemplated hereby are to be made “in cash” and shall be made in
immediately available good funds of United States of America currency by
wire
transfer to an account designated in writing by the Holder to the Company
(which
account may be changed by notice similarly given). For purposes of this Note,
the phrase “date of payment” means the date good funds are received in the
account designated by the notice which is then currently effective.
8.
(a) Subject to the terms of the Bridge Loan Agreement, no provision of this
Note
shall alter or impair the obligation of the Company, which is absolute and
unconditional, to pay the principal of, and, if applicable, interest on,
this
Note at the time, place, and rate, and in the coin or currency, as herein
prescribed. This Note is a direct obligation of the Company.
(b)
Payment of this Note is secured pursuant to the terms of the Security Interest
Agreement, dated the Issue Date (the “Security Interest Agreement”), executed by
the Company, as debtor, in favor of the Lender, as secured party. The terms
of
the Security Interest Agreement are incorporated herein by reference.
9.
No recourse shall be had for the payment of the principal of, or, if applicable,
the interest on, this Note, or for any claim based hereon, or otherwise in
respect hereof, against any incorporator, shareholder, officer or director,
as
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.
__________
6See
fn 3.
3
10.
The Holder of the Note, by acceptance hereof, agrees that this Note is being
acquired for investment and that such Holder will not offer, sell or otherwise
dispose of this Note except under circumstances which will not result in
a
violation of the Act or any applicable state Blue Sky or foreign laws or
similar
laws relating to the sale of securities.
11.
Any notice required or permitted hereunder shall be given in manner provided
in
the Section headed "NOTICES" in the Bridge Loan Agreement, the terms of which
are incorporated herein by reference.
12.
(a) This Note shall be governed by and interpreted in accordance with the
laws
of the State of Delaware for contracts to be wholly performed in such state
and
without giving effect to the principles thereof regarding the conflict of
laws.
Each of the parties consents to the exclusive jurisdiction of the federal
courts
whose districts encompass any part of the City of Wilmington or the state
courts
of the State of Delaware sitting in the City of Wilmington in connection
with
any dispute arising under this Note and hereby waives, to the maximum extent
permitted by law, any objection, including any objection based on
forum non conveniens,
to the bringing of any such proceeding in such jurisdictions. To the extent
determined by such court, the Company shall reimburse the Holder for any
reasonable legal fees and disbursements incurred by the Holder in enforcement
of
or protection of any of its rights under this Note.
(b)
JURY
TRIAL WAIVER. The
Company and the Holder hereby waive a trial by jury in any action, proceeding
or
counterclaim brought by either of the Parties hereto against the other in
respect of any matter arising out of or in connection with this Note.
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13.
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(a)
The following shall constitute an "Event of Default":
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i.
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The
Company shall default in the timely payment of principal on this
Note or
any other amount due hereunder (without the requirement of any
further
notice with respect thereto from the Holder); or
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ii.
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Any
of the representations or warranties made by the Company herein,
in the
Bridge Loan Agreement or any of the other Transaction Agreements
shall be
false or misleading in any material respect at the time made; or
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iii.
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The
Company shall fail to perform or observe, in any material respect,
any
other covenant, term, provision, condition, agreement or obligation
of any
Note in this series and such failure shall continue uncured for
a period
of thirty (30) days after the Company’s receipt of written notice thereof
from the Holder; or
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iv.
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The
Company shall fail to perform or observe, in any material respect,
any
covenant, term, provision, condition, agreement or obligation of
the
Company under any of the Transaction Agreements and such failure
shall
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4
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continue
uncured for a period of thirty (30) days after the Company’s receipt of
written notice thereof from the Holder; or
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v.
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The
Company shall (1) admit in writing its inability to pay its debts
generally as they mature; (2) make an assignment for the benefit
of
creditors or commence proceedings for its dissolution; or (3) apply
for or
consent to the appointment of a trustee, liquidator or receiver
for its or
for a substantial part of its property or business; or
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vi.
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A
trustee, liquidator or receiver shall be appointed for the Company
or for
a substantial part of its property or business without its consent
and
shall not be discharged within sixty (60) days after such appointment;
or
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vii.
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Any
governmental agency or any court of competent jurisdiction at the
instance
of any governmental agency shall assume custody or control of the
whole or
any substantial portion of the properties or assets of the Company
and
shall not be dismissed within sixty (60) days thereafter; or
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viii.
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Any
money judgment, writ or warrant of attachment, or similar process
in
excess of Seven Hundred Fifty Thousand ($750,000) Dollars in the
aggregate
shall be entered or filed against the Company or any of its properties
or
other assets and shall remain unpaid, unvacated, unbonded or unstayed
for
a period of sixty (60) days or in any event later than five (5)
days prior
to the date of any proposed sale thereunder; or
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ix.
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Bankruptcy,
reorganization, insolvency or liquidation proceedings or other
proceedings
for relief under any bankruptcy law or any law for the relief of
debtors
shall be instituted by or against the Company and, if instituted
against
the Company, shall not be dismissed within sixty (60) days after
such
institution or the Company shall by any action or answer approve
of,
consent to, or acquiesce in any such proceedings or admit the material
allegations of, or default in answering a petition filed in any
such
proceeding.
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(b)
If an Event of Default shall have occurred and is continuing, then, or at
any
time thereafter, and in each and every such case, unless such Event of Default
shall have been cured or waived in writing by the Holder (which waiver shall
not
be deemed to be a waiver of any subsequent default) (the period during which
such Event of Default shall be continuing until such cure or waiver, the
“Default Period”),
(i)
at the option of the Holder and in the Holder's sole discretion, the Holder
may
consider this Note immediately due and payable (and the Maturity Date shall
be
accelerated accordingly; the “Default Maturity Date”), without presentment,
demand, protest or notice of any kinds, all of which are hereby expressly
waived, anything herein or in any note or other instruments contained to
the
contrary notwithstanding, and the Holder may immediately enforce any and
all of
the Holder's rights and
5
remedies provided herein or any other rights or remedies afforded by law, including, but not necessarily limited to, the equitable remedy of specific performance and injunctive relief; and
(ii)
the terms of Appendix I to this Note shall be effective.
[Balance
of page intentionally left blank]
6
14.
In
the event for any reason, any payment by or act of the Company or the Holder
shall result in payment of interest which would exceed the limit authorized
by
or be in violation of the law of the jurisdiction applicable to this Note,
then
ipso
facto
the
obligation of the Company to pay interest or perform such act or requirement
shall be reduced to the limit authorized under such law, so that in no event
shall the Company be obligated to pay any such interest, perform any such
act or
be bound by any requirement which would result in the payment of interest
in
excess of the limit so authorized. In the event any payment by or act of
the
Company shall result in the extraction of a rate of interest in excess of
a sum
which is lawfully collectible as interest, then such amount (to the extent
of
such excess not returned to the Company) shall, without further agreement
or
notice between or by the Company or the Holder, be deemed applied to the
payment
of principal, if any, hereunder immediately upon receipt of such excess funds
by
the Holder, with the same force and effect as though the Company had
specifically designated such sums to be so applied to principal and the Holder
had agreed to accept such sums as an interest-free prepayment of this Note.
If
any part of such excess remains after the principal has been paid in full,
whether by the provisions of the preceding sentences of this Section or
otherwise, such excess shall be deemed to be an interest-free loan from the
Company to the Holder, which loan shall be payable immediately upon demand
by
the Company. The provisions of this Section shall control every other provision
of this Note.
Dated:
_________________, 2007
RIM
SEMICONDUCTOR
COMPANY
By:_______________________________________
________________________________________
(Print
Name)
________________________________________
(Title)
7
APPENDIX
I
TO
RIM
SEMICONDUCTOR COMPANY
SENIOR
SECURED PROMISSORY NOTE SERIES 07-01
Capitalized
terms not otherwise defined herein shall have the meanings ascribed to them
in
the Bridge Loan Agreement or in the Note.
1.
A. (i)
For purposes of this Appendix, the following terms shall have the meanings
indicated below:
“Conversion
Price” means the amount equal to (x) the Closing Price for the five (5) Trading
Days ending on the Trading Day immediately before the Conversion Date,
multiplied by (y) seventy-five percent (75%); provided, however, that the
Conversion Price shall in no event be less than $0.01.
“Closing
Price” means the 4:00 P.M. closing bid price of the Common Stock on the
Principal Trading Market on the relevant Trading Day(s), as reported by the
Reporting Service for the relevant date(s).
“Reporting
Service” means Bloomberg LP or if that service is not then reporting the
relevant information regarding the Common Stock, a comparable reporting service
of national reputation selected by a Majority in Interest of the Holders
and
reasonably acceptable to the Company.
(d)
“Majority in Interest of the Holders” means, as of the relevant date, one or
more Holders whose respective outstanding principal amounts of the Notes
of this
Series held by each of them, as of such date, aggregate more than fifty percent
(50%) of the aggregate outstanding principal amounts of the outstanding Notes
of
this Series held by all Holders on that date.
(ii)
At any time during the Default Period and prior to the date this Note is
paid in
full in accordance with its terms, the Holder of this Note is entitled, at
its
option, subject to the following provisions of this Appendix I, to convert
the
principal and the accrued interest, if any, of this Note into shares of Common
Stock, $0.001 par value ("Common Stock"), of the Company at the Conversion
Price.
B.
Conversion shall be effectuated by faxing a Notice of Conversion (as defined
below) to the Company as provided in this paragraph. The Notice of Conversion
shall be executed by the Holder of this Note and shall evidence such Holder's
intention to convert this Note or a specified portion hereof in the form
annexed
hereto as Exhibit A. No fractional shares of Common Stock or scrip representing
fractions of shares will be issued on conversion, but the number of shares
issuable shall be rounded to the nearest whole share. The date on which notice
of conversion is given (the "Conversion Date") shall be deemed to be the
date on
which the Holder faxes or otherwise delivers the conversion notice ("Notice
of
Conversion") to the Company so that it is
Appendix
I
- Page 1
received
by the Company on or before such specified date, provided that, if such
conversion would convert the entire remaining principal of this Note, the
Holder
shall deliver to the Company the original Note being converted no later than
five (5) Trading Days thereafter. Delivery of the Notice of Conversion shall
be
accepted by the Company by hand, mail or courier delivery at the address
specified in said Exhibit A or at the facsimile number specified in said
Exhibit
A (each of such address or facsimile number may be changed by notice given
to
the Holder in the manner provided in the Bridge Loan Agreement). Certificates
representing Common Stock upon conversion (“Conversion Certificates”) will be
delivered to the Holder at the address specified in the Notice of Conversion
(which may be the Holder’s address for notices as contemplated by the Bridge
Loan Agreement or a different address), via express courier, by electronic
transfer or otherwise, within three (3) Trading Days (such third Trading
Day,
the “Delivery Date”) after the relevant Conversion Date. The Holder shall be
deemed to be the holder of the shares issuable to it in accordance with the
provisions of this paragraph (B) on the Conversion Date.
C.
Notwithstanding any other provision hereof or of any of the other Transaction
Agreements, in no event (except (i) as specifically provided herein as an
exception to this provision, or (ii) while there is outstanding a tender
offer
for any or all of the shares of the Company’s Common Stock) shall the Holder be
entitled to convert any portion of this Note, or shall the Company have the
obligation to convert such Note to the extent that, after such conversion
or
issuance of stock in payment of interest, the sum of (1) the number of shares
of
Common Stock beneficially owned by the Holder and its affiliates (other than
shares of Common Stock which may be deemed beneficially owned through the
ownership of the unconverted portion of the Note or other convertible securities
or of the unexercised portion of warrants or other rights to purchase Common
Stock), and (2) the number of shares of Common Stock issuable upon the
conversion of the Notes with respect to which the determination of this proviso
is being made, would result in beneficial ownership by the Holder and its
affiliates of more than 4.99% of the outstanding shares of Common Stock (after
taking into account the shares to be issued to the Holder upon such conversion).
For purposes of the proviso to the immediately preceding sentence, beneficial
ownership shall be determined in accordance with Section 13(d) of the Securities
Exchange Act of 1934, as amended, except as otherwise provided in clause
(1) of
such sentence. Nothing herein shall preclude the Holder from disposing of
a
sufficient number of other shares of Common Stock beneficially owned by the
Holder so as to thereafter permit the continued conversion of this Note.
D.
(i) No
later than the thirtieth day of the Default Period (such day the “Required
Filing Date”), the Company shall prepare and file with the SEC a Registration
Statement registering for resale by the Holder all Conversion Shares
(“Registrable Securities”). Notwithstanding the requirement to register all
Registrable Securities, the Company’s obligation to register the Registrable
Securities shall initially be satisfied by the registration of the Initial
Number of Shares to Be Registered (as defined below). The “Initial Number of
Shares to Be Registered” is a number of shares of Common Stock which is at least
equal to the sum of two hundred percent (200%) of the number of shares into
which the Note and all interest thereon for one year from the commencement
of
the Default Period would be convertible at the time of filing of such
Registration Statement (assuming for such purposes that the Note had been
eligible to be converted, and had been converted, into Conversion Shares
in
accordance with its terms, whether or not such eligibility, accrual of interest
or conversion had in fact occurred as of such date) based on the Conversion
Price in effect on, or within three (3) Trading Days prior to, the date the
Registration Statement is filed (or subsequently amended). Unless otherwise
specifically agreed to in writing in advance by the Holder, the Registration
Statement shall not restrict or limit the prices at which the shares sold
by the
selling stockholders thereunder may be sold and shall also state that, in
accordance with Rule 416 and 457 under the Securities Act, it also covers
such
indeterminate number of additional shares of Common Stock as may become issuable
upon conversion of the Note to prevent dilution resulting from stock splits,
stock dividends or similar transactions.
Appendix
I
- Page 2
(ii)
The
Company will use its reasonable best efforts to cause such Registration
Statement to be declared effective on a date (the “Required Effective Date”)
which is no later than the earlier of (X) five (5) days after oral or written
notice by the SEC that it may be declared effective or (Y) the ninetieth
day
after the Closing Date.
(iii)
If
(X) the Company does not file the Registration Statement by the Required
Filing
Date and/or (Y) for any reason, the Registration Statement is not declared
effective by the Required Effective Date and/or (Z) the Company does not
maintain the effectiveness of such Registration Statement for at least two
years
or the earlier date on which the Note has been fully paid or converted and
all
Conversion Shares have been sold, the Company will pay the Holder in cash
an
amount equal to 1.85185% of the outstanding principal amount of the Note
of the
Holder for each 30 day period (prorated for partial periods) until such filing,
such effective date or such effectiveness is re-established, as the case
may be.
The outstanding principal amount of the Note shall be determined as of the
close
of business on the last day preceding the first day of each such 30-day period.
The parties acknowledge that the damages which may be incurred by the Holder
in
those events may be difficult to ascertain. The parties agree that the amounts
payable pursuant to the foregoing provisions of this Section 1(D) are liquidated
damages and represent a reasonable estimate on the part of the parties, as
of
the Issue Date, of the amount of such damages.
2.
(a)
The term “Lower Price Transaction” means a New Transaction offered or
consummated during the New Transaction Period (as defined below), where the
lowest New Transaction Price (as defined below) is, or by its terms or by
an
existing understanding of the Company and the New Investor, could subsequently
be adjusted or revised to be, lower than the then effective Conversion Price
of
the Note (such Conversion Price, in each case, subject to adjustment in the
same
manner as the initial Exercise Price of the Warrant is adjusted, other than
as a
result of the application of this Section 2 of Appendix I).
(b)
“New Transaction Price” means the Basic New Transaction Price (as defined below)
except that if the New Transaction Exercise Price is lower than the Basic
New
Transaction Price, it means the New Transaction Exercise Price.
(c)
“Basic New Transaction Price” means, as may be applicable, on a per share basis,
the lower of (1) the lowest fixed purchase price of any shares of the New
Common
Stock contemplated in the New Transaction, or (2) the lowest conversion price
or
put or call price which would be applicable under the terms of the New
Transaction; in each such case, whether such purchase or conversion price
or put
or call price is stated or otherwise specified or is determined on the closing
date of the New Transaction by the application of a formula set in the documents
Appendix
I
- Page 3
reflecting
the New Transaction or could result from adjustments or revisions contemplated
in the relevant agreements for the New Transaction and whenever such adjustment
or revision would be applicable (and if no minimum purchase price, conversion
price or put or call price, as the case may be, is set, it shall be assumed
that
such minimum purchase price or conversion price is $.01); and provided, further,
that, if the securities issued in the New Transaction are issued at a Face
Value
Discount (as defined below), the New Transaction Price shall be adjusted
to
reflect such discount.7
(d)
“New Transaction Exercise Price” means the lowest exercise price per share
applicable to the warrants, option or similar instrument (howsoever denominated;
collectively, “New Transaction Warrants”) included in such New Transaction,
whether such exercise price is stated or could result from adjustments or
revisions contemplated in the relevant agreements for the New Transaction
and
whenever such exercise price would be applicable (and, if no minimum exercise
price is set, it shall be assumed that such minimum exercise price is $.01).
(e)
“Face Value Discount” means consideration less than, as the case may be, (x) the
number of shares being issued multiplied by the stated purchase price, (y)
the
stated principal amount of a debenture, note or similar instrument or (z)
the
stated value of the shares of convertible stock.
(f)
The term “New Transaction Period” means the period commencing on the Issue Date
and continuing until the date on which this Note is fully paid and/or converted.
3.
The
Company covenants and agrees that, if there is a Lower Price Transaction
during
the New Transaction Period, then the Conversion Price on the unexercised
portion
of this Note shall be adjusted to equal the lowest New Transaction Price
applicable to the Lower Price Transaction.
______________
7By
way of illustration, if convertible preferred shares having a stated value
of $1
million and a fixed conversion price of $0.50 (resulting in 2,000,000 shares)
were sold for a purchase price of $800,000, the effective New Transaction
Price
would be $0.40 (the conversion price at which $800,000 would convert into
2,000,000 shares).
Appendix
I
- Page 4
EXHIBIT
A
RIM
SEMICONDUCTOR COMPANY
NOTICE
OF
CONVERSION
OF
SENIOR
SECURED PROMISSORY NOTE DUE JULY ____, 2007
SERIES
07-01
(To
be
Executed by the Registered Holder in Order to Convert the Note)
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TO:
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RIM
SEMICONDUCTOR COMPANY
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VIA
FAX: (000) 000-0000
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000
XX 000xx Xxx., Xxxxx 000
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Xxxxxxxx,
XX 00000
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Attn:
President
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FROM:
_________________________________________________________ (“Holder”)
DATE:
_______________________________________________ (the “Conversion Date”)
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RE:
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Conversion
of $_________________ principal amount (the “Converted Note”) of the
Senior Secured Promissory Note Due July ___, 2007 (the “Note”) of RIM
SEMICONDUCTOR COMPANY (the “Company”) into ________________________ shares
(the “Conversion Shares”) of Common Stock (defined below)
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The
captioned Holder hereby gives notice to the Company, pursuant to the Note
of RIM
SEMICONDUCTOR COMPANY that the Holder elects to convert the Converted Note
into
fully paid and non-assessable shares of Common Stock, $0.001 par value (the
“Common Stock”), of the Company as of the Conversion Date specified above. Said
conversion shall be based on the following Conversion Price
|
o
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$___,
representing the Conversion Price (as defined in the Note; as adjusted
to
reflect capital adjustments after the Issue Date)
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o
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$________________,
representing the Conversion Price (as adjusted pursuant to the
terms of
Appendix I to the Note)
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Exhibit
A
- Page 1
Based
on
this Conversion Price, the number of Conversion Shares indicated above should
be
issued in the following names(s):
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Name
and Record Address
|
Conversion
Shares
|
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_______________________________
|
______________
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_______________________________
|
______________
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_______________________________
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______________
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It
is the
intention of the Holder to comply with the provisions of Section 1(C) of
Appendix I to the Note regarding certain limits on the Holder's right to
convert
thereunder. The Holder believe this conversion complies with the provisions
of
said Section 1(C). Nonetheless, to the extent that, pursuant to the conversion
effected hereby, the Holder would have more shares than permitted under said
Section, this notice should be amended and revised, ab initio, to refer to
the
conversion which would result in the issuance of shares consistent with such
provision. Any conversion above such amount is hereby deemed void and revoked.
As
contemplated by the Note, this Notice of Conversion is being sent by facsimile
to the telecopier number and officer indicated above.
If
this
Notice of Conversion represents the full conversion of the outstanding balance
of the Converted Note, the Holder either (1) has previously surrendered the
Converted Note to the Company or (2) will surrender (or cause to be surrendered)
the Converted Note to the Company at the address indicated above by express
courier within five (5) Trading Days after delivery or facsimile transmission
of
this Notice of Conversion.
The
certificates representing the Conversion Shares should be transmitted by
the
Company to the Holder
o
via
express courier, or
o
by
electronic transfer
within
the time contemplated by the Note after receipt of this Notice of Conversion
(by
facsimile transmission or otherwise) to:
____________________________________
____________________________________
____________________________________
Exhibit
A
- Page 2
As
contemplated by the Note, the Company should also pay all accrued but unpaid
interest on the Converted Note to the Holder.
| -- |
If
the Company elects to pay such interest in Common Stock, as contemplated
by and subject to the provisions of the Note, such shares should
be issued
in the name of the Holder and delivered in the same manner as,
and
together with, the Conversion Shares.
|
| -- |
If
the Company elects or is required to pay the interest in cash,
such
payment should be made by wire transfer as follows:8
|
___________________________________
(Print
name of Holder)
By:
________________________________
(Signature of Authorized Person)
___________________________________
(Printed
Name and Title)
______________________________
8Information
should include the following:
All
Wires:
(1)
Bank Name
(2)
Xxxx Xxxxxxx (xxxxxxxxx xxxxxx, xxxx, xxxxx)
(3)
ABA or Wire Routing No.
(4)
Account Name
(5)
Account Number
If
Wire
is going to International (Non-US) Bank, all of the above plus:
(6)
SWIFT
Number
Exhibit
A - Page 3