DEBENTURE
Exhibit
10.02
Exhibit
I to Exclusive Option Agreement
THESE
SECURITIES HAVE NOT BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND
EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), OR THE SECURITIES COMMISSION OF ANY STATE UNDER ANY STATE
SECURITIES LAW. THEY ARE BEING OFFERED PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER REGULATION D (“REGULATION D”) PROMULGATED UNDER THE
SECURITIES ACT. THE SECURITIES MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED UNLESS THE SECURITIES ARE REGISTERED UNDER THE SECURITIES ACT AND
APPLICABLE STATE SECURITIES LAWS, OR SUCH OFFERS, SALES AND TRANSFERS ARE MADE
PURSUANT TO AVAILABLE EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND THOSE LAWS.
THESE
SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES
COMMISSION OR REGULATORY AUTHORITY, ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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U.S.$16,000,0008*
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Issuance
Date: February 12, 0000
XXXXX XX.
ENERGY, INC.
5%
CONVERTIBLE DEBENTURE DUE
THIS 5% CONVERTIBLE DEBENTURE,
issued this 12th day of February 2009, is duly authorized issued 5% Convertible
Debentures (including all 5% Convertible Debentures issued in exchange, transfer
or replacement hereof, this “Debenture”)
of Green St. Energy, Inc., a corporation duly organized and existing
under the law of the State of Delaware (the “Company”), designated
as its 5% Convertible Debentures Due February 12, 2012, in an aggregate
principal amount of U.S.$16,000,000 (collectively, the “Debentures” and such
other Debentures, the “Other Debentures”) as
consideration for the option to purchase certain parcels of unimproved property
dedicated and intended to be used for generating distribution and sale of wind
energy as more fully described and set forth in the Option to Purchase
Unimproved Land to which this Debenture is an exhibit thereto.
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FOR VALUE RECEIVED, the
Company promises to pay to The Nacelle Corporation, the registered holder hereof
(the “Holder”),
the principal sum of $16,000,000*, on or
prior to February 12, 2012 (the “Maturity Date”), and
to pay interest on the principal sum outstanding time to time on the yearly
anniversary of the issuance date set forth above (the “Issuance Date”) of
this Debenture (each an “Interest Payment
Date”), commencing February 12, 2010, up to and including the
Maturity Date, at the rate of 5% per annum, and shall be computed on the basis
of a 365-day year and actual days elapsed. Accrual of interest on
this Debenture shall commence on the Issuance Date and shall continue to accrue
until the next Interest Payment Date. The interest so payable will be
paid on each Interest Payment Date to the person in whose name this Debenture
(or one or more predecessor Debentures) is registered on the records of the
Company regarding registration and transfers of the Debentures (the “Debenture Register”)
on the first business day prior to such Interest Payment Date. Notwithstanding
the foregoing, the Company may elect to forego paying interest until such time
as this Debenture matures, is converted or redeemed, as the case may
be. All accrued and unpaid interest shall bear interest at the same
rate of 5% per annum from the date hereof until the date of
payment. The principal of this Debenture is payable in coin or
currency of the United States of America as at the time of payment is legal
tender for public and private debts or, at the option of
Holder, in shares of Common Stock, par value $0.005 per share (the “Common Stock”), under
the same conversion formula as stated herein at the address of the Holder last
appearing on the Debenture Register of the Company as designated in writing by
the Holder. Notwithstanding the foregoing, the Holder may not receive
payment of principal or interest in the form of Common Stock in the event the
issuance of said shares of Common Stock would result in the Holder having an
ownership interest in the Company’s Common Stock of greater than 19.99% unless
shareholder approval is obtained for same (the “Ownership Cap”). The
Debenture Register shall represent the record of ownership and right to receive
principal and interest payments on this Debenture. Interest and
principal shall be payable only to the registered Holder as reflected in the
Debenture Register. At the Company’s option, interest on the within
Debenture will be payable in cash or shares of Common Stock under the conversion
formulas as stated herein. The right to receive principal and
interest payments under this Debenture shall be transferable only through an
appropriate entry in the Debenture Register as provided herein.
This
Debenture and the Common Stock underlying this Debenture is subject to the
following additional provisions:
1. Debentures. The
Debentures are exchangeable for an equal aggregate principal amount of
Debentures of different authorized denominations, as requested by the Holders
surrendering the same, but shall not be issuable in denominations less than
integral multiples of ten thousand dollars ($10,000). No service
charge will be made for such registration of transfer or exchange.
2. Withholding. The
Company shall be entitled to withhold, if applicable, from all payments of
interest on this Debenture, any amounts required to be withheld under the
applicable provisions of the United States income tax laws or other applicable
laws at the time of such payments. The Holder shall pay all taxes,
charges, or levies in connection with the issuance or transfer thereof other
than amounts so withheld.
3. Transfer. This
Debenture has been issued subject to investment representations of the original
purchaser hereof and may be transferred, assigned or exchanged only in
compliance with the Securities Act of 1933, as amended (the “Securities Act”),
including Regulation D promulgated under the Securities Act. Any
Holder of this Debenture, by acceptance hereof, agrees to the representations,
warranties and covenants herein. Prior to due presentment to the
Company for transfer of this Debenture, the Company and any agent of the Company
may treat the person in whose name this Debenture is duly registered on the
Company’s Debenture Register as the owner hereof for the purpose of receiving
payment as herein provided and for all other purposes, whether or not this
Debenture be overdue, and neither the Company nor any such agent shall be
affected by notice to the contrary.
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4. Conversion; Other
Agreements. The record Holders of this Debenture shall have
conversion rights as follows (the “Conversion
Rights”):
(a) Right to
Convert. Subject to the Ownership Cap, the record Holder of
this Debenture shall be entitled, at the option of the Holder, to convert any or
all of the aggregate principal and accrued and unpaid interest of Debentures
held by such Holder, at any time after one hundred eighty (180) days after the
date of issuance of this Debenture, at the office of the Company or any transfer
agent for the Debentures, into that number of fully-paid and non-assessable
shares of Common Stock of the Company calculated in accordance with the
following formulas (collectively, the “Conversion
Rate”):
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(i)
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The
number of shares of Common Stock to be issuable upon conversion of any
principal and/or interest (should the Company elect to pay interest in
shares of its Common Stock) amount shall be determined by dividing (x) the
principal amount of this Debenture to be converted by (y) the Fixed
Conversion Price (as defined herein). The term “Fixed Conversion
Price” means $0.5517, subject to adjustment as provided
herein.
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(ii)
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Mechanics of
Conversion. In order to convert Debentures into shares
of Common Stock, the Holder shall surrender the certificate or
certificates therefor, duly endorsed, by either overnight courier or 2-day
courier, to the office of the Company or of any transfer agent for the
Debentures, and shall give written notice to the Company at such office
with a copy to Chief Executive Officer, tel. (000) 000-0000, facsimile
(000) 000-0000, that such Holder elects to convert the same, the amount of
principal and/or interest of the Debentures to be so converted and a
calculation of the number of shares of Common Stock to be issued upon
conversion; provided, however, that
the Company shall not be obligated to issue certificates evidencing the
shares of Common Stock issuable upon such conversion unless either the
certificates evidencing such Debentures are delivered to the Company or
its transfer agent as provided above, or the Holder notifies the Company
or its transfer agent that such certificates have been lost, stolen or
destroyed and executes an agreement satisfactory to the Company to
indemnify the Company from any loss incurred by it in connection with such
certificates.
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The
Company shall issue and deliver to the Holder within five (5) business days
after delivery to the Company of such Debenture certificates, or after such
agreement and indemnification, to such Holder of Debentures at the address of
the Holder on the books of the Company, a certificate or certificates for the
number of shares of Common Stock to which the Holder shall be entitled as
aforesaid. The date on which notice of conversion is given (the
“Date of
Conversion”) shall be deemed to be the date in such notice of conversion
is received by the Company; provided, that the
original Debentures to be converted are received by the transfer agent or the
Company within five (5) business days thereafter, and the person or persons
entitled to receive the shares of Common Stock issuable upon such conversion
shall be treated for all purposes as the record holder or holders of such shares
of Common Stock on such date. If the original Debentures to be
converted are not received by the transfer agent or the Company within five (5)
business days after the Date of Conversion, the notice of conversion shall
become null and void.
Following
conversion of a Debenture, or a portion thereof, the principal and, upon payment
thereof of the interest owed on that Debenture or portion of the Debenture so
converted will be deemed paid in full and satisfied, and such Debenture or
portion thereof will no longer be outstanding. If this Debenture
should be converted in part only, the Company shall promptly, upon surrender of
this Debenture, execute and deliver a new Debenture. Whenever the Company is
required to issue a new Debenture pursuant to the terms of this Debenture, such
new Debenture (i) shall be of like tenor with this Debenture, (ii) shall
represent, as indicated on the face of such new Debenture, the principal amount
remaining outstanding, (iii) shall have an issuance date, as indicated on the
face of such new Debenture, which is the same as the Issuance Date of this
Debenture, (iv) shall have the same rights and conditions as this Debenture, and
(v) shall represent the proportionate amount of accrued interest on the
principal amount and interest of this Debenture that correspond to the principal
of the new Debenture, from the Issuance Date.
(b) Reservation of Stock
Issuable Upon Conversion. The Company shall at all times
reserve and keep available out of its authorized but unissued shares of Common
Stock, solely for the purpose of effecting the conversion of the Debenture, such
number of its shares of Common Stock as shall from time to time be sufficient to
effect the conversion of all then outstanding Debenture. The Company covenants
that all shares of Common Stock to be issued upon conversion of this Debenture
are validly authorized and reserved for issuance and, if and when this Debenture
is converted in whole or in part the shares of Common Stock issued will be duly
and validly issued, fully paid, nonassessable, without any personal liability
attaching to the ownership thereof, and will not be issued in violation of any
preemptive or other rights of shareholders.
(c) Mandatory Payment or
Conversion on Maturity Date. Each Holder of a Debenture
outstanding on the Maturity Date, shall have the right to payment of all
principal (and any accrued and unpaid interest thereon) on this Debenture paid
to such Holder in cash or in immediately available funds or, at the option of
the Holder and subject to the Ownership Cap, in shares of Common Stock computed
in accordance with Section 4 above. On the Maturity Date, the Company
shall pay to the Holder an amount in cash, in immediately available funds or, at
the option of the Holder and subject to the Ownership Cap, in shares of Common
Stock computed in accordance with Section 4 above an amount equal to the then
outstanding principal amount (and any accrued and unpaid interest thereon) on
this Debenture.
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(d) Adjustment to Conversion
Price.
(i) If,
prior to the conversion of all of the Debentures, the number of outstanding
shares of Common Stock is increased by a stock split, stock dividend or other
similar event, then the Fixed Conversion Price shall be proportionately
reduced. If prior to conversion of all the Debentures, the number of
outstanding shares of Common Stock is decreased by a reverse stock split,
combination or reclassification of shares, or other similar event, the Fixed
Conversion Price shall be proportionately increased.
(ii) No
adjustment need be made if it would result in a change of less than 1% of the
Conversion Price. Any adjustments required to be made by this
subsection shall be rounded up to the right to acquire the nearest whole number
of shares of Common Stock.
(e) No Charges or
Taxes. The issuance of certificates for shares of Common Stock
upon conversion of this Debenture shall be made without charge to Holder or the
purchaser of any issuance tax in respect thereof or other cost incurred by the
Company in connection with such conversion and the related issuance of shares of
Common Stock issuable upon conversion.
(f) No
Interference. The Company shall not close its books against
the transfer of this Debenture or of any shares of Common Stock issued or
issuable upon the conversion of this Debenture in any manner which interferes
with the timely conversion of this Debenture.
(g) Assistance. The
Company shall assist and cooperate with any reasonable request by the Holder or
any purchaser which is required to make any governmental filings or obtain any
governmental approvals prior to or in connection with any conversion of this
Debenture.
(h) Contingent
Conversion. Notwithstanding any other provision hereof, if a
conversion of any portion of this Debenture is to be made in connection with a
public offering or sale of the Company (pursuant to a merger, sale of stock or
otherwise), such exercise may at the election of the Holder be conditioned upon
the consummation of such transaction, in which case such exercise shall not be
deemed to be effective until immediately prior to consummation of such
transaction.
(i) Certain
Actions. The Company shall take all such actions as may be
necessary to ensure that all shares of Common Stock that may be issued without
violation by the Company of any applicable law or governmental regulation or any
requirements of any domestic securities exchange or quotation system upon which
shares of Common Stock or other securities constituting securities that may be
issuable upon conversion of this Debenture may be listed or quoted (except for
official notice of issuance which shall be immediately delivered by the Company
upon each such issuance). The Company will use its best efforts to cause the
shares of Common Stock issued upon conversion of this Debenture, immediately
upon such conversion, to be listed on any domestic national securities exchange
or quotation system upon which shares of Common Stock or other securities
issuable upon conversion of this Debenture are listed or quoted at the time of
such exercise.
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(j) Non-Circumvention. The
Company shall not, and shall not permit its subsidiaries to, directly or
indirectly, by any action avoid or seek to avoid the observance or performance
of any terms of this Debenture or impair or diminish its value, but shall at all
times in good faith assist in carrying out of all such terms of this
Debenture.
(k) Authority. The
Company has all requisite corporate power and authority to enter into and
perform its obligations under this Debenture and to issue and deliver the
Debenture to the Holder. The execution, delivery, and performance by
the Company of its obligations under this Debenture, including the issuance and
delivery of the Debenture to the Holder, have been duly authorized by all
necessary corporate action on the part of the Company. This Debenture
has been duly executed and delivered by the Company and is a legal, valid and
binding obligation of the Company and is enforceable against the Company in
accordance with its terms.
(l) Governmental
Actions. Without limiting the generality of the foregoing, the
Company shall obtain all such authorizations, exemptions or consents from any
public regulatory body having jurisdiction thereof as may be necessary to enable
the Company to perform its obligations under this Debenture.
(m) Registration
Rights. The Holder shall have cost free piggy bank
registration rights for the shares underlying this Debenture.
5. Redemption.
(a) Right to
Redeem. Except as provided in Sections 5(b) and (d) herein,
the Company may at its sole option elect to redeem this Debenture in accordance
with Section 5(c).
(b) Right to Redeem on
Conversion. The Company shall not have the right, after
receipt of a notice of conversion pursuant to Section 4, to redeem in whole or
in part any Debentures submitted for conversion. If the Company
wishes to redeem some, but not all, of the Debentures previously submitted for
conversion, the Company shall notify the Holder on five (5) days written notice,
and it will be the option of the Holder to elect to have the Debenture
redeemed.
(c) Mechanics of Redemption on
Conversion. Following one hundred and eighty (180) days of
issuance of the Debentures the Company shall effect each such redemption by
giving notice of its election to redeem, by facsimile to Holder. Such
redemption notice shall indicate whether the Company will redeem all or part of
the Debentures. The Company shall not be entitled to send any notice
of redemption and begin the redemption procedure unless it has the full amount
of the redemption price, in cash, available in a demand or other immediately
available account in a bank or similar financial institution on the date the
redemption notice is sent to Holder.
(d) Mechanics of Conversion on
Redemption. Subject to the Ownership Cap, the Holder may
following a minimum of one hundred and eighty (180) days of issuance of the
Debentures and within three (3) business days of receipt of the Notice of
Redemption elect to send Notice of Conversion to the Company should Holder wish
for the Debenture to be converted rather than redeemed by the
Company.
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(e) Redemption
Price. The redemption price per Debenture shall equal one
hundred percent (100%) multiplied by the then outstanding principal amount plus
unpaid interest to the date of redemption.
The
redemption price shall be paid in cash to the Holder of Debentures redeemed
within ten (10) business days of the delivery of the notice of such redemption
to such Holder; provided, however, that the
Company shall not be obligated to deliver any portion of such redemption price
unless either the certificates evidencing the Debentures redeemed are delivered
to the Company or its transfer agent as provided in Section 4(b), or the Holder
notifies the Company or its transfer agent that such certificates have been
lost, stolen or destroyed and executes an agreement satisfactory to the Company
to indemnify the Company from any loss incurred by it in connection with such
certificates.
6. No
Impairment. Except as expressly provided herein, no provision
of this Debenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of, and interest on, this
Debenture at the time, place, and rate, and in the coin or currency, or Common
Stock herein
prescribed. This Debenture and all other Debentures now and hereafter issued of
similar terms are direct obligations of the Company.
7. Termination. After
this Debenture shall have been surrendered for conversion as herein provided or
notice of redemption shall have been given by the Company pursuant to Section
4(d) herein, this Debenture shall no longer be deemed to be outstanding and all
rights with respect to this Debenture, including, without limitation, the right
to receive interest hereon and the principal hereof, shall forthwith terminate
as of the Date of Conversion, except only the right of the Holder hereof to
receive shares of Common Stock in exchange therefore. Notwithstanding
anything to the contrary herein, if the Holder or the Company, as applicable, is
converting less than the outstanding principal amount and/or less than the
amount of unpaid interest accrued thereon, then the rights and obligations under
this Debenture shall terminate only with respect to the principal and/or
interest being so converted.
8. [Intentionally
Deleted]
9. Costs and
Expenses. The Company agrees to pay all costs and expenses,
including reasonable attorney’s fees, which may be incurred by the Holder in
collecting any amount due under this Debenture.
10. Events of Default;
Remedies. If one or more of the following described “Events of Default”
shalloccur:
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(a) The
Company shall default in the payment of principal or interest on these
Debentures; or
(b) The
Company shall fail to perform or observe, in any material respect, any other
covenant, term, provision, condition, agreement or obligation of the Company
under this Debenture and such failure shall continue uncured for a period of
fifteen (15) business days after notice from Holder of such failure;
or
(c) The
Company or any of its subsidiaries 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
(d) A
trustee, liquidator or receiver shall be appointed for the Company, any of its
subsidiaries or for a substantial part of their respective property or business
without their consent and shall not be discharged within sixty (60) business
days after such appointment; or
(e) 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 or any of its
subsidiaries and shall not be dismissed within sixty (60) business days
thereafter; or
(f) 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 or any of its subsidiaries and, if
instituted against the Company or any of its subsidiaries shall not be dismissed
within sixty (60) business days after such instruction or if the Company or any
of its subsidiaries 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 proceeding; or
(g) The
Common Stock shall not be traded on an exchange or quoted or an automated
trading system such as the Over the Counter Bulletin Board or the Pink
Sheets.
Then, or
at any time thereafter, and in each and every such case, unless such Event or
Default shall have been waived in writing by the Holder (which waiver shall not
be deemed to be a waiver of any subsequent default) at the option of the Holder
and in the Holder’s sole discretion, the principal (and any accrued interest)
amount of this Debenture shall become immediately due and payable, without
presentment, demand protest or notice of any kind, 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, and with
expiration of any period of grace, enforce any and all of the Holder’s rights
and remedies provided herein or any other rights or remedies afforded by
law.
11. Mergers, Consolidations,
Change of Control, etc.
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(a) Change of
Control. Each of the following events shall constitute a
“Change of
Control”:
(i) the
consolidation, merger or other business combination (including, without
limitation, a reorganization or recapitalization) of the Company with or into
another person or entity (other than (A) a consolidation, merger or other
business combination (including, without limitation, reorganization or
recapitalization) in which holders of the Company’s voting power immediately
prior to the transaction continue after the transaction to hold, directly or
indirectly, the voting power of the surviving entity or entities necessary to
elect a majority of the members of the board of directors (or their equivalent
if other than a corporation) of such entity or entities, or (B) pursuant to a
migratory merger effected solely for the purpose of changing the jurisdiction of
incorporation of the Company);
(ii) the
sale or transfer of all or substantially all of the Company’s assets;
or
(iii) a
purchase, tender or exchange offer made to and accepted by the holders of more
than the 80% of the outstanding shares of Common Stock.
No sooner
than 21 days nor later than 15 days prior to the consummation of a Change of
Control the Company shall deliver written notice thereof via facsimile and
overnight courier to the Holder (a “Change of Control
Notice”). Notwithstanding anything herein to the contrary, (x)
no Change of Control Notice shall be made prior to the public announcement of a
Change of Control and (y) no Change of Control Notice shall be made prior to the
consummation of the Change of Control described in (a)(iii)
above. Notwithstanding anything herein to the contrary, the Change of
Control Notice shall be delivered no later than one Business Day following the
events described in (x) and (y) of the preceding sentence.
(b) Assumption. Prior
to the consummation of any Change of Control, the Company will secure from any
person or entity purchasing the Company’s assets or Common Stock or any
successor resulting from such Change of Control (in each case, an “Acquiring Entity”) a
written agreement (in form and substance satisfactory to the holders of
Debentures representing at least a majority of the aggregate principal amount of
the Debentures then outstanding) to deliver to each holder of Debentures in
exchange for such Debentures, a security of the Acquiring Entity evidenced by a
written instrument substantially similar in form and substance to the
Debentures, including, without limitation, having a principal amount and
interest rate equal to the principal amounts and the interest rates of the
Debentures held by such holder, and satisfactory to the holders of Debentures
representing at least a majority of the aggregate principal amount of the
Debentures then outstanding. In the event that an Acquiring
Entity is directly or indirectly controlled by a company or entity whose common
stock or similar equity interest is listed, designated or quoted on a securities
exchange or trading market, the holders of Debentures representing at least a
majority of the aggregate principal amount of the Debentures then outstanding
may elect to treat such person or entity as the Acquiring Entity for purposes of
this Section 11(b).
(c) Other Corporate
Events. Prior to the consummation of any recapitalization,
reorganization, consolidation, merger, spin-off or other business combination
(other than a Change of Control) pursuant to which holders of Common Stock are
entitled to receive securities or other assets with respect to or in exchange
for Common Stock (a “Corporate Event”),
the Company shall make appropriate provision to insure that the Holder will
thereafter have the right to receive upon a conversion of this Debenture, (i) in
addition to the shares of Common Stock receivable upon such conversion, such
securities or other assets to which the Holder would have been entitled with
respect to such shares of Common Stock had such shares of Common Stock been held
by the Holder upon the consummation of such Corporate Event or (ii) in lieu of
the shares of Common Stock otherwise receivable upon such conversion, such
securities or other assets received by the holders of Common Stock in connection
with the consummation of such Corporate Event in such amounts as the Holder
would have been entitled to receive had this Debenture initially been issued
with conversion rights for the form of such consideration (as opposed to shares
of Common Stock) at a conversion rate for such consideration commensurate with
the Conversion Rates.
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12. Lost or Destroyed
Debenture. If this Debenture shall be mutilated, lost, stolen
or destroyed, the Company shall execute and deliver, in exchange and
substitution for and upon cancellation of a mutilated Debenture, or in lieu of
or in substitution for a lost, stolen or destroyed Debenture, a new Debenture
for the principal amount of this Debenture so mutilated, lost, stolen or
destroyed, but only upon receipt of evidence of such loss, theft or destruction
of such Debenture, and of the ownership thereof, and indemnity and bond, if
requested, all reasonably satisfactory to the Company.
13. Compliance With Securities
Laws. The Holder and its affiliates covenant and warrant not
to engage in any actions deemed to be viewed as manipulative to the Common Stock
such as by way of example, short sales of the Common Stock.
14. Governing
Law. This Debenture shall be governed by and construed in
accordance with the laws of the State of New York, without giving effect to the
principles of conflicts of laws.
15. Business Day
Definition. For purposes hereof, the term “business day” shall
mean any day on which banks are generally open for business in the State of New
York, USA and excluding any Saturday and Sunday.
16. Notices. Any
notice, demand or request required or permitted to be given by either the
Company or the Holder pursuant to the terms of this Debenture shall be in
writing and shall be deemed given when delivered personally, or by facsimile
(with a hard copy to follow by two day courier), addressed to the Company
attention Vice President of Finance at 000 Xxxxx Xxxxxx, Xxxxxxxxx,
XX 00000, tel. 000-000-0000, facsimile 000-000-0000 with a copy to
Xxxxxxx, Xxxxxxx & Xxxxxx, attn: Xxxxxx Xxxxxxx, Esq., tel.
000-000-0000, facsimile 212-750-8297, or the Holder at (000) 000-0000, or such
other addresses as a party may request by notifying the other in
writing.
17. Waiver. Any
waiver by the Company or the Holder hereof of a breach of any provision of this
Debenture shall not operate as or be construed to be a waiver of any breach of
such provision or of any breach of any other provision of this
Debenture. The failure of the Company or the Holder hereof to insist
upon strict adherence to any term of this Debenture on one or more occasions
shall not be considered a waiver or deprive that party of the right thereafter
to insist upon strict adherence to that term or any other term of this
Debenture. Any waiver must be in writing.
18. Notices of Certain
Actions. In case at any time the Company shall propose
to:
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(a) pay
any dividend or make any distribution on shares of Common Stock in shares of
Common Stock or equivalents thereto or make any other distribution;
or
(b) issue
any rights, warrants or other Common Stock to all holders of Common Stock
entitling them to purchase any additional shares of Common Stock or any other
rights, debentures, warrants or other Common Stock; or
(c) effect
any reclassification or change of outstanding shares of Common Stock, or any
consolidation, merger, sale, lease or conveyance of property, described in
Sections 4 or 11 hereof; or
(d) effect
any liquidation, dissolution or winding-up of the Company; or
(e) take
any other action which would cause an adjustment to the Fixed Conversion Price;
or
(f) provide
to its shareholders any information which is regularly provided to
shareholders,
then, and
in any one or more of such cases (a) through (f), the Company shall, subject to
any other Sections of this Debenture, give written notice thereof, by certified
mail, postage prepaid, to the Holder at the Holder’s address as it shall appear
in the Debenture Register, mailed at least fifteen (15) days prior to (i) the
date as of which the holders of record of shares of securities to be entitled to
receive any such dividend, distribution, rights, debentures, warrants or other
securities are to be determined, (ii) the date on which any such
reclassification, change of outstanding shares of Common Stock, consolidation,
merger, sale, lease, conveyance of property, liquidation, dissolution or
winding-up is expected to become effective, and the date as of which it is
expected that holders of record of shares of Common Stock shall be entitled to
exchange their shares for securities or other property, if any, deliverable upon
such reclassification, change of outstanding shares, consolidation, merger,
sale, lease, conveyance of property, liquidation, dissolution or winding-up, or
(iii) the date of such other action which would require an adjustment to the
Fixed Conversion Price. In the case of subsection (f) above, written
notice to the Holder may be given by regular mail.
19. Unenforceable
Provisions. If any provision of this Debenture is invalid,
illegal or unenforceable, the balance of this Debenture shall remain in effect,
and if any provision is inapplicable to any person or circumstance, it shall
nevertheless remain applicable to all other persons and
circumstances.
20. Restriction on Redemption
and Dividends. Until all of the Debentures have been
converted, redeemed or otherwise satisfied in accordance with their terms, the
Company shall not, directly or indirectly, (A) repurchase, redeem, or declare or
pay any cash dividend or distribution on, the Common Stock or (B) distribute any
material property or assets of any kind to holders of the Common Stock in
respect of the Common Stock.
21. Rank. Obligations
under this Debenture, including payments of principal and interest and other
payments due under this Debenture, shall rank pari passu with all Other
Debentures.
22. Vote to Issue, or Change the
Terms of, Debentures. The affirmative vote at a meeting duly
called for such purpose or the written consent without a meeting of the holders
of Debentures representing not less than a majority of the aggregate principal
amount of the then outstanding Debentures shall be required for any change or
amendment to this Debenture or the Other Debentures; provided, that the
Holder of this Debenture may waive any term or provision of this Debenture
without such vote or written consent.
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23. Payment of Collection,
Enforcement and Other Costs. If (a) this Debenture is placed
in the hands of an attorney for collection or enforcement or is collected or
enforced through any legal proceeding or the Holder otherwise takes action to
collect amounts due under this Debenture or to enforce the provisions of this
Debenture or (b) there occurs any bankruptcy, reorganization, receivership of
the Company or other proceedings affecting Company creditors’ rights and
involving a claim under this Debenture, then the Company shall pay the
reasonable costs incurred by the Holder for such collection, enforcement or
action or in connection with such bankruptcy, reorganization, receivership or
other proceeding, including, but not limited to, reasonable attorneys’ fees and
disbursements.
24. Construction;
Headings. This Debenture shall be deemed to be jointly drafted
by the Company and the Holder and shall not be construed against any person as
the drafter hereof. The headings of this Debenture are for
convenience of reference and shall not form part of, or affect the
interpretation of, this Debenture.
25. Remedies, Characterizations,
Other Obligations, Breaches and Injunctive Relief. The
remedies provided in this Debenture shall be cumulative and in addition to all
other remedies available under this Debenture and any of the other Transaction
Documents (as defined in the Subscription Agreement), at law or in equity
(including a decree of specific performance and/or other injunctive relief), and
nothing herein shall limit the Holder’s right to pursue actual damages for any
failure by the Company to comply with the terms of this
Debenture. Amounts set forth or provided for herein with respect to
payments, conversion and the like (and the computation thereof) shall be the
amounts to be received by the Holder and shall not, except as expressly provided
herein, be subject to any other obligation of the Company (or the performance
thereof). The Company acknowledges that a breach by it of its
obligations hereunder will cause irreparable harm to the Holder and that the
remedy at law for any such breach may be inadequate. The Company
therefore agrees that, in the event of any such breach or threatened breach, the
Holder shall be entitled, in addition to all other available remedies, to an
injunction restraining any breach, without the necessity of showing economic
loss and without any bond or other security being required.
26. Waiver of
Notice. To the extent permitted by law, the Company hereby
waives demand, notice, protest and all other demands and notices in connection
with the delivery, acceptance, performance, default or enforcement of this
Debenture and the Subscription Agreement.
27. Further
Acknowledgement. The Company will, at the time of each
conversion of this Debenture, upon the request of the Holder hereof, acknowledge
in writing its continuing obligation to afford to such Holder all rights
(including, without limitation, any rights to registration, pursuant to the
Registration Rights Agreement, of the shares of Common Stock issued upon such
conversion) to which such Holder shall continue to be entitled after such
conversion in accordance with its terms of this Debenture; provided,
that if the Holder of this Debenture shall fail to make any such requests, such
failure shall not affect the continuing obligation of the Company to afford such
rights to such Holder.
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IN WITNESS WHEREOF, the
Company has caused this Debenture to be duly executed by an officer thereof duly
authorized.
By:/s/ Xxxxxxx
Xxxxxxx
Title: Chairman
and CEO
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EXHIBIT
A
NOTICE
OF CONVERSION
(To be
Executed by the Registered Holder
in order
to Convert the Debenture)
The
undersigned hereby elects to convert the attached Debenture into shares of
common stock, $0.005 par value per share (the “Common Stock”), of
Green St. Energy, Inc. (the “Company”) according
to the conditions hereof, as of the date written below. If shares are
to be issued in the name of a person other than the undersigned, the undersigned
will pay all transfer taxes payable with respect thereto and is delivering
herewith such certificates and opinions as reasonably requested by the Company
in accordance therewith. No fee will be charged to the holder for any
conversion, except for such transfer taxes, if any.
Conversion
calculations: _______________________________________
Date to Effect Conversion
_______________________________________
Principal
Amount of Debentures to be Converted
Payment
of Interest in
Kind o Yes
o No
_________________________________________
Interest
Accrued on Account of Conversion at Issue
_______________________________________
Number of
shares of Common Stock to be Issued
_______________________________________
Applicable
Conversion Price
_______________________________________
Signature
The Nacelle
Corporation_____________________
Name
00000 Xxxxxxxx Xx, Xxxxxx
Xxxxx, XX 91302_____
Address
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