Exhibit 4.1
$_____________________ March ____, 2007
UWINK, INC
10% CONVERTIBLE PROMISSORY NOTE
DUE SEPTEMBER ____, 2007
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED (THE "1933 ACT"), AND SUCH SECURITY MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO REGISTRATION UNDER THE 1933
ACT, OR PURSUANT TO AN APPLICABLE EXEMPTION FROM REGISTRATION AS CONFIRMED IN AN
OPINION OF COUNSEL SATISFACTORY TO THE COMPANY, AND IN EACH CASE IN ACCORDANCE
WITH ANY OTHER APPLICABLE LAW.
1. OBLIGATION. For value received, UWINK, INC., a Utah corporation (the
"COMPANY"), promises to pay to the order of _____________________ (the "HOLDER")
in lawful money of the United States of America and in immediately available
funds, the principal sum of _____________________ Dollars
(US$_____________________), in the manner and upon the terms and conditions set
forth herein.
This Note is one of a series of duly authorized convertible promissory
notes of the Company (individually, a "NOTE" and collectively, the "NOTES")
having like terms and maturity in the aggregate principal amount of up to
$1,000,000. It is the intent of the parties that the rights of the Holder of
this Note will rank IN PARI PASSU in all respects with the rights of the Holders
of the other Notes.
2. MATURITY. The entire principal amount hereof, together with accrued and
unpaid interest thereon, will be due and payable six months from the date hereof
(the "MATURITY DATE"), unless earlier paid in full or converted in accordance
with Section 5 hereof.
3. INTEREST. The Company shall pay interest at the rate of 10% per annum,
compounded annually (computed on the basis of a 365-day year) during the period
beginning on the date of issuance of this Note and ending on the date the
principal amount of this Note becomes due and payable.
4. PREPAYMENT. The Company may, at its sole discretion, prepay all or any
portion of the unpaid principal of this Note without penalty at any time.
5. CONVERSION. The principal and accrued and unpaid interest amount of
this Note will be subject to conversion, at the option of the Holder, into the
same securities issued pursuant to (and on the same terms and conditions pari
passu with the investors in) any offering of securities ("Follow-On Securities")
by the Company resulting in gross proceeds to the Company of at least $3,000,000
("Follow-On Offering"). If so elected by the Holder, contemporaneous with the
consummation of the Follow-On Offering, the entire then outstanding principal
amount and accrued and unpaid interest of this Note shall be converted (the
"Conversion") into Follow-On Securities. The pro rata percentage of Follow-On
Securities which shall be issued by the Company to the undersigned upon the
Conversion shall be equal to: the sum of (1) the original principal amount plus
the then current accrued and unpaid interest, plus (2) twenty percent (20%) of
such total amount (such sum, the "Conversion Amount"), divided by (1) the total
dollar amount received by the Company pursuant to the Follow-On Offering, plus
(2) the Conversion Amount. The Follow-On Securities issued to the Holder upon
the Conversion shall be of the same type and class, and shall contain the
identical rights and restrictions, as the securities issued by the Company in
the Follow-On Offering. The Conversion shall be effected by the Company applying
the entire then outstanding principal amount and accrued interest of this Note
in full payment of the Follow-On Securities to be issued in consequence of the
Conversion and that application shall discharge the Company from all liability
in respect of the entire then outstanding principal amount and accrued interest
of this Note.
6. SECURITY. The debt evidenced by this Note shall be secured by the
assets of the Company (pro-rata with the other Notes), other than any assets of
the Company that secure any debt of the Company outstanding on the date hereof.
7. EXPENSES OF ENFORCEMENT. The Company agrees to pay all reasonable costs
and expenses, including without limitation reasonable attorneys' fees, as a
court of competent jurisdiction may award that the Holder incurs in connection
with any legal action or legal proceeding commenced for the collection of this
Note or the exercise, preservation or enforcement of the Holder's rights and
remedies hereunder.
8. CUMULATIVE RIGHTS AND REMEDIES. All rights and remedies of the Holder
under this Note will be cumulative and not alternative and will be in addition
to all rights and remedies available to the Holder under applicable law.
9. GOVERNING LAW. This Note will be governed by and interpreted and
construed in accordance with the laws of the State of California. Any action or
proceeding arising under or pursuant to this Note will be brought in Los Angeles
County, California.
IN WITNESS WHEREOF, the Company has caused this Note to be executed by its
duly authorized officer as of the day and year first above written.
UWINK, INC.
a Utah corporation
By: /s/ Xxxxx X. Xxxxxxxx
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Xxxxx X. Xxxxxxxx,
Chief Executive Officer