EXHIBIT 10.14
This Note has not been registered under the Securities Act of 1933, as amended
(the "1933 Act") and the securities laws of any state. The Note has been
acquired for investment purposes only and not with a view to distribution or
resale, and may not be sold, assigned, made subject to a security interest,
pledged, hypothecated, transferred or otherwise disposed of unless and until
registered under the 1933 Act, or an opinion of counsel satisfactory to Kaire
International, Inc. is received that registration is not required under such
1933 Act or such state securities laws.
KAIRE INTERNATIONAL, INC.
$___,000.00
10% PROMISSORY NOTE
KAIRE INTERNATIONAL, INC., a Delaware corporation (the "Company"), for
value received, hereby promises to pay to_______________________ or registered
assigns (the "Holder") upon the earlier of (a) eighteen months after the date of
issuance of this Note (b) the completion date of an equity financing of the
Company pursuant to which it receives gross proceeds of not less than
$3,000,000, or (c) the Company's receipt of at least $1,000,000 in proceeds from
the "Key Man" life insurance policies on any of its executive officers and/or
directors (the "Maturity Date"), at the principal offices of the Company, the
principal sum of _____________________Thousand Dollars and no cents
($____,000.00) in such coin or currency of the United States of America as at
the time of payment shall be legal tender for the payment of public and private
debts, and to pay interest on the outstanding principal sum hereof at the rate
of ten percent (10%) per annum from the date hereof until the Company's
obligation with respect to the payment of such principal sum shall be discharged
as herein provided (the "Note"). Interest shall be due and payable on the
Maturity Date and shall accrue and be payable in like coin or currency to the
Holder hereof at the office of the Company as hereinafter set forth. In the
event that for any reason whatsoever any interest or other consideration payable
with respect to this Note shall be deemed to be usurious by a court of competent
jurisdiction under the laws of the State of New York or the laws of any other
state governing the repayment hereof, then so much of such interest or other
consideration as shall be deemed to be usurious shall be held by the Holder as
security for the repayment of the principal amount hereof or shall otherwise be
waived.
This Note is issued pursuant to the terms of a Subscription Agreement by
and between the Company and the Holder (the "Subscription Agreement"), a copy of
which agreement is available for inspection at the Company's principal office.
Notwithstanding any provision to the contrary contained herein, this Note is
subject and entitled to certain terms, conditions, covenants, rights and
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agreements contained in the Subscription Agreement. Any transferee or
transferees of this Note, by their acceptance hereof, assume the obligations of
the Holder in the Subscription Agreement with respect to the conditions and
procedures for transfer of this Note. Reference to the Subscription Agreement
shall in no way impair the absolute and unconditional obligation of the Company
to pay both principal and interest hereon as provided herein.
This Note is one of several notes of the Company issued in connection with
a Private Placement offering of the Company of up to $1,250,000 in Notes
("Notes.")
1. Transfers of Note to Comply with the 1933 Act
The Holder agrees that this Note may not be sold, transferred, pledged,
hypothecated or otherwise disposed of except as follows: (1) to a person who, in
the opinion of counsel to the Company, is a person to whom the Note may legally
be transferred without registration and without delivery of a current prospectus
under the 1933 Act and any applicable state securities laws with respect thereto
and then only against receipt of an agreement of such person to comply with the
provisions of this Section 1 with respect to any resale or other disposition of
the Note; or (2) to any person who complies with the provisions of this Section
1 with respect to any resale or other disposition of the Note; or (3) to any
person upon delivery of a prospectus then meeting the requirements of the 1933
Act relating to such securities and the offering thereof for such sale or
disposition, and thereafter to all successive assignees.
2. Prepayment
The principal amount of this Note may be prepaid by the Company, in whole
or in part without premium or penalty, at any time. Upon any prepayment of the
entire principal amount of this Note, all accrued, but unpaid, interest shall be
paid to the Holder on the date of prepayment.
3. Covenants of Company
a. The Company covenants and agrees that, so long as this Note shall
be outstanding, it will:
(i) Do or cause to be done all things necessary to preserve and keep
in full force and effect its corporate existence, rights and
franchises and comply with all laws applicable to the Company as its
counsel may advise;
(ii) At all times maintain, preserve, protect and keep its property
used and useful in the conduct of its business so that the business
carried on in connection therewith may be properly and advantageously
conducted in
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the ordinary course at all times;
(iii)Keep adequately insured by financially sound insurers, all
property of a character usually insured by similar corporations and
carry such other insurance as is usually carried by similar
corporations; and
(iv) At all times keep true and correct books, records and accounts.
4. Events of Default
a. This Note shall become due and payable immediately upon any of
the following events, herein called "Events of Default":
(i) Default in the payment of the principal or accrued interest on
this Note, when and as the same shall become due and payable, whether
by acceleration or otherwise;
(ii) Default in the due observance or performance of any covenant,
condition or agreement on the part of the Company to be observed or
performed pursuant to the terms hereof, if such default shall continue
uncured for thirty (30) days after written notice, specifying such
default, shall have been given to the Company by the Holder;
(iii)The entry of a final judgment, arbitration award or order against
the Company in an amount exceeding $100,000 which judgment remains
unsatisfied for ninety (90) days after the date of such entry;
(iv) Application for, or consent to, the appointment of a receiver,
trustee or liquidator for the Company or of its property;
(v) Admission in writing of the Company's inability to pay its debts
as they mature;
(vi) General assignment by the Company for the benefit of creditors;
(vii)Filing by the Company of a voluntary petition in bankruptcy or a
petition or an answer seeking reorganization, or an arrangement with
creditors; or
(viii)Entering against the Company of a court order approving a
petition filed against it under the federal bankruptcy laws, which
order shall not have been vacated or set aside or otherwise terminated
within ninety (90) days.
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b. In case any one or more of the Events of Default specified above
shall happen or be continuing, the Holder may proceed to protect and enforce his
or her right by suit in the specific performance of any covenant or agreement
contained in this Note or in aid of the exercise of any power granted in this
Note or may proceed to enforce the payment of this Note or to enforce any other
legal or equitable rights as such Holder may have.
c. In the event that the Company shall default in the payment of the
principal and interest on the later of the Maturity Date or its presentment for
payment, the total principal amount of and interest due upon all unpaid Notes
shall be automatically be due and payable.
5. Miscellaneous
a. This note has been issued by the Company pursuant to
authorization of the Board of Directors of the Company.
b. The Company may consider and treat the person in whose name this
Note shall be registered as the absolute owner thereof for all purposes
whatsoever (whether or not this Note shall be overdue) and the Company shall not
be affected by any notice to the contrary. Subject to the limitations herein
stated, the registered owner of this Note shall have the right to transfer this
Note by assignment, and the transferee thereof shall, upon his registration as
owner of this Note, become vested with all the powers and rights of the
transferor. Registration of any new owners shall take place upon presentation
of this Note to the Company at is principal offices, together with a duly
authenticated assignment. In case of transfer by operation of law, the
transferee agrees to notify the Company of such transfer and of his address, and
to submit appropriate evidence regarding the transfer so that this Note may be
registered in the name of the transferee. This Note is transferable only on the
books of the Company by the holder hereof, in person or by attorney, on the
surrender hereof, duly endorsed. Communications sent to any registered owner
shall be effective as against all holders of transferees of the Note not
registered at the time of sending the communication.
c. Payments of interest shall be made as specified above to the
registered owner of this Note. Payment of principal shall be made to the
registered owner of this Note upon presentation of this Note on or after
maturity. No interest shall be due on this Note for such period of time that
may elapse between the maturity of this Note and its presentation for payment.
d. The Holder shall not, by virtue, hereof, be entitled to any
rights of a stockholder in the Company, whether at law or in equity, and the
rights of the Holder are limited to those expressed in this Note.
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e. Upon receipt by the Company of evidence reasonably satisfactory
to it of the loss, theft, destruction or mutilation of this Note, and (in the
case of loss, theft or destruction) of reasonably satisfactory indemnification,
and upon surrender and cancellation of this Note, if mutilated, the Company
shall execute and deliver a new Note of like tenor and date. Any such new Note
executed and delivered shall constitute an additional contractual obligation on
the part of the Company, whether or not this Note so lost, stolen, destroyed or
mutilated shall be at any time enforceable by anyone.
f. This Note shall be construed and enforced in accordance with the
laws of the State of New York without regard to the conflicts of laws principles
thereof or the actual domiciles of the Company and the Holder. The Company and
the Holder hereby consent to the jurisdiction of the Courts of the State of New
York and the United States District Courts situated therein in connection with
any action concerning the provisions of this Note instituted by the Holder
against the Company.
IN WITNESS WHEREOF, KAIRE INTERNATIONAL, INC., has caused this Note to be
signed in its name by its President.
KAIRE INTERNATIONAL, INC.
Date: ________________________, 1997 By: _______________________________
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