EXHIBIT 99.2
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NATIONAL DATACOMPUTER, INC.
000 XXXXXXXXX XXXXXXXX
XXXXXXXXXX, XXXXXXXXXXXXX 00000
January 11, 2007
[Name and Address Of
Officer/Director]
Dear _____l:
In connection with your proposed purchase of shares of National
Datacomputer, Inc., enclosed please find a form of Convertible Promissory Note
and a Share Transfer Agreement.
Under the terms of this arrangement, investors are purchasing shares of
the Company's Common Stock at a price of $.0197764 per share. This translates to
___________ shares (the "Shares") for your investment of $____.
The Board has determined to not sell the Shares until it has received
approval from the stockholders of the Company for this transaction with officers
and directors. The attached Note provides for automatic conversion of the Note
into the Shares upon receipt of such stockholder approval. If the approval does
not occur, then the note will be due and payable on June 30, 2008 and will
accrue interest at the rate of prime plus 2%.
If the foregoing correctly sets forth our understanding, kindly sign
and return this letter together with a copy of the attached Share Transfer
Agreement.
Very truly yours,
Xxxxx Xxxxxxx,
Chief Accounting Officer
ACCEPTED AND AGREED:
________________________
CONVERTIBLE PROMISSORY NOTE
$_____.00 January 11, 0000
Xxxxxx, Xxxxxxxxxxxxx
FOR VALUE RECEIVED, NATIONAL DATACOMPUTER, INC., a Delaware corporation
with its principal place of business at 000 Xxxxxxxxx Xxxxxxxx, Xxxxxxxxx,
Xxxxxxxxxxxxx 0000 (the "Borrower") hereby promises to pay to the order of (NAME
OF LENDER (the "Lender"), in lawful money of the United States of America at the
office of the Lender at (ADDRESS OF LENDER) , or at such other place or places
or to such other party or parties as the Lender may from time to time designate,
the principal sum of ______ Thousand Dollars ($__,000.00). The Borrower shall
pay the entire principal balance of this Note in one payment on June 30, 2008.
Notwithstanding the foregoing, this Note shall automatically convert into
_________ shares of the Company's Common Stock upon approval of the Company's
stockholders of the transaction to allow officers and directors of the Company
purchase such shares (the "Shareholder Approval").
No interest shall accrue on this Note Interest except that in the event
the Shareholder Approval is not obtained on or before March 31, 2007, then
interest shall accrue on the then outstanding principal balance of this Note at
a fluctuating interest rate per annum equal to two percent (2% above the Prime
Rate (as defined below) from the date of issuance of this Note. In addition to
the payment of principal hereunder, all accrued interest then outstanding shall
be payable in arrears commencing on the last day of December 31, 2007 and at the
end of each calendar month thereafter until this Note is paid in full. "Prime
Rate" shall mean the rate of interest quoted as the Prime Rate in the Wall
Street Journal from time to time. Each change in such interest rate shall take
effect simultaneously with the corresponding change in such Prime Rate. Interest
shall be calculated on the basis of actual days elapsed and a 360-day year.
If any amount due under this Note is not paid in full within ten (10)
days of the due date, whether as stated or by acceleration, interest on the
unpaid principal balance shall continue to accrue and shall thereafter be
increased effective as of such due date to a rate per annum equal to five
percent (5%)% above the Prime Rate.
It is the intent of the Lender and of the Borrower that in no event
shall interest be payable at a rate in excess of the maximum rate permitted by
applicable law (the "Maximum Legal Rate"). Solely to the extent necessary to
prevent interest under this Note from exceeding the Maximum Legal Rate, any
amount that would be treated as excessive under a final judicial interpretation
of applicable law shall be deemed to have been a mistake and automatically
cancelled and, if received by the Lender, shall be applied to the principal
balance of this Note or, if no principal balance remains outstanding, then such
amount shall be refunded to the Borrower.
The Borrower may voluntarily prepay this Note in whole or in part at
any time and from time to time without penalty, together with interest accrued
on the amount prepaid through the date of prepayment.
Upon the occurrence of any one or more of the following events (each,
an "Event of Default"), the Lender at its option may declare all amounts due
hereunder, including, without limitation, the entire unpaid principal balance of
this Note and any accrued, unpaid interest thereon, to be immediately due and
payable without notice or protest (both of which are hereby waived):
(a) The failure to make any payment of principal or interest due
pursuant to the terms of this Note on or before the due date;
(b) The failure to promptly, punctually, and faithfully perform or
discharge any liability or obligation of the Borrower to the Lender;
(c) The determination by the Lender that any representation or warranty
now or hereafter made by the Borrower to the Lender in any document,
instrument, agreement, or paper was not true or accurate when given;
(d) (i) The commencement by the Borrower of a voluntary case under 11
U.S.C. Section 101 et. seq. (the "Bankruptcy Code") or any foreign,
federal or state bankruptcy, insolvency or other similar law now or
hereafter in effect, or (ii) the consent by the Borrower to the entry
of an order for relief in an involuntary bankruptcy or similar case, or
to the conversion of an involuntary case to a voluntary case, under any
such law, or (iii) the consent by the Borrower to the appointment of,
or the taking of possession by, a receiver, trustee or other custodian
for all or a substantial part of its properties, or (iv) the making by
the Borrower of any assignment for the benefit of creditors, or (v) the
admission by the Borrower in writing of its inability to pay its debts
as such debts become due, or (vi) the death, discontinuance of
business, dissolution, winding up, liquidation or cessation of
existence by the Borrower;
(e) (i) The entry by a court of a decree or order for relief with
respect to the Borrower in an involuntary case under the Bankruptcy
Code or any applicable foreign, federal or state bankruptcy, insolvency
or other similar law now or hereafter in effect, which decree or order
is not stayed or dismissed within 60 days of the entry thereof, or (ii)
the entry by a court of a decree or order for the appointment of a
receiver, liquidator, sequestrator, trustee, custodian or other person
having similar powers over the Borrower or over all or a substantial
part of its properties;
(f) A judgment, decree, writ, warrant of attachment or similar process
in an amount equal to or exceeding $100,000 is entered against the
Borrower or any of its assets, if such judgment, decree, writ, warrant
of attachment or similar process is not adequately covered by insurance
or has not been vacated, discharged, appealed from (with execution or
similar process continuously stayed) within fifteen (15) days of such
judgment's entry;
(g) The service of any process upon the Lender seeking to attach by
mesne or trustee process any funds of the Borrower on deposit with the
Lender;
(h) The occurrence of any event such that any indebtedness of the
Borrower equal to or exceeding $100,000 which is owed to a person or
entity other than the Lender could be accelerated, notwithstanding that
such acceleration has not taken place;
(i) The sale of all or substantially all of the assets of the Borrower,
or the sale of a fifty percent (50%) or greater beneficial interest in
the Corporation to any single person or entity or affiliates of such
entity as defined in the Securities Exchange Act of 1934, as amended;
or
(j) The occurrence of any event or circumstance with respect to the
Borrower such that the Lender deems itself to be insecure.
Upon the occurrence and continuance of any Event of Default hereunder,
(i) the Lender may declare the principal balance of this Note to be immediately
due and payable, provided, however, in the case of an Event of Default described
in paragraphs (d) or (e) above, all amounts payable by the Borrower hereunder,
including, without limitation, the principal balance and all accrued interest on
this Note, shall automatically become immediately due and payable, without
notice, action or election by the Lender, and (ii) the Lender may enforce any
other rights granted pursuant to this Note, any other document, or by applicable
law. All of the rights of the Lender hereunder shall be cumulative and not
exclusive, and each of which may be exercised singly, repetitively, in any
combination, and in any order. The Lender's rights and remedies hereunder may be
exercised without resort or regard to any other source of satisfaction of any
liabilities owing by the Borrower to the Lender. No inconsistency between the
default provisions of this Note and any other agreement shall be deemed to
create any additional notice, cure or grace period or derogate from the express
terms of such provisions.
Upon the occurrence of an Event of Default, the Borrower agrees to pay
on demand all out-of-pocket costs and expenses (including, without limitation,
reasonable attorneys' fees) incurred or paid by the holder(s) hereof in
collecting or enforcing this Note.
The Borrower hereby waives presentment, demand, protest or notice of
any kind in connection with this Note. No failure on the part of the Lender in
exercising any right
or remedy hereunder, and no single, partial or delayed exercise by the Lender of
any right or remedy shall preclude the full and timely exercise by the Lender at
any time of any right or remedy of the Lender hereunder without notice. No
course of dealing or other conduct, no oral agreement or representation made by
the Lender or usage of trade shall operate as a waiver of any right or remedy of
the Lender. This Note contains the entire agreement between the parties with
respect to the subject matter hereof, and supersedes every course of dealing,
other conduct, oral agreement or representation previously made by the Lender.
In the event that any court of competent jurisdiction shall determine that any
provision, or portion thereof, contained in this Note shall be unenforceable in
any respect, then such provision shall be deemed limited to the extent that such
court deems it enforceable, and the remaining provisions of this Note shall
nevertheless remain in full force and effect.
None of the terms or provisions of this Note may be excluded, modified,
or amended except by a written instrument duly executed on behalf of both the
Borrower and the Lender expressly referring hereto and setting forth the
provision so excluded, modified or amended. No waiver or forbearance of any of
the rights and remedies of the Lender hereunder shall be effective unless made
specifically in a writing signed by the Lender, and any such waiver or
forbearance shall be effective only in the specific instance and for the
specific purpose for which given.
This Note is a negotiable instrument and may be negotiated, sold,
assigned, discounted or conveyed at any time by the holder(s) hereof, without
notice to, or consent of, the Borrower.
This Note shall be binding upon the Borrower and shall be enforceable
against the Borrower and its successors and representatives, and shall inure to
the benefit of the Lender and its successors, endorsees and assigns. The
Borrower may not assign this Note or any rights hereunder without the express
written consent of the Lender. The Lender may assign this Note in whole or in
part, or may grant participations in this Note from time to time, without notice
to, or consent from, the Borrower.
THIS NOTE IS DELIVERED TO THE LENDER AT ITS PRINCIPAL OFFICE IN
BILLERICA, MASSACHUSETTS AND SHALL BE GOVERNED BY AND ENFORCED IN ACCORDANCE
WITH THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS WITHOUT REGARD TO ITS
PRINCIPLES OF CONFLICTS OF LAWS. THE BORROWER SUBMITS TO THE JURISDICTION OF THE
COURTS OF THE COMMONWEALTH OF MASSACHUSETTS AND OF THE UNITED STATES DISTRICT
COURTS SITUATED THEREIN FOR ALL PURPOSES WITH RESPECT TO THIS NOTE.
THE BORROWER HEREBY EXPRESSLY AND VOLUNTARILY WAIVES ALL RIGHTS TO
TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF, IN CONNECTION WITH, OR
RELATED TO THIS NOTE, INCLUDING, WITHOUT LIMITATION, IN CONNECTION WITH ANY
DEFENSE, AFFIRMATIVE DEFENSE, COUNTERCLAIM OR THE LIKE ASSERTED AGAINST THE
LENDER.
IN WITNESS WHEREOF, the Borrower has caused this Note to be executed as
an instrument under seal by its duly authorized officer as of the date first
above written.
Witness: NATIONAL DATACOMPUTER, INC.
_________________________ By: _______________________________
Name: (Signature)
_______________________________
(Print or type name)
its:_______________________________
(Title or Capacity)
