EXHIBIT 4(c)
NEITHER THIS NOTE NOR THE SECURITIES WHICH MAY BE ISSUED UPON CONVERSION OF THIS
NOTE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
APPLICABLE STATE SECURITIES LAWS, BY REASON OF SPECIFIC EXEMPTIONS THEREUNDER
AND CANNOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF TO ANY PERSON OR ENTITY
UNLESS SUBSEQUENTLY REGISTERED THEREUNDER OR UNLESS APPLICABLE EXEMPTIONS
THEREFROM ARE AVAILABLE.
NATIONAL TRANSACTION NETWORK, INC.
CONVERTIBLE SUBORDINATED NOTE DUE 2002
$400,000 September 19, 1997
For value received, National Transaction Network, Inc., a Delaware
corporation (the "Company"), hereby promises to pay to International Verifact
Inc. or registered assigns (hereinafter referred to as the "Payee"), on or
before September 18, 2002 (the "Due Date") the principal sum of Four Hundred
Thousand dollars ($400,000) or such part thereof as then remains unpaid and to
pay accrued and unpaid interest from the date hereof on the whole amount of said
principal sum remaining at the end of each quarter unpaid at a rate equal to The
First National Bank of Boston's best prime rate, as announced at the end of each
calendar quarter, plus (i) 2% or (ii) 5% during any period which the Company is
in default of its covenants in respect of its working capital line of credit
with Silicon Valley Bank, in each case calculated and compounded on the last day
of each quarter, such interest to be payable together with the payment of the
principal of this Note. Principal and interest shall be payable in lawful money
of the United States of America at the principal office of the Payee or at such
other place as the legal holder may designate from time to time in writing to
the Company. Interest shall be computed on the basis of a 360-day year and a
90-day calendar quarter.
This Note is issued pursuant to and is entitled to the benefits of a
certain Convertible Subordinated Note Purchase Agreement, dated as of August 18,
1997, between the Company and International Verifact Inc. (as the same may be
amended from time to time, hereinafter referred to as the "Agreement"), and each
holder of this Note, by his acceptance hereof, agrees to be bound by the
provisions of the Agreement, including, without limitation, that: (i) the
principal of and interest on this Note is subordinated to Senior Debt, as
defined in the Agreement, (ii) in case of an Event of Default, as defined in the
Agreement, the principal of this Note may become or may be declared due and
payable in the manner and with the effect provided in the Agreement and (iii)
this Note is convertible at the option of the holder hereof into shares of
Common Stock of the Company in the manner set forth in this Agreement.
This Note is secured by and entitled to the benefits of a certain
Security Agreement (as that term is defined in the Agreement), dated September
19, 1997, from the Company to International Verifact Inc.
In case any payment herein provided for shall not be paid when due, the
Company promises to pay all cost of collection, including all reasonable
attorney's fees.
This Note shall be governed by, and construed in accordance with, the
laws of the Commonwealth of Massachusetts.
The Company and all endorsers and guarantors of this Note herein waive
presentment, demand, notice of nonpayment, protest and all other demands and
notices in connection with the delivery, acceptance, performance or enforcement
of this Note.
NATIONAL TRANSACTION NETWORK, INC.
By: /s/ Xxxxxx X. Xxxxxx
----------------------------
Xxxxxx X. Xxxxxx
Vice President, Finance & Administration
