EXECUTION COPY
Exhibit
4.2
EXECUTION
COPY
THIS
NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”), OR
APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD, TRANSFERRED, OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR RECEIPT BY THE COMPANY OF A
WRITTEN OPINION OF COUNSEL IN FORM, SUBSTANCE AND SCOPE REASONABLY SATISFACTORY
TO THE COMPANY THAT THIS NOTE MAY BE SOLD, TRANSFERRED, OR OTHERWISE
DISPOSED OF, UNDER AN EXEMPTION FROM REGISTRATION UNDER THE ACT AND SUCH STATE
SECURITIES LAWS.
10%
Bridge Note
Date:
December 30, 2010
$150,000.00
For value
received, JUMA TECHNOLOGY CORP., a Delaware corporation (the “Company”),
and NECTAR SERVICES CORP., a Delaware corporation (“Nectar”,
and together with the Company, the “Makers”),
hereby promise to pay to the order of Vision Opportunity Master Fund,
Ltd. (together with its successors, representatives, and permitted
assigns, the “Holder”),
in accordance with the terms hereinafter provided, the principal amount of one hundred fifty thousand
($150,000.00) dollars, together with interest thereon. The
Makers are issuing this 10% Bridge Note (the “Note”)
to the Holder pursuant to the Purchase Agreement (as defined in Section
1.1 hereof).
All
payments under or pursuant to this Note shall be made in United States Dollars
in immediately available funds to the Holder at the address of the Holder as set
forth in the Purchase Agreement or at such other place as the Holder may
designate from time to time in writing to the Makers or by wire transfer of
funds to the Holder’s account, instructions for which are attached hereto as
Exhibit
A. The outstanding principal balance and all accrued Interest (as
defined herein) of this Note shall be due and payable on the fifth day after
demand therefor (the “Maturity
Date”) or at such earlier time as provided herein.
ARTICLE
I
Section
1.1 Purchase
Agreement. This Note has been executed and delivered pursuant
to the Note and Warrant Purchase Agreement dated as of December 30, 2010 (the
“Purchase
Agreement”) by and among the Makers and the purchasers listed
therein. Capitalized terms used and not otherwise defined herein
shall have the meanings set forth for such terms in the Purchase
Agreement.
Section
1.2 Interest. Beginning
on the issuance date of this Note (the “Issuance
Date”), the outstanding principal balance of this Note shall bear
interest (“Interest”),
at a rate per annum equal to ten percent (10%), so long as any principal amount
evidenced by this Note remains outstanding. Interest shall be payable in cash,
on the Maturity Date. Interest shall be computed on the basis of a
360-day year of twelve (12) 30-day months and shall accrue commencing on the
Issuance Date. Furthermore, upon the occurrence of an Event of
Default (as defined in Section
2.1 hereof), then to the extent permitted by law, the Makers will pay
Interest in cash to the Holder, payable on demand, on the outstanding principal
balance of this Note from the date of the Event of Default through the date of
payment at a new rate of the lesser of twelve percent (12%) and the maximum
applicable legal rate per annum (the “Default
Rate”).
Section
1.3 Ranking and
Covenants.
(a) Other
than such indebtedness existing as of the Issuance Date, the Makers will not,
and will not permit any Subsidiary to, directly or indirectly, enter into,
create, incur, assume or suffer to exist any indebtedness of any kind, that is
senior in any respect to the Makers’ obligations under the Notes, and the Makers
will not, and will not permit any Subsidiary to, directly or indirectly, incur
any Lien on or with respect to any of its property or assets now owned or
hereafter acquired or any interest therein or any income or profits therefrom,
except for indebtedness with respect to capital leases incurred in the ordinary
course of business.
(b) So
long as any Notes are outstanding, none of the Makers nor any Subsidiary shall,
directly or indirectly, (i) redeem, purchase or otherwise acquire any of the
Company’s capital stock or set aside any monies for such a redemption, purchase
or other acquisition or (ii) issue any Options or Convertible Securities with an
exercise price or a conversion price or a number of underlying shares that
floats or resets or otherwise varies or is subject to adjustment based (directly
or indirectly) on market prices of the Common Stock.
Section
1.4 Payment on Non-Business
Days. Whenever any payment to be made shall be due on a
Saturday, Sunday or a public holiday under the laws of the State of New York,
such payment may be due on the next succeeding business day and such next
succeeding day shall be included in the calculation of the amount of accrued
Interest payable on such date.
Section
1.5 Transfer. This
Note may be transferred or sold, subject to the provisions of Section
4.8 of this Note, or pledged, hypothecated or otherwise granted as
security by the Holder.
Section
1.6 Replacement. Upon
receipt of a duly executed and notarized written statement from the Holder with
respect to the loss, theft or destruction of this Note (or any replacement
hereof) and a standard indemnity reasonably satisfactory to the Makers, or, in
the case of a mutilation of this Note, upon surrender and cancellation of such
Note, the Makers shall issue a new Note, of like tenor and amount, in lieu of
such lost, stolen, destroyed or mutilated Note.
ARTICLE
II
EVENTS OF DEFAULT;
REMEDIES
Section
2.1 Events of
Default. The occurrence of any of the following events shall
be an “Event of
Default” under this Note:
2
(a) the
Makers shall fail to make any principal or Interest payments due under this Note
on the date such payments are due and such default is not fully cured within ten
(10) business days after the occurrence thereof; or
(b) [Intentionally
omitted]; or
(c) the
suspension from listing, without subsequent listing on any one of, or the
failure of the Common Stock to be listed or quoted on at least one of the OTC
Bulletin Board, the American Stock Exchange, the NASDAQ Global Market, the
NASDAQ Capital Market or The New York Stock Exchange, Inc. for a period of ten
(10) consecutive Trading Days; or
(d) [Intentionally
omitted]; or
(e) either
(i) [Intentionally omitted], or (ii) the Makers shall fail to make the payment
of any fees and/or liquidated damages under this Note or the Purchase Agreement,
which failure is not remedied within ten (10) business days after the occurrence
thereof; or
(f)
[Intentionally omitted]; or
(g) default
shall be made in the performance or observance of (i) any covenant, condition or
agreement contained in this Note and such default is not fully cured within ten
(10) business days after the Holder delivers written notice to the Makers of the
occurrence thereof or (ii) any covenant, condition or agreement contained in the
Purchase Agreement, the Other Notes, the Warrants or any other Transaction
Document which is not covered by any other provisions of this Section
2.1 and such default is not fully cured within ten (10) business days
after the Holder delivers written notice to the Makers of the occurrence
thereof; or
(h) any
material representation or warranty made by either of the Makers herein or in
the Purchase Agreement, the Other Notes, the Warrants or any other Transaction
Document shall prove to have been false or incorrect or breached in a material
respect on the date as of which made and the Holder delivers written notice to
the Makers of the occurrence thereof; or
(i) either
of the Makers shall after the Issuance Date (A) default in any payment of any
amount or amounts of principal of or interest on any indebtedness (other than
the indebtedness hereunder) the aggregate principal amount of which indebtedness
is in excess of $100,000 or (B) default in the
observance or performance of any other agreement or condition relating to any
indebtedness or contained in any instrument or agreement evidencing, securing or
relating thereto, or any other event shall occur or condition exist, the effect
of which default or other event or condition is to cause, or to permit the
holder or holders or beneficiary or beneficiaries of such indebtedness to cause
with the giving of notice if required, such indebtedness to become due prior to
its stated maturity; or
3
(j) either
of the Makers shall (i) apply for or consent to the appointment of, or the
taking of possession by, a receiver, custodian, trustee or liquidator of itself
or of all or a substantial part of its property or assets, (ii) make a general
assignment for the benefit of its creditors, (iii) commence a voluntary case
under the United States Bankruptcy Code (as now or hereafter in effect) or under
the comparable laws of any jurisdiction (foreign or domestic), (iv) file a
petition seeking to take advantage of any bankruptcy, insolvency, moratorium,
reorganization or other similar law affecting the enforcement of creditors’
rights generally, (v) acquiesce in writing to any petition filed against it in
an involuntary case under United States Bankruptcy Code (as now or hereafter in
effect) or under the comparable laws of any jurisdiction (foreign or domestic),
or (vi) issue a notice of bankruptcy or winding down of its operations or issue
a press release regarding same; or
(k) a
proceeding or case shall be commenced in respect of either of the Makers,
without its application or consent, in any court of competent jurisdiction,
seeking (i) the liquidation, reorganization, moratorium, dissolution, winding
up, or composition or readjustment of its debts, (ii) the appointment of a
trustee, receiver, custodian, liquidator or the like of it or of all or any
substantial part of its assets in connection with its liquidation or dissolution
or (iii) similar relief in respect of it under any law providing for the relief
of debtors, and such proceeding or case described in clause (i), (ii) or (iii)
shall continue undismissed, or unstayed and in effect, for a period of thirty
(30) days or any order for relief shall be entered in an involuntary case under
United States Bankruptcy Code (as now or hereafter in effect) or under the
comparable laws of any jurisdiction (foreign or domestic) against either of the
Makers or action under the laws of any jurisdiction (foreign or domestic)
analogous to any of the foregoing shall be taken with respect to either of the
Makers and shall continue undismissed, or unstayed and in effect for a period of
thirty (30) days; or
(l) the
failure of the Company to instruct its transfer agent to remove any legends from
shares of Common Stock eligible to be sold under Rule 144 of the Securities Act
and issue such unlegended certificates to the Holder within five (5) business
days of the Holder’s request so long as the Holder has provided reasonable
assurances to the Company, and based thereon the Company has determined, that
such shares of Common Stock can be sold pursuant to Rule 144; or
(m) the
failure of either of the Makers to pay any other amounts due to the Holder
herein or any other Transaction Document within ten (10) business days of the
date such payments are due and such default is not fully cured within ten (10)
business days after the Holder delivers written notice to the Maker of the
occurrence thereof; or
(n) the
occurrence of an event of default under any other Transaction
Document.
Section
2.2 Remedies Upon An Event of
Default. If an Event of Default shall have occurred and shall
be continuing, the Holder of this Note may at any time at its option, (a)
declare the entire unpaid principal balance of this Note, together with all
Interest accrued hereon, due and payable, and thereupon, the same shall be
accelerated and so due and payable, without presentment, demand, protest, or
notice, all of which are hereby expressly unconditionally and irrevocably waived
by the Makers; provided,
however, that upon the occurrence of an Event of Default described in
Sections
2.1(j) or (k),
the outstanding principal balance and accrued Interest hereunder shall be
automatically due and payable, (b) [Intentionally omitted], or (c) exercise or
otherwise enforce any one or more of the Holder’s rights, powers, privileges,
remedies and interests under this Note, the Purchase Agreement or applicable
law. No course of delay on the part of the Holder shall operate as a
waiver thereof or otherwise prejudice the right of the Holder. No
remedy conferred hereby shall be exclusive of any other remedy referred to
herein or now or hereafter available at law, in equity, by statute or
otherwise.
4
ARTICLE
III
CONVERSION;
ANTIDILUTION; PREPAYMENT; COVENANTS
Section
3.1 [Intentionally
omitted].
Section
3.2 [Intentionally
omitted].
Section
3.3 [Intentionally
omitted].
Section
3.4 [Intentionally
omitted].
Section
3.5 [Intentionally
omitted].
Section
3.6 [Intentionally
omitted].
Section
3.7 Prepayment.
(a) Prepayment Upon an Event of
Default. Notwithstanding anything to the contrary contained
herein, upon the occurrence of an Event of Default described in Sections
2.1(b)-(i), (l),
(m)
and (n)
hereof, the Holder shall have the right, at the Holder’s option, to require the
Makers to prepay in cash all or a portion of this Note at a price equal to one
hundred percent (100%) of the aggregate principal amount of this Note plus all
accrued and unpaid Interest applicable at the time of such
request. Nothing in this Section
3.7(a) shall limit the Holder’s rights under Section
2.2 hereof.
(b) Prepayment Option Upon Major
Transaction. In addition to all other rights of the Holder
contained herein, simultaneous with the occurrence of a Major Transaction (as
defined below), the Holder shall have the right, at the Holder’s option, to
require the Makers to prepay in cash all or a portion of this Note at a price
equal to one hundred twenty percent (120%) of the aggregate principal amount of
this Note plus all accrued and unpaid Interest (the “Major
Transaction Prepayment Price”).
(c) Prepayment Option Upon
Triggering Event. In addition to all other rights of the
Holder contained herein, after a Triggering Event (as defined below), the Holder
shall have the right, at the Holder’s option, to require the Makers to prepay
all or a portion of this Note in cash at a price equal to one hundred twenty
percent (120%) of the aggregate principal amount of this Note plus all accrued
and unpaid Interest (the “Triggering
Event Prepayment Price,” and, collectively with the Major Transaction
Prepayment Price, the “Prepayment
Price”).
5
(d) Optional Prepayment by
Company. In addition to all other rights of the Company
contained herein, at any time after three (3) months from the Issuance Date, the
Company shall have the right, solely at the Company’s option, to prepay in cash
(the “Optional
Prepayment”) at a price equal to one hundred ten percent (110%) of the
aggregate principal amount of this Note plus all accrued and unpaid Interest, if
any, thereon to the date of such Optional Prepayment (the “Optional
Company Prepayment Price”) by providing written notice of at least thirty
(30) calendar days prior to the consummation of the Optional Prepayment via
facsimile and overnight courier (“Notice of
Optional Prepayment”) to the Holder of this Note and the Other Holders.
The Company may pay, upon an Optional Prepayment, all accrued and unpaid
Interest, if any, by issuing the Holders additional Notes with a principal
amount equal to the Interest then due and payable (a “PIK
Note”). The Company shall deliver the applicable Optional Company
Prepayment Price to the Holder, within five (5) business days after the date
specified in the Notice of Optional Prepayment for the Optional
Prepayment. If the Company shall fail to prepay the Notes (other than
pursuant to a dispute as to the arithmetic calculation of the Optional Company
Prepayment Price), in addition to any remedy such Holder of the Notes may have
under this Note and the Purchase Agreement, the Optional Company Prepayment
Price payable in respect of such Notes not prepaid shall bear interest at the
Default Rate until paid in full.
(e) “Major
Transaction.” A “Major
Transaction” shall be deemed to have occurred at such time as any of the
following events have occurred:
(i) the
consolidation, merger or other business combination of the Company with or into
another Person (as defined in Section
4.13 hereof) (other than (A) pursuant to a migratory merger effected
solely for the purpose of changing the jurisdiction of incorporation of the
Company or (B) a consolidation, merger or other business combination 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
(ii) the
sale or transfer of more than fifty percent (50%) of the Company’s assets (based
on the fair market value as determined in good faith by the Board) other than
inventory in the ordinary course of business in one or a related series of
transactions; or
(iii) closing
of a purchase, tender or exchange offer made to the holders of more than fifty
percent (50%) of the outstanding shares of Common Stock in which more than fifty
percent (50%) of the outstanding shares of Common Stock were tendered and
accepted; or
(iv) a
change in more than fifty percent (50%) of the current members of the Company’s
Board of Directors as of the Issuance Date, except for such changes approved by
the Holder of this Note.
(f) “Triggering
Event.” A “Triggering
Event” shall be deemed to have occurred at such time as any of the
following events:
(i) [Intentionally
omitted];
(ii) the
suspension from listing, without subsequent listing on any one of, or the
failure of the Common Stock to be listed on at least one of the OTC Bulletin
Board, the American Stock Exchange, the NASDAQ Global Market, the NASDAQ Capital
Market or The New York Stock Exchange, Inc., for a period of ten (10)
consecutive Trading Days;
6
(iii) [Intentionally
omitted]; or
(iv) [Intentionally
omitted]; or
(v)
the Company deregisters its shares of Common Stock and as a result such shares
of Common Stock are no longer publicly traded; or
(vi) the
Company consummates a “going private” transaction and as a result the Common
Stock is no longer registered under Sections 12(b) or 12(g) of the Exchange Act;
or
(vii) either
of the Makers breach any representation, warranty, covenant or other term or
condition of the Purchase Agreement, this Note or any other agreement, document,
certificate or other instrument delivered in connection with the transactions
contemplated thereby or hereby, except to the extent that such breach would not
have a Material Adverse Effect (as defined in the Purchase Agreement) and
except, in the case of a breach of a covenant which is curable, only if such
breach continues for a period of a least twenty (20) business days.
(g) [Intentionally
omitted].
(h) Mechanics of Prepayment at
Option of Holder Upon Major Transaction. No sooner than
fifteen (15) days nor later than ten (10) days prior to the consummation of a
Major Transaction, but in no event prior to the public announcement
of such Major Transaction, the Makers shall deliver written notice thereof via
facsimile and overnight courier (“Notice of
Major Transaction”) to the Holder of this Note and the Other
Holders. At any time after receipt of a Notice of Major Transaction
(or, in the event a Notice of Major Transaction is not delivered at least ten
(10) days prior to a Major Transaction, at any time during the ten (10) day
period prior to a Major Transaction), the Holder of this Note and the Other
Holders of the Other Notes then outstanding may require the Makers to prepay,
effective immediately prior to the consummation of such Major Transaction, all
or any portion of this Note then outstanding by delivering written notice
thereof via facsimile and overnight courier (“Notice of
Prepayment at Option of Holder Upon Major Transaction”) to the Makers,
which Notice of Prepayment at Option of Holder Upon Major Transaction shall
indicate (i) the principal amount of this Note that the Holder is electing to
have prepaid and (ii) the applicable Major Transaction Prepayment Price, as
calculated pursuant to Section
3.7(b) above.
(i) Mechanics of Prepayment at
Option of Holder Upon Triggering Event. Within three (3)
business days after the occurrence of a Triggering Event, the Makers shall
deliver written notice thereof via facsimile and overnight courier (“Notice of
Triggering Event”) to the Holder and the Other Holders. At any
time after the earlier of the Holder’s receipt of a Notice of Triggering Event
and the Holder becoming aware of a Triggering Event, the Holder of
this Note and the Other Holders of the Other Notes then outstanding may require
the Makers to prepay all or any portion of this Note then outstanding by
delivering written notice thereof via facsimile and overnight courier (“Notice of
Prepayment at Option of Holder Upon Triggering Event”) to the Makers,
which Notice of Prepayment at Option of Holder Upon Triggering Event shall
indicate (i) the amount of the Note that the Holder is electing to have prepaid
and (ii) the applicable Triggering Event Prepayment Price, as calculated
pursuant to Section
3.7(c) above. The Holder shall only be permitted to require
the Makers to prepay this Note pursuant to Section
3.7 hereof for the greater of a period of ten (10) days after receipt by
the Holder of a Notice of Triggering Event or for so long as such Triggering
Event is continuing.
7
(j) Payment of Prepayment
Price. Upon the Makers’ receipt of a Notice(s) of Prepayment
at Option of Holder Upon Triggering Event or a Notice(s) of Prepayment at Option
of Holder Upon Major Transaction from the Holder or the Other Holders, the
Makers shall notify the Holder or such Other Holders, as the case may be, by
facsimile of the Makers’ receipt of such Notice(s) of Prepayment at Option of
Holder Upon Triggering Event or Notice(s) of Prepayment at Option of Holder Upon
Major Transaction within two (2) business days of the Makers’ receipt of the
same and the Holder and each Other Holder which has sent such a notice shall
promptly thereafter submit to the Makers this Note (or certificates representing
a portion of this Note if the Holder elects not to have all of the outstanding
principal and accrued Interest hereunder prepaid) or the Other Notes
(or certificates representing a portion of the Other Notes if the Other Holders
elect not to have all of the outstanding principal and accrued Interest
thereunder prepaid) which the Holder or Other Holders, as the case may be, have
elected to have prepaid. The Makers shall deliver the applicable
Triggering Event Prepayment Price to the Holder, within five (5) business days
after the Makers’ receipt of this Note or the certificates related thereto, as
the case may be, and, in the case of a prepayment pursuant to Section
3.7(h), the Makers shall deliver the applicable Major Transaction
Prepayment Price immediately prior to the consummation of the Major Transaction;
provided that the
Holder’s original Note or the Other Holders’ original Other Notes, or the
certificates related thereto, shall have been so delivered to the Makers; provided further that if the Makers
are unable to prepay all of the Notes to be prepaid, the Makers shall prepay an
amount to the Holder and each Other Holder of this Note and the Other Notes
being prepaid equal to such holder’s pro-rata amount of all Notes
being prepaid. If the Makers shall fail to prepay all of the Notes
submitted for prepayment (other than pursuant to a dispute as to the arithmetic
calculation of the Prepayment Price), in addition to any remedy such holder of
the Notes may have under this Note and the Purchase Agreement, the applicable
Prepayment Price payable in respect of such Notes not prepaid shall bear
interest at the Default Rate until paid in full. Until the Makers pay
such unpaid applicable Prepayment Price in full to a holder of the Notes
submitted for prepayment, such holder shall have the option (the “Void
Optional Prepayment Option”) to, in lieu of prepayment, require the
Makers to promptly return to such holder(s) all of the Notes that were submitted
for prepayment by such holder(s) under this Section
3.7 and for which the applicable Prepayment Price has not been paid, by
sending written notice thereof to the Makers via facsimile (the “Void
Optional Prepayment Notice”). Upon the Makers’ receipt of such
Void Optional Prepayment Notice(s) and prior to payment of the full applicable
Prepayment Price to such holder, (i) the Notice(s) of Prepayment at Option of
Holder Upon Triggering Event or the Notice(s) of Prepayment at Option of Holder
Upon Major Transaction, as the case may be, shall be null and void ab initio with respect to
those Notes submitted for prepayment and for which the applicable Prepayment
Price has not been paid, (ii) the Makers shall immediately return any such Notes
submitted to the Makers by each holder for prepayment under this Section
3.7(j) and for which the applicable Prepayment Price has not been paid
and (iii) [Intentionally omitted].
8
Section
3.8 [Intentionally
omitted].
Section
3.9 [Intentionally
omitted].
ARTICLE
IV
MISCELLANEOUS
Section
4.1 Notices. Any
notice, demand, request, waiver or other communication required or permitted to
be given hereunder shall be in writing and shall be effective (a) upon hand
delivery or facsimile at the address or number designated in the Purchase
Agreement (if delivered on a business day during normal business hours where
such notice is to be received), or the first business day following such
delivery (if delivered other than on a business day during normal business hours
where such notice is to be received) or (b) on the second business day following
the date of mailing by express courier service, fully prepaid, addressed to such
address, or upon actual receipt of such mailing, whichever shall first
occur. The Makers will give written notice to the Holder at least ten
(10) days prior to the date on which the Company takes a record (x) with respect
to any dividend or distribution upon the Common Stock, (y) with respect to any
pro rata subscription offer to holders of Common Stock or (z) for determining
rights to vote with respect to any Organic Change, dissolution, liquidation or
winding-up but in no event shall such notice be provided to the Holder prior to
such information being made known to the public. The Makers will also
give written notice to the Holder at least ten (10) days prior to the date on
which any Organic Change, dissolution, liquidation or winding-up will take place
but in no event shall such notice be provided to the Holder prior to such
information being made known to the public. The Makers shall promptly notify the
Holder of any notices sent or received, or any actions taken with respect to the
Other Notes.
Section
4.2 Governing Law; Consent to
Jurisdiction. The parties acknowledge and agree that any claim,
controversy, dispute or action relating in any way to this agreement or the
subject matter of this agreement shall be governed solely by the laws of the
State of New York, without regard to any conflict of laws
doctrines. The parties irrevocably consent to being served with legal
process issued from the state and federal courts located in New York and
irrevocably consent to the exclusive personal jurisdiction of the federal and
state courts situated in the State of New York. The parties
irrevocably waive any objections to the personal jurisdiction of these
courts. Said courts shall have sole and exclusive jurisdiction over
any and all claims, controversies, disputes and actions which in any way relate
to this agreement or the subject matter of this agreement. The
parties also irrevocably waive any objections that these courts constitute an
oppressive, unfair, or inconvenient forum and agree not to seek to change venue
on these grounds or any other grounds. Nothing in this Section
4.2 shall affect or limit any right to serve process in any other manner
permitted by law.
Section
4.3 Headings. Article
and section headings in this Note are included herein for purposes of
convenience of reference only and shall not constitute a part of this Note for
any other purpose.
9
Section
4.4 Remedies, Characterizations,
Other Obligations, Breaches and Injunctive Relief. The
remedies provided in this Note shall be cumulative and in addition to all other
remedies available under this Note, at law or in equity (including, without
limitation, a decree of specific performance and/or other injunctive relief), no
remedy contained herein shall be deemed a waiver of compliance with the
provisions giving rise to such remedy and nothing herein shall limit a Holder’s
right to pursue actual damages for any failure by the Makers to comply with the
terms of this Note. Amounts set forth or provided for herein with
respect to payments, [Intentionally omitted] and the like (and the computation
thereof) shall be the amounts to be received by the Holder hereof and shall not,
except as expressly provided herein, be subject to any other obligation of the
Makers (or the performance thereof). Each of the Makers acknowledges that a
breach by it of its obligations hereunder will cause irreparable and material
harm to the Holder and that the remedy at law for any such breach may be
inadequate. Therefore each Maker agrees that, in the event of any such breach or
threatened breach, the Holder shall be entitled, in addition to all other
available rights and remedies, at law or in equity, to seek and obtain such
equitable relief, including but not limited to an injunction restraining any
such breach or threatened breach, without the necessity of showing economic loss
and without any bond or other security being required.
Section
4.5 Enforcement
Expenses. The Makers agree to pay all costs and expenses of
the Holder incurred as a result of enforcement of this Note, including, without
limitation, reasonable attorneys’ fees and expenses.
Section
4.6 Binding
Effect. The obligations of the Makers and the Holder set forth
herein shall be binding upon the successors and assigns of each such party,
whether or not such successors or assigns are permitted by the terms
hereof.
Section
4.7 Amendments. This
Note may not be modified or amended in any manner except in writing executed by
the Makers and the Holder.
Section
4.8 Compliance with Securities
Laws. The Holder of this Note acknowledges that this Note is
being acquired solely for the Holder’s own account and not as a nominee for any
other party, and for investment, and that the Holder shall not offer, sell or
otherwise dispose of this Note. This Note and any Note issued in
substitution or replacement therefor shall be stamped or imprinted with a legend
in substantially the following form:
“THIS
NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”), OR
APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD, TRANSFERRED, OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR RECEIPT BY THE COMPANY OF A
WRITTEN OPINION OF COUNSEL IN FORM, SUBSTANCE AND SCOPE REASONABLY SATISFACTORY
TO THE COMPANY THAT THIS NOTE MAY BE SOLD, TRANSFERRED, OR OTHERWISE
DISPOSED OF, UNDER AN EXEMPTION FROM REGISTRATION UNDER THE ACT AND SUCH STATE
SECURITIES LAWS.”
10
Section
4.9 [Intentionally
omitted].
Section
4.10 Parties in
Interest. This Note shall be binding upon, inure to the
benefit of and be enforceable by the Makers, the Holder and their respective
successors and permitted assigns.
Section
4.11 Failure or Indulgence Not
Waiver. No failure or delay on the part of the Holder in the
exercise of any power, right or privilege hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such power, right or
privilege preclude other or further exercise thereof or of any other right,
power or privilege, nor shall any waiver by the Holder of any such right or
rights on any one occasion be deemed a waiver of the same right or rights on any
future occasion.
Section
4.12 Makers’
Waivers.
(a) Except
as otherwise specifically provided herein, the Makers and all others that may
become liable for all or any part of the obligations evidenced by this Note,
hereby waive presentment, demand, notice of nonpayment, protest and all other
demands’ and notices in connection with the delivery, acceptance, performance
and enforcement of this Note, and do hereby consent to any number of renewals of
extensions of the time or payment hereof and agree that any such renewals or
extensions may be made without notice to any such persons and without affecting
their liability herein and do further consent to the release of any person
liable hereon, all without affecting the liability of the other persons, firms
or Makers liable for the payment of this Note, AND DO HEREBY WAIVE TRIAL BY
JURY.
(b) THE
MAKERS ACKNOWLEDGE THAT THE TRANSACTION OF WHICH THIS NOTE IS A PART IS A
COMMERCIAL TRANSACTION, AND TO THE EXTENT ALLOWED BY APPLICABLE LAW, HEREBY
WAIVES ITS RIGHT TO NOTICE AND HEARING WITH RESPECT TO ANY PREJUDGMENT REMEDY
WHICH THE HOLDER OR ITS SUCCESSORS OR ASSIGNS MAY DESIRE TO USE.
Section
4.13 Definitions. For
the purposes hereof, the following terms shall have the following
meanings:
“Convertible
Securities” means any convertible securities, warrants, options or other
rights to subscribe for or to purchase or exchange for, shares of Common Stock
or Common Stock Equivalents.
“Options”
shall mean any rights, warrants or options to subscribe for or purchase Common
Stock or Convertible Securities of the Company.
“Person”
means an individual or a corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability company, joint
stock company, government (or an agency or political subdivision thereof) or
other entity of any kind.
11
“Trading
Day” means (a) a day on which the Common Stock is traded on the OTC
Bulletin Board, or (b) if the Common Stock is not traded on the OTC Bulletin
Board, a day on which the Common Stock is quoted in the over-the-counter market
as reported by the National Quotation Bureau Incorporated (or any similar
organization or agency succeeding its functions of reporting prices); provided, however, that in
the event that the Common Stock is not listed or quoted as set forth in (a) or
(b) hereof, then Trading Day shall mean any day except Saturday, Sunday and any
day which shall be a legal holiday or a day on which banking institutions in the
State of New York are authorized or required by law or other government action
to close.
[remainder of page intentionally left
blank]
12
IN
WITNESS WHEREOF, the Makers have caused this Note to be duly executed as of the
Issuance Date set out above.
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By:
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Name:
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Title:
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NECTAR
SERVICES CORP.
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By:
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Name:
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Title:
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13
EXHIBIT
A
WIRE
INSTRUCTIONS
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Payee:
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Bank:
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Address:
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Bank
No.:
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Account
No.:
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Account Name:
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14
