EXHIBIT A
THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO
AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH
APPLICABLE STATE SECURITIES LAWS OR BLUE SKY LAWS.
No. [ ] $[ ]
Date: March __, 2006
AMERICAN UNITED GLOBAL, INC.
NOTE
THIS NOTE is one of a series of duly authorized and issued Notes of
American United Global, Inc., a Delaware corporation (the "Company"), designated
as its Notes due the earlier of (i) March __, 2009 or (ii) the Company closing
on financing in the aggregate amount of $10,000,000, in the aggregate principal
amount of $1,235,000 (the "Notes").
FOR VALUE RECEIVED, the Company promises to pay to the order of
[Holder] or its registered assigns (the "Holder"), the principal sum of
[__________] $(__________), on the earlier of (i) March __, 2009 or (ii) the
date the Company closes on financing in the aggregate amount of $12,000,000 (the
"Financing") and the Holder provides the Company with notice of demand to be
repaid within 10 days of the closing of the Financing (the "Maturity Date"), or
such earlier date as the Notes are required or permitted to be repaid as
provided hereunder. No interest is payable in connection with the Notes.
Notwithstanding the foregoing, the Company hereby unconditionally promises to
pay to the order of the Holder interest on any principal payable hereunder that
shall not be paid in full when due, whether at the time of any stated maturity
or by prepayment, acceleration or declaration or otherwise, for the period from
and including the due date of such payment to but excluding the date the same is
paid in full, at a rate of 12% per annum (but in no event in excess of the
maximum rate permitted under applicable law).
Interest payable under this Note shall be computed on the basis of a
year of 360 days and actual days elapsed (including the first day but excluding
the last day) occurring in the period for which interest is payable.
Payments of principal and interest shall be made in lawful money of the
United States of America to the Holder at its address as provided in Section 14
or by wire transfer to such account specified from time to time by the Holder
hereof for such purpose as provided in Section 14.
The Holder of this Note is entitled to the benefits of the Security
Agreement.
1. Definitions. In addition to the terms defined elsewhere in this Note,
(a) capitalized terms that are not otherwise defined herein have the meanings
given to such terms in the Securities Purchase Agreement, dated as of March __,
2006, among the Company and the Purchasers identified therein (the "Purchase
Agreement"), and (b) the following terms have the meanings indicated:
"Original Issue Date" means the date of the first issuance of
any Notes, regardless of the number of transfers of any particular
Note.
2. Principal Payment upon Maturity. The Company must pay principal on this
Note in cash upon Maturity.
3. Registration of Notes. The Company shall register the Notes upon
records to be maintained by the Company for that purpose (the "Note Register")
in the name of each record holder thereof from time to time. The Company may
deem and treat the registered Holder of this Note as the absolute owner hereof
for the purpose of any conversion hereof or any payment of principal hereon, and
for all other purposes, absent actual notice to the contrary.
4. Registration of Transfers and Exchanges. The Company shall register the
transfer of any portion of this Note in the Note Register upon surrender of this
Note to the Company at its address for notice set forth herein. Upon any such
registration or transfer, a new Note, in substantially the form of this Note
(any such new Note, a "New Note"), evidencing the portion of this Note so
transferred shall be issued to the transferee and a New Note evidencing the
remaining portion of this Note not so transferred, if any, shall be issued to
the transferring Holder. The acceptance of the New Note by the transferee
thereof shall be deemed the acceptance by such transferee of all of the rights
and obligations of a holder of a Note. This Note is exchangeable for an equal
aggregate principal amount of Notes of different authorized denominations, as
requested by the Holder surrendering the same. No service charge or other fee
will be imposed in connection with any such registration of transfer or
exchange.
5. Events of Default.
(a) "Event of Default" means any one of the following events (whatever
the reason and whether it shall be voluntary or involuntary or effected by
operation of law or pursuant to any judgment, decree or order of any court, or
any order, rule or regulation of any administrative or governmental body):
(i) any default in the payment (free of any claim of
subordination) of principal or liquidated damages in respect of any
Notes, as and when the same becomes due and payable (whether on the
date on which the obligations under the Note mature or by acceleration,
redemption, prepayment or otherwise);
(ii) the Company or any Subsidiary defaults in any of its
obligations under any other note or any mortgage, credit agreement or
other facility, indenture agreement, factoring agreement or other
instrument under which there may be issued, or by which there may be
secured or evidenced, any indebtedness for borrowed money or money due
under any long term leasing or factoring arrangement of the Company or
any Subsidiary in an amount exceeding $1,000,000, whether such
indebtedness now exists or is hereafter created, and such default
results in such indebtedness becoming or being declared due and payable
prior to the date on which it would otherwise become due and payable;
or
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(iii) the occurrence of a Bankruptcy Event.
(b) At any time or times following the occurrence of an Event of
Default, the Holder may require the Company to repurchase all or any portion of
the outstanding principal amount of this Note, at a repurchase price equal to
the 115% of such outstanding principal amount.
6. Notices. Any and all notices or other communications or deliveries
hereunder (including any Conversion Notice) shall be in writing and shall be
deemed given and effective on the earliest of (i) the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile number
specified in this Section 6 prior to 6:30 p.m. (New York City time) on a Trading
Day, (ii) the next Trading Day after the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number specified in
this Section 12 on a day that is not a Trading Day or later than 6:30 p.m. (New
York City time) on any Trading Day, (iii) the Trading Day following the date of
mailing, if sent by nationally recognized overnight courier service, or (iv)
upon actual receipt by the party to whom such notice is required to be given.
The addresses for such communications shall be: (i) if to the Company, to 000
Xxxxxxx Xxxxxx - #000, Xxxxxx, XX 00000, facsimile: 000-000-0000, attention
Xxxxxx Xxxxx, CEO, or (ii) if to the Holder, to the address or facsimile number
appearing on the Company's Noteholder records or such other address or facsimile
number as the Holder may provide to the Company in accordance with this Section
9.
7. Miscellaneous.
(a) This Note shall be binding on and inure to the benefit of the
parties hereto and their respective successors and permitted assigns. The
Company shall not be permitted to assign this Note.
(b) Subject to Section 7(a), nothing in this Note shall be construed to
give to any person or corporation other than the Company and the Holder any
legal or equitable right, remedy or cause under this Note.
(C) GOVERNING LAW; VENUE; WAIVER OF JURY TRIAL. ALL QUESTIONS
CONCERNING THE CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS
NOTE SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE
INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE PRINCIPLES OF
CONFLICTS OF LAW THEREOF. EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE
JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF NEW YORK,
BOROUGH OF MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED
HEREIN (INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE TRANSACTION
DOCUMENTS), AND HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT IN ANY SUIT,
ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF ANY SUCH COURT, THAT SUCH SUIT, ACTION OR PROCEEDING IS
IMPROPER. EACH PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND
CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY
MAILING A COPY THEREOF VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY
(WITH EVIDENCE OF DELIVERY) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES
TO IT UNDER THIS AGREEMENT AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD
AND SUFFICIENT SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN
SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER
PERMITTED BY LAW. THE COMPANY HEREBY WAIVES ALL RIGHTS TO A TRIAL BY JURY.
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(d) The headings herein are for convenience only, do not constitute a
part of this Note and shall not be deemed to limit or affect any of the
provisions hereof.
(e) In case any one or more of the provisions of this Note shall be
invalid or unenforceable in any respect, the validity and enforceability of the
remaining terms and provisions of this Note shall not in any way be affected or
impaired thereby and the parties will attempt in good faith to agree upon a
valid and enforceable provision which shall be a commercially reasonable
substitute therefor, and upon so agreeing, shall incorporate such substitute
provision in this Note.
(f) In the event of any stock split, subdivision, dividend or
distribution payable in shares of Common Stock (or other securities or rights
convertible into, or entitling the holder thereof to receive directly or
indirectly shares of Common Stock), combination or other similar
recapitalization or event occurring after the date hereof, each reference in
this Note to a price shall be amended to appropriately account for such event.
(g) No provision of this Note may be waived or amended except in a
written instrument signed, in the case of an amendment, by the Company and the
Holder or, or, in the case of a waiver, by the Holder. No waiver of any default
with respect to any provision, condition or requirement of this Note shall be
deemed to be a continuing waiver in the future or a waiver of any subsequent
default or a waiver of any other provision, condition or requirement hereof, nor
shall any delay or omission of either party to exercise any right hereunder in
any manner impair the exercise of any such right.
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IN WITNESS WHEREOF, the Company has caused this Note to be duly
executed by a duly authorized officer as of the date first above indicated.
AMERICAN UNITED GLOBAL, INC.
By________________________________
Name:
Title:
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