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EXHIBIT 6.31
CONVERTIBLE PROMISSORY NOTE
$__________ March __, 2000
FOR VALUE RECEIVED, the undersigned, XXXXX.XXX, a Florida corporation
(hereinafter referred to as the "Maker"), hereby unconditionally promises to pay
to the order of _____________________________ (hereinafter referred to as the
"Holder"), at Holder's address at _______________________, or, upon notice from
Holder, to the person so designated in said notice to Maker, the principal sum
of ______________________________________ DOLLARS AND NO/100 ($__________), or
so much thereof as may be advanced and outstanding hereunder, together with
interest on the outstanding principal balance from day to day remaining, payable
in lawful money of the United States of America as set forth herein.
1. Interest. This Note shall bear interest on the unpaid principal balance
hereof until paid in full at the rate of TEN PERCENT (10%) per annum. Interest
on the indebtedness evidenced by this Note shall be computed on the basis of a
year of 365 or 366 days, as the case may be, and charged for the actual number
of days elapsed.
2. Advances. Subject to the terms and conditions of this Note, and provided
that no Event of Default (as defined in Section 4.1) has occurred and is
continuing, Xxxxxx agrees to make, or cause to be made, a loan to the Maker in a
principal amount up to but not exceeding Seven Hundred Three Thousand Four
Hundred Twenty-five Dollars and No/100 ($703,425.00), in one or more advances as
requested by Maker upon notice in writing delivered to Holder at least five (5)
business days prior to the date on which such advance is to be made. No requests
for advances may be made after September 1, 2000. All advances shall be made on
a pro rata basis among Holder and the holders of those certain Convertible
Promissory Notes of even date herewith payable to ________________________ and
_________________, Subject to the terms and conditions of this Note, and
provided that no Event of Default has occurred and is continuing, advances
hereunder shall be made available to the Maker by depositing the same, in
immediately available funds, in an account of the Maker designated by the Maker.
3. Payments. All principal and interest on this Note shall be due and
payable on the earlier to occur of (i) September __, 2000 or (ii) the date of
closing of the next equity or quasi-equity financing for the Maker, or any of
its subsidiaries. The earlier of such dates is herein referred to as the
"Payment Date." All amounts past due and outstanding on this Note from and after
the Payment Date shall accrue interest at an interest rate equal to the lesser
of fifteen percent (15%) or the maximum lawful rate until paid in full. This
Note may not be prepaid.
4. Default
4.1 Events of Default. Maker shall be in default hereunder upon the
happening of any of the following events or conditions (each such event or
condition hereinafter referred to as an "Event of Default"):
(a) Maker shall fail to pay when due the principal or interest of
this Note.
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(b) Maker shall commence a voluntary proceeding seeking
liquidation, reorganization, or other relief with respect to itself or
its debts under any bankruptcy, insolvency, or other similar law now
or hereafter in effect, or seeking the appointment of a trustee,
receiver, liquidator, custodian, or other similar official for it or a
substantial part of its property or shall consent to any such relief
or to the appointment of or taking possession by any such official in
an involuntary case or other proceeding commenced against it or shall
make a general assignment for the benefit of creditors or shall
generally fail to pay its debts as they become due or shall take any
corporate action to authorize any of the foregoing.
(c) Any involuntary proceeding shall be commenced against Maker
seeking liquidation, reorganization, or other relief with respect to
it or its debts under any bankruptcy, insolvency, or other similar law
now or hereafter in effect, or seeking the appointment of a trustee,
receiver, liquidator, custodian, or other similar official for it or a
substantial part of its property, and such involuntary proceeding
shall remain undismissed and unstayed for a period of ninety (90)
days.
(d) This Note shall cease to be in full force and effect or shall
be declared null and void or the validity or enforceability hereof
shall be contested or challenged by Maker, or Maker shall deny that it
has any further liability or obligation under this Note.
5. Remedies. Upon the occurrence of any Event of Default, Holder may, at
its option, declare the entire unpaid principal of and accrued interest on this
Note immediately due and payable without notice, demand or presentment, all of
which are hereby waived, and upon such declaration, the same shall become and
shall be immediately due and payable, and Holder shall have the right to
foreclose or otherwise enforce all liens or security interests securing payment
hereof, or any part hereof, and offset against this Note any sum or sums owed by
Holder hereof to Maker. Failure of Holder to exercise this option shall not
constitute a waiver of the right to exercise the same upon the occurrence of a
subsequent Event of Default.
6. Costs and Expenses. If this Note is placed in the hands of an attorney
for collection, or for the recovery or protection of this indebtedness, or if
Holder incurs any costs incident to the collection of the indebtedness evidenced
hereby after the occurrence of an Event of Default or the enforcement or
protection of the security, Maker and any endorsers hereof will be liable for,
without notice or demand, all costs and expenses arising therefrom, to include
reasonable attorney's fees plus all costs of court and litigation and the
reasonable costs of any other collection efforts.
7. Waivers. Maker and each surety, guarantor, endorser, and other party
ever liable for payment of any sums of money payable on this Note jointly and
severally waive notice, presentment, demand for payment, protest, notice of
protest and non-payment or dishonor, notice of acceleration, notice of intent to
accelerate, notice of intent to demand, diligence in collecting, grace, and all
other formalities of any kind, and consent to all extensions without notice for
any period or periods of time and partial payments, before or after maturity,
and any impairment of any collateral securing this Note, all without prejudice
to Holder. Holder shall similarly have the right to deal in any way, at any
time, with one or more of the foregoing parties without notice to any other
party, and to grant any such party any extensions of time for payment of any of
said indebtedness, or to release or substitute part or all
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of the collateral securing this Note, or to grant any other indulgences or
forbearances whatsoever, without notice to any other party and without in any
way affecting the personal liability of any party hereunder.
8. Maximum Interest Rate. If the laws of the State of Illinois or the
United States of America are now or ever revised, repealed, or judicially
interpreted, so as to render usurious any amount called for under this Note, or
contracted for, charged, taken, reserved, received, or paid, with respect to the
loan or forbearance evidenced by this Note, or if any prepayment by Maker or
other party, or computations of any sort, result in Maker or any other party to
this instrument having paid, been charged, or contracted for any interest in
excess of that permitted by law, then it is the express intent of Maker, Holder,
and any other party to this instrument that all excess amounts contracted for,
collected, charged, received, or taken by Xxxxxx or paid by Maker or any other
party be credited on the principal balance of this Note (or if this Note has
been paid in full, refunded to Maker or to whomever else may be so entitled),
and the provisions of this Note be deemed reformed and the amounts thereafter
collectable hereunder reduced, without the necessity of the execution of any new
document, so as to comply with the then applicable law, but so as to permit the
recovery of the fullest amount otherwise called for hereunder. It is expressly
stipulated and agreed to be the intent of Maker and Holder and other parties to
this instrument to at all times comply with the applicable usury laws of
Illinois and of the United States now or hereafter governing the interest paid
on this Note and the loan or forbearance evidenced hereby.
9. Governing Law; Venue. This Note shall be governed by and construed in
accordance with the laws of the State of Illinois and the applicable laws of the
United States of America. Any action or proceeding under or in connection with
this Note against Maker or any other party ever liable for payment of any sums
of money payable on this Note shall be brought in any state or federal court in
Cook County, Illinois. Maker and each such other party hereby irrevocably (i)
submits to the exclusive jurisdiction of such courts, and (ii) waives any
objection it may now or hereafter have as to the venue of any such action or
proceeding brought in such court or that such court is an inconvenient forum.
Any action or proceeding by Maker or any other party liable hereunder against
Xxxxxx shall be brought only in a court located in Cook County, Illinois.
10. Entire Agreement. THIS NOTE EMBODIES THE FINAL, ENTIRE AGREEMENT OF
MAKER AND HOLDER WITH RESPECT TO THE INDEBTEDNESS EVIDENCED BY THIS NOTE AND
SUPERSEDES ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS AND
UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THE INDEBTEDNESS EVIDENCED
BY THIS NOTE AND MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF MAKER AND
HOLDER. THERE ARE NO ORAL AGREEMENTS BETWEEN MAKER AND HOLDER RELATING TO THE
INDEBTEDNESS EVIDENCED BY THIS NOTE.
11. Automatic Conversion.
11.1 Automatic Conversion and Conversion Price.
The outstanding principal and interest of this Note shall
automatically convert, without any action on the part of the Holder, on the
closing of the offering and sale by Maker of shares
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of the preferred stock, par value $.01 per share (the "Preferred Stock"), of the
Corporation in which Maker receives gross proceeds (excluding the conversion of
this Note) of $5,000,000 or more (the "Conversion Date") into such fully paid
and non-assessable shares of Preferred Stock (calculated to the nearest 1/100th
of a share), having the same powers, designations, preferences, and relative
participating, optional or other special rights, and the qualifications,
limitations or restrictions thereof, as the Preferred Stock sold in such private
sale, at the conversion price (the "Conversion Price") equal to the lowest price
per share of Preferred Stock received by Maker in such private sale. In
addition, Holder shall be granted such additional rights and benefits as those
granted to the other purchasers in such private sale. Maker shall furnish to
Holder all such documentation as Holder may reasonably request to verify the
Conversion Price and other terms of such private sale. The number of shares of
Preferred Stock issuable upon conversion of this Note shall be determined as
follows: divide (A) the sum of (i) the principal of this Note outstanding on the
Conversion Date, plus (ii) all accrued and unpaid interest on this Note on the
Conversion Date, by (B) the Conversion Price.
11.2 Issuance of Shares of Preferred Stock on Conversion.
(a) As promptly as practicable after the Conversion Date, Maker
shall issue, at its expense, and shall deliver to such Holder, (i) a certificate
or certificates for the number of full shares of Preferred Stock issuable upon
the conversion of this Note, and (ii) cash in lieu of scrip as provided in
Section 11.4.
(b) Such conversion shall be deemed to have been effected
immediately prior to the close of business on the Conversion Date, and at such
time the rights of the Holder shall cease and the person or persons in whose
name or names any certificate or certificates for shares of Preferred Stock
shall be issuable upon such conversion shall be deemed to have become the holder
or holders of record of the shares represented thereby.
11.3 No Adjustments for Dividends.
No payment or adjustment shall be made by or on behalf of Maker on
account of any dividends on the Preferred Stock issued upon such conversion
which were declared for payment to holders of Preferred Stock of record as
of a date prior to the Conversion Date.
11.4 Cash Payment in Lieu of Fractional Shares.
No fractional shares of Preferred Stock shall be issued upon the
conversion of this Note. In lieu of any fraction of a share of Preferred
Stock to which the Holder would otherwise be entitled upon conversion of
this Note, Maker shall pay a cash adjustment for such fraction in an amount
equal to the same fraction of the Conversion Price per share of Preferred
Stock at the close of business on the Conversion Date.
IN WITNESS WHEREOF, Xxxxx has duly executed this Note as of the day and
year above first written.
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XXXXX.XXX, INC.,
a Florida corporation
By:
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Xxxxx X. Xxxxxxxxx
Chief Executive Officer
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