Contract
Exhibit 10.35
THIS
NOTE AND THE SECURITIES ISSUABLE UPON CONVERSION HEREOF HAVE 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 AND THE SECURITIES ISSUABLE UPON CONVERSION HEREOF MAY BE SOLD,
TRANSFERRED, OR OTHERWISE DISPOSED OF, UNDER AN EXEMPTION FROM REGISTRATION
UNDER THE ACT AND SUCH STATE SECURITIES LAWS.
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US
$205,401.61
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September
1, 2009
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|
(the
"Issuance
Date")
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Plus
interest at
Eighteen
Percent (18%)
For
a Term of One (1) Year
SUPERSEDING
CONVERTIBLE NOTE
FOR VALUE RECEIVED, AccessKey
IP, Inc. (the "Company" or "Maker" or "AccessKey"), a
Nevada corporation, having a place of business at 0000 X0 Xxxxxxx Xxxx XX, Xxxxx
000, Xxxxxxxxxxx, Xxx Xxxxxx, 00000, hereby promises to pay to the order of
Micro PIPE I, L.L.C. ("Payee", "Holder" or "Lender"), a Minnesota Limited
Liability Company, having its principal address at 000 Xxxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxxx, XX 00000, the sum of $205,401.61.
This Superseding Convertible Note (this "Note") is issued in conjunction
with one or more loans to the Company for the Company's operations, and
supersedes the previously issued August 22, 2008 Superseding Note.
All
payments under, or pursuant to this Note shall be made in United States dollars
in immediately available funds to the Lender at the address of the tender as set
forth in this Note: or at such other place as the Lender may designate from time
to time in writing to the Makers or by •wire transfer of funds to the
Lender's
account, instructions for which are attached hereto as Exhibit 'A'. The
outstanding principal balance of this Note shall be due and payable on the
one-year anniversary of the Issuance Date (the "Maturity
Date") or at such earlier time as provided herein.
Article
I
Deal
Terms.
1.1
Payments of
interest and Principal. Interest on the borrowed outstanding principal
balance under
this Note shall be payable monthly, commencing on the first banking day of April
2010, and on the first
business day of each calendar month thereafter until the Maturity
Date.
1.2
Security. This
Note is unsecured.
1.3
Interest.
Beginning on the Issuance Date of this Note, the outstanding principal balance
of this Note
shall bear interest (the "Interest"), in arrears, at a rate per annum
equal to eighteen
percent (18%) payable
in accordance with Section 1.1 and
thereafter so long as any principal amount evidenced by this Note
remains outstanding. Interest shall be computed on the basis of a 365-day year
and shall accrue
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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 Maker will pay interest in cash to the
Lender, 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 twenty five percent (25%) and the maximum applicable legal rate
per annum (the "Default
Rate").
1.4
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 am' interest therein or any income or profits therefrom,
except for indebtedness with respect to capital leases incurred in the ordinary
course of business. For the purpose of this Agreement, "Subsidiary" means, with respect to the
Company, any corporation or other entity of which at least a majority of the
outstanding shares of stock or other ownership interests having by the terms
thereof ordinary voting power to elect a majority of the board of directors (or
Persons performing similar functions) of such corporation or entity
(irrespective of whether or not at the time, in the case of a corporation, stock
of any other class or classes of such corporation shall have or might have
voting power by reason of the happening of any contingency) is at the time
directly or indirectly owned or controlled by the Company or one or more of its
Subsidiaries.
(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.
1.5
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.
1.6
Transfer. This
Note may be transferred or sold, subject to the provisions of this Note, or
pledged, hypothecated or otherwise granted as security by the
Lender.
1.7
Replacement,
Upon receipt of a duly executed and notarized written statement from the Lender
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 tenure and amount, in lieu of
such lost, stolen, destroyed or mutilated Note.
1.8
Pre-Payment
Option. Subject to customary equity conditions, the Company may at any
time upon 30 days written notice, prepay all of the outstanding Notes on a
pro-rata basis at 110% of the outstanding principal plus interest balance. In
the event that Maker sends a prepayment notice to Xxxxxx, Xxxxxx may elect prior
to the prepayment due date, which shall be included in the prepayment notice,
to
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convert
into common stock of AccessKey ("AccessKey
Common Stock"), all or part of
the amount of principal to be repaid by the proposed prepayment instead of
receiving such prepayment, if AccessKey enters into a business combination with
any other entity, including TeknoCreations, Inc., ("Tekno"),
and Teckno's common stock is publicly traded, AccessKey shall provide, in the
business combination agreement, that this note may be convertible into shares of
Tekno common stock on the same terms as are applicable to AccessKey Common Stock
herein.
Article
II
Optional /Mandatory
Conversion.
2.1
Optional/Mandatory
Conversion. At any time prior to repayment of all amounts as under the
Note, but not sooner than six months from the date of this Note, all or any
portion of the principal amount of the Note shall be convertible at the option
of the Lender into fully paid and nonassessable shares of AccessKey Common
Stock. The number of shares of AccessKey Common Stock that Lender shall be
entitled to receive upon conversion shall be equal to the number attained by
dividing the principal, including accrued interest pursuant to the Note being
converted by the Conversion Price. The "Conversion
Price" shall be shall be equal to the lesser of (a) $0.007 per share (the
"Fixed
Price") and (b) seventy percent (70%) of the average closing bid price
for Common Stock on the five Trading Days immediately prior to the Lender's
receipt of shares pursuant to such Conversion or payment, or Notice of such
Conversion. For purposes of the preceding sentence, (a) and (b), and the
pricing, where the Lender already has possession of shares pursuant to such
Conversion or payment, Notice shall be operative, and not receipt. For purposes
of the preceding sentence, if the Maker delivers shares on a date. other than
when shares are due or payable in accordance with the terms hereof, the Leader
can treat the share delivery as though made when due.
A. In
order to exercise the conversion privilege., Lender shall give written notice of
conversion to Maker stating Xxxxxx's election to convert this Note or the
portion thereof in whole or in part, as specified in said notice. As promptly as
practicable after receipt of the notice, Maker shall issue and shall deliver to
Lender a certificate or certificates for the number of full shares of AccessKey
Common Stock issuable upon the conversion of this Now or portion thereof
registered in the name of Lender in accordance with the provisions of this Section
2.1.
B. Each
conversion shall be deemed to have been effected on the date the conversion
notice shall have been received by Maker, as aforesaid, and Lender shall be
deemed to have become on said date the Lender of record of the shares of Common
Stock issuable upon such conversion. No fractional shares of Common Stock shall
be issued upon conversion of this Note. Any amounts so converted shall not be
reborrowed.
C. The
Lender shall not be entitled to convert, if such conversion would result in
beneficial ownership by the Lender and its affiliates, of more than 9.99% of the
outstanding shares of Common Stock of the Company on such exercise or conversion
date, including:
(i)
the number of shares of Common Stock beneficially owned by the Lender and its
affiliates (and such identified non-affiliated persons), and
(ii)
the
number of shares of Common Stock issuable upon the exercise of the warrant
and/or options and/or conversion.
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For the
purposes of this provision as set forth in the immediately preceding sentence,
beneficial ownership shall be. determined in accordance with Section 13(d) of the
Securities Exchange
Act of 1934, as amended, and Regulation 13d-3 thereunder. Subject to the
foregoing, the Lender shall not be limited to aggregate warrant and/or option
exercises and/or conversion of only 9.99% and aggregate warrant and/or option
exercises and/or conversion by the Lender may exceed 9.99%. The Lender may void
the exercise limitation described in this Section upon 61 days prior written
notice to the Company. The Lender may allocate which of the equity of the
Company deemed beneficially owned by the Lender shall be included in the 9,99%
amount described above and which shall be allocated to the excess above
9.99%.
Article
III
Events of Default;
Remedies.
3.1
Events of
Default. The occurrence of any of the following events shall be an "Event of Default" under this Note:
(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)
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
(c) the
Company's notice to the Lender, including by way of public announcement, at any
time, of its inability to comply (including for any of the reasons described. in
Section 3.8(a) hereof) or its intention not to comply with proper requests for
conversion of this Note into shares of Common Stock; or
(d)
either (i) the Makers shall fail to timely deliver the shares of Common Stock
upon an Optional Conversion of the Note, 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
(e)
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 00) business days after the Lender 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
3.1(e) and such default: is not fully cured within ten (.10) business clays
after the Lender delivers written notice to the Makers of the occurrence
thereof; or
(f)
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 Lender delivers written
notice to the Makers of the occurrence thereof; or
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(g)
either of the Makers shall (i) apply for ox consent to the appointment of, or
the taking of possession by, a receive4 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
(h) 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
(i) 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 Lender within five (5) business days of the
! Xxxxxx's request so long as the Lender 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
(j) the failure of
either of the Makers to pay any other amounts due to the Lender 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 Lender delivers written notice to the Maker
of the occurrence thereof; or
(k) the occurrence of
an event of default under any other Transaction Document
For the
purpose of this Note, "Transaction
Documents" shall. mean any document signed in connection with this
Note.
3.2
Remedies Upon An Event
of Default. If an Event of Default shall have occurred and shall be
continuing, the Lender 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 saint:: 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) demand that the principal
amount
5
of this
Note then outstanding shall be converted into shares of Common Stock at a
Conversion Price per share calculated pursuant to Section 3.1 hereof
assuming that the date that the Event of Default occurs is the Optional
Conversion Date (as defined in Section 3.1 hereof),
or (c) exercise or otherwise enforce any one or more of the Lender'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 Lender shall
operate as a waiver thereof Of otherwise prejudice the right of the Lender. 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.
3.3
Event of Default Triggers Cashless Exercise: In the event of Default, the
Company agrees grant the Investor cashless exercise rights on any warrant(s)
previously issued to the Investor under the original Common Stock Purchase
Warrant agreement (the "Warrants"). The Warrants shall
contain adjustment provisions to the exercise price that are consistent with
those afforded to the Conversion Price of this Note, shall feature fill-ratchet
and other standard anti-dilution protection. Warrants shall have a ten year
expiry and shall not require any board or shareholder approval to
exercise.
Article
IV
Use of
Proceeds.
4.1
Use of
Proceeds. The proceeds from the Note advanced herein shall be used for
the Maker's general corporate purposes consistent with the Maker's
business.
Article
V
Maker
Covenants.
5.1
Covenants.
Maker covenants and agrees that, so long as any indebtedness is outstanding
hereunder, it will comply with each of the following covenants (except in any
case where Xxxxxx has specifically consented otherwise in writing);
5.2
Financial
Reporting. Maker shall furnish to Lender a copy of each financial report
submitted on Form 10-K or 10-Q filed with the Securities and Exchange Commission
within seven (7) days of such filing.
5.3
Notice of Event of
Default. Maker shall furnish to Lender notice of the occurrence of any
Event of Default (as defined herein) within five (5) days after it becomes known
to an executive officer of Maker.
5.4
Financial
Statements. Maker shall furnish to Lender quarterly financial statements,
including balance slicers and statements of income, for the Company, which
statements shall be annually audited, as soon as practicable after they are
prepared for internal use.
5.5
Record Date. In
case the Company shall take record of the Lenders of its Common Stock for the
purpose of entitling diem to subscribe for or purchase Common Stock or
Convertible Securities, then the date of the issue or sale of the shares of
Common Stock shall be. deemed to be such record date.
5.6
No Impairment
The Company shall not, by amendment of its Certificate of Incorporation or
through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary action, avoid or
seek to avoid the observance or performance of any of the terms to be observed
or performed hereunder by the Company, but will at all times in good faith,
assist in
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the
carrying out of all the provisions of this Section 5 and in the taking of all
such action as may be necessary or appropriate in order to protect the
conversion rights of the Lender against impairment. In the event a Lender shall
elect to convert any Notes as provided herein, the Company cannot refuse
conversion based on any claim that such Lender or any one associated or
affiliated with such Lender has been engaged in any violation of law, violation
of an agreement to which such Lender is a party or for any reason whatsoever,
unless, an. injunction from a court:, or notice, restraining and or adjoining
conversion of ail or of said Notes shall have issued and the Company posts a
surety bond for the benefit of such Lender in an amount equal to one hundred
percent (100%) of the amount of the Notes the Lender has elected to convert,
which bond shall remain in effect until the completion of arbitration/litigation
of the dispute and the proceeds of which shall be payable to such Lender (as
liquidated damages) in the event it obtains judgment.
5.7
Certificates as to
Adjustments, Upon occurrence of each adjustment or readjustment of the
Conversion. Price or number of shares of Common Stock issuable upon conversion
of this Note pursuant to this Section 5.1.6, the
Company at its expense shall promptly compute such adjustment or readjustment in
accordance with the terms hereof and furnish to the Lender a certificate setting
forth such adjustment and readjustment, showing in detail the facts upon which
such adjustment or readjustment is based. The Company shall, upon written
request of the Lender, at any time, furnish or cause to be furnished to the
Lender a like certificate setting forth such adjustments and readjustments, the
applicable Conversion Price in effect at the time, and the number of shares of
Common Stock and the amount, if any, of other securities or property Which at
the time would be received upon the conversion of this Note. Notwithstanding the
foregoing, the Company shall not be obligated to deliver a certificate unless
such certificate would reflect an increase or decrease of at least one percent
(1%) 0.f such adjusted amount.
5.8
Issue Taxes.
The Makers shall pay any and all issue and other taxes, excluding federal, state
or local income taxes, that may be payable in respect of any issue or delivery
of securities on conversion of this Note pursuant thereto; provided, however,
that the Makers shall not be obligated to pay any transfer taxes resulting from
any transfer requested by the Lender in connection with any such
conversion.
5.9
Fractional
Shares, No fractional shares of Common Stock shall be issued upon
conversion of this Note. In lieu of any fractional shares to which the Lender
would otherwise be entitled, the Maker shall pay cash. equal to the product of
the fraction that would evidence such fractional shares multiplied by the
average of the Closing Bid Prices of the Common Stock for the five (5)
consecutive Trading Days immediately preceding the Conversion Date. The term
"Closing
Bid Price" shall mean, on any particular date (i) the last closing bid
price per share of the Common Stock on such date on the OTC Bulletin Board or
another registered national stock exchange on which the Common Stock is then
listed, or if there is no such price on such date, then the. last closing bid
price. on such exchange. or quotation system on the date nearest preceding such
date, or (ii) if the Common Stock is not listed then on the OTC Bulletin Board
or any registered national stock exchange, the last trading price for a share of
Common Stock in the over-the-counter market, as reported by the OTC Bulletin
Board or in the National Quotation Bureau Incorporated or similar organization
or agency succeeding to its functions of reporting prices) at the close of
business on such date, or (iii) if the Common Stock is not then reported by the
OTC Bulletin Board or the National Quotation Bureau Incorporated (or similar
organization or agency succeeding to its functions of reporting prices), then
the average of the "Pink Sheet" quotes for the relevant conversion period, as
determined in good faith by the Lender and reasonably acceptable to the Company,
or (iv) if the Common Stock is not then publicly traded the fair market value of
a share of. Common Stock as determined by the
7
Lender
and reasonably acceptable to the Company. The term “Trading
Days" shall mean any day that the New York Stock Exchange is open for
business.
5.10
Reservation of Common
Stock. The Company shall at all times when this Note shall. be
outstanding, reserve and keep available out of its authorized but unissued
Common Stock, one hundred twenty percent (120%) of such number of shares of
Common Stock as shall from time to time be sufficient to effect a full Optional
Conversion of this Note. The Company shall, from time to time in, increase the
authorized number of shares of Common Stock if at any time the unissued number
of authorized shares shall not be sufficient: to satisfy the Company's
obligations under this Note.
5.11
Regulatory
Compliance. If any shares of Common Stock to be reserved for the purpose
of an Conversion of this Note require registration or listing with or approval
of any governmental authority, stock exchange or other regulatory body under any
federal or state law or regulation or otherwise before such shares may be
validly issued or delivered upon conversion, the Company shall, at its sole cost
and expense, in good faith and. as expeditiously as possible, endeavor to secure
such registration, listing or approval, as the case may be.
Article
VI
Liquidated Damages/Remedies
not Exclusive.
6.1
Liquidated
Damages/Remedies not
Exclusive. The remedies of Lender provided herein or otherwise available
to Lender at law or in equity shall be cumulative and concurrent, and may be
pursued singly, successively and together at the sole discretion of Lender, and
may be exercised as often as occasion therefore shall occur; and the failure to
exercise any such right at remedy shall in no event be construed as a waiver or
release of the same.
6.2
Liquidated
Damages. In the event that the Company fails to deliver the Common Stock
when due, the number of Common Stock otherwise due shall increase by 5% for each
month or partial month, until the Company does deliver such shares. The parties
agree that this is a reasonable amount for liquidated damages, given the
difficulty to determine, in advance, what actual damages may occur.
Article
VII
Miscellaneous.
7.1
Notice. All
notices required to be given to any of the parties hereunder shall be in writing
and shall be deemed to have been sufficiently given for all purposes when
presented personally to such party or sent by certified or registered mail,
return receipt requested, to such party at its address set forth
below:
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if
to the Maker:
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0000
X0 Xxxxxxx Xxxx XX, Xxxxx 000
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Albuquerque,
New Mexico, 87113
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If
to the Lender:
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Micro
Pipe Fund 1, L.L.C.
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|
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000
Xxxxxxx Xxxxxx., Xxxxx 000
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Oceanside,
CA 92078
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Phone:
(000) 000-0000; Fax :(000) 000-0000
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Such
notice shall be deemed to be given when received if delivered personally or five
(5) business days after the date mailed. Any notice mailed shall be sent by
certified or registered mail. Any notice of any change in such address shall
also be given in the manner set forth above. Whenever the giving of notice is
required, the giving of such notice may be waived in writing by the party
entitled to receive such .notice.
7.2
Severability. In the event that any
provision of this Note is held to be invalid, illegal or unenforceable in
any respect or to any extent, such provision shall nevertheless remain valid,
legal and enforceable in all such other respects and to such extent as may be
permissible. Any such invalidity, illegality or enforecability shall not affect
any other provisions of this Note, but this Note shall be construed as if such
invalid, illegal or unenforceable provision had never been contained
herein.
7.3
Successors
and Assigns.
This Note inures to the benefit of the Lender and binds the Maker, and
its respective successors and assigns, and the words "Lender" and. "Maker"
whenever occurring herein shall be deemed and construed to include such
respective successors and assigns.
7.4
Assignment, The Lender may assign
this Note and Transaction Documents at any time without notice to the
Maker. The Maker may not assign, hypothecate, transfer or otherwise assign this
Note.
7.5
Entire
Agreement:, This Note embodies the entire understanding and agreement
between the parties hereto with respect to the subject matter hereof and
supersedes all or agreements and understandings, whether express or implied,
oral and written.
7.6
Modification of
Agreement, This Note may not be modified, altered or amended, except by
an agreement in writing signed by both the Maker and the Lender.
7.7
Governing Law.
This instrument shall be construed according to and governed by the laws of the State of
Illinois.
7.8
Consent
to Jurisdiction and Service of Process. Maker irrevocably
appoints each and every officer of .Maker as its attorney upon whom may
be served any notice, process or pleading in any action or proceeding against it
arising out of or in connection with this Note; and Maker hereby consents that
any action or proceeding against it be commenced and maintained in any court
within the State of Illinois by service of process on any such, officer; and
Maker agrees that the courts of the State of Illinois shall have jurisdiction
with respect to the subject matter hereof and the person of Maker and the
collateral securing Maker's obligations hereunder. Notwithstanding the
foregoing, Lender, in its absolute discretion may also initiate proceedings in
the courts of any other jurisdiction in which Maker may be found or in which any
of its properties or any such Collateral may be located.
7.9
Mandatory
Prepayments.
Maker shall apply, as Prepayments to the Loan until paid in full, all
payments or proceeds received by Maker with respect to the disposition or
sale of any of the Collateral (whether or not such sale or disposition is
permitted by the terms of the Pledge and Security Agreement).
7.10 Right
of First Refusal. The Lender shall have a
Right of First Refusal as to any financings of the Borrower/Maker within
a one-year period of this Note; provided however that
the Lender makes not representation and/or does it warrant that it will make any
such loan to Maker.
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7.11
Legal Fee. The
Makers agree to pay all costs and expenses of the Lender incurred as a result of
enforcement of this Note, including, without limitation, reasonable attorneys'
fees and expenses.
7.12
Anti-Dilution.
The conversion price of the notes will be subject to full ratchet anti-dilution
adjustment in the event that the company issues additional equity or
equity-linked securities, referred to herein as "derivatives" (other than for
specific "carve out" issuances) at a purchase or conversion, price that is less
than the applicable conversion price of the notes..
[Signature
Page to Follow.]
10
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:
/s/ Xxxxx Xxxxxx
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Name:
Xxxxx Xxxxxx
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Title:
President
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Date:
10/19/09
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Regarding
Section
1.9
Acknowledged
by TeknoCreations, Inc.
By: /s/ Xxxxx Xxxxxx
name:
Xxxxx Xxxxxx
Title:
President
Date:
10/19/09
Acknowledged
by the Lender:
Micro
PIPE Fund I, L.L.C.
By: /s/ Xxxxx Xxxxxxxxx
Name:
Xxxxx Xxxxxxxxx
Title:
Date:
10/19/09
11
EXHIBIT
A
FUNDING
INSTRUCTIONS:
Payment
by check:
Please
make checks payable to Micro
PIPE Fund I, LLC
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Send
to:
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Micro
PIPE Capital Management, LLC
000
Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx,
XX 00000
Attn:
Xxxx Xxxxxxxx
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Payment
by wire Transfer:
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Bank
Name:
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Union
Bank of California
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Bank
Address:
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000
X Xxxxxx, Xxxxx 000
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San
Diego, CA 92101
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Account
Name:
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Micro
PIPE Fund I, LLC
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Account
Number:
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XXXXXXX
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Routing
Number:
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XXXXXXX
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12
