EXHIBIT 10.2
NEITHER THIS DEBENTURE, NOR ANY SECURITY ISSUABLE UPON CONVERSION THEREOF, HAS
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). NO
INTEREST IN THIS DEBENTURE MAY BE OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (ii) TO THE EXTENT APPLICABLE,
PURSUANT TO RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER THE ACT), OR (iii)
AN EXEMPTION FROM REGISTRATION UNDER THE ACT WHERE THE HOLDER HAS FURNISHED TO
THE COMPANY AN OPINION OF ITS COUNSEL THAT AN EXEMPTION FROM REGISTRATION UNDER
THE ACT IS AVAILABLE.
TELEHUBLINK CORPORATION
10% SUBORDINATED CONVERTIBLE DEBENTURE
$25,000 , 1999
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Number New York, New York
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FOR VALUE RECEIVED, the undersigned, TeleHubLink Corporation, a Delaware
corporation ("Payor"), having its executive office at 00 Xxx Xxxxxxx Xxxxxxxxx
Xxxx, Xxxxxxxxxx, XX 00000 (telecopier no. (000) 000-0000), hereby promises to
pay to the order of _________________________ or registered assigns ("Payee"),
having an address at _________________________, Attn:_______________ (telecopier
no._________________), at Payee's address set forth above (or at such other
place as Payee may from time to time hereafter direct by notice in writing to
Payor), the principal sum of Twenty-Five Thousand Dollars ($25,000), in such
coin or currency of the United States of America as at the time shall be legal
tender for the payment of public and private debts, on the first to occur of the
following dates:_______________, 2000 (the "Maturity Date") [I.E., first
anniversary of Initial Closing]; (ii) the date on which the outstanding
principal amount of this Debenture is prepaid in full as hereinafter permitted
(the "Prepayment Date"); and (iii) any date on which any principal amount of, or
accrued unpaid interest on, this Debenture is declared to be, or becomes, due
and payable pursuant to its terms prior to the Maturity Date (the "Acceleration
Date").
This Debenture is part of a unit or units (the "Units") and one of a series
of Debentures being issued pursuant to Payor's Confidential Private Offering
Memorandum dated June 8, 1999 (the "Memorandum"), relating to the offering of
Units, each Unit consisting of a 10% subordinated convertible debenture in the
principal amount of $25,000 (each, a "Debenture").
1. INTEREST AND PAYMENT.
1.1. The principal amount of this Debenture outstanding from time to
time shall bear simple interest at the annual rate (the "Debenture Rate") of ten
percent (10%) from the date hereof through the earliest to occur of (i) the
Maturity Date, (ii) the Prepayment Date and (iii) the Acceleration Date.
1.2. Interest accrued on this Debenture shall be payable on the
earliest to occur of (i) the Maturity Date, (ii) the Prepayment Date and (iii)
the Acceleration Date.
1.3. All payments made by the Payor on this Debenture shall be applied
first to the payment of accrued unpaid interest on this Debenture and then to
the reduction of the unpaid principal balance of this Debenture.
1.4. If payment of the outstanding principal amount of this Debenture,
together with accrued unpaid interest thereon at the Debenture Rate, is not made
on the earliest to occur of (i) the Maturity Date, (ii) the Prepayment Date and
(iii) the Acceleration Date, then interest shall accrue on the outstanding
principal amount due under this Debenture and on any unpaid accrued interest due
on this Debenture from and after such date of default to the date of the payment
in full of such amounts (including from and after the date of the entry of
judgment in favor of Payee in an action to collect this Debenture) at an annual
rate equal to the lesser of 18% or the maximum rate of interest permitted by
applicable law (the "Maximum Rate").
1.5. In no event shall Payee be entitled to receive interest, however
characterized and including other consideration received in connection with this
Debenture, at an effective rate in excess of the Maximum Rate. In the event that
a court of competent jurisdiction determines that such amounts paid or agreed to
be paid by Payor in connection with this Debenture causes the effective interest
rate on this Debenture to exceed the Maximum Rate, such interest or other
consideration shall automatically be reduced to a rate which results in an
effective interest rate under this Debenture equal to the Maximum Rate over the
term hereof, and, in such event, any amounts received by Payee deemed to
constitute excessive interest shall be applied first to the payment of accrued
unpaid interest on this Debenture and then to the reduction of the unpaid
principal balance of this Debenture.
1.6. In the event that the date for the payment of any amount payable
under this Debenture falls due on a Saturday, Sunday or public holiday under the
laws of the State of New York, the time for payment of such amount shall be
extended to the next succeeding business day and interest at the Debenture Rate
shall continue to accrue on any principal amount so effected until the payment
thereof on such extended due date.
2. REPLACEMENT OF DEBENTURE.
2.1. In the event that this Debenture is mutilated, destroyed, lost or
stolen, Payor shall, at its sole expense, execute, register and deliver a new
Debenture, in exchange and substitution for this Debenture, if mutilated, or in
lieu of and substitution for this Debenture, if destroyed, lost or stolen. In
the case of destruction, loss or theft, Payee shall furnish to Payor indemnity
reasonably satisfactory to Payor, and in any such case, and in the case of
mutilation, Payee shall also furnish to Payor evidence to its reasonable
satisfaction of the mutilation, destruction, loss or theft of this Debenture and
of the ownership thereof. Any replacement Debenture so issued shall be in the
same outstanding principal amount as this Debenture and dated the date to which
interest shall have been paid on this Debenture or, if no interest shall have
yet been paid, dated the date of this Debenture.
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2.2. Every Debenture issued pursuant to the provisions of Section 2.1
above in substitution for this Debenture shall constitute an additional
contractual obligation of the Payor, whether or not this Debenture shall be
found at any time or be enforceable by anyone.
3. PREPAYMENT. At the option of the Payor, the principal amount of this
Debenture may be prepaid in whole at any time, or in part from time to time,
without penalty or premium, together with interest thereon accrued through the
Prepayment Date. Each partial prepayment of this Debenture shall first be
applied to interest accrued through the Prepayment Date and then to principal.
In the event of any such prepayment, Payor shall deliver written notice thereof
to the holder of this Debenture at least thirty (30) days prior to the
applicable Prepayment Date.
4. EVENTS OF DEFAULT. If any of the following events (each an "Event of
Default") occurs:
4.1. The dissolution of Payor or any vote in favor thereof by the board
of directors and shareholders of Payor; or
4.2. Payor becomes insolvent, however evidenced, or makes an assignment
for the benefit of creditors, or files with a court of competent jurisdiction an
application for appointment of a receiver or similar official with respect to it
or any substantial part of its assets, or Payor files a petition seeking relief
under any provision of the Federal Bankruptcy Code or any other federal or state
statute now or hereafter in effect affording relief to debtors, or any such
application or petition is filed against Payor, which application or petition is
not dismissed or withdrawn within thirty (30) days from the date of its filing;
or
4.3. Payor fails to pay the principal amount, or interest on, or any
other amount payable under, this Debenture as and when the same becomes due and
payable; or
4.4. Xxxxx admits in writing its inability to pay its debts as they
mature; or
4.5. A proceeding is commenced to foreclose a security interest or lien
in any property or assets of Payor as a result of a default in the payment or
performance of any debt (in excess of $250,000 and secured by such property or
assets) of Payor; or
4.6. A final judgement for the payment of money in excess of $250,000
is entered against Payor by a court of competent jurisdiction, and such judgment
is not discharged (nor the discharge thereof duly provided for) in accordance
with its terms, nor a stay of execution thereof procured, within sixty (60) days
after the date such judgment is entered, and, within such period (or such longer
period during which execution of such judgment is effectively stayed), an appeal
therefrom has not been prosecuted and the execution thereof caused to be stayed
during such appeal; or
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4.7. An attachment or garnishment is levied against the assets or
properties of Payor or any subsidiary of Payor involving an amount in excess of
$250,000 and such levy is not vacated, bonded or otherwise terminated within
sixty (60) days after the date of its effectiveness; or
4.8. Payor defaults in the due observance or performance of any
covenant, condition or agreement on the part of Payor to be observed or
performed pursuant to the terms of this Debenture (other than the default
specified in Section 4.3 above) and such default continues uncured for a period
of sixty (60) days; or
4.9. Payor defaults in the payment (regardless of amount) when due of
the principal of, interest on, or any other liability on account of, any
indebtedness of Payor having a face or principal amount in excess of $250,000,
or a default occurs in the performance or observance by Payor of any covenant or
condition (other than for the payment of money) contained in any note or
agreement evidencing or pertaining to any such indebtedness, which causes the
maturity of such indebtedness to be accelerated and such default is not waived
or cured within thirty (30) days of receipt of notice by the Payor that such
default has occurred;
then, upon the occurrence of any such Event of Default and at any time
thereafter, the holder of this Debenture shall have the right (at such holder's
option) to declare the principal of, accrued unpaid interest on, and all other
amounts payable under this Debenture to be forthwith due and payable, whereupon
all such amounts shall be immediately due and payable to the holder of this
Debenture, without presentment, demand, protest or other notice of any kind, all
of which are hereby expressly waived; provided, however, that in case of the
occurrence of an Event of Default under any of Sections 4.1, 4.2 or 4.4 above,
such amounts shall become immediately due and payable without any such
declaration by the holder of this Debenture.
5. CONVERSION.
5.1. The holder of this Debenture shall have the right, at its option
(the "Conversion Option"), at any time within not more than twenty (20) days, or
less than ten (10) days, prior to the earliest to occur of the Maturity Date or
the Prepayment Date, to convert, in whole but not in part, the principal amount
of this Debenture, together with accrued unpaid interest thereon, outstanding at
the close of business on the date Payor receives notice of such holder's
exercise of the Conversion Option, into fully paid and nonassessable shares of
Common Stock, par value $.01 per share (the "Conversion Shares"), at a
conversion price per Conversion Share equal to $0.50, as such price may be
adjusted from time to time in accordance with the provisions of this Section 5
(the "Conversion Price"), such that the number of Conversion Shares obtained
upon conversion shall be determined by dividing the then Conversion Price into
the sum of the then outstanding principal amount of, and accrued unpaid interest
on, this Debenture.
5.2. To exercise the Conversion Option, the holder hereof shall give
written notice to Payor that it elects to convert the principal amount of this
Debenture, together with accrued unpaid interest thereon, into Conversion Shares
in accordance with the provisions of Section 5.1 above (the "Conversion
Notice"). The Conversion Notice shall specify the name or names in which the
holder wishes the certificates for the Conversion Shares to be registered,
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together with the address or addresses of the persons so named, provided such
Conversion Shares may not be registered in the name of a person or persons other
than the holder of this Debenture unless the Debenture, when surrendered for
conversion, is accompanied by (i) instruments of transfer in form reasonably
satisfactory to Payor, duly executed by the holder hereof and (ii) if requested
by Xxxxx, an instrument executed by such other person, in form reasonably
satisfactory to Payor, representing that the Conversion Shares are being
acquired for investment and not with a view to distribution within the meaning
of the Securities Act of 1933, as amended.
5.3. Promptly after the delivery of the Conversion Notice to Payor,
Payor shall cause to be delivered to the holder and/or the holder's designees
certificates representing the number of Conversion Shares into which this
Debenture is being converted and a cash adjustment in respect of any fraction of
a Conversion Share to which the holder shall be entitled. No fractional
Conversion Shares will be issued, but an amount of cash equal to the product of
the fraction of a Conversion Share which would otherwise be issuable upon the
surrender of this Debenture for conversion multiplied by the then existing
Conversion Price per Conversion Share will be paid to the holder upon such
conversion.
Conversion of this Debenture shall be deemed to have been made at the close
of business on the date the Conversion Notice is delivered to Payor (the
"Conversion Date"), so that interest shall not accrue from and after such date
on the principal amount of this Debenture converted and the person or persons
entitled to receive Conversion Shares upon such conversion shall be treated for
all purposes as having been the record holder or holders thereof at such time
and such conversion shall be at the Conversion Price in effect at such time. The
issuance of certificates for Conversion Shares upon conversion of this Debenture
shall be made without charge to the holder of this Debenture for any tax in
respect of the issuance of such certificates; provided, however, that Payor
shall not be required to pay any tax which may be payable in respect of any
transfer involved in the issuance and delivery of any such certificates in a
name other than that of the Payee and Payor shall not be required to issue or
deliver such certificates unless or until the person or persons requesting the
issuance thereof shall have paid to Payor the amount of such tax or shall have
established to the satisfaction of Payor that such tax has been paid. Upon
Payor's (i) delivery of the certificates for the Conversion Shares to the holder
of this Debenture and/or its designees and (ii) payment of the cash adjustment,
if any, due to the holder of this Debenture pursuant to the terms of this
Section 5, the holder of this Debenture shall surrender this Debenture to Payor.
The Certificates representing the Conversion Shares shall be executed on
behalf of Payor by the manual or facsimile signature of those officers required
to sign such certificates under applicable law, and shall bear legends
substantially similar to the following:
"The securities represented by this certificate and/or the securities
issuable upon exercise thereof have not been registered under the
Securities Act of 1933, as amended (the "Act"), and may not be offered
or sold except (i) pursuant to an effective registration statement
under the Act, (ii) to the extent applicable, pursuant to Rule 144
under the Act (or any similar rule under such Act relating to the
disposition of securities), or (iii) upon the delivery by the holder to
the
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Company of an opinion of counsel, satisfactory to counsel to the
Company, stating that an exemption from registration under such Act is
available."
5.4. Payor shall at all times keep available out of its authorized but
unissued shares of Common Stock, solely for effecting the conversion of this
Debenture, the full number of whole Conversion Shares then deliverable upon
conversion of the entire principal amount of this Debenture, and accrued unpaid
interest thereon, at the time outstanding. Payor shall take at all times such
corporate action as shall be necessary in order that Payor may validly and
legally issue fully paid and nonassessable shares of Common Stock in accordance
with the provisions of this Section 5.
5.5. In the event Payor shall at any time after the date hereof pay a
dividend in shares of Common Stock or make a distribution in shares of Common
Stock, then upon such dividend or distribution, the Conversion Price in effect
immediately prior to such dividend or distribution shall be reduced to a price
determined by dividing an amount equal to the total number of shares of Common
Stock outstanding immediately prior to such dividend or distribution multiplied
by the Conversion Price in effect immediately prior to such dividend or
distribution, by the total number of shares of Common Stock outstanding
immediately after such issuance or sale. For purposes of any computation to be
made in accordance with the provisions of this Section 5.5, the shares of Common
Stock issuable by way of dividend or distribution shall be deemed to have been
issued immediately after the opening of business on the date following the date
fixed for determination of shareholders entitled to receive such dividend or
distribution.
5.6. In the event the Payor shall at any time subdivide or combine the
outstanding shares of Common Stock, the Conversion Price shall forthwith be
proportionately decreased in the case of subdivision or increased in the case of
combination.
5.7. In the event the Payor shall, at any time or from time to time
after the date hereof, issue any shares of Common Stock or other securities
convertible into, or exchangeable or exercisable for, Common Stock, in each case
other than Excluded Shares (as hereinafter defined), for no consideration or for
a consideration per share less than the Conversion Price in effect immediately
prior to the issuance of such Common Stock or other securities, the Conversion
Price in effect immediately prior to each such issuance shall automatically be
lowered to a price equal to the consideration per share received by the Payor
upon such issuance. In the case of the issuance of Common Stock for a
consideration in whole or part in property other than cash, the value of such
property shall be deemed to be the fair market value of such property as
determined in good faith by the Board of Directors of the Payor. As used herein,
the term "Excluded Shares" shall mean (i) shares of Common Stock issued in
connection with transactions described in Sections 5.5 and 5.6 hereof, (ii)
shares of Common Stock issued upon the exercise or conversion of any options,
rights, warrants or other securities outstanding on the date hereof, and (iii)
shares of Common Stock issued to officers, directors or employees of, or
consultants to, the Payor pursuant to any agreement, plan or arrangement
approved prior to the date hereof by the Board of Directors of the Payor or a
committee thereof authorized to give such approval.
5.8. In the event of any reclassification or change of the outstanding
Common Stock (other than a change in nominal value to no nominal value, or from
no nominal
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value to nominal value, or as a result of a subdivision or combination), or in
the case of any consolidation of the Payor with, or merger of the Payor into,
another corporation (other than a consolidation or merger in which the Payor is
the surviving corporation and which does not result in any reclassification or
change of the outstanding Common Stock, except a change as a result of a
subdivision or combination of such shares or a change in nominal value, as
aforesaid), or in the case of a sale or conveyance to another corporation of the
property of the Payor as an entirety, the holder of this Debenture shall
thereafter have the right to convert this Debenture into the kind and number of
shares of stock and other securities and property receivable upon such
reclassification, change, consolidation, merger, sale or conveyance by holders
of the number of shares of Common Stock into which this Debenture could have
been converted immediately prior to such reclassification, change,
consolidation, merger, sale or conveyance, subject to further adjustments as
provided herein.
5.9. In the event:
(1) Payor shall take a record of the holders of its Common Stock
for the purpose of entitling them to receive a dividend or distribution payable
otherwise than in cash, or a cash dividend or distribution payable otherwise
than out of current or retained earnings, as indicated by the accounting
treatment of such dividend or distribution on the books of Payor; or
(2) Payor shall offer to all the holders of its Common Stock any
additional shares of Common Stock or other shares of capital stock of Payor or
securities convertible into or exchangeable for Common Stock or other shares of
capital stock of Payor, or any option, right or warrant to subscribe therefor;
or
(3) a reclassification or change of the outstanding Common Stock
(other than a change in nominal value to no nominal value, or from no nominal
value to nominal value, or as a result of a subdivision or combination), or any
consolidation of the Payor with, or merger of the Payor into, another
corporation (other than a consolidation or merger in which the Payor is the
surviving corporation and which does not result in any reclassification or
change of the outstanding Common Stock, except a change as a result of a
subdivision or combination of such shares or a change in nominal value, as
aforesaid), shall be proposed; or
(4) a dissolution, liquidation or winding up of Payor (other than
in connection with a consolidation or merger) or a sale of all or substantially
all of its property, assets and business as an entirety shall be proposed;
then, in any one or more of said events, Payor shall give written notice of such
event at least fifteen (15) days prior to the date fixed as a record date or the
date of closing the transfer books for the determination of the shareholders
entitled to such dividend, distribution, convertible or exchangeable securities
or subscription rights, options or warrants, or entitled to vote on such
proposed reclassification, merger, consolidation, dissolution, liquidation,
winding up or sale. Such notice shall specify such record date or the date of
closing the transfer books, as the case may be. Failure to give such notice or
any defect therein shall not affect the validity of any action taken in
connection with the declaration or payment of any such dividend or distribution,
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or the issuance of any convertible or exchangeable securities or subscription
rights, options or warrants, or any proposed reclassification, merger,
consolidation, dissolution, liquidation, winding up or sale.
6. WARRANTS. If the holder of this Debenture elects to receive payment in
the form of Conversion Shares in accordance with Section 5 hereof, the holder
shall receive concurrent with such payment, redeemable warrants, in the form of
Exhibit H to the Memorandum ("Warrants"), to purchase an aggregate of 50,000
shares of Common Stock at an exercise price of $2.00 per share, subject to
adjustment under certain circumstances, for each Debenture converted into Common
Stock. If the holder elects to receive payment in the form of cash, the holder
shall receive, concurrent with such payment, Warrants to purchase an aggregate
of 6,250 shares of Common Stock at an exercise price of $2.00 per share, subject
to adjustment under certain circumstances, for each Debenture paid in cash.
Notwithstanding the foregoing, the number of warrants issuable shall be
proportionately reduced in any case where partial Units are sold.
7. SUITS FOR ENFORCEMENT AND REMEDIES. If any one or more Events of Default
shall occur and be continuing, the Payee may proceed to (i) protect and enforce
Payee's rights either by suit in equity or by action at law, or both, whether
for the specific performance of any covenant, condition or agreement contained
in this Debenture or in any agreement or document referred to herein or in aid
of the exercise of any power granted in this Debenture or in any agreement or
document referred to herein, (ii) enforce the payment of this Debenture, or
(iii) enforce any other legal or equitable right of the holder of this
Debenture. No right or remedy herein or in any other agreement or instrument
conferred upon the holder of this Debenture is intended to be exclusive of any
other right or remedy, and each and every such right or remedy shall be
cumulative and shall be in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or by statute or
otherwise.
8. UNCONDITIONAL OBLIGATION; FEES, WAIVERS, OTHER.
8.1. The obligations to make the payments provided for in this
Debenture are absolute and unconditional and not subject to any defense,
set-off, counterclaim, rescission, recoupment or adjustment whatsoever.
8.2. If, following the occurrence of an Event of Default, Payee shall
seek to enforce the collection of any amount of principal of and/or interest on
this Debenture, there shall be immediately due and payable from Payor, in
addition to the then unpaid principal of, and accrued unpaid interest on, this
Debenture, all costs and expenses incurred by Payee in connection therewith,
including, without limitation, reasonable attorneys' fees and disbursements.
8.3. No forbearance, indulgence, delay or failure to exercise any right
or remedy with respect to this Debenture shall operate as a waiver or as an
acquiescence in any default, nor shall any single or partial exercise of any
right or remedy preclude any other or further exercise thereof or the exercise
of any other right or remedy.
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8.4. This Debenture may not be modified or discharged (other than by
payment or conversion) except by a writing duly executed by Xxxxx and Xxxxx.
8.5. Payor hereby expressly waives demand and presentment for payment,
notice of nonpayment, notice of dishonor, protest, notice of protest, bringing
of suit, and diligence in taking any action to collect amounts called for
hereunder, and shall be directly and primarily liable for the payment of all
sums owing and to be owing hereon, regardless of and without any notice,
diligence, act or omission with respect to the collection of any amount called
for hereunder or in connection with any right, lien, interest or property at any
and all times which Payee had or is existing as security for any amount called
for hereunder.
8.6. Payor shall bear all of its expenses, including attorneys' fees,
incurred in connection with the preparation of this Debenture.
9. INVESTMENT INTENT. The Payee, by its acceptance of this Debenture,
covenants and agrees that the Debenture and the Conversion Shares issuable upon
conversion of the Debenture are being acquired as an investment and not with a
view to the distribution thereof.
10. REGISTRATION RIGHTS. The Payee shall be entitled to all of the rights
set forth in the Registration Rights Agreement dated as of the date hereof
between Payor and Payee.
11. SUBORDINATION. The indebtedness represented by this Xxxxxxxxx, and the
payment of the principal of and accrued interest on this Debenture are hereby
made expressly subordinate and subject in right of payment to the prior payment
in full of all Senior Indebtedness, whether outstanding on the date hereof or
hereafter created, incurred or assumed. As used herein, the term "Senior
Indebtedness" shall mean the principal of, and premium (if any) and unpaid
interest and fees on, (i) all obligations incurred by Payor (whether as borrower
or guarantor) and/or any of its subsidiaries under or pursuant to any loan or
credit agreement with one or more banks and/or other institutional lenders, (ii)
all indebtedness of the Payor and/or any of its subsidiaries for monies borrowed
by the Payor from other persons or entities, (iii) all obligations of the Payor
and/or any of its subsidiaries as lessee under leases of real or personal
property, (iv) all indebtedness incurred by the Payor and/or any of its
subsidiaries to finance the acquisition by it of assets classified as capital
assets under generally accepted accounting principles, (v) all indebtedness or
obligations of others of the kinds described in clauses (i), (ii), (iii) and
(iv) above assumed or guaranteed in any manner by the Payor and/or any of its
subsidiaries, (vi) deferrals, renewals, extensions and refundings of any such
indebtedness or obligations described in clauses (i), (ii), (iii), (iv) and (v),
and any other indebtedness of the Payor and/or any of its subsidiaries which the
Payor and the holders of more than 50% of the unpaid principal amount of the
Debentures then outstanding may hereafter from time to time expressly agree in
writing shall constitute Senior Indebtedness. Notwithstanding the foregoing,
"Senior Indebtedness" shall not include indebtedness of the Payor evidenced by
the other Debentures which shall rank equally and ratably with this Debenture.
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12. MISCELLANEOUS.
12.1. The headings of the various paragraphs of this Debenture are for
convenience of reference only and shall in no way modify any of the terms or
provisions of this Debenture.
12.2. All notices required or permitted to be given hereunder shall be
in writing and shall be deemed to have been duly given or made as of the date
delivered, if personally delivered, or one (1) business day after having been
deposited with courier, if sent by overnight courier or by telecopy (receipt
confirmed), or three (3) business days after having been mailed, if sent by
registered or certified mail (return receipt requested, postage prepaid), to the
address of the intended recipient as set forth in the preamble to this Debenture
or at such other address as the intended recipient shall have hereafter given to
the other party hereto pursuant to the provisions of this Debenture.
12.3. This Debenture and the obligations of Payor and the rights of
Payee shall be governed by and construed in accordance with the substantive laws
of the State of New York without giving effect to the choice of laws rules
thereof.
12.4. Payor (i) agrees that any legal suit, action or proceeding
arising out of or relating to this Debenture shall be instituted exclusively in
the New York State Supreme Court, County of New York or in the United States
District Court for the Southern District of New York, (ii) waives any objection
which Payor may have now or hereafter based upon FORUM NON CONVENIENS or to the
venue of any such suit, action or proceeding, and (iii) irrevocably consents to
the jurisdiction of the New York State Supreme Court, County of New York and the
United States District Court for the Southern District of New York in any such
suit, action or proceeding. Xxxxx further agrees to accept and acknowledge
service of any and all process which may be served in any such suit, action or
proceeding in the New York State Supreme Court, County of New York or in the
United States District Court for the Southern District of New York and agrees
that service of process upon the Payor, mailed by certified mail to the Payor's
address, will be deemed in every respect effective service of process upon
Payor, in any suit, action or proceeding. FURTHER, BOTH PAYOR AND XXXXX XXXXXX
WAIVE TRIAL BY JURY IN ANY ACTION TO ENFORCE THIS DEBENTURE AND IN CONNECTION
WITH ANY DEFENSE, COUNTERCLAIM OR CROSSCLAIM ASSERTED IN ANY SUCH ACTION.
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12.5. This Debenture shall bind Payor and its successors and assigns.
TELEHUBLINK CORPORATION
By: /s/ XXXXX XXXXX
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Xxxxx Xxxxx, President
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