EXIBIT 10.60 Form of Working Capital Note dated September 24, 2007
EXIBIT
10.60
Form
of
Working Capital Note dated September 24, 2007
-1-
Exhibit
D
MANARIS
CORPORATION
FORM
OF
XXXXXX
SECURED WORKING CAPITAL NOTE
| Issue Date: ___________, 200__ |
$_____________
|
FOR
VALUE RECEIVED, MANARIS
CORPORATION, a
Nevada
corporation (the
“Company”),
hereby promises to pay to the order of IMPERIUM MASTER FUND, LTD. or its
permitted successors or assigns (the “Holder”)
the
principal amount of ________________________ Dollars ($___________), together
with accrued and unpaid interest thereon, on or before [____________] (the
“Maturity
Date”).
The
Company has issued this Senior
Secured Working Capital Note (this “Note”)
pursuant
to a Securities Purchase and Loan Agreement, dated as of September 24, 2007
(the
“Loan
Agreement”).
The
Senior
Secured Working Capital Notes
issued
by the Company pursuant to the Loan Agreement, including this Note, are
collectively referred to herein as the “Notes”.
The
Company’s obligations under the Notes, including, without limitation, its
obligation to make payments of interest thereon, are guaranteed by the Company’s
subsidiaries and secured by the assets and properties of the Company and its
subsidiaries. The following terms shall apply to this Note:
1. DEFINITIONS.
(a) Defined
Terms.
The
following terms shall apply to this Note:
“Acceleration
Notice,”
“Acceleration
Notice Date”
and
“Acceleration
Payment Date”
have
the respective meanings set forth in Section
3(a)
of this
Note.
“Change
of Control”
means
the existence, occurrence or public announcement of, or entering into an
agreement contemplating, any of the following: (a) the sale, conveyance or
disposition of more than twenty-five percent (25%) of the assets of the Company,
(b) the effectuation of a transaction or series of transactions in which more
than fifty percent (50%) of the voting power of the Company is transferred
or
otherwise disposed of; (c) the effectuation of a transaction or series of
transactions in which any of the voting power of any Company Subsidiary is
transferred or otherwise disposed to a Person other than the Company or another
Company Subsidiary; (d) the consolidation, merger or other business combination
of the Company with or into any other entity, immediately following which the
prior stockholders of the Company fail to own, directly or indirectly, at least
seventy-five percent (75%) of the surviving entity; (e) the consolidation,
merger or other business combination of any Company Subsidiary with or into
any
other entity other than the Company or another Company Subsidiary; (f) a
transaction or series of transactions in which any Person or group acquires
more
than fifty percent (50%) of the voting equity of the Company; (g) a transaction
or series of transactions in which any Person or group (other than the Company
or a Company Subsidiary) acquires any of the voting equity of a Company
Subsidiary; and (h) the Continuing Directors do not at any time constitute
at
least a majority of the Board of Directors.
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“Continuing
Director”
means,
at any date, a member of the Company’s Board of Directors (i) who was a member
of such board on the Issue Date or (ii) who was nominated or elected by at
least
a majority of the directors who were Continuing Directors at the time of such
nomination or election or whose election to the Company’s Board of Directors was
recommended or endorsed by at least a majority of the directors who were
Continuing Directors at the time of such nomination or election or such lesser
number comprising a majority of a nominating committee if authority for such
nominations or elections has been delegated to a nominating committee whose
authority and composition have been approved by at least a majority of the
directors who were Continuing Directors at the time such committee was
formed.
“Default
Interest Rate”
means
the lower of eighteen (18%) and the maximum rate permitted by applicable law
or
by the applicable rules or regulations of any governmental agency or of any
stock exchange or other self-regulatory organization having jurisdiction over
the Company or the trading of its securities.
“Event
of Default”
means
the occurrence of any of the following events:
(i) a
Liquidation Event occurs or is publicly announced;
(ii) the
Company fails to make any payment of principal on this Note in full as and
when
such payment is due, or the Company fails to make any payment of interest on
this Note in full as and when such payment is due, provided that the Company
shall not have been able to cure such non-payment within four (4) Business
Days
after such due date;
(iii)
other
than a breach described in clause
(ii)
above,
the Company or any Company Subsidiary breaches or provides notice of its intent
to breach any material term or condition of this Note or any other Transaction
Document, provided that such breach is not cured within seven (7) Business
Days
following written notice thereof from the Holder;
(iv) any
representation or warranty made by the Company or any Company Subsidiary in
this
Note or any other Transaction Document was inaccurate or misleading in any
material respect as of the date such representation or warranty was made;
or
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(v) a
default
occurs or is declared and is not cured within the applicable grace period (if
any) with respect to any instrument that evidences Debt of the Company or any
Company Subsidiary, the effect of which default is to cause, or permit the
holder or holders of such indebtedness to cause, such indebtedness to become
due
prior to its stated maturity solely to the extent that the principal amount
of
any such indebtedness exceeds, individually or in the aggregate,
$1,000,000.
“Interest”
has
the
meaning set forth in Section
2(a)
of this
Note.
“Issue
Date”
means
the “Issue Date” as set forth on the front page of this Note.
“Liquidation
Event”
means
where (i) the Company or any Company Subsidiary shall make a general assignment
for the benefit of creditors or consent to the appointment of a receiver,
liquidator, custodian, or similar official of all or substantially all of its
properties, or any such official is placed in control of such properties, or
the
Company or any Company Subsidiary shall commence any action or proceeding or
take advantage of or file under any federal or state insolvency statute,
including, without limitation, the United States Bankruptcy Code, seeking to
have an order for relief entered with respect to it or seeking adjudication
as a
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
liquidation, dissolution, administration, a voluntary arrangement, or other
relief with respect to it or its debts; or (ii) there shall be commenced against
the Company or any Company Subsidiary any action or proceeding of the nature
referred to in clause
(i)
above or
seeking issuance of a warrant of attachment, execution, distraint, or similar
process against all or any substantial part of its property, which results
in
the entry of an order for relief which remains undismissed, undischarged or
unbonded for a period of sixty (60) days; or (iii) there is initiated the
dissolution or other winding up of the Company or
any
material Company Subsidiary,
whether
voluntary or involuntary and whether or not involving insolvency or bankruptcy
proceedings; or (iv) there is initiated any assignment for the benefit of
creditors or any marshalling of the material assets or material liabilities
of
the Company
or any
Company Subsidiary.
“Make-whole
Amount”
means
the Make-whole Per Diem Amount multiplied
by
the
number of days between and including (i) the Acceleration Notice Date or
Prepayment Date, as the case may be, and (ii) the Maturity Date.
“Make-whole
Per Diem Amount”
means
the amount equal to (i) the product of (x) the outstanding principal amount
of
this Note and (y) the Make-whole Rate divided
by
(ii)
360.
“Make-whole
Rate”
means
the interest rate equal to the difference between [INSERT
INTEREST RATE OF THIS NOTE]%
and
the then current yield rate of 1-year treasury bills on the date of
determination.
“Maturity
Date”
has
the
meaning set forth in the preamble to this Note.
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“Scheduled
Interest Payment Date”
means
[INSERT
FIRST CALENDAR MONTH FOLLOWING ISSUE DATE]
1,
200__ and the first Business Day of each calendar month thereafter until the
date on which the entire principal amount of this Note is paid in full, whether
on the Maturity Date or otherwise.
(b) Terms
Defined in the Loan Agreement.
Any
capitalized term used but not defined herein has the meaning specified in the
Loan Agreement.
(c) Usage.
All
definitions contained in this Note are equally applicable to the singular and
plural forms of the terms defined. The words “hereof”, “herein” and “hereunder”
and words of similar import refer to this Note as a whole and not to any
particular provision of this Note.
2. INTEREST;
PAYMENT.
(a) Interest
Payments.
This
Note shall bear interest on the unpaid principal amount hereof (“Interest”)
at an
annual rate equal to [_____] percent ([ ]%), computed on the basis of a 360-day
year and calculated using the actual number of days elapsed since and including
the Issue Date or the date on which Interest was most recently paid, as the
case
may be, and if not timely paid as provided herein, compounded monthly.
The
Company shall pay accrued Interest (including default interest (if any)) in
arrears (i) on each Scheduled Interest Payment Date and (ii) on any
date
on which the entire or any portion of the principal amount of this Note is
paid.
(b) Maturity.
The
outstanding principal amount of this Note plus all accrued and unpaid Interest
(including default interest (if any)) hereon, plus all other amounts due
hereunder, shall be paid in full on the Maturity Date.
(c) Payment
in Cash.
All
payments on this Note shall be paid in
cash
by wire transfer of immediately available funds.
(d) Default
Interest.
Any
amount of principal, Interest or any other amount that is not paid as and when
due in accordance with this Note shall bear interest until paid at the Default
Interest Rate, compounded monthly.
3. EVENT
OF DEFAULT; ACCELERATION.
In
the
event that an Event of Default or a Change of Control occurs, the Holder shall
have the right, upon written notice to the Company (an “Acceleration
Notice”),
to
(i) accelerate the payment of (x) all unpaid principal amount of this Note,
plus
(y) all
accrued and unpaid Interest (including default interest (if any)) hereon,
plus
(z) all
other amounts due hereunder, and (ii) cause the Company to pay all of the
amounts described in the preceding clause
(i) plus
the
applicable Make-whole Amount in same day funds on the Acceleration Payment
Date
(as defined below). The Acceleration Notice shall specify the date on which
the
amounts described in the preceding sentence shall be paid (the “Acceleration
Payment Date”),
which
date must be at least four (4) Business Days following the Business Day on
which
the Acceleration Notice is delivered to the Company (the “Acceleration
Notice Date”).
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4. PREPAYMENT
BY THE COMPANY.
The
Company may prepay all (but not less than all) of this Note prior to the
Maturity Date by giving written notice thereof to the Holder, which notice
shall
(i) specify the date on which the Company intends to prepay this Note (the
“Prepayment
Date”),
and
(ii) be
delivered to the Holder not less than three (3) Business Days prior to the
Prepayment Date. Any such written notice delivered by the Company shall be
irrevocable. On the Prepayment Date, the Company shall pay to the Holder the
sum
of (w) all unpaid principal amount of this Note, plus
(x) all
accrued and unpaid Interest (including default interest (if any)) hereon,
plus
(y) all
other amounts due hereunder, plus
(z) the
applicable Make-whole Amount in same day funds.
5. MISCELLANEOUS.
(a) Successors
and Assigns.
The
terms and conditions of this Note
shall
inure to the benefit of and be binding upon the respective successors and
permitted assigns of the Company and the Holder. The Company may not assign
its
rights or obligations under this Note
except
as specifically required or permitted pursuant to the terms hereof.
(b) Governing
Law.
This
Note shall be governed by and construed in accordance with the laws of the
State
of New York applicable
to contracts made and to be performed entirely within the State of New
York.
(c) Notices.
Any
notice, demand or request required or permitted to be given by the Company
or
the Holder pursuant to the terms of this Note shall be in writing and shall
be
deemed delivered (i) when delivered personally or by verifiable facsimile
transmission, unless such delivery is made on a day that is not a Business
Day,
in which case such delivery will be deemed to be made on the next succeeding
Business Day, (ii) on the next Business Day after timely delivery to an
overnight courier and (iii) on the Business Day actually received if deposited
in the U.S. mail (certified or registered mail, return receipt requested,
postage prepaid), addressed as follows:
If
to
the Company:
Manaris
Corporation
400
boul.
Montpellier
Montreal,
Quebec
Canada
H4N 2G7
Attn:
Xxxx Xxxxxx, Chief Executive Officer
Tel:
000-000-0000
Fax:
000-000-0000
with
a copy (which
shall not constitute notice) to:
Xxxxxxxxx
Xxxx Xxxxxxxx Xxxxxxx LLP
00
Xxxxxxxx, 00xx
Floor
Attn: Xxxxxx
Xxxxxx, Esq.
Tel: 000-000-0000
Fax: 000-000-0000
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and
if to
the Holder, to such address for the Holder as shall be specified appear on
the
signature page of the Note Purchase Agreement executed by the Holder, or as
shall be designated by the Holder in writing to the Company in accordance this
Section
5(c).
(d)
Amendments.
No (i)
amendment to this Note or (ii) waiver of any agreement or other obligation
of
the Company under this Note may be made or given except pursuant to a written
instrument executed by the Company and by the holders of a majority of the
aggregate principal of the Notes then outstanding, it being understood that
upon
the satisfaction of the preceding condition, this and each other Note (including
any Note held by a holder thereof that did not execute the instrument specified
in the preceding clause) shall be deemed to incorporate any amendment,
modification, change or waiver effected thereby as of the effective date
thereof. Any waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.
(e) Failure
to Exercise Rights not Waiver.
No
failure or delay on the part of the Holder in the exercise of any power, right
or privilege hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise of any such power, right or privilege preclude any other
or
further exercise thereof. All rights and remedies of the Holder hereunder are
cumulative and not exclusive of any rights or remedies otherwise available.
In
the event that the Company does not pay any amount under this Note when such
amount becomes due, the Company shall bear all costs incurred by the Holder
in
collecting such amount, including without limitation reasonable legal fees
and
expenses.
(f)
Transfer
of Note.
The
Holder may sell, transfer or otherwise dispose of all or any part of this Note
(including without limitation pursuant to a pledge) to any person or entity
as
long as such sale, transfer or disposition is made in accordance with the
applicable provisions of the Loan Agreement. From and after the date of any
such
sale, transfer or disposition, the transferee hereof shall be deemed to be
the
holder of a Note in the principal amount acquired by such transferee, and the
Company shall, as promptly as practicable and at the Company’s cost and expense,
issue and deliver to such transferee a new Note identical in all respects to
this Note, in the name of such transferee. The Company shall be entitled to
treat the original Holder as the holder of this entire Note unless and until
it
receives written notice of the sale, transfer or disposition
hereof.
(g)
Lost
or Stolen Note.
Upon
receipt by the Company of evidence of the loss, theft, destruction or mutilation
of this Note, and (in the case of loss, theft or destruction) of indemnity
or
security reasonably satisfactory to the Company, and upon surrender and
cancellation of the Note, if mutilated, the Company shall at the Company’s cost
and expense execute and deliver to the Holder a new Note identical in all
respects to this Note.
(h) Usury.
This
Note
is subject to the express condition that at no time shall the Company be
obligated or required to pay interest hereunder at a rate which could subject
the Holder to either civil or criminal liability as a result of being in excess
of the maximum interest rate which the Company is permitted by applicable law
to
contract or agree to pay. If by the terms of this Note, the Company is at
any time required or obligated to pay interest hereunder at a rate in excess
of
such maximum rate, the rate of interest under this Note shall be deemed to
be
immediately reduced to such maximum rate and the interest payable shall be
computed at such maximum rate and all prior interest payments in excess of
such
maximum rate shall be applied and shall be deemed to have been payments in
reduction of the principal balance of this Note.
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(i) Taxes.
Any and
all payments of any kind whatsoever by the Company under or in connection with
this Note or any other Transaction Document shall be made free and clear of
and
without deduction for any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities of any kind whatsoever
with respect thereto, excluding taxes imposed on the net income of the Holder
(all such nonexcluded taxes, levies, imposts, deductions, charges withholdings
and liabilities, collectively or individually, the “Taxes”).
If
the Company shall be required to deduct any Taxes from or in respect of any
sum
payable under or in connection with any of this Note or any other Transaction
Document to the Holder, (i) the sum payable shall be increased by the amount
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under or in connection with this
Section
5(i))
the
Holder shall receive an amount equal to the sum it would have received had
no
such deductions been made, (ii) the Company shall make such deductions and
(iii)
the Company shall pay the full amount deducted to and file any required tax
and
information return with the relevant Governmental Authority in accordance with
applicable law.
[Signature
Page to Follow]
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IN
WITNESS WHEREOF, the Company has caused this Note to be signed in its name
by
its duly authorized officer on the date first above written.
MANARIS
CORPORATION
By:
Name:
Title:
