THIS NOTE AND THE UNDERLYING COMMON STOCK INTO WHICH THIS NOTE IS CONVERTIBLE
("THE UNDERLYING COMMON STOCK") HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 OR UNDER ANY APPLICABLE STATE LAW. THIS NOTE AND THE UNDERLYING
COMMON STOCK MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR PLEDGED WITHOUT
(1) REGISTRATION UNDER THE SECURITIES ACT OF 1933 AND ANY APPLICABLE STATE LAW,
OR (2) AN OPINION OF COUNSEL (SATISFACTORY TO GRIDLINE COMMUNICATIONS CORP.)
THAT REGISTRATION IS NOT REQUIRED.
8.0% CONVERTIBLE NOTE DUE SEPTEMBER 10, 2005
$___________ ________, 2004
FOR VALUE RECEIVED, Gridline Communications Corp., a corporation duly organized
and existing under the laws of the State of Delaware, having an address of 00000
Xxxxxx Xxxxx Xxxx., Xxxxx 000, Xxxxxxx, Xxxxx 00000 (the "CORPORATION"), hereby
promises to pay to the order of ____________________, having an address of
_________________________________________. (HOLDER"), the principal sum of $
___,000.00 (the "PRINCIPAL AMOUNT") on the 10th day of September, 2005 (the
"MATURITY DATE"), together with interest on the aggregate unpaid principal
amount outstanding at the rate of 8.0% per annum. Interest on the outstanding
principal amount shall accrue from the date hereof and continue up to, but not
including, the date of payment. All accrued and unpaid interest outstanding
shall be payable by the Corporation on the Maturity Date. Interest will be
computed on the outstanding daily principal balance for the actual number of
days that such amount is outstanding hereunder based on a 365-day year.
1. CONVERSION RIGHTS. At any time prior to the Maturity Date and prior to
payment or redemption of this Note, and, in the event that the Corporation
elects to redeem or pay this Note prior to maturity, within ten days after
Xxxxxx's receipt of any redemption or prepayment notice, Holder may at his sole
discretion convert the entire principal amount of this Note, or any portion
thereof, together with accrued and unpaid interest, if any, into shares of
common stock of the Corporation ("COMMON STOCK) at the conversion price of ten
cents ($0.10) per share of Common Stock, subject to adjustments as described
below (the CONVERSION PRICE). The right to convert this Note by Xxxxxx after it
is called for redemption will terminate at the close of the tenth day following
receipt by Xxxxxx of a redemption notice; provided that such period for
Conversion may be extended by the Corporation at its sole and absolute
discretion.
1
Upon conversion of this Note (or any portion thereof) at the election of Holder
pursuant to this SECTION 1, all accrued and unpaid interest relating to the
portion of the Note so converted shall be converted into Common Stock
simultaneously with such conversion. No fractional shares will be issued upon
conversion, but a cash payment will be made for any fractional interest based
upon the conversion price per share of the Common Stock.
2. EXERCISE OF CONVERSION. The Holder may exercise his right of conversion at
any time authorized under SECTION 1 above through the following procedure:
(a) DELIVERY OF CONVERSION NOTICE. Delivery of written notice in the form
annexed hereto as Exhibit A (the "CONVERSION NOTICE), to the Corporation
pursuant to any method authorized under Section 12 hereof prior to the Maturity
Date. The date on which the Conversion Notice is received by the Corporation is
herein called the "CONVERSION DATE"; and
(b) SURRENDER OF ORIGINAL NOTE. Surrender of this original Note to the
Corporation no later than five (5) business days thereafter in exchange for a
share certificate for the appropriate number of shares of Common Stock, and, if
less than the full amount of debt represented by the Note is converted, a
replacement Note representing the balance of the debt which remains outstanding.
Surrender of the Note by the Holder to the Corporation shall be a good and
sufficient discharge to the Corporation, subject to the delivery of a share
certificate for the appropriate number of shares of Common Stock and a
replacement Note for the remaining balance of the debt evidenced by this Note if
less than all amounts then outstanding hereunder are converted.
(c) ORDER OF CONVERSION. In each case in which the Holder elects to convert
a specified portion of this Note into shares of Common Stock, amounts due and
payable under this Note shall be converted in the following order of priority:
all accrued and unpaid interest then due and payable under this Note shall be
first converted, then each scheduled payment shall be converted in the order of
its maturity, with the principal amount of next such payment due first
converted, such that if the Holder converts portions of this Note into Common
Stock, such conversion reduces future payments next due hereunder in the order
of their maturity to the extent of the indebtedness so converted.
3. CONVERTED SHARES. The shares of Common Stock issued upon conversion will be
recorded on the books of the Corporation as of the Conversion Date in the name
of the Holder or its nominee, and will rank pari passu with the issued and fully
paid shares of Common Stock of the Corporation outstanding on the Conversion
Date, and the Holder will accordingly be entitled to any dividends or other
distributions declared, made, or paid on the Common Stock or after such
Conversion Date. The Common Stock issued upon conversion may not be transferred
or sold except pursuant to a transaction registered under the Securities Act of
1933, as amended (the SECURITIES ACT) or pursuant to an exemption therefrom. The
share certificate representing such shares shall bear a restrictive legend
concerning such restrictions on transfer.
4. ADJUSTMENT UPON CONVERSION. The Conversion Price of this Note shall be
adjusted proportionately to compensate for the amount Holder would have received
had Holder converted this Note to Common Stock immediately prior to the
occurrence of the following events:
(a) STOCK DIVIDEND. The issuance of shares of Common Stock as a dividend or
a distribution on the Common Stock;
(b) STOCK SPLIT. The subdivision or combination of the outstanding Common
Stock; and
2
(c) DISTRIBUTIONS OF PROPERTY. The distribution to holders of Common Stock
of shares of capital stock of the Corporation (other than Common Stock), cash,
securities (including securities of the Corporation or any other entity, but not
including the Common Stock in clause (b) above), evidences of indebtedness, or
other non-cash assets which, together with all such distributions to holders of
Common Stock within the preceding 12 months that did not trigger a Conversion
Price adjustment, to the extent such distributions exceed, in the aggregate, an
amount equal to 10% of the book value of the total assets of the Corporation as
of the end of the day preceding the record date for determining shareholders
entitled to receive such distribution.
In the event of a distribution to holders of Common Stock of cash, securities,
evidences of indebtedness, or other non-cash assets, the Corporation may,
instead of making any adjustment in the Conversion Price, make proper provisions
so that each holder who converts a Note (or any portion thereof) after the
record date for such distribution and prior to the expiration or redemption of
such Note shall be entitled to receive upon such conversion, in addition to the
shares of Common Stock issuable upon conversion, an appropriate amount of such
cash, securities, evidences of indebtedness, or other non-cash assets. No
adjustment to the Conversion Price will be required to be made unless the
cumulative effect of such adjustment would result in an increase or decrease of
at least 1.0% in the amount of the Conversion Price as last adjusted.
As a condition precedent to the taking of any action which would require an
adjustment in respect of the Holder's rights under this Note, including the
Conversion Price and the number and classes of shares which are to be received
upon the conversion hereof, the Corporation shall take such corporate action
which may, in the opinion of its counsel, be necessary to enable the Corporation
to validly and legally issue a sufficient number of shares of Common Stock, as
fully paid and non-assessable shares, such that the Holder may receive all of
the Common Stock to which the Holder is entitled in accordance with the
provisions hereof.
Immediately after the occurrence of any event which requires an adjustment in
any of the Holder's rights under this Note, including the Conversion Price and
the number and classes of shares which are to be received upon the conversion
hereof, the Corporation shall forthwith give written notice to the Holder of the
particulars of such event and the required adjustment.
If at any time the Corporation proposes to proceed with any of the events set
forth in subsections (a), (b), and (c) of this Section, or a distribution to
holders of Common Stock of rights to subscribe for additional shares of the
Corporation capital stock (other than those referred to in (c) above, (each
referred to as a "CORPORATE ALTERATION"), and if the holders of shares of Common
Stock are entitled under the Corporation's certificate of incorporation, bylaws
or applicable law to vote in respect of such proposed Corporate Alteration, then
the Corporation shall give to the Holder at least 10 days' prior written notice
of the date on which the books of the Corporation shall close or a record shall
be taken for such Corporate Alteration or for determining rights to vote with
respect to such Corporate Alteration and at least 10 days' prior written notice
of the date when the same shall take place.
In the event of any question arising with respect to the calculation of any
adjustments herein provided for, such question shall be conclusively determined
by the Corporation's board of directors, acting in good faith and with the
advice of such professionals as it may deem advisable and such determination
shall be binding upon the Holder.
3
5. RIGHT OF REPAYMENT.
(a) RANKING. This Note is unsecured as to payment of principal and interest,
and ranks pari passu with all other unsecured unsubordinated indebtedness of the
Corporation.
(b) NO SINKING FUND. No sinking fund is provided for this Note.
(c) NO LIMITATION ON SENIOR INDEBTEDNESS. This Note does not limit the
Corporation's ability to incur indebtedness senior to the Notes or any other
indebtedness.
(d) NO SHAREHOLDER VOTING RIGHTS. This Note does not entitle Holder to any
voting or other rights as a shareholder of the Corporation, or other rights
whatsoever except those herein expressed. No dividends are payable or will
accrue on this Note or the shares purchasable hereunder until, and except to the
extent that, the Note is converted into Common Stock.
6. CORPORATION REDEMPTION RIGHTS. This Note may be redeemed at any time, in
whole or in part, at the option of the Corporation, upon not less than 10 nor
more than 60 days prior written notice, delivered by the Corporation to the
Holder as provided in Section 12 herein (the "REDEMPTION NOTICE"), at the cash
redemption price of 105% of the outstanding principal amount of this Note called
to be redeemed, together with all outstanding accrued and unpaid interest
thereon (the "REDEMPTION PRICE").
7. REDEMPTION PROCESS. The Corporation may exercise its right of redemption by
giving the Redemption Notice to the Holder, setting forth the intention of the
Corporation to redeem all or any part of the outstanding Note on a date
("REDEMPTION DATE) no less than 10 nor more than 60 days following the date of
the Redemption Notice. Delivery of payment of the redemption amount in United
States funds to the Holder on the Redemption Date shall be a good and sufficient
discharge to the Corporation of the debt evidenced by this Note or of any lesser
amount redeemed and, if less than the full amount of debt represented by the
Note is redeemed, the Corporation shall deliver to the Holder a replacement Note
representing the balance of the debt which remains outstanding. Delivery of the
Redemption Notice shall not impede the right of the Holder to convert this Note
pursuant to its terms at any time prior to the close of business on the tenth
day following receipt by Holder of a Redemption Notice; provided that such
period for Conversion may be extended by the Corporation at its sole and
absolute discretion.
8. MERGERS AND SALES OF ASSETS BY THE CORPORATION. The Corporation may not
consolidate or merge with or into any other entity (PERSON") or directly, or
indirectly, convey, transfer, sell, lease or otherwise dispose of its properties
and assets substantially as an entirety to any Person, and the Corporation may
not permit any Person to consolidate or merge with or into the Corporation or
convey transfer, sell, lease or otherwise dispose of such Person's properties
and assets substantially as an entirety to the Corporation, unless:
4
(a) ASSUMPTION OF OBLIGATION UNDER THIS NOTE. The Person formed by such
consolidation or into or with which the Corporation is merged or the Person to
which the properties and assets of the Corporation are so conveyed, transferred,
sold, leased or otherwise disposed of is a corporation, limited liability
corporation, partnership or trust organized and existing under the laws of the
United States, any state thereof or the District of Columbia and has expressly
assumed the due and punctual payment of the principal of, premium, if any, and
interest on this Note and the performance of the other covenants of the
Corporation under this Note;
(b) NO EVENT OF DEFAULT. Immediately after giving effect to such
transaction, no Event of Default, as defined below, and no event which, after
notice or lapse of time or both, would become an Event of Default, shall have
occurred and be continuing; and
(c) COMPLIANCE CERTIFICATE OR OPINION. The Corporation has provided to the
Holder an officer's certificate or an opinion of counsel stating that the
Corporation is in compliance with (a) and (b) above.
9. REPRESENTATIONS AND WARRANTIES. The Corporation represents and warrants to
Holder that:
(a) ORGANIZATION, QUALIFICATION, STANDING. The Corporation is a corporation
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation, has the corporate power to own its properties and
to carry on its businesses as the same are now being conducted and is duly
qualified to do business and is in good standing in each jurisdiction in which
the character of the properties owned by it or the nature of its businesses
makes such qualification necessary.
(b) LITIGATION. There is no action, suit or proceeding at law or in equity
or by or before any governmental instrumentality or agency or any arbitrator now
pending or, to the Corporation's knowledge, threatened, against, or affecting
the Corporation, or any of its properties or rights, which, if adversely
determined, might, either in any case or in the aggregate result in a material
adverse change, or result in any substantial liability not adequately covered by
insurance, or for which adequate reserves are not maintained on the
Corporation's balance sheet.
(c) DUE AUTHORIZATION AND COMPLIANCE WITH OTHER INSTRUMENTS. This Note has
been duly and validly authorized by all requisite corporate proceeding and
constitutes a valid and legally binding obligation of the Corporation
enforceable against the Corporation in accordance with its terms except as
enforceability is limited by bankruptcy, insolvency, reorganization, moratorium,
or other laws relating to or affecting generally the enforcement of creditors'
rights and except to the extent that availability of equitable remedies are
subject to the discretion of courts before which any proceeding therefor may be
brought.
(d) TAX RETURNS AND PAYMENTS. The Corporation has filed all required
information and tax returns and reports and has paid, or adequately provided for
the payment of, all taxes, assessments and other governmental charges that are
material in amount imposed upon it or upon any of its assets, income or
franchises, other than any such charges which are currently payable without
penalty or interest.
5
10. HOLDER REPRESENTATIONS.
(a) INVESTMENT PURPOSES. The Holder is acquiring the Note for investment
purposes and not with a view to the resale or distribution of all or any part
thereof. The Holder acknowledges that the Note has not been registered under the
Securities Act, or the securities or "blue sky" laws of any state or other
domestic or foreign jurisdiction and that none of such securities may be sold,
transferred or otherwise disposed of except pursuant to an effective
registration statement thereunder or an applicable exemption therefrom.
(b) ACCREDITED INVESTOR. The Holder (i) has such knowledge and experience
in financial and business matters that such Xxxxxx is capable of evaluating the
merits and risks of his or her investment in the Note and has the financial
ability to assume the monetary risk associated therewith; (ii) is able to bear
the complete loss of his or her investment in the Note; has received such
documents and information from the Corporation as such Xxxxxx has requested and
has had the opportunity to ask questions of and receive answers from the
Corporation and the terms and conditions of the offering of the notes and to
obtain additional information; (iv) is an "accredited investor" as defined in
Rule 501(a) of Regulation D promulgated under the Securities Act; and (v) is not
relying upon any statements or instruments made or issued by any person other
than the Corporation in making a decision to invest in the Note.
(c) RESTRICTIVE LEGENDS. Any certificate for Common Stock issued upon
conversion of the Note and each certificate for Common Stock issued to a
subsequent transferee shall be stamped or otherwise imprinted with a legend in
substantially the following form:
"The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended ("Securities Act") or any
state securities act. The securities have been acquired for investment and
may not be sold, transferred, pledged or hypothecated unless (i) they shall
have been registered under the Securities Act and any applicable state
securities act, or (ii) the corporation shall have been furnished with an
opinion of counsel, satisfactory to counsel for the corporation, that
registration is not required under any such act."
11. EVENTS OF DEFAULT. The following will be Events of Default" under this
Note:
(a) failure to pay the principal or the redemption price of this Note when
and as the same shall become due and payable, either at maturity or by
acceleration or otherwise and such failure shall continue uncured for a period
of ten (10) days after written notice from the Holder of such failure;
(b) failure to pay any interest on this Note when due when the same becomes
due and payable and such failure shall continue uncured for a period of ten (10)
days after written notice from the Holder of such failure;
(c) failure to perform any other covenant of the Corporation in this Note,
continuing for a period of thirty (30) days after written notice from the Holder
of such failure;
6
(d) default shall be made if a material breach shall exist in any
representation or warranty herein contained, and such default or material breach
shall have continued for a period of 30 days after written notice thereof to the
Corporation from the Holder; PROVIDED, HOWEVER, that if any such default or
material breach shall be such that it cannot be cured or corrected within such
30-day period, such period shall be extended for such additional period of time
(not exceeding 30 additional days) as shall be necessary to effect such cure or
correction if curative or corrective action is instituted within said 30-day
period and thereafter diligently pursued;
(e) final unsatisfied judgments not covered by insurance aggregating in
excess of $250,000, at any one time rendered against the Corporation or any of
its subsidiaries and not stayed, bonded or discharged within 30 days, or
(g) if the Corporation (i) applies for or consents to the appointment of,
or if there shall be a taking of possession by, a receiver, custodian, trustee
or liquidator for the Corporation or any of its properties; (ii) becomes
generally unable to pay its debts as they become due; (iii) makes a general
assignment for the benefit of creditors or becomes insolvent; or (iv) files any
petition for relief under the United States Bankruptcy Code or any similar
federal or state statute, or is served with a petition for relief under any such
statute and such petition is not dismissed within 60 days of filing.
At any time after a declaration of acceleration has been made but before a
judgment or decree based on acceleration, the holder of the Note may rescind and
annul such acceleration, if all Events of Default, other than the nonpayment of
accelerated principal and interest, have been cured or waived as provided in
this Note.
12. NOTICES. Any notice, demand or other communication required or permitted to
be given to the Corporation or the Holder shall be in writing and shall be:
(a) HAND DELIVERY. Personally delivered to the Corporation or the Holder or
any director or officer of the Corporation or the Holder;
(b) DELIVERY BY MAIL. Except during a period of strike, lock-out or other
postal disruption, sent by registered mail, postage prepaid to the address of
the Corporation or the Holder as set forth on the first page hereof; or
(c) TELECOPIER. Sent by telegraph, telecopier or telex or similar
communication tested prior to sending and confirmed by prepaid registered or
certified mail to the address of the Corporation or the Holder as set forth on
the first page hereof;
and, in each case described above, shall be deemed to have been received by the
Corporation or the Holder on the earliest of: the date of delivery under
subsection (a); the actual date of receipt where mailed under subsection (b);
and the day following the date of communication under subsection (c) unless
delivered by certified mail, in which case the actual date of receipt shall
apply. The Corporation or the Holder may give written notice to the other of a
change of address to some other address, in which event any communication shall
thereafter be given to the Corporation or the Holder as hereinbefore provided,
at the last such changed address of which the Corporation or the Holder
communicating has received written notice.
7
13. ATTORNEYS FEES. Should the indebtedness represented by this Note or any
part thereof be collected at law or in equity, or in bankruptcy, receivership or
any other court proceedings (whether at the trial or appellate level), or should
this Note be placed in the hands of attorneys for collection upon the occurrence
of an Event of Default, the Corporation agrees to pay, in addition to the
principal and interest due and payable hereon, all costs of collection,
including reasonable attorneys' fees.
14. NON-TRANSFERABLE NOTE. This Note is not transferable in any manner, in
whole or in part, without the prior written consent of the Corporation, except
by operation of law.
15. WAIVER. Prior to the transfer of this Note, the Corporation may deem and
treat the Holder hereof as the absolute owner hereof (whether or not this Note
shall be overdue) for the purpose of receiving payment of or on account of the
principal hereof and interest hereon, and for all other purposes, and the
Corporation shall not be affected by any Notice to the contrary.
Except as expressly provided for herein, the Corporation hereby waives
presentment, demand, Notice of demand, Notice of intent to accelerate, notice of
acceleration, protest, notice of protest and Notice of dishonor and any other
Notice required to be given by law in connection with the delivery, acceptance,
performance, default or enforcement.
16. SAVINGS CLAUSE. In the event for any reason, any payment by or act of the
Corporation or the Holder shall result in payment of interest which would exceed
the limit authorized by or be in violation of the law of the jurisdiction
applicable to this Note, then IPSO FACTO the obligation of the Corporation to
pay interest or perform such act or requirement shall be reduced to the limit
authorized under such law, so that in no event shall the Corporation be
obligated to pay any such interest, perform any such act or be bound by any
requirement which would result in the payment of interest in excess of the limit
so authorized. In the event any payment by or act of the Corporation shall
result in the extraction of a rate of interest in excess of a sum which is
lawfully collectible as interest, then such amount (to the extent of such excess
not returned to the Corporation) shall, without further agreement or notice
between or by the Corporation or the Holder, be deemed applied to the payment of
principal, if any, hereunder immediately upon receipt of such excess funds by
the Holder, with the same force and effect as though the Corporation had
specifically designated such sums to be so applied to principal and the Holder
had agreed to accept such sums as an interest-free prepayment of this Note. If
any part of such excess remains after the principal has been paid in full,
whether by the provisions of the preceding sentences of this Section 13 or
otherwise, such excess shall be deemed to be an interest- free loan from the
Corporation to the Holder, which loan shall be payable immediately upon demand
by the Corporation. The provisions of this Section 13 shall control every other
provision of this Note.
17. RECOURSE. No recourse shall be had for the payment of the principal of or
the interest on this Note, against any agent, incorporator, shareholder, officer
or director, as such, past, present or future, of the Corporation or of any
successor corporation, all such liability being, by the acceptance hereof and as
part of the consideration for the issue hereof, expressly waived and released.
The preceding sentence shall not be deemed to apply to any person's liability
arising out of or related to any conversion of the Corporation's assets or
properties, breach of fiduciary duty owed to the Corporation or fraud
perpetrated on the Corporation or its shareholders.
8
18. GOVERNING LAW. This Note and the rights, remedies, powers, covenants,
duties and obligations of the parties hereunder will be construed in accordance
with and governed by the laws of the state of Texas.
19. SEVERABILITY. If any provision of this Note is or becomes invalid, illegal
or unenforceable in any respect, that fact will not affect the validity,
legality or enforceability of the remaining provisions of this Note or any
valid, legal or enforceable parts of the impugned provision.
20. BINDING ON SUCCESSORS. This Note will inure to the benefit of and be
binding upon the Corporation and the Holder and their respective heirs,
executors, administrators, successors and permitted assigns.
21. AMENDMENT AND WAIVER. This Note may not be amended, waived, discharged or
terminated except by a document executed by the party against whom enforcement
of the amendment, waiver, discharge or termination is sought.
22. ENTIRE AGREEMENT. This Note sets out the entire agreement and understanding
of the Corporation and the Holder and supersedes all prior agreements,
undertakings and understandings, whether oral or written, relative thereto.
IN WITNESS WHEREOF, Gridline Communications Corp. has caused this Note to be
signed by its President on the date first above written.
Gridline Communications Corp.
By:__________________________
Xxxxxx X. Xxxxxx
President and Chief Executive Officer
EXHIBIT A
NOTICE OF CONVERSION BY HOLDER
OF
8% CONVERTIBLE NOTE
(To be Executed by the Registered Holder in Order to Convert the Note)
TO: Gridline Communications Corp.
00000 Xxxxxx Xxxxx Xxxx., Xxxxx 000,
Xxxxxxx, Xxxxx 00000
Facsimile: _______________ Attn: President
FROM: ________________________________________________________________("Holder")
DATE: ___________________________________________________(the "Conversion Date")
RE: Conversion of $__________ principal amount plus $___________ of accrued and
unpaid interest (collectively, the "Converted Note") of the 8% Convertible
Note dated _____________, 2003 (the "Note") of GRIDLINE COMMUNICATIONS
CORP. (the "Corporation") into shares (the "Conversion Shares") of the
Company's common stock, $0.001 par value (the "Common Stock").
CONVERSION DATE:
The captioned Holder hereby gives notice to the Company, pursuant to
the Note, that the Holder elects to convert the Converted Note into fully paid
and non-assessable shares of Common Stock as of the Conversion Date specified
above.
--------------------------------------------------------------------------------
Amount Conversion
Currently Amount Shares
Outstanding To be Converted To be Issued
--------------------------------------------------------------------------------
Principal Balance
--------------------------------------------------------------------------------
Interest Balance (Accrued
and unpaid through
Conversion Date)
--------------------------------------------------------------------------------
Total
--------------------------------------------------------------------------------
Based on the Conversion Price now in effect, the number of Conversion Shares
indicated above should be issued in the following name(s):
Name and Record Address
-------------------------------------
-------------------------------------
-------------------------------------
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As contemplated by the Note, this Notice of Conversion is being sent by
facsimile to the telecopier number or otherwise delivered to the officer
indicated above.
If this Notice of Conversion represents the full conversion of the
outstanding principal and interest of the Note, the Holder either (1) has
previously surrendered the Note, duly endorsed, to the Company or (2) will
surrender (or cause to be surrendered) the Note, duly endorsed, to the Company
at the address indicated above by express courier within five (5) business days
after delivery or facsimile transmission of this Notice of Conversion.
The certificates representing the Conversion Shares should be transmitted
by the Company to the Holder via overnight or express courier or by book entry
transfer within the time contemplated by the Note after receipt of this Notice
of Conversion (by facsimile transmission or otherwise), to:
------------------------------------------
------------------------------------------
------------------------------------------
HOLDER:
-----------------------------------------------------
By:
-----------------------------------------------
Name:
---------------------------------------------
Title:
--------------------------------------------
11
