FORM OF NOTE
Exhibit
10.2
ANNEX
I
TO
(PROTOTYPE
FOR EACH ISSUANCE)
FORM
OF NOTE
THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD OR OFFERED
FOR
SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
OR
AN OPINION OF COUNSEL OR OTHER EVIDENCE ACCEPTABLE TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED.
No. 07-02-
1
US
$__________2
RIM
SEMICONDUCTOR COMPANY
SENIOR
SECURED PROMISSORY NOTE DUE DECEMBER ____, 20073
THIS
NOTE is one of a duly authorized
issue of up to $1,100,000 of RIM SEMICONDUCTOR COMPANY, a corporation organized
and existing under the laws of the State of Utah (the "Company"), designated
as
its Senior Secured Promissory Note Series 07-02.
FOR
VALUE RECEIVED, the Company
promises to pay to ___________________ , the registered holder
hereof (the "Holder"), the principal sum of ___________Thousand
____________ and 00/100 Dollars (US $________)4 on the Maturity Date (as defined
below).
TIME
IS OF THE ESSENCE WITH RESPECT
TO THE COMPANY’S FULFILLMENT OF ALL OF ITS PAYMENT OBLIGATIONS
HEREUNDER. The Holder shall not be required to give the Company
any notice of default of payment if any such payment is not timely paid or
otherwise satisfied. All provisions of this Note which apply in the
event of the Company’s not timely fulfilling any of its payment obligations
hereunder shall apply whether or not such notice of default is
given. The Holder’s giving of any notice to the Company shall not be
deemed a waiver, modification or amendment of this provision with respect to
the
failure referred to in that notice or to any other failure by the Company timely
to make any other payment due hereunder.
1
This
Note or its predecessor was
originally issued on July ___, 20075
(the “Issue Date”).
This
Note is being issued pursuant to
the terms of the Bridge Loan Agreement, dated as of July 26, 2007 (the “Bridge
Loan Agreement”), to which the Company and the Holder (or the Holder’s
predecessor in interest) are parties. Capitalized terms not otherwise
defined herein shall have the meanings ascribed to them in the Bridge Loan
Agreement.
This
Note
is subject to the following additional provisions:
1. The
Note will initially be issued in denominations determined by the Company, but
are exchangeable for an equal aggregate principal amount of Note of different
denominations, as requested by the Holder surrendering the same. No
service charge will be made for such registration or transfer or
exchange.
2. No
interest will accrue on this Note until the Maturity Date. If any
portion of this Note is outstanding on the Maturity Date, interest at the rate
of twenty-four percent (24%) per annum or the highest rate allowed by law,
whichever is lower, shall accrue on the outstanding principal of this Note
from
the Maturity Date to and including the date of payment by the
Company. Such interest shall accrue on a daily basis and shall be
payable in cash. The Holder may demand payment of all or any part of this Note,
together with accrued interest, if any, and any other amounts due hereunder,
as
of the Maturity Date or any date thereafter.
3. The
Company shall be entitled to withhold from all payments of principal of, and,
if
applicable, interest on, this Note any amounts required to be withheld under
the
applicable provisions of the United States income tax laws or other applicable
laws at the time of such payments, and Holder shall execute and deliver all
required documentation in connection therewith.
2
4. This
Note has been issued subject to investment representations of the original
purchaser hereof and may be transferred or exchanged only in compliance with
the
Securities Act of 1933, as amended (the "Act"), and other applicable state
and
foreign securities laws and the terms of the Bridge Loan
Agreement. In the event of any proposed transfer of this Note, the
Company may require, prior to issuance of a new Note in the name of such other
person, that it receive reasonable transfer documentation that is sufficient
to
evidence that such proposed transfer complies with the Act and other applicable
state and foreign securities laws and the terms of the Bridge Loan
Agreement. Prior to due presentment for transfer of this Note, the
Company and any agent of the Company may treat the person in whose name this
Note is duly registered on the Company's Note Register as the owner hereof
for
the purpose of receiving payment as herein provided and for all other purposes,
whether or not this Note be overdue, and neither the Company nor any such agent
shall be affected by notice to the contrary.
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(a) The
term “Maturity Date” means the earliest of (i) December ____, 20076 (the “Stated Maturity Date”), (ii) the New
Transaction Threshold Date (as defined below), or (iii) the Default Maturity
Date (as defined below).
(b) The
term “New Transaction Threshold Date” means the date on which the Company
consummates the first New Transaction in which the Company receives, on a
cumulative basis after taking into account the gross proceeds from all prior
New
Transactions, if any, after the Issue Date, gross proceeds of at least Three
Million Dollars ($3,000,000). All such gross proceeds are determined
before deduction of any fees or other expenses or disbursements of any kind
in
connection with the relevant New Transaction.
6.
(a) Any
payment made on account of this Note shall be applied in the following order
of
priority: (i) first, to any amounts due hereunder other than principal and
accrued interest, (ii) then, to accrued interest, if any, through and including
the date of payment, and (iii) then, to principal of this Note.
(b) Subject
to the provisions of Section 6(a) hereof, the outstanding principal of this
Note
may be prepaid in whole or in part at the option of the Company at any time
prior to the Maturity Date.
6See
fn 3.
3
7. All
payments contemplated hereby are to be made “in cash” and shall be made in
immediately available good funds of United States of America currency by wire
transfer to an account designated in writing by the Holder to the Company (which
account may be changed by notice similarly given). For purposes of
this Note, the phrase “date of payment” means the date good funds are received
in the account designated by the notice which is then currently
effective.
8. (a) Subject
to the terms of the Bridge Loan Agreement, no provision of this Note shall
alter
or impair the obligation of the Company, which is absolute and unconditional,
to
pay the principal of, and, if applicable, interest on, this Note at the time,
place, and rate, and in the coin or currency, as herein
prescribed. This Note is a direct obligation of the
Company.
(b) Payment
of this Note is secured pursuant to the terms of the Security Interest
Agreement, dated the Issue Date (the “Security Interest Agreement”), executed by
the Company, as debtor, in favor of the Lender, as secured party. The
terms of the Security Interest Agreement are incorporated herein by
reference.
9. No
recourse shall be had for the payment of the principal of, or, if applicable,
the interest on, this Note, or for any claim based hereon, or otherwise in
respect hereof, against any incorporator, shareholder, officer or director,
as
such, past, present or future, of the Company or any successor corporation,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such liability being,
by the acceptance hereof and as part of the consideration for the issue hereof,
expressly waived and released.
10. The
Holder of the Note, by acceptance hereof, agrees that this Note is being
acquired for investment and that such Holder will not offer, sell or otherwise
dispose of this Note except under circumstances which will not result
in a violation of the Act or any applicable state Blue Sky or foreign laws
or
similar laws relating to the sale of securities.
4
11. Any
notice required or permitted hereunder shall be given in manner provided in
the
Section headed "NOTICES" in the Bridge Loan Agreement, the terms of which are
incorporated herein by reference.
12. (a) This
Note shall be governed by and interpreted in accordance with the laws of the
State of Delaware for contracts to be wholly performed in such state and without
giving effect to the principles thereof regarding the conflict of
laws. Each of the parties consents to the exclusive jurisdiction of
the federal courts whose districts encompass any part of the City of Wilmington
or the state courts of the State of Delaware sitting in the City of Wilmington
in connection with any dispute arising under this Note and hereby waives, to
the
maximum extent permitted by law, any objection, including any objection based
on forum non conveniens, to the bringing of any such proceeding in such
jurisdictions. To the extent determined by such court, the Company shall
reimburse the Holder for any reasonable legal fees and disbursements incurred
by
the Holder in enforcement of or protection of any of its rights under this
Note.
(b) JURY
TRIAL WAIVER. The Company and the Holder hereby waive a
trial by jury in any action, proceeding or counterclaim brought by either of
the
Parties hereto against the other in respect of any matter arising out of or
in
connection with this Note.
13. (a) The
following shall constitute an "Event of Default":
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i.
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The
Company shall default in the timely payment of principal on this
Note or
any other amount due hereunder (without the requirement of any further
notice with respect thereto from the Holder);
or
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ii.
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Any
of the representations or warranties made by the Company herein,
in the
Bridge Loan Agreement or any of the other Transaction Agreements
shall be
false or misleading in any material respect at the time made;
or
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iii.
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The
Company shall fail to perform or observe, in any material respect,
any
other covenant, term, provision, condition, agreement or obligation
of any
Note in this series and such failure shall continue uncured for a
period
of thirty (30) days after the Company’s receipt of written notice thereof
from the Holder; or
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iv.
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The
Company shall fail to perform or observe, in any material respect,
any
covenant, term, provision, condition, agreement or obligation of
the
Company under any of the Transaction Agreements and such failure
shall
continue uncured for a period of thirty (30) days after the Company’s
receipt of written notice thereof from the Holder;
or
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v.
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The
Company shall (1) admit in writing its inability to pay its debts
generally as they mature; (2) make an assignment for the benefit
of
creditors or commence proceedings for its dissolution; or (3) apply
for or
consent to the appointment of a trustee, liquidator or receiver for
its or
for a substantial part of its property or business;
or
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vi.
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A
trustee, liquidator or receiver shall be appointed for the Company
or for
a substantial part of its property or business without its consent
and
shall not be discharged within sixty (60) days after such appointment;
or
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vii.
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Any
governmental agency or any court of competent jurisdiction at the
instance
of any governmental agency shall assume custody or control of the
whole or
any substantial portion of the properties or assets of the Company
and
shall not be dismissed within sixty (60) days thereafter;
or
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viii.
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Any
money judgment, writ or warrant of attachment, or similar process
in
excess of Seven Hundred Fifty Thousand ($750,000) Dollars in the
aggregate
shall be entered or filed against the Company or any of its properties
or
other assets and shall remain unpaid, unvacated, unbonded or unstayed
for
a period of sixty (60) days or in any event later than five (5) days
prior
to the date of any proposed sale thereunder;
or
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ix.
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Bankruptcy,
reorganization, insolvency or liquidation proceedings or other proceedings
for relief under any bankruptcy law or any law for the relief of
debtors
shall be instituted by or against the Company and, if instituted
against
the Company, shall not be dismissed within sixty (60) days after
such
institution or the Company shall by any action or answer approve
of,
consent to, or acquiesce in any such proceedings or admit the material
allegations of, or default in answering a petition filed in any such
proceeding.
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(b) If
an Event of Default shall have occurred and is continuing, then, or at any
time
thereafter, and in each and every such case, unless such Event of Default shall
have been cured or waived in writing by the Holder (which waiver shall not
be
deemed to be a waiver of any subsequent default) (the period during which such
Event of Default shall be continuing until such cure or waiver, the “Default
Period”),
(i)
at
the option of the Holder and in the Holder's sole discretion, the Holder may
consider this Note immediately due and payable (and the Maturity Date shall
be
accelerated accordingly; the “Default Maturity Date”), without presentment,
demand, protest or notice of any kinds, all of which are hereby expressly
waived, anything herein or in any note or other instruments contained to the
contrary notwithstanding, and the Holder may immediately enforce any and all
of
the Holder's rights and remedies provided herein or any other rights or remedies
afforded by law, including, but not necessarily limited to, the equitable remedy
of specific performance and injunctive relief; and
(ii)
the
terms of Appendix I to this Note shall be effective.
[Balance
of page intentionally left blank]
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14. In
the event for any reason, any payment by or act of the Company 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 Company 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 Company 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 Company 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 Company)
shall, without further agreement or notice between or by the Company 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 Company 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 or otherwise, such excess shall be
deemed to be an interest-free loan from the Company to the Holder, which loan
shall be payable immediately upon demand by the Company. The
provisions of this Section shall control every other provision of this
Note.
Dated:
_________________, 2007
RIM
SEMICONDUCTOR COMPANY
By:_______________________________________
__________________________________________
(Print
Name)
__________________________________________(Title)
8
APPENDIX
I
TO
RIM
SEMICONDUCTOR COMPANY
SENIOR
SECURED PROMISSORY NOTE SERIES 07-02
Capitalized
terms not otherwise defined herein shall have the meanings ascribed to them
in
the Bridge Loan Agreement or in the Note.
1. A.
(i) For purposes of this Appendix, the following terms shall have the
meanings indicated below:
“Conversion
Price” means the amount equal to (x) the average Closing Price for the five (5)
Trading Days ending on the Trading Day immediately before the Conversion Date,
multiplied by (y) seventy-five percent (75%); provided, however, that the
Conversion Price shall in no event be less than $0.01.
“Closing
Price” means the 4:00 P.M. closing bid price of the Common Stock on the
Principal Trading Market on the relevant Trading Day(s), as reported by the
Reporting Service for the relevant date(s).
“Reporting
Service” means Bloomberg LP or if that service is not then reporting the
relevant information regarding the Common Stock, a comparable reporting service
of national reputation selected by a Majority in Interest of the Holders and
reasonably acceptable to the Company.
(d) “Majority
in Interest of the Holders” means, as of the relevant date, one or more Holders
whose respective outstanding principal amounts of the Notes of this Series
held
by each of them, as of such date, aggregate more than fifty percent (50%) of
the
aggregate outstanding principal amounts of the outstanding Notes of this Series
held by all Holders on that date.
(ii) At
any time during the
Default Period and prior to the date this Note is paid in full in accordance
with its terms, the Holder of this Note is entitled, at its option, subject
to
the following provisions of this Appendix I, to convert the principal
and the accrued interest, if any, of this Note into shares of Common Stock,
$0.001 par value ("Common Stock"), of the Company at the Conversion
Price.
1
B. Conversion
shall be effectuated by faxing a Notice of Conversion (as defined below) to
the
Company as provided in this paragraph. The Notice of Conversion shall
be executed by the Holder of this Note and shall evidence such Holder's
intention to convert this Note or a specified portion hereof in the form annexed
hereto as Exhibit A. No fractional shares of Common Stock or scrip representing
fractions of shares will be issued on conversion, but the number of shares
issuable shall be rounded to the nearest whole share. The date on
which notice of conversion is given (the "Conversion Date") shall be deemed
to
be the date on which the Holder faxes or otherwise delivers the conversion
notice ("Notice of Conversion") to the Company so that it is received by the
Company on or before such specified date, provided that, if such conversion
would convert the entire remaining principal of this Note, the Holder shall
deliver to the Company the original Note being converted no later than five
(5)
Trading Days thereafter. Delivery of the Notice of Conversion shall
be accepted by the Company by hand, mail or courier delivery at the address
specified in said Exhibit A or at the facsimile number specified in said Exhibit
A (each of such address or facsimile number may be changed by notice given
to
the Holder in the manner provided in the Bridge Loan
Agreement). Certificates representing Common Stock upon conversion
(“Conversion Certificates”) will be delivered to the Holder at the address
specified in the Notice of Conversion (which may be the Holder’s address for
notices as contemplated by the Bridge Loan Agreement or a different
address), via express courier, by electronic transfer or otherwise,
within three (3) Trading Days (such third Trading Day, the “Delivery Date”)
after the relevant Conversion Date. The Holder shall be deemed to be
the holder of the shares issuable to it in accordance with the provisions of
this paragraph (B) on the Conversion Date.
C. Notwithstanding
any other provision hereof or of any of the other Transaction Agreements, in
no
event (except (i) as specifically provided herein as an exception to this
provision, or (ii) while there is outstanding a tender offer for any or all
of
the shares of the Company’s Common Stock) shall the Holder be entitled to
convert any portion of this Note, or shall the Company have the obligation
to
convert such Note to the extent that, after such conversion or issuance of
stock
in payment of interest, the sum of (1) the number of shares of Common Stock
beneficially owned by the Holder and its affiliates (other than shares of Common
Stock which may be deemed beneficially owned through the ownership of the
unconverted portion of the Note or other convertible securities or of the
unexercised portion of warrants or other rights to purchase Common Stock),
and
(2) the number of shares of Common Stock issuable upon the conversion of the
Notes with respect to which the determination of this proviso is being made,
would result in beneficial ownership by the Holder and its affiliates of more
than 4.99% of the outstanding shares of Common Stock (after taking into account
the shares to be issued to the Holder upon such conversion). For
purposes of the proviso to the immediately preceding sentence, beneficial
ownership shall be determined in accordance with Section 13(d) of the Securities
Exchange Act of 1934, as amended, except as otherwise provided in clause (1)
of
such sentence. Nothing herein shall preclude the Holder from
disposing of a sufficient number of other shares of Common Stock beneficially
owned by the Holder so as to thereafter permit the continued conversion of
this
Note.
2
D. (i) No
later than the thirtieth day of the Default Period (such day the “Required
Filing Date”), the Company shall prepare and file with the SEC a Registration
Statement registering for resale by the Holder all Conversion Shares
(“Registrable Securities”). Notwithstanding the requirement to
register all Registrable Securities, the Company’s obligation to register the
Registrable Securities shall initially be satisfied by the registration of
the
Initial Number of Shares to Be Registered (as defined below). The
“Initial Number of Shares to Be Registered” is a number of shares of Common
Stock which is at least equal to the sum of two hundred percent (200%) of the
number of shares into which the Note and all interest thereon for one year
from
the commencement of the Default Period would be convertible at the
time of filing of such Registration Statement (assuming for such purposes that
the Note had been eligible to be converted, and had been converted, into
Conversion Shares in accordance with its terms, whether or not such eligibility,
accrual of interest or conversion had in fact occurred as of such date) based
on
the Conversion Price in effect on, or within three (3) Trading Days prior to,
the date the Registration Statement is filed (or subsequently amended). Unless
otherwise specifically agreed to in writing in advance by the Holder, the
Registration Statement shall not restrict or limit the prices at which the
shares sold by the selling stockholders thereunder may be sold and shall also
state that, in accordance with Rule 416 and 457 under the Securities Act, it
also covers such indeterminate number of additional shares of Common Stock
as
may become issuable upon conversion of the Note to prevent dilution resulting
from stock splits, stock dividends or similar transactions.
(ii) The
Company will use its reasonable best efforts to cause such Registration
Statement to be declared effective on a date (the “Required Effective Date”)
which is no later than the earlier of (X) five (5) days after oral or written
notice by the SEC that it may be declared effective or (Y) the ninetieth day
after the Closing Date.
(iii) If
(X) the Company does not file the Registration Statement by the Required Filing
Date and/or (Y) for any reason, the Registration Statement is not
declared effective by the Required Effective Date and/or (Z) the Company does
not maintain the effectiveness of such Registration Statement for at least
two
years or the earlier date on which the Note has been fully paid or converted
and
all Conversion Shares have been sold, the Company will pay the Holder in cash
an
amount equal to 1.85185% of the outstanding principal amount of the Note of
the
Holder for each 30 day period (prorated for partial periods) until such filing,
such effective date or such effectiveness is re-established, as the
case may be. The outstanding principal amount of the Note shall be
determined as of the close of business on the last day preceding the first
day
of each such 30-day period. The parties acknowledge that the damages which
may
be incurred by the Holder in those events may be difficult to
ascertain. The parties agree that the amounts payable pursuant to the
foregoing provisions of this Section 1(D) are liquidated damages and represent
a
reasonable estimate on the part of the parties, as of the Issue Date, of the
amount of such damages.
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2. (a) The
term “Lower Price Transaction” means a New Transaction offered or consummated
during the New Transaction Period (as defined below), where the lowest New
Transaction Price (as defined below) is, or by its terms or by an existing
understanding of the Company and the New Investor, could subsequently be
adjusted or revised to be, lower than the then effective Conversion Price of
the
Note (such Conversion Price, in each case, subject to adjustment in the same
manner as the initial Exercise Price of the Warrant is adjusted, other than
as a
result of the application of this Section 2 of Appendix I).
(b) “New
Transaction Price” means the Basic New Transaction Price (as defined below)
except that if the New Transaction Exercise Price is lower than the Basic New
Transaction Price, it means the New Transaction Exercise Price.
(c) “Basic
New Transaction Price” means, as may be applicable, on a per share basis, the
lower of (1) the lowest fixed purchase price of any shares of the New Common
Stock contemplated in the New Transaction, or (2) the lowest conversion price
or
put or call price which would be applicable under the terms of the New
Transaction; in each such case, whether such purchase or conversion price or
put
or call price is stated or otherwise specified or is determined on the closing
date of the New Transaction by the application of a formula set in the documents
reflecting the New Transaction or could result from adjustments or revisions
contemplated in the relevant agreements for the New Transaction and whenever
such adjustment or revision would be applicable (and if no minimum purchase
price, conversion price or put or call price, as the case may be, is
set, it shall be assumed that such minimum purchase price or conversion price
is
$.01); and provided, further, that, if the securities issued in the New
Transaction are issued at a Face Value Discount (as defined below), the New
Transaction Price shall be adjusted to reflect such discount.7
(d) “New
Transaction Exercise Price” means the lowest exercise price per share applicable
to the warrants, option or similar instrument (howsoever denominated;
collectively, “New Transaction Warrants”) included in such New Transaction,
whether such exercise price is stated or could result from adjustments or
revisions contemplated in the relevant agreements for the New Transaction and
whenever such exercise price would be applicable (and, if no minimum
exercise price is set, it shall be assumed that such minimum exercise price
is
$.01).
7By
way of illustration, if convertible preferred shares
having a stated value of $1 million and a fixed conversion price of $0.50
(resulting in 2,000,000 shares) were sold for a purchase price of $800,000,
the
effective New Transaction Price would be $0.40 (the conversion price at which
$800,000 would convert into 2,000,000 shares).
4
(e) “Face
Value Discount” means consideration less than, as the case may be, (x) the
number of shares being issued multiplied by the stated purchase price, (y)
the
stated principal amount of a debenture, note or similar instrument or (z) the
stated value of the shares of convertible stock.
(f) The
term “New Transaction Period” means the period commencing on the Issue Date and
continuing until the date on which this Note is fully paid and/or
converted.
3. The
Company covenants and agrees that, if there is a Lower Price Transaction during
the New Transaction Period, then the Conversion Price on the unexercised portion
of this Note shall be adjusted to equal the lowest New Transaction Price
applicable to the Lower Price Transaction.
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EXHIBIT
A
RIM
SEMICONDUCTOR COMPANY
NOTICE
OF
CONVERSION
OF
SENIOR
SECURED PROMISSORY NOTE DUE DECEMBER ____, 2007
SERIES
07-02
(To
be
Executed by the Registered Holder in Order to Convert the Note)
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TO:
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RIM
SEMICONDUCTOR
COMPANY VIA
FAX: (000)
000-0000
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000
XX 000xx Xxx., Xxxxx
000
Xxxxxxxx,
XX 00000
Attn:
President
FROM:
_________________________________________________________
(“Holder”)
DATE:
_______________________________________________ (the “Conversion
Date”)
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RE:
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Conversion
of $_________________ principal amount (the “Converted Note”) of the
Senior Secured Promissory Note Due December ___, 2007 (the “Note”) of RIM
SEMICONDUCTOR COMPANY (the “Company”) into ________________________ shares
(the “Conversion Shares”) of Common Stock (defined
below)
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The
captioned Holder hereby gives
notice to the Company, pursuant to the Note of RIM SEMICONDUCTOR COMPANY that
the Holder elects to convert the Converted Note into fully paid and
non-assessable shares of Common Stock, $0.001 par value (the “Common Stock”), of
the Company as of the Conversion Date specified above. Said
conversion shall be based on the following Conversion Price
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$_________________,
representing the Conversion Price (as defined in the Note; as adjusted
to
reflect capital adjustments after the Issue
Date)
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$________________,
representing the Conversion Price (as adjusted pursuant to the terms
of
Appendix I to the Note)
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Based
on
this Conversion Price, the number of Conversion Shares indicated above should
be
issued in the following name(s):
Name
and Record Address
Conversion
Shares
_______________________________ _______________
_______________________________ _______________
_______________________________ _______________
It
is the intention of the Holder to
comply with the provisions of Section 1(C) of Appendix I to the Note regarding
certain limits on the Holder's right to convert thereunder. The
Holder believe this conversion complies with the provisions of said Section
1(C). Nonetheless, to the extent that, pursuant to the conversion
effected hereby, the Holder would have more shares than permitted under said
Section, this notice should be amended and revised, ab initio, to refer to
the
conversion which would result in the issuance of shares consistent with such
provision. Any conversion above such amount is hereby deemed void and
revoked.
As
contemplated by the Note, this
Notice of Conversion is being sent by facsimile to the telecopier number and
officer indicated above.
If
this Notice of Conversion represents
the full conversion of the outstanding balance of the Converted Note, the Holder
either (1) has previously surrendered the Converted Note to the Company or
(2)
will surrender (or cause to be surrendered) the Converted Note to the Company
at
the address indicated above by express courier within five (5) Trading 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
express courier, or
by
electronic transfer
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within
the time contemplated by the Note after receipt of this Notice of Conversion
(by
facsimile transmission or otherwise) to:
_____________________________________
_____________________________________
_____________________________________
3
As
contemplated by the Note, the
Company should also pay all accrued but unpaid interest on the Converted Note
to
the Holder.
--If
the Company elects to pay such
interest in Common Stock, as contemplated by and subject to the
provisions of the Note, such shares should be issued in the name of the Holder
and delivered in the same manner as, and together with, the Conversion
Shares.
--If
the Company elects or is required
to pay the interest in cash, such payment should be made by wire transfer as
follows:8
___________________________________
___________________________________
___________________________________
_____________________________________
(Print
name of Holder)
By:
__________________________________
(Signature
of Authorized
Person)
______________________________________
(Printed
Name and Title)
8Information
should
include the following:
All
Wires:
(1)
Bank
Name
(2)
Xxxx Xxxxxxx (xxxxxxxxx xxxxxx,
xxxx, xxxxx)
(3)
ABA or Wire Routing
No.
(4)
Account Name
(5)
Account Number
If
Wire
is going to International (Non-US) Bank, all of the above
plus:
(6)
SWIFT Number
4