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EXHIBIT 10.3
FORM OF SENIOR CONVERTIBLE NOTE
NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
CONVERTIBLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY
NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE
ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN
OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER)
IN A FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION
IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO
RULE 144 OR RULE 144A UNDER SAID ACT. ANY TRANSFEREE OF THIS NOTE
SHOULD CAREFULLY REVIEW THE TERMS OF THIS NOTE, INCLUDING SECTIONS
3(c)(iii) AND 16(a) HEREOF. THE PRINCIPAL AMOUNT REPRESENTED BY
THIS NOTE AND, ACCORDINGLY, THE SECURITIES ISSUABLE UPON CONVERSION
HEREOF MAY BE LESS THAN THE AMOUNTS SET FORTH ON THE FACE HEREOF
PURSUANT TO SECTION 3(c)(iii) OF THIS NOTE.
AgFeed Industries, Inc.
Senior Convertible Note
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Issuance
Date: February __, 2008
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Principal:
U.S. $_____________ .__
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CUSIP:
00846LAA9
ISIN:
US00846LAA98
FOR VALUE RECEIVED, AgFeed
Industries, Inc., a Nevada corporation (the “
Company ”),
hereby promises to pay to______________________________
or
registered assigns (“
Holder ”)
the amount set out above as the Principal (as reduced pursuant to
the terms hereof pursuant to redemption, conversion or otherwise,
the “
Principal ”)
when due, whether upon the Maturity Date (as defined below),
acceleration, redemption or otherwise (in each case in accordance
with the terms hereof) and to pay interest (“
Interest ”)
on any outstanding Principal at the rate of 7.00% per annum (the
“
Interest Rate ”),
from the date set out above as the Issuance Date (the
“
Issuance
Date ”)
until the same becomes due and payable, whether upon an Interest
Date (as defined below), the Maturity Date, acceleration,
conversion, redemption or otherwise (in each case, in accordance
with the terms hereof). This Senior Convertible Note (including all
Senior Convertible Notes issued in exchange, transfer or
replacement hereof, this “
Note ”)
is one of an issue of Senior Convertible Notes issued pursuant to
the Securities Purchase Agreement (as defined below) on the Closing
Date (collectively, the “
Notes ”
and such other Senior Convertible Notes, the “
Other
Notes ”).
Certain capitalized terms used herein are defined in Section
26.
(1)
MATURITY .
On the Maturity Date, the Holder shall surrender the Note to the
Company and the Company shall pay to the Holder an amount in cash
representing all outstanding Principal and accrued but unpaid
Interest. The “
Maturity
Date ”
shall be the third anniversary of the Issuance Date, as may be
extended at the option of the Holder (i) in the event that, and for
so long as, an Event of Default (as defined in Section 4(a)) shall
have occurred and be continuing or any event shall have occurred
and be continuing which with the passage of time and the failure to
cure would result in an Event of Default and (ii) through the date
that is ten (10) days after the consummation of a Change of Control
in the event that a Change of Control is publicly announced or a
Change of Control Notice (as defined in Section 5(b)) is delivered
prior to the Maturity Date.
(2)
INTEREST; INTEREST RATE .
Interest on this Note shall commence accruing on the Issuance Date
and shall be computed on the basis of a 360-day year comprised of
twelve 30-day months and shall be payable in arrears on the first
day of each February and August during the period beginning on the
Issuance Date and ending on, and including, the Maturity Date
(each, an “
Interest
Date ”)
with the first Interest Date being August 1, 2008. Interest shall
be payable on each Interest Date in cash.
(3)
CONVERSION OF NOTES .
This Note shall be convertible into shares of the Company’s
common stock, par value $.001 per share (the “
Common Stock ”),
on the terms and conditions set forth in this Section
3.
(a)
Conversion Right .
Subject to the provisions of Section 3(d), at any time or times on
or after the Issuance Date, the Holder shall be entitled to convert
all or any portion of the outstanding and unpaid Conversion Amount
(as defined below) into fully paid and nonassessable shares of
Common Stock in accordance with Section 3(c), at the Conversion
Rate (as defined below). Upon any such conversion, the Company
shall also pay to the Holder all accrued but unpaid Interest on the
Conversion Amount to be converted through the Conversion Date (as
defined below). The Company shall not issue any fraction of a share
of Common Stock upon any conversion. If the issuance would result
in the issuance of a fraction of a share of Common Stock, the
Company shall round such fraction of a share of Common Stock down
to the nearest whole share. The Company shall pay any and all taxes
that may be payable with respect to the issuance and delivery of
Common Stock upon conversion of any Conversion Amount; provided
that the Company shall not be required to pay any tax that may be
payable in respect of any transfer involved in the issue and
delivery of Common Stock to any Person other than the Holder or
with respect to any income tax due by the Holder with respect to
such Common Stock issued upon conversion.
(b)
Conversion Rate .
The number of shares of Common Stock issuable upon conversion of
any Conversion Amount pursuant to Section 3(a) shall be determined
by dividing (x) such Conversion Amount by (y) the Conversion Price
(such number of shares, the “
Conversion Rate ”).
(i)
“
Conversion Amount ”
means the portion of the Principal to be converted, redeemed or
otherwise with respect to which this determination is being
made.
(ii)
“
Conversion Price ”
means, as of any Conversion Date (as defined below) or other date
of determination a price equal to $10.00, subject to adjustment as
provided herein.
(c)
Mechanics of Conversion .
(i)
Optional Conversion .
To convert any Conversion Amount into shares of Common Stock on any
date (a “
Conversion Date ”),
the Holder shall (A) transmit by facsimile (or otherwise deliver),
for receipt on or prior to 11:59 p.m., New York Time, on such date,
a copy of an executed notice of conversion in the form attached
hereto as
Exhibit I (the
“
Conversion Notice ”)
to the Company and (B) if required by Section 3(c)(iii), surrender
this Note to a common carrier for delivery to the Company as soon
as practicable on or following such date (or an indemnification
undertaking reasonably satisfactory to the Company with respect to
this Note in the case of its loss, theft or destruction) and (C)
pay any transfer taxes or other applicable taxes or duties, if any,
required in connection with the issuance of shares of Common Stock
to a Person other than the Holder. On or before the second
(2
nd )
Business Day following the date of receipt of a Conversion Notice,
the Company shall transmit by facsimile a confirmation of receipt
of such Conversion Notice to the Holder and the Company’s
transfer agent (the “
Transfer Agent ”).
On or before the third (3
rd )
Business Day following the date of receipt of a Conversion Notice
(the “
Share Delivery
Date ”),
the Company shall (X) provided that the Transfer Agent is
participating in the Depository Trust Company (“
DTC ”)
Fast Automated Securities Transfer Program, credit such aggregate
number of shares of Common Stock to which the Holder shall be
entitled to the Holder’s or its designee’s balance
account with DTC through its Deposit Withdrawal Agent Commission
system or (Y) if the Transfer Agent is not participating in the DTC
Fast Automated Securities Transfer Program, issue and deliver to
the address as specified in the Conversion Notice a certificate,
registered in the name of the Holder or its designee, for the
number of shares of Common Stock to which the Holder shall be
entitled. If this Note is physically surrendered for conversion as
required by Section 3(c)(iii) and the outstanding Principal of this
Note is greater than the Conversion Amount being converted, then
the Company shall as soon as practicable and in no event later than
five (5) Business Days after receipt of this Note and at its own
expense, issue and deliver to the holder a new Note (in accordance
with Section 16(d)) representing the outstanding Principal not
converted. The Person or Persons entitled to receive the shares of
Common Stock issuable upon a conversion of this Note shall be
treated for all purposes as the record holder or holders of such
shares of Common Stock on the Conversion Date.
(ii)
Company’s Failure to Timely Convert .
If the Company shall fail to issue a certificate to the Holder or
credit the Holder’s balance account with DTC for the number
of shares of Common Stock to which the Holder is entitled upon
conversion of any Conversion Amount on or prior to the date which
is five Business Days after the Conversion Date (a “
Conversion Failure ”),
then (A) the Company shall pay in cash to the Holder on the seventh
day of each consecutive seven day period of such Conversion Failure
an amount equal to 1.5% of the product of (I) the number of shares
of Common Stock not issued to the Holder on or prior to the Share
Delivery Date and to which the Holder is entitled, and (II) the
Closing Sale Price of the Common Stock on the Share Delivery Date
and (B) the Holder, upon written notice to the Company, may void
its Conversion Notice with respect to, and retain or have returned,
as the case may be, any portion of this Note that has not been
converted pursuant to such Conversion Notice;
provided that
the voiding of a Conversion Notice shall not affect the
Company’s obligations to make any payments which have accrued
prior to the date of such notice pursuant to this Section 3(c)(ii)
or otherwise. In addition to the foregoing, if within three (3)
Trading Days after the Company’s receipt of the facsimile
copy of a Conversion Notice the Company shall fail to issue and
deliver a certificate to the Holder or credit the Holder’s
balance account with DTC for the number of shares of Common Stock
to which the Holder is entitled upon such holder’s conversion
of any Conversion Amount, and if on or after such Trading Day the
Holder purchases (in an open market transaction or otherwise)
Common Stock to deliver in satisfaction of a sale by the Holder of
Common Stock issuable upon such conversion that the Holder
anticipated receiving from the Company (a “
Buy-In ”),
then the Company shall, within three (3) Business Days after the
Holder’s request and in the Holder’s discretion, either
(i) pay cash to the Holder in an amount equal to the Holder’s
total purchase price (including brokerage commissions and other
out-of-pocket expenses, if any) for the shares of Common Stock so
purchased (the
“Buy-In Price” ),
at which point the Company’s obligation to deliver such
certificate (and to issue such Common Stock) shall terminate, or
(ii) promptly honor its obligation to deliver to the Holder a
certificate or certificates representing such Common Stock and pay
cash to the Holder in an amount equal to the excess (if any) of the
Buy-In Price over the product of (A) such number of shares of
Common Stock times (B) the Closing Bid Price on the Conversion
Date.
(iii)
Book-Entry .
Notwithstanding anything to the contrary set forth herein, upon
conversion of any portion of this Note in accordance with the terms
hereof, the Holder shall not be required to physically surrender
this Note to the Company unless (A) the full Conversion Amount
represented by this Note is being converted or (B) the Holder has
provided the Company with prior written notice (which notice may be
included in a Conversion Notice) requesting physical surrender and
reissue of this Note. The Holder and the Company shall maintain
records showing the Principal converted and the dates of such
conversions or shall use such other method, reasonably satisfactory
to the Holder and the Company, so as not to require physical
surrender of this Note upon conversion.
(iv)
Pro Rata Conversion; Disputes .
If the Company receives a Conversion Notice from more than one
holder of Notes for the same Conversion Date and the Company can
convert some, but not all, of such portions of the Notes submitted
for conversion, the Company, subject to Section 3(d), shall convert
from each holder of Notes electing to have Notes converted on such
date a pro rata amount of such holder’s portion of its Notes
submitted for conversion based on the principal amount of Notes
submitted for conversion on such date by such holder relative to
the aggregate principal amount of all Notes submitted for
conversion on such date. In the event of a dispute as to the number
of shares of Common Stock issuable to the Holder in connection with
a conversion of this Note, the Company shall issue to the Holder
the number of shares of Common Stock not in dispute and resolve
such dispute in accordance with Section 21.
(d)
Limitations on Conversions .
(i)
Beneficial Ownership .
The Company shall not effect any conversion of this Note, and the
Holder of this Note shall not have the right to convert any portion
of this Note pursuant to Section 3(a), to the extent that after
giving effect to such conversion, the Holder (together with the
Holder’s affiliates) would beneficially own in excess of
9.99% (the “
Maximum
Percentage ”)
of the number of shares of Common Stock outstanding immediately
after giving effect to such conversion. For purposes of the
foregoing sentence, the number of shares of Common Stock
beneficially owned by the Holder and its affiliates shall include
the number of shares of Common Stock issuable upon conversion of
this Note with respect to which the determination of such sentence
is being made, but shall exclude the number of shares of Common
Stock that would be issuable upon (A) conversion of the remaining,
nonconverted portion of this Note beneficially owned by the Holder
or any of its affiliates and (B) exercise or conversion of the
unexercised or nonconverted portion of any other securities of the
Company (including, without limitation, any Other Notes or
warrants) subject to a limitation on conversion or exercise
analogous to the limitation contained herein beneficially owned by
the Holder or any of its affiliates. Except as set forth in the
preceding sentence, for purposes of this Section 3(d)(i),
beneficial ownership shall be calculated in accordance with Section
13(d) of the Securities Exchange Act of 1934, as amended. For
purposes of this Section 3(d)(i), in determining the number of
outstanding shares of Common Stock, the Holder may rely on the
number of outstanding shares of Common Stock as reflected in (x)
the Company’s most recent Form 10-K, Form 10-Q or Form 8-K,
as the case may be, (y) a more recent public announcement by the
Company or (z) any other notice by the Company or the Transfer
Agent setting forth the number of shares of Common Stock
outstanding. For any reason at any time, upon the written or oral
request of the Holder, the Company shall within one Business Day
confirm orally and in writing to the Holder the number of shares of
Common Stock then outstanding. In any case, the number of
outstanding shares of Common Stock shall be determined after giving
effect to the conversion or exercise of securities of the Company,
including this Note, by the Holder or its affiliates since the date
as of which such number of outstanding shares of Common Stock was
reported.
(ii)
Principal Market Regulation .
The Company shall not issue any shares of Common Stock upon
conversion of this Note, and the Holder of this Note shall not have
the right to receive upon conversion of this Note any shares of
Common Stock (and only such shares of Common Stock), if the
issuance of such shares of Common Stock would exceed the aggregate
number of shares of Common Stock which the Company may issue upon
conversion or exercise, as applicable, of the Notes and Warrants
without breaching the Company’s obligations under the rules
or regulations of the Principal Market (the “
Exchange Cap ”),
except that such limitation shall not apply in the event that the
Company obtains the approval of its stockholders as required by the
applicable rules of the Principal Market for issuances of Common
Stock in excess of such amount, which such approval the Company
will use its best efforts to obtain. Until such approval is
obtained, no purchaser of the Notes pursuant to the Securities
Purchase Agreement (the “
Purchasers ”)
shall be issued in the aggregate, upon conversion or exercise, as
applicable, of Notes or Warrants, shares of Common Stock in an
amount greater than the product of the Exchange Cap multiplied by a
fraction, the numerator of which is the principal amount of Notes
issued to the Purchasers pursuant to the Securities Purchase
Agreement on the Closing Date and the denominator of which is the
aggregate principal amount of all Notes issued to the Purchasers
pursuant to the Securities Purchase Agreement on the Closing Date
(with respect to each Purchaser, the “
Exchange Cap Allocation ”).
In the event that any Purchaser shall sell or otherwise transfer
any of such Purchaser’s Notes, the transferee shall be
allocated a pro rata portion of such Purchaser’s Exchange Cap
Allocation, and the restrictions of the prior sentence shall apply
to such transferee with respect to the portion of the Exchange Cap
Allocation allocated to such transferee. In the event that any
holder of Notes shall convert all of such holder’s Notes into
a number of shares of Common Stock that, in the aggregate, is less
than such holder’s Exchange Cap Allocation, then the
difference between such holder’s Exchange Cap Allocation and
the number of shares of Common Stock actually issued to such holder
shall be allocated to the respective Exchange Cap Allocations of
the remaining holders of Notes on a pro rata basis in proportion to
the aggregate principal amount of the Notes then held by each such
holder. In avoidance of confusion, the Holder acknowledges that on
the Closing Date of the Securities Purchase Agreement the Company
shall also issue 2,444,448 shares of Common Stock in an unrelated
registered offering pursuant to the purchase agreement dated
February 22, 2008 among the investors named therein and the Company
(the “
Registration Shares ”)
and the Holder further acknowledges that the Registration Shares
shall be included in calculating the Exchange Cap.
(e)
Conversion Price Adjustment .
In the event that the Company’s audited net income for the
fiscal year ended December 31, 2008, as reported in the
Company’s Form 10-K for the year ended December 31, 2008, as
filed with the Securities and Exchange Commission (the
“SEC”), is less than $30 million (excluding warrant
accounting charges, transaction fees related to this offering and
interest charges related to the Convertible Note), the then
existing Conversion Price shall be adjusted downward by the
percentage of shortfall in reaching the $30 million goal. By way of
example, if the company fell 10% short of its goal of reaching $30
million, then the conversion price would be adjusted downward by
10% to $9.00 per share. If the Company’s audited net income
for the fiscal year ended December 31, 2009, as reported in the
Company’s Form 10-K for the year ended December 31, 2009, as
filed with the SEC, is less than $40 million (excluding warrant
accounting charges, transaction fees related to this offering and
interest charges related to the Convertible Note), the then
existing Conversion Price will also be adjusted downward
proportionally to the Company’s percentage shortfall for
2009. In no event shall the aggregate adjustments of the Conversion
Price result in a Conversion Price below $5.00 per share;
provided that
the Conversion Price that results from any adjustment set forth in
this paragraph shall be further adjusted to reflect any adjustment
to such resulting Conversion Price pursuant to Section 7(a)
occurring between the Subscription Date and the date of the
adjustment under this paragraph.
(i)
Notice of Adjustments .
Whenever the Conversion Price is adjusted pursuant to this Section
3(e), the Company shall promptly deliver to the Holder a notice
setting forth the Conversion Price after such adjustment and
setting forth a brief statement of the facts requiring such
adjustment, provided that any failure to so provide such notice
shall not affect the automatic adjustment hereunder.
(4)
RIGHTS UPON EVENT OF DEFAULT .
(a)
Event of Default .
Each of the following events shall constitute an “
Event of Default ”:
(i)
the
failure of the applicable Registration Statement required to
be filed pursuant to the Registration Rights Agreement to be
declared effective by the SEC on or prior to the Effectiveness
Date (as defined in the Registration Rights Agreement), or,
while the applicable Registration Statement is required to be
maintained effective pursuant to the terms of the Registration
Rights Agreement, the effectiveness of the applicable
Registration Statement lapses for any reason (including,
without limitation, the issuance of a stop order) or is
unavailable to any holder of the Notes for sale of all of such
holder’s Registrable Securities (as defined in the
Registration Rights Agreement) in accordance with the terms of
the Registration Rights Agreement, and such lapse or
unavailability continues for a period of fifteen (15)
consecutive days or for more than an aggregate of twenty-five
(25) Trading Days in any 365-day period (other than days
during any grace period allowed under the Registration Rights
Agreement);
(ii)
the
Company’s (A) failure to cure a Conversion Failure by
delivery of the required number of shares of Common Stock
within ten (10) Business Days after the applicable Conversion
Date or (B) notice, written or oral, to any holder of the
Notes, including by way of public announcement or through any
of its agents, at any time, of its intention not to comply
with a permitted request for conversion of any Notes into
shares of Common Stock that is tendered in accordance with the
provisions of the Notes (other than notice delivered by the
Company in good faith in connection with a dispute that is
being resolved in accordance with Section 21 as to the
appropriate number of shares of Common Stock to be delivered
upon conversion of the Notes so long as the Company timely
delivers any shares not subject to such dispute and following
the resolution of such dispute the Company delivers such
appropriate number of shares to the Holder within two (2) days
of such resolution);
(iii)
the
failure for ten (10) consecutive Business Days of the
Holder’s Authorized Share Allocation to equal or exceed
the number of shares of Common Stock that the Holder would be
entitled to receive upon a conversion of the full Conversion
Amount of this Note (without regard to any limitations on
conversion set forth in Section 3(d) or
otherwise);
(iv)
the
Company’s failure to pay to the Holder any amount of
Principal, Interest or other amounts when and as due under
this Note (including, without limitation, the Company’s
failure to pay any redemption payments, premiums or other
amounts hereunder) or any other Transaction Document (as
defined in the Securities Purchase Agreement) except, in the
case of a failure to pay Interest when and as due, in which
case only if such failure continues for a period of at least
three (3) Business Days after written notice thereof is
delivered to the Company;
(v)
the
Company or
any of its material Subsidiaries ,
pursuant to or within the meaning of Title 11, U.S. Code, or
any similar Federal or state law for the relief of debtors
(collectively, “
Bankruptcy Law ”),
(A) commences a voluntary case, (B) consents to the entry of an
order for relief against it in an involuntary case, (C) consents to
the appointment of a receiver, trustee, assignee, liquidator or
similar official (a “
Custodian ”),
(D) makes a general assignment for the benefit of its creditors or
(E) admits in writing that it is generally unable to pay its debts
as they become due;
(vi)
a
court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that (A) is for relief against the
Company in an involuntary case, (B) appoints a Custodian of
the Company or
any of its material Subsidiaries or
(C) orders the liquidation of the Company or
any of its material Subsidiaries ;
(vii)
the
Company breaches, in any material manner, any representation,
warranty, covenant (other than the covenants set forth in
Section 12 of this Note) or other term or condition of any
Transaction Document, except, in the case of a breach of a
covenant which is curable, only if such breach continues for a
period of at least thirty (30) consecutive days after written
notice thereof is delivered to the Company;
(viii)
any
breach or failure to comply with Section 12 of this
Note;
(ix)
an
event or change in circumstances occurs that has had or could
reasonably be expected to have a Material Adverse Effect (as
defined in the Securities Purchase Agreement); or
(x)
any
Event of Default (as defined in the Other Notes) occurs with
respect to any Other Notes.
(b)
Redemption Right .
Promptly after the occurrence of an Event of Default, the Company
shall deliver written notice thereof via facsimile and overnight
courier (an “
Event of Default Notice ”)
to the Holder. At any time after the earlier of the Holder’s
receipt of an Event of Default Notice and the Holder becoming aware
of an Event of Default, any Required Holder may require the Company
to redeem all or any portion of the Note held by such Required
Holder (and, upon the consent of each Holder of Other Notes, all or
any portion of such Other Notes) by delivering written notice
thereof (the “
Event of Default Redemption Notice ”)
to the Company, which Event of Default Redemption Notice shall
indicate the portion of such Note such Required Holder is electing
to redeem. Each portion of this Note subject to redemption by the
Company pursuant to this Section 4(b) shall be redeemed by the
Company at a price equal to the greater of (i) the Conversion
Amount to be redeemed plus all accrued but unpaid Interest thereon
and (ii) the product of (A) the Conversion Rate with respect to
such Conversion Amount in effect at such time as the Holder
delivers an Event of Default Redemption Notice, and (B) the Closing
Sale Price of the Common Stock on the date immediately preceding
such Event of Default, plus all accrued but unpaid interest on such
Conversion Amount (the “
Event of Default
Redemption Price ”).
Redemptions required by this Section 4(b) shall be made in
accordance with the provisions of Section 11.
(5)
RIGHTS UPON FUNDAMENTAL TRANSACTION, CHANGE OF CONTROL AND
TERMINATION OF TRADING .
(a)
Assumption .
The Company shall not enter into or be party to a Fundamental
Transaction unless (i) the Successor Entity assumes in
writing all of the obligations of the Company under this Note and
the other Transaction Documents in accordance with the provisions
of this Section 5(a) pursuant to written agreements in form and
substance satisfactory to the Required Holders and approved by the
Required Holders prior to such Fundamental Transaction, including
agreements to deliver to each holder of Notes in exchange for such
Notes a security of the Successor Entity evidenced by a written
instrument substantially similar in form and substance to the
Notes, including, without limitation, having a principal amount and
interest rate equal to the principal amounts and the interest rates
of the Notes held by such holder and having similar ranking to the
Notes, and satisfactory to the Required Holders, and (ii) the
Successor Entity (including its Parent Entity) is a publicly traded
corporation whose common stock is quoted on or listed for trading
on an Eligible Market. Upon the occurrence of any Fundamental
Transaction, the Successor Entity shall succeed to, and be
substituted for (so that from and after the date of such
Fundamental Transaction, the provisions of this Note referring to
the “Company” shall refer instead to the Successor
Entity), and may exercise every right and power of the Company and
shall assume all of the obligations of the Company under this Note
with the same effect as if such Successor Entity had been named as
the Company herein. Upon consummation of the Fundamental
Transaction, the Successor Entity shall deliver to the Holder
confirmation that there shall be issued upon conversion or
redemption of this Note at
any time after the consummation of the Fundamental Transaction, in
lieu of the shares of the Company’s Common Stock
(or
other securities, cash, assets or other property)
issuable
upon the conversion or redemption of the Notes prior to such
Fundamental Transaction ,
such
shares of stock, securities, cash, assets or any other property
whatsoever (including warrants or other purchase or subscription
rights) which the Holder would have been entitled to receive upon
the happening of such Fundamental Transaction had this Note been
converted immediately prior to such Fundamental Transaction, as
adjusted in accordance with the provisions of this Note.
The
provisions of this Section shall apply similarly and equally to
successive Fundamental Transactions and shall be applied without
regard to any limitations on the conversion or redemption of this
Note.
(b)
Redemption Right .
No sooner than fifteen (15) days nor later than ten (10) days prior
to the consummation of a Change of Control, but not prior to the
public announcement of such Change of Control, the Company shall
deliver written notice thereof via facsimile and overnight courier
to the Holder (a “
Change of Control
Notice ”).
At any time during the period (the “
Change of Control Period ”)
beginning after the Holder’s receipt of a Change of Control
Notice and ending on the date of the consummation of such Change of
Control (or, in the event a Change of Control Notice is not
delivered at least ten (10) days prior to a Change of Control, at
any time on or after the date which is ten (10) days prior to a
Change of Control and ending ten (10) days after the consummation
of such Change of Control), the Holder may require the Company to
redeem all or any portion of this Note by delivering written notice
thereof (“
Change of Control Redemption Notice ”)
to the Company, which Change of Control Redemption Notice shall
indicate the Conversion Amount the Holder is electing to redeem.
The portion of this Note subject to redemption pursuant to this
Section 5(b) shall be redeemed by the Company in cash at a price
equal to the sum of (i) the Make-Whole Premium plus (ii) the
Conversion Amount being redeemed plus (iii) all accrued
but
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