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EXHIBIT 4.1
THIS NOTE AND THE
COMMON SHARES ISSUABLE UPON CONVERSION OF
THIS NOTE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED. THIS NOTE AND THE COMMON SHARES
ISSUABLE UPON CONVERSION OF
THIS NOTE MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN
THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT AS TO THIS NOTE
UNDER SAID ACT OR AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO ONE
VOICE TECHNOLOGIES, INC. THAT
SUCH REGISTRATION IS NOT REQUIRED.
PRINCIPAL AMOUNT $__________
ISSUE DATE: SEPTEMBER ____, 2007
PURCHASE PRICE $____________
CONVERTIBLE NOTE
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FOR VALUE RECEIVED, ONE VOICE
TECHNOLOGIES, INC., a Nevada corporation
(hereinafter called "Borrower"), hereby promises to pay to ALPHA
CAPITAL
AKTIENGESELLSCHAFT, Pradafant 7, 9490 Furstentums, Vaduz, Lichtenstein, Fax:
011-42-32323196 (the "Holder") or order, without demand, the sum of
____________________________ Dollars ($__________),on September ___, 2008 (the
"Maturity Date").
This Note has been entered into
pursuant to the terms of a subscription
agreement between the Borrower and the Holder, dated of even date herewith (the
"Subscription Agreement"), and shall be governed by the terms of such
Subscription Agreement. Unless otherwise separately defined herein, all
capitalized terms used in this Note shall have the same meaning as is set forth
in the Subscription Agreement. The following terms shall apply to this Note:
ARTICLE I
GENERAL
PROVISIONS
1.1 PAYMENT GRACE PERIOD. The
Borrower shall have a ten (10) day grace
period to pay any monetary amounts due under this Note, after which grace
period
a default interest rate of ten percent (10%) per annum shall apply to the
amounts owed hereunder.
1.2 CONVERSION PRIVILEGES. The
Conversion Privileges set forth in
Article II shall remain in full force and effect immediately from the date
hereof and until the Note is paid in full regardless of the occurrence of an
Event of Default. The Note shall be payable in full on the Maturity Date,
unless
previously converted into Common Stock in accordance with Article II hereof;
provided, that if an Event of Default has occurred (whether or not such Event
of
Default is continuing), the Borrower may not pay this Note on or after the
Maturity Date, without the consent of the Holders holding 80% of the
outstanding
principal amount of the Notes and aggregate Conversion Prices of Shares still
held by the Holders.
ARTICLE II
CONVERSION RIGHTS
The Holder shall have the right
to convert the principal due under this
Note into Shares of the Borrower's Common Stock, $.001 par value per share
("Common Stock") as set forth below.
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2.1. CONVERSION INTO
THE BORROWER'S COMMON STOCK.
(a) The Holder shall
have the right from and after the date of
the issuance of this Note and then at any time until this Note is fully paid,
to
convert any outstanding and unpaid principal portion of this Note, and accrued
interest, at the election of the Holder (the date of giving of such notice of
conversion being a "Conversion Date") into fully paid and nonassessable
shares
of Common Stock as such stock exists on the date of issuance of this Note, or
any shares of capital stock of Borrower into which such Common Stock shall
hereafter be changed or reclassified, at the conversion price as defined in
Section 2.1(b) hereof (the "Conversion Price"), determined as
provided herein.
Upon delivery to the Borrower of a Notice of Conversion as described in Section
7 of the Subscription Agreement of the Holder's written request for conversion,
Borrower shall issue and deliver to the Holder within three (3) business days
from the Conversion Date ("Delivery Date") that number of shares of
Common Stock
for the portion of the Note converted in accordance with the foregoing. At the
election of the Holder, the Borrower will deliver accrued but unpaid interest
on
the Note in the manner provided in Section 1.3 through the Conversion Date
directly to the Holder on or before the Delivery Date (as defined in the
Subscription Agreement). The number of shares of Common Stock to be issued upon
each conversion of this Note shall be determined by dividing that portion of
the
principal of the Note and interest to be converted, by the Conversion Price.
(b) Subject to
adjustment as provided in Section 2.1(c)
hereof, the Conversion Price per share shall be the lower of (i) $.015
("Maximum
Base Price"), or (ii) eighty (80%) of the average of the three lowest
closing
bid prices for the Common Stock for the thirty (30) trading days prior to but
not including the Conversion Date for the Common Stock on the OTC Pink Sheets,
NASD OTC Bulletin Board, NASDAQ SmallCap Market, NASDAQ National Market System,
American Stock Exchange, or New York Stock Exchange, as applicable, or if not
then trading on any of the foregoing, such other principal market or exchange
where the Common Stock is listed or traded (whichever of the foregoing is at
the
time the principal trading exchange or market for the Common Stock, the
"Principal Market"). Closing bid price shall mean the closing bid
price as
reported by Bloomberg L.P., but in no event will the Conversion Price be
greater
than $.015, subject to adjustment as described herein.
(c) The Maximum Base
Price and number and kind of shares or
other securities to be issued upon conversion determined pursuant to Section
2.1(a), shall be subject to adjustment from time to time upon the happening of
certain events while this conversion right remains outstanding, as follows:
A. Merger,
Sale of Assets, etc. If the Borrower at
any time shall consolidate with or merge into or sell or convey all or
substantially all its assets to any other corporation, this Note, as to the
unpaid principal portion thereof and accrued interest thereon, shall thereafter
be deemed to evidence the right to purchase such number and kind of shares or
other securities and property as would have been issuable or distributable on
account of such consolidation, merger, sale or conveyance, upon or with respect
to the securities subject to the conversion or purchase right immediately prior
to such consolidation, merger, sale or conveyance. The foregoing provision
shall
similarly apply to successive transactions of a similar nature by any such
successor or purchaser. Without limiting the generality of the foregoing, the
anti-dilution provisions of this Section shall apply to such securities of such
successor or purchaser after any such consolidation, merger, sale or
conveyance.
B.
Reclassification, etc. If the Borrower at any time
shall, by reclassification or otherwise, change the Common Stock into the same
or a different number of securities of any class or classes that may be issued
or outstanding, this Note, as to the unpaid principal portion thereof and
accrued interest thereon, shall thereafter be deemed to evidence the right to
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purchase an adjusted number of such securities and kind of securities as would
have been issuable as the result of such change with respect to the Common
Stock
immediately prior to such reclassification or other change.
C. Stock
Splits, Combinations and Dividends. If the
shares of Common Stock are subdivided or combined into a greater or smaller
number of shares of Common Stock, or if a dividend is paid on the Common Stock
in shares of Common Stock, the Conversion Price shall be proportionately
reduced
in case of subdivision of shares or stock dividend or proportionately increased
in the case of combination of shares, in each such case by the ratio which the
total number of shares of Common Stock outstanding immediately after such event
bears to the total number of shares of Common Stock outstanding immediately
prior to such event..
D. Share Issuance.
So long as this Note is
outstanding, if the Borrower shall issue any shares of Common Stock except for
the Excepted Issuances (as defined in the Subscription Agreement) for a
consideration less than the Conversion Price in effect at the time of such
issue, then, and thereafter successively upon each such issue, the Conversion
Price shall be reduced to such other lower issue price. For purposes of this
adjustment, the issuance of any security carrying the right to convert such
security into shares of Common Stock or of any warrant, right or option to
purchase Common Stock shall result in an adjustment to the Conversion Price
upon
the issuance of security and again upon the issuance of shares of Common Stock
upon exercise of such conversion or purchase rights if such issuance is at a
price lower than the then applicable Conversion Price.
(d) Whenever the
Conversion Price is adjusted pursuant to
Section






