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EXHIBIT 4.3
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), AND MAY NOT BE SOLD,
TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS
THERE IS AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH ACT COVERING THIS NOTE,
THE SALE IS MADE IN ACCORDANCE WITH RULE
144 UNDER THE ACT, OR, IF REQUESTED BY
THE COMPANY, THE COMPANY RECEIVES AN
OPINION OF COUNSEL FOR HOLDER OF THIS NOTE
REASONABLY SATISFACTORY TO THE COMPANY,
STATING THAT SUCH SALE, TRANSFER,
ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM
THE REGISTRATION AND PROSPECTUS
DELIVERY REQUIREMENTS OF SUCH ACT.
VISTA.COM, INC.
8% CONVERTIBLE UNSECURED PROMISSORY NOTE
$____,000.00
May ___, 2005
Redmond, Washington
FOR VALUE
RECEIVED, Vista.com, Inc., a Washington corporation (the
"Company"), hereby unconditionally promises
to pay to _________________
("Holder"), or Holder's registered assigns,
at such place or places as Holder
may from time to time designate in writing,
the aggregate principal sum of
______________ THOUSAND DOLLARS AND 00/100
CENTS ($___,000.00), together with
all accrued and unpaid interest thereon, as
provided herein. All unpaid
principal, together with the balance of
unpaid and accrued interest and other
amounts payable hereunder, shall be due and
payable in cash on demand at any
time upon and after the earlier of (a) June
30, 2007 (the "Maturity Date"), or
(b) the occurrence of an Event of Default
(as defined herein). This 8%
Convertible Unsecured Promissory Note (this
"Note") is one of a series of
convertible unsecured promissory notes of
the Company in the aggregate principal
amount of up to Five Million Dollars
($5,000,000), or such greater amount as
determined by the Company (the "Notes"),
issued to accredited investors pursuant
to a certain 8% Convertible Unsecured
Promissory Note Purchase Agreement, by and
among the Company and each purchaser of a
Note. All cash payments by the Company
under this Note shall be in immediately
available funds.
A. Definitions.
1. "Change
of Control Event" shall mean (a) any transaction in which the
Company consummates a merger,
consolidation, share exchange or other transaction
or series of related transactions resulting
in the exchange of the outstanding
shares of the Company for securities of or
other consideration issued, or caused
to be issued, by an acquiring entity or any
of its affiliates, in any such case
if the shareholders of the Company
immediately prior to such event own less than
a majority of the outstanding voting equity
securities of the surviving entity
immediately following the event, or (b) a
sale, lease, exclusive license or
other disposition of all or substantially
all of the assets of the Company.
2.
"Majority of the Noteholders" shall mean at least a
majority-in-interest of holders of the
Notes (such majority determined on the
basis of each Holder's proportionate share
of the aggregate unpaid principal
amount of all Notes then outstanding).
Where action is taken by a Majority of
the Noteholders, such action shall be
binding on each holder of a Note, whether
or not such holder has consented in writing
to such action.
8% CONVERTIBLE UNSECURED
PROMISSORY NOTE
1
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3. "Note
Conversion Shares" shall mean the shares of Common Stock (or
Allowed Consideration) issuable upon
conversion of this Note pursuant to Section
B.3.(a) or Section B.3.(b), including any
securities of another company for
which the Company's Common Stock has been
exchanged.
4.
"Obligations" shall mean the outstanding principal and accrued
but
unpaid interest due hereunder and any
additional amounts payable pursuant to the
terms hereof.
5.
"Automatic Conversion Date" shall mean the ninetieth (90th)
consecutive
trading day on which the Publicly Traded
Securities have been actively traded
over-the-counter or on a national
securities exchange or quotation system at a
closing bid price which is at or above
$3.00 per share (as adjusted for any
stock splits, dividends, recapitalizations
and the like).
6.
"Publicly Traded Securities" shall mean a class of the Company's
equity
securities that is registered under Section
12(g) or 15(d) of the Securities
Exchange Act of 1934, as amended (the
"Exchange Act"), or a class of equity
securities of another company or entity
that is registered under Section 12(g)
or 15(d) of the Exchange Act, for which a
class of the Company's equity
securities has been exchanged.
B. Interest; Conversion Terms.
1.
Interest. Interest shall accrue with respect to the principal
amount
loaned hereunder from the date hereof until
such principal is fully paid or
converted, at eight percent (8.0%) simple
interest per annum (computed on the
basis of a 365-day year, based upon the
actual days elapsed); provided, however,
that, upon the occurrence of an Event of
Default, the principal balance
hereunder shall bear interest from and
after the date of the Event of Default at
a rate of ten percent (10.0%) simple
interest per annum (computed on the basis
of a 365-day year, based upon the actual
days elapsed).
2.
Prepayment. The Company may prepay all or any portion of the Notes
at
any time without penalty, fee or
acceleration; provided, however, that the
Company shall give Holder twenty (20) days'
prior written notice of such
prepayment, during which time Holder may
elect to convert the outstanding
principal amount and accrued but unpaid
interest under the Note pursuant to
Section B.3.(b) by giving the Company
written notice of Holder's election (the
"Notice Period"). Any such prepayment shall
be made on a pro rata basis to each
Holder of a Note, based on the principal
amount of the Notes then outstanding at
the time of prepayment, and will be applied
first to the payment of expenses due
under each Note, second to interest accrued
on each Note and third, if the
amount of prepayment exceeds the amount of
all such expenses and accrued
interest, to the payment of principal of
each Note.
3.
Conversion.
(a) Automatic Conversion. Effective as of 5:00 p.m. Pacific Time
on
the Automatic Conversion Date, the
outstanding principal amount under this Note
and all accrued but unpaid interest shall
be automatically converted in full
into Note Conversion Shares. The number of
Note Conversion Shares to be issued
upon such conversion shall be equal to the
number obtained by dividing (i) the
outstanding principal amount and accrued
but unpaid interest under this Note on
the date of conversion by (ii) a price per
share equal to 85% of the average of
the closing bid prices of the Publicly
Traded Securities over the 30-trading day
period ending on the Automatic Conversion
Date ("Automatic Conversion Price").
The number of Note Conversion Shares
issuable to Holder upon such conversion
shall be rounded down to the nearest whole
number.
8% CONVERTIBLE UNSECURED
PROMISSORY NOTE
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(b) Optional Conversion. If this Note is not sooner paid or
converted, then (i) at any time after a
class of the Company's equity securities
becomes Publicly Traded Securities or have
been exchanged for a class of equity
securities that constitute Publicly Traded
Securities, (ii) during the Notice
Period, (iii) upon a Change of Control
Event, or (iv) on or after the Maturity
Date, the outstanding principal amount and
accrued but unpaid interest under
this Note will be convertible in full and
not in part, upon the written election
of the Holder, into Note Conversion Shares,
effective as of 5:00 p.m. Pacific
Time on the date on which the Company
accepts the Holder's written election to
convert this Note. The number of Note
Conversion Shares to be issued upon such
conversion shall be equal to the number
obtained by dividing (x) the outstanding
principal amount and accrued but unpaid
interest under this Note on the date of
conversion , if Holder's written election
is received by the Company prior to
the Automatic Conversation date, by (y) a
conversion price equal to $1.50 per
share (as adjusted for any stock splits,
dividends, recapitalizations and the
like) (the "Optional Conversion Price").
The number of Note Conversion Shares
issuable to Holder upon such conversion
shall be rounded down to the nearest
whole number.
(c) Mechanics and Effects of Conversion. As soon as practicable
after conversion of this Note, and upon
surrender of this Note, the Company will
deliver or cause to be issued in the name
of and delivered to Holder a
certificate or certificates representing
the number of Note Conversion Shares to
which Holder shall be entitled on such
conversion. No fractional shares will be
issued on conversion of this Note, and in
lieu thereof Holder shall be entitled
to payment in cash of the amount of this
Note not converted into Note Conversion
Shares. Upon full conversion of this Note
and the issuance of the certificate(s)
and payment of cash for fractional shares
as contemplated herein, the Company
shall be forever released from all its
Obligations and liabilities under this
Note.
(d) Notice Regarding Change of Control Event. At least ten (10)
days
prior to the anticipated closing of a
Change of Control Event, written notice
shall be delivered to the Holder of this
Note pursuant to Section E.5 below
notifying Holder of the terms and
conditions of the Change of Control Event, the
amount of the outstanding principal amount
and accrued but unpaid interest under
this Note, the anticipated date on which
any such conversion will occur and
calling upon such Holder to inform the
Company whether Holder intends to elect
to convert the outstanding principal amount
and accrued but unpaid interest into
Note Conversion Shares. Following notice of
the Change of Control Event, any
conversion of this Note by Holder may be
made contingent upon the consummation
of such Change of Control Event, if so
elected by Holder in the notice of
conversion.
(e) No Rights as Shareholder. Prior to its conversion, this
Note
shall not entitle Holder to any voting
rights or to any other rights as a
shareholder of the Company or to any other
rights whatsoever except the rights
stated herein or in the agreements
referenced herein.
(f) Withholding Obligations; Form 1099. Holder authorizes the
Company to withhold from Holder, or to
demand cash payment from Holder for, any
taxes required to be withheld from Holder
on the conversion of this Note, or, to
reduce or eliminate such withholding, to
provide the Company with an fully
executed and completed IRS Form W-9. Holder
acknowledges that the Company may
issue Holder a Form 1099, reporting the
interest, to the Internal Revenue
Service (even if the interest is converted
into stock), in accordance with law.
4.
Covenants as to Note Conversion Shares. The Company covenants
and
agrees that all Note Conversion Shares
issued pursuant to the terms of this Note
(the "Reserved Shares") will, upon their
issuance, be validly issued and
outstanding, fully paid and nonassessable
and free from all taxes, liens, and
charges with respect to the issuance
thereof. The Company further covenants and
agrees that the Company will at all times
have authorized and reserved a
sufficient number of the Reserved Shares to
provide for the
8% CONVERTIBLE UNSECURED
PROMISSORY NOTE
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conversion r
