|
EXHIBIT 4.6
THE SECURITIES REPRESENTED
BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES (COLLECTIVELY, THE “ACTS”). THE
SECURITIES MAY NOT BE SOLD, DISTRIBUTED, OFFERED, PLEDGED,
ENCUMBERED, ASSIGNED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF THE
FOLLOWING: (1) AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER THE ACTS COVERING THE TRANSACTION, (2) THE
COMPANY RECEIVES AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE ACTS,
OR (3) THE COMPANY OTHERWISE SATISFIES ITSELF THAT
REGISTRATION IS NOT REQUIRED UNDER THE ACTS. NOTWITHSTANDING THE
FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA
FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED
BY THE SECURITIES.
UNLESS PERMITTED UNDER
SECURITIES LEGISLATION IN THE APPLICABLE JURISDICTION, THE HOLDER
OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE MUST NOT TRADE
THE SECURITIES.
THIS INSTRUMENT AND THE
RIGHTS AND OBLIGATIONS EVIDENCED HEREBY ARE SUBORDINATE IN THE
MANNER AND TO THE EXTENT SET FORTH IN THAT CERTAIN SUBORDINATION
AGREEMENT (THE “SUBORDINATION AGREEMENT”) DATED AS OF
SEPTEMBER 10, 2007, BY AND AMONG WHITEBOX DELPHAX, LTD., DELPHAX
TECHNOLOGIES INC. (“US BORROWER”), WELLS FARGO BANK
NATIONAL ASSOCIATION, ACTING THROUGH ITS WELLS FARGO BUSINESS
CREDIT OPERATING DIVISION (“WELLS US”), DELPHAX
TECHNOLOGIES CANADA LIMITED (“CANADIAN BORROWER”),
WELLS FARGO FINANCIAL CORPORATION CANADA (“WELLS
CANADA”) TO (A) THE INDEBTEDNESS (INCLUDING INTEREST)
OWED BY US BORROWER PURSUANT TO THAT CERTAIN CREDIT AND SECURITY
AGREEMENT DATED AS OF SEPTEMBER 10, 2007 BETWEEN US BORROWER AND
WELLS US AND (B) THE INDEBTEDNESS (INCLUDING INTEREST) OWED BY
CANADIAN BORROWER PURSUANT TO THAT CERTAIN CREDIT AND SECURITY
AGREEMENT DATED AS OF SEPTEMBER 10, 2007 BETWEEN CANADIAN BORROWER
AND WELLS CANADA, AS EACH SUCH LOAN AND SECURITY AGREEMENT HAS BEEN
AND HEREAFTER MAY BE AMENDED, SUPPLEMENTED OR OTHERWISE MODIFIED
FROM TIME TO TIME; AND EACH HOLDER OF THIS INSTRUMENT, BY ITS
ACCEPTANCE HEREOF, SHALL BE BOUND BY THE PROVISIONS OF THE
SUBORDINATION AGREEMENT.
DELPHAX TECHNOLOGIES
CANADA LIMITED
12% SECURED SUBORDINATED
NOTE
Due: September 10,
2012
|
|
|
| $7,000,000 |
|
September 10, 2007 |
For value received, the
undersigned, Delphax Technologies Canada Limited, a corporation
duly incorporated under the laws of the Province of Ontario (the
“Company”), hereby promises to pay to the order of
Whitebox Delphax, Ltd (“Whitebox”), at its principal
office in the City of Minneapolis, Minnesota, the principal sum of
Seven Million dollars and no cents ($7,000,000) (the “Face
Amount”) in lawful money of the United States on
September 10, 2012 (the “Maturity Date”), together
with interest thereon, as more fully provided below.
This 12% Secured Subordinated
Note (the “Note”) shall bear annual interest at a fixed
rate of 12% per annum (computed based on the actual days
elapsed in a year of 360 days) of the unpaid Face Amount, payable
quarterly in arrears in lawful money of the United States on the
first business day of each calendar quarter; provided that, the
Company may elect to pay interest at the rate of 9% in cash (in
lawful money of the United States) and interest at the rate of 3%
(the “PIK Interest Portion”) by delivery of shares of
Common Stock, par value $.10 per share, of Delphax Technologies,
Inc., a Minnesota corporation (“Delphax”), which number
of shares shall be determined by dividing the monetary value of the
PIK Interest Portion of the accrued interest due on the unpaid Face
Amount for the relevant quarterly period by the Market Price of the
Common Stock as of the interest payment date.
“Market Price”
shall mean, if the Common Stock is traded on a securities exchange
or on the NASDAQ National Market, the average of the closing prices
of the Common Stock on such exchange or the NASDAQ National Market
on the 20 trading days ending on the trading day prior to the date
of determination, or, if the Common Stock is otherwise traded in
the over-the-counter market, the average of the closing bid prices
on the 20 trading days ending on the trading day prior to the date
of determination. If at any time the Common Stock is not traded on
an exchange or the NASDAQ National Market, or otherwise traded in
the over-the-counter market, the Market Price shall be deemed to be
the higher of (i) the book value thereof as determined by any
firm of independent public accountants of recognized standing
selected by the Board of Directors of Delphax as of the last day of
any month ending within 60 days preceding the date as of which the
determination is to be made, or (ii) the fair value thereof
determined in good faith by the Board of Directors of Delphax as of
a date which is within 15 days of the date as of which the
determination is to be made.
This Note has been issued
under the terms and provisions of a Securities Purchase Agreement
(the “Purchase Agreement”), dated as of
March 26,2007, among the Company, Delphax Technologies Inc.
(“Parent”), and the Investors named on the signature
pages thereto. Capitalized terms used herein and not otherwise
defined have the meaning set forth in the Purchase
Agreement.
2
Upon the occurrence of any
one or more of the Events of Default specified in Article VIII of
the Purchase Agreement, all amounts then remaining unpaid on this
Note, including any accrued but unpaid interest, may be declared to
be or shall become immediately due and payable as provided in the
Purchase Agreement.
No pre-payment by the Company
of any of the Face Amount of this Note may be made except as
provided in paragraphs 1 and 4 hereof.
All payments hereunder shall
be made free and clear of and without reduction for any taxes as
set forth in Section 1.7 of the Purchase Agreement.
This Note is subject to the
following additional provisions, terms and conditions:
1. Prepayment Upon Change
in Control .
(a) The Company shall give
the holder of this Note written notice of an impending transaction
that would constitute a Change of Control (as hereinafter defined)
not later than 20 days prior to the shareholders’ meeting
called to approve such transaction, or 20 days prior to the closing
of such transaction, whichever is earlier, and shall also notify
such holder in writing of the final approval of such transaction.
The first of such notices shall give the proposed effective date of
the transaction (the “Effective Date”), shall describe
the material terms and conditions of the transaction and of this
paragraph 1(a), and shall contain an offer by the Company to
prepay this Note at 120% of the outstanding unpaid Face Amount,
plus all unpaid interest accrued thereon to the prepayment date
(the “Change of Control Prepayment Offer”). The Company
shall thereafter give such holder prompt notice of any material
changes to such terms and conditions. Notwithstanding anything to
the contrary herein, the outstanding Face Amount of this Note may
not be pre-paid by the Company following the delivery of the first
notice delivered pursuant to this Section 1(a) except in an
amount equal to 120% of the outstanding unpaid Face Amount, plus
all unpaid interest accrued thereon to the prepayment date. The
Change of Control transaction shall in no event take place sooner
than 20 days after the mailing by the Company of the first notice
provided for herein or sooner than 10 days after the mailing by the
Company of any notice of material changes provided for
herein.
Any election by the holder of
this Note to accept the Change in Control Prepayment Offer shall be
made by the holder hereof giving written notice thereof to the
Company at least 5 days before the Effective Date. Upon receipt of
such notice, the Company shall, on the Effective Date, prepay this
Note in whole (but not in part) at 120% of the outstanding unpaid
Face Amount, plus all unpaid interest accrued thereon to the
Effective Date.
For purposes of this Note, a
“Change in Control” shall be deemed to occur if any of
the following occur:
(i) Approval by the
shareholders of Delphax of a reorganization, merger or
consolidation of Delphax or a statutory exchange of outstanding
securities entitled to vote generally in the election of directors
(“Voting Securities”) of Delphax, unless, immediately
following such reorganization,
3
merger, consolidation or
exchange, all or substantially all of the persons who were the
beneficial owners, respectively, of Voting Securities and shares of
Delphax immediately prior to such reorganization, merger,
consolidation or exchange beneficially own, directly or indirectly,
more than 50% of, respectively, the combined voting power of the
then outstanding voting securiti
|
