Conversion of Debenture. (a) From time to time, until all unpaid principal and accrued and unpaid interest under this Debenture is paid, the holder of this Debenture shall have the right to convert (i) at any time from and after January 29, 1998, up to one-third of the principal amount of this Debenture, (ii) at any time from and after February 28, 1998, up to an aggregate of two-thirds of the principal amount of this Debenture, and (iii) at any time from and after March 30, 1998, all of the principal amount of this Debenture, in whole or in part, into an amount of duly authorized, fully-paid and non-assessable shares of Common Stock determined by dividing such principal amount to be so converted by the Conversion Price (as hereinafter defined), and upon the terms and subject to the conditions hereinafter specified in this Section 2. Any unpaid principal amount of this Debenture outstanding on October 31, 2000, together with any accrued and unpaid interest thereon, shall automatically convert to Common Stock at the Conversion Price (defined below). (b) In order to convert this Debenture into shares of Common Stock, the holder shall: (i) fax a copy of the fully executed notice of conversion in the form attached hereto ("Notice of Conversion") to the Company at the office of the Company or its designated transfer agent, if any, for the Debentures, which notice shall specify the amount of the Debenture to be converted, the applicable Conversion Price, and a calculation of the number of shares of Common Stock issuable upon such conversion (together with a copy of the first page of this Debenture) prior to 5:00 p.m., Mountain time (the "Conversion Notice Deadline") on the date of conversion specified on the Notice of Conversion; and (ii) surrender the original Debenture being converted, along with a copy of the Notice of Conversion as soon as practicable thereafter to the office of the Company or the transfer agent, if any, for the Debentures; provided, however, that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such conversion unless either the Debenture is delivered to the Company or its transfer agent as provided above, or the holder notifies the Company or its transfer agent that such original Debenture has been lost, stolen or destroyed. In the case of a dispute as to the calculation of the Conversion Price, the Company shall promptly issue such number of shares of Common Stock that are not disputed in accordance with subparagraph (c) below. The Company shall submit the disputed calculations to its outside accountant via facsimile within two (2) business days of receipt of the Notice of Conversion. The accountant shall audit the calculations and notify the Company and the holder of the results no later than 48 hours from the time it receives the disputed calculations. The accountant's calculation shall be deemed conclusive absent manifest error. (c) Upon the surrender of the Debenture as described above accompanied by the Notice of Conversion, the Company shall issue and, within two (2) business days (the "Delivery Period") after such surrender (or, in the case of lost, stolen or destroyed Debenture, after provision of an agreement and indemnification by the holder to the Company), direct its transfer agent to deliver to or upon the order of the holder (i) that number of shares of Common Stock for the portion of the Debenture converted as shall be determined in accordance herewith and (ii) a new Debenture representing the balance of the principal amount of the Debenture surrendered but not converted, if any. In addition to any other remedies available to the holder, including actual damages and/or equitable relief, the Company shall pay to the holder $250 in cash for the third day beyond such Delivery Period that the Company fails to deliver Common Stock issuable upon surrender of the Debenture with a Notice of Conversion, and $500 per day in cash for each day thereafter, until such time as the earlier of the date that the Company has delivered all such Common Stock and the tenth day beyond such Delivery Period. Such cash amount shall be paid to such holder by the fifth day of the month following the month in which it has accrued. In the event the Company fails to deliver such Common Stock prior to the expiration of the ten (10) business day period after the Delivery Period for any reason (whether due to a requirement of law or a stock exchange or otherwise), such holder shall be entitled to (in addition to any other remedies available to the holder) Conversion Default Payments in accordance with Section 2(h) hereof beginning on the expiration of such ten (10) business day period. (d) If any conversion of this Debenture would result in a fractional share of Common Stock or the right to acquire a fractional share of Common Stock, such fractional share shall be disregarded and Company shall pay in cash to the holder the value of such fractional share based on the Market Price on the Conversion Date.
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Conversion of Debenture. (a) From 3.1 This Debenture shall be convertible into Ordinary Shares on the terms and conditions set out in this Debenture.
3.2 Subject to the provisions of Section 5 below, at any time or times on or after the Issue Date, any Holder shall be entitled to time, until all convert any part of the outstanding and unpaid principal and accrued and unpaid interest under amount of this Debenture is paidinto fully paid Ordinary Shares in accordance with Section 6, at the holder Conversion Rate (as defined in Section 4.1 below).
3.3 The Company shall not issue any fraction of an Ordinary Share upon any conversion. All Ordinary Shares (including fractions thereof) issuable upon conversion of this Debenture shall have be aggregated for the right purpose of determining whether the conversion would result in the issue of a fraction of an Ordinary Share. If, after the aforementioned aggregation, the issue would result in the issue of a fraction of an Ordinary Share, the Company shall round such fraction of an Ordinary Share up or down to convert the nearest whole share.
3.4 The interest accrued in respect of any principal of the Debenture which is converted (iother than pursuant to a Company Conversion pursuant to Section 14) at any time from shall be paid in cash on the relevant Conversion Date, and after January 29simultaneously with the credit of the aggregate number of Ordinary Shares to which the Holder is entitled on such conversion to the Holder's or its designee's Crest stock account or its balance account with another electronic or book-entry delivery system, 1998or, up where such shares are to one-third be in certificated form, the delivery to the Holder of the certificates representing the Ordinary Shares issuable upon conversion, in each case, in accordance with Section 6 below.
3.5 If any Debentures remain outstanding on their Maturity Date, then all such Debentures shall be redeemed in whole by the Company pursuant to this Section 3.5. On the Maturity Date the Company shall pay to each holder of Debentures outstanding on the Maturity Date applicable to such Debentures by wire transfer of immediately available funds, the sum of the principal amount of this Debenture, (ii) at any time from and after February 28, 1998, up save to an aggregate of two-thirds of the principal amount of this Debentureextent previously converted or repaid in accordance with the provisions hereof, and (iii) at any time from and after March 30, 1998, all of the principal amount of this Debenture, in whole or in part, into an amount of duly authorized, fully-paid and non-assessable shares of Common Stock determined by dividing such principal amount to be so converted by the Conversion Price (as hereinafter defined), and upon the terms and subject to the conditions hereinafter specified in this Section 2. Any unpaid principal amount of this Debenture outstanding on October 31, 2000, together with any accrued and unpaid interest thereonInterest Amounts outstanding, shall automatically convert to Common Stock including any amounts payable at the Conversion Price (defined below).
(b) In order to convert this Debenture into shares of Common Stock, the holder shall: (i) fax a copy of the fully executed notice of conversion in the form attached hereto ("Notice of Conversion") to the Company at the office of the Company or its designated transfer agent, if any, for the Debentures, which notice shall specify the amount of the Debenture to be converted, the applicable Conversion Price, and a calculation of the number of shares of Common Stock issuable upon such conversion (together with a copy of the first page of this Debenture) prior to 5:00 p.m., Mountain time (the "Conversion Notice Deadline") on the date of conversion specified on the Notice of Conversion; and (ii) surrender the original Debenture being converted, along with a copy of the Notice of Conversion as soon as practicable thereafter to the office of the Company or the transfer agent, if any, for the Debentures; provided, however, that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such conversion unless either the Debenture is delivered to the Company or its transfer agent as provided above, or the holder notifies the Company or its transfer agent that such original Debenture has been lost, stolen or destroyedDefault Rate. In the case of a dispute as to the calculation of the Conversion Price, the Company shall promptly issue such number of shares of Common Stock that are not disputed in accordance with subparagraph (c) below. The Company shall submit the disputed calculations to its outside accountant via facsimile within two (2) business days of receipt of the Notice of Conversion. The accountant shall audit the calculations and notify the Company and the holder of the results no later than 48 hours from the time it receives the disputed calculations. The accountant's calculation shall be deemed conclusive absent manifest error.
(c) Upon the surrender of the Debenture as described above accompanied by the Notice of Conversion, the Company shall issue and, within two (2) business days (the "Delivery Period") after such surrender (or, in the case of lost, stolen or destroyed Debenture, after provision of an agreement and indemnification by the holder to the Company), direct its transfer agent to deliver to or upon the order of the holder (i) that number of shares of Common Stock for the portion of the Debenture converted as shall be determined in accordance herewith and (ii) a new Debenture representing the balance of the principal amount of the Debenture surrendered but not converted, if any. In addition to any other remedies available to the holder, including actual damages and/or equitable relief, the Company shall pay to the holder $250 in cash for the third day beyond such Delivery Period that If the Company fails to deliver Common Stock issuable upon surrender redeem all of the Debenture with a Notice of ConversionDebentures outstanding on the Maturity Date, and $500 per day in cash for each day thereafterthen, until such time as the earlier of the date that the Company has delivered all such Common Stock and the tenth day beyond such Delivery Period. Such cash amount shall be paid to such holder by the fifth day of the month following the month in which it has accrued. In the event the Company fails to deliver such Common Stock prior to the expiration of the ten (10) business day period after the Delivery Period for any reason (whether due to a requirement of law or a stock exchange or otherwise), such holder shall be entitled to (in addition to any other remedies available remedy the Holder may have under this Debenture and the Subscription Agreement, the amounts of principal and interest payable in respect of such unredeemed Debentures shall bear interest at the Default Rate until paid in full.
3.6 On the Maturity Date, the Holder shall surrender this Debenture upon its redemption on such date to the holder) Conversion Default Payments Company.
3.7 Subject to Section 14.2, any principal amount which the Holder elects to convert in accordance with this Section 2(h3 and Section 6 (other than pursuant to Company Conversions pursuant to Section 14) hereof beginning shall be deducted first from the Installment Amount relating to the latest Installment Period (i.e., nearest to the Maturity Date) with respect to which Installment Amounts remain outstanding and then sequentially from the immediately preceding Installment Periods (and within each such Installment Amount, first from the amounts, if any which would be subject to a conversion on the expiration of latest Settlement Date within such ten (10) business day period.
(d) If any conversion of this Debenture would result in a fractional share of Common Stock or Installment Period and then sequentially from the right to acquire a fractional share of Common Stock, such fractional share shall be disregarded and Company shall pay in cash amounts subject to the holder the value of such fractional share based on the Market Price on the Conversion Dateimmediately preceding Settlement Dates).
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Sources: Subscription Agreement (Regus PLC)
Conversion of Debenture. (a) From time to time, until all unpaid principal and accrued and unpaid interest under this Debenture is paid, the holder of this Debenture shall have the right to convert (i) at any time from and after January 29, 1998one hundred twenty (120) days after the original issuance hereof, up to one-third of the principal amount of this Debenture, (ii) at any time from and after February 28, 1998one hundred eighty (180) days after the original issuance hereof, up to an aggregate of two-thirds of the principal amount of this Debenture, and (iii) at any time from and after March 30, 1998two hundred forty (240) days after the original issuance hereof, all of the principal amount of this Debenture, in whole or in part, into an amount of duly authorized, fully-paid and non-assessable shares of Common Stock determined by dividing such principal amount to be so converted by the Conversion Price (as hereinafter defined), and upon the terms and subject to the conditions hereinafter specified in this Section 2. Any unpaid principal amount of this Debenture outstanding on October 31, 2000the Due Date, together with any accrued and unpaid interest thereon, shall automatically convert to Common Stock at the Conversion Price (defined below).
(b) In order to convert this Debenture into shares of Common Stock, the holder shall: (i) fax a copy of the fully executed notice of conversion in the form attached hereto ("Notice of Conversion") to the Company at the office of the Company or its designated transfer agent, if any, for the Debentures, which notice shall specify the amount of the Debenture to be converted, the applicable Conversion Price, and a calculation of the number of shares of Common Stock issuable upon such conversion (together with a copy of the first page of this Debenture) prior to 5:00 p.m., Mountain time (the "Conversion Notice Deadline") on the date of conversion specified on the Notice of Conversion; and (ii) surrender the original Debenture being converted, along with a copy of the Notice of Conversion as soon as practicable thereafter to the office of the Company or the transfer agent, if any, for the Debentures; provided, however, that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such conversion unless either the Debenture is delivered to the Company or its transfer agent as provided above, or the holder notifies the Company or its transfer agent that such original Debenture has been lost, stolen or destroyed. In the case of a dispute as to the calculation of the Conversion Price, the Company shall promptly issue such number of shares of Common Stock that are not disputed in accordance with subparagraph (c) below. The Company shall submit the disputed calculations to its outside accountant via facsimile within two (2) business days of receipt of the Notice of Conversion. The accountant shall audit the calculations and notify the Company and the holder of the results no later than 48 hours from the time it receives the disputed calculations. The accountant's calculation shall be deemed conclusive absent manifest error.
(c) Upon the surrender of the Debenture as described above accompanied by the Notice of Conversion, the Company shall issue and, within two (2) business days (the "Delivery Period") after such surrender (or, in the case of lost, stolen or destroyed Debenture, after provision of an agreement and indemnification by the holder to the Company), direct its transfer agent to deliver to or upon the order of the holder (i) that number of shares of Common Stock for the portion of the Debenture converted as shall be determined in accordance herewith and (ii) a new Debenture representing the balance of the principal amount of the Debenture surrendered but not converted, if any. In addition to any other remedies available to the holder, including actual damages and/or equitable relief, the Company shall pay to the holder $250 in cash for the third day beyond such Delivery Period that the Company fails to deliver Common Stock issuable upon surrender of the Debenture with a Notice of Conversion, and $500 per day in cash for each day thereafter, until such time as the earlier of the date that the Company has delivered all such Common Stock and the tenth day beyond such Delivery Period. Such cash amount shall be paid to such holder by the fifth day of the month following the month in which it has accrued. In the event the Company fails to deliver such Common Stock prior to the expiration of five (5) business days after the Delivery Period for any reason (whether due to a requirement of law or a stock exchange or otherwise), the holder shall be entitled to a 1% discount on the Conversion Price for the next conversion noticed by such holder to the Company. In the event the Company fails to deliver such Common Stock prior to the expiration of the ten (10) business day period after the Delivery Period for any reason (whether due to a requirement of law or a stock exchange or otherwise), such holder shall be entitled to (in addition to any other remedies available to the holder) Conversion Default Payments in accordance with Section 2(h) hereof beginning on the expiration of such ten (10) business day period.
(d) If any conversion of this Debenture would result in a fractional share of Common Stock or the right to acquire a fractional share of Common Stock, such fractional share shall be disregarded and Company disregarded.
(e) The "Conversion Date" shall pay be the date specified in cash the Notice of Conversion, provided (i) that the advance copy of the Notice of Conversion is faxed to the Company before 5:00 p.m., Mountain time, on the Conversion Date, and (ii) that the original Debenture is surrendered along with a copy of the Notice of Conversion as soon as practicable thereafter to the office of the Company or the transfer agent for the Debentures. The person or persons entitled to received the shares of Common Stock issuable upon conversion shall be treated for all purposes as the record holder the value or holders of such fractional securities as of the Conversion Date and all rights with respect to the Debenture fully surrendered shall forthwith terminate except the right to receive the shares of Common Stock or other securities or property issuable on such conversion.
(f) The Conversion Price per share based on ( "Conversion Price") at which shares of Common Stock shall be issuable upon conversion of this Debenture shall be equal to 100% of the Market Price on the business day immediately preceding the Conversion Date; provided, however, that the Conversion Price shall not exceed the Ceiling Price (defined below). "Market Price" shall mean the average of the two lowest closing bid prices of the Common Stock as reported by The Nasdaq Stock Market over the sixty trading day period ending on the date in question. The "Ceiling Price" shall mean 120% of the average closing bid price of the Common Stock for the twenty trading days prior to the effective date of the registration statement contemplated by the Registration Rights Agreement entered into by and between the parties on July __, 1998; provided, however, that the Ceiling Price shall be adjusted effective upon the second anniversary of the Purchase Agreement to 120% of the Market Price on such date, if such adjustment would result in a lower price, but in no event shall the Ceiling Price be adjusted to an amount less than $2.25.
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