NEXSAN CORPORATION
RESTRICTED STOCK PURCHASE AGREEMENT
Unless otherwise defined herein, capitalized terms defined in the 2001
Stock Plan (the "Plan") of Nexsan Corporation (the "Company") shall have the
same meanings when used in this Restricted Stock Purchase Agreement (the
"Agreement").
I. NOTICE OF GRANT OF STOCK PURCHASE RIGHT
BEECHTREE CAPITAL, LLC ( the "Purchaser")
You have been granted the right to purchase Common Stock of the
Company, subject to the terms and conditions of this Agreement (the
"Agreement"), as follows:
Grant Number 5
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Date of Grant
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Exercise Price Per Share $0.66
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Total Number of Shares Subject to This Stock
Purchase Right ("Shares") 500,000
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Non-Transferability of Stock Purchase Right.
This Stock Purchase Right may not be transferred in any manner and may be
exercised only by Purchaser. The terms of the Plan and this Agreement shall be
binding upon successors and assigns of the Purchaser.
II. AGREEMENT
1. Sale of Stock. The Company hereby agrees to sell to the Purchaser, and
the Purchaser hereby agrees to purchase the number of Shares set forth above in
the Notice of Grant of Stock Purchase Right, at the exercise price per share set
forth in the Notice of Grant of Stock Purchase Right (the "Exercise Price"), and
subject to the terms and conditions of the Plan, which is incorporated herein by
reference. Subject to Section 14(c) of the Plan, in the event of a conflict
between the terms and conditions of the Plan and this Agreement, the terms and
conditions of the Plan shall prevail.
2. Payment of Purchase Price. Purchaser herewith (i) delivers to the
Company the aggregate Exercise Price for the Shares by promissory note ("Note")
in the form of Exhibit A hereto, (ii) pledges the Shares to the Company to
secure the Note pursuant to a Pledge
Agreement in the form of Exhibit B attached hereto and (iii) assigns the Shares
pursuant to an Assignment Separate From Certificate in the form of Exhibit B-1.
3. Purchaser's Representations. In the event the Shares have not been
registered under the Securities Act of 1933, as amended, at the time this Stock
Purchase Right is exercised, the Purchaser shall, if required by the Company,
concurrently with the exercise of all or any portion of this Stock Purchase
Right, deliver to the Company his or her Investment Representation Statement in
the form attached hereto as Exhibit C.
4. Repurchase Option.
(a) In the event the Purchaser's continuous status as an independent
consultant ("Service Provider") terminates for any or no reason (including death
or Disability), the Company shall, upon the date of such termination (as
reasonably fixed and determined by the Company), have an irrevocable, exclusive
option (the "Repurchase Option") for a period of sixty (60) days from such date
to repurchase up to that number of shares which constitute the Unvested Shares
(as defined in Section 5) at the Exercise Price per share, plus interest at the
rate of interest set forth in the Note (the "Repurchase Price").
(b) The Repurchase Option shall be exercised by the Company by
delivering written notice to the Purchaser or the Purchaser's executor (with a
copy to the Escrow Holder (as defined in Section 7)) and, at the Company's
option, (i) by delivering to the Purchaser or the Purchaser's executor a check
in the amount of the aggregate Repurchase Price, or (ii) by the Company
canceling an amount of the Purchaser's indebtedness to the Company equal to the
aggregate Repurchase Price, or (iii) by a combination of (i) and (ii) so that
the combined payment and cancellation of indebtedness equals such aggregate
Repurchase Price. Upon delivery of such notice and the payment of the aggregate
Repurchase Price in any of the ways described above, the Company shall become
the legal and beneficial owner of the Unvested Shares being repurchased and all
rights and interests therein or relating thereto, and the Company shall have the
right to retain and transfer to its own name the number of Unvested Shares being
repurchased by the Company.
(c) Whenever the Company shall have the right to repurchase the
Unvested Shares hereunder, the Company may designate and assign one or more
employees, officers, directors or shareholders of the Company or other persons
or organizations to exercise all or a part of the Company's Repurchase Option to
purchase all or a part of the Unvested Shares. If the Fair Market Value of the
Unvested Shares to be repurchased on the date of such designation or assignment
(the "Repurchase FMV") exceeds the aggregate Repurchase Price of the Unvested
Shares, then each such designee or assignee shall pay the Company cash equal to
the difference between the Repurchase FMV and the aggregate Repurchase Price of
Unvested Shares to be purchased.
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(d) If the Company or its assignee does not elect to exercise the
Repurchase Option conferred above by giving the requisite notice within sixty
(60) days following Purchaser's termination as a Service Provider, the
Repurchase Option shall terminate.
5. Release of Shares From Repurchase Option (Vesting).
(a) All of the Shares purchased pursuant to this Agreement shall be
released from the Repurchase Option (sometimes hereafter referred to as "vest"
or "vesting") on January 1, 2002.
(b) Any of the Shares which have not yet been released from the
Company's Repurchase Option are referred to herein as "Unvested Shares."
(c) In the event that Purchaser's relationship as a Service Provider
with the Company shall terminate prior to the vesting of all Shares purchased
under this Agreement all Unvested Shares shall cease to vest pursuant to this
Agreement.
6. Restriction on Transfer. Except for the escrow described in Section 7 of
this Agreement or transfer of the Shares to the Company or its assignees
contemplated by this Agreement or the Pledge Agreement (in the form
attached hereto as Exhibit B), none of the Shares or any beneficial
interest therein shall be transferred, encumbered or otherwise disposed of
in any way until the release of such Shares from the Company's Repurchase
Option in accordance with the provisions of this Agreement.
7. Escrow of Shares.
(a) To ensure the availability for delivery of the Purchaser's
Unvested Shares upon exercise of the Repurchase Option by the Company, the
Purchaser shall, upon execution of this Agreement, deliver and deposit with
an escrow holder designated by the Company (the "Escrow Holder") and
reasonably acceptable to the Purchaser the share certificates representing
the Unvested Shares, together with the Assignment Separate from Certificate
(the "Stock Assignment") duly endorsed in blank, in the form attached
hereto as Exhibit D. The Unvested Shares and Stock Assignment shall be held
by the Escrow Holder, pursuant to the Joint Escrow Instructions of the
Company and Purchaser in the form attached as Exhibit E hereto, until such
time as the Company's Repurchase Option expires.
(b) The Escrow Holder shall not be liable for any act it may do or
omit to do with respect to holding the Unvested Shares in escrow and while
acting in good faith and in the exercise of its judgment.
(c) If the Company or any assignee exercises its Repurchase Option
hereunder, the Escrow Holder, upon receipt of written notice of such option
exercise from the proposed transferee, shall take all steps necessary to
accomplish such transfer.
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(d) When the Repurchase Option has been exercised or expires
unexercised, and a portion of the Shares has been released from such
Repurchase Option, the Escrow Holder shall promptly upon request, but not
more frequently than once each year, cause a new certificate to be issued
for such released Shares and shall deliver such certificate to the Company
or the Purchaser, as the case may be.
(e) Subject to the terms hereof, the Purchaser shall have all the
rights of a shareholder with respect to such Shares while they are held in
escrow, including without limitation, the right to vote the Shares and
receive any cash dividends declared thereon. If, from time to time during
the term of the Company's Repurchase Option, there is (i) any stock
dividend, stock split or other change in the Shares, or (ii) any merger or
sale of all or substantially all of the assets or other acquisition of the
Company, any and all new, substituted or additional securities to which the
Purchaser is entitled by reason of the Purchaser's ownership of the Shares
shall be immediately subject to this escrow, deposited with the Escrow
Holder and included thereafter as "Shares" for purposes of this Agreement
and the Company's Repurchase Option.
8. Company's Right of First Refusal. Before any Shares held by
Purchaser or any transferee (either being sometimes referred to herein
as the "Holder") may be sold or otherwise transferred (including
transfer by gift or operation of law), the Company or its assignee(s)
shall have a right of first refusal to purchase the Shares on the
terms and conditions set forth in this Section (the "Right of First
Refusal").
(a) Notice of Proposed Transfer. The Holder of the Shares shall
deliver to the Company a written notice (the "Notice") stating: (i) the
Holder's bona fide intention to sell or otherwise transfer such Shares;
(ii) the name of each proposed purchaser or other transferee ("Proposed
Transferee"); (iii) the number of Shares to be transferred to each Proposed
Transferee; and (iv) the bona fide cash price or other consideration for
which the Holder proposes to transfer the Shares (the "Offered Price"), and
the Holder shall offer the Shares at the Offered Price to the Company or
its assignee(s).
(b) Exercise of Right of First Refusal. At any time within thirty (30)
days after receipt of the Notice, the Company and/or its assignee(s) may,
by giving written notice to the Holder, elect to purchase all or part of
the Shares proposed to be transferred to any one or more of the Proposed
Transferees, at the purchase price determined in accordance with subsection
(c) below.
(c) Purchase Price. The purchase price ("Purchase Price") for the
Shares purchased by the Company or its assignee(s) under this Section shall
be (i) the Offered Price in the case of Shares that are vested or (ii) in
the case of Shares that are Unvested Shares, the lower of the Offered Price
or the Repurchase Price as defined in Section 4(a) hereof. If the Offered
Price includes consideration other than cash, the cash equivalent value of
the non-cash consideration shall be determined by the Board of Directors of
the Company in good faith.
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(d) Payment. Payment of the Purchase Price shall be made, at the
option of the Company or its assignee(s), (i) by cash or check, (ii) by
cancellation of all or a portion of any outstanding indebtedness of the
Holder to the Company (or, in the case of repurchase by an assignee, to the
assignee), or (iii) by any combination thereof within thirty (30) days
after receipt of the Notice or in the manner and at the times set forth in
the Notice.
(e) Holder's Right to Transfer. If Shares proposed in the Notice to be
transferred to a given Proposed Transferee are not purchased by the Company
and/or its assignee(s) as provided in this Section, then the Holder may
sell or otherwise transfer such Shares, that are not repurchased by the
Company, to that Proposed Transferee at the Offered Price or at a higher
price, provided that such sale or other transfer is consummated within one
hundred twenty (120) days after the date of the Notice and provided further
that any such sale or other transfer is effected in accordance with any
applicable securities laws and the Proposed Transferee agrees in writing
that the provisions of this Section shall continue to apply to the Shares
in the hands of such Proposed Transferee. If the Shares described in the
Notice are not transferred to the Proposed Transferee within such period, a
new Notice shall be given to the Company, and the Company and/or its
assignees shall again be offered the Right of First Refusal before any
Shares held by the Holder may be sold or otherwise transferred.
(f) Termination of Right of First Refusal. The Right of First Refusal
shall terminate as to any Shares upon the date of the first sale of Common
Stock of the Company to the general public pursuant to a registration
statement filed with and declared effective by the Securities and Exchange
Commission under the 1933 Act.
9. Restrictive Legends; Stop-Transfer Orders; Refusal to Transfer.
(a) Purchaser understands and agrees that the Company shall cause the
legends set forth below or legends substantially equivalent thereto, to be
placed upon any certificate(s) evidencing ownership of the Shares together
with any other legends that may be required by the Company or by applicable
state or federal securities laws:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL
REGISTERED UNDER THE ACT OR, IN THE OPINION OF COUNSEL SATISFACTORY TO
THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE
OR HYPOTHECATION IS IN COMPLIANCE THEREWITH.
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFER, A RIGHT OF FIRST REFUSAL, AND A REPURCHASE
OPTION
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HELD BY THE ISSUER OR ITS ASSIGNEE(S) AS SET FORTH IN THE RESTRICTED
STOCK PURCHASE AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF
THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE
OF THE ISSUER. SUCH TRANSFER RESTRICTIONS, RIGHT OF FIRST REFUSAL AND
REPURCHASE OPTION ARE BINDING ON TRANSFEREES OF THESE SHARES.
(b) Stop-Transfer Notices. Purchaser agrees that, in order to ensure
compliance with the restrictions referred to herein, the Company may issue
appropriate "stop transfer" instructions to its transfer agent, if any, and
that, if the Company transfers its own securities, it may make appropriate
notations to the same effect in its own records.
(c) Refusal to Transfer. The Company shall not be required (i) to
transfer on its books any Shares that have been sold or otherwise transferred in
violation of any of the provisions of this Agreement or (ii) to treat as owner
of such Shares or to accord the right to vote or pay dividends to any purchaser
or other transferee to whom such Shares shall have been so transferred.
10. Lock-Up Period. Purchaser hereby agrees that, if so requested by the
Company or any representative of the underwriters (the "Managing Underwriter")
in connection with any registration of the offering of any securities of the
Company under the Securities Act, Purchaser (or any transferee under Section 8
of this Agreement) shall not sell or otherwise transfer any Shares or other
securities of the Company during the 180-day period (or such shorter period as
may be requested in writing by the Managing Underwriter and agreed to in writing
by the Company) (the "Market Standoff Period") following the effective date of a
registration statement of the Company filed under the Securities Act. Such
restriction shall apply only to the first registration statement of the Company
to become effective under the Securities Act that includes securities to be sold
on behalf of the Company to the public in an underwritten public offering under
the Securities Act. The Company may impose stop-transfer instructions with
respect to securities subject to the foregoing restrictions until the end of
such Market Standoff Period.
11. Tax Consequences. Set forth below is a brief summary as of the date of
grant of this Stock Purchase Right of some of the federal tax consequences of
exercise of this Stock Purchase Right and disposition of the Shares. THIS
SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT
TO CHANGE.
(a) Exercise of Stock Purchase Right. Generally, no income will be
recognized by Purchaser in connection with the exercise of the stock purchase
right for shares subject to the Repurchase Option, unless an election under
Section 83(b) of the Code is filed with the Internal Revenue Service within 30
days of the date of exercise of the right to purchase stock. The form for making
this election is attached as Exhibit F hereto. Otherwise, as the Company's
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repurchase right lapses, Purchaser will recognize compensation income in an
amount equal to the difference between the Fair Market Value of the stock at the
time the Company's repurchase right lapses and the amount paid for the stock, if
any (the "Spread"). If Purchaser is a Service Provider or former Service
Provider, the Spread will be subject to tax withholding by the Company, and the
Company will be entitled to a tax deduction in the amount at the time the
Purchaser recognizes ordinary income with respect to a Stock Purchase Right.
(b) Disposition of Shares. Upon disposition of the Shares, any gain or
loss is treated as capital gain or loss. If the Shares are held for more than
one year, any gain realized on disposition of the shares will be treated as
long-term capital gain for federal income tax purposes. Long-term capital gains
are grouped and netted by holding periods. Net capital gains on assets held for
more than 12 months is capped at 20%. Capital losses are allowed in full against
capital gains, and up to $3,000 against other income.
THE PURCHASER ACKNOWLEDGES THAT IT IS THE PURCHASER'S SOLE
RESPONSIBILITY AND NOT THE COMPANY'S TO FILE TIMELY THE ELECTION UNDER SECTION
83(b), EVEN IF THE PURCHASER REQUESTS THE COMPANY OR ITS REPRESENTATIVES TO MAKE
THIS FILING ON THE PURCHASER'S BEHALF.
12. No Guarantee of Continued Service. PURCHASER ACKNOWLEDGES AND AGREES
THAT THE RELEASE OF SHARES FROM THE REPURCHASE OPTION OF THE COMPANY PURSUANT TO
PARAGRAPH 5 HEREOF IS EARNED ONLY BY CONTINUING SERVICE AS SERVICE PROVIDER (NOT
THROUGH THE ACT OF BEING HIRED OR PURCHASING SHARES HEREUNDER). PURCHASER
FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS
CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT
CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE
PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL.
13. Notices. Any notice, demand or request required or permitted to be
given by either the Company or the Purchaser pursuant to the terms of this
Agreement shall be in writing and may be delivered by hand, by nationally
recognized private courier, or by certified mail. Notices delivered by hand or
by nationally recognized private courier shall be deemed given when delivered
personally to the addressee or to the courier, or if given by certified mail
when deposited in the U.S. mail, certified and with postage prepaid, and
addressed to the parties at the addresses of the parties set forth at the end of
this Agreement or such other address as a party may request by notifying the
other in writing.
Any notice to the Escrow Holder shall be sent to the Company's address with
a copy to the other party not sending the notice.
14. No Waiver. Either party's failure to enforce any provision or
provisions of this Agreement shall not in any way be construed as a waiver of
any such provision or provisions, nor
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prevent that party from thereafter enforcing each and every other provision of
this Agreement. The rights granted both parties herein are cumulative and shall
not constitute a waiver of either party's right to assert all other legal
remedies available to it under the circumstances.
15. Successors and Assigns. The Company may assign any of its rights under
this Agreement to single or multiple assignees, and this Agreement shall inure
to the benefit of the successors and assigns of the Company. Subject to the
restrictions on transfer herein set forth, this Agreement shall be binding upon
Purchaser its successors and assigns.
16. Interpretation. Any dispute regarding the interpretation of this
Agreement shall be submitted by Purchaser or by the Company forthwith to the
Administrator which shall review such dispute at its next regular meeting. The
resolution of such a dispute by the Administrator shall be final and binding on
all parties.
17. Governing Law; Severability. This Agreement is governed by the internal
substantive laws, but not the choice of law rules, of New York.
18. Entire Agreement. The Plan is incorporated herein by reference. This
Agreement (including the exhibits referenced herein), the Plan and the
Investment Representation Statement constitute the entire agreement of the
parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Purchaser with
respect to the subject matter hereof, and may not be modified adversely to the
Purchaser's interest except by means of a writing signed by the Company and
Purchaser.
By Purchaser's signature below, Purchaser represents that he or she is
familiar with the terms and provisions of the Plan, and hereby accepts this
Agreement subject to all of the terms and provisions thereof. Purchaser has
reviewed the Plan and this Agreement in their entirety, has had an opportunity
to obtain the advice of counsel prior to executing this Agreement and fully
understands all provisions of this Agreement. Purchaser agrees to accept as
binding, conclusive and final all decisions or interpretations of the
Administrator upon any questions
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arising under the Plan or this Agreement. Purchaser further agrees to notify the
Company upon any change in the residence indicated in the Notice of Grant of
Stock Purchase Right.
BEECHTREE CAPITAL, LLC NEXSAN CORPORATION
Address: Address:
1 Rockefeller Plaza C/o Beechtree Capital, Ltd.
▇▇▇▇▇ ▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
By:/s/ ▇▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
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Name Printed: ▇▇▇▇▇▇ ▇▇▇▇▇ Name Printed: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Managing Member Title: CEO
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PROMISSORY NOTE
$330,000 January 4, ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
FOR VALUE RECEIVED, the undersigned, BEECHTREE CAPITAL, LLC, (the "Payor"),
with an address at ▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, promises
to pay to the order of Nexsan Corporation, a Delaware corporation ("Payee") with
offices at c/o Beechtree Capital Ltd., ▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇, the principal amount of Three Hundred and Thirty Thousand
($330,000) Dollars, in such coin or currency of the United States of America as
at the time of payment shall be legal tender for the payment of public or
private debts, together with interest thereon at the rate of 5.61% per annum.
Interest accrued hereunder shall be due and payable on the stated or any
accelerated maturity date, and the principal amount hereof, together with all
accrued but unpaid interest thereon, shall be paid on the third anniversary of
the date hereof.
This Note is issued by the Payor as payment in connection with the purchase
by the Payor of five hundred thousand (500,000) shares of the common stock
("Common Stock") of the Payee pursuant to a Restricted Stock Purchase Agreement
dated the date hereof and is entitled to the benefits thereof.
1. Events of Default.
a. Upon the occurrence of any of the following events (hereinafter called
"Events of Default") which shall have occurred and be continuing:
(i) The Payor shall default in any payment of principal or interest
due under this Note and fail to cure such default within ten days after
notice thereof;
(ii) (1) The Payor shall commence any proceeding or other action
relating to him in bankruptcy or seek readjustment of his debts,
receivership, composition or any other relief under the Bankruptcy Act, as
amended, or under any other insolvency, readjustment of debt or any other
similar act or law, of any jurisdiction, domestic or foreign, now or
hereafter existing; or (2) the Payor shall admit the material allegations
of any petition or pleading in connection with any such proceeding; or (3)
the Payor makes a general assignment for the benefit of his creditors;
(iii) (1) The commencement of any proceedings or the taking of
any other action against the Payor in bankruptcy or seeking the
reorganization, arrangement or readjustment of his debts, or any other
relief under the Bankruptcy Act, as amended, or under any other
insolvency, readjustment of debt or any other similar act or law of
any jurisdiction, domestic or foreign, now or hereafter existing and
the continuance of any of such events for sixty (60) days undismissed,
unbonded or undischarged; or (2) the issuance of a warrant of
attachment, execution or similar process against substantially all of
the property of the Payor and the continuance of such event for thirty
(30) days undismissed, unbonded and undischarged; or
(iv) (1) The Payor voluntarily elects to terminate his or her
consulting agreement with, or his or her arrangement for the provision of
services to, the Payee, or (2) the Payee elects to terminate the Payor's
consulting agreement for Cause, as such term is defined in the
10
Option Plan, then, and in any such event, the Payee may, by written notice
to the Payor, declare the entire unpaid principal amount of this Note,
together with all accrued but unpaid interest thereon, due and payable, and
the same shall forthwith become due and payable upon without presentment,
demand, protest, or other notice of any kind, all of which are expressly
waived.
b. Non-Waiver and Other Remedies. No course of dealing or delay on the
part of the holder of this Note in exercising any right hereunder shall operate
as a waiver thereof or otherwise prejudice the rights of the holder of this
Note. No remedy conferred hereby shall be exclusive of any other remedy referred
to herein or now or hereafter available at law, in equity, by statute or
otherwise.
2. Security.
(a) Pledge Agreement. This Note is secured by a Pledge Agreement
between the Payor and the Payee, dated of even date herewith (the "Pledge
Agreement"), pursuant to which the Payor has pledged the Common Stock as
collateral for payment hereunder.
(b) Recourse. No recourse under or upon any obligation, covenant or
agreement of this Note, or for any claim based hereon or otherwise in respect
hereof, shall be had against the Payor or his assigns, except (i) for accrued
and unpaid interest, and (ii) in the event the amount actually applied to the
payment of principal of this Note after payment of costs and expenses and
accrued but unpaid interest hereon upon any sale by the Payee of the Common
Stock (or any other collateral held as security for this Note) pursuant to
Section 3 of the Pledge Agreement, or otherwise, is less than the original
principal amount hereof, then this Note shall be with recourse to the Payor as
to accrued and unpaid interest hereon, and to not more than thirty three and
one-third percent (33 1/3 %) of the principal remaining unpaid immediately prior
to such application.
3. Prepayment. The indebtedness evidenced by this Note may be prepaid by
the Payor at any time in whole or in part from time to time, without premium or
penalty, provided that any prepayment of any portion of the outstanding
principal amount hereof shall be accompanied by all accrued but unpaid interest
thereon.
4. Lost Documents. Upon receipt by the Payor of evidence reasonably
satisfactory to him of the loss, theft, destruction or mutilation of this Note
or any Note exchanged for it, and (in the case of loss, theft or destruction) of
indemnity reasonably satisfactory to him, and upon reimbursement to the Payor of
all reasonable expenses incidental thereto, and upon surrender and cancellation
of such Note, if mutilated, the Payor will make and deliver to the Payee in lieu
of such Note a new Note of like tenor and unpaid principal amount and dated as
of the original date of this Note.
5. No Presentment, etc. The Payor and any endorsers, sureties and
guarantors of this Note waive presentment for payment, demand, protest, notice
of protest and notice of dishonor hereof, and all other notices to which they
may be entitled.
6. Miscellaneous.
a. Parties in Interest. All covenants, agreements and undertakings in
this Note by and on behalf of any of the parties hereto shall bind and inure to
the benefit of the respective permitted successors and assigns of the parties
hereto whether so expressed or not.
b. Notices. All notices, requests, consents and demands shall be made
in writing and shall be sent, and deemed delivered, in the manner prescribed in
Paragraph 12 of the Pledge Agreement.
c. Waiver. The failure of the Payee to exercise any right or remedy
granted to him hereunder on any one or more instances, shall not constitute a
waiver of any default by the Payee, and all such rights and remedies shall
remain continuously in force. No delay or omission in the exercise or
enforcement by the Payee of any rights or remedies shall be construed as a
waiver of any right or remedy of the Payee; and no exercise or enforcement of
any such right or remedy shall be held to exhaust any other right or remedy of
the Payee.
d. Illegality. If any one or more of the provisions contained in this
Note shall for any reason be held to be invalid, illegal or unenforceable, such
invalidity, illegality or unenforceability shall not affect any other provisions
of this Note and this Note shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein.
e. Amendment. This Note may not be changed orally, but only by an
instrument in writing duly executed by the party against which enforcement of
any waiver, change, modification or discharge is sought.
f. Construction. This Note shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the State of New York.
IN WITNESS WHEREOF, this Note has been executed and delivered by the Payor
on the date specified above.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇▇▇▇▇, as Payor
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Title: Managing Member
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ACCEPTED:
NEXSAN CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
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Title: CEO
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