12% NOTE WITH AN OPTION TO CONVERT DUE APRIL 15, 2009
NEITHER
THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE HAVE
BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES
COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY,
MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM,
OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS
EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE
SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY
AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS SECURITY MAY BE PLEDGED
IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH
SECURITIES. PLEASE REVIEW THE ASSOCIATED TERM SHEET, RISK FACTORS AND THE
REPORTS THE COMPANY HAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED
(THE “EXCHANGE ACT”).
Original
Issue Date: April 15, 2008
Original
Conversion Price (subject to adjustment herein): $2.00
$__________
12%
NOTE
WITH AN OPTION TO CONVERT
DUE
APRIL
15,
2009
THIS
12%
UNSECURED NOTE
WITH
AN OPTION TO CONVERT
is one
of a series (the “Series”) of duly authorized and issued 12% unsecured notes
with an option to convert (this note, the “Note”
and
collectively with the other notes in the Series, the “Notes”)
in the
aggregate maximum principal amount for all Notes in this Series (“the Series”)
of up to One Million Dollars ($1,000,000) of Actiga Corporation, a Nevada
corporation, having a principal place of business at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ (the
“Company”).
The
Notes may be issued in any increment and the issuance thereof are not subject
to
the receipt by the Company of any minimum amount of financing being secured.
The
Notes are an unsecured obligation of the Company. The Notes are designated
as
the 12% unsecured Notes with an option to convert, due April 15, 2009.
FOR
VALUE
RECEIVED, the Company promises to pay to _______ or its registered assigns
(the
“Holder”),
or
shall have paid pursuant to the terms hereunder, the principal sum of ($______)
by April 15, 2009, or such earlier date as this Note is permitted to be repaid
as provided hereunder (the “Maturity
Date”),
and
to pay interest to the Holder on the aggregate unconverted and then outstanding
principal amount of this Note in accordance with the provisions hereof. This
Note is subject to the following additional provisions:
Section
1. Definitions.
For the
purposes hereof, in addition to the terms defined elsewhere in this Note: (a)
capitalized terms not otherwise defined herein have the meanings given to such
terms in the Transaction Documents (hereinafter defined), and (b) the following
terms shall have the following meanings:
“Subsequent
Financing”
means
a
debt or equity financing in which the Company has raised the aggregate amount
of
at least $3,000,000.
“Adjusted
Conversion Price”
shall
be equal to the lesser of: (i) $2.00 or (ii) the lowest price at which the
securities are issued in the Subsequent Financing (the “Adjusted Conversion
Price”).
“Business
Day”
means
any day except Saturday, Sunday and any day which shall be a federal legal
holiday in the United States or a day on which banking institutions in the
State
of California are authorized or required by law or other government action
to
close.
“Common
Stock”
means
the common stock, par value $.001 per share, of the Company and stock of any
other class of securities into which such securities may hereafter have been
reclassified or changed into.
"Common
Stock Equivalent"
means
any warrant, option, subscription or purchase right with respect to shares
of
Common Stock, any security convertible into, exchangeable for, or otherwise
entitling the holder thereof to acquire, shares of Common Stock or any warrant,
option, subscription or purchase right with respect to any such convertible,
exchangeable or other security.
“Conversion
Date”
shall
have the meaning set forth in Section 4(a).
“Conversion
Price”
shall
have the meaning set forth in Section 4(b).
“Conversion
Shares”
means
the shares of Common Stock issuable upon conversion of this Note or as payment
of interest in accordance with the terms.
“Note
Register”
shall
have the meaning set forth in Section 3(b).
“Exchange
Act”
means
the Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder.
“Maturity
Date”
means
April 15, 2009.
“New
York Courts”
shall
have the meaning set forth in Section 8(d).
2
“Notice
of Conversion”
shall
have the meaning set forth in Section 4(a).
“Optional
Redemption Amount”
shall
mean the sum of: (i) 100% of the principal amount of the Note then outstanding,
and (ii) the entire amount of the due and unpaid interest that in no event
exceed $120,000, assuming the maximum amount of $1,000,000 is
raised.
“Optional
Redemption Notice”
shall
have the meaning set forth in Section 5(a).
“Optional
Redemption Notice Date”
shall
have the meaning set forth in Section 5(a).
“Original
Issue Date”
shall
mean the date of the first issuance of the Note.
“Person”
means
a
corporation, an association, a partnership, organization, a business, an
individual, a government or political subdivision thereof or a governmental
agency.
“Purchaser
Questionnaire”
means
the questionnaire completed by the holder and dated as of April 15,
2008.
“Subscription
Agreement”
means
the Securities Subscription Agreement, dated as of April 15, 2008, to which
the
Company and the original Holder are parties, as amended, modified or
supplemented from time to time in accordance with its terms.
“Registration
Rights”
means
the piggy back registration rights set forth in Section 6.
“Securities
Act”
means
the Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder.
“Trading
Day”
means
a
day on which the Common Stock is traded on a Trading Market.
“Trading
Market”
means
any of the following markets or exchanges on which the Common Stock is listed
or
quoted for trading on the date in question: the Nasdaq Capital Market, the
American Stock Exchange, the New York Stock Exchange, the Nasdaq National Market
or the OTC Bulletin Board.
“Transaction
Documents”
shall
mean the Term Sheet, the Note, the Subscription Agreement and the Purchaser
Questionnaire.
Section
2. Interest.
a) Payment
of Interest in Cash.
The
Company shall pay interest to the Holder on the aggregate unconverted and then
outstanding principal amount of this Note at the rate of 12% per annum, payable
in cash on the Maturity Date, except as otherwise provided.
3
b) Prepayment.
Except
as otherwise set forth in this Note including, but not limited to, Section
5(a),
the Company may not prepay any portion of the principal amount of this Note.
Section
3. Registration
of Transfers and Exchanges.
a) Investment
Representations.
This
Note has been issued subject to certain investment representations of the
original Holder set forth in the Subscription Agreement and the Purchaser
Questionnaire and may be transferred or exchanged only in compliance with the
Subscription Agreement and applicable federal and state securities laws and
regulations.
b) Reliance
on Note Register.
Prior
to due presentment to the Company for transfer of this Note, the Company and
any
agent of the Company may treat the person in whose name this Note is duly
registered on the Note Register as the owner hereof for the purpose of receiving
payment as herein provided and for all other purposes, whether or not this
Note
is overdue, and neither the Company nor any such agent shall be affected by
notice to the contrary.
Section
4. Conversion.
a) Voluntary
Conversion.
The
outstanding principal amount of this Note shall be convertible into shares
of
Common Stock, at the option of the Holder, (subject to the limitations on
conversion set forth in Section 4(d) hereof) at the Conversion Price at
either: (i) the date which is 10 Trading Days before the Maturity Date or (ii)
the Optional Redemption Notice Date, as applicable. The Holder shall effect
conversions by delivering to the Company the form of Notice of Conversion
attached hereto as Annex
A
(a
“Notice
of Conversion”),
specifying therein the principal amount of this Note to be converted and the
date on which such conversion is to be effected (a “Conversion
Date”).
If no
Conversion Date is specified in a Notice of Conversion, the Conversion Date
shall be the date that such Notice of Conversion is received hereunder. To
effect conversions hereunder, the Holder shall be required to physically
surrender this Note to the Company in the amount of the Note that the Holder
wishes to convert. Conversions hereunder shall have the effect of lowering
the
outstanding principal amount of this Note in an amount equal to the applicable
conversion. The Holder and the Company shall maintain records showing the
principal amount converted and the date of such conversion. The Company shall
deliver any objection to any Notice of Conversion promptly, but in no event
later than ten (10) Business Days after receipt of such notice. In the event
of
any dispute or discrepancy, the records of the Company shall be controlling
and
determinative in the absence of manifest error.
b) Conversion
Price.
The
conversion price in effect on any Conversion Date shall be equal to $2.00
(subject to adjustment herein)(the “Conversion
Price”).
4
c) ▇▇▇▇▇▇’s
Restriction on Conversion.
The
Company shall not effect any conversion of this Note, and the Holder shall
not
have the right to convert any portion of this Note, pursuant to Section 4(a)
or
otherwise, to the extent that after giving effect to such conversion, the Holder
(together with the Holder’s Affiliates), as set forth on the applicable Notice
of Conversion, would beneficially own in excess of 4.99% of the number of shares
of the Common Stock outstanding immediately after giving effect to such
conversion. For purposes of the foregoing sentence, the number of shares
of Common Stock beneficially owned by the Holder and its Affiliates shall
include the number of shares of Common Stock issuable upon conversion of this
Note with respect to which the determination of such sentence is being made,
but
shall exclude the number of shares of Common Stock which would be issuable
upon
(A) conversion of the remaining, nonconverted portion of this Note beneficially
owned by the Holder or any of its Affiliates and (B) exercise or conversion
of
the unexercised or nonconverted portion of any other securities of the Company
(including, without limitation, any other Notes) subject to a limitation on
conversion or exercise analogous to the limitation contained herein beneficially
owned by the Holder or any of its Affiliates. Except as set forth in the
preceding sentence, for purposes of this Section 4(c), beneficial ownership
shall be calculated in accordance with Section 13(d) of the Exchange Act and
the
rules and regulations promulgated thereunder. To the extent that the limitation
contained in this section applies, the determination of whether this Note is
convertible (in relation to other securities owned by the Holder) and of which
a
portion of this Note is convertible shall be in the sole discretion of such
Holder. To ensure compliance with this restriction, the Holder will be deemed
to
represent to the Company each time it delivers a Notice of Conversion that
such
Notice of Conversion has not violated the restrictions set forth in this
paragraph and the Company shall have no obligation to verify or confirm the
accuracy of such determination. In
addition, a determination as to any group status as contemplated above shall
be
determined in accordance with Section 13(d) of the Exchange Act and the rules
and regulations promulgated thereunder. For
purposes of this Section 4(c), in determining the number of outstanding shares
of Common Stock, the Holder may rely on the number of outstanding shares of
Common Stock as reflected in (x) the Company’s most recent Form 10-QSB or Form
10-K, as the case may be, (y) a more recent public announcement by the Company
or (z) any other notice by the Company or the Company’s Transfer Agent setting
forth the number of shares of Common Stock outstanding. Upon the written
or oral request of the Holder, the Company shall within two Trading Days confirm
orally and in writing to the Holder the number of shares of Common Stock then
outstanding. In any case, the number of outstanding shares of Common Stock
shall be determined after giving effect to the conversion or exercise of
securities of the Company, including this Note, by the Holder or its Affiliates
since the date as of which such number of outstanding shares of Common Stock
was
reported. The
provisions of this paragraph shall be implemented in a manner otherwise than
in
strict conformity with the terms of this Section 4(c) to correct this paragraph
(or any portion hereof) which may be defective or inconsistent with the intended
4.99% beneficial ownership limitation herein contained or to make changes or
supplements necessary or desirable to properly give effect to such 4.99%
limitation. The limitations contained in this paragraph shall apply to a
successor holder of this Note.
5
d) Mechanics
of Conversion
i. Conversion
Shares Issuable Upon Conversion of Principal Amount of Notes.
The
number of shares of Common Stock issuable upon a conversion hereunder shall
be
determined by the quotient obtained by dividing (x) the outstanding principal
amount of this Note to be converted by (y) the Conversion Price or the Alternate
Conversion Price, as applicable.
ii. Delivery
of Certificate Upon Conversion.
As soon
as commercially practicable after the applicable Conversion Date, the Company
will deliver or cause to be delivered to the Holder either (A) (i) a bank check
in the amount of the Note or (ii) a certificate or certificates representing
the
Conversion Shares representing the number of shares of Common Stock being
acquired upon the conversion of this Note and (B) a bank check in the amount
of
accrued and unpaid interest. The Company shall, if available and if allowed
under applicable securities laws, use its best efforts to deliver any
certificate or certificates required to be delivered by the Company under this
Section electronically through the Depository Trust Corporation or another
established clearing corporation performing similar functions.
iii. Failure
to Deliver Certificates.
If in
the case of any Notice of Conversion such certificate or certificates are not
delivered to or as directed by the applicable Holder as soon as commercially
practicable after the applicable Conversion Date, the Holder shall be entitled
by written notice to the Company at any time on or before its receipt of such
certificate or certificates thereafter, to rescind such conversion, in which
event the Company shall immediately return the certificates representing the
principal amount of this Note tendered for conversion.
iv. Reservation
of Shares Issuable Upon Conversion.
The
Company covenants that it will at all times reserve and keep available out
of
its authorized and unissued shares of Common Stock solely for the purpose of
issuance upon conversion of this Note free from preemptive rights or any other
actual contingent purchase rights of persons other than the Holder (and the
other holders of the Notes), not less than such number of shares of the Common
Stock as shall (subject to any additional requirements of the Company as to
the
reservation of such shares and the terms and conditions set forth in the
Subscription Agreement) be issuable upon the conversion of the outstanding
principal amount of this Note.
v. Fractional
Shares.
Upon a
conversion hereunder the Company shall not be required to issue stock
certificates representing fractions of shares of the Common Stock, but may
if
otherwise permitted, make a cash payment in respect of any final fraction of
a
share based on the VWAP at such time. If the Company elects not, or is unable,
to make such a cash payment, the Holder shall be entitled to receive, in lieu
of
the final fraction of a share, one whole share of Common Stock.
6
vi. Transfer
Taxes.
The
issuance of certificates for shares of the Common Stock on conversion of this
Note shall be made without charge to the Holder hereof for any documentary
stamp
or similar taxes that may be payable in respect of the issue or delivery of
such
certificate, provided that the Company shall not be required to pay any tax
that
may be payable in respect of any transfer involved in the issuance and delivery
of any such certificate upon conversion in a name other than that of the Holder
of this Note so converted and the Company shall not be required to issue or
deliver such certificates unless or until the person or persons requesting
the
issuance thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been
paid.
Section
5. Optional
Redemption.
a) Optional
Redemption at Election of Company. Subject to the provisions of this Section
5, at any time after the date upon which the Company consummates an Subsequent
Financing, the Company may deliver a notice to the Holder (an “Optional
Redemption Notice” and the date such notice is deemed delivered hereunder,
the “Optional Redemption Notice Date”) of its election to redeem the
Optional Redemption Amount on the 20th Trading Day following the
Optional Redemption Notice Date (such date, the “Optional Redemption
Date” and such redemption, the “Optional Redemption”). The Company
covenants and agrees that it will honor all Notices of Conversion tendered
from
the time of delivery of the Optional Redemption Notice through the date all
amounts owing thereon are due and paid in full.
b) Redemption
Procedure.
The
payment of cash pursuant to an Optional Redemption shall be made on the Optional
Redemption Date. The Company’s determination to redeem in cash or Holder’s
elections to convert into shares of common stock under Section 5(c) shall be
applied among the Holders of Notes ratably.
c) ▇▇▇▇▇▇’s
Election.
Subject
to the Company’s election to the Optional Redemption, the Holder may elect to
convert the outstanding principal amount of the Note into shares of common
stock
in lieu of cash at the Alternate Conversion Price by delivering a Notice of
Conversion to the Company in writing and sent by registered or certified mail
with return receipt requested (postage prepaid) to the address as set forth
on
the Subscription Agreement. Notwithstanding anything herein to the contrary,
the
Holder may not elect to convert into shares of common stock any portion of
the
interest on the Notes.
7
Section
6. Piggy
Back Registration.
(a) If,
at
any time, the Company undertakes to register any of its Common Stock or other
equity securities under the Securities Act of 1933, as amended (the “Act”),
other
than (i) a registration in connection with any employee stock option,
equity compensation plan or other benefit plan (ii) a registration statement
filed on Form S-3, (iii) a registration statement filed on Form S-8, the Company
will
give
prompt written notice (and in no event later than 30 days prior to the proposed
filing of such registration statement with the Securities and Exchange
Commission (the “SEC”)) to the Holder of its intention to effect such
registration. The Company will include in such registration all securities
with
respect to which the Company has received written requests for inclusion within
20 days after the receipt of such notice by the Holder. The Company shall pay
all related registration expenses other than any underwriter discounts relating
to shares to be sold by the Holder.
(b) In
connection with and registration of shares under the Act, the Company shall,
among other things, (i) file a registration statement with the SEC and use
its
reasonable best efforts to cause the registration statement to become and remain
effective until all of the shares have been sold or sixty days, whichever is
shorter, (ii) as promptly as possible prepare and file with the SEC any
amendments and supplements to any registration statement, including the
prospectus, that are necessary to keep such registration statement effective,
(iii) as promptly as possible, provide to the Holder copies of the prospectus,
including a preliminary prospectus, conforming with the requirements of the
Act,
and all other documents that the Holder may reasonably request, in order to
assist in the public sale or other disposition of the shares, and (iv) as
promptly as possible, use its commercially reasonable efforts to register or
qualify the shares covered by such registration statement under the securities
(Blue Sky) laws of all states that require such registration or qualification
and that the Holder requests, and complete all other activities and documents
that may be necessary or reasonably desirable for the Holder to complete the
public sale or other disposition of the shares in such specified
states.
(c) The
obligations of the Company under this Section to register the shares shall
expire and terminate at such time as the Holder shall be entitled or eligible
to
sell such securities without restriction and without a need for the filing
of a
registration statement under the Securities Act, including without limitation,
for any resales of restricted securities made pursuant to Rule 144 as
promulgated by the Securities and Exchange Commission, or for a sale made
pursuant to Rule 144 as promulgated by the Securities and Exchange Commission,
or for a sale made pursuant to Section 4(1) and/or 4(2) under the Securities
Act.
Section
7. Events
of Default.
a) “Event
of Default”,
wherever used herein, means any one of the following events (whatever the reason
and whether it shall be voluntary or involuntary or effected by operation of
law
or pursuant to any judgment, decree or order of any court, or any order, rule
or
regulation of any administrative or governmental body):
8
i. any
default in the payment of (A) the principal amount of this Note, or (B) interest
on this Note when the same shall become due and payable (whether on a Conversion
Date or the Maturity Date) which default, solely in the case of an interest
payment or other default under this clause is not cured, within a time frame
that is commercially reasonable;
ii. a
default
or event of default (subject to any grace or cure period provided for in the
applicable agreement, document or instrument) shall occur under any of the
Transaction Documents;
iii. (i)
the
Company shall commence a case, as debtor, a case under any applicable bankruptcy
or insolvency laws as now or hereafter in effect or any successor thereto,
or
the Company commences any other proceeding under any reorganization,
arrangement, adjustment of debt, relief of debtors, dissolution, insolvency
or
liquidation or similar law of any jurisdiction whether now or hereafter in
effect relating to the Company or (ii) there is commenced a case against the
Company, under any applicable bankruptcy or insolvency laws, as now or hereafter
in effect or any successor thereto which remains undismissed for a period of
60
days; or (iii) the Company is adjudicated by a court of competent jurisdiction
insolvent or bankrupt; or any order of relief or other order approving any
such
case or proceeding is entered; or (iv) the Company suffers any appointment
of
any custodian or the like for it or any substantial part of its property which
continues undischarged or unstayed for a period of 60 days; or (v) the Company
makes a general assignment for the benefit of creditors; or (vi) the Company
shall fail to pay, or shall state that it is unable to pay, or shall be unable
to pay, its debts generally as they become due; or (vii) the Company shall
call
a meeting of its creditors with a view to arranging a composition, adjustment
or
restructuring of its debts; or (viii) the Company shall by any act or failure
to
act expressly indicate its consent to, approval of or acquiescence in any of
the
foregoing; or (ix) any corporate or other action is taken by the Company for
the
purpose of effecting any of the foregoing;
b) Remedies
Upon Event of Default.
If any
Event of Default occurs, the full principal amount of this Note, together with
interest and other amounts owing in respect thereof, to the date of acceleration
shall become, at the Holder’s election, immediately due and payable in cash.
9
Section
8. Miscellaneous.
a) Notices.
Any and
all notices or other communications or deliveries to be provided by the Holder
hereunder, including, without limitation, any Notice of Conversion, shall be
in
writing and delivered to the Company sent by registered or certified mail with
return receipt requested (postage prepaid) at the address set forth above
Attn:
▇▇▇▇
▇▇▇▇▇▇▇▇, President or such other address as the Company may specify for such
purposes by notice to the Holder delivered in accordance with this Section.
Any
and all notices or other communications or deliveries to be provided by the
Company hereunder shall be in writing and delivered by facsimile, by email
to
the Subscriber’s email address as set forth on the signature page, sent by a
nationally recognized overnight courier service addressed to each Holder at
the
facsimile telephone number or address of such Holder appearing on the books
of
the Company, or if no such facsimile telephone number or address appears, at
the
principal place of business of the Holder. Any notice or other communication
or
deliveries hereunder shall be deemed given and effective on the earliest of
(i)
the date of transmission, if such notice or communication is delivered via
facsimile at the facsimile telephone number or email address prior to 5:30
p.m.
(Los Angeles, CA time), (ii) the date after the date of transmission, if such
notice or communication is delivered via facsimile or email at the facsimile
telephone number or email address specified in this Section later than 5:30
p.m.
(Los Angeles, CA time) on any date and earlier than 11:59 p.m. (Los Angeles,
CA
time) on such date, (iii) the second Business Day following the date of mailing,
if sent by nationally recognized overnight courier service, or (iv) upon actual
receipt by the party to whom such notice is required to be given.
b) Absolute
Obligation.
Except
as expressly provided herein, no provision of this Note shall alter or impair
the obligation of the Company, which is absolute and unconditional, to pay
the
principal of and interest on, this Note at the time, place, and rate, and in
the
coin or currency, herein prescribed. This Note is a direct debt obligation
of
the Company.
c) Lost
or Mutilated Note.
If this
Note shall be mutilated, lost, stolen or destroyed, the Company shall execute
and deliver, in exchange and substitution for and upon cancellation of a
mutilated Note, or in lieu of or in substitution for a lost, stolen or destroyed
Note, a new Note for the principal amount of this Note so mutilated, lost,
stolen or destroyed but only upon receipt of evidence of such loss, theft or
destruction of such Note, and of the ownership hereof, and indemnity, if
requested, all reasonably satisfactory to the Company.
10
d) Governing
Law.
All
questions concerning the construction, validity, enforcement and interpretation
of this Note shall be governed by and construed and enforced in accordance
with
the internal laws of the State of New York, without regard to the principles
of
conflicts of law thereof. Each party agrees that all legal proceedings
concerning the interpretations, enforcement and defense of the transactions
contemplated by any of the Transaction Documents (whether brought against a
party hereto or its respective affiliates, directors, officers, shareholders,
employees or agents) shall be commenced in the state and federal courts sitting
in the City of New York, Borough of Manhattan (the “New
York Courts”).
Each
party hereto hereby irrevocably submits to the exclusive jurisdiction of the
New
York Courts for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein
(including with respect to the enforcement of any of the Transaction Documents),
and hereby irrevocably waives, and agrees not to assert in any suit, action
or
proceeding, any claim that it is not personally subject to the jurisdiction
of
any such court, or such New York Courts are improper or inconvenient venue
for
such proceeding. Each party hereby irrevocably waives personal service of
process and consents to process being served in any such suit, action or
proceeding by mailing a copy thereof via registered or certified mail or
overnight delivery (with evidence of delivery) to such party at the address
in
effect for notices to it under this Note and agrees that such service shall
constitute good and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law. Each party hereto hereby irrevocably waives,
to
the fullest extent permitted by applicable law, any and all right to trial
by
jury in any legal proceeding arising out of or relating to this Note or the
transactions contemplated hereby.
e) Waiver.
Any
waiver by the Company or the Holder of a breach of any provision of this Note
shall not operate as or be construed to be a waiver of any other breach of
such
provision or of any breach of any other provision of this Note. The failure
of
the Company or the Holder to insist upon strict adherence to any term of this
Note on one or more occasions shall not be considered a waiver or deprive that
party of the right thereafter to insist upon strict adherence to that term
or
any other term of this Note. Any waiver must be in writing.
f) Severability.
If any
provision of this Note is invalid, illegal or unenforceable, the balance of
this
Note shall remain in effect, and if any provision is inapplicable to any person
or circumstance, it shall nevertheless remain applicable to all other persons
and circumstances. If it shall be found that any interest or other amount deemed
interest due hereunder violates applicable laws governing usury, the applicable
rate of interest due hereunder shall automatically be lowered to equal the
maximum permitted rate of interest. The Company covenants (to the extent that
it
may lawfully do so) that it shall not at any time insist upon, plead, or in
any
manner whatsoever claim or take the benefit or advantage of, any stay, extension
or usury law or other law which would prohibit or forgive the Company from
paying all or any portion of the principal of or interest on this Note as
contemplated herein, wherever enacted, now or at any time hereafter in force,
or
which may affect the covenants or the performance of this indenture, and the
Company (to the extent it may lawfully do so) hereby expressly waive all
benefits or advantage of any such law, and covenants that it will not, by resort
to any such law, hinder, delay or impeded the execution of any power herein
granted to the Holder, but will suffer and permit the execution of every such
as
though no such law has been enacted.
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g) Next
Business Day.
Whenever any payment or other obligation hereunder shall be due on a day other
than a Business Day, such payment shall be made on the next succeeding Business
Day.
h) Headings.
The
headings contained herein are for convenience only, do not constitute a part
of
this Note and shall not be deemed to limit or affect any of the provisions
hereof.
i) Assumption.
Any successor to the Company shall (i) assume in writing all of the obligations
of the Company under this Note and the other Transaction Documents pursuant
to
written agreements and (ii) issue to the Holder a new Note of such successor
entity evidenced by a written instrument substantially similar in form and
substance to this Note, including, without limitation, having a principal amount
and interest rate equal to the principal amounts and the interest rates of
the
Notes held by the Holder and having similar ranking to this Note, and
satisfactory to the Holder (any such approval not to be unreasonably withheld
or
delayed).
*********************
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IN
WITNESS WHEREOF, the Company has caused this Note to be duly executed by a
duly
authorized officer as of the date first above indicated.
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ACTIGA
CORPORATION
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|
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By:
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Name:
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|
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Title:
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HOLDER
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By:
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Name:
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Title:
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13
ANNEX
A
NOTICE
OF CONVERSION
The
undersigned hereby elects to convert principal under the 12% unsecured Note
with
an option to convert of Actiga Corporation, a Nevada corporation (the
“Company”),
due
on April 15, 2009, into shares of common stock, par value $.001 per share (the
“Common
Stock”),
of
the Company according to the conditions hereof, as of the date written below.
If
shares are to be issued in the name of a person other than the undersigned,
the
undersigned will pay all transfer taxes payable with respect thereto and is
delivering herewith such certificates and opinions as reasonably requested
by
the Company in accordance therewith. No fee will be charged to the holder for
any conversion, except for such transfer taxes, if any.
By
the
delivery of this Notice of Conversion the undersigned represents and warrants
to
the Company that its ownership of the Common Stock does not exceed the amounts
determined in accordance with Section 13(d) of the Exchange Act, specified
under
Section 4 of this Note.
The
undersigned agrees to comply with the prospectus delivery requirements under
the
applicable securities laws in connection with any transfer of the aforesaid
shares of Common Stock.
Conversion
calculations:
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Date
to Effect Conversion: __________________________
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Principal
Amount of Note to be Converted: ________
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Number
of shares of Common Stock to be issued:
_______
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Signature: _____________________________
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Name: _____________________________
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Address: _____________________________
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Email: _____________________________
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14