Exhibit 10.9
NOTE PURCHASE AGREEMENT
THIS NOTE PURCHASE AGREEMENT (this "Agreement") is made as of March __,
2004 by and between United Heritage Corporation, a Utah corporation (the
"Company"), and the purchaser whose name and address is set forth on the
signature page hereto ("Purchaser").
WHEREAS, pursuant to that certain Subscription Application of the
Purchaser, substantially in the form of EXHIBIT A, the Company desires to sell
to the Purchaser and the Purchaser desires to purchase from the Company a
convertible promissory note in the aggregate principal amount set forth on the
signature page hereto, which shall be convertible into shares of the Company's
common stock, $.001 par value per share (the "Common Stock"), on the terms and
subject to the conditions set forth in this Agreement and the other documents or
instruments contemplated hereby.
NOW, THEREFORE, the parties hereto hereby agree as follows:
Section 1. Sale and Issuance of the Note.
Upon the terms and subject to the conditions contained in this Agreement,
the Company has authorized the sale and issuance (the "Issuance") of convertible
promissory notes. At the Closing (as defined in Section 2.1), the Company shall
sell to the Purchaser, and the Purchaser shall purchase from the Company, upon
the terms set forth in this Agreement, one such convertible promissory note,
substantially in the form of EXHIBIT B attached hereto (the "Note"), in the
aggregate principal amount set forth on the signature page hereto. The Company
intends to enter into this same form of purchase agreement with certain other
investors and expects to complete sales of its convertible promissory notes to
them. The Purchaser's obligations hereunder are expressly not subject to or
conditioned on the purchase of notes by any or all of such other investors.
The Purchaser shall have the right and option, exercisable in its sole
discretion to convert the outstanding principal amount due hereunder into that
number of shares of Common Stock equal to the quotient obtained by dividing (A)
the outstanding principal amount of this Note by (B) $0.50. Additionally, upon
conversion, the Purchaser shall receive a warrant substantially in the form of
EXHIBIT C attached hereto (the "Warrant") to purchase two shares of the
Company's Common Stock for every one share of Common Stock converted pursuant to
Section 2 of the Note, such Warrant providing for exercise prices of $0.75 per
share for half of the shares underlying the Warrant and $1.00 per share for the
remaining shares underlying the Warrant. The Purchaser shall only have the right
to convert, if the Company's shareholders approve, at the Company's Annual
Meeting to be held on March 23, 2004, or such other date determined by the
Company's Board of Directors, the issuance by the Company of Common Stock equal
to 20% or more of the Common Stock outstanding before the issuance for less than
the greater of book or market value of the stock.
Section 2. The Closing.
2.1. The closing of the Issuance to the Purchaser (the "Closing") shall
take place, simultaneously with the execution and delivery of this Agreement at
the offices of ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, LLP, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
2.2 At the Closing, the Company shall deliver to the Purchaser a Note
registered in the name of such Purchaser in the aggregate principal amount to be
purchased by such Purchaser pursuant to Section 1, against receipt by the
Company of a certified bank check or wire transfer in an aggregate amount equal
to the purchase price therefor as set forth on the signature page hereto. The
wire transfer shall be sent pursuant to the following instructions:
Bank: Comerica Bank of California
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
ABA No.: ▇▇▇▇▇▇▇▇▇
Account No.: 1891937581
Account Name: ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, LLP Client Trust Account
Section 3. Representations and Warranties of the Company.
The Company hereby represents and warrants to the Purchaser as follows:
3.1. Organization.
The Company is duly organized, validly existing and in good standing under
the laws of the State of Utah and is qualified to conduct its business as a
foreign corporation in each jurisdiction where the failure to be so qualified
would have a material adverse effect on the Company.
3.2. Authorization of Agreement, Etc.
The execution, delivery and performance by the Company of this Agreement
and the Note and each other document or instrument contemplated hereby or
thereby (collectively, the "Financing Documents") have been duly authorized by
all requisite corporate action by the Company; and this Agreement and Note have
been duly executed and delivered by the Company. Each of the Financing
Documents, when executed and delivered by the Company, constitutes the valid and
binding obligation of the Company, enforceable against the Company in accordance
with its terms, subject to applicable bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium or other similar laws affecting creditors'
rights and remedies generally, and subject as to enforceability to general
principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).
Section 4. Representations and Warranties of the Purchaser.
The Purchaser hereby represents and warrants to the Company as follows:
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4.1. Authorization of the Documents.
Purchaser has all requisite power and authority (corporate or otherwise)
to execute, deliver and perform the Financing Documents to which it is a party
and the transactions contemplated thereby, and the execution, delivery and
performance by such Purchaser of the Financing Documents to which it is a party
have been duly authorized by all requisite action by such Purchaser and each
such Financing Document, when executed and delivered by the Purchaser,
constitutes a valid and binding obligation of such Purchaser, enforceable
against such Purchaser in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or
other similar laws affecting creditors' rights and remedies generally, and
subject, as to enforceability, to general principles of equity (regardless of
whether enforcement is sought in a proceeding at law or in equity).
4.2. Investment Representations.
All of the representations and warranties of the Purchaser contained in
Sections 2 and 3 of that certain United Heritage Corporation Subscription
Application executed by the Purchaser, a copy of which is attached hereto as
EXHIBIT A, are incorporated herein by this reference and shall be true at the
Closing with the same effect as though made at such time.
4.3 U.S.A. Patriot Act Representations
(A) Purchaser represents, warrants and covenants that Purchaser:
(i)(a) is subscribing for the Note for Purchaser's own account, own
risk and own beneficial interest, (b) is not acting as an agent, representative,
intermediary, nominee or in a similar capacity for any other person or entity,
nominee account or beneficial owner, whether a natural person or entity (each
such natural person or entity, an "Underlying Beneficial Owner") and no
Underlying Beneficial Owner will have a beneficial or economic interest in the
Note, or the Common Stock, being purchased by Purchaser (whether directly or
indirectly, including without limitation, through any option, swap, forward or
any other hedging or derivative transaction), (c) if it is an entity, including,
without limitation, a fund-of-funds, trust, pension plan or any other entity
that is not a natural person (each, an "Entity"), has carried out thorough due
diligence as to and established the identities of such Entity's investors,
directors, officers, trustees, beneficiaries and grantors (to the extent
applicable, each a "Related Person" of such Entity), holds the evidence of such
identities, will maintain all such evidence for at least five years from the
date of Purchaser's resale or other disposition of the Note and all the Common
Stock, will request such additional information as the Company may require to
verify such identities as may be required by applicable law, and will make such
information available to the Company upon its request, and (d) does not have the
intention or obligation to sell, pledge, distribute, assign or transfer all or a
portion of the Note or the Common Stock to any Underlying Beneficial Owner or
any other person; OR (CHECK AND INITIAL ONE BOX)
(ii)(a) is subscribing for the Note as a record owner and will not
have a beneficial ownership interest in the Note, (b) is acting as an agent,
representative, intermediary, nominee or in a similar capacity for one or more
Underlying Beneficial Owners (as defined in (A)(i)(a) above), and understands
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and acknowledges that the representations, warranties and agreements made in the
Financing Documents are made by Purchaser with respect to both Purchaser and the
Underlying Beneficial Owner(s), (c) has all requisite power and authority from
the Underlying Beneficial Owner(s) to execute and perform the obligations under
the Subscription Agreement, (d) has carried out thorough due diligence as to and
established the identities of all Underlying Beneficial Owners (and, if an
Underlying Beneficial Owner is not a natural person, the identities of such
Underlying Beneficial Owner's Related Persons (to the extent applicable)), holds
the evidence of such identities, will maintain all such evidence for at least
five years from the date of Purchaser's resale or other disposition of all the
Note or Common Stock, and will make such information available to the Company
upon its request and (e) does not have the intention or obligation to sell,
pledge, distribute, assign or transfer all or a portion of the Note or Common
Stock to any person other than the Underlying Beneficial Owner(s).
(B) Purchaser hereby represents and warrants that the proposed investment
in the Company that is being made on its own behalf or, if applicable, on behalf
of any Underlying Beneficial Owners does not directly or indirectly contravene
United States federal, state, local or international laws or regulations
applicable to Purchaser, including anti-money laundering laws (a "Prohibited
Investment").
(C) Federal regulations and Executive Orders administered by the U.S.
Treasury Department's Office of Foreign Assets Control ("OFAC") prohibit, among
other things, the engagement in transactions with, and the provision of services
to, certain foreign countries, territories, entities and individuals. The lists
of OFAC prohibited countries, territories, persons and entities can be found on
the OFAC website at ▇▇▇.▇▇▇▇▇.▇▇▇/▇▇▇▇. Purchaser hereby represents and warrants
that neither Purchaser nor, if applicable, any Underlying Beneficial Owner or
Related Person, is a country, territory, person or entity named on an OFAC list,
nor is Purchaser nor, if applicable, any Underlying Beneficial Owner or Related
Person, a natural person or entity with whom dealings are prohibited under any
OFAC regulations.
(D) Purchaser represents and warrants that neither Purchaser nor, if
applicable, any Underlying Beneficial Owner or Related Person, is a senior
foreign political figure, or any immediate family member or close associate of a
senior foreign political figure within the meaning of, and applicable guidance
issued by the Department of the Treasury concerning, the U.S. Bank Secrecy Act
(31 U.S.C. ss.5311 et seq.), as amended, and any regulations promulgated
thereunder.
(E) Purchaser agrees promptly to notify the Company should Purchaser
become aware of any change in the information set forth in paragraphs (A)
through (D).
(F) Upon the written request from the Company, Purchaser agrees to provide
all information to the Company to enable the Company to comply with all
applicable anti-money laundering statutes, rules, regulations and policies,
including any policies applicable to a portfolio investment held or proposed to
be held by the Company. Purchaser understands and agrees that the Company may
release confidential information about Purchaser and, if applicable, any
Underlying Beneficial Owner(s) or Related Person(s) to any person, if the
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Company, in its sole discretion, determines that such disclosure is necessary to
comply with applicable statutes, rules, regulations and policies.
(G) Purchaser agrees to indemnify and hold harmless the Company, its
affiliates, their respective directors, officers, shareholders, employees,
agents and representatives (each, an "Indemnitee") from and against any and all
losses, liabilities, damages, penalties, costs, fees and expenses (including
legal fees and disbursements) (collectively, "Damages") which may result,
directly or indirectly, from Purchaser's misrepresentations or misstatements
contained herein or breaches hereof relating to paragraphs (A) through (F).
(H) Purchaser understands and agrees that, notwithstanding anything to the
contrary contained in any document (including any side letters or similar
agreements), if, following Purchaser's investment in the Company, it is
discovered that the investment is or has become a Prohibited Investment, such
investment may immediately be redeemed by the Company or otherwise be subject to
the remedies required by law, and Purchaser shall have no claim against any
Indemnitee for any form of Damages as a result of such forced redemption or
other action.
4.4 Risk Factors. Purchaser acknowledges having received and read the Risk
Factors attached to the Subscription Application as EXHIBIT C (the "Risk
Factors"). Purchaser understands and accepts all of the risks set forth in the
Risk Factors.
4.5 Restricted Stock. Purchaser understands and acknowledges that the
Common Stock and the Warrant Shares have not been, and when issued will not be,
registered with the Securities and Exchange Commission. Further, the Purchaser
understands and acknowledges that the certificates representing the Common Stock
and the Warrant Shares, if and when issued, shall bear a restrictive legend.
4.6 Escrow Agent.
Purchaser understands that the Company has appointed the law firm
▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, LLP to serve as the escrow agent (the "Escrow Agent") for
the transactions contemplated by this Agreement. The Escrow Agent is
concurrently acting as the Company's legal counsel and all fees and expenses
incurred by the Escrow Agent shall be paid by the Company. Such Purchaser agrees
and acknowledges that the duties of the Escrow Agent are only ministerial in
nature, and the Escrow Agent shall incur no liability except for bad faith. The
Escrow Agent is hereby instructed to receive (i) the purchase price of the
investment to be deposited by Purchaser at the Closing and held in an attorney
trust account designated by the Escrow Agent; and (ii) receive original or
copies of signature pages of this Agreement and the other Financing Documents.
At the Closing, the Escrow Agent shall (x) release the deposited funds along
with original or copies of the signature pages to this Agreement and the other
Financing Documents to the Company; and (y) copies of the signature pages to
this Agreement and the other Financing Documents to Purchaser.
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4.7 Legal Counsel.
Purchaser understands that the law firm of ▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇, LLP and
its attorneys represent the Company and Purchaser has had the opportunity to
retain its own legal counsel in connection with transactions contemplated
herewith.
Section 5. Registration Rights.
5.1 Registration Rights Granted. The Company hereby grants the following
registration rights to the Purchaser:
(a) If the Company at any time proposes to register any of its
securities under the Securities Act of 1933, as amended (the "Act") for sale to
the public, whether for its own account or for the account of other security
holders or both, except with respect to registration statements on Forms ▇-▇,
▇-▇ or another form not available for registering the Registrable Securities for
sale to the public, provided the Registrable Securities are not otherwise
subject to an effective registration statement, the Company will give the
Purchaser written notice ("Notice of Registration") to cause such Registrable
Securities to be included with the securities to be covered by the registration
statement proposed to be filed by the Company. In the event that any
registration pursuant to this Section 5.1(a) shall be, in whole or in part, an
underwritten public offering of Common Stock of the Company, the number of
shares of Registrable Securities to be included in such an underwriting may be
reduced by the managing underwriter if and to the extent that the Company and
the underwriter shall reasonably be of the opinion that such inclusion would
adversely affect the marketing of the securities to be sold by the Company
therein; provided, however, that the Company shall notify the Purchaser in
writing of any such reduction. "Registrable Securities" means the number of
shares of the Company's Common Stock converted pursuant to Section 2 of the Note
and issuable upon exercise of the Warrant.
(b) The Company shall file, or use its best efforts to file, a Form
SB-2 Registration Statement (or such other form that it is eligible to use) (a
"Registration Statement") in order to register the issuance of the Registrable
Securities to the Purchaser under the Securities Act with the SEC within sixty
days after the last closing (the "Filing Date"), and cause, or use its best
efforts to cause, such registration statement to be declared effective within
one hundred twenty days after the last Closing (the "Effective Date"). The
Company will include the number of shares of Common Stock in the aforedescribed
registration statement that is equal to the Registrable Securities (calculated
as of the date of filing).
(c) The Company agrees not to enter into any acquisition agreements
which, upon consummation, would require the filing of a Form 8-K with audited
financial statements (a "Material Acquisition") until the Registration Statement
is declared effective, or 180 days after the last closing, whichever is first.
The Company also agrees that, after the Registration Statement is declared
effective, it will not enter into an agreement for any Material Acquisition for
a period of at least 60 days unless the Registration Statement is on Form S-3.
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5.2 Registration Procedures. If and whenever the Company is required by
the provisions hereof to effect the registration of the Registrable Securities
under the Act, the Company will:
(a) prepare and file with the SEC a registration statement with
respect to such securities and use its best efforts to cause such registration
statement to become and remain effective for the period of the distribution
contemplated thereby (determined as herein provided), and promptly provide to
the Purchaser copies of all filings and SEC letters of comment;
(b) prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection therewith as
may be necessary to keep such registration statement effective until the earlier
date of when: (i) all Registrable Securities have been sold or (ii) all
Registrable Securities may be sold immediately without registration under the
Securities Act and without volume restrictions pursuant to Rule 144(k), as
determined by the counsel to the Company pursuant to a written opinion letter to
such effect, addressed and acceptable to the Company's transfer agent and the
affected Holders (the "Effectiveness Period");
(c) furnish to the Purchaser such number of copies of the
registration statement and the prospectus included therein (including each
preliminary prospectus) as the Purchaser reasonably may request to facilitate
the public sale or disposition of the securities covered by such registration
statement;
(d) register or qualify the Purchaser's Registrable Securities
covered by such registration statement under the securities or "blue sky" laws
of such jurisdictions as the Purchaser requests, provided, however, that the
Company shall not for any such purpose be required to qualify generally to
transact business as a foreign corporation in any jurisdiction where it is not
so qualified or to consent to general service of process in any such
jurisdiction;
(e) list the Registrable Securities covered by such registration
statement with any securities exchange on which the Common Stock of the Company
is then listed;
5.3 Provision of Documents. In connection with the registration hereunder,
the Purchaser will furnish to the Company in writing such information and
representation letters with respect to itself and the proposed distribution by
it as reasonably shall be necessary in order to assure compliance with federal
and applicable state securities laws.
5.4 Expenses. All expenses incurred by the Company in complying with
Section 5, including, without limitation, all registration and filing fees,
printing expenses, fees and disbursements of counsel and independent public
accountants for the Company, fees and expenses (including reasonable counsel
fees) incurred in connection with complying with state securities or "blue sky"
laws, fees of the NASD, transfer taxes, fees of transfer agents and registrars,
fees of, and disbursements incurred by, and costs of insurance are called
"Registration Expenses". All underwriting discounts and selling commissions
applicable to the sale of Registrable Securities, including any fees and
disbursements of any special counsel to the Purchaser beyond those included in
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Registration Expenses, are called "Selling Expenses." The Company shall be
responsible for all Registration Expenses. All Selling Expenses in connection
with each registration statement shall be borne by Purchaser.
5.5 Indemnification.
(a) In the event of a registration of any Registrable Securities
under the Act pursuant to Section 5, the Company will indemnify and hold
harmless the Purchaser, and its officers, directors and each other person, if
any, who controls the Purchaser within the meaning of the Securities Act,
against any losses, claims, damages or liabilities, joint or several, to which
the Purchaser, or such persons may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any registration statement
under which such Registrable Securities were registered under the Securities Act
pursuant to Section 5, any preliminary prospectus or final prospectus contained
therein, or any amendment or supplement thereof, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and will reimburse the Purchaser, and each such person for any reasonable legal
or other expenses incurred by them in connection with investigating or defending
any such loss, claim, damage, liability or action; provided, however, that the
Company will not be liable in any such case if and to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission so made in
conformity with information furnished by the Purchaser or any such person in
writing specifically for use in any such document.
(b) In the event of a registration of the Registrable Securities
under the Securities Act pursuant to Section 5, the Purchaser will indemnify and
hold harmless the Company, and its officers, directors and each other person, if
any, who controls the Company within the meaning of the Securities Act, against
all losses, claims, damages or liabilities, joint or several, to which the
Company or such persons may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the registration statement
under which such Registrable Securities were registered under the Securities Act
pursuant to Section 5, any preliminary prospectus or final prospectus contained
therein, or any amendment or supplement thereof, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and will reimburse the Company and each such person for any reasonable legal or
other expenses incurred by them in connection with investigating or defending
any such loss, claim, damage, liability or action, provided, however, that the
Purchaser will be liable in any such case if and only to the extent that any
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission so made in
conformity with information furnished in writing to the Company by the Purchaser
specifically for use in any such document.
(c) Promptly after receipt by an indemnified party hereunder of
notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party hereunder,
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notify the indemnifying party in writing thereof, but the omission so to notify
the indemnifying party shall not relieve it from any liability which it may have
to such indemnified party other than under this Section 5.5(c) and shall only
relieve it from any liability which it may have to such indemnified party under
this Section 5.5(c) if and to the extent the indemnifying party is prejudiced by
such omission. In case any such action shall be brought against any indemnified
party and it shall notify the indemnifying party of the commencement thereof,
the indemnifying party shall be entitled to participate in and, to the extent it
shall wish, to assume and undertake the defense thereof with counsel
satisfactory to such indemnified party, and, after notice from the indemnifying
party to such indemnified party of its election so to assume and undertake the
defense thereof, the indemnifying party shall not be liable to such indemnified
party under this Section 5.5(c) for any legal expenses subsequently incurred by
such indemnified party in connection with the defense thereof; if the
indemnified party retains its own counsel, then the indemnified party shall pay
all fees, costs and expenses of such counsel, provided, however, that, if the
defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be reasonable defenses available to it which are different from
or additional to those available to the indemnifying party or if the interests
of the indemnified party reasonably may be deemed to conflict with the interests
of the indemnifying party, the indemnified parties shall have the right to
select one separate counsel and to assume such legal defenses and otherwise to
participate in the defense of such action, with the reasonable expenses and fees
of such separate counsel and other expenses related to such participation to be
reimbursed by the indemnifying party as incurred.
(d) In order to provide for just and equitable contribution in the
event of joint liability under the Securities Act in any case in which either
(i) the Purchaser, or any controlling person of the Purchaser, makes a claim for
indemnification pursuant to this Section 5.5 but it is judicially determined (by
the entry of a final judgment or decree by a court of competent jurisdiction and
the expiration of time to appeal or the denial of the last right of appeal) that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 5.5 provides for indemnification in such case, contribution
under the Securities Act may be required on the part of the Purchaser or
controlling person of the Purchaser in circumstances for which indemnification
is provided under this Section 5.5; then, and in each such case, the Company and
the Purchaser will contribute to the aggregate losses, claims, damages or
liabilities to which they may be subject (after contribution from others) in
such proportion so that the Purchaser is responsible only for the portion
represented by the percentage that the public offering price of its securities
offered by the registration statement bears to the public offering price of all
securities offered by such registration statement, provided, however, that, in
any such case, (A) the Purchaser will not be required to contribute any amount
in excess of the public offering price of all such securities offered by it
pursuant to such registration statement; and (B) no person or entity guilty of
fraudulent misrepresentation (within the meaning of Section 10(f) of the Act)
will be entitled to contribution from any person or entity who was not guilty of
such fraudulent misrepresentation.
Section 6. Brokers and Finders.
The Company shall not be obligated to pay any commission, brokerage fee or
finder's fee based on any alleged agreement or understanding between the
Purchaser and a third person in respect of the transactions contemplated hereby.
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The Purchaser hereby agrees to indemnify the Company against any claim by any
third person for any commission, brokerage or finder's fee or other payment with
respect to this Agreement or the transactions contemplated hereby based on any
alleged agreement or understanding between the Purchaser and such third person,
whether express or implied from the actions of the Purchaser.
Section 7. Successors and Assigns.
This Agreement shall bind and inure to the benefit of the Company, the
Purchaser and their respective successors and assigns.
Section 8. Entire Agreement.
This Agreement and the other writings and agreements referred to in this
Agreement or delivered pursuant to this Agreement contain the entire
understanding of the parties with respect to the subject matter hereof and
supersede all prior agreements and understandings among the parties with respect
thereto.
Section 9. Notices.
All notices, demands and requests of any kind to be delivered to any party
in connection with this Agreement shall be in writing and shall be deemed to
have been duly given if personally delivered or if sent by an
internationally-recognized overnight courier or by registered or certified mail,
return receipt requested and postage prepaid, addressed as follows:
(a) if to the Company, to:
United Heritage Corporation
▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, LLP
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Esq.
(b) if to any Purchaser, to:
the address of such Purchaser set forth on the signature page
hereto;
or to such other address as the party to whom notice is to be given may have
furnished to the other parties to this Agreement in writing in accordance with
the provisions of this Section 9. Any such notice or communication shall be
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deemed to have been received (i) in the case of personal delivery, on the date
of such delivery, (ii) in the case of an internationally-recognized overnight
courier, on the next business day after the date when sent and (iii) in the case
of mailing, on the third business day following that on which the piece of mail
containing such communication is posted.
Section 10. Amendments.
This Agreement may not be modified or amended, or any of the provisions of
this Agreement waived, except by written agreement of the Company and the
Purchaser.
Section 11. Governing Law; Waiver of Jury Trial.
(c) All questions concerning the construction, interpretation and
validity of this Agreement shall be governed by and construed and enforced in
accordance with the domestic laws of the State of Texas without giving effect to
any choice or conflict of law provision or rule (whether in the State of Texas
or any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Texas. In furtherance of the foregoing, the
internal law of the State of Texas will control the interpretation and
construction of this Agreement, even if under such jurisdiction's choice of law
or conflict of law analysis, the substantive law of some other jurisdiction
would ordinarily or necessarily apply.
(d) BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX FINANCIAL
TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND
EXPERT PERSON AND THE PARTIES WISH APPLICABLE LAWS TO APPLY (RATHER THAN
ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR DISPUTES BE RESOLVED BY A
JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION
OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, THE PARTIES HERETO
WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING BROUGHT TO
ENFORCE OR DEFEND ANY RIGHTS OR REMEDIES UNDER THIS AGREEMENT OR ANY DOCUMENTS
RELATED HERETO.
Section 12. Submission to Jurisdiction.
Any legal action or proceeding with respect to this Agreement or the other
Financing Documents may be brought in the courts of the State of Texas and the
United States of America located in Cleburne, Texas and, by execution and
delivery of this Agreement, the Company hereby accepts for itself and in respect
of its property, generally and unconditionally, the jurisdiction of the
aforesaid courts. The Purchaser hereby irrevocably waives, in connection with
any such action or proceeding, any objection, including, without limitation, any
objection to the venue or based on the grounds of forum non conveniens, which it
may now or hereafter have to the bringing of any such action or proceeding in
such respective jurisdictions. The Purchaser hereby irrevocably consents to the
service of process of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, to it at its address as set forth herein.
Section 13. Severability.
------------
It is the desire and intent of the parties that the provisions of this
Agreement be enforced to the fullest extent permissible under the law and public
policies applied in each jurisdiction in which enforcement is sought.
Accordingly, in the event that any provision of this Agreement would be held in
any jurisdiction to be invalid, prohibited or unenforceable for any reason, such
provision, as to such jurisdiction, shall be ineffective, without invalidating
the remaining provisions of this Agreement or affecting the validity or
enforceability of such provision in any jurisdiction. Notwithstanding the
foregoing, if such provision could be more narrowly drawn so as not be invalid,
prohibited or unenforceable in such jurisdiction, it shall, as to such
jurisdiction, be so narrowly drawn, without invalidating the remaining
provisions of this Agreement or affecting the validity or enforceability of such
provision in any other jurisdiction.
11
Section 14. Independence of Agreements, Covenants, Representations and
Warranties.
All agreements and covenants hereunder shall be given independent effect
so that if a certain action or condition constitutes a default under a certain
agreement or covenant, the fact that such action or condition is permitted by
another agreement or covenant shall not affect the occurrence of such default,
unless expressly permitted under an exception to such covenant. In addition, all
representations and warranties hereunder shall be given independent effect so
that if a particular representation or warranty proves to be incorrect or is
breached, the fact that another representation or warranty concerning the same
or similar subject matter is correct or is not breached will not affect the
incorrectness of or a breach of a representation and warranty hereunder. The
exhibits and any schedules attached hereto are hereby made part of this
Agreement in all respects.
Section 15. Counterparts.
This Agreement may be executed in any number of counterparts, and each
such counterpart of this Agreement shall be deemed to be an original instrument,
but all such counterparts together shall constitute but one agreement. Facsimile
counterpart signatures to this Agreement shall be acceptable and binding.
Section 16. Headings.
The section and paragraph headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
Section 17. Preparation of Agreement.
The Company prepared this Agreement and the Financing Documents solely on
its behalf. Each party to this Agreement acknowledges that: (i) the party had
the advice of, or sufficient opportunity to obtain the advice of, legal counsel
separate and independent of legal counsel for any other party hereto; (ii) the
terms of the transactions contemplated by this Agreement are fair and reasonable
to such party; and (iii) such party has voluntarily entered into the
transactions contemplated by this Agreement without duress or coercion. Each
party further acknowledges that such party was not represented by the legal
counsel of any other party hereto in connection with the transactions
contemplated by this Agreement, nor was he or it under any belief or
12
understanding that such legal counsel was representing his or its interests.
Each party agrees that no conflict, omission or ambiguity in this Agreement, or
the interpretation thereof, shall be presumed, implied or otherwise construed
against any other party to this Agreement on the basis that such party was
responsible for drafting this Agreement.
* * * * *
13
IN WITNESS WHEREOF, each of the undersigned has duly executed this Note
Purchase Agreement as of the date first written above.
COMPANY:
UNITED HERITAGE CORPORATION
By:
---------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇
Title: President
PURCHASER:
------------------------------ --------------------------------
Name of Purchaser (Individual or Name of Individual representing
Institution) Purchaser (if an Institution)
------------------------------ --------------------------------
Title of Individual representing Signature of Individual Purchaser or
Purchaser (if an Institution) Individual representing Purchaser
Address:
--------------------------------
Telephone:
--------------------------------
Telecopier:
--------------------------------
Note Principal Amount
---------------------
$
EXHIBIT A
Executed Subscription Application
See Attached.
EXHIBIT B
Form of Convertible Promissory Note
See Attached.
EXHIBIT C
Form of Warrant
See attached.
================================================================================
NOTE PURCHASE AGREEMENT
BETWEEN
UNITED HERITAGE CORPORATION
AND THE
PURCHASER SIGNATORY HERETO
DATED AS OF __________________, 2004
================================================================================