THIS NOTE AND THE COMMON SHARES ISSUABLE UPON CONVERSION OF THIS NOTE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
STATE SECURITIES LAWS. THIS NOTE AND THE COMMON SHARES ISSUABLE UPON
CONVERSION OF THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO
THIS NOTE UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR AN
OPINION OF COUNSEL REASONABLY SATISFACTORY TO ON THE GO HEALTHCARE, INC.
THAT SUCH REGISTRATION IS NOT REQUIRED.
AMENDED AND RESTATED SECURED CONVERTIBLE MINIMUM BORROWING NOTE
FOR VALUE RECEIVED, ON THE GO HEALTHCARE, INC., a Delaware corporation (the
"Borrower") promises to pay to LAURUS MASTER FUND, LTD., c/o M&C Corporate
Services Limited, P.O. Box 309 GT, ▇▇▇▇▇▇ House, South Church Street, ▇▇▇▇▇▇
Town, Grand Cayman, Cayman Islands, Fax: ▇▇▇-▇▇▇-▇▇▇▇ (the "Holder") or its
registered assigns or successors in interest, on order, the sum of Two
Million five Hundred Thousand Dollars ($2,500,000), or, if different, the
aggregate principal amount of all Loans (as defined in the Security Agreement
referred to below), together with any accrued and unpaid interest hereon,
on July 14, 2008 (the "Maturity Date") if not sooner paid. This Note amends
and restates in its entirety (and is given in substitution for and not in
satisfaction of) that certain $2,500,000 Secured Convertible Minimum
Borrowing Note made by the Company in favor of Holder on July 14, 2005
and amended and restated on January 13, 2006.
Capitalized terms used herein without definition shall have the meanings
ascribed to such terms in the Security and Purchase Agreement between the
Borrower and the Holder dated as of the date hereof (as amended, modified
and/or supplemented from time to time, the "Security Agreement").
The following terms shall apply to this Amended and Restated Minimum
Borrowing Note (this "Note"):
Article I
CONTRACT RATE
1.1 Contract Rate. Subject to Sections 4.2 and 5.11, interest payable on the
outstanding principal amount of this Note (the "Principal Amount") shall
accrue at a rate per annum equal to the "prime rate" published in The Wall
Street Journal from time to time (the "Prime Rate"), plus two percent (2%)
(the "Contract Rate"). The Contract Rate shall be increased or decreased
as the case may be for each increase or decrease in the Prime Rate in an
amount equal to such increase or decrease in the Prime Rate; each change
to be effective as of the day of the change in the Prime Rate. Subject to
The Contract Rate shall not at any time be less than eight
percent (8%). Interest shall be (i) calculated on the basis of a 360 day
year, and (ii) payable monthly, in arrears, commencing on August 1, 2005
on the first business day of each consecutive calendar month thereafter
through and including the Maturity Date and on the Maturity Date, whether
by acceleration or otherwise.
1.2 Contract Rate Payments. The Contract Rate shall be
calculated on the last business day of each calendar month hereafter (other
than for increases or decreases in the Prime Rate which shall be calculated
and become effective in accordance with the terms of Section 1.1) until
the Maturity Date (each a "Determination Date")
1
1.3 Currency. All principal, interest and other amounts owing under this
Note, the Security Agreement or any Ancillary Agreement that, in accordance
with their terms, are to be paid in cash shall be paid in US dollars.
All amounts denominated in other currencies shall be converted to the
US dollar equivalent amount in accordance with the Exchange Rate on the
date of calculation. "Exchange Rate" means, in relation to any amount of
currency to be converted into US dollars pursuant to this Note, the
Security Agreement or any Ancillary Agreement, the US dollar exchange
rate as published in the Wall Street Journal on the relevant date of
calculation.
1.4 Taxes.
(a) If permissible by law, any and all payments by the Borrower
hereunder, including any amounts received on a conversion or
redemption of the Note and any amounts on account of interest
or deemed interest, shall be made free and clear of and without
deduction for any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities
with respect thereto, excluding taxes imposed on net income or
franchise taxes of the Holder by the jurisdiction in which such
person is organized or has its principal office (all such
non-excluded taxes, levies, imposts, deductions, charges
withholdings and liabilities, collectively or individually,
"Taxes"). If the Borrower shall be required to deduct any
Taxes from or in respect of any sum payable hereunder to the
Holder, (i) the sum payable shall be increased by the amount
(an "additional amount") necessary so that after making all
required deductions (including deductions applicable to additional
sums payable under this Section 1.4) the Holder shall receive an
amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions
and (iii) the Borrower shall pay the full amount deducted to the
relevant governmental authority in accordance with applicable law.
(b) In addition, the Borrower agrees to pay to the relevant
governmental authority in accordance with applicable law any
present or future stamp or documentary taxes or any other excise
or property taxes, charges or similar levies that arise from any
payment made hereunder or from the execution, delivery or
registration of, or otherwise with respect to, this Note ("Other
Taxes"). The Borrower shall deliver to the Holder official
receipts, if any, in respect of any Taxes or Other Taxes payable
hereunder promptly after payment of such Taxes or Other Taxes or
other evidence of payment reasonably acceptable to the Holder.
2
(c) The Borrower hereby indemnifies and agrees to hold the Holder
harmless from and against Taxes and Other Taxes (including, without
limitation, Taxes and Other Taxes imposed on any amounts payable
under this Section 1.4) paid by such person, whether or not such
Taxes or Other Taxes were correctly or legally asserted. Such
indemnification shall be paid within ten (10) days from the date on
which any such person makes written demand therefor specifying in
reasonable detail the nature and amount of such Taxes or Other
Taxes.
(d) The obligations of the Borrower under this Section 1.4 shall
survive the termination of this Note and the payment of this Note
and all other amounts payable hereunder.
Article II
LOANS; PAYMENTS UNDER THIS NOTE
2.1 Loans. All Loans evidenced by this Note shall be made in accordance with
the terms and provisions of the Security Agreement.
2.2 No Effective Registration. Notwithstanding anything to the contrary
herein, the Holder shall not be required to accept shares of Common Stock
as payment following a conversion by the Holder if there fails to exist
an effective current Registration Statement (as defined in the
Registration Rights Agreement) covering the shares of Common Stock to
be issued, or if an Event of Default hereunder exists and is continuing,
unless such requirement is otherwise waived in writing by the Holder in
whole or in part at the Holder's option.
2.3 Optional Redemption in Cash. The Borrower will have the option of
prepaying this Note ("Optional Redemption") by paying to the Holder a sum
of money equal to one hundred thirty percent (130%) of the principal amount
of this Note together with accrued but unpaid interest thereon and any
and all other sums due, accrued or payable to the Holder arising under
this Note, the Security Agreement, or any other Ancillary Agreement (the
"Redemption Amount") outstanding on the Redemption Payment Date (as
defined below). The Borrower shall deliver to the Holder a written notice
of redemption (the "Notice of Redemption") specifying the date for such
Optional Redemption (the "Redemption Payment Date"), which date shall be
seven (7) days after the date of the Notice of Redemption (the "Redemption
Period"). A Notice of Redemption shall not be effective with respect to
any portion of this Note for which the Holder has previously delivered a
Notice of Conversion (defined below) pursuant to Section 3.1, or for
conversions elected to be made by the Holder pursuant to Section 3.1
during the Redemption Period. The Redemption Amount shall be determined
as if such ▇▇▇▇▇▇'s conversion elections had been completed immediately
prior to the date of the Notice of Redemption. On the Redemption Payment
Date, the Redemption Amount (plus any additional interest and fees
accruing on the Notes during the Redemption Period) must be irrevocably
paid in full in immediately available funds to the Holder. In the event
the Borrowers fail to pay the Redemption Amount on the Redemption Payment
Date, then such Redemption Notice shall be null and void.
3
Article III
CONVERSION RIGHTS AND FIXED CONVERSION PRICE
3.1 Optional Conversion. Subject to the terms of this Article III, the Holder
shall have the right, but not the obligation, at any time until the
Maturity Date, or during an Event of Default (as defined in Article IV),
and, subject to the limitations set forth in Section 3.2 hereof, to convert
all or any portion of the outstanding Principal Amount and/or accrued
interest and fees due and payable into fully paid and nonassessable shares
of the Common Stock at the Fixed Conversion Price. For purposes hereof,
subject to Section 3.6 hereof, the initial "Fixed Conversion Price"
means $.50. The shares of Common Stock to be issued upon such conversion
are herein referred to as the "Conversion Shares."
3.2 Conversion Limitation. Notwithstanding anything contained herein to the
contrary, the Holder shall not be entitled to convert pursuant to the terms
of this Note an amount that would be convertible into that number of
Conversion Shares which would exceed the difference between (i) 4.99% of
the outstanding shares of Common Stock and (ii) the number of shares of
Common Stock beneficially owned by the Holder. For purposes of the
immediately preceding sentence, beneficial ownership shall be determined
in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3
thereunder. The Conversion Shares limitation described in this Section 3.2
shall automatically become null and void without any notice to any
Borrower upon the occurrence and during the continuance of an Event of
Default, or upon 75 days prior notice to the Company. Notwithstanding
anything contained herein to the contrary, the provisions of this
Section 3.2 are irrevocable and may not be waived by the Holder or any
Borrower. The Holder shall be solely responsible for determining its
ownership pursuant to this Section 3.2.
3.3 Mechanics of ▇▇▇▇▇▇'s Conversion. In the event that the Holder elects
to convert this Note into Common Stock, the Holder shall give notice of
such election by delivering an executed and completed notice of conversion
in substantially the form of Exhibit A hereto (appropriately completed)
("Notice of Conversion") to the Borrower and such Notice of Conversion
shall provide a breakdown in reasonable detail of the Principal Amount,
accrued interest and fees that are being converted. On each Conversion
Date (as hereinafter defined) and in accordance with its Notice of
Conversion, the Holder shall make the appropriate reduction to the
Principal Amount, accrued interest and fees as entered in its records
and shall provide written notice thereof to the Borrower within two (2)
Business Days after the Conversion Date. Each date on which a Notice
of Conversion is delivered or telecopied to the Borrower in accordance
with the provisions hereof shall be deemed a Conversion Date (the
"Conversion Date"). Pursuant to the terms of the Notice of Conversion,
the Borrower will issue instructions to the transfer agent accompanied
by an opinion of counsel within one (1) Business Day of the date of the
delivery to the Borrower of the Notice of Conversion and shall cause the
transfer agent to transmit the certificates representing the Conversion
Shares to the Holder by crediting the account of the Holder's designated
broker with the Depository Trust Corporation ("DTC") through its Deposit
Withdrawal Agent Commission ("DWAC") system within three (3) Business
Days after receipt by the Borrower of the Notice of Conversion (the
"Delivery Date"). In the case of the exercise of the conversion rights
set forth herein the conversion privilege shall be deemed to have been
exercised and the Conversion Shares issuable upon such conversion shall
be deemed to have been issued upon the date of receipt by the Borrower
of the Notice of Conversion. The Holder shall be treated for all
purposes as the record holder of the Conversion Shares, unless the
Holder provides the Borrower written instructions to the contrary.
4
3.4 Late Payments. Each Borrower understands that a delay in the delivery
of the Conversion Shares in the form required pursuant to this Article
beyond the Delivery Date could result in economic loss to the Holder.
As compensation to the Holder for such loss, in addition to all other
rights and remedies which the Holder may have under this Note, applicable
law or otherwise, the Borrowers shall, jointly and severally, pay late
payments to the Holder for any late issuance of Conversion Shares in the
form required pursuant to this Article III upon conversion of this Note,
in the amount equal to $500 per Business Day after the Delivery Date.
The Borrowers shall, jointly and severally, make any payments incurred
under this Section in immediately available funds upon demand.
3.5 Conversion Mechanics. The number of shares of Common Stock to be issued
upon each conversion of this Note shall be determined by dividing that
portion of the principal and interest and fees to be converted, if any,
by the then applicable Fixed Conversion Price.
3.6 Adjustment Provisions. The Fixed Conversion Price and number and kind
of shares or other securities to be issued upon conversion determined
pursuant to Section 3.1 shall be subject to adjustment from time to time
upon the occurrence of certain events during the period that this
conversion right remains outstanding, as follows:
(a) Reclassification. If the Borrower at any time shall, by
reclassification or otherwise, change the Common Stock into the
same or a different number of securities of any class or classes,
this Note, as to the unpaid Principal Amount and accrued interest
thereon, shall thereafter be deemed to evidence the right to
purchase an adjusted number of such securities and kind of
securities as would have been issuable as the result of such
change with respect to the Common Stock (i) immediately prior
to or (ii) immediately after such reclassification or other
change at the sole election of the Holder.
(b) Stock Splits, Combinations and Dividends. If the shares of Common
Stock are subdivided or combined into a greater or smaller number
of shares of Common Stock, or if a dividend is paid on the Common
Stock or any preferred stock issued by the Borrower in shares of
Common Stock, the Fixed Conversion Price shall be proportionately
reduced in case of subdivision of shares or stock dividend or
proportionately increased in the case of combination of shares,
in each such case by the ratio which the total number of shares
of Common Stock outstanding immediately after such event bears
to the total number of shares of Common Stock outstanding
immediately prior to such event.
5
3.7 Reservation of Shares. During the period the conversion right exists,
the Borrower will reserve from its authorized and unissued Common Stock
a sufficient number of shares to provide for the issuance of Conversion
Shares upon the full conversion of this Note the Secured Convertible Term
Note and the Warrant. The Borrower represents that upon issuance, the
Conversion Shares will be duly and validly issued, fully paid and
non-assessable. The Borrower agrees that its issuance of this Note
shall constitute full authority to its officers, agents, and transfer
agents who are charged with the duty of executing and
issuing stock certificates to execute and issue the necessary certificates
for the Conversion Shares upon the conversion of this Note.
3.8 Registration Rights. The Holder has been granted registration rights with
respect to the Conversion Shares as set forth in a Registration Rights
Agreement.
6
Article IV
EVENTS OF DEFAULT AND DEFAULT RELATED PROVISIONS
4.1 Events of Default. The occurrence of an Event of Default under the
Security Agreement shall constitute an event of default ("Event of
Default") hereunder.
4.2 Default Interest. Following the occurrence and during the continuance
of an Event of Default, the Borrowers shall, jointly and severally,
pay additional interest on the outstanding principal balance of this
Note in an amount equal to two percent (2%) per month, and all
outstanding Obligations, including unpaid interest, shall continue
to accrue interest at such additional interest rate from the date of
such Event of Default until the date such Event of Default is cured
or waived.
4.3 Default Payment. Following the occurrence and during the continuance
of an Event of Default, the Holder, at its option, may elect, in
addition to all rights and remedies of the Holder under the Security
Agreement and the Ancillary Agreements and all obligations of each
Borrower under the Security Agreement and the Ancillary Agreements,
to require the Borrowers, jointly and severally, to make a Default
Payment ("Default Payment"). The Default Payment shall be 130% of
the outstanding principal amount of the Note, plus accrued but unpaid
interest, all other fees then remaining unpaid, and all other amounts
payable hereunder. The Default Payment shall be applied first to any
fees due and payable to the Holder pursuant to the Notes and/or the
Ancillary Agreements, then to accrued and unpaid interest due on the
Notes, the Security Agreement and then to the outstanding principal
balance of the Notes. The Default Payment shall be due and payable
immediately on the date that the Holder has exercised its rights
pursuant to this Section 4.3.
Article V
MISCELLANEOUS
5.1 Conversion Privileges. The conversion privileges set forth in
Article III shall remain in full force and effect immediately from the
date hereof until the date this Note is indefeasibly paid in full and
irrevocably terminated.
5.2 Cumulative Remedies. The remedies under this Note shall be cumulative.
5.3 Failure or Indulgence Not Waiver. No failure or delay on the part of
the Holder hereof in the exercise of any power, right or privilege
hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other right, power or privilege.
All rights and remedies existing hereunder are cumulative to, and not
exclusive of, any rights or remedies otherwise available.
7
5.4 Notices. Any notice herein required or permitted to be given shall
be in writing and shall be deemed effectively given: (a) upon personal
delivery to the party notified, (b) when sent by confirmed telex or
facsimile if sent during normal business hours of the recipient, if
not, then on the next business day, (c) five days after having been
sent by registered or certified mail, return receipt requested,
postage prepaid, or (d) one day after deposit with a nationally
recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent to
the Borrower at the address provided for such Borrower in the Security
Agreement executed in connection herewith, and to the Holder at the
address provided in the Security Agreement for such Holder, with a copy
to ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, facsimile number (▇▇▇) ▇▇▇-▇▇▇▇, or at such other address
as the respective Borrower or the Holder may designate by ten days
advance written notice to the other parties hereto. A Notice of
Conversion shall be deemed given when made to the Borrower pursuant
to the Purchase Agreement.
5.5 Amendment Provision. The term "Note" and all references thereto, as
used throughout this instrument, shall mean this instrument as
originally executed, or if later amended or supplemented, then as so
amended or supplemented, and any successor instrument as such successor
instrument may be amended or supplemented.
5.6 Assignability. This Note shall be binding upon each Borrower and its
successors and assigns, and shall inure to the benefit of the Holder
and its successors and assigns, and may be assigned by the Holder in
accordance with the requirements of the Security Agreement. No
Borrower may assign any of its obligations under this Note without the
prior written consent of the Holder, any such purported assignment
without such consent being null and void.
5.7 Cost of Collection. In case of any Event of Default under this Note,
the Borrowers shall, jointly and severally, pay the Holder's reasonable
costs of collection, including reasonable attorneys' fees.
5.8 Governing Law, Jurisdiction and Waiver of Jury Trial.
(a) THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAW.
(b) EACH BORROWER HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL
COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK SHALL
HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR
DISPUTES BETWEEN ANY BORROWER, ON THE ONE HAND, AND THE HOLDER,
ON THE OTHER HAND, PERTAINING TO THIS NOTE, THE SECURITY AGREEMENT
OR ANY OF THE OTHER ANCILLARY AGREEMENTS OR TO ANY MATTER ARISING
OUT OF OR RELATED TO THIS NOTE, THE SECURITY AGREEMENT OR ANY OF
THE OTHER ANCILLARY AGREEMENTS; PROVIDED, THAT EACH BORROWER
ACKNOWLEDGES THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE
HEARD BY A COURT LOCATED OUTSIDE OF THE COUNTY OF NEW YORK, STATE
OF NEW YORK; AND FURTHER PROVIDED, THAT NOTHING IN THIS NOTE SHALL
BE DEEMED OR OPERATE TO PRECLUDE THE HOLDER FROM BRINGING SUIT OR
TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO COLLECT THE
8
OBLIGATIONS, TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR
THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN
FAVOR OF THE HOLDER. EACH BORROWER EXPRESSLY SUBMITS AND CONSENTS
IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN
ANY SUCH COURT, AND EACH BORROWER HEREBY WAIVES ANY OBJECTION WHICH
IT MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER
VENUE OR FORUM NON CONVENIENS. EACH BORROWER HEREBY WAIVES
PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED
IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS,
COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL ADDRESSED TO THE BORROWERAT THE ADDRESS SET FORTH IN THE
SECURITY AGREEMENT AND THAT SERVICE SO MADE SHALL BE DEEMED
COMPLETED UPON THE EARLIER OF THE COMPANY'S ACTUAL RECEIPT
THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER
POSTAGE PREPAID.
(c) EACH BORROWER DESIRES THAT ITS 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, EACH BORROWER HERETO WAIVES ALL RIGHTS TO TRIAL BY
JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY
DISPUTE, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN
THE HOLDER, AND/OR ANY BORROWER ARISING OUT OF, CONNECTED WITH,
RELATED OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN
THEM IN CONNECTION WITH THIS NOTE, THE SECURITY AGREEMENT, ANY
OTHER ANCILLARY AGREEMENT OR THE TRANSACTIONS RELATED HERETO OR
THERETO.
5.9 Judgment Currency.
(a) If for the purpose of obtaining or enforcing judgment against the
Borrower in any court in any jurisdiction it becomes necessary to
convert into any other currency (such other currency being
hereinafter in this Section 5.9 referred to as the "Judgment
Currency") an amount due in US dollars under this Note, the
conversion shall be made at the Exchange Rate prevailing on the
business day immediately preceding:
(i) the date actual payment of the amount due, in the case of
any proceeding in the courts of New York or in the courts
of any other jurisdiction that will give effect to such
conversion being made on such date: or
(ii) the date on which the foreign court determines, in the
case of any proceeding in the courts of any other
jurisdiction (the date as of which such conversion is
made pursuant to this Section 5.9(a)(ii) being hereinafter
referred to as the "Judgment Conversion Date")
(b) If in the case of any proceeding in the court of any jurisdiction
referred to in Section 5.9(a)(a)(ii) above, there is a change in
the Exchange Rate prevailing between the Judgment Conversion Date
and the date of actual payment of the amount due, the applicable
party shall pay such adjusted amount as may be necessary to ensure
that the amount paid in the Judgment Currency, when converted at
the Exchange Rate prevailing on the date of payment, will produce
the amount of US dollars which could have been purchased with the
amount of Judgment Currency stipulated in the judgment or judicial
order at the Exchange Rate prevailing on the Judgment Conversion
Date.
9
(c) Any amount due from the Borrower under this provision shall be
due as a separate debt and shall not be affected by judgment
being obtained for any other amounts due under or in respect
of this Note.
5.10 Severability. In the event that any provision of this Note is invalid or
unenforceable under any applicable statute or rule of law, then such
provision shall be deemed inoperative to the extent that it may conflict
therewith and shall be deemed modified to conform with such statute or
rule of law. Any such provision which may prove invalid or unenforceable
under any law shall not affect the validity or enforceability of any other
provision of this Note.
5.11 Maximum Payments. Nothing contained herein shall be deemed to establish
or require the payment of a rate of interest or other charges in excess
of the maximum permitted by applicable law. In the event that the rate
of interest required to be paid or other charges hereunder exceed the
maximum rate permitted by such law, any payments in excess of such
maximum rate shall be credited against amounts owed by the Borrower
to the Holder and thus refunded to the Borrower.
5.12 Security Interest. The Holder has been granted a security interest in
certain assets of the Borrower as more fully described in the Security
Agreement and pursuant to each of the Master Security Agreement, the
Subsidiary Guarantee, and the Stock Pledge Agreement, each dated as of
the date hereof.
5.13 Registered Obligation. This Note is intended to be a registered
obligation within the meaning of Treasury Regulation Section
1.871-14(c)(1)(i) and the Company (or its agent) shall register
this Note (and thereafter shall maintain such registration) as to
both principal and any stated interest. Notwithstanding any document,
instrument or agreement relating to this Note to the contrary, transfer
of this Note (or the right to any payments of principal or stated
interest thereunder) may only be effected by (i) surrender of this
Note and either the reissuance by the Company of this Note to the new
holder or the issuance by the Company of a new instrument to the new
holder, or (ii) transfer through a book entry system maintained by the
Company (or its agent), within the meaning of Treasury Regulation
Section 1871-14(c)(1)(i)(B).
5.14 Construction. Each party acknowledges that its legal counsel
participated in the preparation of this Note and, therefore, stipulates
that the rule of construction that ambiguities are to be resolved against
the drafting party shall not be applied in the interpretation of this
Note to favor any party against the other.
[Balance of page intentionally left blank; signature page follows]
10
IN WITNESS WHEREOF, each Borrower has caused this Amended and Restated Secured
Convertible Minimum Borrowing Note to be signed in its name effective as
of this 14th day of July, 2005.
ON THE GO HEALTHCARE, INC.
By:/s/▇▇▇▇▇▇ ▇▇▇▇
--------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇
Title:CEO
I/We have authority to bind the corporation.
11
EXHIBIT A
NOTICE OF CONVERSION
(To be executed by the Holder in order to convert the Secured Convertible
Minimum Borrowing Note)
The undersigned hereby elects to convert $_________ of the principal and
$_________ of the interest due on the Secured Convertible Minimum Borrowing
Note dated as of _________, 200__ (the "Note") issued by On The Go Healthcare
Inc. (the "Company") into shares of Common Stock of the Company in accordance
with the terms and conditions set forth in the Note, as of the date written
below.
Date of Conversion:
Conversion Price:
Shares To Be Delivered:
Signature:
Print Name:
Address:
Holder DWAC instructions
12