Exhibit 10.1
16
581034.6
12% SENIOR SECURED CONVERTIBLE DEBENTURE
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), NOR UNDER ANY STATE SECURITIES LAW AND SUCH SECURITIES MAY
NOT BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED, OR OTHERWISE TRANSFERRED UNTIL (1)
A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE ACT AND ANY
APPLICABLE STATE SECURITIES LAW OR (2) THE COMPANY RECEIVES AN OPINION OF
COUNSEL TO THE COMPANY OR COUNSEL TO THE HOLDER OF SUCH SECURITIES, WHICH
COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH
SECURITIES MAY BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED, OR TRANSFERRED WITHOUT
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND APPLICABLE STATE
SECURITIES LAWS.
Albuquerque, New Mexico
April 1, 2002
FOR VALUE RECEIVED, Americana Publishing, Inc., a Colorado corporation with
offices at 303 San Mateo NE, Suite 104A, Albuquerque, New Mexico 87108 (the
"Obligor"), promises to pay to the order of and its successors and assigns (the
"Holder") at such place as the Holder may designate by written notice to the
Company, in lawful money of the United States of America, the sum of ($ ) (the
"Principal Amount") plus all accrued and unpaid interest on the outstanding
Principal Amount at the rate of twelve percent (12%) per annum. The Obligor
shall pay accrued interest on the outstanding Principal Amount on a quarterly
basis, commencing 90 days from the date hereof, and on payment of the Principal
Amount. All principal, premiums and interest are to be paid without setoff or
counterclaim as set forth below. The Obligor further agrees as follows:
Section 1. Purchase Agreement.
This debenture (the "Debenture") is being issued in connection with a 12%
Senior Secured Convertible Debenture and Warrant Purchase Agreement, dated April
1, 2002 (the "Purchase Agreement"), between the Obligor and certain Investors
(as defined in the Purchase Agreement) in connection with the sale (the
"Offering") by the Obligor of an aggregate of $ of Debentures and Class A and
Class B warrants (collectively, the "Warrants") to purchase shares of the
Obligor's common stock, $.001 par value per share (the "Common Stock").
Section 2. Payments.
(a) Principal and Interest Payments. Unless this Debenture shall be converted in
accordance with the provisions of Section 7 or redeemed earlier in accordance
with Section 2(b) hereof, the Principal Amount shall be due and payable one year
from the date of this Debenture. All quarterly interest payments shall be made
by the Obligor by wire transfer to an account designated by the Holder, by
certified check or, at the sole discretion of the Holder, in an amount of shares
of Common Stock determined by dividing such quarterly interest payments, plus
any Penalty Interest (as hereinafter defined) by the Conversion Price (as
hereinafter defined).
(b) Prepayment Penalty. At any time after the effective date of the registration
statement covering the shares of Common Stock issuable upon the conversion of
the Debentures and the exercise of the Warrants upon 180 calendar days' notice
to the Holder specifying the date on which payment is to be made, the Obligor
shall have the right to prepay this Debenture, in full, at any time in an amount
equal to the product of 140% times the unpaid Principal Amount plus all accrued
but unpaid interest, penalty interest as provided in Section 2(d) hereof and
Liquidated Damages (as hereinafter defined), if any. If notice of prepayment is
given as provided above, but the Obligor fails to prepay on the date specified,
the Obligor shall be liable for such an amount, plus default interest from the
date specified, at the rate of 18% per annum until this Debenture is paid in
full. Notice of prepayment having been given, this Debenture shall nevertheless
continue to be convertible until paid in full.
(c) Usury. The Obligor and the Holder intend that this Debenture comply with any
applicable usury laws from time to time in effect. In furtherance thereof, the
Obligor and the Holder stipulate and agree that none of the items and provisions
contained in this Debenture shall be construed to create a contract to pay, as
consideration for the use, forbearance or detention of money, interest at a rate
in excess of the highest lawful rate under applicable law.
(d) Penalty Interest. If the Obligor fails to pay any quarterly interest payment
on the date such payment is due, the interest payable on the Principal Amount
and on all accrued and unpaid interest as of that date shall be increased to the
rate of 18% per annum until all accrued interest, including Penalty Interest, is
paid in full. Further, in the event that the Obligor fails to meet the
requirements of Section 2(a) of the Registration Rights Agreement, the Obligor
shall pay to the Holder a penalty equal to two percent (2%) per month of the
Principal Amount plus accrued and unpaid interest due on this Debenture for the
period of time the Obligor is in default with respect to the requirements of
Section 2(a).
Section 3. Representations, Warranties and Covenants of the Obligor.
The Obligor represents, warrants and covenants to the Holder as follows:
(a) Due Organization, etc. The Obligor is duly incorporated, validly existing,
and in good standing under the laws of the jurisdiction of its incorporation or
organization.
(b) Authority. The Obligor has all requisite corporate power and authority to
own, lease, license and use its properties and assets and to conduct the
business in which it is engaged. The Obligor has full power and authority to
execute and deliver this Debenture and to grant the Security Interest (as
defined herein) granted herein and the execution and delivery by the Obligor of
this Debenture, and the performance of its obligations hereunder, has been duly
authorized by all necessary corporate or other action. This Debenture is the
legal, valid and binding obligation of the Obligor enforceable against it in
accordance with the terms hereof.
(c) Qualification. The Obligor is duly licensed or qualified and in good
standing as a foreign corporation in each jurisdiction wherein the nature of the
business transacted by it or the nature of the property owned or leased by it
makes such licensing or qualification necessary, the failure of which would have
a material adverse effect on the business, operations, properties or condition
(financial or otherwise) of the Obligor.
(d) Capitalization. The Company's authorized capital stock is as set forth in
the Purchase Agreement.
(e) No Dividends, Redemptions. The Obligor will not (i) declare or pay any
dividend or make any other distribution on any equity securities of the Obligor,
except dividends or distributions payable in equity securities of the Obligor,
or (ii) purchase, redeem or otherwise acquire or retire for value any equity
securities of the Obligor, if, upon giving effect to such dividend,
distribution, purchase, redemption, or other acquisition, the net worth of the
Obligor would be reduced to less than an amount equal to the remaining
indebtedness outstanding under this Debenture and all other Debentures issued
pursuant to the Offering.
(f) Related Transactions. The Obligor will not, without the prior written
consent of the Majority Holders (as hereinafter defined), engage in any
transaction of any kind or nature with any affiliate of the Obligor unless such
transaction, or in the case of a course of related or similar transactions or
continuing transactions, is or are upon terms which are fair to the Obligor, as
the case may be, and which are reasonably similar to, or more beneficial to the
Obligor than the terms deemed likely to occur in similar transactions with
unrelated persons under the same circumstances.
(g) No Liens. The Obligor shall not, without the prior written consent of the
Holders of at least a majority of the outstanding Principal Amount on all of the
Debentures issued pursuant to the Offering ("Majority Consent") create, incur,
assume or suffer to exist (collectively, "incur") any mortgage, pledge, security
interest, assignment, lien (statutory or other), claim, encumbrance of any kind,
license or sublicense or security interest (collectively, "Lien") in or upon any
of the Collateral (as defined herein), except for (1) liens for taxes,
assessments or similar charges incurred in the ordinary course of business that
are not yet due and payable; (2) statutory Liens of landlords and Liens of
carriers, warehousemen, mechanics, materialmen and other Liens imposed by law
incurred in the ordinary course of business for sums not yet delinquent, (3)
Liens incurred or deposits made in the ordinary course of business in connection
with workers' compensation, unemployment insurance and other types of social
security, (4) easements, rights-of-way, encroachments, leases, royalties,
restrictions and other similar title exceptions or encumbrances provided such do
not, in the aggregate, materially interfere with the ordinary conduct of
business of Obligor or materially reduce or impair the value of the real estate
so encumbered, (5) Liens granted to the Holders of Debentures issued pursuant to
the Offering, (6) Liens securing any conditional sales agreements, security
agreements, equipment leases in the nature of title retention agreements or
security agreements or other similar title retention agreements entered into by
Obligor on, prior to the date hereof or after the date hereof in order to secure
the payment of the purchase price of any equipment purchased, leased or
otherwise acquired by Obligor for use in the ordinary course of its business
having aggregate cost of less than $25,000, (7) Liens granted to secure
indebtedness incurred by Obligor if the proceeds of which are used to prepay,
in-full, any Debenture issued pursuant to the Offering pursuant to the terms and
conditions of Section 2(b) hereof, which such indebtedness shall be senior in
right of payment and preference to this Debenture ("Take-out Indebtedness"), and
(8) Liens listed on Schedule 3(p) hereof.
(h) Indebtedness. Except for the indebtedness incurred to financial institutions
and other individuals listed and described on Schedule 3(h) annexed hereto, the
Obligor does not have any outstanding indebtedness (outside of the ordinary
course of business).
(i) Maintenance of Collateral. The Obligor will maintain the Collateral (as
hereinafter defined) in good operating condition and repair.
(j) Sale or Disposition. The Obligor will not sell, contract for sale or
otherwise dispose of any of the Collateral or any interest therein except as
provided in paragraph (t) in this Section 3.
(k) Taxes. The Obligor will pay promptly when due all taxes due from it, except
for taxes and assessments which are being contested in good faith.
(l) Further Assurances. The Obligor will promptly execute and deliver to
____________ as agent for Holders (the "Agent"), such financing statements,
certificates, notices and other documents or instruments as may be necessary to
enable the Agent to perfect or from time to time perfect, renew or continue the
Security Interest granted herein for the benefit of the Holders of the
Debentures, including, without limitation, such financing statements,
certificates and other documents as may be necessary to perfect a security
interest in any additional Collateral hereafter acquired by the Obligor or in
any replacements or proceeds thereof. The Obligor hereby authorizes the Agent to
take all action (including, without limitation, the filing of any Uniform
Commercial Code Financing Statements or amendments thereto without the signature
of the Obligor or the notification of any account debtor or payor) that the
Agent may deem necessary or desirable to perfect or otherwise protect the
Security Interest described hereunder and to obtain the benefits of this
Debenture.
(m) No Conflict. Except as provided on Schedule 3(m) which is annexed hereto,
the Obligor is not in default under any indenture, mortgage, deed of trust,
agreement or other instrument to which it is a party or by which it or any of
its assets may be bound; and (ii) the execution and delivery of this Debenture
and compliance with the provisions hereof shall not violate any provision of law
applicable to the Obligor; nor shall the same conflict with or result in a
breach of any of the terms, conditions or provisions of, or constitute a default
under, the certificate of incorporation or by-laws of the Obligor, or result in
the breach of, constitute any default under, or conflict with the terms of any
indenture, mortgage, agreement or other instrument to which the Obligor is party
or by which it or any of its assets may be bound or result in the creation or
imposition of any Lien upon any of the Collateral, other than for the Security
Interest granted pursuant to the Debentures issued in connection with the
Offering.
(n) Consents. No consent, approval, order, authorization of, or registration,
qualification or filing with, any governmental authority or any other party is
required on the part of the Obligor in connection with the execution and
delivery of this Debenture, the granting of the Security Interest granted
herein, and the performance and consummation of the transactions contemplated
hereby, other than (i) such consents that have been obtained and (ii) the filing
of any financing statement or similar instrument that is required to perfect
Holder's Security Interest.
(o) Litigation. There are no suits, proceedings or investigations pending or, to
the Obligor's knowledge, threatened, against the Obligor which questions the
validity of this Debenture or which, individually or in the aggregate, if
determined adversely, would have a material adverse effect on the Collateral or
the business, operation or condition (financial or otherwise) of the Obligor.
(p) Title. Except as otherwise disclosed in Schedule 3(p) which is attached
hereto, the Obligor is the sole owner of, and has good title to, the Collateral,
free and clear of any Lien, except for the Security Interest granted hereby and
there is no financing statement or similar filing now on file in any public
office covering any material part of the Collateral.
(q) Locations. The chief executive office of the Obligor is located at the
address set forth above. All inventory and equipment held on the date hereof by
the Obligor is located at the locations shown on Schedule 3(q) hereto.
(r) Use of Proceeds. The Obligor shall use the proceeds of the loan evidenced by
this Debenture solely for working capital. In no event shall any portion of the
proceeds of the loan evidenced hereby be used for the repayment of any
indebtedness of the Obligor.
(s) Ordinary Course. While all or any portion of this Debenture is outstanding,
the Obligor shall conduct its operations according to the ordinary and usual
course of the business consistent with past practice, to preserve intact its
present business organization and structure, to keep available the services of
its present officers, agents and employees, to preserve and maintain its assets
and the goodwill of the business and to preserve its relationship with
employees, customers and others having business dealings with them and not to
enter into, amend, modify, terminate, renew, extend, or waive any existing
material right under any material agreements of the Obligor.
(t) Subsequent Transactions. While all or any portion of this Debenture is
outstanding, the Obligor shall use 50% of the net proceeds from any of the
following transactions to reduce the outstanding Principal Amount, accrued and
unpaid interest and penalties due on the Debentures held by the Holders on a pro
rata basis:
(i) one or more sales of assets of the Obligor's assets that, in the aggregate,
exceed $25,000; provided, such sales shall not include products sold in the
ordinary course of business;
(ii) funds received by the Obligor from the exercise of outstanding options or
warrant; provided, such funds, in the aggregate, total $100,000; and
(iii) any unsecured debt raised by the Obligor.
Notwithstanding the foregoing, all secured debt raised by the Obligor subsequent
to the date hereof shall be used to repay all the Principal Amount, accrued and
unpaid interest and penalties on the Debenture.
Any reduction in Principal Amount or the accrued and unpaid interest on the
Debentures made pursuant to this Section 3(t) shall be made on or before the
15th day after the date the Obligor receives any funds listed above. (u)
Reports. The Common Stock of the Obligor is registered pursuant to Section 12(g)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the
Company has filed all reports and other documents required to be filed by it
with the Securities and Exchange Commission pursuant to the reporting
requirements of the Exchange Act. The Obligor covenants that it shall file such
reports and other documents required to be filed by it with the Securities and
Exchange Commission on a timely basis, and it will provide the Holders with
copies of such reports and other documents, until such time as the later of the
repayment, in full, of all of the Principal Amount, accrued and unpaid interest
and penalties thereon, or the sale of all of the Conversion Shares (as defined
in the Purchase Agreement).
(v) Reservation of Common Stock. There have been reserved and the Obligor shall
at all times keep reserved, out of the authorized but unissued Common Stock of
the Company free from any preemptive rights, rights of first refusal or other
restrictions (other than pursuant to the Act), a number of shares of Common
Stock sufficient to provide for the rights of Holders to convert the Debentures.
The transfer agent, if any, for the Common Stock, and every subsequent transfer
agent for any Common Stock issuable upon the exercise of any of the rights of
conversion as set out in this Debenture, shall be irrevocably authorized and
directed at all times to reserve such number of authorized Common Stock as shall
be requisite for such purpose. The Obligor shall keep a copy of this Debenture
on file with any transfer agent for the Common Stock and with every subsequent
transfer agent for the Common Stock issuable upon the exercise of the rights of
conversion represented by this Debenture. Any transfer agent for the Common
Stock and any successor transfer agent for the Common Stock is hereby
irrevocably authorized to cause to be issued from time to time the share
certificates required to honor this Debenture upon its conversion in accordance
with the terms hereof. The Obligor shall supply any such transfer agent with
duly executed share certificates for such purpose.
Section 4. Security Interest.
(a) The Obligor hereby grants to the Holder a first priority security interest
in and lien (the "Security Interest") on the Collateral, subject to superior
priority of that certain lien granted by Obligor to All Tex Financial, Inc.
which is the subject of a UCC-1 filing dated March 2, 2001, and further subject
to superior priority of any UCC-1 filings securing leases, to secure performance
and payment of (i) this Debenture, and (ii) all other obligations and
indebtedness of the Obligor to Holder of whatever kind and whenever or however
created or incurred, whether absolute or contingent, matured or unmatured,
direct or indirect (all of the foregoing being the "Secured Indebtedness"). The
Security Interest granted herein shall continue in full force and effect until,
and Holder shall release the Security Interest when all of the Secured
Indebtedness has been discharged or converted into Common Stock in accordance
with the terms hereof.
(b) As used herein, the term "Collateral" shall mean and include all of the
Obligor's right, title and interest in and to all real, tangible and intangible
property of the Obligor whether now or hereafter existing, of every kind and
description, now owned or hereafter acquired and wherever located and the
proceeds (including any insurance proceeds), products and accessions of and to
any thereof, and all books and records pertaining to all of the foregoing, all
of which are and shall at all times be and remain, free and clear of any and all
Liens.
Section 5. Events of Default.
It shall be an event of default ("Event of Default") with respect to this
Debenture upon the occurrence and, where applicable, continuation uncured, of
any of the following events:
(a) Default in Payment, etc.
(i) A default in the payment of the Principal Amount or quarterly interest
payment on this Debenture, when and as the same shall become due and payable,
either by the terms hereof or upon redemption or otherwise, which default shall
continue uncured for a period of five (5) days after receipt by the Obligor of
written notice of such default; or
(ii) A default in the performance, or breach, of any representation, warranty or
covenant of the Obligor in this Debenture or the Purchase Agreement and
continuance of such default or breach shall continue uncured for a period of
five (5) days after receipt by the Obligor of written notice as to such breach.
(b) Bankruptcy, Insolvency, etc. The Obligor becoming insolvent (however defined
or evidenced) or the entry of a decree or order by a court having jurisdiction
adjudging the Obligor bankrupt or insolvent, or approving a petition seeking
reorganization, arrangement, adjustment, or composition of or in respect of the
Obligor, under federal or other applicable bankruptcy law, as now or hereafter
constituted, or any other applicable federal or state bankruptcy, insolvency,
dissolution, liquidation or other similar law, or the commencement by it of a
voluntary or involuntary case under federal or other applicable bankruptcy law,
as now or hereafter constituted, or any other applicable federal or state
bankruptcy, insolvency, dissolution, liquidation or other similar law, or the
consent by it to the institution of bankruptcy, dissolution, liquidation or
insolvency proceedings against it, or the filing by it of a petition or answer
or consent seeking reorganization or relief under federal or other applicable
bankruptcy law or any other applicable federal, state or other law, or the
consent by it to the filing of such petition or to the appointment of a
receiver, liquidator, assignee, trustee, sequestrator, or similar official for,
it or of any substantial part of its property, or the making by it of an
assignment for the benefit of creditors, or the admission by it in writing of
the inability to pay it debts generally as they become due, or the taking of
corporate action by it in furtherance of any such action.
(c) Default on Other Indebtedness. The default in payment of principal of or
interest on any other indebtedness for borrowed money owed by the Obligor or
default in the performance or observance of the terms of any instrument pursuant
to which such indebtedness was created or secured, the effect of which default
is to cause any holder of any such indebtedness to cause the same to become due
prior to its stated maturity (and whether or not such default is waived by the
holder thereof).
Section 6. Remedies Upon Default.
(a) Acceleration and Liquidated Damages. Upon an Event of Default and at any
time during the continuation thereof, the Holder, by notice given to the
Obligor, may declare the entire unpaid Principal Amount, and, if applicable,
redemption premium or Penalty Interest (collectively, the "Acceleration
Amount"), of this Debenture then outstanding to be due and payable immediately
together with liquidated damages payable to the Holder equal to 40% of the
Acceleration Amount ("Liquidated Damages"), and upon any such acceleration the
same shall become and be due and payable immediately, anything herein contained
to the contrary notwithstanding. After acceleration and until the Acceleration
Amount and all accrued and unpaid Liquidated Damages is paid pursuant to this
Section 6(a), interest shall accrue on such amounts up to and including the date
of the Event of Default at the rate of 18% per annum.
(b) Remedies Regarding Security Interest in Collateral. Upon the occurrence of
any Event of Default, the Holder, together with Holders of at least a majority
of the Principal Amount of Debentures issued pursuant to the Offering (the
"Majority Holders") shall have the following additional rights and remedies,
provided such rights and remedies shall be enforced on behalf of the Majority
Holders solely by the Agent, such Agent to be identified by written notice to
the Obligor:
(i) All rights and remedies provided by law, including, without limitation,
those provided by the Uniform Commercial Code as in effect in the states of New
Mexico and Colorado from time to time (the "UCC").
(ii) The right to take possession of the Collateral and, in addition thereto,
the right to enter upon any premises on which the Collateral or any part thereof
may be situated, without notice, and remove the same therefrom. Agent may
require the Obligor to make the Collateral (to the extent the same is moveable)
available to the Agent at a place to be designated by the Agent which is
reasonably convenient to both parties at the Obligor's expense. Unless the
Collateral threatens to decline speedily in value or is of a type customarily
sold on a recognized market, the Agent will give the Obligor at least two (2)
days' prior written notice at the address of the Obligor set forth above (or at
such other address or addresses as the Obligor shall specify in writing to the
Agent) of the time and place of any public sale thereof or of the time after
which any private sale or any other intended disposition thereof is to be made.
Any such notice shall be deemed to meet any requirement hereunder or under any
applicable law (including the UCC) that reasonable notification be given of the
time and place of such sale or other disposition. After deducting all costs and
expenses of collection, storage, custody, sale or other disposition and delivery
(including reasonable legal costs and attorneys' fees, expenses and
disbursements) and all other reasonable charges against the Collateral, the
remaining proceeds of any such sale or disposition shall be applied to the
payment of the Secured Indebtedness in such order of priority as the Agent shall
determine and any surplus shall be returned to the Obligor or to any person or
party lawfully entitled thereto. In the event the proceeds of any sale, lease or
other disposition of the Collateral hereunder is insufficient to pay all of the
Secured Indebtedness in full, the Obligor will be liable for the deficiency,
together with interest thereon at the highest rate of interest provided in this
Debenture, and the costs and expenses of collection of such deficiency,
including (to the extent permitted by law), without limitation, reasonable
attorneys' fees, expenses and disbursements.
(c) Proceedings and Actions. During the continuation of any Event of Default,
the Holder may institute such actions and proceedings in law or equity as it
shall deem expedient for the protection of its rights and may prosecute and
enforce its claims against all assets of the Obligor, and in connection with any
such action or proceeding shall be entitled to receive from the Obligor payment
of the Principal Amount of this Debenture plus any accrued and unpaid interest
and penalties, to the date of payment plus reasonable expenses of collection
including, without limitation, reasonable attorneys' fees and expenses. All
rights and remedies available to the Holder pursuant to the provisions of this
Debenture, applicable law and otherwise are cumulative, not exclusive and are
enforceable alternatively and/or concurrently.
Section 7. Conversion of the Debenture.
At the option of the Holder, all or any portion of the outstanding Principal
Amount, plus all accrued and unpaid interest and penalty interest, including
Liquidated Damages, on the Debenture, shall be convertible into shares of Common
Stock at the Conversion Price (as defined in the Purchase Agreement). In the
event of any reclassification, consolidation, merger or sale of substantially
all of the Obligor assets or similar transaction, the Holder shall be entitled
to purchase the kind and number of shares of stock and other securities and
property receivable upon such transaction as if the Holder were the owner of the
Common Stock issuable hereunder immediately prior to any such event at the
Conversion Price in effect on the date of the closing of such transaction ;
provided, however, that in no event shall the Holder be entitled to convert any
portion of this Debenture in excess of that portion of this Debenture upon
conversion of which the sum of (1) the number of shares of Common Stock
beneficially owned by the Holder and its affiliates (other than shares of Common
Stock which may be deemed beneficially owned through the ownership of the
unconverted portion of this Debenture or the unexercised or unconverted portion
of any other security of the Borrower (including, without limitation, the
warrants issued by the Borrower pursuant to the Purchase Agreement) subject to a
limitation on conversion or exercise analogous to the limitations contained
herein) and (2) the number of shares of Common Stock issuable upon the
conversion of the portion of this Debenture with respect to which the
determination of this proviso is being made, would result in beneficial
ownership by the Holder and its affiliates of more than 4.9% of the outstanding
shares of Common Stock. For purposes of the proviso to the immediately preceding
sentence, beneficial ownership shall be determined in accordance with Section
13(d) of the Securities Exchange Act of 1934, as amended, and Regulations 13D-G
thereunder, except as otherwise provided in clause (1) of such proviso. The
Holder of this Debenture may waive the limitations set forth herein by written
notice to the Company.
Section 8. Miscellaneous.
(a) This Debenture may be altered only by prior written agreement signed by the
party against whom enforcement of any waiver, change, modification, or discharge
is sought. This Debenture may not be modified by an oral agreement, even if
supported by new consideration.
(b) Notwithstanding anything provided herein, Holder may assign this Debenture
in whole or in part to one or more officers or partners of Holder. The
obligations under this Debenture may not be assigned by the Obligor without the
prior Majority Consent. The covenants, terms and conditions contained in this
Debenture apply to and bind the heirs, successors, executors, administrators and
assigns of the parties.
(c) Upon receipt by the Obligor of evidence reasonably satisfactory to the
Obligor of the loss, theft, destruction or mutilation of this Debenture, and of
indemnity or security reasonably satisfactory to the Obligor, and upon
reimbursement to the Obligor of all reasonable expenses incidental thereto, and
upon surrender and cancellation of this Debenture, if mutilated, the Obligor
will make and deliver a new Debenture of like tenor and of the same series, in
lieu of this Debenture.
(d) This Debenture constitutes a final written expression of all of the terms of
the agreement between the parties regarding the subject matter hereof, and
supersedes all prior agreements, understandings, and representations between the
parties. If any provision or any word, term, clause, or other part of any
provision of this Debenture shall be invalid for any reason, the same shall be
ineffective, but the remainder of this Debenture shall not be affected and shall
remain in full force and effect.
(e) This Debenture shall be governed by and construed in accordance with the
laws of the State of New York without giving effect to its conflicts of law
principles. The Obligor agrees that any dispute or controversy arising out of
this Debenture shall be adjudicated in a court located in New York City, and
hereby submits to the exclusive jurisdiction of the courts of the State of New
York located in New York, New York, and of the federal courts in the Southern
District of New York, and irrevocably waives any objection it now or hereafter
may have respecting the venue of such action or proceeding brought in such a
court or respecting the fact that such court is an inconvenient forum, and
consents to the service of process in any such action or proceeding by means of
registered or certified mail, return receipt requested, to the address set forth
below.
(f) All notices, consents, or other communications provided for in this
Debenture or otherwise required by law shall be in writing and may be given to
or made upon the respective parties at the following mailing address:
Holder:
With a copy to:
Obligor:Americana Publishing, Inc.
303 San Mateo NE, Suite 104A
Albuquerque, New Mexico 87108
Attention: George Lovato, Jr.
Such addresses may be changed by notice given as provided in this
subsection. Notices shall be effective upon the date of receipt; provided,
however, that a notice (other than a notice of a changed address) sent by
certified or registered U.S. mail, with postage prepaid, shall be presumed
received no later than three (3) business days following the date of sending.
IN WITNESS WHEREOF, the Obligor has executed this Debenture effective as of
the date first set forth above.
AMERICANA PUBLISHING, INC.
By:_________________________________
Name: Title:
581034.6
DEBENTURE CONVERSION FORM
To: Americana Publishing, Inc.
The undersigned irrevocably elects to convert:
[__] ALL, or
[__] $_____________
of the accrued and unpaid interest and principal owed on the 12% Senior Secured
Convertible Debenture (the "Debenture") which is attached hereto. The
undersigned requests that the certificates representing the shares of common
stock as to which this Debenture is being converted (the "Conversion Shares") be
registered as follows and requests Americana Publishing, Inc. to so cause the
registration thereof:
Name:____________________________________________________________________
Social Security or Employer Identification Number:_____________________________
Address:_________________________________________________________________
Deliver to:_______________________________________________________________
Address:_________________________________________________________________
If only a portion of the principal amount and accrued and unpaid interest
owed on the Debenture is converted, please issue a new Debenture for the balance
of the unpaid principal amount and accrued and unpaid interest owed on the
Debenture to the registered holder thereof and deliver it to the undersigned at
the following address:
Address:_________________________________________________________________
_________________________________________________________________
Date: _______________, 20 __
___________________________________
(Signature must conform to the name of the holder
of the Debenture specified on the face of the Debenture)
Schedule 3(h)
Existing Indebtedness
[To be provided by the Obligor prior to closing.]
Schedule 3(m)
Default on Indebtedness
[To be provided by the Obligor prior to closing.]
Schedule 3(p)
Liens to which the Collateral is Subject
[To be provided by the Obligor prior to closing.]
Schedule 3(q)
Location of Inventory and Equipment
[To be provided by the Obligor prior to closing.]