17.08 Note and Warrant Purchase Agreement
IntroductionThe form of agreement set forth in the following Section is for use in a
bridge financing in which the bridge investors are loaning money to the company
against delivery of bridge notes, and the company is issuing warrants. The
agreement sets forth that the bridge notes will be convertible into equity and
specifies the conditions when conversion will occur. The representations and
warranties are not extensive. Bridge investors who are not current stockholders
of the company may request additional representations and warranties. The form
of bridge note and warrant are attached as exhibits to the agreement, and each
bridge investor will be issued the same form of such instruments.
Form of Note and Warrant Purchase Agreement XYZ, INC.
NOTE AND WARRANT PURCHASE AGREEMENT
This Agreement is made as of [_____] __, 20__ among XYZ, Inc.,
a ________ corporation (the "Company"), and the undersigned investor[s] (the
"Investor[s]"). Any capitalized terms used herein but not defined herein are
defined in the Note or the Warrant attached hereto as Exhibits A and B. [A
Schedule of Investors is attached hereto as Schedule 1.]
1. The Notes and the Warrants.
1.1 The Notes. Investor[s] agree[s], severally, on the terms and
conditions specified in this Agreement, to lend to the Company the sum of up to
[amount] (individually a "Loan" and collectively with other loans made pursuant
to this Agreement and similar Notes (as defined below), the "Loans") at the
Closings (as defined below). [Each] Investor's Loan shall be evidenced by an
unsecured [secured] convertible [subordinated] promissory note (individually a
"Note" and with the other similar notes issued, collectively, the "Notes") dated
as of the date of the Closing in the form of Exhibit A attached hereto. Each
Note shall be in an amount equal to the principal balance of the Loan less the
Purchase Price of the Warrant, as set forth opposite the name of each Investor
on Schedule A.
1.2 Right to Convert Notes. (a) Next Equity Financing. The principal and unpaid accrued interest
of each Note [will be automatically converted] [may be converted, at the option
of the holder thereof [, in whole or in part,]] into New Stock upon the closing
of the Next Equity Financing. [Notwithstanding the foregoing, accrued interest
on this Note may be paid in cash at the option of the Company.] The number of
shares of New Stock to be issued upon such conversion shall be equal to the
quotient obtained by dividing the outstanding principal [and unpaid accrued
interest] on a Note to be converted, or portion thereof, on the date of
conversion, by the Conversion Price. At least five (5) days prior to the closing
of the Next Equity Financing, the Company shall notify the holder of each Note
in writing of the terms under which the equity securities will be sold in the
Next Equity Financing. The issuance of New Stock pursuant to the conversion of
each Note shall be upon and subject to the same terms and conditions applicable
to the equity securities sold in the Next Equity Financing. [If a holder elects
to convert its Note into New Stock in connection with the Next Equity Financing,
such holder shall inform the Company of its election within (5) days after such
notice is effectively given by the Company pursuant to Section 9.6 hereof. [In
the event that a holder fails to inform the Company of its selection within such
five (5) days period, such holder's Note shall thereafter cease to be
convertible into New Stock, provided, however, that such Note shall continue to
accrue interest at the interest rate applicable to such Note until the earlier
of the Maturity Date or the redemption thereof.]](b) Maturity Conversion. If the Next Equity Financing has not
occurred on or before the Maturity Date, the principal and unpaid accrued
interest of each Note may be converted, at the option of the holder thereof [,
in whole or in part,] into shares of [the Company's Common Stock][shares of the
Company's Series __ Preferred Stock]. The number of shares of [Common
Stock][Preferred Stock] to be issued upon such conversion shall be equal to the
quotient obtained by dividing the outstanding principal and unpaid accrued
interest due on a Note to be converted, or portion thereof, on the date of
conversion by [____].
(c) Corporate Transaction or IPO. In the event of a Liquidity Event
or initial public offering of the Company's Common Stock (an "IPO") prior to
full payment of a Note or prior to the time when a Note may be converted (as
provided herein), all outstanding principal and unpaid accrued interest due on
such Note shall, at Lender's election, be (i) due and payable in full
immediately upon the closing of either of such transactions or (ii) converted
into shares of the Company's [Common Stock][Preferred Stock.] at a Conversion
Price [of $____] [determined by ________].
(d) No Fractional Shares. Upon the conversion of a Note, in lieu of
any fractional shares to which the holder of the Note would otherwise be
entitled, the Company shall pay the Note holder cash equal to such fraction
multiplied by the applicable Conversion Price.
(e) Mechanics of Conversion. [Before any Note holder shall be
entitled to convert the same, such holder shall give written notice to the
Company of the election to convert such Notes.] The Company shall not be
required to issue or deliver the shares issuable on conversion until the Note
holder has surrendered the Note to the Company. Such conversion may be made
contingent upon the closing of the Next Equity Financing, Liquidity Event, or
initial public offering.
1.3 The Warrants. The Company agrees to issue, [upon the Closing] [at the
time of the conversion of the principal and interest on the Notes into capital
stock of the Company (if such event occurs)], to [each] Investor a warrant in
the form of Exhibit B attached hereto (individually a "Warrant" and with the
other similar warrants issued, collectively, the "Warrants") for a number of
shares of New Stock determined by multiplying the principal amount of the Note
issued in conjunction with such Warrant by __ percent (__%), and dividing that
product by the price per share of such New Stock purchased by investors in the
Company's Next Equity Financing. The exercise price per share will be the price
per share in the Next Equity Financing. If there is a Liquidity Event [, an
IPO,] or the Notes are not converted in a Next Equity Financing prior to the
Maturity Date, the Warrants shall [terminate] [be exercisable for a number of
shares of Common Stock of the company equal to __ percent (__%) of the
Investor's principal amount of the Loan divided by $___.]2 The exercise price
per share of the Warrant in such event will be [$_____] [equal to the lower of
the fair market value of the Common Stock as determined in good faith by the
Board of Directors at the time of such event or $___ per share.]
1.4 Place and Date of Closing. The closing of the purchase and sale of
each Note shall be held on the date and time as the Company and [Investors
purchasing a majority in interest of the aggregate principal amount of Notes]
[each Investor] shall agree (a "Closing" or "Closing Date"), [provided that the
Company will not issue more than $______ principal amount of such Notes, and]
provided that no Closings under this Agreement will take place after [date]. Any
Investor's investment is a separate investment, not dependent on any other
Investor's investment.
1.5 Delivery. At each Closing, the Company will deliver to each Investor a
Note in the principal amount set forth above. At the Closing, Investor will
deliver to the Company the amount of Investor's Loan by check or wire transfer.
Upon conversion or Maturity of the Notes pursuant to their terms, or upon a
Liquidity Event, [or IPO,] the Company will issue to Investor Investor's
Warrant, along with, if conversion has occurred, a certificate representing the
stock purchased by conversion of the principal and interest on the Note subject
to the Investor executing the agreements required of investors in such
transaction. [The parties shall also execute and deliver the Security Agreement
attached hereto as Exhibit C.]
1.6 Subsequent Closing. In any subsequent closing (each a "Subsequent
Closing"), the Company may sell additional Notes and Warrants subject to the
terms of this Agreement [, provided that such sale shall not take place later
than [_____________, 200_] [and the aggregate amount of consideration does not
exceed $___________].] Any subsequent purchasers of Notes and Warrants shall
become a party to, and shall be entitled to receive Notes and Warrants in
accordance with this Agreement. Each Subsequent Closing shall take place at such
locations and at such times as shall be mutually agreed upon orally or in
writing by the Company [and such purchasers of additional Notes and Warrants]
[and Investors purchasing a majority in interest of the aggregate principal
amount of the Notes to be sold at such Subsequent Closing].]
2. Representation and Warranties of the Company. The Company hereby represents
and warrants to each Investor as follows:
2.1 Organization and Standing. The Company is a corporation duly
incorporated, validly existing and in good standing under the laws of the State
of [_________]. The Company has the requisite corporate power and authority to
conduct its business as it is presently being conducted and to own and operate
its properties and assets. The Company is duly qualified to transact business
and is in good standing in each jurisdiction in which failure to so quality
would have a material adverse effect.
2.2 Corporate Power. The Company will have at each Closing all requisite
corporate power and authority and has taken all corporate action necessary to
execute and deliver this Agreement, to issue the Note, the Warrant, and any
shares of equity securities issuable on conversion of the Note or upon exercise
of the Warrant, and to carry out and perform its obligations under the terms of
this Agreement.
2.3 Authorization. The execution, delivery and performance of this
Agreement, the Note, the Warrant and any shares of equity securities issuable on
conversion of the Note or upon exercise of the Warrant (except for shares
issuable in connection with the Next Equity Financing) by the Company have been
duly authorized by all requisite corporate action. This Agreement has been, and
the Note and the Warrant will be, duly executed and delivered by the Company,
and constitute or at the time of delivery will constitute the legal, valid and
binding obligations of the Company, enforceable against the Company, in
accordance with their respective terms, except as enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, or similar laws relating
to or affecting the enforcement of creditors' rights, or to principles of equity.2.4 Securities Law Exemptions. Subject to the accuracy of the Investors'
representations in Section 3 of this Agreement, the offer, sale and issuance of
the Note, the Warrant, the equity securities issuable on conversion of the Note
and the exercise of the Warrants, constitute transactions exempt from the
registration and prospectus delivery requirements of the Securities Act of 1933,
as amended (the "Act").
2.5 Stock Fully Paid. All equity securities which may be issued upon the
conversion of the Note or the exercise of the Warrant will, upon issuance
pursuant to the terms of each such instrument, be duly authorized, validly
issued, fully paid and nonassessable, shall be issued free from any preemptive
rights or rights of first offer and free from all taxes, liens and charges with
respect to the issue thereof and, based in part upon the representations and
warranties of the investors, shall be issued in compliance with all applicable
federal and state securities laws.
3. Representations and Warranties of the Investor. Investor hereby represents
and warrants to the Company with respect to the purchase of the Notes and the Warrants:
3.1 Experience. Investor further represents that Investor is an
"accredited investor" within the meaning of Rule 501 of Regulation D promulgated
under the Securities Act of 1933, as amended (the "Securities Act"), or Investor
has sufficient experience in investing in private company securities that such
Investor can protect his or her own interests with respect to such investment,
can bear the economic risk of such investment, is capable of evaluating the
risks of such investment, or Investor is advised by a representative who has
such experience. If other than an individual, each Investor represents it has
not been organized solely for the purpose of acquiring the Company's securities.
3.2 Investment. Investor is acquiring the Note and the Warrant for
investment for Investor's own account, not as a nominee or agent, and not with
the view to, or for resale in connection with, any distribution thereof.
Investor understands that the Notes and the Warrants have not been, and will not
be, registered under the Securities Act by reason of a specific exemption from
the registration provisions of the Securities Act, the availability of which
depends upon, among other things, the bona fide nature of the investment intent
and the accuracy of such Investor representations as expressed herein.
3.3 Rule 144. Each Investor acknowledges that the Note and the Warrant and
any securities issued upon conversion or exercise thereof are restricted
securities under the federal securities laws and that under such laws may be
resold without registration under the Securities Act of 1933 (the "Securities
Act") only in certain limited circumstances. Investor is aware of the provisions
of Rule 144 promulgated under the Securities Act which permit limited resale of
shares purchased in a private placement subject to the satisfaction of certain
conditions.
3.4 No Public Market. Investor understands that no public market now
exists for any of the securities issued by the Company and that the Company has
made no assurances that a public market will ever exist for the Company's
securities.3.5 Access to Data. Investor has had an opportunity to discuss the
Company's business, management and financial affairs with its management.
Investor acknowledges that Investor has received all the information Investor
requested from the Company and that Investor considers necessary or appropriate
for deciding whether to loan the Company money pursuant hereto and to acquire
the Note and Warrant. Investor represents that Investor has had an opportunity
to ask questions and receive answers from the Company regarding the terms and
conditions of the offering of the Notes and Warrants and to obtain any
additional information necessary to verify the accuracy of the information given
the Investor. Investor understands that such discussions, as well as any written
information issued by the Company, were intended to describe certain aspects of
the Company's business and prospects but were not a thorough or exhaustive
description.
3.6 Authorization. This Agreement, when executed and delivered by Investor
will constitute valid and legally binding obligations of the Investor,
enforceable in accordance with their terms, except as such enforcement may be
limited by principles of public policy, and subject to laws of general
application relating to bankruptcy, insolvency and the relief of debtors and
rules of law governing specific performance, injunctive relief or other
equitable remedies. Each Investor represents that it has full power and
authority to enter into this Agreement.
3.7 Brokers or Finders. The parties hereto have not and will incur any
liability for brokerage or finder's fees, commissions, or similar charges in
connection with this Agreement.
3.8 Tax Liability. Investor has reviewed with its own tax advisors the
federal, state, local and/or foreign tax consequences of this investment and the
transactions contemplated by this Agreement. Investor understands that Investor
(and not the Company) shall be responsible for Investor's own tax liability that
may arise as a result of this investment or the transactions contemplated by
this Agreement.
3.9 Further Limitations on Disposition. Without in any way limiting the
representations and warranties set forth above, each Investor further agrees not
to make any disposition of all or any portion of the Note or Warrant unless and
until the transferee has agreed in writing for the benefit of the Company to be
bound by this Section 3 and:
(a) There is then in effect a registration statement under the Act
covering such proposed disposition and such disposition is made in accordance
with such registration statement; or
(b) (i) Investor has notified the Company of the proposed
disposition and has furnished the Company with a detailed statement of the
circumstances of the proposed disposition and (ii) if reasonably requested by
the Company, Investor shall have furnished the Company with an opinion of
counsel, reasonably satisfactory to the Company, that such disposition will not
require registration of such shares under the Act. It is agreed that the Company
will not require opinions of counsel for transactions made pursuant to Rule 144
except in extraordinary circumstances.
[Investor will not make any disposition of any Note, Warrant, or other
Company security to any of the Company's competitors as such is [in good faith]
determined by the Company.]
3.10 Legends. It is understood that the Note, Warrant, and any securities
issuable upon conversion or exercise thereof may bear the following legends:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE (OR INSTRUMENT) HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. SUCH
SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, OR HYPOTHECATED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID
ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION
IS NOT REQUIRED. COPIES OF THE AGREEMENT COVERING THE PURCHASE OF THESE
SECURITIES AND RESTRICTION ON THEIR TRANSFER MAY BE OBTAINED AT NO COST BY
WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE (OR INSTRUMENT)
TO THE SECRETARY OF THE COMPANY AT THE PRINCIPAL EXECUTIVE OFFICES OF THE COMPANY.
[3.11 California Corporate Securities Law. THE SALE OF THE SECURITIES
WHICH ARE THE SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE
COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF SUCH
SECURITIES OR THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION FOR SUCH
CALIFORNIA CORPORATIONS CODE. THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE
EXPRESSLY CONDITIONED UPON SUCH QUALIFICATION BEING OBTAINED, UNLESS THE SALE IS
SO EXEMPT.]
3.12 Events of Default. The following events shall be considered Events of
Default with respect to each Note:
(a) The Company shall default in the payment of any part of the
principal or unpaid accrued interest on the Note [for more than [thirty (30)] days];
(b) The Company shall make an assignment for the benefit of
creditors, or shall admit in writing its inability to pay its debts as they
become due, or shall file a voluntary petition for bankruptcy, or shall file any
petition or answer seeking for itself any reorganization, arrangement,
composition, readjustment, dissolution or similar relief under any present or
future statute, law or regulation, or shall file any answer admitting the
material allegations of a petition filed against the Company in any such
proceeding, or shall seek or consent to or acquiesce in the appointment of any
trustee, receiver or liquidator of the Company, or of all or any substantial
part of the properties of the Company, or the Company or its respective
directors or majority stockholders shall take any action to dissolve or
liquidate the Company;
(c) Within thirty (30) days after the commencement of any proceeding
against the Company seeking any bankruptcy reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief under any
present or future statue, law or regulation, such proceeding shall not have been
dismissed, or within thirty (30) days after the appointment without the consent
or acquiescence of the Company of any trustee, receiver or liquidator of the
Company or of all or any substantial part of the properties of the Company, such
appointment shall not have been vacated;
(d) [Within thirty (30) days after the Company becomes involved in
litigation that threatens to materially and adversely affect the Company's
business, operations, assets, results of operations or prospects if the
Company's involvement has not terminated by such date in a manner that does not
and could not reasonably be expected to materially and adversely affect the
Company's business, operations, assets, results of operations or prospects;](e) The Company shall fail to observe or perform any other
obligation to be observed or performed by it under this Agreement, the Notes,
[or the Warrants] [or the Security Agreement] within [30] days after written
notice from the Majority Noteholders to perform or observe the obligation.
3.13 Remedies. Upon the occurrence of an Event of Default under Section
3.12 hereof, at the option and upon the declaration of the holder of a Note, the
entire unpaid principal and accrued and unpaid interest on such Note [all Notes]
shall, without presentment, demand, protest, or notice of any kind, all of which
are hereby expressly waived, be forthwith due and payable, and such holder [the
holders] may, immediately and without expiration of any period of grace period,
enforce payment of all amounts due and owing under such Note [Notes] and
exercise any and all other remedies granted to it at law, in equity or
otherwise.
4. Miscellaneous.
4.1 Governing Law. This Agreement shall be governed in all respects by the
internal laws of the State of ______________. [Any and all disputes arising out
of or related to this Agreement shall be adjudicated exclusively in the state or
federal courts located in [county][state]].
4.2 Survival. The representations, warranties, covenants and agreements
made herein shall survive any investigation made by any Investor and the closing
of the transactions contemplated hereby.
4.3 Successors and Assigns. Except as otherwise expressly provided herein,
the provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto.
4.4 Entire Agreement; Amendment. This Agreement (including the exhibits
attached hereto) and the other documents delivered pursuant hereto at the
Closing constitute the full and entire understanding and agreement between the
parties with regard to the subjects hereof and thereof, and no party shall be
liable or bound to any other party in any manner by any warranties,
representations, or covenants except as specifically set forth herein or
therein. Except as expressly provided herein, neither this Agreement nor any
term hereof may be amended, waived, discharged or terminated other than by a
written instrument signed by the party against whom enforcement of any such
amendment, waiver, discharge or termination is sought; provided, however, that
holders of a majority of the principal amount of the Notes then outstanding may,
with the Company's prior written consent if the Company's rights or obligations
are being modified, waive, modify, or amend on behalf of all Investors, any
provisions hereof or in the Notes or Warrants [provided that any such amendment
or waiver does not operate on any particular Note or Warrant or group of the
same in a manner different from its operation on all other Notes or Warrants
(without taking into account any circumstances unique to any holder)].
4.5 Notices, Etc. All notices and other communications required or
permitted hereunder shall be in writing and shall be mailed by registered or
certified mail, postage prepaid, sent by telefacsimile, or otherwise delivered
by hand or by a nationally recognized overnight courier, addressed (a) if to an
Investor, at such Investor's address or telefacsimile number set forth in
Schedule 1, or at such other address or telefacsimile number as such Investor
shall have furnished to the Company in writing, or (b) if to the Company, one
copy should be sent to its address or telefacsimile number set forth on the
signature page of this Agreement and addressed to the attention of the Corporate
Secretary or at such other address or telefacsimile number as the Company shall
have furnished to the Investors. Each such notice or other communication shall
for all purposes of this Agreement be treated as effective or having been given
(x) in the case of personal delivery or delivery by telecopier, on the date of
such delivery, (y) in the case of a nationally recognized overnight courier, on
the next business day after the date when sent, and (z) in the case of mailing,
on the third business day following deposit in the United States mail, addressed
and mailed as aforesaid. 4.6 Delays or Omissions. Except as expressly provided herein, no delay or
omission to exercise any right, power or remedy accruing to any Investor, upon
any breach or default of the Company under this Agreement, shall impair any such
right, power, or remedy of such Investor nor shall it be construed to be a
waiver of any such breach or default, or an acquiescence therein, or of or in
any similar breach or default thereafter occurring; nor shall any waiver of any
single breach or default be deemed a waiver of any other breach or default
theretofore or thereafter occurring. Except as provided in Section 4.4 hereof,
any waiver, permit, consent or approval of any kind or character on the part of
any Investor of any breach or default under this Agreement, or any waiver on the
party of any holder of any provisions or conditions of this Agreement, must be
in writing and shall be effective only to the extent specifically set forth in
such writing. All remedies, either under this Agreement of by law or otherwise
afforded to any Investor, shall be cumulative and not alternative.
4.7 [Expenses. The Company and each Investor shall bear its own expenses
incurred on its behalf with respect to this Agreement and the transactions
contemplated hereby. [or: Upon the Closing of the purchase and sale of the Notes
to the Investors, the Company will promptly, after such Closing, pay the fees
and costs, up to $______, of the attorneys for the Investors.]
4.8 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall be deemed to constitute one instrument.
4.9 Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision.
4.10 Titles and Subtitles. The titles and subtitles used in this Agreement
are used for convenience only and are not considered in construing or
interpreting this Agreement.
4.11 Market Standoff. Investors agree, in connection with the Company's
initial public offering of the Company's securities, (i) not to sell, make short
sales of, loan, grant any options for the purchase of, or otherwise dispose of
any equity securities of the Company held by the Investor (other than those
shares included in the registration or acquired in a public market transition)
without the prior written consent of the Company or the underwriters managing
such initial underwritten public offering of the Company's securities for one
hundred eighty (180) days from the effective date of such registration, or such
shorter period of time as is required by the underwriters managing such
offering, (ii) further agree to execute any agreement reflecting (i) above as
may be requested by the underwriters at the time of the public offering, and
(iii) further agree that the Company may impose stop transfer instructions with
its transfer agent in order to enforce the foregoing covenants. [The Investors
shall not be required to abide by this provision unless all then-current
officers, then-current members of the Board of Directors, and holders of the
Company's securities holding greater than [1%] of the Company's outstanding
stock are subject to a similar market standoff as the Investors.] [If any
Investor is either partially or completely released from the terms of this
provision, then all other Investors shall be similarly partially or completely
released, as the case may be.] 4.12 Stock Purchase and Other Agreements. Each Investor understands and
agrees that the conversion of the Notes into New Stock, and the exercise of the
Warrants, may require such Investor's execution of certain agreements [in the
form agreed to by investors in the Next Equity Financing] relating to the
purchase and sale of such securities as well as registration, co-sale, rights of
first refusal, rights of first offer and voting rights, if any, relating to such
securities.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
and delivered by their proper and duly authorized officers as of the date and
year first written above.
COMPANY: XYZ, Inc.
By: ___________________, President
Address: ___________________
Telephone No.: ___________________
Telefacsimile No: ___________________
[INVESTORS]
______________________________(signature)
______________________________ (print name)
__________________________________________
(Taxpayer Identification/Social Security Number)
SUBSTITUTE FORM W-9 CERTIFICATION
UNDER PENALTIES OF PERJURY, BY SIGNING ABOVE, I CERTIFY THAT: (1) the number shown on this form is my correct Taxpayer Identification
Number (or I am waiting for a number to be issued to me), and
(2) I am not subject to backup withholding either because I have not been
notified by the Internal Revenue Service (IRS) that I am subject to backup
withholding as a result of failure to report all interest or dividends, or the
IRS has notified me that I am no longer subject to backup withholding.
CERTIFICATION INSTRUCTIONS. You must cross out item (2) above if you have been
notified by IRS that you are subject to backup withholding because of
underreporting interest or dividends on your tax return.
[SCHEDULE 1
Schedule of Investors]
INVESTOR PRINCIPAL BALANCE PURCHASE PRICE INVESTMENTNAME AND ADDRESS OF NOTE______ OF WARRANT TOTAL
AMOUNT
TOTAL $___________ $____________ $___________
EXHIBIT A
Form of [Secured][Convertible] [Demand] Promissory Note EXHIBIT B
Form of Warrant
[EXHIBIT C
Form of Security Agreement]
