Attached files
| file | filename |
|---|---|
| 10-Q - 10-Q - ENER1 INC | v200866_10q.htm |
| EX-31.2 - EX-31.2 - ENER1 INC | v200866_ex31-2.htm |
| EX-32.2 - EX-32.2 - ENER1 INC | v200866_ex32-2.htm |
| EX-32.1 - EX-32.1 - ENER1 INC | v200866_ex32-1.htm |
| EX-31.3 - EX-31.3 - ENER1 INC | v200866_ex31-3.htm |
| EX-31.1 - EX-31.1 - ENER1 INC | v200866_ex31-1.htm |
| EX-4.32 - EX-4.32 - ENER1 INC | v200866_ex4-32.htm |
| EX-4.33 - EX-4.33 - ENER1 INC | v200866_ex4-33.htm |
| EX-32.3 - EX-32.3 - ENER1 INC | v200866_ex32-3.htm |
Exhibit
4.23
THIS 6% SENIOR CONVERTIBLE NOTE (THIS
“NOTE”) AND THE
SECURITIES ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE
SECURITIES LAW, AND MAY NOT BE OFFERED FOR SALE OR SOLD UNLESS A REGISTRATION
STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS SHALL BE EFFECTIVE
WITH RESPECT THERETO, OR AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION WITH SUCH OFFER
OR SALE. THIS NOTE AND THE SECURITIES ISSUABLE UPON CONVERSION
HEREOF (I) MAY BE
PLEDGED OR HYPOTHECATED IN CONNECTION WITH A BONA FIDE MARGIN LOAN OR OTHER
FINANCING SECURED BY SUCH SECURITIES OR (II) MAY BE TRANSFERRED OR ASSIGNED TO
AN AFFILIATE OF THE HOLDER HEREOF WITHOUT THE NECESSITY OF AN OPINION OF COUNSEL
OR THE CONSENT OF THE ISSUER HEREOF.
THE
OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE MAY BE LESS
THAN THE PRINCIPAL AMOUNT SHOWN BELOW BECAUSE (I) THE PRINCIPAL AMOUNT OF THIS
NOTE WILL ACCRETE IN VALUE FROM THE DATE HEREOF, AND (II) THIS NOTE DOES NOT
REQUIRE PHYSICAL SURRENDER HEREOF IN ORDER TO EFFECT A PARTIAL PAYMENT,
REDEMPTION OR CONVERSION HEREOF.
ENER1,
INC.
6%
SENIOR CONVERTIBLE NOTE
|
Issue
Date: September 15, 2010
|
$6,000,000
|
FOR VALUE RECEIVED, ENER1,
INC., a Florida
corporation (the “Company”),
hereby promises to pay to the order of ITOCHU CORPORATION, a Japan corporation,
or its permitted successors or assigns (the “Holder”),
the sum of up to SIX MILLION AND 00/100 DOLLARS ($6,000,000) in same day funds,
on or before August 27, 2015 (the “Maturity
Date”). The Holder may convert the principal of this Note into
shares (“Conversion
Shares”) of the Company’s common stock, par value $0.01 per share (the
“Common
Stock”), on the terms set forth herein.
Except as
required pursuant to Section 5
or upon a conversion of this Note into shares of Common Stock, the Company shall
not have the right or obligation to prepay any principal of this Note prior to
the Maturity Date.
The
Company has issued this Note pursuant to a Note Purchase Agreement, dated as of
August 27, 2010 (the “Purchase
Agreement”), between the Company and the original purchaser of this
Note. If this Note is partially assigned and divided into two or more
notes, such additional notes along with the remainder of this Note are
collectively referred to herein as the “Notes”.
1. DEFINITIONS.
(a) Defined
Terms. The following terms shall apply to this
Note:
“Acceleration
Notice” has the meaning set forth in Section 5
of this Note.
“Change of
Control” means the existence, occurrence or public announcement of, or
entering into an agreement contemplating, any of the following: (a) the sale,
conveyance or disposition of all or substantially all of the assets of the
Company, (b) the effectuation of a transaction or series of related transactions
in which more than 50% of the voting power of the Company is transferred or
otherwise disposed of; (c) the consolidation, merger or other business
combination of the Company with or into any other entity, immediately following
which the shareholders of the Company immediately prior to such transaction fail
to own, directly or indirectly, at least 50% of the surviving entity; and (d)
the Continuing Directors do not at any time constitute at least a majority of
the Board of Directors. In addition, “Change of Control” shall also
include any transaction or series of related transactions after which the
Company fails to own, directly or indirectly, more than 50% of the voting power
or equity of EnerDel, Inc., a Delaware corporation.
“Common
Stock” has the meaning set forth in the preamble
to this Note.
“Company”
has the meaning set forth in the preamble
to this Note.
“Continuing
Director” means, at any date, a member of the Company’s Board of
Directors (i) who was a member of such board on the Issue Date or (ii) who was
nominated or elected by at least a majority of the directors who were Continuing
Directors at the time of such nomination or
election or whose election to the Company’s Board of
Directors was recommended or endorsed by at least a majority of the directors
who were Continuing Directors at the time of such nomination or election or such
lesser number comprising a majority of a nominating committee if authority for
such nominations or elections has been delegated to a nominating committee whose
authority and composition have been approved by at least a majority of the
directors who were Continuing Directors at the time such
committee was formed.
“Conversion”
has the meaning set forth in Section
3(a) of this Note.
“Conversion
Date” has the meaning set forth in Section
3(b) of this Note.
“Conversion
Default” has the meaning set forth in Section
3(e) of this Note.
“Conversion
Notice” has the meaning set forth in Section
3(b) of this Note.
“Conversion
Price” means $3.612, subject to adjustment as provided
herein.
“Conversion
Shares” has the meaning set forth in the preamble
of this Note.
-2-
“Default Interest
Rate” means the lower of 12% and the maximum rate permitted by applicable
law or by the applicable rules or regulations of any governmental agency or of
any stock exchange or other self-regulatory organization having jurisdiction
over the Company or the trading of its securities.
“Delivery
Date” has the meaning set forth in Section
3(d) of this Note.
“Determination
Date” has the meaning set forth in Section
4(c) of this Note.
“Dispute
Procedure” has the meaning set forth in Section
3(b) of this Note.
“Distribution,” “Distribution
Date” and “Distribution
Notice” have the respective meanings set forth in Section
4(c) of this Note.
“Event of
Default” means the occurrence of any of the following
events:
(i) a
Liquidation Event occurs or is publicly announced;
(ii) the
Company fails to make any payment of principal or interest on this Note in full
as and when such payment is due, and such payment remains unpaid for three
Business Days;
(iii) other
than a breach described in clause
(ii) above, the Company breaches or provides notice of its intent to
breach any material covenant, agreement or condition of this Note or the
Purchase Agreement; and such breach continues for a period of 20 Business Days
following written notice thereof from the Holder; or
(iv) any
material representation or warranty made by the Company in this Note or the
Purchase Agreement was materially inaccurate or misleading in any material
respect as of the date such representation or warranty was made.
“Holder”
has the meaning set forth in the preamble
to this Note.
“Interest”
has the meaning set forth in Section
2(a) of this Note.
“Issue
Date” means the “Issue Date” stated on the front page of this
Note.
“Liquidation
Event” means where (i) the Company shall make a general assignment for
the benefit of creditors or consent to the appointment of a receiver,
liquidator, custodian, or similar official of all or substantially all of its
properties, or any such official is placed in control of such properties, or the
Company shall commence any action or proceeding or take advantage of or file
under any federal or state insolvency statute, including, without limitation,
the United States Bankruptcy Code, seeking to have an order for relief entered
with respect to it or seeking adjudication as a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, liquidation, dissolution,
administration, a voluntary arrangement, or other relief with respect to it or
its debts; or (ii) there shall be commenced against the Company any action or
proceeding of the nature referred to in clause (i)
above or seeking issuance of a warrant of attachment, execution, distraint, or
similar process against all or any substantial part of its property, which
results in the entry of an order for relief which remains undismissed,
undischarged or unbonded for a period of 60 days; or (iii) there is initiated
the dissolution or other winding up of the Company, whether voluntary or
involuntary and whether or not involving insolvency or bankruptcy proceedings;
or (iv) there is initiated any assignment for the benefit of creditors or any
marshalling of the material assets or material liabilities of the
Company.
-3-
“Major
Transaction” means the existence, occurrence or public announcement of,
or entering into an agreement contemplating, a merger, consolidation, business
combination, tender offer, exchange of shares, recapitalization, reorganization,
redemption or other similar event, as a result of which shares of Common Stock
shall be changed into, or exchanged or tendered for, the same or a different
number of shares of the same or another class or classes of stock or securities
or other assets of the Company or another entity.
“Maturity
Date” has the meaning set forth in the preamble
to this Note.
“Record
Date” has the meaning set forth in Section
4(c) of this Note.
(b) Terms Defined in the
Purchase Agreement. Any capitalized term used but not defined
herein has the meaning specified in the Purchase Agreement.
(c) Usage. All
definitions contained in this Note are equally applicable to the singular and
plural forms of the terms defined. The words “hereof”, “herein” and
“hereunder” and words of similar import refer to this Note as a whole and not to
any particular provision of this Note.
2. INTEREST;
SCHEDULED PAYMENTS.
(a) Interest. Commencing
on the Issue Date, this Note shall bear interest on the unpaid principal amount
hereof (“Interest”)
at an annual rate equal to six percent, computed on the basis of a 360-day year
and calculated using the actual number of days elapsed since and including the
day immediately following the date on which Interest was most recently paid
(whether in cash or upon conversion).
(b) Scheduled Payments of
Interest. The Company shall pay to the Holder all accrued and
unpaid Interest in cash on each February 26 and August 26 of each year while
this Note is outstanding, commencing with February 26, 2011.
(c) Method of
Payments. The Company shall make all cash payments required
under this Note by wire transfer of immediately available funds.
(d) Default
Interest. All amortization payments, payments of Interest and
any other payments required under this Note that are not paid as and when due in
accordance with this Note shall bear interest until paid at the Default Interest
Rate.
-4-
3. CONVERSION.
(a) Right to
Convert. The Holder shall have the right, subject to the
limitations described in Section
3(f), at any time and from time to time, to convert all or any part of
the outstanding and unpaid principal and interest on this Note into such number
of fully paid and non-assessable Conversion Shares as is determined in
accordance with the terms hereof (a “Conversion”).
(b) Conversion
Notice. In order to convert principal of this Note, the Holder
shall send by facsimile transmission (followed by a telephonic or email
confirmation that such facsimile was sent), at any time prior to 5:00 p.m., New
York City time, on the Business Day on which the Holder wishes to effect such
Conversion (the “Conversion
Date”), a properly completed notice of conversion to the Company, in the
form set forth on Annex I
hereto, stating the amount of principal to be converted and a calculation of the
number of shares of Common Stock issuable upon such Conversion (a “Conversion
Notice”). The Conversion Notice
shall also state the name or names (with address) in which the shares of Common
Stock that are issuable on such Conversion shall be
issued. The Holder shall not be required to physically
surrender this Note to the Company in order to effect a Conversion. The Company
shall maintain a record showing, at any given time, the unpaid principal amount
of this Note and the date of each Conversion or other payment of principal
hereof. In the case of a dispute as to the number of Conversion
Shares issuable upon a Conversion (including, without limitation, as a result of
adjustments to the Conversion Price made in accordance with Section 4
below), the Company shall promptly issue to the Holder the number of Conversion
Shares that are not disputed, the Company and the Holder shall provide each
other with their respective calculations, and the Company shall submit the
disputed calculations to a certified public accounting firm of national
recognition (other than the Company’s independent accountants) within five
Business Days following the later of the date on which the Holder delivers its
calculations to the Company and the receipt of the Holder’s Conversion Notice.
The Company shall use its reasonable best efforts to cause such accountants to
calculate the Conversion Price as provided herein and to notify the Company and
the Holder of the results in writing no later than five Business Days following
the day on which such accountant received the disputed calculations (the “Dispute
Procedure”). Such accountant’s calculation shall be deemed
conclusive absent manifest error. The fees of any such accountant shall be borne
by the party whose calculations are most at variance with those of such
accountant.
(c) Number of Conversion Shares;
Reduction of Principal. The number of Conversion Shares to be
delivered by the Company pursuant to a Conversion shall be equal to the amount
of principal and interest on this Note being converted divided by the Conversion
Price in effect on the Conversion Date. Upon the valid delivery of
the Conversion Shares by the Company, the amounts subject to such Conversion
shall be credited towards the payment of the principal and interest on this
Note.
(d) Delivery of Common Stock
Upon Conversion. The Company shall, no later than the close of
business on the third Business Day following the Conversion Date (the “Delivery
Date”), issue and deliver or cause to be delivered to the Holder the
number of Conversion Shares determined pursuant to Section
3(c) above; provided, however, that any Conversion
Shares that are the subject of a Dispute Procedure shall be delivered no later
than the close of business on the third Business Day following the resolution of
such dispute in accordance with this Note. If any Conversion would create a
fractional Conversion Share, such fractional Conversion Share shall be
disregarded and the number of Conversion Shares issuable upon such Conversion,
in the aggregate, shall be the nearest whole number of Conversion
Shares. Conversion Shares delivered to the Holder shall not contain
any restrictive legend unless such legend is required pursuant to the terms of
the Purchase Agreement.
-5-
(e) Failure to Deliver
Conversion Shares. If the Company fails for any reason to
deliver to the Holder the number of Conversion Shares specified in a Conversion
Notice on or before the Delivery Date therefor (or, with respect to Conversion
Shares subject to a Dispute Procedure, no later than the close of business on
the third Business Day following the resolution of such dispute) (such failure,
a “Conversion
Default”), the Holder shall have the right to receive from the Company an
amount equal to (A) (N/365) multiplied by (B) the
principal amount of this Note represented by the Conversion Shares which remain
the subject of such Conversion Default multiplied by (C) the Default
Interest Rate, where “N” equals the number of days elapsed between the date on
which such Conversion Shares were to be delivered and the date on which such
Conversion Default has been cured. Amounts payable pursuant to the
preceding sentence shall be paid to the Holder in immediately available funds on
or before the fifth Business Day following written notice from the Holder to the
Company specifying the amount owed to it by the Company. In the event
that shares of Common Stock are purchased by or on behalf of the Holder in order
to make delivery on a sale effected in anticipation of receiving Conversion
Shares upon a Conversion, and there is a Conversion Default with respect
thereto, the Holder shall have the right to receive from the Company, in
addition to the foregoing amounts, (1) the aggregate amount paid by or on behalf
of the Holder for such shares of Common Stock minus (2) the aggregate
amount of net proceeds, if any, received by the Holder from the sale of such
Conversion Shares as and when such shares are delivered by the Company to the
Holder.
(f) Limitation on Right to
Convert. In no event shall the Holder be permitted to convert
principal of this Note if, upon such conversion, (x) the number of Conversion
Shares to be issued pursuant to such Conversion plus (y) the number of shares
of Common Stock beneficially owned by the Holder (other than Common Stock which
may be deemed beneficially owned except for being subject to a limitation on
conversion or exercise analogous to the limitation contained in this Section
3(f)) would exceed 9.9% of the number of shares of Common Stock then
issued and outstanding, it being the intent of the Company and the Holder that
the Holder not be deemed at any time to have the power to vote or dispose of
greater than 9.9% of the number of shares of Common Stock issued and outstanding
at any time. Nothing contained herein shall be deemed to restrict the right of
the Holder to convert such excess principal amount at such time as such
Conversion does not violate the provisions of this Section
3(f). As used herein, beneficial ownership shall be determined in
accordance with Section 13(d) of the Exchange Act. The holders of
Common Stock are to be deemed third-party beneficiaries of the limitation
imposed hereby and, accordingly, this Section
3(f) may not be amended without the consent of the holders of a majority
of the shares of Common Stock then outstanding; provided, however, that the Holder
shall have the right, upon 60 days’ prior written notice to the Company, to
waive the provisions of this Section
3(f)
without obtaining such consent.
4. ADJUSTMENTS
TO CONVERSION PRICE.
(a) Stock Splits, Stock
Interests, Etc. If, at any time on or after the Issue Date,
the number of outstanding shares of Common Stock is increased by a stock split,
stock dividend, reclassification or other similar event, the Conversion Price
shall be proportionately reduced, or if the number of outstanding shares of
Common Stock is decreased by a reverse stock split, combination,
reclassification or other similar event, the Conversion Price shall be
proportionately increased.
-6-
(b) Major
Transactions. If, at any time after the Issue Date, any Major
Transaction shall occur, then the Holder shall thereafter have the right to
receive upon Conversion, in lieu of the shares of Common Stock otherwise
issuable, such shares of stock, securities and/or other property as would have
been issued or payable upon such Major Transaction with respect to or in
exchange for the number of shares of Common Stock which would have been issuable
upon Conversion had such Major Transaction not taken place (without giving
effect to any limitations on such Conversion contained in this
Note). After the public disclosure by
the Company of such Major
Transaction, (i) the
Holder shall be given written notice of such transaction by the earlier
of (x) the date that is 30 days (61 days if, without giving effect to the
limitation on conversion contained in Section
3(f), the Holder beneficially owns more than 9.9% of the Common Stock
then outstanding) prior to the date on which such transaction is consummated,
and (y) the date that is 10 days prior to the record date for the determination
of the Company’s shareholders entitled to vote with respect to such transaction,
and (ii) the resulting successor or acquiring entity (if not the Company)
assumes by written instrument (in form and substance reasonably satisfactory to
the Holder) the obligations of the Company under this Note (including, without
limitation, the obligation to make payments of principal and Interest accrued
but unpaid through the date of such consolidation, merger or sale and accruing
thereafter). The above provisions shall apply regardless of whether
or not there would have been a sufficient number of shares of Common Stock
authorized and available for issuance upon conversion of this Note as of the
date of such transaction, and shall similarly apply to successive Major
Transactions. Notwithstanding the foregoing, the Holder may, in lieu
of exercising its rights under this Section
4(b), exercise its rights under Section 5
of this Note.
(c) Distributions. If,
at any time after the Issue Date, the Company declares or makes any distribution
of cash or any other assets (or rights to acquire such assets) to holders of
Common Stock, including without limitation any dividend or distribution to the
Company’s shareholders in shares (or rights to acquire shares) of capital stock
of a subsidiary (a “Distribution”),
the Company shall deliver written notice of such Distribution (a “Distribution
Notice”) to the Holder at least 15 days prior to the earlier to occur of
(i) the record date for determining shareholders entitled to such Distribution
(the “Record
Date”) and (ii) the date on which such Distribution is made (the “Distribution
Date”) (the earlier of such dates being referred to as the “Determination
Date”). Upon receipt of the Distribution Notice, the Holder
shall promptly (but in no event later than three Business Days) notify the
Company whether it has elected (A) to receive the same amount and type of assets
(including, without limitation, cash) being distributed as though the Holder
were, on the Determination Date, a holder of a number of shares of Common Stock
into which this Note is convertible as of such Determination Date (such number
of shares to be determined without giving effect to any limitations on such
conversion) or (B) upon any exercise of this Note on or after the Distribution
Date, to reduce the Conversion Price in effect on the Business Day immediately
preceding the Record Date by an amount equal to the fair market value of the
assets to be distributed divided by the number of
shares of Common Stock as to which such Distribution is to be made, such fair
market value to be reasonably determined in good faith by the Board of Directors
and reasonably acceptable to the Holder. Upon receipt of such
election notice from the Holder, the Company shall timely effectuate the
transaction or adjustment contemplated in the foregoing clause (A)
or
(B), as applicable. If
the Holder does not notify the Company of its election pursuant to the preceding
sentence on or prior to the Determination Date, the Holder shall be deemed to
have elected clause (A)
of the preceding sentence.
-7-
(d) Notice Of
Adjustments. Upon the occurrence of each adjustment or
readjustment of the Conversion Price pursuant to this Section 4
resulting in a change in the Conversion Price by more than one percent, or any
change in the number or type of stock, securities and/or other property issuable
upon Conversion of this Note, the Company, at its expense, shall promptly
compute such adjustment, readjustment or change and prepare and furnish to the
Holder a certificate setting forth such adjustment, readjustment or change and
showing in detail the facts upon which such adjustment, readjustment or change
is based. The Company shall, upon the written request at any time of
the Holder, furnish to the Holder a like certificate setting forth (i) such
adjustment, readjustment or change, (ii) the Conversion Price at the time in
effect and (iii) the number of shares of Common Stock and the amount, if any, of
other securities or property which at the time would be received upon Conversion
of this Note.
(e) Adjustments; Additional
Shares, Securities or Assets. In the event that at any time,
as a result of an adjustment made pursuant to this Section 4,
the Holder of this Note shall, upon conversion of this Note, become entitled to
receive securities or assets (other than Common Stock) then, wherever
appropriate, all references herein to shares of Common Stock shall be deemed to
refer to and include such shares and/or other securities or assets; and
thereafter the number of such shares and/or other securities or assets shall be
subject to adjustment from time to time in a manner and upon terms as nearly
equivalent as practicable to the provisions of this Section
4.
5. ACCELERATION
OF NOTE.
If an
Event of Default, a Change of Control or Major Transaction occurs, the Holder
shall have the right, upon written notice to the Company (an “Acceleration
Notice”), to accelerate the repayment of this Note in
full. The Company shall repay all of the outstanding and unpaid
principal and Interest on this Note within five Business Days of receive a valid
Acceleration Notice. In order to deliver a valid Acceleration Notice,
the Holder must deliver such notice to the Company no later than, in the case of
an Event of Default, the close of business on the third Business Day following
the date on which an Event of Default is no longer continuing and, with respect
to a Change of Control or Major Transaction, the close of business on the third
Business Day following the date on which the Change of Control or Major
Transaction is completed. If the Company fails to
pay the outstanding principal and Interest on this Note when due under this
Section
5, the Holder shall be entitled to interest on such unpaid amount at the
Default Interest Rate from the date on which such payment was due until the date
on which such payment is made. Upon full payment of
principal and Interest on this Note, the Holder shall return this Note to the
Company for cancellation.
6. MISCELLANEOUS.
(a) Failure to Exercise Rights
not Waiver. No failure or delay on the part of the Holder 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 any other or further exercise thereof. All rights
and remedies of the Holder hereunder are cumulative and not exclusive of any
rights or remedies otherwise available. In the event that the Company does not
pay any amount under this Note when such amount becomes due, the Company shall
bear all costs incurred by the Holder in collecting such amount, including,
without limitation, reasonable legal fees and expenses.
-8-
(b) Notices. Any notice,
demand or request required or permitted to be given by the Company or the Holder
pursuant to the terms of this Note shall be in writing and shall be deemed
delivered (i) when delivered personally or by verifiable facsimile transmission,
unless such delivery is made on a day that is not a Business Day, in which case
such delivery will be deemed to be made on the next succeeding Business Day,
(ii) on the next Business Day after timely delivery to an overnight courier and
(iii) on the Business Day actually received if deposited in the U.S. mail
(certified or registered mail, return receipt requested, postage prepaid),
addressed as follows:
If to the
Company:
Ener1,
Inc.
1540
Broadway, Suite 25C
New York,
NY 10036
Attn: General
Counsel
Tel:
1-212-920-3500
Fax:
1-212-920-3510
With
a copy (which shall not constitute notice) to:
Mazzeo
Song & Bradham LLP
708 Third
Avenue, 19th
Floor
New York,
NY 10017
Attn:
David S. Song
Tel: 1-212-599-0700
Fax: 1-212-599-8400
and if to
the Holder, to such address for the Holder as provided by such Holder under the
Purchase Agreement, or as shall be designated by the Holder in writing to the
other parties hereto in accordance with this Section
6(b).
(c) Amendments and
Waivers. No amendment, modification or other change to, or
waiver of any provision of, this Note or any other Note may be made unless such
amendment, modification or change, or request for waiver, is (A) set forth in
writing and is signed by the Company, (B) consented to in writing by the holders
of at least 67% of the unpaid principal amount of the Notes, and (C) applied to
all of the Notes. Upon the satisfaction of the conditions described
in clauses
(A), (B) and
(C)
above, this Note shall be deemed to incorporate the amendment, modification,
change or waiver effected thereby as of the effective date thereof, even if the
Holder did not consent to such amendment, modification, change or
waiver. Notwithstanding the foregoing, the limitation on beneficial
ownership set forth in Section
3(f) may not be amended without the consent of the holders of a majority
of the shares of Common Stock then outstanding; provided, however, that such limitation
may be waived by the Holder upon 60 days’ prior written notice to the Company,
and such waiver shall be valid and shall not require the consent of the Company
or any other holder of Common Stock or Notes.
-9-
(d) Transfer of
Note. The Holder may sell, transfer or otherwise dispose of
all or any part of this Note (including, without limitation, pursuant to a
pledge) to any Person as long as such sale, transfer or disposition is the
subject of an effective registration statement under the Securities Act of 1933,
as amended, and applicable state securities laws, or is exempt from registration
thereunder, and is otherwise made in accordance with the applicable provisions
of the Purchase Agreement. From and after the date of any such sale,
transfer or disposition, the transferee hereof shall be deemed to be the holder
of a Note in the principal amount acquired by such transferee, and the Company
shall, as promptly as practicable (but in no event later than three Business
Days from the date it receives notice thereof), issue and deliver to such
transferee a new Note identical in all respects to this Note, in the name of
such transferee. The Company shall be entitled to treat the original Holder as
the holder of this entire Note unless and until it receives written notice of
the sale, transfer or disposition hereof.
(e) Lost or Stolen
Note. Upon receipt by the Company of evidence of the loss,
theft, destruction or mutilation of this Note, and (in the case of loss, theft
or destruction) of indemnity or security reasonably satisfactory to the Company,
and upon surrender and cancellation of the Note, if mutilated, the Company shall
execute and deliver to the Holder a new Note identical in all respects to this
Note.
(f) Governing Law; Jurisdiction;
Waiver of Jury Trial.
(i) This
Note shall be governed by and construed under the laws of the State of New York
applicable to contracts made and to be performed entirely within the State of
New York. Each party hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in the City and County of
New York for the adjudication of any dispute hereunder or in connection herewith
or with any transaction contemplated hereby, and hereby irrevocably waives, and
agrees not to assert in any suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of any such court, that such suit, action
or proceeding is brought in an inconvenient forum or that the venue of such
suit, action or proceeding is improper. The Holder and the Company
hereby irrevocably waive personal service of process and consent to process
being served in any such suit, action or proceeding by mailing a copy thereof to
such Person at the address in effect for notices to it under this Note and agree
that such service shall constitute good and sufficient service of process and
notice thereof. Nothing contained herein shall be deemed to limit in
any way any right to serve process in any manner permitted by law.
(ii) THE
HOLDER AND THE COMPANY EACH ACKNOWLEDGES AND AGREES THAT ANY DISPUTE OR
CONTROVERSY THAT MAY ARISE UNDER THIS NOTE IS LIKELY TO INVOLVE COMPLICATED AND
DIFFICULT ISSUES AND, THEREFORE, EACH PERSON HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT SUCH PERSON MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO
THIS NOTE, OR THE BREACH, TERMINATION OR VALIDITY OF THIS NOTE, OR THE
TRANSACTIONS CONTEMPLATED HEREBY. THE HOLDER AND THE COMPANY EACH CERTIFIES AND
ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN
THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (II) EACH SUCH
PERSON UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (III)
EACH SUCH PERSON MAKES THIS WAIVER VOLUNTARILY, AND (IV) EACH SUCH PERSON HAS
BEEN INDUCED TO UNDERTAKE THE OBLIGATIONS SET FORTH IN THIS NOTE BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION
6(f)(ii).
-10-
(g) Successors and
Assigns. The terms and conditions of this Note shall inure to
the benefit of and be binding upon the respective successors (whether by merger
or otherwise) and permitted assigns of the Company and the Holder. The Company
may not assign its rights or obligations under this Note except as specifically
required or permitted pursuant to the terms hereof.
(h) Usury. This
Note is subject to the express condition that at no time shall the Company be
obligated or required to pay interest hereunder at a rate which could subject
the Holder to either civil or criminal liability as a result of being in excess
of the maximum interest rate which the Company is permitted by applicable law to
contract or agree to pay. If by the terms of this Note, the Company is at
any time required or obligated to pay interest hereunder at a rate in excess of
such maximum rate, the rate of interest under this Note shall be deemed to be
immediately reduced to such maximum rate and the interest payable shall be
computed at such maximum rate and all prior interest payments in excess of such
maximum rate shall be applied and shall be deemed to have been payments in
reduction of the principal balance of this Note.
[Signature
Page to Follow]
-11-
IN
WITNESS WHEREOF, the Company has caused this Note to be signed in its name by
its duly authorized officer on the date first above written.
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ENER1,
INC.
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By:
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Name:
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Title:
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-12-
ANNEX I
NOTICE OF
CONVERSION
The
undersigned hereby elects to convert principal of the 6% Senior Convertible Note
(the “Note”)
issued by Ener1, Inc. (the “Company”)
into shares of common stock (“Common
Stock”) of the Company according to the terms and conditions of the Note.
Capitalized terms used herein and not otherwise defined shall have the
respective meanings set forth in the Note.
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Date
of Conversion:
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Principal
Amount of
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Note
to be Converted:
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Number
of Shares of
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Common
Stock to be Issued:
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Name
of Holder:
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Address:
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Signature:
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| Name: | |||
| Title: | |||
Holder Requests Delivery to
be Made: (check one)
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¨
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By
Delivery of Physical Certificates to the Above Address
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¨
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If
Available, Through Depository Trust Corporation
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(Account________________________)
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