Exhibit 10.12
 
THIS PROMISSORY NOTE AND THE SECURITIES ISSUABLE UPON CONVERSION HEREOF HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY
STATE SECURITIES LAWS AND MAY NOT BE SOLD, OFFERED FOR SALE, OR TRANSFERRED IN
THE ABSENCE OF EITHER AN EFFECTIVE REGISTRATION UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL
FOR THE COMPANY THAT SUCH TRANSACTION IS EXEMPT FROM REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS. 
INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS
OF THIS INVESTMENT FOR AN IN-DEFINITE PERIOD OF TIME.  THE ISSUER OF THESE
SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY
TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN
COMPLIANCE WITH THE ACT AND ALL APPLICABLE STATE SECURITIES LAWS.
AMENDED AND RESTATED CONVERTIBLE PROMISSORY NOTE
$_____________
Issue Date: _______________

 
This Amended and Restated Convertible Promissory Note (this "Note") is hereby
issued by OrangeHook, Inc., a Minnesota corporation (the "Borrower"), to
______________ (the "Lender"), and amends, restates, supersedes and replaces in
its entirety that certain Convertible Promissory Note issue by the Company on
____________ (the "Original Note").  In consideration for the receipt of
additional investment and Lender's agreement to amend and restate the Original
Note, the Borrower hereby promises to pay to Lender, the principal sum of
______________ Dollars ($_____________) (the "Principal Amount"), together with
interest thereon accruing on and from the Issue Date listed above until the
entire Balance is paid (or converted, as provided in Section 6 hereof), at an
annual rate equal to ten percent (10%).  The Principal Amount as of the date
hereof consists of $_____________ in principal and accrued interest owed by
Borrower to Lender under the Original Note and an additional $___________ of
principal borrowed by Lender to Borrower as of the date hereof.  Interest shall
be calculated based on a 365-day year, compounded annually, but in no event
shall the rate of interest exceed the maximum rate, if any, allowable under
applicable law.  "Balance" means, at the applicable time, the sum of all then
outstanding principal of this Note, all then accrued but unpaid interest and all
other amounts then accrued but unpaid under this Note.
Borrower and Lender shall be bound by, all the terms, conditions and provisions
of the Subscription Agreement entered into in connection with the issuance of
this Note.  Unless otherwise converted in accordance with Section 6 below, all
principal and accrued and unpaid interest under this Note shall become due and
payable on the October 15, 2017 (the "Maturity Date").  Capitalized terms used
herein but not defined herein shall have the meanings ascribed to them in the
Subscription Agreement between the Borrower and Lender.
The following is a statement of the rights of Lender and the terms and
conditions to which this Note is subject and to which the Lender, by acceptance
of this Note, agrees:
1.          Payment of Note and Issuance of Warrant.
(a)          If this Note has not been previously converted (as provided in
Section 6 hereof), then the Balance of this Note shall, on the Maturity Date, be
payable in cash.  Unless the indebtedness outstanding under this Note is
converted in accordance with Section 6 hereof, all payments on account of
principal and interest shall be made in lawful money of the United States of
America at the principal office of the Lender, or such other place as the holder
hereof may from time to time designate in writing to the Borrower.

(b)          Upon any payment by the Borrower of outstanding Balance (whether
prepaid, paid at maturity or otherwise), the Borrower will issue to Lender a
two-year warrant to purchase the number of shares of its Common Stock equal to
the amount of Balance then paid to Lender by Borrower divided by $7.00.  Any
such warrant will have an exercise price of $7.00 per share and will be in a
form substantially similar to the form of warrant previously used by the
Borrower (with such changes as the Borrower's board of directors deems necessary
or appropriate in light of then-current factors).
2.          Prepayment.  Borrower may prepay this Note, including outstanding
principal and interest, at any time.
 
 
 
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3.          Ranking of Notes; Application of Payments.  This Note shall rank
pari passu with all other amended and restated convertible promissory notes of
the Company issued on or around the date hereof.  All payments and recoveries
payable on account of principal and unpaid interest on the notes shall be paid
and applied ratably and proportionately on the balances of all such outstanding
notes on the basis of their principal amount on the Issue Date hereof.  Subject
to the foregoing provisions, all payments will be applied first to the repayment
of accrued fees and expenses under this Note, then to accrued interest until all
then outstanding accrued interest has been paid in full, and then to the
repayment of principal until all principal has been paid in full.  Any payments
in excess of the aggregate Balance of the Note shall be returned to Borrower. 
In the event Lender receives payments in excess of its pro rata share of the
Borrower's payments to all other holders of Notes, then Lender shall return such
excess payment to Borrower and Borrower shall hold in trust all such excess
payments for the benefit of the holders of the other notes and shall pay such
amounts held in trust to such other holders upon demand by such holders.
4.          Transfer and Exchange.  The holder of this Note may, prior to the
Maturity Date or the conversion in full of this Note in accordance with Section
6, surrender this Note at the principal offices of the Borrower for transfer or
exchange.  Within a reasonable time after notice to the Borrower from such
holder of its intention to make such exchange and without expense to such
holder, except for any transfer or similar tax which may be imposed on the
transfer or exchange, the Borrower shall issue in exchange therefor another note
or notes for the same aggregate principal amount as the unpaid principal amount
of the Note so surrendered, having the same maturity and rate of interest,
containing the same provisions and subject to the same terms and conditions as
the Note so surrendered.  Each new Note shall be made payable to such person or
persons, or transferees, as the holder of such surrendered Note may designate,
and such transfer or exchange shall be made in such a manner that no gain or
loss of principal or interest shall result therefrom.  The Borrower may elect
not to permit a transfer of the Note if it has not obtained satisfactory
assurance that such transfer: (a) is exempt from the registration requirements
of, or covered by an effective registration statement under, the Securities Act
of 1933, as amended, and the rules and regulations thereunder and (b) is in
compliance with all applicable state securities laws, including without
limitation receipt of an opinion of counsel, which opinion shall be reasonably
satisfactory to the Borrower.
5.          New Note.  Upon receipt of evidence reasonably satisfactory to the
Borrower of the loss, theft, destruction or mutilation of the Note, the Borrower
will issue a new Note, of like tenor and amount and dated the date to which
interest has been paid, in lieu of such lost, stolen, destroyed or mutilated
Note, and in such event the Lender agrees to indemnify and hold harmless the
Borrower in respect of any such lost, stolen, destroyed or mutilated Note.
6.          Conversion of Note.
(a)          Conversion upon Demand of Lender.  At any time after the issuance
of this Note, and to the extent there is then an outstanding Balance, the
Lender, in its sole discretion, may, upon written notice to the Company and
surrender of this Note, convert all or any portion of the then outstanding
Balance into shares of the Company's common stock, par value $0.01 per share
(the "Common Stock"), at a price of $7.00 per share of Common Stock (the
"Conversion Price"); provided, however, that the Conversion Price shall be
adjusted in the event the Borrower subdivides or combines its Common Stock or
declares a dividend payable on its Common Stock in shares of Common Stock, so
that the shares of Common Stock issuable upon a conversion immediately after
such event as a percentage of then-outstanding Common Stock is in the same
proportion to the number of shares issuable upon a conversion immediately prior
to such event as a percentage of then-outstanding Common Stock.
(b)          Termination of Rights.  Except for the rights to obtain
certificates representing Common Stock upon conversion and as set forth in
Section 6(c) below, all rights with respect to this Note shall terminate upon
the effective conversion or repayment of the entire Balance of the Note, whether
or not this Note has been surrendered to Borrower for cancellation.
(c)          Delivery of Stock Certificates.  Subject to Section 6(b) above, as
promptly as practicable after any conversion of this Note and Lender's surrender
of this Note to the Company, Borrower at its expense will issue and deliver to
Lender a certificate or certificates evidencing the number of shares of Common
Stock as are issuable to Lender in connection with a conversion under this
Section 6.  No fractional shares of any of Borrower's Common Stock will be
issued in connection with any conversion hereunder.  In lieu of fractional
shares which would otherwise be issuable, Borrower shall pay cash equal to the
Balance remaining after the conversion into a whole number of shares of Common
Stock, as appropriate.
 
 
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(d)          Effect of Certain Transactions.  Lender acknowledges and agrees
that the Borrower may effect a merger or other transaction in order to combine
with a corporation ("Corporation") or a subsidiary of the Corporation having a
class of securities registered under Section 12 or subject to Section 15(d) of
the Securities Exchange Act of 1934, as amended (the "Transaction").  Upon
consummation of such a Transaction, the Lender hereby agrees that: (i) if
holders of the Borrower's Common Stock immediately prior to such Transaction
receive a security of the Corporation as consideration for such holders' shares
of Common Stock in connection with any such Transaction, the conversion rights
pursuant to Section 6 hereof and the terms of any warrant issued or issuable
under Section 1 hereof shall automatically be amended such that the Lender, upon
exercise of conversion rights in Section 6 hereof or any warrant issued under
Section 1 hereof, will receive the same such security of the Corporation as
Lender would then hold if Lender had exercised such conversion rights
immediately prior to the Transaction and (ii) the Corporation shall become the
Borrower and this Note shall become the obligation of the Corporation.
7.          Events of Default.  Each of the following shall constitute an "Event
of Default" hereunder:
(a)          The Borrower shall fail to pay any principal, interest or other
amount payable hereunder on the applicable due date;
(b)          The Borrower shall (i) voluntarily terminate operations or apply
for or consent to the appointment of, or the taking of possession by, a
receiver, custodian, trustee or liquidator in respect of the Borrower or of all
or a substantial part of the assets of the Borrower, (ii) admit in writing its
inability, to pay debts as the debts become due, (iii) make a general assignment
for the benefit of its creditors, (iv) commence a voluntary case under the
Federal Bankruptcy Code (as now or hereafter in effect), (v) file a petition
seeking to take advantage of any other law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or adjustment of debts, (vi) fail to
controvert in a timely and appropriate manner, or acquiesce in writing to, any
petition filed against it in an involuntary case under the Federal Bankruptcy
Code or applicable state bankruptcy laws or (vii) take any corporate action for
the purpose of effecting any of the foregoing;
(c)          Default in the performance of any other obligation under this Note
or the Subscription Agreement and such failure continues for five (5) days after
written notice to Borrower; or
(d)          Any representation, warranty or statement made or furnished to the
Lender by or on behalf of the Borrower proves to be false or erroneous in a
material respect when made or furnished.
If any Event of Default shall occur, then, at any time thereafter while such
Event of Default is continuing, the Lender by written notice to the Borrower
(the "Default Notice") may declare the entire unpaid principal amount of this
Note, together with all accrued and unpaid interest thereon, to be due and
payable immediately.
8. Unsecured Indebtedness.  This Note represents general, unsecured obligations
of the Borrower and will rank on parity with all other unsecured indebtedness of
the Borrower; provided, however, that certain directors of the Borrower may
enter into separate agreement with the Lender whereby such directors personally
guarantee the Borrower's obligations hereunder for the benefit of the Lender.
9. Governing Law.  This Note is made in and shall be interpreted and enforced in
accordance with the laws of the State of Minnesota, and each of the parties
hereto irrevocably consents to personal jurisdiction in the state or federal
courts in the State of Minnesota.
 
 
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10.          Usury.  In the event any interest is paid on this Note which is
deemed to be in excess of the then legal maximum rate, then that portion of the
interest payment representing an amount in excess of the then legal maximum rate
shall be deemed a payment of the Principal Amount and applied against the
Principal Amount of this Note.
11.          Collection Expenses.  The Borrower further agrees to pay all
expenses, including reasonable attorneys' fees, incurred by the holder of this
Note in endeavoring to collect any amounts payable hereunder which are not paid
when due.
12.          Waiver.  Borrower hereby waives presentment, protest, demand for
payment, notice of dishonor, and any and all other notices or demands in
connection with the delivery, acceptance, performance, default, or enforcement
of this Note.
13.          Severability.  The invalidity or unenforceability of any provision
hereof shall in no way affect the validity or enforceability of any other
provision.
14.          Addresses for Notices, etc.  Any notice required or permitted
hereunder shall be given in writing and shall be conclusively deemed effectively
given upon personal delivery or delivery by courier, or on the first business
day after transmission if sent by confirmed facsimile or email transmission, or
three (3) business days after deposit in the United States mail, by registered
or certified mail, postage prepaid, addressed (a) if to Borrower, at Borrower's
address as set forth in the Subscription Agreement, and (b) if to Lender, at
Lender's address as set forth in the Subscription Agreement or the signature
page hereto, or at such other address as the Borrower or Lender may designate by
advance written notice.  For purposes of this Note, a "business day" means a
weekday on which banks are open for general banking business in New York City,
New York.
15.          Headings; Interpretation.  In this Note, (a) the meaning of defined
terms shall be equally applicable to both the singular and plural forms of the
terms defined; (b) the captions and headings are used only for convenience and
are not to be considered in construing or interpreting this Note and (c) the
words "including," "includes" and "include" shall be deemed to be followed by
the words "without limitation".  All references in this Note to sections,
paragraphs, exhibits and schedules shall, unless otherwise provided, refer to
sections and paragraphs hereof and exhibits and schedules attached hereto, all
of which exhibits and schedules are incorporated herein by this reference.
 
 
[Signature page follows]
 
 
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IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed by
its duly authorized officers as of the date first above written.

OrangeHook, Inc.
 

By:______________________________
Name:   James L. Mandel
Title:     Chief Executive Officer

LENDER ACKNOWLEDGEMENT
AND AGREEMENT:

By: _________________________________________________
Name:
Title (if Lender is an entity):

Lender's Address: 
______________________________
______________________________
______________________________
 
 

 
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