exh41convertiblenotedate






THIS SECURITY (INCLUDING ANY SECURITIES ISSUABLE UPON  CONVERSION) HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT  OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR APPLICABLE STATE  SECURITIES LAWS. THIS SECURITY (INCLUDING ANY SECURITIES  ISSUABLE UPON CONVERSION) HAS BEEN ACQUIRED FOR INVESTMENT  AND NOT WITH A VIEW TO ITS DISTRIBUTION OR RESALE, AND MAY NOT  BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN  EFFECTIVE REGISTRATION STATEMENT FOR THIS SECURITY (INCLUDING  ANY SECURITIES ISSUABLE UPON CONVERSION) UNDER THE SECURITIES  ACT AND APPLICABLE STATE SECURITIES LAWS, OR AN EXEMPTION  THEREFROM.  VIRGIN ORBIT HOLDINGS, INC.   SENIOR UNSECURED CONVERTIBLE NOTE  CN-1  US$25,000,000.00 November 4, 2022  FOR VALUE RECEIVED, Virgin Orbit Holdings, Inc., a corporation duly  organized and validly existing under the laws of the state of Delaware (the “Borrower”),  hereby promises to pay to VIRGIN INVESTMENTS LIMITED, or registered assigns, at  the address set forth in Section 12.01 of this Senior Unsecured Convertible Note (this  “Note”), the principal sum of TWENTY-FIVE MILLION DOLLARS ($25,000,000.00),  together with interest accrued thereon from time to time as provided herein, on the  Maturity Date (as defined below).  ARTICLE 1  DEFINITIONS; INTERPRETATIONS  Section 1.01. Definitions.  The terms defined in this Section 1.01 (except as  herein otherwise expressly provided or unless the context otherwise requires) for all  purposes of this Note shall have the respective meanings specified in this Section 1.01.  The words “herein,” “hereof,” “hereunder,” and words of similar import refer to this Note  as a whole and not to any particular Article, Section or other subdivision. The terms  defined in this Article include the plural as well as the singular. Unless otherwise noted,  references to “U.S. Dollars” or “$” shall mean the currency of the United States.  “Affiliate” of any specified Person means any other Person directly or indirectly  controlling or controlled by or under direct or indirect common control with such  specified Person. For the purposes of this definition, “control,” when used with respect to  any specified Person means the power to direct or cause the direction of the management  and policies of such Person, directly or indirectly, whether through the ownership of  voting securities, by contract or otherwise; and the terms “controlling” and “controlled”  have meanings correlative to the foregoing.  EXECUTION VERSION Exhibit 4.1 





 






2    “Bankruptcy Law” shall have the meaning specified in Section 6.01.  “Board of Directors” means the Board of Directors of the Borrower or any duly  authorized committee of such Board of Directors.  “Borrower” means Virgin Orbit Holdings, Inc., a corporation duly organized and  existing under the laws of the State of Delaware, until a successor Person shall replace it  pursuant to the applicable provisions of this Note, and thereafter “Borrower” shall mean  such successor Person.  “Business Combination Event” shall have the meaning specified in Section 7.01.  “Business Day” means any day other than a Saturday, a Sunday or a day on  which the Federal Reserve Bank of New York is authorized or required by law or  executive order to close or be closed.  “Capital Stock” of any Person means any and all shares, interests, rights to  purchase, warrants, options, participations or other equivalents of or interests in (however  designated) the equity of such Person, but excluding any debt securities convertible into  such equity.  “Cash” or “cash” means such coin or currency of the United States as at any time  of payment is legal tender for the payment of public and private debts.  “Clause A Distribution” shall have the meaning specified in Section 4.07(c).  “Clause B Distribution” shall have the meaning specified in Section 4.07(c).  “Clause C Distribution” shall have the meaning specified in Section 4.07(c).  “close of business” means 5:00 p.m. (New York City time).  “Code” means the Internal Revenue Code of 1986, as amended from time to time.  “Commission” means the U.S. Securities and Exchange Commission.   “Common Equity” of any Person means Capital Stock of such Person that is  generally entitled (a) to vote in the election of directors of such Person or (b) if such  Person is not a corporation, to vote or otherwise participate in the selection of the  governing body, partners, managers or others that will control the management or  policies of such Person.  “Common Stock” means the shares of common stock of the Borrower, par value  $0.0001 per share, at the date of this Note, subject to Section 4.10.  “Conversion Cap” shall have the meaning specified in Section 4.03(g).   “Conversion Date” means, in respect of any conversion of this Note, the related  Fixed Conversion Date or Financing Conversion Date, as the case may be.  





 






3    “Conversion Obligation” means, in respect of any conversion of this Note, the  related Fixed Conversion Obligation or Financing Conversion Obligation, as the case  may be.  “Default” means any event, act or condition that with notice or lapse of time, or  both, would constitute an Event of Default.  “Event of Default” shall have the meaning specified in Section 6.01.  “Ex-Dividend Date” means the first date on which shares of Common Stock  trade on The Nasdaq Global Market, or on the applicable stock exchange on which  Common Stock is then traded, regular way, without the right to receive the issuance,  dividend or distribution in question from the Borrower.  “Exchange Act” means the Securities Exchange Act of 1934 and the rules and  regulations promulgated thereunder, in each case as amended.  “Expiration Date” shall have the meaning specified in Section 4.07(e).  “Expiration Time” shall have the meaning specified in Section 4.07(e).  “Financing Closing Date” means, in respect of any Qualified Financing, the  closing date of such Qualified Financing.  “Financing Conversion Date” shall have the meaning specified in Section  4.03(b).   “Financing Conversion Obligation” shall have the meaning specified in Section  4.03(b).   “Financing Conversion Rate” means, in respect of any Qualified Financing and  with respect to each $1,000 principal amount of this Note, a number of the Qualified  Securities in respect of such Qualified Financing (denominated in shares, units or notes,  as applicable (with any such Qualified Securities that have a liquidation preference or  principal amount being deemed to be denominated in a liquidation preference or principal  amount per share, unit or note, as the case may be, as the Holder determines in good faith  and in a commercially reasonable manner)) equal to $1,000 divided by the purchase price  per share, unit or note, as applicable, of such Qualified Securities paid by the investors in  the Qualified Financing, rounded to the nearest 1/10,000th of a share, unit or note, as  applicable.  “Fixed Conversion Obligation” shall have the meaning specified in Section  4.01(a).  “Fixed Conversion Rate” shall have the meaning specified in Section 4.01(a).  “Foreign Subsidiary” means (a) any Subsidiary of the Borrower (i) that has no  material assets other than Capital Stock in or indebtedness of one or more Foreign  





 






4    Subsidiaries or (ii) that is not a “United States person” within the meaning of Section  7701(a)(30) of the Code or (b) any other Subsidiary of the Borrower, for so long as such  Subsidiary would not be able to execute a Guarantee without creating an investment in  “United States property” (within the meaning of Section 956 of the Code).  “Form of Assignment and Transfer” shall mean the “Form of Assignment and  Transfer” attached as Attachment 3 to this Note.  “Form of Fundamental Change Repurchase Notice” shall mean the “Form of  Fundamental Change Repurchase Notice” attached as Attachment 2 to this Note.  “Form of Notice of Conversion” shall mean the “Form of Notice of Conversion”  attached as Attachment 1 to this Note.  “Fundamental Change” shall be deemed to have occurred at the time after this  Note is originally issued if any of the following occurs:  (a) a “person” or “group” (other than the Holder or an Affiliate  thereof) within the meaning of Section 13(d) of the Exchange Act, other than the  Borrower, its Wholly Owned Subsidiaries and the employee benefit plans of the  Borrower and its Wholly Owned Subsidiaries, has become the direct or indirect  “beneficial owner,” as defined in Rule 13d-3 under the Exchange Act, of (x) the  Common Stock representing more than 50% of the voting power of the Common  Stock or (y) Common Equity of the Borrower representing more than 50% of the  voting power of all Common Equity of the Borrower;  (b) the consummation of (A) any recapitalization, reclassification or  change of the Common Stock (other than changes resulting from a subdivision or  combination) as a result of which the Common Stock would be converted into, or  exchanged for, stock, other securities, other property or assets; (B) any share  exchange, consolidation or merger of the Borrower pursuant to which the  Common Stock will be converted into cash, securities or other property or assets;  or (C) any sale, lease or other transfer in one transaction or a series of transactions  of all or substantially all of the consolidated assets of the Borrower and its  Subsidiaries, taken as a whole, to any Person other than one of the Borrower’s  Wholly Owned Subsidiaries; provided, however, that a transaction described in  subclauses (A) or (B) in which the holders of all classes of the Borrower’s  Common Equity immediately prior to such transaction own, directly or indirectly,  more than 50% of all classes of Common Equity of the continuing or surviving  corporation or transferee or the parent thereof immediately after such transaction  in substantially the same proportions as such ownership immediately prior to such  transaction shall not be a Fundamental Change pursuant to this clause (b); or  (c) the stockholders of the Borrower approve any plan or proposal for  the liquidation or dissolution of the Borrower.  





 






5    If any transaction in which the Common Stock is replaced by the securities of  another entity occurs, following the effective date of such transaction references to the  Borrower in this definition shall instead be references to such other entity.  “Fundamental Change Borrower Notice” shall have the meaning specified in  Section 9.01(b).  “Fundamental Change Effective Date” means the date on which any  Fundamental Change becomes effective.  “Fundamental Change Repurchase Date” shall have the meaning specified in  Section 9.01(a).  “Fundamental Change Repurchase Notice” shall have the meaning specified in  Section 9.01(d).  “Fundamental Change Repurchase Price” of this Note, means 100% of the  principal amount of this Note to be repurchased pursuant to Article 9 plus accrued and  unpaid interest on such principal amount of this Note to be repurchased, if any, to, but  excluding, the Fundamental Change Repurchase Date.  “Guarantees” means the joint and several guarantees by the Guarantors of the  Borrower’s obligations under this Note pursuant to Article 11.  “Guarantors” means each of (a) the Borrower’s Subsidiaries listed on the  signature pages to this Note, (b) any other Subsidiary of the Borrower that becomes a  Guarantor in accordance with Section 3.04 or Section 11.04 and (c) the respective  successors and assigns of such Subsidiaries, as required under Article 11, in each case  until such time as any such Subsidiary shall be released and relieved of its obligations  pursuant to Section 11.06.  “Guarantor Business Combination Event” shall have the meaning specified in  Section 11.04.  “Holder” means Virgin Investments Limited, a company duly organized and  existing under the laws of the British Virgin Islands.  “Interest Payment Date” means each May 4 and November 4 of each year,  beginning on May 4, 2023; provided, however, that if any Interest Payment Date falls on  a date that is not a Business Day, such payment of interest shall be postponed until the  next succeeding Business Day, and no interest or other amount shall be paid as a result of  such postponement.  “Interest Rate” means 6.00% per annum; provided that the Interest Rate shall  increase to 10% per annum upon the occurrence and during the continuance of any Event  of Default.  





 






6    “Issue Date” of this Note means the date on which this Note was originally issued  or deemed issued as set forth on the face of this Note.  “Last Reported Sale Price” of the Common Stock on any date means the closing  sale price per share of the Common Stock (or if no closing sale price is reported, the  average of the bid and ask prices per share or, if more than one in either case, the average  of the average bid and the average ask prices per share) on such date reported on The  Nasdaq Global Market or other principal U.S. securities exchange on which the Common  Stock is then traded. If the Common Stock is not listed for trading on a United States  national or regional securities exchange on such date, the “Last Reported Sale Price” of  the shall be the last quoted bid price for the Common Stock in the over-the-counter  market on the relevant date as reported by OTC Markets Group Inc. or a similar  organization. If the Common Stock is not so quoted, the “Last Reported Sale Price” shall  be the average of the mid-point of the last bid and ask prices for the Common Stock on  such date from each of at least three nationally recognized independent investment  banking firms selected by the Borrower for this purpose. The “Last Reported Sale  Price” of the Common Stock will be determined without reference to extended or after  hours trading or any other trading outside regular trading session hours.  “Lien” means any lien, mortgage, pledge, security interest, charge, or  encumbrance of any kind (including any conditional sale or other title retention  agreement or any lease in the nature thereof) and any agreement to give or refrain from  giving any lien, mortgage, pledge, security interest, charge, or other encumbrance of any  kind.  “Majority Holders” means the registered holders of a majority of the outstanding  aggregate principal amount of the Senior Unsecured Convertible Notes issued pursuant to  the Subscription Agreement (but excluding, for this purpose, any such Senior Unsecured  Convertible Notes that are held by the Borrower or by any Subsidiary thereof).  “Maturity Date” shall have the meaning specified in Section 2.01.   “Merger Event” shall have the meaning specified in Section 4.10(a).   “Minimum Financing Threshold” means $50,000,000.  “Non-Qualified Financing” means any financing by the Borrower that would  have been a Qualified Financing pursuant to clause (a) of the definition thereof but for  the gross cash proceeds of such financing being less than the Minimum Financing  Threshold.   “Note” shall have the meaning specified in the preamble.  “Notice of Conversion” shall have the meaning specified in Section 4.03(a)(ii).  “open of business” means 9:00 a.m. (New York City time).  “Optional Redemption” shall have the meaning specified in Section 10.01.   





 






7    “Outstanding,” when used with reference to this Note, shall mean, as of any  particular time, any portion of the principal amount of this Note, except:  (i) The portion of this Note that has been paid pursuant to Section 12.13 or  Notes in lieu of which, or in substitution for which, other Notes shall have been issued by  the Borrower pursuant to the terms of Section 12.13;   (ii) The portion of this Note converted pursuant to Article 4 and required to be  canceled pursuant to Section 2.04; and  (iii) The portion of this Note redeemed by the Borrower pursuant to Article 10.  “Permitted Liens” means (i) Liens for taxes, assessments or charges of any  governmental authority for claims that are not material, or are not yet due or are being  contested in good faith by appropriate proceedings that have the effect of preventing  forfeiture or sale of the assets to which such Liens attach, and, in each case, with respect  to which adequate reserves or other appropriate provisions are being maintained in  accordance with GAAP, (ii) statutory Liens or bankers Liens, (iii) any attachment or  judgment Lien not constituting an Event of Default and (iv) such other Liens as may be  permitted from time to time, with the written consent of the Holder, which shall not be  unreasonably withheld, delayed or conditioned.  “Person” or “person” means any individual, corporation, partnership, limited  liability company, joint venture, association, joint-stock company, trust, unincorporated  organization, government or any agency or political subdivision thereof or any syndicate  or group that would be deemed to be a “person” under Section 13(d)(3) of the Exchange  Act or any other entity.  “Qualified Financing” means each of (a) a bona fide third-party financing (other  than, for the avoidance of doubt, where one or more of Virgin Group Holdings Limited,  the Holder or any other Affiliate of Virgin Group Holdings Limited is/are the sole  investor(s)) by the Borrower in the form of Common Stock or any securities convertible  into, or exchangeable or exercisable for, Common Stock (other than pursuant to equity  incentive plans of the Borrower where the sale of such securities is registered on Form S- 8 under the Securities Act) for gross cash proceeds to the Borrower of at least the  Minimum Financing Threshold, in one or more transactions or series of related and  substantially similar and simultaneous transactions at the same purchase price from third  parties unaffiliated with Virgin Group Holdings Limited and its Affiliates, and (b) any  Non-Qualified Financing that the Holder elects, by written notice to the Borrower after  the Borrower’s delivery of the notice specified in Section 4.02(b) and prior to the  applicable Financing Closing Date, to be deemed to be a “Qualified Financing” in  respect of all or any portion of this Note (if the portion with respect to which such  election is made is $1,000 principal amount or a multiple thereof). For the avoidance of  doubt. the participation by Virgin Group Holdings Limited or its Affiliates in a financing  shall not disqualify such financing from being a Qualified Financing (but amounts  invested in such financing by Virgin Group Holdings Limited or its Affiliates shall not  count toward satisfying the Minimum Financing Threshold).  





 






8    “Qualified Securities” means, with respect to any Qualified Financing, the  Common Stock or securities convertible into, or exchangeable or exercisable for,  Common Stock sold by the Borrower in such Qualified Financing.  “Qualified Successor Entity” means, with respect to a Business Combination  Event, a corporation; provided, however, that a limited liability company, limited  partnership or other similar entity will also constitute a Qualified Successor Entity with  respect to such Business Combination Event if both of the following conditions are  satisfied: (i) either (x) such limited liability company, limited partnership or other similar  entity, as applicable, is treated as a corporation that is organized in the United States or is  a direct or indirect, wholly owned subsidiary of, and disregarded as an entity separate  from, a corporation that is organized in the United States, in each case for U.S. federal  income tax purposes; or (y) the Borrower has received an opinion of a nationally  recognized tax counsel to the effect that such Business Combination Event will not be  treated as an exchange under Section 1001 of the Code for the Holder; and (ii) such  Business Combination Event constitutes a Merger Event whose Reference Property  consists solely of any combination of cash in U.S. dollars and shares of common stock or  other corporate Common Equity interests of an entity that is (x) treated as a corporation  for U.S. federal income tax purposes; (y) duly organized and existing under the laws of  the United States of America, any State thereof or the District of Columbia; and (z) a  direct or indirect parent of the limited liability company, limited partnership or similar  entity that is disregarded from such corporation for U.S. federal income tax purposes.  “Receiver” shall have the meaning specified in Section 6.01.  “Record Date” means, with respect to any dividend, distribution or other  transaction or event in which the holders of Common Stock (or other applicable security)  have the right to receive any cash, securities or other property or in which the Common  Stock (or such other security) is exchanged for or converted into any combination of  cash, securities or other property, the date fixed for determination of holders of the  Common Stock (or such other security) entitled to receive such cash, securities or other  property (whether such date is fixed by the Board of Directors, by statute, by contract or  otherwise).  “Redemption Date” shall have the meaning specified in Section 10.02(a).   “Redemption Notice” shall have the meaning specified in Section 10.02(a).   “Redemption Price” of this Note, means 100% of the principal amount of this  Note to be redeemed pursuant to Article 10 plus accrued and unpaid interest on such  principal amount of this Note to be redeemed, if any, to, but excluding, the Redemption  Date.  “Reference Property” shall have the meaning specified in Section 4.10(a).  “Rights” means any common stock or preferred stock purchase right or warrant,  as the case may be, that all or substantially all shares of Common Stock may be entitled  to receive under a Rights Plan.  





 






9    “Rights Plan” means any common stock or preferred stock rights plan or any  similar plan in effect as of the date of this Note or adopted by the Borrower after the date  hereof or any replacement or successor rights plan.  “Rule 144” means Rule 144 as promulgated under the Securities Act.  “Securities Act” means the Securities Act of 1933 and the rules and regulations  promulgated thereunder, in each case as amended.  “Significant Subsidiary” means any Subsidiary of the Borrower that satisfies the  criteria of a “significant subsidiary” set forth in Rule 1-02(w) of Regulation S-X under  the Exchange Act.  “Spin-Off” shall have the meaning specified in Section 4.07(c).  “Subscription Agreement” means that certain Subscription Agreement, dated as  of November 4, 2022, by and among the Borrower, the Holder and the guarantors  thereunder, as the same may be amended from time to time.  “Subsidiary” means, with respect to any Person, any corporation, association,  partnership or other business entity of which more than 50% of the total voting power of  shares of Capital Stock or other interests (including partnership interests) entitled  (without regard to the occurrence of any contingency) to vote in the election of directors,  managers, general partners or trustees thereof is at the time owned or controlled, directly  or indirectly, by (i) such Person; (ii) such Person and one or more Subsidiaries of such  Person; or (iii) one or more Subsidiaries of such Person.  “Successor Entity” shall have the meaning specified in Section 7.01(a).   “Termination of Trading” means the Common Stock (or other common stock  into which this Note is convertible) ceases to be listed or quoted on any of The New York  Stock Exchange, The NYSE American, The Nasdaq Global Select Market or The Nasdaq  Global Market (or any of their respective successors).  “Trading Day” means a day during which (i) trading in the Common Stock  generally occurs and (ii) a Last Reported Sale Price (other than a Last Reported Sale  Price of the type referred to in the third sentence of the definition of Last Reported Sale  Price) for the Common Stock is available for such day; provided that if the Common  Stock is not admitted for trading or quotation on or by any exchange, bureau or other  organization referred to in the definition of Last Reported Sale Price (excluding the third  sentence of that definition), “Trading Day” means a Business Day.  “Trigger Event” shall have the meaning specified in Section 4.07(c).   “United States” means the United States of America.  “unit of Reference Property” shall have the meaning specified in Section  4.10(a).  





 






10    “Valuation Period” shall have the meaning specified in Section 4.07(c).  “Wholly Owned Subsidiary” means, with respect to any Person, any Subsidiary  of such Person, except that, solely for purposes of this definition, the reference to “more  than 50%” in the definition of “Subsidiary” shall be deemed replaced by a reference to  “100%”.  ARTICLE 2  ISSUE, DESCRIPTION AND EXECUTION  Section 2.01. Maturity Date.  Subject to Section 6.02, all outstanding principal  and accrued and unpaid interest on this Note shall be due and payable, in full, on  November 4, 2024 (the “Maturity Date”), unless earlier repurchased, redeemed or  converted pursuant to the terms hereof.  Section 2.02. Interest.  This Note shall bear interest daily at the simple, non- compounding rate equal to the Interest Rate on such day on the unpaid principal amount  of this Note from the Issue Date, or from the most recent date to which interest had been  paid or provided for to, but excluding, the next scheduled Interest Payment Date until the  Maturity Date. Interest is payable semiannually in arrears on each Interest Payment Date.  Interest on this Note shall be computed on the basis of a 360-day year comprised of  twelve 30-day months. Interest shall be paid by wire transfer of immediately available  funds to an account designated by the Holder. In the event that any amounts payable  under this Note are not paid when due, interest shall accrue on all such amounts, in  accordance with Section 3.01(a), including any unpaid principal or interest from the date  such overdue amounts were originally due to the date payment of such amounts has been  made or duly provided for. All such interest shall be payable on demand.  Section 2.03. Payment of Note.  All payments due under this Note shall be paid  in lawful money of the United States. All payments shall be made by wire transfer of  immediately available funds to an account designated in writing by the Holder. If an  interest, principal or other payment date is other than a Business Day (as defined herein),  such payment shall be made on the next succeeding Business Day. All payments shall be  applied first, to all fees, charges and expenses permitted under this Note, second, to all  accrued and unpaid interest hereon and third, to principal.  Section 2.04. Cancellation of Portion of Note Paid.  All portions of this Note  surrendered for the purpose of payment, repurchase, redemption, conversion or  registration of transfer, shall, if surrendered to the Borrower, be promptly canceled by it.  ARTICLE 3  PARTICULAR COVENANTS OF THE BORROWER  Section 3.01. Payment of Principal and Interest.  (a) The Borrower shall promptly make all payments in respect of this Note on  the dates and in the manner provided in this Note. The Borrower shall, to the fullest  





 






11    extent permitted by law, pay interest in immediately available funds on any overdue  principal amount and interest at the annual rate borne by this Note compounded  semiannually, which interest shall accrue from the date such overdue amount was  originally due to the date payment of such amount, including interest thereon, has been  made or duly provided for. All such interest shall be payable on demand. Presentation of  this Note is due at maturity.  (b) Payment of the principal of and interest, if any, on this Note shall be made  in such immediately available coin or currency of the United States as at the time of  payment is legal tender for payment of public and private debts by wire transfer payable  in such money.  Section 3.02. Corporate Existence. Subject to Article 7 hereof, the Borrower  shall do or cause to be done all things necessary to preserve and keep in full force and  effect its corporate existence and rights (charter and statutory); provided, however, that  the Borrower shall not be required to preserve any such right or franchise if the Borrower  determines that the preservation thereof is no longer desirable in the conduct of the  business of the Borrower and that the loss thereof is not disadvantageous in any material  respect to the Holder.  Section 3.03. No Liens. The Borrower and each Guarantor shall not, and each  shall not permit any of their respective Subsidiaries to, directly or indirectly, create,  incur, assume or permit to exist any Lien, other than Permitted Liens, upon any of their  respective property or assets, whether now owned or hereafter acquired.  Section 3.04. Additional Guarantors.  After the Issue Date, the Borrower shall  cause each of the Borrower’s Wholly Owned Subsidiaries (other than any Foreign  Subsidiary or Subsidiary of a Foreign Subsidiary) to, within 30 days of becoming a  Wholly Owned Subsidiary of the Borrower, execute and deliver to the Holder a joinder to  this Note pursuant to which such Subsidiary shall become a Guarantor hereunder.  Section 3.05. Rule 144 Information Requirement and Annual Reports.    (a) The Borrower, at all times while it shall be a reporting company under the  Exchange Act, covenants to file timely (or obtain extensions in respect thereof and file  within the applicable grace period) all reports required to be filed by the Borrower after  the Issue Date pursuant to Sections 13(a) or 15(d) of the Exchange Act and to promptly  furnish the Holder with true and complete copies of all such filings; provided that any  documents publicly filed or furnished with the Commission pursuant to the Electronic  Data Gathering, Analysis and Retrieval System shall be deemed to have been furnished  or delivered to the Holder pursuant to this Section 3.05(a). The Borrower further  covenants that it shall take such further action as the Holder may reasonably request, all  to the extent required from time to time to enable the Holder to resell or otherwise  dispose of this Note or shares of Common Stock issuable upon conversion hereof without  registration under the Securities Act within the limitation of the exemptions provided by  Rule 144, including providing any customary legal opinions. Upon the request of the  





 






12    Holder, the Borrower shall deliver to the Holder a written certification of a duly  authorized officer as to whether it has complied with such requirements.  (b) Without limiting the generality of Section 3.05(a), at any time the Borrower  is not subject to Section 13 or 15(d) of the Exchange Act, the Borrower shall, so long as  this Note or any shares of Common Stock issuable upon conversion thereof shall, at such  time, constitute “restricted securities” within the meaning of Rule 144(a)(3) under the  Securities Act, make publicly available the information concerning the Borrower as  described in Rule 144(c)(2) under the Securities Act to facilitate the resale of this Note or  shares of Common Stock issuable upon conversion thereof pursuant to Rule 144.    (c) The Borrower shall deliver to the Holder, within 15 days after the same are  required to be filed with the Commission, copies of any documents or reports that the  Borrower is required to file with the Commission pursuant to Section 13 or 15(d) of the  Exchange Act (giving effect to any grace period provided by Rule 12b-25 under the  Exchange Act).  Any such document or report that the Borrower files with the  Commission via the Commission’s EDGAR system shall be deemed to be delivered to  the Holder for purposes of this Section 3.05(c) at the time such documents are filed via  the EDGAR system.  Section 3.06. Transfers.  In case this Note or any portion hereof shall be  transferred by the Holder, with delivery of a duly completed Form of Assignment and  Transfer by the Holder to the Borrower, the Borrower shall promptly upon written  request (and in any event, within two Business Days) execute and deliver to (a) the  Holder a new Note in authorized denominations in an aggregate principal amount equal  to the portion of this Note not transferred and (b) each such transferee a new Note in  authorized denominations in an aggregate principal amount equal to the portion of this  Note so transferred to such transferee, without payment of any service charge by the  Holder or any such transferee but, if required by the Borrower, with payment of a sum  sufficient to cover any documentary, stamp or similar issue or transfer tax or similar  governmental charge required by law or that may be imposed in connection therewith as  a result of the name of the Holder of the new Note being different from the name of the  Holder of the old Note.  ARTICLE 4  CONVERSION OF NOTE  Section 4.01. Conversion Privilege at Fixed Conversion Rate.  (a) Subject to and upon compliance with the provisions of this Article 4, the  Holder shall have the right, at the Holder’s option, to convert all or any portion (if the  portion to be converted is $1,000 principal amount or a multiple thereof) of this Note (i)  subject to satisfaction of the conditions described in Section 4.01(b), at any time prior to  the close of business on the Business Day immediately preceding October 15, 2024 under  the circumstances and during the periods set forth in Section 4.01(b), and (ii) regardless  of the conditions described in Section 4.01(b), on or after October 15, 2024 and prior to  the close of business on the Business Day immediately preceding the Maturity Date, in  





 






13    each case, at an initial conversion rate of 345.5425 shares of Common Stock (subject to  adjustment as provided in this Article 4, the “Fixed Conversion Rate”) per $1,000  principal amount of this Note (subject to, and in accordance with, the settlement  provisions of Section 4.03, the “Fixed Conversion Obligation”).  (b)   (i) If (A) a transaction or event that constitutes a Fundamental Change  occurs prior to the Maturity Date or (B) the Borrower is a party to a Merger Event  that occurs prior to the Maturity Date, all or any portion of this Note may be  surrendered for conversion pursuant to Section 4.01(a) at any time from or after  the date that is 35 Business Days prior to the anticipated effective date of the  transaction (or, if later, the earlier of (x) the Business Day after the Borrower  gives notice of such transaction and (y) the actual effective date of such  transaction) until 35 Trading Days after the actual effective date of such  transaction or, if such transaction also constitutes a Fundamental Change, until the  related Fundamental Change Repurchase Date.  The Borrower shall notify the  Holder (x) as promptly as practicable following the date the Borrower publicly  announces such transaction but in no event less than 35 Business Days prior to the  anticipated effective date of such transaction or (y) if the Borrower does not have  knowledge of such transaction at least 35 Business Days prior to the anticipated  effective date of such transaction, within one Business Day of the date upon  which the Borrower receives notice, or otherwise becomes aware, of such  transaction, but in no event later than the actual effective date of such transaction.  (ii) If the Borrower calls any or all of this Note for redemption  pursuant to Article 10 prior to the Maturity Date, then the Holder may surrender  all or any portion of this Note for conversion pursuant to Section 4.01(a) at any  time prior to the close of business on the Business Day prior to the Redemption  Date.  After that time, the right to convert on account of the Borrower’s delivery  of the relevant Redemption Notice shall expire, unless the Borrower defaults in  the payment of the Redemption Price, in which case the Holder may convert all or  any portion of this Note until the Redemption Price has been paid or duly  provided for.  (iii) If, prior to the earliest to occur of the Maturity Date, any  Fundamental Change Effective Date and the effective date of any Merger Event,  the Borrower proposes to consummate a transaction or event that constitutes a  Qualified Financing (including, for the avoidance of doubt, any deemed Qualified  Financing at the election of the Holder) and if the limitations set forth in Section  4.03(g) relating to the Conversion Cap would apply upon conversion of this Note  pursuant to Section 4.02(a) as a result of Section 4.03(g) (as determined by the  Holder in good faith), then the Holder may surrender all or any portion of this  Note for conversion pursuant to Section 4.01(a) at any time from or after the date  of the Borrower’s delivery of any related notice pursuant to Section 4.02(b) on the  basis of which the Holder’s determination that the Conversion Cap may apply is  made, until the close of business on the Business Day prior to the related  





 






14    Financing Closing Date. For the avoidance of doubt, if the Holder delivers a  Notice of Conversion pursuant to this Section 4.01(b)(iii), the provisions of  Section 4.02(a) shall not apply.  Notwithstanding anything to the contrary in this Section 4.01, the Holder agrees  not to convert any portion of the Note pursuant to Section 4.01(a) in the 20  Trading Days after the Borrower provides to the Holder written notice of its good  faith intention to pursue a transaction that the Borrower believes would constitute  a Qualified Financing and for which the Holder determines in good faith that the  Conversion Cap would not apply upon conversion of this Note pursuant to  Section 4.02(a).  Section 4.02. Conversions upon a Qualified Financing or a Non-Qualified  Financing.  (a) If, prior to the earliest to occur of the Maturity Date, any Fundamental  Change Effective Date and the effective date of any Merger Event, the Borrower  consummates a transaction or event that constitutes a Qualified Financing, then, on the  Financing Closing Date in respect of such Qualified Financing this Note shall  automatically convert in whole (or, in respect of a Qualified Financing pursuant to clause  (b) of the definition thereof, in the portion validly set forth in the Holder’s election with  respect to the relevant Non-Qualified Financing) without any further action by the Holder  into Qualified Securities in respect of such Qualified Financing at the Financing  Conversion Rate of such Qualified Securities per $1,000 principal amount of this Note.  (b) The Borrower shall deliver to the Holder written notice of any potential  Qualified Financing or Non-Qualified Financing no less than five (5) Business Days prior  to the related Financing Closing Date.  Such notice shall include a copy of the Qualified  Financing transaction documents, the proposed terms and conditions of the Qualified  Financing, including the nature and type of the Qualified Securities and the proposed  purchase price (or range of purchase prices) with respect thereto, and the proposed  Financing Closing Date. As promptly as practicable after the final determination of the  terms of any Qualified Financing or Non-Qualified Financing, the Borrower shall deliver  to the Holder written notice of the same, notifying the Holder of the Qualified Financing  (or the Non-Qualified Financing, as applicable) and any conversion to be effected,  specifying the Financing Conversion Rate, the date on which such conversion is expected  to occur and calling upon the Holder to surrender to the Borrower, in the manner and at  the place designated herein, this Note.  Section 4.03. Conversion Procedure; Settlement upon Conversion.  (a) Conversions Pursuant to Section 4.01.  (i) Subject to this Section 4.03 and Section 4.10, upon conversion of  this Note pursuant to Section 4.01, the Borrower shall deliver to the Holder, in  respect of each $1,000 principal amount of this Note being converted, a number  of shares of Common Stock equal to the Fixed Conversion Rate, together with  





 






15    cash, if applicable, in lieu of delivering any fractional share of Common Stock in  accordance with Section 4.04, on the second Business Day immediately following  the relevant Fixed Conversion Date. This Note shall be deemed to have been  converted immediately prior to the close of business on the date that the Holder  has complied with the requirements set forth in Section 4.03(a)(ii) (a “Fixed  Conversion Date”). If any shares of Common Stock are due to the Holder  pursuant to this Section 4.03(a), the Borrower shall issue or cause to be issued,  and deliver to the Holder certificates with restrictive legend (or book-entry with  restricted security notation on the books of the Borrower’s transfer agent, as  applicable) for the full number of shares of Common Stock to which the Holder  shall be entitled in satisfaction of the Borrower’s Fixed Conversion Obligation.  The Person in whose name the certificate with restrictive legend (or book-entry  with restricted security notation on the books of the Borrower’s transfer agent, if  applicable) for any shares of Common Stock delivered upon conversion pursuant  to this Section 4.03(a) is registered shall be treated as a shareholder of record as of  the close of business on the relevant Fixed Conversion Date.  (ii) Subject to Section 4.05, before the Holder shall be entitled to  convert this Note pursuant to Section 4.01, the Holder shall (1) complete,  manually sign and deliver an irrevocable notice to the Borrower as set forth in the  Form of Notice of Conversion (or a facsimile thereof) (a “Notice of Conversion”)  to the Borrower and state in writing therein the principal amount of this Note to  be converted and the name or names (with addresses) in which the Holder wishes  the certificate or certificates with restrictive legend (or book-entry with restricted  security notation on the books of the Borrower’s transfer agent) for any shares of  Common Stock to be delivered upon settlement of the Fixed Conversion  Obligation to be registered, (2) surrender this Note, duly endorsed to the Borrower  or in blank (and accompanied by appropriate endorsement and transfer  documents), to the Borrower, and (3) if required, furnish appropriate  endorsements and transfer documents. No Notice of Conversion with respect to  this Note may be surrendered by the Holder if the Holder has also delivered a  Fundamental Change Repurchase Notice to the Borrower in respect of this Note  and has not validly withdrawn such Fundamental Change Repurchase Notice.  (b) Conversions Pursuant to Section 4.02. Upon conversion of this Note  pursuant to Section 4.02(a), the Borrower shall deliver to the Holder, in respect of each  $1,000 principal amount of this Note being converted, a number of shares, units or notes,  as applicable of Qualified Securities equal to the Financing Conversion Rate, together  with cash, if applicable, in lieu of delivering any fractional share, unit or note in  accordance with Section 4.04. The Holder hereby agrees to execute and deliver to the  Borrower all transaction documents entered into by other purchasers participating in the  relevant Qualified Financing, including any purchase agreement, any investor rights  agreement and other ancillary agreements, with representations and warranties and  transfer restrictions substantially similar to those provided by the investors in such  Qualified Financing. The Holder also agrees to deliver the original of this Note (or a  notice to the effect that the original Note has been lost, stolen or destroyed and an  agreement acceptable to the Borrower whereby the Holder agrees to indemnify the  





 






16    Borrower from any loss incurred by it in connection with this Note) on or promptly  following the relevant Financing Closing Date. The Borrower shall, as soon as  practicable thereafter (but in any event with five Business Days of the closing of the  Qualified Financing), issue and deliver to the Holder a certificate or certificates (or a  notice of issuance of uncertificated shares, units or notes, if applicable) for the applicable  number of shares, units or notes, principal amount or liquidation preference, as  applicable, of the Qualified Securities, in substantially the same form and manner as such  Qualified Securities are delivered to investors in the applicable Qualified Financing  together with cash, if applicable, in lieu of delivering any fractional share, unit or note in  accordance with Section 4.04 (the “Financing Conversion Obligation”). Any  conversion of this Note pursuant to Section 4.02(a) shall be deemed to have been made  immediately prior to the closing of the Qualified Financing (such date of closing, the  “Financing Conversion Date”) and on and after such Financing Conversion Date the  Persons entitled to receive the Qualified Securities issuable upon such conversion shall be  treated for all purposes as the record holder of such Qualified Securities.   (c) In case this Note shall be subject to any partial conversion, the Borrower  shall execute and deliver to the Holder a new Note in authorized denominations in an  aggregate principal amount equal to the unconverted portion of this Note, without  payment of any service charge by the Holder but, if required by the Borrower, with  payment of a sum sufficient to cover any documentary, stamp or similar issue or transfer  tax or similar governmental charge required by law or that may be imposed in connection  therewith as a result of the name of the Holder of the new Note issued upon such  conversion being different from the name of the Holder of the old Note surrendered for  such conversion.  (d) Except as provided in Section 4.07, no adjustment shall be made for  dividends on any shares of Common Stock issued upon the conversion of this Note as  provided in this Article 4.  (e) Provisions of this Note that apply to conversion of this entire Note also  apply to conversion of a portion of this Note.  (f) Any Conversion Obligation with respect to this Note shall be computed on  the basis of the aggregate principal amount of this Note (or specified portions thereof to  the extent permitted thereby) so converted.  (g) Notwithstanding anything to the contrary in this Note, the Borrower shall  not issue any shares of Common Stock or other Qualified Securities upon conversion of  this Note pursuant to Section 4.01 or Section 4.02 if the issuance of such Common Stock  or other Qualified Securities, together with any securities issued in connection with any  other related transactions that may be considered part of the same series of transactions  for purposes of the rules of Nasdaq Stock Market LLC, would exceed the aggregate  number of shares of Common Stock or shares, units or notes, as applicable, of other  Qualified Securities that the Borrower may issue in a transaction in compliance with the  Borrower’s obligations under the rules or regulations of Nasdaq Stock Market LLC (such  aggregate number of shares, units or notes, as applicable, the “Conversion Cap”), except  





 






17    that such limitation shall not apply if the Borrower’s stockholders have approved  issuances in excess of the Conversion Cap in accordance with the rules of Nasdaq Stock  Market LLC.  (h) Upon any conversion, simultaneously with the Borrower’s settlement of the  applicable Conversion Obligation, the Borrower shall pay to the Holder a cash payment  representing accrued and unpaid interest, if any, to, but excluding, the relevant  Conversion Date.  Section 4.04. Fractional Shares. The Borrower shall not issue any fractional  share of Common Stock or any fractional share, unit or note of Qualified Securities upon  conversion of this Note and shall instead pay cash in lieu of delivering any fractional  share of Common Stock or any fractional share, unit or note of Qualified Securities  issuable upon conversion based on the Last Reported Sale Price on the relevant Fixed  Conversion Date (in the case of Common Stock deliverable in respect of any Fixed  Conversion Obligation) or the purchase price of each share, unit or note of Qualified  Securities paid by the investors in the relevant Qualified Financing (in the case of  Qualified Securities deliverable in respect of any Financing Conversion Obligation).   Section 4.05. Taxes on Conversion. Except as provided in the next sentence, the  Borrower shall pay any and all documentary, stamp or similar issue or transfer tax due  and duties on the issuance of Common Stock or Qualified Securities upon conversion of  this Note pursuant hereto. The Holder shall be liable for and shall be required to pay any  tax or duty which may be payable in respect of any transfer involved in the issue and  delivery of Common Stock or Qualified Securities in a name other than that of the  Holder, and no such issue or delivery shall be made unless the Person requesting such  issue has paid to the Borrower the amount of any such tax or duty, or has established to  the satisfaction of the Borrower that such tax or duty has been paid.  Section 4.06. Certain Covenants. (a) The Borrower covenants that all shares of  Common Stock or other Qualified Securities issued upon conversion of this Note shall be  (as applicable) newly issued, duly authorized, validly issued, fully paid and non- assessable, enforceable against the Borrower in accordance with their terms, and shall be  free from preemptive or similar rights and free from all taxes, liens and charges with  respect to the issue thereof.  (b) The Borrower covenants that, if any shares of Common Stock or other  Qualified Securities to be provided for the purpose of conversion of this Note require  registration with or approval of any governmental authority under any federal or state law  before such shares of Common Stock or Qualified Securities may be validly issued upon  conversion, the Borrower shall, to the extent then permitted by the rules and  interpretations of the Commission, secure such registration or approval, as the case may  be.  (c) The Borrower further covenants that if at any time the Common Stock or  other Qualified Securities shall be listed on any national securities exchange or automated  quotation system the Borrower will use reasonable best efforts to list and keep listed, so  





 






18    long as the Common Stock or such other Qualified Securities shall be so listed on such  exchange or automated quotation system, any Common Stock or Qualified Securities  issuable upon conversion of this Note.  (d) The Borrower shall reserve, free from preemptive rights, out of its  authorized but unissued shares or shares held in treasury, sufficient shares of Common  Stock to provide for conversion of this Note pursuant to Section 4.01 from time to time as  this Note is presented for conversion.  Section 4.07. Adjustment of Conversion Rate. The Fixed Conversion Rate shall  be adjusted from time to time by the Borrower if any of the following events occurs,  except that the Borrower shall not make any adjustments to the Fixed Conversion Rate if  the Holder participates (other than in the case of (x) a share split or share combination or  (y) a tender or exchange offer), at the same time and upon the same terms as holders of  the Common Stock and solely as a result of holding this Note, in any of the transactions  described in this Section 4.07, without having to convert this Note, as if it held a number  of shares of Common Stock equal to the Fixed Conversion Rate, multiplied by the  principal amount (expressed in thousands) of this Note held by the Holder.  (a) If the Borrower issues shares of Common Stock as a dividend or  distribution on shares of Common Stock, or effects a share split or share combination of  its Common Stock, the Fixed Conversion Rate shall be adjusted based on the following  formula:  CCCC1 = CCCC0 × OOOO1 OOOO0   where,  CR0 = the Fixed Conversion Rate in effect immediately prior to the close of  business on the Record Date for such dividend or distribution or  immediately prior to the open of business on the effective date of such  share split or share combination, as the case may be;  CR1 = the Fixed Conversion Rate in effect immediately after the close of business  on the Record Date for such dividend or distribution or immediately after  the open of business on the effective date of such share split or share  combination, as the case may be;  OS0 = the number of shares of Common Stock outstanding immediately prior to  the close of business on the Record Date for such dividend or distribution  or immediately prior to the open of business on the effective date of such  share split or share combination, as the case may be (before giving effect  to any such dividend, distribution, split or combination); and  OS1 = the number of shares of Common Stock outstanding immediately after  giving effect to such dividend, distribution, share split or share  combination, as the case may be.  





 






19    Any adjustments made pursuant to this Section 4.07(a) shall become effective  immediately after (x) the close of business on the Record Date for such dividend or  distribution or (y) the open of business on the effective date of such split or combination,  as applicable. If any dividend or distribution described in this Section 4.07(a) is declared  but not so paid or made, effective as of the date the Board of Directors determines not to  pay such dividend or distribution, the new Fixed Conversion Rate shall again be adjusted  to the Fixed Conversion Rate that would then be in effect if such dividend or distribution  had not been declared.  (b) If the Borrower distributes to all or substantially all holders of Common  Stock any rights, options or warrants entitling them to purchase, for a period of not more  than 45 days after the announcement date for the distribution, shares of Common Stock at  a price per share less than the average of the Last Reported Sale Prices of the Common  Stock for the ten consecutive Trading Day period ending on the Trading Day  immediately preceding the announcement date for such distribution, the Fixed  Conversion Rate shall be adjusted based on the following formula:  CCCC1 = CCCC0 × OOOO0 + XX OOOO0 + YY   where,  CR0 = the Fixed Conversion Rate in effect immediately prior to the close of  business on the Record Date for such distribution;  CR1 = the Fixed Conversion Rate in effect immediately after the close of  business on the Record Date for such distribution;  OS0 = the number of shares of Common Stock outstanding immediately prior to  the close of business on the Record Date for such distribution;  X = the total number of shares of Common Stock issuable pursuant to such  rights, options or warrants; and  Y =  the number of shares of Common Stock equal to the aggregate price  payable to exercise such rights, options or warrants divided by the average  of the Last Reported Sale Prices of the Common Stock over the ten  consecutive Trading Day period ending on, and including, the Trading  Day immediately preceding the announcement date for such distribution.  For purposes of this Section 4.07(b), in determining whether any rights, options or  warrants entitle the Holder to subscribe for or purchase shares of Common Stock at less  than the average of the Last Reported Sale Prices of the Common Stock for the applicable  ten consecutive Trading Day period, there shall be taken into account any consideration  received by the Borrower for such rights, options or warrants and any amount payable on  exercise thereof, with the value of such consideration if other than cash, to be determined  by the Board of Directors.  





 






20    Any adjustment made pursuant to this Section 4.07(b) shall be made successively  whenever any such rights, options or warrants are distributed and shall become effective  immediately after the close of business on the Record Date for such distribution. To the  extent that shares of Common Stock are not delivered after the expiration of such rights,  options or warrants, the Fixed Conversion Rate shall be decreased to the Fixed  Conversion Rate that would then be in effect had the increase with respect to the issuance  of such rights, options or warrants been made on the basis of delivery of only the number  of shares of Common Stock actually delivered. If such rights, options or warrants are not  so distributed, the Fixed Conversion Rate shall be decreased to the Fixed Conversion  Rate that would then be in effect if the Record Date for such distribution had not  occurred.  (c) If the Borrower distributes shares of its Capital Stock, evidences of its  indebtedness or other assets or property of the Borrower or rights, options or warrants to  acquire its Capital Stock or other securities, to all or substantially all holders of the  Common Stock, excluding (i) dividends, distributions or issuances as to which an  adjustment is effected in Section 4.07(a) or Section 4.07(b), (ii) dividends or distributions  paid exclusively in cash, as to which the provisions of Section 4.07(d) shall apply, (iii)  dividends or distributions that constitute Reference Property following an event described  in Section 4.10 and (iv) Spin-Offs to which the provisions set forth below in this Section  4.07(c) shall apply (any of such shares of Capital Stock, evidences of indebtedness, other  assets or property or rights, options or warrants to acquire Capital Stock or other  securities, the “Distributed Property”), then the Fixed Conversion Rate shall be  adjusted based on the following formula:  CCCC1 = CCCC0 × OOSS0 OOSS0 − FFFFFF   where,  CR0 = the Fixed Conversion Rate in effect immediately prior to the close of  business on the Record Date for such distribution;  CR1 = the Fixed Conversion Rate in effect immediately after the close of  business on the Record Date for such distribution;   SP0 = the average of the Last Reported Sale Prices of the Common Stock over the  ten consecutive Trading Day period ending on, and including, the Trading  Day immediately preceding the Ex-Dividend Date for such distribution;  and  FMV = the fair market value (as determined in good faith by the Board of  Directors) of Distributed Property with respect to each outstanding share  of Common Stock as of the close of business on the Record Date for such  distribution.  Any adjustment made under the portion of this Section 4.07(c) above shall  become effective immediately after the close of business on the Record Date for such  





 






21    distribution. If such distribution is not so paid or made, the Fixed Conversion Rate shall  be decreased to the Fixed Conversion Rate that would then be in effect if such dividend  or distribution had not been declared.  Notwithstanding the foregoing, if “FMV” as set forth above is equal to or greater  than “SP0” as set forth above, in lieu of the foregoing adjustment, the Holder shall  receive, in respect of each $1,000 principal amount of this Note, at the same time and  upon the same terms as holders of Common Stock receive the Distributed Property, the  amount and kind of Distributed Property the Holder would have received if the Holder  owned a number of shares of Common Stock equal to the Fixed Conversion Rate in  effect immediately prior to the close of business on the Record Date for the distribution.  If the Board of Directors determines the “FMV” as set forth above of any distribution for  purposes of this Section 4.07(c) by reference to the actual or when-issued trading market  for any securities, it shall in doing so consider the prices in such market over the same  period used in computing the Last Reported Sale Prices of the Common Stock over the  ten consecutive Trading Day period ending on, and including, the Trading Day  immediately preceding the Ex-Dividend Date for such distribution.    With respect to an adjustment pursuant to this Section 4.07(c) where there has  been a payment of a dividend or other distribution on the Common Stock of shares of the  Capital Stock of any class or series, or similar equity interest, of or relating to a  Subsidiary or other business unit that are, or, when issued, will be, listed or admitted for  trading on a U.S. national securities exchange (a “Spin-Off”), the Fixed Conversion Rate  shall instead be adjusted based on the following formula:  CCCC1 = CCCC0 × FFFFFF0 + FFSS0 FFSS0   where,  CR0 = the Fixed Conversion Rate in effect immediately prior to the end of the  Valuation Period;   CR1 = the Fixed Conversion Rate in effect immediately after the end of the  Valuation Period;  FMV0 = the average of the Last Reported Sale Prices of the Capital Stock or  similar equity interest distributed to holders of Common Stock applicable  to one share of Common Stock (determined by reference to the definition  of Last Reported Sale Price as set forth in Section 1.01 as if references  therein to Common Stock were to such Capital Stock or similar equity  interest) over the first ten consecutive Trading Day period immediately  after, and including, the Ex-Dividend Date for such Spin-Off (such period,  the “Valuation Period”); and  MP0 = the average of the Last Reported Sale Prices of Common Stock over the  Valuation Period.  





 






22    Such adjustment shall occur at the close of business on the last Trading Day of the  Valuation Period; provided that, for purposes of determining the Fixed Conversion Rate  in respect of any conversion during the Valuation Period, references within the previous  paragraph to “ten” shall be deemed replaced with such lesser number of Trading Days as  have elapsed from, and including, the Ex-Dividend Date of such Spin-Off to, and  including, the Conversion Date. If any such dividend or distribution described in the  preceding paragraph of this Section 4.07(c) is declared but not paid or made, the new  Fixed Conversion Rate shall be readjusted to be the Fixed Conversion Rate that would  then be in effect if such dividend or distribution had not been declared.  For purposes of this Section 4.07(c) (and subject in all respect to Section 4.13),  rights, options or warrants distributed by the Borrower to all holders of its Common  Stock entitling such holders to subscribe for or purchase shares of the Borrower’s Capital  Stock, including Common Stock (either initially or under certain circumstances), which  rights, options or warrants, until the occurrence of a specified event or events (“Trigger  Event”): (i) are deemed to be transferred with such shares of the Common Stock; (ii) are  not exercisable; and (iii) are also issued in respect of future issuances of the Common  Stock, shall be deemed not to have been distributed for purposes of this Section 4.07(c)  (and no adjustment to the Fixed Conversion Rate under this Section 4.07(c) shall be  required) until the occurrence of the earliest Trigger Event, whereupon such rights,  options or warrants shall be deemed to have been distributed and an appropriate  adjustment (if any is required) to the Fixed Conversion Rate shall be made under this  Section 4.07(c). If any such right, option or warrant, including any such existing rights,  options or warrants distributed prior to the date of this Note, are subject to events, upon  the occurrence of which such rights, options or warrants become exercisable to purchase  different securities, evidences of indebtedness or other assets, then the date of the  occurrence of any and each such event shall be deemed to be the date of distribution and  Record Date with respect to new rights, options or warrants with such rights (in which  case the existing rights, options or warrants shall be deemed to terminate and expire on  such date without exercise by any of the holders thereof). In addition, in the event of any  distribution (or deemed distribution) of rights, options or warrants, or any Trigger Event  or other event of the type described in the immediately preceding sentence with respect  thereto that was counted for purposes of calculating a distribution amount for which an  adjustment to the Fixed Conversion Rate under this Section 4.07(c) was made, (1) in the  case of any such rights, options or warrants that shall all have been redeemed or  purchased without exercise by any holders thereof, upon such final redemption or  purchase (x) the Fixed Conversion Rate shall be readjusted as if such rights, options or  warrants had not been issued and (y) the Fixed Conversion Rate shall then again be  readjusted to give effect to such distribution, deemed distribution or Trigger Event, as the  case may be, as though it were a cash distribution, equal to the per share redemption or  purchase price received by a holder or holders of Common Stock with respect to such  rights, options or warrants (assuming such holder had retained such rights, options or  warrants), made to all holders of Common Stock as of the date of such redemption or  purchase, and (2) in the case of such rights, options or warrants that shall have expired or  been terminated without exercise by any holders thereof, the Fixed Conversion Rate shall  be readjusted as if such rights, options and warrants had not been issued.  





 






23    For purposes of Section 4.07(a), Section 4.07(b) and this Section 4.07(c), if any  dividend or distribution to which this Section 4.07(c) is applicable also includes one or  both of:  (A) a dividend or distribution of shares of Common Stock to  which Section 4.07(a) is applicable (the “Clause A Distribution”); or  (B) a dividend or distribution of rights, options or warrants to  which Section 4.07(b) is applicable (the “Clause B Distribution”),  then, in either case, (1) such dividend or distribution, other than the Clause A Distribution  and the Clause B Distribution, shall be deemed to be a dividend or distribution to which  this Section 4.07(c) is applicable (the “Clause C Distribution”) and any Fixed  Conversion Rate adjustment required by this Section 4.07(c) with respect to such Clause  C Distribution shall then be made, and (2) the Clause A Distribution and Clause B  Distribution shall be deemed to immediately follow the Clause C Distribution and any  Fixed Conversion Rate adjustment required by Section 4.07(a) and Section 4.07(b) with  respect thereto shall then be made, except that, if determined by the Borrower (I) the  “Record Date” of the Clause A Distribution and the Clause B Distribution shall be  deemed to be the Record Date of the Clause C Distribution and (II) any shares of  Common Stock included in the Clause A Distribution or Clause B Distribution shall be  deemed not to be “outstanding immediately prior to the close of business on the Record  Date for such dividend or distribution or immediately prior to the open of business on the  effective date of such share split or share combination, as the case may be” within the  meaning of Section 4.07(a) or “outstanding immediately prior to the close of business on  the Record Date for such distribution” within the meaning of Section 4.07(b).  (d) If any cash dividend or cash distribution is made to all or substantially all  holders of Common Stock, the Fixed Conversion Rate shall be adjusted based on the  following formula:  CCCC1 = CCCC0 × OOSS0 OOSS0 − CC   where,  CR0 = the Fixed Conversion Rate in effect immediately prior to the close of  business on the Record Date for such dividend or distribution;  CR1 = the Fixed Conversion Rate in effect immediately after the close of  business on the Record Date for such dividend or distribution;  SP0 = the Last Reported Sale Price of the Common Stock on the Trading Day  immediately preceding the Ex-Dividend Date for such dividend or  distribution; and  C = the amount in cash per share of Common Stock the Borrower distributes to  holders of Common Stock.  





 






24    An adjustment to the Fixed Conversion Rate made pursuant to this Section  4.07(d) shall become effective immediately after the close of business on the Record Date  for the applicable dividend or distribution. If any dividend or distribution described in  this Section 4.07(d) is declared but not so paid or made, the new Fixed Conversion Rate  shall be readjusted, effective as of the date the Board of Directors determines not to make  or pay such dividend or distribution, to the Fixed Conversion Rate that would then be in  effect if such dividend or distribution had not been declared.  Notwithstanding the foregoing, if “C” as set forth above is equal to or greater than  “SP0” as set forth above, in lieu of the foregoing adjustment, the Holder shall receive, for  each $1,000 principal amount of this Note, at the same time and upon the same terms as  holders of shares of Common Stock, the amount of cash that the Holder would have  received if the Holder owned a number of shares of Common Stock equal to the Fixed  Conversion Rate in effect on the Record Date for such cash dividend or distribution.  (e) If the Borrower or any of its Subsidiaries makes a payment in respect of a  tender or exchange offer for Common Stock, to the extent that the cash and value of any  other consideration included in the payment per share of Common Stock exceeds the  average of the Last Reported Sale Prices of the Common Stock over the 10 consecutive  Trading Day period commencing on, and including, the Trading Day next succeeding the  last date on which tenders or exchanges may be made pursuant to such tender or  exchange offer (the “Expiration Date”), the Fixed Conversion Rate shall be adjusted  based on the following formula:  CCCC1 = CCCC0 × AACC + (OOSS1 × OOOO1) OOOO0 × OOSS1   where,  CR0 = the Fixed Conversion Rate in effect immediately prior to the close of  business on the 10th Trading Day immediately following, and including,  the Trading Day next succeeding the Expiration Date;  CR1 = the Fixed Conversion Rate in effect immediately after the close of  business on the 10th Trading Day immediately following, and including,  the Trading Day next succeeding the Expiration Date;  AC = the aggregate value of all cash and any other consideration (as determined  by the Board of Directors) paid or payable for shares of Common Stock  purchased in such tender offer or exchange offer;  OS0 = the number of shares of Common Stock outstanding immediately prior to  time (the “Expiration Time”) such tender or exchange offer expires (prior  to giving effect to the purchase of all shares of Common Stock accepted  for purchase or exchange in such tender offer or exchange offer);  OS1 = the number of shares of Common Stock outstanding immediately after the  Expiration Time (after giving effect to the purchase of all shares of  





 






25    Common Stock accepted for purchase or exchange in such tender offer or  exchange offer); and  SP1 = the average of the Last Reported Sale Prices of the Common Stock over  the ten (10) consecutive Trading Day period commencing on, and  including, the Trading Day next succeeding the Expiration Date.  The adjustment to the Fixed Conversion Rate under this Section 4.07(e) shall  become effective immediately following the close of business on the 10th Trading Day  immediately following, and including, the Trading Day next succeeding the Expiration  Date; provided that in respect of any conversion of this Note, if the relevant Conversion  Date occurs during the 10 Trading Days immediately following, and including, the  Trading Day next succeeding the Expiration Date, references to “10” or “10th” in the  preceding paragraph shall be deemed replaced with such lesser number of Trading Days  as have elapsed from, and including, the Trading Day next succeeding the Expiration  Date to, and including, the Conversion Date in determining the Fixed Conversion Rate.   (f) For purposes of this Section 4.07, the number of shares of Common Stock  at any time outstanding shall not include shares of Common Stock held in the treasury of  the Borrower so long as the Borrower does not pay any dividend or make any distribution  on shares of Common Stock held in the treasury of the Borrower, but shall include shares  of Common Stock issuable in respect of scrip certificates issued in lieu of fractions of  shares of Common Stock.  (g) All calculations under this Article 4 shall be made to the nearest cent or to  the nearest 1/10,000th of a share, unit or note.  (h) If the application of the foregoing formulas in Section 4.07 would result in a  decrease in the Fixed Conversion Rate, no adjustment to the Fixed Conversion Rate shall  be made (except on account of share combinations).  (i) Notwithstanding anything to the contrary in this Section 4.07, the Fixed  Conversion Rate shall not be adjusted:  (i) upon the issuance of any shares of Common Stock pursuant to any  present or future plan providing for the reinvestment of dividends or interest  payable on securities of the Borrower and the investment of additional optional  amounts in shares of Common Stock under any plan;  (ii) upon the issuance of any shares of Common Stock or options or  rights to purchase shares of Common Stock pursuant to any present or future  employee, director or consultant benefit plan or program or employee stock  purchase plan of, or assumed by, the Borrower or any of its Subsidiaries;  (iii) upon the issuance of any shares of Common Stock pursuant to any  option, warrant, right, or exercisable, exchangeable or convertible security not  described in clause (ii) above and outstanding as of the Issue Date;  





 






26    (iv) upon the issuance of Rights under a Rights Plan unless, prior to  conversion, the Rights issued under such Rights Plan have separated from the  Common Stock;  (v) for a change in the par value of the Common Stock;   (vi) for accrued and unpaid interest; or  (vii) solely on account of the purchase price, exchange price or  conversion price in any Qualified Financing or Non-Qualified Financing being  less than $1,000 divided by the Fixed Conversion Rate.   Section 4.08. Notice of Adjustment. Whenever the Fixed Conversion Rate is  required to be adjusted pursuant to this Note, the Borrower shall promptly deliver to the  Holder a notice of the adjustment, briefly stating the facts requiring the adjustment, the  adjusted Fixed Conversion Rate and the manner of computing it. Failure to deliver such  notice or any defect therein shall not affect the validity of any such adjustment.  Section 4.09. Notice of Certain Transactions. In the event that there is a  dissolution or liquidation of the Borrower, the Borrower shall deliver to the Holder and  provide to the Holder a written notice stating the proposed effective date. The Borrower  shall deliver such notice at least 20 days before such proposed effective date. Failure to  deliver such notice or any defect therein shall not affect the validity of any transaction  referred to in this Section 4.09.  Section 4.10. Effect of Reclassification, Consolidation, Merger or Sale On  Conversion Privilege.  (a) If any of the following events occur:  (i) any recapitalization, reclassification or change of the outstanding  shares of Common Stock (other than changes resulting from a subdivision or  combination);  (ii) any consolidation, merger, combination or similar transaction  involving the Borrower;  (iii) any sale, conveyance, lease or other transfer to any third party of  all or substantially all of the consolidated property and assets of the Borrower and  its Subsidiaries; or  (iv) any statutory share exchange,  in each case, as a result of which the Common Stock would be converted into, or  exchanged for, stock, other securities, other property or assets (including cash or any  combination thereof) (any such event, a “Merger Event”), then, at and after the effective  time of such Merger Event, the right of the Holder to convert each $1,000 principal  amount of this Note pursuant to Section 4.01(a) shall be changed into a right of the  





 






27    Holder to convert such principal amount of this Note into the kind and amount of shares  of stock, other securities or other property or assets (including cash or any combination  thereof) that a holder of a number of shares of Common Stock equal to the Fixed  Conversion Rate immediately prior to such Merger Event would have owned or been  entitled to receive (the “Reference Property,” with each “unit of Reference Property”  meaning the kind and amount of Reference Property that a holder of one share of  Common Stock is entitled to receive) upon such Merger Event and, prior to or at the  effective time of such Merger Event, this Note shall be deemed to provide for such  change in the convertibility of this Note, including anti-dilution and other adjustments  that shall be as nearly equivalent as is possible to the adjustments provided for in this  Article 4, and the Borrower or the successor or purchasing Person, as the case may be,  shall execute a supplement to this Note at such time to evidence the foregoing; provided,  however, that at and after the effective time of the Merger Event the number of shares of  Common Stock otherwise deliverable upon conversion of this Note pursuant to Section  4.03(a) shall instead be deliverable in the amount and type of Reference Property that a  holder of that number of shares of Common Stock would have received in such Merger  Event.  If the Merger Event causes the Common Stock to be converted into, or exchanged  for, the right to receive more than a single type of consideration (determined based in part  upon any form of shareholder election), then (i) the Reference Property into which this  Note will be convertible shall be deemed to be the weighted average of the types and  amounts of consideration actually received by the holders of Common Stock and (ii) the  unit of Reference Property for purposes of the immediately preceding paragraph shall  refer to the consideration referred to in clause (i) attributable to one share of Common  Stock. If the holders of the Common Stock receive only cash in such Merger Event, then  for all conversions pursuant to Section 4.01(a) for which the relevant Fixed Conversion  Date occurs after the effective date of such Merger Event (A) the consideration due upon  conversion of each $1,000 principal amount of this Note shall be solely cash in an  amount equal to the Fixed Conversion Rate in effect on the Fixed Conversion Date,  multiplied by the price paid per share of Common Stock in such Merger Event and (B)  the Borrower shall satisfy the Fixed Conversion Obligation by paying cash to the  converting Holder on the second Business Day immediately following the relevant Fixed  Conversion Date. The Borrower shall notify the Holder of such weighted average as soon  as practicable after such determination is made but in no event later than the third (3rd)  Business Day following the effective date of the Merger Event.  If, in the case of any Merger Event, the Reference Property includes shares of  stock, securities or other property or assets (including cash or any combination thereof) of  a Person other than the successor or purchasing corporation, as the case may be, in such  Merger Event, then an assumption of this Note shall also be executed by such other  Person and shall contain such additional provisions to protect the interests of the Holder  as the Board of Directors shall reasonably consider necessary by reason of the foregoing,  including the provisions providing for the purchase rights set forth in Article 9.  (b) When this Note is modified or amended pursuant to subsection (a) of this  Section 4.10, the Borrower shall promptly provide to the Holder a notice briefly stating  





 






28    the reasons therefor, the kind or amount of cash, securities or property or asset that will  comprise a unit of Reference Property after any such Merger Event, any adjustment to be  made with respect thereto and that all conditions precedent have been complied with.  Failure to deliver such notice shall not affect the legality or validity of such modification  or amendment to this Note.  (c) The Borrower shall not become a party to any Merger Event unless its terms  are consistent with this Section 4.10. None of the foregoing provisions shall affect the  right of the Holder to convert this Note into shares of Common Stock pursuant to Section  4.01(a) prior to the effective date of such Merger Event.  (d) The above provisions of this Section 4.10 shall similarly apply to successive  Merger Events.   Section 4.11. Voluntary Increase; Nasdaq Compliance. The Borrower from time  to time may increase the Fixed Conversion Rate, to the extent permitted by law and  subject to any applicable shareholder approval requirements pursuant to the listing  standards of The Nasdaq Global Market or such other United States securities exchange  on which the Common Stock is traded, by any amount for any period of at least 20 days,  if the Board of Directors determines that such increase shall be in the Borrower’s best  interests. The Borrower may (but is not required to) make such increase in the Fixed  Conversion Rate as the Board of Directors deems advisable to avoid or diminish any  income tax to holders of Common Stock resulting from a dividend or distribution of  stock, or rights to acquire stock, or similar event. The Borrower shall provide at least 15  days’ written notice to the Holder of any increase under this Section 4.11, and such notice  shall state the increased Fixed Conversion Rate and the period during which it will be in  effect.  Section 4.12. Adjustments of Prices. Whenever any provision of this Note  requires the Borrower to calculate the Last Reported Sale Prices over a span of multiple  days, the Borrower will make appropriate adjustments to the Last Reported Sale Prices to  account for any adjustment to the Fixed Conversion Rate that becomes effective, or any  event requiring an adjustment to the Fixed Conversion Rate where the Ex-Dividend Date,  Record Date, effective date or expiration date of the event occurs at any time during the  period when the Last Reported Sale Prices are to be calculated. The Borrower will  provide a schedule of its calculations the Holder.  Section 4.13. Rights Plan. To the extent that the Borrower has a Rights Plan in  effect upon conversion of this Note into Common Stock, the Holder shall receive upon  conversion of this Note, the Rights under the Rights Plan, unless prior to conversion, the  Rights have separated from the Common Stock, in which case, and only in such case, the  Fixed Conversion Rate shall be adjusted at the time of separation as if the Borrower  distributed to all or substantially all holders of Common Stock Distributed Property as  described in Section 4.07(c) above, subject to readjustment in the event of the expiration,  termination or redemption of such Rights.  





 






29    ARTICLE 5  INTENTIONALLY OMITTED  ARTICLE 6  DEFAULT AND REMEDIES  Section 6.01. Events of Default. The occurrence of any one or more of the  following events shall constitute an event of default (hereinafter “Event of Default”)  under this Note:  (a) the Borrower fails to pay when due the principal of this Note at the Maturity  Date, upon Optional Redemption, upon exercise of a repurchase right hereunder or  otherwise;  (b) the Borrower fails to pay an installment of interest on this Note for 30 days  or more after the date when due;  (c) the Borrower fails to deliver consideration due in respect of its Conversion  Obligation upon conversion of this Note within the time periods specified in Section  4.03, and such failure continues for a period of three Business Days;  (d) the Borrower fails to provide a Fundamental Change Borrower Notice when  due in accordance with Section 9.01 or a notice pursuant to Section 4.02(b) when due,  and in either case such failure continues for a period of four Business Days;  (e) the Borrower fails to comply with its obligations under Section 7.01;  (f) the Borrower fails to perform or observe any other term, covenant or  agreement contained in this Note for a period of 60 days after written notice of such  failure, requiring the Borrower to remedy the same, shall have been given to the  Borrower by the Holder;  (g) default by the Borrower or any Subsidiary of the Borrower with respect to  any mortgage, agreement or other instrument under which there may be outstanding, or  by which there may be secured or evidenced, any indebtedness for borrowed money in  excess of $1,000,000 in the aggregate of the Borrower and/or any such Subsidiary,  whether such indebtedness now exists or shall hereafter be created (i) resulting in such  indebtedness becoming or being declared due and payable, (ii) constituting a failure to  pay the principal or interest of any such debt when due and payable at its stated maturity,  upon required repurchase, upon declaration of acceleration or otherwise or (iii) otherwise,  which such default is not cured or remedied within the time prescribed by its governing  documents or if no time is prescribed within twenty (20) Business Days;  (h) a final judgment or judgments for the payment of $1,000,000 (or its foreign  currency equivalent) or more (excluding any amounts covered by insurance) in the  aggregate rendered against the Borrower or any Subsidiary of the Borrower, which  judgment is not discharged, bonded, paid, waived or stayed within 60 days after (i) the  





 






30    date on which the right to appeal thereof has expired if no such appeal has commenced,  or (ii) the date on which all rights to appeal have been extinguished;  (i) an involuntary case or other proceeding shall be commenced against the  Borrower, any Guarantor or any Significant Subsidiary (or any group of the Borrower’s  Subsidiaries that, taken together, would constitute a Significant Subsidiary) seeking  liquidation, reorganization or other relief with respect to the Borrower, such Guarantor or  any Significant Subsidiary (or any group of the Borrower’s Subsidiaries that, taken  together, would constitute a Significant Subsidiary) or its debts under any bankruptcy,  insolvency or other similar law now or hereafter in effect or seeking the appointment of a  trustee, receiver, liquidator, custodian or other similar official of the Borrower, such  Guarantor or any Significant Subsidiary (or any group of the Borrower’s Subsidiaries  that, taken together, would constitute a Significant Subsidiary) or any substantial part of  its property, and such involuntary case or other proceeding shall remain undismissed and  unstayed for a period of 30 consecutive days;   (j) the Borrower, any Guarantor or any Significant Subsidiary (or any group of  the Borrower’s Subsidiaries that, taken together, would constitute a Significant  Subsidiary) pursuant to or within the meaning of any Bankruptcy Law:  (i) commences as a debtor a voluntary case or proceeding;  (ii) consents to the entry of an order for relief against it in an  involuntary case or proceeding or the commencement of any case against it;  (iii) consents to the appointment of a Receiver of it or for all or  substantially all of its property;  (iv) makes a general assignment for the benefit of its creditors;  (v) files a petition in bankruptcy or answer or consent seeking  reorganization or relief; or  (vi) consents to the filing of such a petition or the appointment of or  taking possession by a Receiver;   (k) a Termination of Trading shall have occurred; or  (l) except as permitted in this Note, any Guarantee shall be held in any judicial  proceeding to be unenforceable or invalid or shall cease for any reason to be in full force  and effect, or any Guarantor, or any Person acting on its behalf, shall deny or disaffirm its  obligations under its Guarantee.  The term “Bankruptcy Law” means Title 11 of the United States Code (or any  successor thereto) or any similar federal or state law for the relief of debtors. The term  “Receiver” means any receiver, trustee, assignee, liquidator, sequestrator or similar  official under any Bankruptcy Law.  





 






31    Section 6.02. Acceleration of Maturity; Rescission and Annulment. If an Event  of Default with respect to the portion of this Note that is Outstanding (other than an Event  of Default specified in Section 6.01(i) or Section 6.01(j) hereof in respect of the Borrower  or any Guarantor) occurs and is continuing, the Holder may declare the portion of this  Note that is Outstanding due and payable at its principal amount plus any accrued and  unpaid interest, and thereupon the Holder may, at its discretion, proceed to protect and  enforce its rights by the appropriate judicial proceedings. Such declaration may be  rescinded and annulled by the written consent of the Holder.  If an Event of Default specified in Section 6.01(i) or Section 6.01(j) hereof in  respect of the Borrower or any Guarantor occurs and is continuing, then all unpaid  principal of, and accrued and unpaid interest on, the portion of this Note that is  Outstanding shall become immediately due and payable, without any declaration or other  act on the part of the Holder.  The Holder may rescind and annul an acceleration and its consequences if:  (a) all existing Events of Default, other than the nonpayment of principal  (including the Fundamental Change Repurchase Price or the Redemption Price, if  applicable) of or interest on this Note which has become due solely because of the  acceleration, have been remedied, cured or waived; and  (b) the rescission would not conflict with any judgment or decree of a court of  competent jurisdiction;  provided, however, that in the event such declaration of acceleration has been made based  on the existence of an Event of Default under Section 6.01(g) hereof and such Event of  Default has been remedied, cured or waived in accordance with Section 6.01(g) hereof,  then, without any further action by the Holder, such declaration of acceleration shall be  rescinded automatically and the consequences of such declaration shall be annulled. No  such rescission or annulment shall affect any subsequent Default or impair any right  consequent thereon.  Section 6.03. Other Remedies. If an Event of Default with respect to the portion  of this Note that is Outstanding occurs and is continuing, the Holder may pursue any  available remedy by proceeding at law or in equity to collect the payment of principal of,  or interest on, this Note or to enforce the performance of any provision of this Note.  Section 6.04. Waiver of Past Defaults. The Holder may waive an existing  Default or Event of Default. Upon any such waiver, such Default shall cease to exist, and  any Event of Default arising therefrom shall be deemed to have been cured, for every  purpose of this Note; provided, however, that no such waiver shall extend to any  subsequent or other Default or impair any right consequent thereon  Section 6.05. Unconditional Right of Holder to Receive Payment and to Convert.  Notwithstanding any other provision in this Note, the Holder of this Note shall have the  right, which is absolute and unconditional, to receive payment of the principal amount  (including the Fundamental Change Repurchase Price and the Redemption Price, if  





 






32    applicable) and interest in respect of this Note, on or after the respective due dates  expressed in this Note, and to convert this Note in accordance with Article 4, and to bring  suit for the enforcement of any such payment on or after such respective due dates or for  the right to convert in accordance with Article 4, and shall not be impaired or affected  without the consent of the Holder.  Section 6.06. Restoration of Rights and Remedies. If the Holder has instituted  any proceeding to enforce any right or remedy under this Note and such proceeding has  been discontinued or abandoned for any reason, or has been determined adversely to the  Holder, then and in every such case, subject to any determination in such proceeding, the  Borrower and the Holder shall be restored severally and respectively to their former  positions hereunder and thereafter all rights and remedies of the Holder shall continue as  though no such proceeding had been instituted.  Section 6.07. Rights and Remedies Cumulative. Except as otherwise provided  with respect to the replacement or payment of a mutilated, destroyed, lost or stolen Note  in Section 12.13, no right or remedy conferred in this Note upon or reserved to the Holder  of this Note is intended to be exclusive of any other right or remedy, and every right and  remedy shall, to the extent permitted by law, be cumulative and in addition to every other  right and remedy given hereunder or hereafter existing at law or in equity or otherwise.  The assertion or employment of any right or remedy hereunder, or otherwise, shall not  prevent the concurrent assertion or employment of any other appropriate right or remedy.  Section 6.08. Delay or Omission Not Waiver. No delay or omission of the  Holder to exercise any right or remedy accruing upon any Event of Default shall impair  any such right or remedy or constitute a waiver of any such Event of Default or any  acquiescence therein. Every right and remedy given by this Article 6 or by law to the  Holder may be exercised from time to time, and as often as may be deemed expedient, by  the Holder.  Section 6.09. Waiver of Stay or Extension Laws. The Borrower covenants (to the  extent that it may lawfully do so) that it shall not at any time insist upon, or plead, or in  any manner whatsoever claim to take the benefit or advantage of, any stay or extension  law wherever enacted, now or at any time hereafter in force, which may affect the  covenants or the performance of this Note; and the Borrower (to the extent that it may  lawfully do so) hereby expressly waives all benefit or advantage of any such law and  covenants that it shall not hinder, delay or impede the execution of any power herein  granted to the Holder, but shall suffer and permit the execution of every such power as  though no such law had been enacted.  ARTICLE 7  CONSOLIDATIONS; MERGER; CONVEYANCE; TRANSFER OR LEASE  Section 7.01. Consolidations; Merger; Conveyance; Transfer or Lease.  (a) The Borrower may not, without the consent of the Holder, consolidate with,  merge into or convey, transfer or lease all or substantially all of the property and assets of  





 






33    the Borrower and its Subsidiaries, taken as a whole, to another Person (other than a  transfer of all or substantially all of the assets of the Borrower and its Subsidiaries, taken  as a whole, to one or more direct or indirect wholly-owned Subsidiaries) (a “Business  Combination Event”) unless:  (i) the resulting, surviving or transferee Person either (1) is the  Borrower or (2) if not the Borrower, is a Qualified Successor Entity (such  Qualified Successor Entity, the “Successor Entity”) organized and existing under  the laws of the United States of America or any State thereof or the District of  Columbia that expressly assumes, by an assignment and assumption agreement,  executed and delivered to the Holder, in form reasonably satisfactory to the  Holder, the obligations of the Borrower under this Note; and  (ii) at the time of, and after giving effect to, such Business  Combination Event, no Default or Event of Default shall have occurred and be  continuing.  Section 7.02. Successor Substituted. At the effective time of any Business  Combination Event that complies with Section 7.01, the Successor Entity (if not the  Borrower) shall succeed to, and be substituted for, and may exercise every right and  power of, Borrower under this Note with the same effect as if such successor Person had  been named as the Borrower herein, and thereafter, except in the case of a lease, and  except for obligations the predecessor Person may have under an assignment and  assumption agreement, the predecessor Person shall be relieved of all obligations and  covenants under the this Note.  ARTICLE 8  TAX TREATMENT  Section 8.01. Tax Treatment. Each of the Borrower and the Holder agree to treat  this Note as equity for U.S. federal and other applicable income tax purposes and to  perform all tax reporting, withholding and other tax compliance in manner consistent  with such treatment unless otherwise required pursuant to a “determination” within the  meaning of Section 1313(a) of the Code.   ARTICLE 9  REPURCHASE OF NOTE UPON A FUNDAMENTAL CHANGE  Section 9.01. Repurchase of Note at Option of the Holder Upon a Fundamental  Change.  (a) If a Fundamental Change occurs prior to the Maturity Date, the Holder shall  have the right, at the option of the Holder, to require the Borrower to repurchase all or  any portion of this Note at the Fundamental Change Repurchase Price, on the date  specified by the Borrower that is not less than twenty (20) days and not more than thirty- five (35) days after the date of the Fundamental Change Borrower Notice pursuant to  Section 9.01(b) (the “Fundamental Change Repurchase Date”).  The Holder may  





 






34    require the Borrower to repurchase fewer than all of the entire principal amount of this  Note only if the principal amount of this Note to be repurchased is an integral multiple of  $1,000.  (b) Notwithstanding the foregoing, this Note may not be repurchased by the  Borrower on any date at the option of the Holders upon a Fundamental Change if the  principal amount of this Note has been accelerated, and such acceleration has not been  rescinded, on or prior to such date (except in the case of an acceleration resulting from a  Default by the Borrower in the payment of the Fundamental Change Repurchase Price  with respect to this Note).  (c) On or before the 15th day after the Fundamental Change Effective Date, the  Borrower shall deliver a written notice of the occurrence of the Fundamental Change, and  of the repurchase right arising therefrom, to the Holder at the notice address in Section  12.01 (the “Fundamental Change Borrower Notice”). The Fundamental Change  Borrower Notice shall set forth the Holder’s right to require the Borrower to purchase this  Note and specify:  (i) the events causing such Fundamental Change;  (ii) the Fundamental Change Effective Date;  (iii) the last date by which the Fundamental Change Repurchase Notice  must be delivered to elect the repurchase option pursuant to this Section 9.01;  (iv) the Fundamental Change Repurchase Price;  (v) the Fundamental Change Repurchase Date;  (vi) that if a Fundamental Change Repurchase Notice has been  delivered by a Holder, this Note may be converted only if the Holder withdraws  the Fundamental Change Repurchase Notice in accordance with the terms of this  Note; and  (vii) the procedures that the Holder must follow to require the Borrower  to repurchase this Note under this Section 9.01.  No failure of the Borrower to give the foregoing notices or defect therein shall  limit the Holder’s right to exercise its right to cause the Borrower to repurchase this Note  pursuant to this Section 9.01.  (d) Repurchases of the principal of this Note under this Article 9 shall be made  upon delivery to the Borrower by the Holder of a duly completed notice (the  “Fundamental Change Repurchase Notice”) in the form set forth in the Form of  Fundamental Change Repurchase Notice in Attachment 2 to this Note before the close of  business on the Business Day immediately preceding the Fundamental Change  Repurchase Date.  





 






35    Each Fundamental Change Repurchase Notice shall state:  (i) the portion of the principal amount of this Note to be repurchased,  which must be $1,000 or an integral multiple thereof (provided that any portion of  this Note not to be repurchased is in the minimum principal amount of $1,000);  and  (ii) that this Note is to be repurchased by the Borrower pursuant to the  applicable provisions of this Note.  Notwithstanding anything herein to the contrary, the Holder shall have the right to  withdraw, in whole or in part, such Fundamental Change Repurchase Notice at any time  prior to the close of business on the Business Day immediately preceding the  Fundamental Change Repurchase Date by delivery of a written notice of withdrawal to  the Borrower in accordance with Section 9.02.  Section 9.02. Withdrawal of Fundamental Change Repurchase Notice.  (a) A Fundamental Change Repurchase Notice may be withdrawn (in whole or  in part) by means of a written notice of withdrawal delivered to the Borrower in  accordance with this Section 9.02 at any time prior to the close of business on the  Business Day immediately preceding the Fundamental Change Repurchase Date  specifying:  (i) the principal amount of this Note with respect to which such notice  of withdrawal is being submitted; and  (ii) the principal amount, if any, of this Note that remains subject to  the original Fundamental Change Repurchase Notice, which portion must be in  principal amounts of $1,000 or an integral multiple of $1,000 (provided that any  portion of this Note not to be repurchased is in the minimum principal amount of  $1,000).  Section 9.03. Note Repurchased In Part. Upon surrender of the portion of this  Note that is to be repurchased only in part in accordance with Section 9.01, and promptly  after the Fundamental Change Repurchase Date, the Borrower shall execute and deliver  to the Holder, without service charge, a new Note, of such authorized denomination or  denominations as may be requested by the Holder (which must be an integral multiple of  $1,000 and which must be at least $1,000), in aggregate principal amount equal to, and in  exchange for, the portion of the principal amount of this Note so surrendered that is not  repurchased.  Section 9.04. Payment of Fundamental Change Repurchase Price.  The  Borrower shall pay the Fundamental Change Repurchase Price for this Note (or the  applicable portion thereof) surrendered for repurchase (and not validly withdrawn prior to  the close of business on the Business Day immediately preceding the Fundamental  Change Repurchase Date) on the later of (i) the Fundamental Change Repurchase Date  and (ii) the time of the delivery of this Note to the Borrower by the Holder.  





 






36    Section 9.05. Covenant to Comply with Applicable Laws Upon Repurchase of  Note.  In connection with any repurchase offer pursuant to this Article 9, the Borrower  shall, if required:  (a) comply with the provisions of Rule 13e-4, Rule 14e-1 and any other tender  offer rules under the Exchange Act;  (b) file a Schedule TO or any successor or similar schedule; and  (c) otherwise comply with all federal and state securities laws in connection  with any offer by the Borrower to repurchase this Note;  in each case, so as to permit the rights and obligations under this Article 9 to be exercised  in the time and in the manner specified in this Article 9.  ARTICLE 10  REDEMPTION  Section 10.01.   Optional Redemption.  The Borrower may redeem (an “Optional  Redemption”) for cash all or any portion of this Note at the Redemption Price.  Section 10.02.   Notice of Optional Redemption.    (a) In case the Borrower exercises its Optional Redemption right to redeem all  or any part of this Note pursuant to Section 10.01, it shall fix a date for redemption (each,  a “Redemption Date”) and it shall deliver or cause to be delivered a notice of such  Optional Redemption (a “Redemption Notice”) not less than 20 nor more than 60  calendar days prior to the Redemption Date to the Holder.  The Redemption Date must be  a Business Day.  (b) Each Redemption Notice shall specify:  (i) the Redemption Date;  (ii) the Redemption Price;  (iii) that on the Redemption Date, the Redemption Price will become  due and payable upon this Note to be redeemed, and that interest thereon, if any,  shall cease to accrue on and after the Redemption Date;   (iv) that the Holder may surrender this Note for conversion at the Fixed  Conversion Rate at any time prior to the close of business on the Business Day  immediately preceding the Redemption Date;  (v) the procedures the Holder must follow to convert this Note;   (vi) the Fixed Conversion Rate;   





 






37    (vii) in case this Note is to be redeemed in part only, the portion of the  principal amount thereof to be redeemed and on and after the Redemption Date,  upon surrender of this Note, a new Note in principal amount equal to the  unredeemed portion thereof shall be issued.  A Redemption Notice shall be irrevocable.  Section 10.03.   Payment of Redemption Price.  If any Notice of Redemption has  been given in respect of this Note in accordance with Section 10.02, this Note (or the  applicable portion thereof) shall become due and payable on the Redemption Date at the  applicable Redemption Price.  On presentation and surrender of this Note to the  Borrower, this Note (or the applicable portion thereof) shall be paid and redeemed by the  Borrower at the applicable Redemption Price.  Section 10.04. Note Redeemed in Part.  Upon surrender of the portion of this Note  that is to be redeemed only in part in accordance with Section 10.01, and promptly after  the Redemption Date, the Borrower shall execute and deliver to the Holder, without  service charge, a new Note, of such authorized denomination or denominations as may be  requested by the Holder (which must be an integral multiple of $1,000 and which must be  at least $1,000), in aggregate principal amount equal to, and in exchange for, the portion  of the principal amount of this Note so surrendered that is not redeemed.  Section 10.05.   Restrictions on Redemption.  The Borrower may not redeem any  portion of this Note on any date if the principal amount of this Note has been accelerated  in accordance with the terms of this Note, and such acceleration has not been rescinded,  on or prior to the Redemption Date (except in the case of an acceleration resulting from a  Default by the Borrower in the payment of the Redemption Price with respect to this  Note).  ARTICLE 11  GUARANTEE  Section 11.01. Subsidiary Guarantees.  (a)  Subject to this Article 11, each  Guarantor hereby, jointly and severally, unconditionally guarantees to the Holder,  irrespective of the validity and enforceability of this Note or the obligations of the  Borrower hereunder, that:  (i) the principal of (including the Fundamental Change Repurchase  Price or the Redemption Price, if applicable) and interest on, this Note, and the  payment and, if applicable, delivery of any consideration due upon conversion of  this Note, shall be promptly paid and, if applicable, delivered in full when due  under this Note, whether at maturity, by acceleration, upon repurchase, upon  redemption, upon conversion or otherwise, and interest on the overdue principal  of (including the Fundamental Change Repurchase Price or the Redemption Price,  if applicable) and interest on this Note, if any, if lawful, and all other payment  and, if applicable, delivery obligations of the Borrower to the Holder hereunder  





 






38    shall be promptly paid and, if applicable, delivered in full or performed, all in  accordance with the terms hereof; and  (ii) in case of any extension of time of payment or, if applicable,  delivery or renewal of this Note or any of such other obligations, that same shall  be promptly paid and, if applicable, delivered in full when due or performed in  accordance with the terms of the extension or renewal, whether at stated maturity,  by acceleration, upon redemption, upon conversion or otherwise.  Failing payment or, if applicable, delivery when due of any amount so guaranteed  or any performance so guaranteed for whatever reason, the Guarantors shall be jointly  and severally obligated to pay and, if applicable, deliver the same immediately. Each  Guarantor agrees that this is a guarantee of payment and not a guarantee of collection.   (b) The Guarantors hereby agree that their obligations hereunder are  unconditional, irrespective of the validity, regularity or enforceability of this Note, the  absence of any action to enforce the same, any waiver or consent by the Holder with  respect to any provisions hereof, the recovery of any judgment against the Borrower, any  action to enforce the same or any other circumstance which might otherwise constitute a  legal or equitable discharge or defense of a guarantor. Each Guarantor hereby waives  diligence, presentment, demand of payment, filing of claims with a court in the event of  insolvency or bankruptcy of the Borrower, any right to require a proceeding first against  the Borrower, protest, notice and all demands whatsoever and covenant that this  Guarantee shall not be discharged except by complete performance of the obligations  contained in this Note or upon the release of such Guarantee pursuant to Section 11.06.  (c) If the Holder is required by any court or otherwise to return to the  Borrower, the Guarantors or any custodian, trustee, liquidator or other similar official  acting in relation to either the Borrower or the Guarantors, any amount paid or, if  applicable, delivered by the Borrower or the Guarantors to the Holder, this Guarantee, to  the extent theretofore discharged, shall be reinstated in full force and effect.  (d) Each Guarantor agrees that it shall not be entitled to any right of  subrogation in relation to the Holder in respect of any obligations guaranteed hereby until  payment and, if applicable, delivery in full of all obligations guaranteed hereby. Each  Guarantor further agrees that, as between the Guarantors, on the one hand, and the  Holder, on the other hand, (1) the maturity of the obligations guaranteed hereby may be  accelerated as provided in Article 6 for the purposes of this Guarantee, notwithstanding  any stay, injunction or other prohibition preventing such acceleration in respect of the  obligations guaranteed hereby, and (2) in the event of any declaration of acceleration of  such obligations as provided in Article 6, such obligations (whether or not due and  payable) shall forthwith become due and payable by the Guarantors for the purpose of  Guarantees. The Guarantors shall have the right to seek contribution from any non- paying or, if applicable, non-delivering Guarantor so long as the exercise of such right  does not impair the rights of the Holder under the Guarantees.  





 






39    Section 11.02. Limitation on Guarantor Liability.  Each Guarantor, and by its  acceptance of this Note, the Holder, hereby confirms that it is the intention of all such  parties that the Guarantee of such Guarantor not constitute a fraudulent transfer or  conveyance for purposes of Title 11, U.S. Code or any similar federal or state law for the  relief of debtors, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent  Transfer Act or any similar federal or state law to the extent applicable to such  Guarantee. To effectuate the foregoing intention, the Holder and each Guarantor hereby  irrevocably agree that the obligations of such Guarantor shall be limited to the maximum  amount that shall, after giving effect to such maximum amount and all other contingent  and fixed liabilities of such Guarantor that are relevant under such laws, and after giving  effect to any collections from, rights to receive contribution from or payments and, if  applicable, deliveries made by or on behalf of any other Guarantor in respect of the  obligations of such other Guarantor under this Article 11, result in the obligations of such  Guarantor under its Guarantee not constituting a fraudulent transfer or conveyance.  Section 11.03. Execution and Delivery of Guarantee.  Each Guarantor hereby  agrees that its Guarantee set forth in Section 11.01 shall remain in full force and effect  notwithstanding any failure to endorse on this Note a notation of such Guarantee.  Section 11.04. Consolidations; Merger; Conveyance; Transfer or Lease by  Guarantors. Each Guarantor may not, without the consent of the Holder, consolidate  with, merge into or convey, transfer or lease all or substantially all of the property and  assets of such Guarantor and its Subsidiaries, taken as a whole, to another Person (other  than a transfer of all or substantially all of the assets of such Guarantor and its  Subsidiaries, taken as a whole, to the Borrower or one or more direct or indirect Wholly  Owned Subsidiaries of the Borrower) (a “Guarantor Business Combination Event”)  unless:  (i) the resulting, surviving or transferee Person (the “Successor  Guarantor”) either (1) is such Guarantor or (2) if not such Guarantor, is  organized and existing under the laws of the United States of America or any  State thereof or the District of Columbia and is treated as the same type of entity  for U.S. federal income tax purposes as such Guarantor and expressly assumes, by  an assignment and assumption agreement, executed and delivered to the Holder,  in form reasonably satisfactory to the Holder, the obligations of such Guarantor  under its Guarantee; and  (ii) at the time of, and after giving effect to, such Guarantor Business  Combination Event, no Default or Event of Default shall have occurred and be  continuing.  Section 11.05. Successor Guarantor Substituted.  At the effective time of any  Guarantor Business Combination Event that complies with Section 11.04 the Successor  Guarantor (if not the Guarantor) shall succeed to, and be substituted for, and may  exercise every right and power of, such Guarantor under this Note with the same effect as  if such successor Person had been named as a Guarantor herein, and thereafter, except in  the case of a lease, and except for obligations the predecessor Person may have under an  





 






40    assignment and assumption agreement, the predecessor Person shall be relieved of all  obligations and covenants under the this Note.  Section 11.06. Releases.  The Guarantee of any Guarantor will be automatically  released:  (a) in connection with any sale, conveyance or transfer of all or substantially all  of the consolidated properties and assets of such Guarantor and its Subsidiaries, taken as  a whole (including by way of consolidation or merger) (other than to the Borrower or one  or more direct or indirect Wholly Owned Subsidiaries of the Borrower) in compliance  with Section 11.04;  (b) in connection with any sale, disposition or transfer of all of the Capital  Stock of such Guarantor to a Person (other than to the Borrower or one or more direct or  indirect Wholly Owned Subsidiaries of the Borrower); or  (c) upon satisfaction and discharge of this Note.    ARTICLE 12  MISCELLANEOUS  Section 12.01. Notices. All notices and other communications given or made  pursuant to this Note shall be in writing and shall be deemed effectively given upon the  earlier of actual receipt or refusal, when given by (a) personal delivery to the party to be  notified, (b) electronic mail or facsimile during normal business hours of the recipient,  with verification of receipt, and if not sent during normal business hours, then on the  recipient’s next Business Day, (c) registered or certified mail, return receipt requested,  postage prepaid, or (d) nationally recognized overnight courier, freight prepaid,  specifying next Business Day delivery, with written verification of receipt. All  communications shall be sent to the respective parties at the addresses set forth below:  If to the Holder:  Virgin Investments Limited  Craigmuir Chambers  Road Town, Tortola VG 1110  British Virgin Islands  Email:  vghl@harneys.com  Tel:   1-284-494-2233     w/ copy to:     Virgin Management USA, Inc.  65 Bleecker St., 6th Floor  New York, NY 10012  Attn:   General Counsel  





 






41    Email:   james.cahillane@virgin.com  Tel:  212-497-9098     If to the Borrower or to any Guarantor:  Virgin Orbit Holdings, Inc.   4022 E. Conant Street  Long Beach, CA 90808  Telephone: (562) 708-0026  Attention: Chief Financial Officer  E-Mail:  brita.o’rear@virginorbit.com    with a copy (which shall not constitute notice) to:    Derrick Boston, Chief Legal Officer  Virgin Orbit Holdings, Inc.  4022 E. Conant Street  Long Beach, CA 90808  Telephone: (562) 706-7108   E-Mail: derrick.boston@virginorbit.com    Latham & Watkins LLP  650 Town Center Drive, 20th Floor  Costa Mesa, CA 92626-1925  Telephone: (714) 755-8008  Attention: Drew Capurro  Email: Drew.Capurro@lw.com      Any party may change the address for notices by providing written notice to the party in  accordance with this Section 12.01. Any notice sent by electronic mail shall only be valid  if an original of such notice was subsequently received by the notified party, in which  case such notice shall be deemed received at such time specified above. Any such notice  may be given on behalf of a party hereto by such party’s counsel, or by any other person  authorized in writing by such party.  Section 12.02. Counterparts. This Note may be executed in two (2) or more  counterparts, each of which shall be deemed an original, but all of which together shall  constitute one and the same instrument. Counterparts may be delivered via facsimile,  electronic mail (including pdf or any electronic signature complying with the U.S. federal  ESIGN Act of 2000, e.g., www.docusign.com) or other transmission method and any  counterpart so delivered shall be deemed to have been duly and validly delivered and be  valid and effective for all purposes.  Section 12.03. GOVERNING LAW; Jurisdiction. THIS NOTE (INCLUDING,  FOR THE AVOIDANCE OF DOUBT, THE GUARANTEES INCLUDED HEREIN)  AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR  





 






42    RELATED TO THIS NOTE (INCLUDING, FOR THE AVOIDANCE OF DOUBT,  THE GUARANTEES INCLUDED HEREIN), SHALL BE GOVERNED BY AND  CONSTRUED IN ACCORDANCE WITH THE LAWS OF NEW YORK, WITHOUT  REGARD TO CONFLICTS OF LAWS PROVISIONS THEREOF TO THE EXTENT  THAT SUCH PROVISIONS WOULD RESULT IN THE SELECTION OF THE LAW  OF A DIFFERENT JURISDICTION AS THE GOVERNING LAW OF THIS NOTE.  The Borrower and each Guarantor irrevocably consents and agrees, for the benefit  of the Holder from time to time of this Note, that any legal action, suit or  proceeding against it with respect to obligations, liabilities or any other matter  arising out of or in connection with this Note (including, for the avoidance of  doubt, the Guarantees included herein) may be brought in the courts of the State  of New York or the courts of the United States located in the Borough of  Manhattan, New York City, New York and, until amounts due and to become due  in respect of this Note have been paid, hereby irrevocably consents and submits to  the non-exclusive jurisdiction of each such court in personam, generally and  unconditionally with respect to any action, suit or proceeding for itself in respect  of its properties, assets and revenues.    The Borrower and each Guarantor irrevocably and unconditionally waives, to the  fullest extent permitted by law, any objection which it may now or hereafter have  to the laying of venue of any of the aforesaid actions, suits or proceedings arising  out of or in connection with this Note (including, for the avoidance of doubt, the  Guarantees included herein) brought in the courts of the State of New York or the  courts of the United States located in the Borough of Manhattan, New York City,  New York and hereby further irrevocably and unconditionally waives and agrees  not to plead or claim in any such court that any such action, suit or proceeding  brought in any such court has been brought in an inconvenient forum.  Section 12.04. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, EACH  GUARANTOR AND THE HOLDER HEREBY IRREVOCABLY WAIVES, TO THE  FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT  TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR  RELATING TO THIS NOTE (INCLUDING, FOR THE AVOIDANCE OF DOUBT,  THE GUARANTEES INCLUDED HEREIN).  Section 12.05. Legal Holidays. In any case where any Interest Payment Date,  Fundamental Change Repurchase Date, Conversion Date or Maturity Date is not a  Business Day, then any action to be taken on such date need not be taken on such date,  but may be taken on the next succeeding Business Day with the same force and effect as  if taken on such date, and no interest shall accrue for the period from and after such date.  Section 12.06. No Security Interest Created. Nothing in this Note, expressed or  implied, shall be construed to constitute a security interest under the Uniform  Commercial Code or similar legislation, as now or hereafter enacted and in effect, in any  jurisdiction  





 






43    Section 12.07. Benefits of Note. Nothing in this Note, expressed or implied, shall  give to any Person, other than the parties hereto, any benefit or any legal or equitable  right, remedy or claim under this Note.  Section 12.08. Headings. The headings of the sections of this Note are inserted for  convenience only and shall not be deemed to constitute a part hereof.  Section 12.09. Successors and Assigns. Subject to the limitations contained  herein, this Note shall be binding upon the Borrower, and its respective successors and  assigns (including by merger, consolidation, amalgamation or otherwise), and shall inure  to the benefit of the Holder, and its designees, successors and assigns. This Note may not  be assigned by the Borrower without the prior written consent of the Holder.   Section 12.10. Registered Form. This Note is registered with respect to principal  and interest and any transfer of this Note may be effected only by the surrender of this  Note to the Borrower and either the reissuance of this Note by the Borrower and/or the  issuance of a new Note by the Borrower to the transferee.  Section 12.11. Amendment; Waiver. The terms and conditions of this Note shall  not be amended, changed, terminated or waived except by a writing, duly executed by the  Borrower and the Majority Holders. Upon the effectuation of such amendment, change,  termination or waiver with the consent of the Majority Holders in conformance with this  Section 12.11, such amendment, change, termination or waiver shall be effective as to,  and binding against the Holder of this Note and the holders of all of the Senior Unsecured  Convertible Notes issued pursuant to the Subscription Agreement. The Borrower shall  promptly give written notice of any such amendment, change, termination or waiver to  the Holder if the Holder has not previously consented to such amendment, change,  termination or waiver in writing; provided that the failure to give such notice shall not  affect the validity of such amendment, change, termination or waiver. Notwithstanding  the foregoing (a) if any amendment, change, termination or waiver materially and  adversely treats one or more holders of the Senior Unsecured Convertible Notes issued  pursuant to the Subscription Agreement in a manner that is disproportionate to such  treatment of all other holders, such amendment, change, termination or waiver shall also  require the written consent of holders disproportionately treated and (b) no such  amendment, change, termination or waiver shall (i) make any change to this Section  12.11, (ii) reduce the amount of Senior Unsecured Convertible Notes whose holders must  consent to an amendment, change, termination or waiver, (iii) reduce the rate of or extend  the stated time for payment of interest on this Note, (iv) reduce the principal of or extend  the Maturity Date of this Note, (v) make any change that adversely affects the conversion  rights of this Note, (vi) reduce the Redemption Price or the Fundamental Change  Repurchase Price (or amend or modify in any manner adverse to the Holder the  Borrower’s obligation to make such payments), or (vii) other than in accordance with the  terms of this Note, eliminate any Guarantee, in each case, without the written consent of  the Holder.  Section 12.12. Severability. In the event any one or more of the provisions  contained in this Note shall for any reason be held to be invalid, illegal or unenforceable  





 






44    in any respect, such invalidity, illegality or unenforceability shall not affect any other  provision hereof, and this Note shall be construed as if such invalid, illegal or  unenforceable provision had never been contained herein.  Section 12.13. Lost, Mutilated or Stolen Note. Upon receipt of evidence  reasonably satisfactory to the Borrower of the loss, theft, destruction or mutilation of this  Note and, in the case of any such mutilation, upon the surrender of this Note to the  Borrower at its principal office, the Borrower will execute and deliver, in lieu thereof, a  new Note of like tenor containing the same terms as this Note, dated so that there will be  no loss of interest on such lost, stolen, destroyed or mutilated Note. Any Note in lieu of  which any such new Note has been so executed and delivered by the Borrower shall not  be deemed to be an Outstanding Note for any purpose. If the Holder applies for a  substituted Note, the Holder shall furnish to the Borrower such security or indemnity as  may be required by the Borrower to save the Borrower harmless from any loss, liability,  cost or expense caused by or connected with such substitution, and, in case of  destruction, loss or theft, the Holder shall also furnish to the Borrower evidence to its  satisfaction of the destruction, loss or theft of such Note and of the ownership thereof.  Every substitute Note issued pursuant to the provisions of this Section 12.13 by virtue of  the fact that any old Note is destroyed, lost or stolen shall constitute an additional  contractual obligation of the Borrower, whether or not the destroyed, lost or stolen Note  shall be found at any time.  Section 12.14. Calculations. Except as explicitly stated herein, the Borrower shall  be responsible for making all calculations required pursuant to this Note, including,  without limitation, calculations with respect to determinations of the Last Reported Sale  Price, accrued interest payable on this Note, the Fixed Conversion Rate and the Financing  Conversion Rate. The Borrower shall make all such calculations in good faith and, absent  manifest error, the Borrower’s calculations shall be binding on the Holder. The Borrower  shall provide a written schedule of such calculations to the Holder upon the Holder’s  written request.  Section 12.15. No Personal Liability of Shareholders, Employees, Officer or  Directors . No director, officer, employee, incorporator or shareholder of the Borrower,  as such, will have any liability for any obligation of the Borrower under this Note or for  any claim based on, in respect of, or by reason of, such obligation or its creation. By  accepting this Note, the Holder waives and releases all such liability as part of the  consideration for issuance of this Note.  [Remainder of Page Intentionally Left Blank]    





 






[Signature Page to Senior Unsecured Convertible Note]  IN WITNESS WHEREOF, the undersigned has executed this Senior Unsecured  Convertible Note as of the date first set forth above.  BORROWER  VIRGIN ORBIT HOLDINGS, INC.  By:    Name:    Title:    CEO Dan Hart 





 






[Signature Page to Senior Unsecured Convertible Note]  GUARANTORS  VIECO USA, INC.  By:    Name:    Title:            VIRGIN ORBIT, LLC  By:    Name:    Title:         VIRGIN ORBIT NATIONAL SYSTEMS,  LLC  By:    Name:    Title:     JACM HOLDINGS, INC.  By:    Name:    Title:       President, Virgin Orbit National Systems Mark Baird Dan Hart Dan Hart CEO CEO Dan Hart CEO 





 






 





 






A-1 ATTACHMENT 1  [FORM OF NOTICE OF CONVERSION]  Senior Unsecured Convertible Note   To: Virgin Orbit Holdings, Inc.  Pursuant to Section 4.01 of this Note, the undersigned registered owner of this  Note hereby exercises the option to convert this Note, or the portion hereof (provided that  (i) such portion is an integral multiple of $1,000 principal amount and (ii) the portion of this Note not to be converted is not less than $1,000 in principal amount), below designated, and Virgin Orbit Holdings, Inc. (the “Borrower”), shall deliver shares of Common Stock, together with a cash payment, if applicable, in lieu of delivering any fractional share of Common Stock, in accordance with the terms of this Note and accrued and unpaid interest on the converted principal amount of this Note to, but excluding, the Conversion Date, and directs that any consideration issuable and deliverable upon such conversion, and the portion of this Note representing any unconverted principal amount hereof, be issued and delivered to the Holder unless a different name has been indicated below. If any shares of Common Stock or any portion of this Note not converted are to be issued in the name of a Person other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto. Date:  Signature(s)  Signature Guarantee  Signature(s) must be guaranteed by an  eligible Guarantor Institution (banks, stock  brokers, savings and loan associations and  credit unions) with membership in an  approved signature guarantee medallion  program pursuant to Securities and  Exchange Commission Rule 17Ad-15 if  shares of Common Stock are to be issued, or  Notes to be delivered, other than to and in  the name of the registered Holder.  





 






A-2    Fill in for registration of shares if to be  issued, and Note if to be delivered, other  than to and in the Holder:    (Name)    (Street Address)    (City, State and Zip Code  Please print name and address    Principal amount to be converted (if less  than all): $               ,000  NOTICE: The above signature(s) of the  Holder hereof must correspond with the  name as written upon the face of this  Note in every particular without alteration  or enlargement or any change whatever.    Social Security or Other Taxpayer  Identification Number      





 






  A-3    ATTACHMENT 2  [FORM OF FUNDAMENTAL CHANGE REPURCHASE NOTICE]  Senior Unsecured Convertible Note   To: Virgin Orbit Holdings, Inc.  The undersigned registered owner of this Note hereby acknowledges receipt of a  notice from Virgin Orbit Holdings, Inc. (the “Borrower”) as to the occurrence of a  Fundamental Change with respect to the Borrower and specifying the Fundamental  Change Repurchase Date. The undersigned registered owner of this Note hereby instructs  the Borrower to pay to the registered Holder hereof in accordance with the applicable  provisions of this Note (1) the entire principal amount of this Note, or the portion thereof  (provided that (i) such portion is an integral multiple of $1,000 principal amount and (ii)  the portion of this Note not to be repurchased is not less than $1,000 in principal amount)  below designated, and (2) accrued and unpaid interest, if any, thereon to, but excluding,  such Fundamental Change Repurchase Date.  Date:              Signature(s)      Social Security or Other Taxpayer  Identification Number    Principal amount to be converted (if  less than all): $               ,000  NOTICE: The above signature(s) of the  Holder hereof must correspond with the  name as written upon the face of this  Note in every particular without  alteration or enlargement or any change  whatever.        





 






  A-4    ATTACHMENT 3  [FORM OF ASSIGNMENT AND TRANSFER]  For value received                      hereby sell(s), assign(s) and transfer(s)  unto                      (Please insert social security or Taxpayer Identification Number of  assignee) the within Note, and hereby irrevocably constitutes and  appoints                    attorney to transfer the said Note on the books of the Borrower, with  full power of substitution in the premises.  In connection with any transfer of the within Note, the undersigned shall comply  with the requirements of this Note applicable to such transfer and confirms that this Note  is being transferred:  ☐ To Virgin Orbit Holdings, Inc. or a subsidiary thereof; or  ☐ Pursuant to the registration statement that has become or been declared effective  under the Securities Act of 1933, as amended; or  ☐ Pursuant to and in compliance with Rule 144 under the Securities Act of 1933, as  amended; or  ☐ Pursuant to another available exemption from registration under the Securities Act  of 1933, as amended.  Date:        Signature(s)    Signature Guarantee    Signature(s) must be guaranteed by an  eligible Guarantor Institution (banks, stock  brokers, savings and loan associations and  credit unions) with membership in an  approved signature guarantee medallion  program pursuant to Securities and  Exchange Commission Rule 17Ad-15 if  shares of Common Stock are to be issued, or  Notes to be delivered, other than to and in  the name of the registered Holder.  





 






A-5    NOTICE: The signature on the assignment must correspond with the name as written  upon the face of this Note in every particular without alteration or enlargement or any  change whatever.