sjdocs-7222568v1paltar_natio.htm - Generated by SEC Publisher for SEC Filing



THE SECURITIES
REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION
WITH, THE SALE OR DISTRIBUTION THEREOF.  NO SUCH SALE OR DISTRIBUTION MAY BE
EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN
OPINION OF COUNSEL IN A FORM SATISFACTORY TO paltar
nation Limited Partnership THAT SUCH REGISTRATION IS NOT REQUIRED UNDER
THE SECURITIES ACT OF 1933.


SECURED CONVERTIBLE
PROMISSORY NOTE


USD$584,000                                                                                                                                    


Dated: October 14, 2015

Effective: August 4, 2015

                                                                                                                        
Denver, Colorado 


For value received, PALTAR NATION LIMITED
PARTNERSHIP, a Delaware limited partnership (the “Partnership”),
promises to pay to David N. Siegel Dynasty Trust dated November 16, 2015 (the “Holder”),
the principal sum of Five Hundred Eighty-Four Thousand Dollars (USD$584,000).
Interest shall accrue from the date of this Secured Convertible Promissory Note
(this “Note”) on the unpaid principal amount hereunder at a rate equal
to 10.00% per annum; provided, that on and after the Maturity Date (as
defined below) or an Event of Default (as defined below), interest shall accrue
from and after such date on the unpaid principal and all accrued but unpaid
interest of this Note at a rate equal to 15.00% per annum.  This Note is one of
a number of promissory notes (collectively, the “Notes”) issued under
that certain Secured Convertible Note Purchase Agreement initially dated as of August
4, 2015, by and among the Partnership and the Purchasers listed on the
signature pages thereto (the “Purchase Agreement”).  This Note is
subject to the following terms and conditions:


1.           
Maturity.  Unless converted as
provided herein, all principal and any accrued but unpaid interest under this
Note shall be due and payable on August 4, 2016 (the “Maturity Date”). 
Subject to Section 2 below, interest
shall accrue on this Note and shall be due and payable in full on the Maturity
Date.  Notwithstanding the foregoing, the entire unpaid principal sum of this
Note, together with accrued and unpaid interest thereon, shall become
immediately due and payable upon a material breach by (a) the Partnership of
this Note, another Note or the Purchase Agreement, or (b) Wotan Group Limited,
an Australian limited company (ACN 14998651), of the Pledge Agreement (as
defined below), in each case that is not cured within thirty (30) days of such
breach (an “Event of Default”).


2.           
Conversion.


(a)          
Qualified
Financing.  Upon a sale of the
Partnership’s limited partnership interests (“Interests”) in a single
transaction or a series of related transactions yielding gross cash proceeds to
the Partnership of at least $20,000,000 (including without limitation, this
Note and any other Notes issued under the Purchase Agreement) on or before the
Maturity Date (a “Qualified Financing”), the principal and any
accrued but unpaid interest under this Note shall automatically be converted
into Interests upon the terms set forth in Section 2(b) below.


(b)         
Terms
of Conversion.  The Interests to be
issued to the Holder upon a conversion pursuant to Section 2(a) shall be equal to
the quotient obtained by dividing (i) the entire principal amount of this Note
plus any accrued but unpaid interest under this Note by (ii) 80.00% of the
per-Interest price of the Interests sold to persons other than holders of Notes
in a Qualified Financing.  The issuance of such Interests upon such conversion
shall be substantially upon the same terms and subject
to the same conditions applicable to the Qualified Financing and the
Partnership’s limited partnership agreement and other documents governing such
Qualified Financing.  Upon such conversion of this Note, the Partnership and
the Holder hereby agree to execute and deliver to each other all transaction
documents related to the Qualified Financing necessary to effect the issuance
of the Interests to the Holder.



 



3.           
Conversion
Procedure.


                                                  
(a)       
Conversion.  If this Note is converted
pursuant to Section 2(a),
the Partnership shall give written notice to the Holder, notifying the Holder
of the conversion to be effected, the applicable conversion price, the amount
of principal and any accrued but unpaid interest to be converted, the Interests
to be issued, the date on which such conversion is expected to occur and a
request for such Holder to physically surrender this Note to the Partnership. 
Upon receipt of such notice, the Holder shall surrender this Note at the
Partnership’s principal executive office, or, if this Note has been lost,
stolen, destroyed or mutilated, then, in the case of loss, theft or
destruction, the Holder shall deliver an indemnity agreement reasonably
satisfactory in form and substance to the Partnership or, in the case of
mutilation, the Holder shall surrender and cancel this Note.  Such conversion
shall be deemed to have been made in connection with the closing of the
Qualified Financing, and on and after such date the person entitled to receive
the Interests issuable upon such conversion shall be treated for all purposes
as the record holder of such Interests.


                                                 
(b)       
Same Rights.  Upon conversion of this
Note into Interests, the Partnership shall ensure that the Holder is given the
same rights with respect to such Interests as those granted to the similarly
situated purchasers of Interests in the Qualified Financing.


 


4.           
Payment;
Prepayment.  All payments
hereunder shall be made in lawful money of the United States of America at the
Holder’s address on the signature page attached hereto or at such other place
as the Holder hereof may from time to time designate in writing to the
Partnership.  The Partnership may prepay this Note at any time without penalty
by providing all holders of the Notes written notice of the Partnership’s
intent to prepay the Notes, but prepayment shall not occur without the prior
written consent of the holders of a majority of the aggregate outstanding
principal amounts owed under all of the Notes. Such prepayment shall be made on
a pro rata basis based on the respective aggregate outstanding amount of each
Note to be prepaid.


5.           
Security.  The Holder’s rights
under this Note are secured by the “Pledged Securities”, as defined in the
Pledge Agreement, dated as of August 4, 2015, executed by Wotan Group
Limited, an Australian limited company, in favor of the Secured Parties (as
defined therein) listed on the signature pages thereto (including the Holder
hereunder) (the “Pledge Agreement”).


6.           
Transfer;
Successors and Assigns.  The terms and conditions of this Note shall
inure to the benefit of and be binding upon the respective successors and
assigns of the Partnership and the Holder.  Notwithstanding the foregoing, the
Holder may not assign, pledge, or otherwise transfer this Note without the
prior written consent of the Partnership.  Subject to the preceding sentence,
this Note may be transferred only upon surrender of the original Note (or an
indemnity agreement if the Note is lost, stolen or destroyed) for registration
of transfer, duly endorsed, or accompanied by a duly executed written
instrument of transfer in form satisfactory to the Partnership.  Thereupon, a
new note for the same principal amount and interest will be issued to, and
registered in the name of, the transferee.  Interest and principal are payable
only to the registered holder of this Note.  The Partnership cannot assign this
Note or its obligations or rights hereunder without the approval of the Holder.


7.           
Governing
Law.  This Note and all
acts and transactions pursuant hereto and the rights and obligations of the
Partnership and the Holder shall be governed, construed and interpreted
in accordance with the laws of the state of Delaware, without giving effect to
principles of conflicts of law.  



 



8.           
Notices.  All notices and other communications given or made
pursuant to this Note shall be in writing and shall be deemed effectively given
upon: (a) personal delivery to the party to be notified, (b) when sent, if
received by electronic mail or facsimile during normal business hours of the
recipient, and if not received during normal business hours, then on the
recipient’s next business day, (c) five (5) business days after having been
sent by registered or certified mail, return receipt requested, postage prepaid,
or (d) three (3) business days after deposit with a 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 their address as set forth on the signature pages
to the Purchase Agreement, or as subsequently modified by written notice. 


9.           
Amendments
and Waivers.  Any term of this
Note may be amended only with the written consent of the Partnership and the
holders of a majority of the aggregate outstanding principal amount owed under
all of the Notes; provided, that the following terms cannot be amended
without the consent of the holder of this Note: a reduction in the interest
rate, accrued interest or principal amount owed on this Note or the
convertibility price and/or discount of this Note.


10.         
Entire
Agreement.  This Note, any
Confidentiality Agreement between the Partnership and a Purchaser, the Purchase
Agreement, the Pledge Agreement and the documents referred to herein and
therein, constitute the entire agreement between the Partnership and the Holder
pertaining to the subject matter hereof and thereof, and any and all other
written or oral agreements existing between the Partnership and the Holder are
expressly canceled.


11.         
Interest
Rate Limitation.  Notwithstanding anything to the contrary contained in
this Note or the Purchase Agreement (the “Loan Documents”), the interest
paid or agreed to be paid under the Loan Documents shall not exceed the maximum
rate of non-usurious interest permitted by applicable law (the “Maximum Rate”). 
If the Holder shall receive interest in an amount that exceeds the Maximum
Rate, the excess interest shall be applied to the principal remaining owed
under this Note or, if it exceeds such unpaid principal, refunded to the
Partnership.  In determining whether the interest contracted for, charged, or
received by the Holder exceeds the Maximum Rate, the Holder may, to the extent
permitted by applicable law, (a) characterize any payment that is not principal
as an expense, fee, or premium rather than interest, (b) exclude voluntary
prepayments and the effects thereof, and (c) amortize, prorate, allocate, and
spread in equal or unequal parts the total amount of interest throughout the
contemplated term of this Note.


12.         
Loss
of Note.  Upon receipt by the
Partnership of evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Note and, in the case of loss, theft or
destruction, delivery of an indemnity agreement reasonably satisfactory in form
and substance to the Partnership or, in the case of mutilation, on surrender
and cancellation of this Note, the Partnership shall execute and deliver, in
lieu of this Note, a new Note executed in the same manner as this Note, in the
same principal amount as the unpaid principal amount of this Note and dated the
date to which interest shall have been paid on this Note or, if no interest
shall have yet been so paid, dated the date of this Note.


[Signature Pages
Follow]


 












 





IN WITNESS WHEREOF, the Partnership has executed this Secured Convertible Promissory Note as of the date first set forth above.


the Partnership:


Paltar nation Limited partnership


By: /s/ Carmen J. Lotito                                   


                           (Signature)


Name: Carmen J. Lotito                                   


Title: Vice President                                         


AGREED TO AND ACCEPTED:


/s/ Robert Telles                                              


Trustee                                                            


David N. Siegel Dynasty Trust dated November 16, 2015


      


 




[Signature Page to Secured Convertible Promissory Note]