RE: Richard, the ``Investor loan `` did not include 5,000,000 EDIG shares
posted on
Jan 23, 2006 09:40AM
Please note there are no added shares from the additional loan of $500,000.
The orignial note for $1,000,000 was prior to the ASHM.
Key paragraphs from the 8-K filed Nov 8, 2005
AMENDMENT TO
12% SUBORDINATED PROMISSORY NOTE AND WARRANT PURCHASE AGREEMENT
1. Aggregate Principal Amount. The Company is hereby authorized to issue an additional $500,000 in principal amount of Notes. In connection therewith, the aggregate principal amount of Notes referenced in (i) the first unnumbered Recital and (ii) Section 7 of the Agreement, is hereby increased from $1,000,000 to $1,500,000. Section 2.3 is hereby revised to delete the phrase “June 30, 2004” and replace it with November 30, 2005.” No increase in the number of Warrants is authorized by this Amendment.
2. Amendments to Note. Exhibit B is hereby deleted in its entirety and replaced with the Amended and Restated 12% Subordinated Promissory Note attached hereto as Exhibit A. Purchasers hereby consent to the revised terms contained therein including, without limitation, (i) a “Maturity Date” of December 31, 2006, (ii) amended “conversion” rights and (iii) a royalty to be paid solely to the purchasers of the additional $500,000 in Notes (the “Additional Notes”) as consideration for the additional financing necessary for the development of the Company’s new MedeViewer product, which shall, in the aggregate, shall be equal to up to Twenty Dollars ($20.00) for each MedeViewer sold for a period of three years (the “Royalty”). Purchaser hereby consents to the payment of the aggregate Royalty to the holders of the Additional Notes pro rata. Purchaser understands that Purchaser will not receive the Royalty unless Purchaser is a purchaser of Additional Notes.
5. Conversion.
5.1 Voluntary Conversion. Any Noteholder of this Note has the right, at the Noteholder’s option, at any time beginning forty-eight (48) hours after the date of the Note, and prior to payment in full of the principal balance of this Note at Maturity or any prepayment date, to convert this Note, in accordance with the provisions of Section 5.2.1 hereof, in whole or in part, into fully paid and nonassessable shares of common stock, $.001 par value per share, of the Company (the “Common Stock”). The number of shares of Common Stock into which this Note may be converted (“Conversion Shares”) shall be determined by dividing the aggregate principal amount of the Note by the Conversion Price (as defined below) in effect at the time of such conversion. The initial Conversion Price shall be equal to nineteen cents ($0.19).