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FOR VALUE RECEIVED, [Model Corporation], a [Delaware/International] corporation (the “Company”), hereby promises to pay Atlassian Ventures LLC (the “Lender”), the principal sum of $250,000.00, together with interest thereon from the date of this Note. Interest shall accrue at a rate of six percent (6%) per annum, compounded annually. Unless earlier converted into shares of Equity Securities (as defined below) pursuant to the terms of this Note, the principal and accrued interest shall be due and payable by Company on demand by Lender at any time after the earlier of: (i) [Maturity Date][1]and (ii) the closing of the Next Equity Financing (as defined below).
Payment. All payments shall be made in lawful money of the United States of America at the principal office of the Company, or at such other place as the holder hereof may from time to time designate in writing to the Company. Payment shall be credited first to Costs (as defined below), if any, then to accrued interest due and payable and the remainder applied to principal. Prepayment of principal, together with accrued interest, may not be made without Lender’s written consent. The Company hereby waives demand, notice, presentment, protest and notice of dishonor.
Security. This Note is a general unsecured obligation of the Company.
Representations and Warranties of the Company. In connection with the transactions provided for herein, the Company hereby represents and warrants to the Lender that:
3.1 Organization, Good Standing and Qualification. The Company is a corporation duly organized, validly existing and in good standing under the laws of [the State of Delaware/Country] and has all requisite corporate power and authority to carry on its business as now conducted. The Company is duly qualified to transact business and is in good standing in each jurisdiction in which the failure to so qualify would have a material adverse effect on its business or properties.
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3.4 Valid Issuance of Capital Stock. The capital stock, when issued, sold and delivered upon conversion of this Note, will be duly authorized, validly issued, fully paid and nonassessable and, based in part upon the representations of the Lender herein, will be issued in compliance with all applicable federal and state securities laws.
4. Representations and Warranties of the Lender. In connection with the transactions provided for herein, Lender hereby represents and warrants to the Company that:
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4.6 California Corporate Securities Law. THE SALE OF THE SECURITIES WHICH ARE THE SUBJECT OF THIS NOTE HAS NOT BEEN QUALIFIED WITH THE COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF SUCH SECURITIES OR THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION FOR SUCH SECURITIES PRIOR TO SUCH QUALIFICATION IS UNLAWFUL, UNLESS THE SALE OF SECURITIES IS EXEMPT FROM QUALIFICATION BY SECTION 25100, 25102 OR 25105 OF THE CALIFORNIA CORPORATIONS CODE. THE RIGHTS OF ALL PARTIES TO THIS NOTE ARE EXPRESSLY CONDITIONED UPON SUCH QUALIFICATION BEING OBTAINED, UNLESS THE SALE IS SO EXEMPT.
5. Further Agreements.
5.1 Conversion of the Note. The Note shall be convertible according to the following terms:
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(c) If the Company receives a bona fide written proposal from a third party for a proposed transaction that, if consummated, would qualify as a Corporate Transaction, and that the Company has determined to engage in further discussions with such third party regarding such proposal, the Company shall notify Lender at least five (5) business days in advance of entering into any binding exclusivity arrangement, definitive agreement, term sheet, letter of intent or similar agreement with respect to a proposed transaction, to allow Lender time to consult with the Company prior to entering into a binding exclusivity arrangement, definitive agreement, term sheet, letter of intent or similar agreement. For the avoidance of doubt, the Company shall not be obligated to disclose the terms of the proposal or identity of the third party to Lender pursuant to this Note. The Company shall have no obligation to accept or consider any proposal by Lender that results from any such five (5) day period of consultation.
6. Miscellaneous.
6.1 Successors and Assigns. Except as otherwise provided herein, the terms and conditions of this Note shall inure to the benefit of and be binding upon the respective successors and assigns of the parties; provided, however that the Company may not assign its obligations under this Note without the written consent of the Holder. Nothing in this Note, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations or liabilities under or by reason of this Note, except as expressly provided in this Note.
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