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EXHIBIT 10.39
EUPHONIX, INC.
AMENDMENT TO SECURED PROMISSORY NOTE
This Amendment (the "Amendment"), dated January 12, 2001, to the Secured
Promissory Note (the "Note"), dated April 14, 2000, in the aggregate amount of
eight hundred thousand dollars ($800,000), by and among Euphonix, Inc., a
California corporation ("Borrower"), Dieter Meier, Walter Bosch, and Onset
Ventures (individually an "Investor" and collectively the "Investors" or the
"Lender"). Capitalized terms not defined here shall have the meaning set forth
in the Note.
RECITALS
A. On April 14, 2000, Borrower and the Investors executed the Note,
pursuant to which Borrower promised to pay each Investor up to the Maximum
Principal Amount set forth in the Note, pursuant to the terms set forth in the
Note.
B. Section C.1 of the Note provides that the outstanding principal sum
of the Note, together with the accrued interest thereon, shall be due and
payable on January 1, 2001.
C. Section C.4 of the Note provides that Investors representing
two-thirds (2/3) of the outstanding principal sum of the Note may demand payment
of the outstanding principal sum of the Note, together with the accrued interest
thereon, on January 1, 2001, if any necessary shareholder, regulatory and other
approvals or consents for the convertibility of the Note are not obtained by
June 30, 2000.
D. As of the date hereof, the shareholders of Borrower have not yet
approved the convertibility of the Note.
E. Section H.3 of the Note provides that the Note may not be amended,
except by written instrument signed by Borrower and the Lender.
NOW, THEREFORE, in consideration of the mutual promises set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
ARTICLE I: AMENDMENTS
1. Subsection C.1 of the Note is hereby amended by deleting such
subsection in its entirety and substituting in lieu thereof the following new
subsection:
"Scheduled Payment. Subject to other provisions of this Note, the
outstanding principal sum of this Note, together with the accrued
interest thereon, shall be due and payable on July 31, 2001."
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2. Subsection C.4 of the Note is hereby amended by deleting such
subsection in its entirety and substituting in lieu thereof the following new
subsection:
"Immediate Payment. Notwithstanding anything herein to the contrary, in
the event that all necessary shareholder, regulatory and other approvals
or consents for the convertibility of this Note as set forth below are
not obtained by July 31, 2001, (i) the outstanding principal sum from
all Advances as of the date thereof and all future Advances from the
date thereof and (ii) accrued interest thereon, shall be repaid in full
upon demand by the Investors representing two-thirds (2/3) of the then
outstanding principal sum of this Note; provided, however, that the
Investors must provide at least one (1) month prior written notice to
the Borrower prior to such demand. In addition, such demand may not be
made (x) if shareholder approval for the convertibility of this Note is
not obtained as a result of the Investors failing to vote or consent for
such convertibility, or (y) if shareholder approval for the
convertibility of this Note would not be required so long as the
Borrower obtain shareholder approval with respect to such other security
issuances by the Borrower, but shareholder approval with respect to such
other issuances not be obtained as a result of the investors failing to
vote or consent with respect to such other issuances."
ARTICLE II: GENERAL
1. Governing Law; Venue. This Note shall be governed by the laws of the
State of California, without giving effect to conflicts of law principles.
Borrower and Lender agree that all actions or proceedings arising in connection
with this Note shall be tried and litigated only in the state and federal courts
located in the City and County of Santa Clara, State of California or, at
Lender's option, any court in which Lender determines it is necessary or
appropriate to initiate legal or equitable proceedings in order to exercise,
preserve, protect or defend any of its rights and remedies under this Note or
otherwise or to exercise, preserve, protect or defend its Lien, and the priority
thereof, against the Collateral, and which has subject matter jurisdiction over
the matter in controversy.
2. Entire Agreement; Counterparts. This Amendment and the Note together
embody the entire understanding and agreement between Borrower and the Investors
and supersede all prior agreements and understandings relating to the subject
matter hereof. This Amendment and the Note shall not be further amended except
by an instrument in writing signed by the parties hereto. This Amendment may be
executed in any number of counterparts, each of which shall be enforceable
against the parties actually executing such counterparts, and all of which
together shall constitute one instrument.
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IN WITNESS WHEREOF, the Borrower and each of the Investors has caused
this Note to be duly executed on the date first written above.
EUPHONIX, INC.
By:
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Name: Steve Vining
Title: Chief Executive Officer
INVESTORS
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Dieter Meier
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Walter Bosch
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Onset Ventures
By:
Title:
[SIGNATURE PAGE TO AMENDMENT TO SECURED PROMISSORY NOTE]