Exhibit 4.2
DEBENTURE # ______________________________
CONVERTIBLE DEBENTURE
Due August 25, 1999
NATIONAL EQUITIES HOLDINGS, INC. (NEHI)
Obligation
NATIONAL EQUITIES HOLDINGS, INC. (NEHI), a corporation organized and
existing under the laws of the State of Delaware, for value received, promises
to pay the registered holder on the above due date, being a date two years or
less after the date of authentication below, the principal sum of
$__________________________________.
Holder _______________________________________________________________________.
Except as herein otherwise proved, National Equities Holdings, Inc. (NEHI) also
promises to pay interest on the principal sum from the date of authentication,
at a rate of eight percent (8%) per year until the principal sum has been paid.
The principal and interest on this Debenture is payable at the office of
National Equities Holdings, Inc. (NEHI) at 616 FM 1960 W., Suite #225, Houston,
Texas 77090.
Interest Payment
Interest on this Debenture will be paid on August 25 of each year.
After allocation of earnings has been made to cover all of National Equities
Holdings, Inc. (NEHI's) existing and continuing obligations, including any new,
customary, and extraordinary obligations incurred in the normal course of doing
business, and after the usual appropriates have been made for customary
reserves, funds, or accounts, the amount of earned surplus available for payment
of dividends or other purposes will be determined. All such surplus in each year
will first be used toward this issue, to pay the holders on a pro rata basis up
to the maximum percent of interest on this Debenture. Only when all holders
are paid the maximum percentage of interest on this Debenture will the surplus
be available for payment of dividends or other purposes as the Board of
Directors determines.
Series
This Debenture is one of a series of National Equities Holdings, Inc.
(NEHI) Debentures known as Convertible Debentures, with an aggregate principal
amount of $1,000,000, all of which are subject to the same terms and conditions
as this Debenture.
Page 1 of 3
Redemption
This Debenture will be redeemable at the option of National Equities
Holdings, Inc. (NEHI) in whole or part, at any time after the proper notice. The
redemption price will be the principal amount of this Debenture plus interest
accrued to the date fixed for redemption. In the event that less than all the
Debentures of this issue are to be redeemed, redemption will be, to the extent
possible, pro rata. This Debenture will become due and payable and will cease to
bear interest on the date fixed for the redemption.
Notice of Redemption
Before redeeming, National Equities Holdings, Inc. (NEHI) will notify
any registered holder of this Debenture of its intention to redeem and of the
redemption date at least thirty (30) days prior to such date. Notice shall be
sent by registered mail to the last address of the registered holder as it
appears on the books of National Equities Holdings, Inc. (NEHI).
Straight Conversion
This Debenture will be convertible at the option of the holder at any
time from and after the date of issue, and up to but not after one year from the
date of issue. If this Debenture is called for redemption, it will be
convertible at any time prior to the close of business on the fifth day
preceding the date fixed for redemption. This Debenture will be convertible into
fully paid and non assessable shares of National Equities Holdings Inc. (NEHI)
Preferred Stock in accordance with "Addendum A" attached to this Debenture. For
the Purpose of Addendum A, the principal sum written in the "obligation"
paragraph above is the "Initial Investment." In order to exercise the conversion
privilege, the holder of this Debenture will surrender it to National Equities
Holdings, Inc. (NEHI) with the proper notice of conversion as described below.
If the stock into which this Debenture is convertible is to be used in a name or
names other than that of the registered owner of this Debenture, the Debenture
must be accompanied by proper assignment.
Notice of Conversion
A holder desiring to convert this Debenture must give written notice to
National Equities Holdings, Inc. (NEHI) and, simultaneously, surrender this
Debenture together with a duly executed instrument of assignment and transfer,
in the form attached hereto as "Exhibit I", at National Equities Holdings, Inc.
(NEHI's) principal office at 616 FM 1960 W., Suite #225, Houston, Texas 77090.
NEHI will promptly issue to the holder the share of stock into which this
Debenture is to be converted.
Assignment
This Debenture may not be assigned without the prior notice to and
consent of National Equities Holdings, Inc. (NEHI) to the assignment, which
consent will not be given unless NEHI and NEHI's counsel are satisfied that the
assignment shall not violate any state or federal securities laws.
Page 2 of 3
IN WITNESS WHEREOF, National Equities Holdings, Inc. (NEHI) has caused
this Debenture to be signed by its President or other officer, and its seal to
be affixed hereto and attested by its Secretary this ________________________
day of ________________________, 19___.
NATIONAL EQUITIES HOLDINGS, INC. (NEHI)
By: -------------------------------
Name: Bill Knollenberg {Corporate Seal}
-------------------------------
Title: President
-------------------------------
Subscriber(s) Signature
-------------------------------
-------------------------------
Attest:
By: -------------------------------
Secretary
Page 3 of 3
THE STATE OF Texas
COUNTY OF Harris
BEFORE ME, the undersigned authority, on this day personally appeared
Bill Knollenberg, known to me to be the person whose name is/are subscribed to
the foregoing instrument, and acknowledged to me that he executed the same for
the purposed and consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this _____________ day of
______________________ of 19___.
-------------------------------------------
Notary Public in and for the State of Texas
My Commission Expires:
- ------------------------
--------------
Initial
--------------
Initial
SIGNATURE PAGE
IF SUBSCRIBER(S) IS/ARE INDIVIDUAL(S), INCLUDING JOINT TENANTS OR
TENANTS IN COMMON, SIGN IN THE SPACE(S) PROVIDED BELOW:
IN WITNESS WHEREOF, the undersigned has executed this Subscription and
Investment Representation Agreement and Power of Attorney this __________ day of
________________ of 19___. If Purchasing as a community property in one or both
names, both spouses should sign.
EXECUTION:
WITNESS:
- --------------------------- ---------------------------------
Signature
---------------------------------
Print Name
EXECUTION:
WITNESS:
- --------------------------- ---------------------------------
Signature
---------------------------------
Print Name
ACCEPTED BY:
Issuer's Agent
Date:
-------------------------------
By:
-------------------------------
Signature
Bill Knollenberg
-------------------------------
Print Name
President
-------------------------------
Title
--------------
Initial
--------------
Initial
Debenture No. _____________________
Addendum A
The Straight Conversion rate for this Convertible Debenture is $ per share of
NATIONAL EQUITIES HOLDINGS, INC. (NEHI) Debenture Total =
_________________________
- --------------------------------------
Bill M. Knollenberg
CONVERTIBLE BOND # __________________________
CONVERTIBLE BOND
Due August 25, 1999
NATIONAL EQUITIES HOLDINGS, INC. (NEHI)
Obligation
NATIONAL EQUITIES HOLDINGS, INC. (NEHI), a corporation organized and
existing under the laws of the State of Delaware, for value received, promises
to pay the registered holder on the above due date, being a date two years or
less after the date of authentication below, the principal sum of
$______________________________________.
Holder ________________________________________________________________________.
Except as herein otherwise proved, National Equities Holdings, Inc. (NEHI) also
promises to pay interest on the principal sum from the date of authentication,
at a rate of eight percent (8%) per year until the principal sum has been paid.
The principal and interest on this Bond is payable at the office of National
Equities Holdings, Inc. (NEHI) at 616 FM 1960 W., Suite #225, Houston, Texas
7090.
Interest Payment
Interest on this Bond will be paid on August 25 of each year. After
allocation of earnings has ben made to cover all of National Equities Holdings,
Inc. (NEHI's) existing and continuing obligations, including any new, customary,
and extraordinary obligations incurred in the normal course of doing business,
and after the usual appropriates have been made for customary reserves, funds,
or accounts, the amount of earned surplus available for payment of dividends or
other purposes will be determined. All such surplus in each year will first be
used toward this issue, to pay the holders on a pro rata basis up to the maximum
percent of interest on this Bond. Only when all holders are paid the maximum
percentage of interest on this Bond will the surplus be available for payment of
dividends or other purposes as the Board of Directors determines.
Series
The Bond is one of a series of National Equities Holdings, Inc. (NEHI)
Bonds known as Convertible Bonds, with an aggregate principal amount of
$1,000,000, all of which are subject to the same terms and conditions as this
Bond.
Page 1 of 3
Redemption
This Bond will be redeemable at the option of National Equities
Holdings, Inc. (NEHI) in whole or part, at any time after the proper notice. The
redemption price will be the principal amount of this Bond plus interest accrued
to the date fixed for redemption. In the event that less than all the Bonds of
this issue are to be redeemed, redemption will be, to the extent possible, pro
rata. This Bond will become due and payable and will cease to bear interest on
the date fixed for the redemption.
Notice of Redemption
Before redeeming, National Equities Holdings, Inc. (NEHI) will notify
any registered holder of this Bond of its intention to redeem and of the
redemption date at least thirty (30) days prior to such date. Notice shall be
sent by registered mail to the last address of the registered holder as it
appears on the books of National Equities Holdings, Inc. (NEHI).
Straight Conversion
This Bond will be convertible at the option of the holder at any time
from and after the date of issue, and up to but not after one year from the date
of issue. If this Bond is called for redemption, it will be convertible at any
time prior to the close of business on the fifth day preceding the date fixed
for redemption. This Bond will be convertible into fully paid and non assessable
shares of National Equities Holdings, Inc. (NEHI) Common Stock in accordance
with "Addendum A" attached to this Bond. For the Purpose of Addendum A, the
principal sum written in the "obligation" paragraph above is the "Initial
Investment." In order to exercise the conversion privilege, the holder of this
Bond will surrender it to National Equities Holdings, Inc. (NEHI) with the
proper notice of conversion as described below. If the stock into which this
Bond is convertible is to be used in a name or names other than that of the
registered owner of this Bond, the Bond must be accompanied by proper
assignment.
Notice of Conversion
A holder desiring to convert this Bond must give written notice to
National Equities Holdings, Inc. (NEHI) and, simultaneously, surrender this Bond
together with a duly executed instrument of assignment and transfer, in the form
attached hereto as "Exhibit I", at National Equities Holdings, Inc. (NEHI's)
principal office at 616 FM 1960 W., Suite #225, Houston, Texas 77090. NEHI will
promptly issue the holder the share of stock into which this Bond is to be
converted.
Assignment
This Bond may not be assigned without the prior notice to and consent
of National Equities Holdings, Inc. (NEHI) to the assignment, which consent will
not be given unless NEHI and NEHI's counsel are satisfied that the assignment
shall not violate any state or federal securities laws.
Page 2 of 3
IN WITNESS WHEREOF, National Equities Holdings, Inc. (NEHI) has caused
this Bond to be signed by its President or other officer, and its seal to be
affixed hereto and attested by its Secretary this ________________ day of
_____________________, 19___.
NATIONAL EQUITIES HOLDINGS, INC. (NEHI)
By: -------------------------------
Name: Bill Knollenberg {Corporate Seal}
-------------------------------
Title: President
-------------------------------
Subscriber(s) Signature
-------------------------------
-------------------------------
Attest:
By: -------------------------------
Secretary
Page 3 of 3
Bond No. _____________________
Addendum A
The Straight Conversion rate for this Convertible Bond is $ per share of
NATIONAL EQUITIES HOLDINGS, INC. (NEHI) Bond Total =
_________________________
- --------------------------------------
Bill M. Knollenberg
SIGNATURE PAGE
IF SUBSCRIBER(S) IS/ARE INDIVIDUAL(S), INCLUDING
JOINT TENANTS OR TENANTS IN COMMON, SIGN IN THE
SPACE(S) PROVIDED BELOW:
IN WITNESS WHEREOF, the undersigned has executed this Subscription and
Investment Representation Agreement and Power of Attorney this __________ day of
________________ of 19___. If Purchasing as a community property in one or both
names, both spouses should sign.
EXECUTION:
WITNESS:
- --------------------------- ---------------------------------
Signature
---------------------------------
Print Name
EXECUTION:
WITNESS:
- --------------------------- ---------------------------------
Signature
---------------------------------
Print Name
ACCEPTED BY:
Issuer's Agent
Date:
-------------------------------
By:
-------------------------------
Signature
Bill Knollenberg
-------------------------------
Print Name
President
-------------------------------
Title
19
--------------
Initial
--------------
Initial
THE STATE OF Texas
COUNTY OF Harris
BEFORE ME, the undersigned authority, on this day personally appeared
Bill Knollenberg, known to me to be the person whose name is/are subscribed to
the foregoing instrument, and acknowledged to me that he executed the same for
the purposed and consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this _____________ day of
______________________ of 19___.
-------------------------------------------
Notary Public in and for the State of Texas
My Commission Expires:
- ------------------------
20
--------------
Initial
--------------
Initial
DEBENTURE # ____________________________________
CONVERTIBLE DEBENTURE
Due January 5, 1998
ERIN GAS PRODUCERS, INC.
Obligation
ERIN GAS PRODUCERS, INC. (Erin Gas), a corporation organized and
existing under the laws of the State of Nevada, for value received, promises to
pay the registered holder on the above due date, being a date two years or less
after the date of authentication below, the principal sum of
$_____________________________________________.
Holder ________________________________________________________________________.
Except as herein otherwise proved, Erin Gas also promises to pay interest on the
principal sum from the date of authentication, at a rate of twelve percent (12%)
per year until the principal sum has been paid. The principal and interest on
this Debenture is payable at the office of Erin Gas at 2800 Post Oak-Transco
Tower, Suite #5260, Houston, Texas 77056.
Interest Payment
Interest on this Debenture will be paid on January 5 of each year.
After allocation of earnings has been made to cover all of Erin Gas's existing
and continuing obligations, including any new, customary, and extraordinary
obligations incurred in the normal course of doing business, and after the usual
appropriates have been made for customary reserves, funds, or accounts, the
amount of earned surplus available for payment of dividends or other purposes
will be determined. All such surplus in each year will first be used toward this
issue, to pay the holders on a pro rata basis up to the maximum percent of
interest on this Debenture. Only when all holders are paid the maximum
percentage of interest on this Debenture will the surplus be available for
payment of dividends or other purposes as the Board of Directors determines.
Series
This Debenture is one of a series of Erin Gas Debentures known as
Convertible Debentures, with an aggregate principal amount of $5,000,000, all of
which are subject to the same terms and conditions as this Debenture.
Page 1 of 3
Redemption
This Debenture will be redeemable at the option of Erin Gas, in whole
or part, at any time after the proper notice. The redemption price will be the
principal amount of this Debenture plus interest accrued to the date fixed for
redemption. In the event that less than all the Debentures of this issue are to
be redeemed, redemption will be, to the extent possible, pro rata. This
Debenture will become due and payable and will cease to bear interest on the
date fixed for the redemption.
Notice of Redemption
Before redeeming, Erin Gas will notify any registered holder of this
Debenture of its intention to redeem and of the redemption date at least thirty
(30) days prior to such date. Notice shall be sent by registered mail to the
last address of the registered holder as it appears on the books of Erin Gas.
Straight Conversion
This Debenture will be convertible at the option of the holder at any
time from and after the date of issue, and up to but not after one year from the
date of issue. If this Debenture is called for redemption, it will be
convertible at any time prior to the close of business on the fifth day
preceding the date fixed for redemption. This Debenture will be convertible into
fully paid and non assessable shares of Erin Gas common stock in accordance with
"Addendum A" attached to this Debenture. For the Purpose of Addendum A, the
principal sum written in the "obligation" paragraph above is the "Initial
Investment." In order to exercise the conversion privilege, the holder of this
Debenture will surrender it to Erin Gas with the proper notice of conversion as
described below. If the stock into which this Debenture is convertible is to be
used in a name or names other than that of the registered owner of this
Debenture, the Debenture must be accompanied by proper assignment.
Notice of Conversion
A holder desiring to convert this Debenture must give written notice to
Erin Gas and, simultaneously, surrender this Debenture together with a duly
executed instrument of assignment and transfer, in the form attached hereto as
"Exhibit I", at Erin Gas's principal office at 2800 Post Oak-Transco Tower,
Suite #5260, Houston, Texas 77056. Erin Gas will promptly issue to the holder
the share of stock into which this Debenture is to be converted.
Assignment
This Debenture may not be assigned without the prior notice to and
consent of Erin Gas to the assignment, which consent will not be given unless
Erin Gas and Erin Gas's counsel are satisfied that the assignment shall not
violate any state or federal securities laws.
Page 2 of 3
IN WITNESS WHEREOF, Erin Gas has caused this Debenture to be signed by
its President or other officer, and its seal to be affixed hereto and attested
by its Secretary this ________________ day of _____________________, 19___.
ERIN GAS PRODUCERS, INC.
By: -------------------------------
Name: Bill Knollenberg {Corporate Seal}
-------------------------------
Title: President
-------------------------------
Subscriber(s) Signature
-------------------------------
-------------------------------
Attest:
By: -------------------------------
Secretary
Page 3 of 3
Debenture No. _____________________
Addendum A
The Straight Conversion rate for this Convertible Debenture is $ per share of
ERIN GAS PRODUCERS, INC. Debenture Total = _________________________
- --------------------------------------
Bill M. Knollenberg
EXHIBIT I
ASSIGNMENT AND TRANSFER
The undersigned Assignee(s), holder of that certain Convertible
Debenture (the "Debenture") issued by ERIN GAS PRODUCERS, INC. ("Erin Gas") to
assignee, and dated as of _____________________________, 19__, hereby assigns
and transfers said Debentures to Erin Gas pursuant to the terms and conditions
of conversion set forth in said Debenture, and in exchange for the number of
shares of stock of Erin Gas listed on Addendum A to the Debenture that
correspond to the Initial Investment reflected in the first paragraph on the
bond entitled "Obligation".
IN WITNESS WHEREOF, I have signed my name this ________________ day of
____________________, 19___.
ASSIGNEE(S)
- --------------------------------------
Name:
-------------------------------
- --------------------------------------
Name:
-------------------------------
WITNESS:
- --------------------------------------
Name:
-------------------------------