Name Dated Amount Maturity Date
--------------------------------------- ------------ ---------- ---------------
Southshore Capital, Ltd.* July 9, 1999 $1,100,000 August 23, 1999
* This document has been filed.
PROMISSORY NOTE
$1,100,000.00 Switzerland
July, 9, 1999
FOR VALUE RECEIVED, the undersigned, SWISSRAY INTERNATIONAL INC., a New
York corporation (the "Borrower"), hereby promises to pay to the order of
SOUTHSHORE CAPITAL, LTD. (the "Lender"), the principal amount of $1,100,000.00
in lawful money of the United States of America in same day or other immediately
available funds, together with interest, payable on or before August 23, 1999.
In the event that this note is paid off on or before August 9, 1999, then the
Borrower shall pay the principal amount of 1,100,000 together with accrued
interest of three percent (3.0%) for a total of $1,133,000.
In the event that this note is paid off after August 9, 1999, the
Borrower shall still be responsible for the $33,000 of accrued interest. Also,
any principal amount still outstanding on August 23, 1999, shall bear interest
at a rate equal to three percent (3.0%) per thirty calendar period on a pro rata
basis until August 23, 1999.
The obligations of Borrower under this Note are secured under the
provisions of that certain Security Agreement dated July 9, 1999, by the
"Collateral" and all "proceeds" as those terms are defined in the Security
Agreement. The Collateral shall be purchase orders copies of which are attached
hereto as Exhibit A.
In the event the Promissory Note is not paid in full on or before its
due date, then in such event the terms of the Contingent Subscription Agreement,
Debenture and Registration Rights Agreement, which are incorporated herein by
reference and made a part hereof, shall apply and control. The "Due Date" of the
Promissory Note shall mean August 23, 1999.
Borrower hereby waives presentment, protest, notice of protest and
notice of dishonor of this Note. The non-exercise by the Lender of any rights
hereunder in any particular instance shall not constitute a waiver thereof in
that or any other subsequent instance. The Borrower shall no create any class
of indebtedness that ranks senior to this Note.
Nothing contained herein shall be deemed to establish or require the
payment of a rate of interest in excess of the maximum rate permitted by
applicable law. In the event that the rate of interest required to be paid
hereunder exceeds the maximum rate permitted by such law, such rate shall
automatically be reduced to the maximum rate permitted by such law.
The Borrower and any endorsers hereof, for themselves and their
respective representatives, successors and assigns expressly (a) waive
presentment, demand, protest, notice of dishonor, notice of non-payment, notice
of maturity, notice of protest, diligence in collection, and the benefit of any
applicable exemptions, including, but not limited to, exemptions claimed under
insolvency laws, and (b) consent that the Lender may release or surrender,
exchange or substitute any property or other collateral or security now held or
which may hereafter be held as security for the payment of this Promissory Note,
or may release any guarantor, or may extend the time for payment or otherwise
modify the terms of payment of any part or the whole of the debt evidenced
hereby.
Borrower hereby grants to Lender a security interest in the Collateral
to secure the payment of the entire Note balance. As to any Collateral, Lender
shall have the rights of a secured party under the Uniform Commercial Code as in
effect in the State of New York.
SECURED CREDITORS. Borrower represents and warrants that it shall not create or
incur any indebtedness or obligation for borrowed money except for indebtedness
with respect to trade obligations and other normal accruals in the ordinary
course of business not yet due and payable, and shall not grant any other
security interests until payment and performance in full of the obligations
hereunder, unless Xxxxxx otherwise consents in writing. Borrower represents,
warrants and covenants that the Collateral and proceeds are not subject to any
security interest, lien, prior assignment, or other encumbrance of any nature
whatsoever except for the security interest created by this Note.
AFFIRMATIVE COVENANTS. Borrower covenants and agrees that from the
date hereof until payment and performance in full of the obligations hereunder,
unless Xxxxxx otherwise consents in writing:
(a) Use of Proceeds. The proceeds disbursed under the Note shall be
used solely for working capital and/or costs related to assembly and delivery of
Borrower's ddR-Multi System.
(b) Borrower represents and warrants that there are no actions, suits,
investigations or proceedings pending or threatened against or affecting the
validity or enforceability of this Note and there are no outstanding orders or
judgments of any court or governmental authority or awards of any arbitrator or
arbitration board against the Borrower, except as may be indicated in Borrower's
current Registration Statement on Form S-1 as filed with the SEC under File No.
333-59829.
DEFAULT. If any of the following events occur (a "default"), Xxxxxx may declare
the entire Note balance, together with any other amounts that Borrower owes
Lender, to be immediately due and payable:
(a) Borrower fails to pay when due any principal or interest under
the terms of this Note;
(b) Borrower fails to observe or perform any covenant or agreement
set forth in this Note or in any instrument, document or agreement concerning
the Collateral;
(c) Xxxxxxxx makes a general assignment for the benefit of its
creditors, files or become the subject of a petition in bankruptcy, for an
arrangement with its creditors or for reorganization under any federal or state
bankruptcy or other insolvency law;
(d) Borrower files or becomes the subject of a petition for the
appointment of a receiver, custodian, trustee or liquidator of the party or of
all or substantially all of its assets under any federal or state bankruptcy or
other insolvency law;
(e) Borrower is voluntarily or involuntarily terminated or
dissolved;
(f) Borrower or any accommodation maker, endorser or guarantor enters
into any merger or consolidation, or sale, lease, liquidation or other
disposition of all or substantially all of its assets or any transaction outside
the ordinary course of its business or for less than fair consideration or
substantially equivalent value without Lender's prior written consent; or
(g) Any written representation or written statement made herein
or any other written representation or written statement made or furnished to
Lender by Borrower was materially incorrect or misleading at the time it was
made or furnished.
LITIGATION.
(a) Forum Selection and Consent to Jurisdiction. Any litigation based
on or arising out of, under, or in connection with, this Promissory Note shall
be brought and maintained exclusively in the federal courts of the State of New
York. The parties hereby expressly and irrevocably submit to the jurisdiction of
the federal courts of the State of New York for the purpose of any such
litigation as set forth above and irrevocably agrees to be bound by any final
judgment rendered thereby in connection with such litigation. The Borrower
further irrevocably consents to the service of process by registered mail,
postage prepaid, or by personal service within or without the State of New York.
The Borrower hereby expressly and irrevocably waives, to the fullest extent
permitted by law, any objection which it may have or hereafter may have to the
laying of venue of any such litigation brought in any such court referred to
above and any claim that any such litigation has been brought in any
inconvenient forum. To the extent that the Borrower has or hereafter may acquire
any immunity from jurisdiction of any court or from any legal process (whether
through service or notice, attachment prior to judgment, attachment in aid of
execution or otherwise) with respect to itself or its property, the Borrower
hereby irrevocably waives such immunity in respect of its obligations under this
agreement and the other loan documents.
(b) Waiver of Jury Trial. The Lender and the Borrower hereby knowingly,
voluntarily and intentionally waive any rights they may have to a trial by jury
in respect of any litigation based hereon, or arising out of, under, or in
connection with, this agreement, or any course of conduct, course of dealing,
statements (whether oral or written) or actions of the Lender or the Borrower.
The Borrower acknowledges and agrees that it has received full and sufficient
consideration for this provision and that this provision is a material
inducement for the Lender entering into this agreement.
MISCELLANEOUS.
(a) All pronouns and any variations thereof used herein shall be deemed
to refer to the masculine, feminine, impersonal, singular or plural, as the
identity of the person or persons may require.
(b) Neither this Promissory Note nor any provision hereof shall be
waived, modified, changed, discharged, terminated, revoked or canceled, except
by an instrument in writing signed by the party effecting the same against whom
any change, discharge or termination is sought.
(c) Notices required or permitted to be given hereunder shall be in
writing and shall be deemed to be sufficiently given when personally delivered
or sent by registered mail, return receipt requested, addressed: (i) if to the
Borrower, c/o Xxxx X. Xxxxx 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000 and
(ii) if to Lender c/o Xxxxxx X. XxXxxxx, Esq. 00 Xxxxxx Xxxxxx, Xxxxx 000, Xxx
Xxxxxx, XX 00000.
(d) This Promissory Note shall be enforced, governed and construed in
all respects in accordance with the laws of the State of New York, as such laws
are applied by New York courts to agreements entered into, and to be performed
in New York by and between residents of New York, and shall be binding upon the
undersigned, the undersigned's heirs, estate, legal representatives, successors
and assigns and shall inure to the benefit of the Lender, its successors and
assigns. If any provision of this Promissory Note is invalid or unenforceable
under any applicable statue or rule of law, then such provisions shall be deemed
inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law. Any provision hereof that
may prove invalid or unenforceable under any law shall not affect the validity
or enforceability of any other provision hereof.
THE BORROWER ACKNOWLEDGES THAT THE TRANSACTIONS IN CONNECTION WITH
WHICH THIS NOTE WAS EXECUTED AND DELIVERED AND WHICH ARE CONTEMPLATED BY THE
TERMS OF THE AGREEMENT ARE, IN ALL CASES, COMMERCIAL TRANSACTIONS; AND THE
BORROWER HEREBY EXPRESSLY WAIVES ANY AND ALL CONSTITUTIONAL RIGHTS IT MAY HAVE
AS NOW CONSTITUTED OR HEREAFTER AMENDED, WITH REGARD TO NOTICE, ANY JUDICIAL
PROCESS AND ANY AND ALL OTHER RIGHTS IT MAY HAVE, AND THE LENDER MAY INVOKE ANY
PREJUDGMENT REMEDY AVAILABLE TO IT OR ITS SUCCESSORS OR ASSIGNS.
SWISSRAY INTERNATIONAL INC.
By___________________________________
Xxxxx X. Xxxxxxx its Chairman and President
duly authorized
