EXHIBIT A PROMISSORY NOTE
EXHIBIT
A
PROMISSORY
NOTE
|
$500,000
|
Tampa,
Florida
|
|
June
17, 2009
|
FOR VALUE
RECEIVED, The WEB Channel Network, Inc., a Florida corporation (“Borrower”),
hereby agrees to pay to The WEB Channel Network, LLC. (“Holder”),
at 19901 Arbor Path, Lutz, Florida 33559 or at such other place as the Holder
may designate in writing from time to time, the principal sum of FIVE HUNDRED
THOUSAND DOLLARS ($500,000), together with interest on the principal balance of
this obligation from time to time remaining unpaid, at the rate and at the times
provided in this Promissory Note (“this
Note”). All payments required by this Note must be by legal
tender of the United States of America.
1.
Interest. The outstanding
principal amount of this Note shall bear interest beginning on the date of this
Note at a rate equal to eight percent (8%) per annum, calculated on a
non-compounded simple rate basis, using a 365-day year, for the actual number of
days elapsed through the actual payment date. Interest shall accrue
and be paid at maturity with the principal balance. Notwithstanding
anything contained herein, from and after the occurrence and during the
continuance of an Event of Default pursuant to Section 5 below, this Note shall
bear interest on the due and unpaid principal amount at the default rate
(the “Default
Rate”) equal to the twelve percent (12%) per annum.
2.
Security. This Note is secured by
certain assets of Borrower pursuant to a Security Agreement of even date
herewith between Borrower and Holder.
3.
Method of
Repayment. The total amount of
this Note shall be paid in five annual and equal principal payments of $100,000
plus accrued interest on the anniversary dates of this Note.
4.
Prepayments. This Note may be
prepaid at Borrower’s option without the consent of the Holder, either in whole
or in part, at any time and from time to time without premium or
penalty.
5.
Events of
Default. For
purposes of this Note, an “Event of
Default” is: (i) a failure to pay any
portion of the principal amount or interest on this Note when due; (ii) any event or condition
shall occur which (A)
results in the acceleration of the maturity of any long-term debt (other than
this Note), equipment lease line, or real estate lease of Borrower, or (B) enables (or, with the
giving of notice or lapse of time or both, would enable) the holder of such
long-term debt, equipment lease line, or real estate lease, or any or person
acting on such holder’s behalf, to accelerate the maturity thereof; (iii) admission by the
Borrower of its inability to pay its debts generally as they become due or
otherwise acknowledges its insolvency; (iv) the filing of a petition
in bankruptcy by the Borrower or the execution by the Borrower of a general
assignment for the benefit of creditors; (v) the filing against the
Borrower of a petition in bankruptcy or a petition for relief under the
provisions of the federal bankruptcy code or another state or federal law for
the relief of debtors and the continuation of such petition without dismissal
for a period of ninety (90) days or more; (vi) the Borrower’s ceasing to
carry on business; (vii)
the sale, transfer, or other disposition of all or substantially all of the
assets of the Borrower or a merger, acquisition, consolidation or similar
transaction which results in the Borrower’s stockholders immediately prior to
such transaction holding less than fifty percent (50%) of the voting power of
the surviving, continuing or purchasing entity; or (viii) a breach by Borrower of
any covenant, condition, or obligation contained in the Asset Purchase Agreement
of even date herewith among Borrower, Holder and others. If an Event
of Default occurs, Xxxxxx may declare all of the outstanding principal amount of
this Note, including any interest due thereon, to be due and payable
immediately. Borrower shall pay interest on such amount in cash at
the Default Rate to Holder if such amount is not paid within two (2) days of
Holder’s request. The remedies under this Note shall be
cumulative.
6.
Waivers. No delay on the part of
Holder in exercising any right or remedy hereunder shall operate as a waiver of
such right or remedy. No single or partial exercise of a right or
remedy shall preclude other or further exercise of that or any other right or
remedy. The failure of Holder to insist upon the strict performance
of any term of this Note, or to exercise any right or remedy hereunder, shall
not be construed as a waiver or relinquishment by Holder for the future of that
term, right or remedy. No waiver of any right of Holder hereunder
shall be effective unless in writing executed by Xxxxxx.
7.
Severability. The unenforceability or
invalidity of any provision or provisions of this Note as to any persons or
circumstances shall not render that provision or those provisions unenforceable
or invalid as to any other provisions or circumstances, and all provisions
hereof, in all other respects, shall remain valid and enforceable.
8.
WAIVER OF
JURY TRIAL.
XXXXXXXX AND HOLDER ACKNOWLEDGE THAT THE RIGHT TO TRIAL BY JURY MAY BE
WAIVED. EACH PARTY, AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY
TO CONSULT) WITH COUNSEL OF THEIR CHOICE, KNOWINGLY AND VOLUNTARILY, AND FOR
THEIR MUTUAL BENEFIT, WAIVES ANY RIGHT TO TRIAL BY JURY IN THE EVENT OF
LITIGATION REGARDING THE PERFORMANCE OR ENFORCEMENT OF, OR IN ANY WAY RELATED
TO, THIS NOTE.
9.
Binding
Effect. This
Note shall be binding on and inure to the benefit of the parties hereto and
their respective successors and assigns.
10. Governing
Law and Venue.
This Note shall be governed by and construed in accordance with the laws
of the State of Florida, without reference to principles of choice of law
thereunder. The venue for any judicial or arbitration proceedings
arising out of this Note or the obligations hereunder shall be in the state
courts of Hillsborough County, Florida.
11. Compliance
With Usury Laws.
As it is the intent of all parties to this transaction to abide by the
interest limitations of any applicable usury law, it is expressly agreed,
anything herein to the contrary notwithstanding, that Holder shall not be
allowed or entitled to collect any interest (or any sum which is considered
interest by law) which is in excess of any legal rate applicable
hereto. Should any amount be collected hereunder which would cause
the interest to exceed said lawful rate, such part of said amount in excess of
the lawful rate shall automatically be credited to principal, or, if all
principal amounts have been paid, shall be refunded to Borrower. The
provisions of this Note are hereby modified to the extent necessary to conform
to the limitations and provisions of this paragraph. This paragraph
shall govern over all other provisions in any document or agreement now or
hereafter existing.
12. Documentary
Stamp Tax Liability. Holder
shall pay any and all documentary stamp tax and any other excise tax due and
payable on this Note. Holder shall further indemnify and save
harmless Borrower from any documentary stamp tax or intangibles tax assessed by
the State of Florida with respect to this Note, including, without limitation,
any penalties and interest.
13. Costs. In
the event that this Note is collected by law or through attorneys at law, or
under advice therefrom, Borrower hereby agrees to pay all costs of collection,
including reasonable attorneys’ fees and costs, whether or not suit is brought,
and whether incurred in connection with collection, trial, appeal, bankruptcy or
other creditors’ proceedings or otherwise.
14. Application
of Payments. All principal, interest and any other amounts due
under this Note shall be payable in lawful money of the United States of America
at the place or places above stated. All payments shall be credited
first to costs and expenses, if any, incurred by Xxxxxx in collecting any
amounts due hereunder, second to any late payment charges and interest accrued
at the Default Rate (as defined above), third to past due interest, fourth to
principal and any other amounts due hereunder.
IN
WITNESS WHEREOF, the Borrower has executed and delivered this Note effective as
of the date stated above.
“Borrower”
| The WEB Channel Network, Inc. | |
| By: /s/ Xxxxxx X. Xxxxxx | |
| Xxxxxx X. Xxxxxx, President |
