Contract
Exhibit 10.1
THIS NOTE, AND THE SECURITIES INTO WHICH IT IS CONVERTIBLE (COLLECTIVELY, THE “SECURITIES”), HAVE NOT BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE. THE SECURITIES ARE BEING OFFERED PURSUANT TO A SAFE HARBOR FROM REGISTRATION UNDER REGULATION D PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). THE SECURITIES ARE “RESTRICTED” AND MAY NOT BE OFFERED OR SOLD UNLESS THE SECURITIES ARE REGISTERED UNDER THE ACT, PURSUANT TO REGULATION D OR PURSUANT TO AVAILABLE EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND THE COMPANY WILL BE PROVIDED WITH OPINION OF COUNSEL OR OTHER SUCH INFORMATION AS IT MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH EXEMPTIONS ARE AVAILABLE. FURTHER HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE MADE EXCEPT IN COMPLIANCE WITH THE ACT.
CONVERTIBLE PROMISSORY NOTE
Due June 1, 2023
|
No. ISM 01
|
Issuance Date June 1, 2018
|
This Note is issued by SILVERSUN TECHNOLOGIES, INC., a Delaware corporation (the “Company”), to Info Sys Management, Inc.,, a Oregon corporation (the “Holder”), pursuant to exemptions from registration under the Securities Act of 1933, as amended.
ARTICLE I.
Section 1.01 Principal and Interest. For value received, on June 1, 2018, the Company hereby promises to pay to the order of the Holder in lawful money of the United States of America and in immediately available funds the principal sum of One Million Dollars (US $1,000,000), together with interest on the unpaid principal of this Note at the rate of two percent (2%) per year (computed on the basis of a 365-day year and the actual days elapsed) from the date of this Note until paid.
Section 1.02 Optional Conversion. The Holder may, at its sole and exclusive option, elect to convert, at any time and from time to time, until payment in full of this Note, all of the principal amount of the Note, plus accrued interest, into shares (the “Conversion Shares”) of the Company’s Common Stock, (“Common Stock”), at a price equal to the average closing price of it’s Common Stock for the five (5) trading days immediately preceding the Issuance Date (the “Fixed Conversion Price”).
Section 1.03 Principal and Interest Payments. The principal and interest payments shall be made in sixty (60) equal monthly installments in accordance with the amortization schedule attached hereto.
ARTICLE II.
Events of Default.
Each of the following events, individually or in any combination thereof, shall constitute an “Event of Default”:
|
a.
|
any payment of principal and/or interest under this Note shall not be paid within five (5) Business Days of the date that such payment was due;
|
|
b.
|
a court shall enter a decree or order for relief in respect of the Company in an involuntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar official) of the Company for any substantial part of the property of the Company or ordering the winding up or liquidation of the affairs of the Company, and such decree or order shall remain unstayed and in effect for a period of 60 consecutive days; and
|
|
c.
|
the Company shall commence a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or consent to the entry of an order for relief in an involuntary case under any such law, or consent to the appointment or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar official) of the Company or for any substantial part of the property of the Company, or the Company shall make any general assignment for the benefit of creditors;
|
|
d.
|
an Event Default shall have occurred by the maker of that certain promissory note from the Company to Nellnube dated on or about the date hereof in the original principal amount of Four Hundred Thousand Dollars ($400,000.00), with “Event of Default” having the meaning ascribed to it in such promissory note;
|
|
e.
|
failure by the Company’s transfer agent to issue Common Stock to the Holder within five (5) days of the Company’s receipt of the attached Notice of Conversion from Holder; and/or
|
|
f.
|
failure by the Company for ten (10) days after notice to it to comply with any of its other agreements in the Note.
|
If an Event of Default shall occur, the unpaid principal and accrued interest hereunder shall become immediately due and payable without any declaration or other act on the part of the Holder.
Additionally, immediately upon the occurrence of any Event of Default the Holder, without any notice to the Borrower, which notice is hereby expressly waived by the Borrower, may proceed to protect, enforce, exercise and pursue any and all rights and remedies available to the Holder under this Note and any and all rights and remedies available to the Holder at law and/or in equity.
ARTICLE III.
Section 3.01 Rights and Terms of Conversion. Commencing sixty (60) days after the date hereof, this Note, in whole or in part, may be converted at any time prior to the maturity date of this Note, into shares of Common Stock at a price equal to the Fixed Conversion Price.
ARTICLE IV.
Section 4.01 Adjustment. In the event that the Company shall at any time subdivide the outstanding shares of Common Stock, or shall issue a stock dividend on the outstanding Common Stock, the Conversion Price in effect immediately prior to such subdivision or the issuance of such dividend shall be proportionately decreased, and in the event that the Company shall at any time combine the outstanding shares of Common Stock, the Conversion Price in effect immediately prior to such combination shall be proportionately increased, effective at the close of business on the date of such subdivision, dividend or combination as the case may be.
ARTICLE V.
Section 5.01 Notice. Notices regarding this Note shall be sent to the parties at the following addresses, unless a party notifies the other parties, in writing, of a change of address:
To Company:
000 Xxxxx Xxxx Xxxxxx
East Hanover,NJ 07936
Telephone: (000) 000-0000
Attention: Xxxx Xxxxxx
With copies to:
Lucosky Xxxxxxxx, LLP
000 Xxxx Xxxxxx Xxxxx, 0xx Floor
Iselin, New Jersey 08830
Telephone: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxx, Esq.
To ISM and Stockholder:
Info Sys Management, Inc.
0000 XX Xxxx Xxxxxx, Xxxxx X
Portland, Oregon 97222
Attention: Xxxxx Xxxxx X’Xxxxxx
With copies to:
Xxxxx Xxxxxxx
Xxxxx Xxxxxxx
Section 5.02 Governing Law. This Note shall be deemed to be made under and shall be construed in accordance with the laws of the State of New Jersey without giving effect to the principals of conflict of laws thereof. Each of the parties consents to the jurisdiction of the U.S. District Court sitting in the District of the State of New Jersey or the state courts of the State of New Jersey sitting in Xxxxxx County, New Jersey in connection with any dispute arising under this Note and hereby waives, to the maximum extent permitted by law, any objection, including any objection based on forum non conveniens to the bringing of any such proceeding in such jurisdictions.
Section 5.03 Severability. The invalidity of any of the provisions of this Note shall not invalidate or otherwise affect any of the other provisions of this Note, which shall remain in full force and effect.
Section 5.04 Entire Agreement and Amendments; Assignment. This Note represents the entire agreement between the parties hereto with respect to the subject matter hereof and there are no representations, warranties or commitments, except as set forth herein. This Note may be amended only by an instrument in writing executed by the parties hereto. This Note is freely assignable by the Holder to Xxxxx Xxxxx or his affiliates, heirs and successors, only.
Section 5.05 Counterparts. This Note may be executed in multiple counterparts, each of which shall be an original, but all of which shall be deemed to constitute an instrument.
Section 5.06 Default Interest. From and after an Event of Default under this Note, which default has not been cured within the applicable time period (if any) interest shall thereafter accrue on the then-outstanding principal balance of this Note at the rate of eighteen percent (18.0%) per annum or the highest rate allowed by law, whichever is lower.
Section 5.07 Expenses. The Borrower agrees to pay to the Holder all out-of-pocket expenses (including reasonable expenses for legal services of every kind) of, or incident to, the enforcement of any of the provisions of this Note.
Section 5.08 Miscellaneous. This Note shall be deemed to be a contract under the laws of the State of New Jersey, and for all purposes shall be construed in accordance with the laws of
said state without regard to conflict of law principles. The parties hereto hereby waive presentment, demand, notice, protest and all other demands and notices in connection with the delivery, acceptance, performance and enforcement of or any default under this Promissory Note, except as specifically provided herein, and assent to extensions of the time of payment, or forbearance or other indulgence without notice. The Section headings herein are for convenience only and shall not affect the construction hereof. Any provision of this Note which is illegal, invalid, prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such illegality, invalidity, prohibition or unenforceability without invalidating or impairing the remaining provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction. This Note shall bind the Company and its successors and permitted assigns. The rights under and benefits of this Note shall inure to the Note Holder and its successors and assigns.
IN WITNESS WHEREOF, with the intent to be legally bound hereby, the Company as executed this Note as of the date first written above.
Date: June ___, 2018
|
|
|
|
By: _____________________________
|
|
|
Name: Xxxx Xxxxxx
|
|
|
Title: President and Chief Executive Officer
|
