EXHIBIT 10.42
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PROMISSORY NOTE
$___________ May 16, 2000
The undersigned ("Maker"), ENTRADE INC., a Pennsylvania corporation
for value received, and intending to be legally bound hereby, promises to
pay to the order of __________ ("Payee"), at __________________________,
________, _______ _______, or at such other place or places as Payee may
designate in writing, the principal sum of _________________ Dollars
($________), plus interest from the date hereof on the unpaid principal
amount from time to time outstanding hereunder, at fifteen percent (15%)
per annum, with all principal and interest owed hereunder payable in full
on July 16, 2001 (the "Maturity Date").
Interest shall be payable in arrears commencing on August 16, 2000,
and continuing on the sixteenth (16th) day of November and the sixteenth
(16th) day of February, to and including May 16, 2001, with a final payment
of all interest due on the Maturity Date. Interest shall be calculated
based upon a year consisting of 365 days and charged for the actual number
of days elapsed.
This Note may be prepaid by Maker at any time provided however that
such prepayment shall include interest through the date of prepayment on
the outstanding principal balance of the Note, less any amount of interest
previously paid. In the event that Maker enters into a private placement
or a public offering of its securities which yield to Maker gross proceeds
of not less than Thirty Million Dollars and No/100 ($30,000,000), then
notwithstanding anything to the contrary contained herein, the Payee shall
have the right to demand prepayment of this Note, which amount shall be the
outstanding principal balance of the Note, plus all interest accrued but
unpaid up to the date of prepayment.
Maker covenants and agrees with Payee that (a) in the event that
Maker sells any shares of XxxxxXXXXX.xxx, Inc., that it now owns or
hereafter acquires, it will apply the proceeds of such sale to the
prepayment of this Note on a pari passu basis with other notes issued by
the Maker containing a similar covenant (the "Similar Notes") (which
Similar Notes in the aggregate principal amount will not exceed
$4,500,000), and (b) it shall not pledge or otherwise grant a security
interest in any shares of XxxxxXXXXX.xxx, Inc., that it now owns or
hereafter acquires to any other party.
This Note is subject to all of the terms and conditions of the
Agreement, which terms and conditions are hereby made a part of this Note
to the same extent and with the same force and effect as if they were fully
set forth herein.
It is expressly agreed by Maker that time is of the essence hereof,
and it shall be an Event of Default" hereunder if:
(i) Maker shall fail to pay any amount of principal or
interest due hereunder and such failure shall continue for fifteen (15)
days after Payee notifies Maker thereof in writing; or
(ii) Maker is or becomes insolvent or generally fails to pay,
or admits in writing its inability to pay, debts as they become due, or
Maker applies for, consents to or acquiesces in the appointment of a
trustee, receiver or other custodian for Maker or any of its property, or
makes a general assignment for the benefit of creditors, or, in the absence
of such application, consent or acquiescence, a trustee, receiver or other
custodian is appointed for Maker or for a substantial part of Maker's
property and is not discharged within ninety (90) days, or any bankruptcy,
reorganization, debt arrangement, or other case or proceeding under any
bankruptcy or insolvency law is commenced in respect of Maker, and if such
case or proceeding is not commenced in respect of Maker, it is consented to
or acquiesced in by Maker or remains for ninety (90) days undismissed, or
Maker takes any action to authorize, or in the furtherance of, any of the
foregoing; or
(iii) There shall be an Event of Default pursuant to any other
Note issued in conjunction with this Note.
Upon the occurrence and during the continuation of an Event of
Default hereunder, at the option of Xxxxx, the entire unpaid principal
balance hereunder, together with all accrued interest thereon, shall become
immediately due and payable. In addition, Xxxxx shall be entitled to
exercise all rights of Payee hereunder and under applicable law, including
the right to collect from Maker all sums due under this Note.
In addition to the other sums payable hereunder, Xxxxx agrees to pay
to the holder, within fifteen (15) days of demand, all reasonable
attorneys' fees and costs that may be incurred by the holder of this Note
in enforcing any of the terms hereof after an Event of Default.
Except as otherwise provided in this Note or the Agreement, Maker
hereby waives notice of non-payment, notice of dishonor, and protest of any
dishonor, and agrees that its liabilities shall be unconditional without
regard to the liability of any other party and shall not in any manner be
affected by any indulgence, extension of time, renewal, waiver or
modification granted or consented to by the holder hereof. Further, Maker
consents to any and all extensions of time, renewals, waivers, or
modifications that may be granted by the holder hereof with respect to the
payment or other provisions of this Note, and agrees that additional
makers, endorsers, guarantors or sureties may become parties hereto without
notice to Maker and without affecting its liability hereunder.
The holder hereof shall not by any act of omission or commission be
deemed to waive any of its right or remedies hereunder unless such waiver
is in writing and signed by the holder hereof, and then only to the extent
specifically set forth therein. The waiver of any event shall not be
construed as a waiver of any other right or remedy, nor shall any single or
partial exercise of any right or remedy preclude any other or further
exercise thereof or of any other right or remedy.
Whenever possible, each provision of this Note shall be interpreted
in such manner as to be effective and valid under applicable law, but if
any provision of this Note is deemed to be invalid or unenforceable under
such law, such provision shall be ineffective only to the extent of such
invalidity or unenforceability without affecting the validity or
enforceability of any other provision of this Note.
Maker (and the undersigned representative of Maker, if any)
represents that Maker has full power and authority and legal right to
execute and deliver this Note and this Note shall be binding on Maker and
its respective successors and assigns.
This Note shall be governed by and construed according to the
internal laws of the State of Illinois without regard to principals of
conflicts of law.
IN WITNESS WHEREOF, Xxxxx has duly executed this Secured Promissory
Note as of the date first above written.
ENTRADE INC.
By:
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President