Amendment No. 2 to the Exclusive Investment Banking Agreement, dated November 23, 2009, by and between Hawk Systems, Inc., and Cresta Capital Strategies, LLC
Exhibit 10.1
UNSECURED PROMISSORY NOTE
Principal Amount: $250,000.00
Issue Date: November 23, 2009
Palm Beach County, Florida
FOR VALUE RECEIVED, Hawk Systems, Inc., a Delaware corporation (the “Borrower”), hereby promises to pay to the order of Cresta Capital Strategies, LLC (the “Lender”), with its principal address at 1175 Walt Whitman Road, Ste. 100, Melville, NY 11747 (Lender and all other or subsequent holders of this Note being sometimes referred to as the “Holder”), the principal sum of Two Hundred Fifty Thousand Dollars ($250,000.00) (the “Loan”) together with interest on the unpaid principal amount until paid in full, upon the following terms:
1.
Interest. The aggregate unpaid principal balance of the Loan shall bear interest at a rate of eight percent (8.0%) per annum (non-compounded) calculated on a 365/366 day year, as applicable.
2.
Payment Terms. The Borrower agrees to pay the unpaid principal balance of this Note and all accrued and unpaid interest on the date that is the earlier of (i) one (1) year from the Issue Date of this Note as set forth above, or (ii) ten (10) business days from the date of closing by Borrower of any equity financing in the aggregate of not less than Two Million Five Hundred Thousand Dollars ($2,500,000) (the “Maturity Date”). Borrower may prepay all or any part of interest or principal at any time without penalty.
3.
Event of Default. The occurrence of any of the following events of default (“Event of Default”) shall, at the option of the Holder hereof, make all sums of principal and interest then remaining unpaid hereon and all other amounts payable hereunder immediately due and payable, upon written demand from Holder, which Event of Default has not been cured within sixty (60) calendar days of receipt by Borrower of such written demand:
(a)
Failure to Pay Principal and Interest. The Borrower fails to pay the entire principal and any accrued and unpaid interest due hereunder on the Maturity Date.
(b)
Bankruptcy. Filing by the Borrower, or their affiliate, of a voluntary petition under the United States Bankruptcy Code, or under any other insolvency act or law, state or federal, now or hereafter existing; or any action indicating the Borrower’s consent to, approval of, or acquiescence in, any such petition or proceeding; or the Borrower’s consent to the appointment of a receiver or trustee for all or a substantial part of their respective properties; or the making of an assignment to the benefit of the creditors on behalf of the Borrower.
(c)
Insolvency Etc. Filing of an involuntary petition against the Borrower under the United States Bankruptcy Code, or under any other insolvency act or law, state or federal, now or hereafter existing; or the involuntary appointment of a receiver or trustee for all or a substantial part of the Borrower's property; or the issuance of a warrant of attachment, execution or similar process against any substantial part of such properties, which remains undismissed, unbonded or undischarged ninety (90) days’ after issuance.
Failure of the Holder, for any period of time or on more than one occasion, to exercise its option to accelerate the Maturity Date shall not constitute a waiver of the right to exercise the same at any time during the continued existence of any Event of Default or any subsequent Event of Default.
4.
Maximum Payments. Nothing contained herein shall be deemed to establish or require the payment of a rate of interest or other charges in excess of the maximum permitted by applicable law. In the event that the rate of interest required to be paid or other charges hereunder exceed the maximum permitted by such law, any payments in excess of such maximum shall be credited against amounts owed by the Borrower to the Holder and thus refunded to the Borrower.
5.
Miscellaneous.
(a)
Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal bus iness hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be: (i) if to the Company, to: Hawk Systems, Inc., 777 South Flagler Drive Suite 800-West Tower, West Palm Beach, Florida 33401, with a copy by telecopier only to: Greenberg Traurig, P.A., 5100 Town Center Circle, Suite 400, Boca Raton, FL 33486, Attn: Bruce C. Rosetto, Esq., Telecopier: (561) 367-6225, and (ii) if to the Holder, at the address of the Holder set forth above.
(b)
Entire Agreement; Assignment. This Note represents the entire agreement between the parties hereto with respect to the subject matter hereof and may be amended only by a writing executed by both parties. Neither the Borrower nor the Holder have relied on any representations not contained or referred to herein. This Note may not be assigned by Holder or Borrower at any time without prior written consent of the other party. This Note will be binding in all respects upon Borrower and inure to the benefit of Holder and its permitted successors and assigns.
(c)
Governing Law. This Note shall be governed by and construed in accordance with the laws of the State of New York without regard to conflicts of laws principles that would result in the application of the substantive laws of another jurisdiction. Any action brought by either party against the other concerning the transactions contemplated by this Note shall be brought only in the civil or state courts of New York or in the federal courts located in Suffolk County, New York. In the event that any provision of this Note or any other agreement delivered in connection herewith is invalid or unenforceable under any applicable statute or rule of law, then such provision 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 such provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of any agreement.
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(d)
Waiver of Jury Trial. TO THE FULLEST EXTENT NOT PROHIBITED BY APPLICABLE LAW THAT CANNOT BE WAIVED, EACH OF THE PARTIES HEREBY WAIVES THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS NOTE. THE PARTIES ACKNOWLEDGE THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS RELIED ON THE WAIVER IN ENTERING INTO THIS NOTE AND THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS. THE PARTIES WARRANT AND REPRESENT THAT THEY EACH HAVE HAD THE OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY IRREVOCABLY WAIVES ITS JURY TRIAL RIGHTS.
(e)
Amendment and Waivers. Any term or provision of this Note may be amended, and the observance of any term of this Note may be waived (either generally or in a particular instance and either retroactively or prospectively) by a writing signed by the Borrower with the consent of the Holder, and such waiver or amendment, as the case may be, shall be binding upon the Borrower and Holder. The waiver by Holder of any breach hereof or default in the performance hereof shall not be deemed to constitute a waiver of any other default or any succeeding breach or default.
(f)
Injunctive Relief, Consent to Jurisdiction. The Holder shall not be entitled to injunctive relief to prevent or cure breaches of the provisions of this Note. Subject to contrary provisions herein, each of the Borrower, Holder and any signatory hereto in his or her personal capacity hereby waives, and agrees not to assert in any such suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such court, that the suit, action or proceeding is brought in an inconvenient forum or that the venue of the suit, action or proceeding is improper. Nothing in this section shall affect or limit any right to serve process in any other manner permitted by law.
[Signature Page Follows]
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IN WITNESS WHEREOF, this Note has been executed and delivered by the Borrower as of the date and year first above written.
Hawk Systems, Inc.
By: _/s/ David Coriaty____________________
Name: David Coriaty
Title: Director
Accepted and Agreed:
By: __/s/ Michael Mirman_________________________
Name: Michael Mirman
Title: President
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