PROMISSORY NOTE (NOTE)
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| ||Riverside, California || ||February 21, 2017|
1. Obligation. FOR VALUE RECEIVED, the undersigned, THE REAL GOOD FOOD COMPANY LLC, a California limited liability company (Company), promises to pay to the order of PPZ, LLC, a Wyoming limited liability company, or its permitted assigns (collectively referred to herein as, the Holder) at maturity, a principal sum of Forty Thousand Dollars and Zero Cents ($40,000.00) (Principal), together with all accrued and unpaid interest, at its offices or such other place as the Holder may designate in writing.
2. Interest Rate. From the date of this Note and until this Note is paid in full, interest shall accrue on the outstanding principal balance of this Note at the simple rate of interest of eight percent (8%) per annum (Interest Rate). Interest shall be calculated on the basis of a 360-day year assuming twelve equal 30-day months.
3. Payment Provisions
3.1 Payment at Maturity. The outstanding principal balance plus all accrued and unpaid interest under this Note shall be due and payable to the Holder on February 20, 2019 (Maturity Date).
3.3 Other Payment Provisions. All payments of principal and/or interest shall be payable to the Holder in lawful money of the United States. All payments shall first be applied to accrued and unpaid interest and then to reduce the principal balance of this Note. Except as otherwise provided herein, this Note may not be prepaid at any time without the prior written consent of the Holder.
4. Assignment. The Company may not assign this Note or any of its rights hereunder without the prior written consent of the Holder; provided, however, that in the event of a merger or consolidation of the Company into or with another entity, this Note may be, without the prior written consent of the Holder, and shall be deemed to be, assigned to and assumed by the surviving entity in any such merger or consolidation, which shall thereupon become the Company for purposes of this Note. The Holder may assign this Note without the prior written consent of the Company, to another entity for the purpose converting this Note. The Company or the Holder, as applicable, shall promptly deliver notice of any assignment of this Note or any rights, title or interests in or to this Note by such party, which notice shall include the date of the assignment and the name and address of the assignee.
5. Subordination. This Note shall be subordinated to any and all security interests held by PMC Financial in the assets of the Company, existing before or after the date hereof.
6. Successors and Assigns. Except as otherwise provided herein, any reference to the Holder hereof shall be deemed to include the permitted successors and assigns of such Holder, and all covenants, promises and agreements by or on behalf of the Company that are contained in this Note shall bind and inure to the benefit of the permitted successors and assigns of such Holder and to any future holders of this Note.