NEITHERTHISNOTENORTHESECURITIESTHATMAYBEISSUEDBYTHEBORROWERUPONCONVERSIONHEREOF(COLLECTIVELY,THE“SECURITIES”)HAVEBEENREGISTEREDUNDERTHESECURITIESACTOF1933,ASAMENDED(THE“1933ACT”),ORTHESECURITIESLAWSOFANYSTATEOROTHERJURISDICTION.NEITHERTHESECURITIESNORANYINTERESTORPARTICIPATION THEREINMAYBEOFFERED FORSALE, SOLD,TRANSFERREDOR ASSIGNED: (I)INTHE ABSENCEOFANEFFECTIVEREGISTRATIONSTATEMENTFOR THESECURITIESUNDERTHE1933ACT,ORAPPLICABLESTATE SECURITIESLAWS; OR (II) IN THE ABSENCE OF AN OPINION OF COUNSEL, IN A FORM ACCEPTABLE TO THE ISSUER, THATREGISTRATIONISNOTREQUIREDUNDERTHE 1933ACTOR;(III)UNLESSSOLD,TRANSFERREDORASSIGNED PURSUANT TO RULE 144 UNDER THE 1933 ACT.
8%CONVERTIBLENOTE
MATURITYDATEOFNOVEMBER1,2015*THE“MATURITYDATE”
$150,000MAY1,2015*THE“ISSUANCEDATE”
FORVALUERECEIVED,MaxSoundCorporation,aDelawareCorporation(the“Company”)doingbusinessinSantaMonica,CA,herebypromises to payto theorder of JSJ Investments Inc.,an accredited investorand TexasCorporation, orits assigns (the“Holder”),theprincipalamount ofOneHundred andFiftyThousand Dollars($150,000), ondemand oftheHolder atanytime on orafterNovember1,2015(the“MaturityDate”), andtopayinterestontheunpaidprincipal balance hereof at the rate ofEightPercent(8%) per annum (the“Interest Rate”) from the date hereof (the“Issuance Date”) until the same becomes due and payable, whether at maturity or upon acceleration or by prepayment or otherwise;provided, that any amount of principal or interest on this Note which is not paid when due shall bear interest at such rate on the unpaidprincipal balance hereof plus Default Interest fromthe due date thereof until the same is paid in full.Interest shall commenceaccruing on the Issuance Date,shall be computed on the basis of a 365-day year and the actualnumber of days elapsed andshall accrue daily and, after the Maturity Date, compound quarterly.
1. PaymentsofPrincipalandInterest.
| a. | PaymentofPrincipal.UntiltheNinetieth(90th)dayaftertheIssuanceDatetheCompanymaypaytheprincipalatacashredemptionpremiumof140%,inadditiontooutstandinginterest,withouttheHolder’sconsent;fromthe90thdaytotheOneHundredandTwentieth(120th)dayaftertheIssuanceDate,theCompanymaypaytheprincipalat acashredemptionpremium of150%,in additiontooutstanding interest, without the Holder’s consent. After the 120thday, up to and upon the Maturity Date, this note has a cash redemption premium of 150% of the principal amount, in addition to outstanding interest, but this provision may only be exercised if the consent of the Holder is obtained. After the Maturity Date of NOVEMBER1, 2015theCompanymaynotrepaytheNote,inwholeorinpart,underanycircumstancewithoutobtaining the Holder’s consent. If the Company requests to repay the Note after the Maturity Date and obtains the Holder’s consent to do so, the Company must pay the Note’s outstanding principal at a cash redemption premium of 150%, in addition to outstanding interest. |
| b. | DemandofRepayment.TheprincipalandinterestbalanceofthisNoteshallbepaidtotheHolderhereofondemandbytheHolderatanytimebeforeoraftertheMaturityDate. |
| c. | DefaultInterest.AnyamountofprincipalonthisNotewhichisnotpaidwhendueshallbearEightPercent(8%)interestperannum fromthedatethereofuntilthesame is paid(“DefaultInterest”) andthe Holder,attheHolder’ssolediscretion, mayincludeanyaccruedbutunpaid DefaultInterest inthe Conversion Amount. |
| d. | GeneralPaymentProvisions.ThisNoteshallbemadeinlawfulmoneyoftheUnitedStatesofAmericabychecktosuchaccountastheHoldermayfromtimetotimedesignatebywrittennoticetotheCompanyinaccordancewiththeprovisionsofthisNote.Wheneveranyamountexpressedtobeduebythe |
terms ofthisNoteisdueonanydaywhichisnotaBusinessDay(asdefinedbelow),thesameshallinsteadbedueonthenextsucceedingdaywhichisaBusinessDayand,inthecaseofanyinterestpaymentdatewhichisnotthedateonwhichthisNoteispaidinfull,theextensionoftheduedatethereofshallnotbetakenintoaccountforpurposesofdeterminingtheamountofinterestdueonsuchdate.ForpurposesofthisNote,“BusinessDay”shallmeanany dayotherthanaSaturday,Sundayoradayonwhichcommercialbanksin the State of Texas are authorized or required by law or executive order to remain closed.
| 2. | ConversionofNote.Atanytimepriorto,upon,oraftertheMaturityDate,theConversionAmount(seeparagraph2(a)(i))ofthisNoteshallbeconvertibleintosharesoftheCompany’scommonstock(the“CommonStock”)accordingtotheterms andconditionssetforthinthisParagraph2. |
| a. | CertainDefinedTerms.ForpurposesofthisNote,thefollowingtermsshallhavethefollowingmeanings: |
| i. | “ConversionAmount”meansthesumof(a)theprincipalamountofthisNotetobeconvertedwithrespecttowhichthisdeterminationisbeingmade,(b)Interest;and(c)DefaultInterest,ifany,onunpaidinterestandprincipal,ifsoincludedattheHolder’ssolediscretion. |
| ii. | “ConversionPrice”means:a40%discounttothelowesttradingpriceduringthepreviousten(10)tradingdaystothedateofConversion |
| iii. | “Person”meansanindividual,alimitedliabilitycompany,apartnership,a joint venture,acorporation,atrust,anunincorporatedorganizationandagovernmentoranydepartmentoragencythereof. |
| iv. | “Shares”meanstheSharesoftheCommonStockoftheCompanyintowhichanybalanceonthisNotemaybeconverteduponsubmissionofa“ConversionNotice”attachedheretoasExhibit1. |
| b. | Holder’sConversionRights.AtanytimeortimesonoraftertheIssuanceDate,theHoldershallbeentitledtoconvertalloftheoutstandingandunpaidprincipalamountofthisNoteintofullypaidandnon-assessablesharesofCommonStockinaccordancewiththestatedConversionPrice. |
| c. | FractionalShares.TheCompanyshallnotissueanyfractionofashareofCommonStockuponanyconversion;ifsuchissuancewouldresultintheissuanceofafractionofashareofCommonStock,theCompanyshall round suchfraction ofa shareof CommonStock upto thenearest wholeshare. |
| d. | ConversionAmount.TheConversionAmountshallbeconvertedpursuanttoRule144(b)(1)(ii)andRule144(d)(1)(ii)aspromulgatedbytheSecuritiesandExchangeCommissionundertheSecuritiesActof1933,asamended,intofreetradingsharesattheConversionPrice. |
| e. | MechanicsofConversion.TheconversionofthisNoteshallbeconductedinthefollowingmanner: |
| i. | Holder’sConversionRequirements.To convert thisNote into shares ofCommon Stock on anydatesetforthintheConversionNoticebytheHolder(the“ConversionDate”),theHolderhereofshalltransmitbyemail,facsimileorotherwisedeliver,forreceiptonorpriorto11:59p.m.,EasternTime,onsuchdateoronthenextbusinessday, acopyof afullyexecutednoticeofconversioninthe form attached hereto as Exhibit 1 to the Company. |
| ii. | Company’sResponse.UponreceiptbytheCompanyofacopyofaConversionNotice,theCompanyshallassoonaspracticable,butinnoeventlaterthanone(1)BusinessDayafterreceiptofsuchConversionNotice,send,viaemail,facsimileorovernightcourier,aconfirmationofreceiptofsuchConversionNoticetosuchHolderindicatingthattheCompanywillprocesssuchConversionNoticeinaccordancewiththetermsherein.Withintwo(2)BusinessDaysafterthedate the Conversion Notice is delivered, the Company shall have issued and electronically transferred the shares to the Broker indicated in the Conversion Notice; should the Company be unable to transfer the shares electronically, it shall, within two (2) Business Days after the date the Conversion was delivered, have surrendered to an overnight courier for delivery the next day tothe address as specified in the Conversion Notice, a certificate, registered in the name of the Holder, for the number of shares of Common Stock to which the Holder shall be entitled. |
| iii. | RecordHolder.ThepersonorpersonsentitledtoreceivethesharesofCommonStockissuableuponaconversionofthisNoteshallbetreatedforallpurposesastherecordholderorholdersof such shares of Common Stock on the Conversion Date. |
| iv. | TimelyResponsebyCompany.UponreceiptbyCompanyofaConversionNotice,CompanyshallrespondwithinonebusinessdaytoHolderconfirmingthedetailsoftheConversion,andprovidewithintwobusinessdaystheSharesrequestedintheConversionNotice. |
| v. | PenaltyforDelinquentResponse.IfCompanyfailstodeliverforwhateverreason(includinganyneglectorfailureby,e.g.,theCompany,itscounselorthetransferagent)toHoldertheSharesasrequestedinaConversionNoticeandwithinthree(3)businessdaysoftheConversionDate,theCompanyshallbedeemedin“DefaultofConversion.”Beginningonthefourth(4th)businessday after the date of the Conversion Notice, after the Company is deemed in Default of Conversion, there shallaccrue a penalty (the “ConversionPenalty”)of AdditionalShares due to Holder equal to Twenty-Five percent (25%) of the number stated in the Conversion Notice (the “AdditionalShares”). The Additional Shares shall be issued and the amount of the Note retired will not be reduced beyond that stated in the Conversion Notice.If the Additional Shares owed the Holdercause the Shares requested by the Conversion Notice to exceed 4.9% of the Company’s outstanding shares,the Holdermayopt insteadtohave theConversionAmount reducedbythevalue, as calculated using the Conversion Price, of the Additional Shares owing. Each additionalfive (5) business days beyond the fourth business day after the date of this Notice shall accrue anadditional 25%penaltyfordelinquency, withoutanycorrespondingreductionintheamountdue under the Note, for so long as Company fails to provide the Shares so demanded. At any time after a Default of Conversion the Holder may, at their sole discretion, rescind the Conversion. |
| vi. | RescindmentofConversionNotice.If(i)theCompanyfailstorespondtoHolderwithinonebusinessdayfromthedateofConversionconfirmingthedetailsofConversion,(ii)theCompanyfailstoprovidetheSharesrequestedintheConversionNoticewithinthreebusinessdaysfromthedateofConversion,(iii)theHolderisunabletoprocurealegalopinionrequiredtohavetheSharesissuedunrestrictedand/ordepositedtosellforanyreasonrelatedtotheCompany'sstanding,(iv)the Holder is unable to deposit the Shares requested in the Conversion Notice for any reason related to the Company's standing, or (v) if OTCMarkets changes the Company's designation to 'LimitedInformation'(Yield),'NoInformation'(StopSign),'CaveatEmptor'(SkullandCrossbones), or 'OTC','OtherOTC' or'Grey Market'(ExclamationMark Sign)onthe dayofor anydayafterthe date of Conversion, the Holder maintains the option and sole discretion to rescind the Conversion Notice("Rescindment")witha"NoticeofRescindment.” |
| vii. | TransferAgentFeesandLegalFees.TheissuanceofthecertificatesshallbewithoutchargeorexpensetotheHolder.TheCompanyshallpayanyandallTransferAgentfees,legalfees,andadvisory feesrequired for execution ofthisConvertibleNote andprocessing of anyNoticeofConversion,includingbutnotlimitedtothecostofobtainingalegalopinionwithregardtotheConversion.TheHolderwilldeduct$3,000fromtheprincipalpaymentoftheConvertibleNotesolelytocover thecost of obtainingany andall legal opinionsrequiredtoobtaintheShares requestedinanygivenConversionNotice.Thesefeesdonotmakeprovisionfororsufficeto defray any legal fees incurred in collection or enforcement of the Note as described in Paragraph13. |
| viii. | ConversionRightUnconditional.IftheHoldershallprovideaNoticeofConversionasprovidedherein,theCompany’sobligationstodeliverCommonStockshallbeabsoluteandunconditional,irrespectiveofanyclaimofsetoff,counterclaim,recoupment,orallegedbreachbytheHolderofanyobligationtotheCompany. |
| 3. | Other Rights of Holders:Reorganization, Reclassification,Consolidation,Merger or Sale.Anyrecapitalization,reorganization,reclassification,consolidation,merger,saleofallorsubstantiallyalloftheCompany’sassetstoanotherPersonorothertransactionwhichiseffectedinsuchawaythatholdersofCommonStockareentitledtoreceive(eitherdirectlyoruponsubsequentliquidation)stock,securitiesorassetswithrespecttoorinexchangeforCommonStockisreferredtohereinas“OrganicChange.”Priorto the consummation of any (i) Organic Change or (ii) other Organic Change following which the Companyis not a surviving entity, the Company will secure from the Person purchasing such assets or the successor resulting from such Organic Change (in each case, the “Acquiring Entity”) a written agreement (in form and substance reasonably satisfactory to the Holder) to deliver to Holder in exchange for this Note, a security of the Acquiring Entity evidenced by a written instrument substantially similar in formandsubstancetothis Note, andreasonablysatisfactorytotheHolder. Prior totheconsummationofanyotherOrganic Change, the Company shall make appropriate provision (in form and substance reasonably |
satisfactorytotheHoldersofamajorityoftheConversionAmountoftheNotesthenoutstanding)toensurethateachoftheHolderswillthereafterhavetherighttoacquireandreceiveinlieuoforinadditionto(asthecasemaybe)thesharesofCommon Stock immediately theretofore acquirable and receivable upon the conversion ofsuch Holder’s Note,suchshares ofstock, securitiesor assetsthat would have been issuedor payable in such Organic Change with respect to or in exchange for the number of shares of Common Stock which would have been acquirable and receivable upon the conversion of such Holder’s Note as of the date of such Organic Change (without taking into accountanylimitationsorrestrictionsontheconvertibilityoftheNote).AllprovisionsofthisNotemustbeincluded to the satisfactionof Holderin any newNote created pursuantto thissection.
| 4. | RepresentationsandWarrantiesoftheCompany.Inconnectionwiththetransactionsprovidedforherein,theCompanyherebyrepresentsandwarrantstotheHoldersthefollowing. |
| a. | Organization,GoodStandingandQualification.TheCompanyisacorporationdulyorganized,validlyexistingandingoodstandingunderthelawsofthestateofitsincorporationandhasallrequisitecorporate |
powerandauthoritytocarryonitsbusinessasnowconducted.TheCompanyisdulyqualifiedtotransactbusinessandisingoodstandingineachjurisdictioninwhichthefailuretosoqualifywouldhaveamaterialadverseeffectonitsbusinessorproperties.
| b. | Authorization.AllcorporateactionhasbeentakenonthepartoftheCompany,itsofficers,directorsandstockholdersnecessaryfortheauthorization,executionanddeliveryofthisAgreement.TheCompanyhastakenallcorporateactionrequiredtomakealloftheobligationsoftheCompanyreflectedintheprovisionsofthisAgreement,validand enforceableobligations. Theshares of capitalstock issuableupon conversionoftheNoteshavebeenauthorizedorwillbeauthorizedpriortotheissuanceofsuchshares. |
| c. | FiduciaryObligations.TheCompanyherebyrepresentsthatitintendstousetheproceedsoftheNotesprimarilyfortheoperationsofitsbusinessandnotforanypersonal,family,orhouseholdpurpose.TheCompanyherebyrepresentsthatitsboardofdirectors,intheexerciseofitsfiduciaryduty,hasapprovedtheexecutionofthisAgreementbaseduponareasonablebeliefthattheloanprovidedforhereinisappropriate for the Company after reasonable inquiry concerning its financial objectives and financial situation. |
| 5. | ReservationofShares.TheCompanyshallatalltimes,solongasanyprincipalamountoftheNoteisoutstanding,reserveandkeepavailableoutofitsauthorizedandunissuedCommonStock,solelyforthepurposeofeffectingtheconversionoftheNote,suchnumberofsharesofCommonStockasshallatalltimesbesufficienttoeffecttheconversionofalloftheprincipalamountoftheNotethenoutstanding.TheinitialnumberofsharesofCommonStock reservedfor conversionsof theNotes shall becalculatedasfour times thenumber of shares necessary toconvert the entire value of the Note on the day it was executed, unless the Holder stipulates otherwise in the “Irrevocable Letter of Instructions to the Transfer Agent,” and each increase in the number of shares so reserved shall beallocatedprorataamong theHoldersoftheNote basedontheprincipaland interestamountoftheNotes heldby each Holder at the time of issuanceof the Notes or increasein the numberof reserved shares,as the case may be. In theeventaHoldershallsellorotherwisetransferanyofsuchHolder’sNote,eachtransfereeshallbeallocatedaprorataportionofthenumberofreservedsharesofCommonStockreservedforsuchtransferor.Anysharesof Common Stock reserved and allocated to any Person which ceases to hold any Note shall be allocated to the remaining Holders, pro rata based on the principal amount of the Note then held by such Holders. |
| 6. | VotingRights.HoldersofthisNoteshallhavenovotingrights,exceptasrequiredbylaw. |
| 7. | ReissuanceofNote.IntheeventofaconversionorredemptionpursuanttothisNoteoflessthanalloftheConversionAmountrepresentedbythisNote,theCompanyshallpromptlycausetobeissuedanddeliveredtotheHolder,upontenderbytheHolderoftheNoteconvertedorredeemed,anewnoteofliketenorrepresentingtheremainingprincipalamountofthisNotewhichhasnotbeensoconvertedorredeemedand which is in substantially the sameformasthisNote,assetforthabove. |
| a. | EventofDefault.An“EventofDefault”is:(i)defaultforten(10)daysinpaymentofinterestorDefaultInterestonthisNote;(ii)defaultinpaymentoftheprincipalamountofthisNotewhendue;(iii)failurebytheCompanyforthirty(30)daysafternoticetoittocomplywithanyothermaterialprovisionofthisNote; |
(iv)breachofanycovenants,warranties,orrepresentationsbytheCompanyherein;(v)cessationofoperationsbytheCompanyoramaterialsubsidiary;(vi)iftheCompanypursuanttoorwithinthemeaningofanyBankruptcyLaw;(A)commencesavoluntarycase;(B)consentstotheentryofanorderforreliefagainstitinaninvoluntarycase;(C)consentstotheappointmentofaCustodianofitorforallorsubstantiallyallofitsproperty;(D)makesageneral
assignmentfor the benefitof itscreditors; or (E)admitsinwritingthatitisgenerallyunabletopayitsdebtsasthesamebecomedue;or(vi)acourtofcompetentjurisdictionentersanorderordecreeunderanyBankruptcyLawthat: (I)isforreliefagainsttheCompanyinaninvoluntarycase;(2)appointsaCustodianoftheCompanyorforallorsubstantiallyallofitsproperty;or
(3)orderstheliquidationoftheCompanyoranysubsidiary,andtheorderordecreeremainsunstayedandineffectforthirty(30)days.TheTerm“BankruptcyLaw”meansTitle11,U.S.Code,oranysimilarFederalorStateLawforthereliefofdebtors.Theterm“Custodian”meansanyreceiver,trustee,assignee,liquidatororsimilar officialunder any Bankruptcy Law.
| b. | Remedies.IfanEventofDefaultoccursandiscontinuing,theHolderofthisNotemaydeclareallofthisNote,includinganyinterestandDefaultInterestandotheramountsdue,tobedueandpayableimmediately. |
| 9. | VotetoChangetheTermsofthisNote.ThisNoteandanyprovisionhereofmayonlybeamendedbyaninstrumentinwritingsignedbytheCompanyandholdersofamajorityoftheaggregateConversionAmountoftheNotesthenoutstanding. |
| 10. | LostorStolenNote.UponreceiptbytheCompanyofevidencesatisfactorytotheCompanyoftheloss,theft,destructionormutilationofthisNote,and,inthecaseofloss,theftordestruction,ofanindemnificationundertakingbytheHoldertotheCompanyinaformreasonablyacceptabletotheCompanyand,inthecaseofmutilation,uponsurrenderandcancellationoftheNotes,theCompanyshallexecuteanddeliveranewNoteofliketenoranddateandinsubstantiallythesameformasthisNote;provided,however,theCompanyshallnotbeobligatedto re-issue aNote iftheHoldercontemporaneouslyrequeststheCompany toconvert such remainingprincipal amount intoCommon Stock. |
| 11. | PaymentofCollection,EnforcementandOtherCosts.If:(i)thisNoteisplacedinthehandsofanattorneyforcollectionorenforcementoriscollectedorenforcedthroughanylegalproceeding;or(ii)anattorneyisretainedtorepresenttheHolderofthisNoteinanybankruptcy,reorganization,receivershiporotherproceedingsaffectingcreditors’rightsandinvolvingaclaimunderthisNote,thentheCompanyshallpaytotheHolderallreasonable attorneys’fees,costsandexpensesincurredinconnectiontherewith,inadditiontoallotheramountsduehereunder. |
| 12. | Cancellation.AfterallprincipalandaccruedinterestatanytimeowedonthisNotehasbeenpaidinfull,thisNoteshallautomaticallybedeemedcanceled,shallbesurrenderedtotheCompanyforcancellationandshallnotbereissued. |
| 13. | WaiverofNotice.Totheextentpermittedbylaw,theCompanyherebywaivesdemand,notice,protestandallotherdemandsandnoticesinconnectionwiththedelivery,acceptance,performance,defaultorenforcementofthisNote. |
| 14. | GoverningLaw.ThisNoteshallbeconstruedandenforcedinaccordancewith,andallquestionsconcerningtheconstruction,validity,interpretationandperformanceofthisNoteshallbegovernedby,thelawsoftheStateofTexas,withoutgivingeffecttoprovisionsthereofregardingconflictoflaws.Eachpartyherebyirrevocablysubmitstothenon-exclusivejurisdictionofthestateandfederalcourtssittinginTexasfortheadjudicationofanydisputehereunder orin connectionherewith orwithanytransactioncontemplatedherebyordiscussedherein,andherebyirrevocablywaives,andagreesnottoassertinanysuit,actionorproceeding,anyclaimthatitisnotpersonallysubjecttothejurisdictionofanysuchcourt,thatsuchsuit,actionorproceedingisbroughtinaninconvenientforumorthatthevenueof suchsuit,action orproceeding is improper. Eachpartyherebyirrevocablywaivespersonalservice ofprocessand consents to process being served in any such suit, action or proceeding by sending by certified mail orovernight courieracopythereoftosuchpartyattheaddressforsuchnoticestoitunderthisAgreementandagreesthatsuch service shall constitute good and sufficient service of process and notice thereof. Nothing containedhereinshallbedeemedtolimitinanywayanyrighttoserveprocessinanymannerpermitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN |
CONNECTION HEREWITH ORARISINGOUT OF THISAGREEMENTORANY TRANSACTIONCONTEMPLATEDHEREBY.
| 15. | Remedies,Characterizations,OtherObligations,BreachesandInjunctiveRelief.TheremediesprovidedinthisNoteshallbecumulativeandinadditiontoallotherremediesavailableunderthisNote,atlaworinequity(includinga |
decreeofspecificperformanceand/orotherinjunctiverelief),andnoremedycontainedhereinshallbedeemedawaiverofcompliancewiththeprovisionsgivingrisetosuchremedyandnothinghereinshalllimitaHolder’srighttopursueactualdamagesforanyfailurebytheCompanytocomplywiththetermsofthisNote.TheCompanycovenantstoeachHolderofNotesthatthereshallbenocharacterizationconcerning thisinstrumentotherthanas expresslyprovidedherein. Amountsset forthorprovidedforhereinwithrespect topayments, conversionandthe like(andthecomputationthereof)shallbetheamountstobereceivedbytheHolderthereofandshallnot,exceptasexpressly providedherein, besubject toanyotherobligation oftheCompany(ortheperformancethereof).
| 16. | SpecificShallNotLimitGeneral;Construction.NospecificprovisioncontainedinthisNoteshalllimitormodifyanymoregeneralprovisioncontainedherein.ThisNoteshallbedeemedtobejointlydraftedbytheCompanyandallHoldersand shallnot be construedagainst any person as thedrafter hereof. |
| 17. | FailureorIndulgenceNotWaiver.NofailureordelayonthepartofthisNoteintheexerciseofanypower,rightorprivilegehereundershalloperateasawaiverthereof,norshallanysingleorpartialexerciseofanysuchpower,rightor privilege preclude otherorfurtherexercisethereoforofany otherright,power or privilege. |
| 18. | PartialPayment.IntheeventofpartialpaymentbytheHolder,theprincipalsumduetotheHoldershallbeproratedbasedontheconsiderationactuallypaidbylendersuchthatthecompanyisonlyrequiredtorepaytheamountfundedandthecompanyisnotrequiredtorepayanyunfundedportionofthisnote. |
| 19. | EntireAgreement.ThisAgreementconstitutesthefullandentireunderstandingandagreementbetweenthepartieswithregardtothesubjectsherein.NoneofthetermsofthisAgreementcanbewaivedormodified,exceptbyanexpressagreementsignedbytheParties. |
| 20. | RepresentationsandWarranties.TheCompanyexpresslyacknowledgesthattheHolder,includingbutnotlimitedtoits officer, directors, employees,agents, and affiliates, have not made any representationor warrantyto it outside thetermsofthisAgreement.TheCompanyfurtheracknowledgesthattherehavebeennorepresentationsorwarrantiesaboutfuturefinancingorsubsequenttransactionsbetweentheparties. |
| 21. | Notices.AllnoticesandothercommunicationsgivenormadetotheCompanypursuantheretoshallbeinwriting(includingfacsimileorsimilarelectronictransmissions)andshallbedeemedeffectivelygiven:(i)uponpersonaldelivery,(ii)whensentbyelectronicmailorfacsimile,asdeemedreceivedbythecloseofbusinessonthedatesent, |
(iii) five(5)daysafterhavingbeensentbyregisteredorcertifiedmail,returnreceiptrequested,postageprepaidor
(iv) one(1)dayafterdepositwithanationallyrecognizedovernightcourier, specifyingnext daydelivery.Allcommunicationsshallbesenteitherbyemail,orfax,ortotheaddressspecifiedonthesignaturepage.Thephysicaladdress,emailaddress,andphonenumberprovidedonthesignaturepageshallbeconsideredvalidpursuanttotheabovestipulations;shouldtheCompany’scontactinformationchangefromthatlistedonthesignaturepage,itisincumbentontheCompanytoinform theHolder.
| 22. | Severability.IfoneormoreprovisionsofthisAgreementareheldtobeunenforceableunderapplicablelaw,suchprovisionshallbeexcludedfromthisAgreementandtherestoftheAgreementshallbeenforceableinaccordancewithitsterms. |
| 23. | Usury.Ifitshallbefoundthatanyinterestorotheramountdeemedinterestduehereunderviolatestheapplicablelawgoverningusury,theapplicablerateofinterestduehereundershallautomaticallybeloweredtoequalthemaximumrateofinterestpermittedunderapplicablelaw.TheCompanycovenants(totheextentthatitmaylawfullydoso)thatitwillnotseektoclaimortakeadvantageofanylawthatwouldprohibitorforgivetheCompanyfrompayingalloraportionoftheprincipalorinterestonthisNote. |
| 24. | SuccessorsandAssigns.ThisAgreementshallbebinding uponsuccessorsandassigns. |
—SIGNATUREPAGETOFOLLOW—
INWITNESSWHEREOF, theCompanyhascausedthisNotetobesignedbyitsCEO,onandasoftheIssuanceDate.
COMPANY
Signature:
John Blaisure
By:
CEO
Title:
2902 a Colorado Ave
Address:
Santa Monica Ca 90404
Email:
Phone:
JSJInvestmentsInc.
Signature:
SameerHirji,PresidentJSJInvestmentsInc.
6060NorthCentralExpressway,Suite500
DallasTX75206
888-503-2599
Exhibit1
ConversionNotice
Referenceismadetothe8%ConvertibleNoteissuedbyMaxSoundCorporation(the"Note"),datedMay1,2015intheprincipalamountof$150,000with8%interest.Thisnotecurrentlyholdsaprincipalbalanceof$150,000.ThefeaturesofconversionstipulateaConversionPriceofa40%discounttothelowesttradingpriceduringthepreviousten(10)tradingdaysto the date of Conversion,pursuant to the provisions of Section2(a)(2) in the Note.
InaccordancewithandpursuanttotheNote,theundersignedherebyelectstoconvert$oftheprincipal/interestbalanceoftheNote,indicatedbelowintosharesofCommonStock(the"CommonStock"),oftheCompany,bytenderingtheNotespecifiedasofthedatespecifiedbelow.
DateofConversion:
Pleaseconfirmthefollowinginformation:ConversionAmount:$
ConversionPrice:$(%discountfrom$)
NumberofCommonStocktobeissued:CurrentIssued/Outstanding:
IftheIssuerisDWACeligible,pleaseissuetheCommonStockintowhichtheNoteisbeingconvertedinthenameoftheHolderoftheNoteandtransfertheshareselectronicallyto:
[BROKERINFORMATION]
HolderAuthorization:
JSJInvestmentsInc.
6060NorthCentralExpressway,Suite500 *Donotsendcertificatestothisaddress
Dallas,TX75206
888-503-2599
TaxID:20-2122354
SameerHirji,President
[DATE]
[CONTINUEDONNEXTPAGE]
PLEASEBEADVISED,pursuanttoSection2(e)(2)oftheNote,“UponreceiptbytheCompanyofacopyoftheConversionNotice,theCompanyshallassoonaspracticable,butinnoeventlaterthanone(1)BusinessDayafterreceiptofsuchConversionNotice,SEND,VIAEMAIL,FACSIMILEOROVERNIGHTCOURIER,ACONFIRMATIONOFRECEIPTOFSUCHCONVERSIONNOTICETOSUCHHOLDERINDICATINGTHATTHECOMPANYWILLPROCESSSUCHCONVERSIONNOTICE
inaccordancewiththetermsherein.Withintwo(2)BusinessDaysafterthedateoftheConversionConfirmation,theCompanyshallhaveissuedandelectronicallytransferredthesharestotheBrokerindicatedintheConversionNotice;shouldtheCompanybeunabletotransfertheshareselectronically,theyshall,withintwo(2)BusinessDaysafterthedateoftheConversionConfirmation,havesurrenderedtoFedExfordeliverythenextdaytotheaddressasspecifiedintheConversionNotice, acertificate,registeredinthenameof theHolder, forthenumberof sharesof CommonStocktowhichtheHolder shall be entitled.”
Signature:
JohnBlaisure
CEO
MaxSoundCorporation
