THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE. THE
SECURITIES MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED
OF WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, AND UNDER ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF
COUNSEL FOR THE COMPANY THAT THE PROPOSED TRANSACTION WILL BE EXEMPT FROM SUCH
REGISTRATION.
PROMISSORY NOTE
November __, 1999
$1,000,000.00
San Jose, California
For value received, TOPTEAM, INC., a Delaware corporation ("Maker"), promises to
pay to the order of EMARKETPLACE, INC., a Delaware corporation ("Payee"), at 255
West Julian Street, Suite 100, San Jose, California 95110, or at such other
location as Payee may from time to time designate, the principal sum of One
Million and no/100 Dollars ($1,000,000.00), or so much thereof as shall be
outstanding from time to time, together with interest thereon from the date
hereof until this Note has been paid in full on the terms and conditions
contained herein.
1. Interest shall be computed, and principal and interest shall be due
and payable, as follows:
(a) Interest shall accrue on the outstanding principal balance
hereunder at a per annum rate equal to the lesser of (i) seven percent
and (ii) the highest annual rate which may lawfully be charged and
collected under applicable law on the obligations evidenced by this
Note. Interest hereunder shall be computed on the basis of a 365-day
year and actual days elapsed.
(b) Installments of interest shall be payable on the first day of
each month during the term of this Note.
(c) The entire unpaid principal balance, together with all
accrued and unpaid interest, shall be due and payable on the second
anniversary of the date of this Note (the "Maturity Date"). All accrued
and unpaid interest shall be due and payable on the Maturity Date.
2. All payments shall be applied first to interest on the outstanding
principal balance at the interest rate stated in this Note and any balance shall
then be applied to reduction of principal, and interest shall thereafter cease
on the principal so paid. Principal and interest shall be payable in lawful
money of the United States.
3. Maker shall have the right to prepay this Note, at any time, in
whole or in part, at a prepayment price equal to the principal being prepaid
plus accrued interest thereon, without any premium or penalty. This Note shall
be subject to mandatory prepayment in whole at a prepayment price equal to the
outstanding principal of this Note plus accrued interest thereon, without any
premium or penalty, on the date of closing of an initial public offering of the
Common Stock pursuant to a registration statement under the Securities Act of
1933 in a transaction that generates gross proceeds of not less than
$25,000,000.
4. The occurrence of any of the following shall constitute an "Event of
Default" hereunder:
(a) Default in the payment of any installment of interest or
principal on this Note when due or in the performance of any other
obligation of Maker hereunder pursuant to the terms hereof.
(b) The filing by Debtor of any petition for relief under any
applicable bankruptcy or insolvency law.
Upon the occurrence of any such Event of Default, then in addition to
all other rights and remedies set forth herein, or at law or in equity, the
entire unpaid balance of principal on this Note, together with all accrued
interest thereon may be declared by Payee to be immediately due and payable
without notice to Maker.
5. If this Note is not paid when due or if an Event of Default occurs,
Maker promises to pay all costs of collection, including, but not limited to,
reasonable attorneys' fees incurred by Payee on account of such collection,
whether or not suit is filed hereon.
6. Except as expressly provided herein, Maker waives presentment,
demand, notice, protest and all other demands or notices in connection with the
delivery, acceptance, endorsement, performance, default, or enforcement of this
Note, assents to any and all extensions or postponements of the time of payment
or any other indulgence, to any substitution, exchange, or release of security,
or to the addition or release of any other party or person primarily or
secondarily liable.
7. This Note shall be governed by and construed in accordance with the
laws of the State of California.
8. Reference in this Note to "Payee" shall mean the original Payee
hereunder so long as such payee shall be the Payee of this Note and thereafter
shall mean any subsequent Payee of this Note.
9. Time is of the essence of each obligation of Maker hereunder.
10. No delay or omission on the part of Payee in exercising any rights
hereunder, or any other instrument given to secure this Note, whether before or
after a default or Event of Default hereunder or under said instruments, shall
operate as a waiver of such right or default or Event of
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Default or of any other right hereunder or under said instruments, and the
acceptance at any time by Payee of any past-due amounts shall not be deemed to
be a waiver of the right to require prompt payment when due of any other amounts
then or thereafter due and payable hereunder or thereunder.
11. In the event that any provision of this Note shall become declared
inoperable by any Court or become inoperable as a result of any law or ruling
hereafter adopted by any governmental authority, the remainder of its terms
shall remain in full force and effect and modification of the terms hereof
required by law shall apply as though the same were an original term or
condition hereof.
12. The remedies of Payee as provided herein or at law or in equity,
shall be cumulative and concurrent, and may be pursued singly, successively, or
together at the sole discretion of Payee.
13. Maker may not assign its duties and obligations under this Note
without the prior written consent of Payee, which consent may be given or denied
in Payee's sole and absolute discretion. Payee may not assign its rights, duties
and obligations under this Note to any person or entity, other than an affiliate
of Payee, without the prior written consent of Maker, which consent may be given
or denied in Maker's sole and absolute discretion.
MAKER: TOPTEAM, INC.
By: /s/ ROBERT WALLACE
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Robert Wallace, Chairman
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