THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), OR UNDER THE SECURITIES LAWS OF APPLICABLE STATES.
THIS NOTE IS SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY
NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND THE
APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE
FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE
ISSUER OF THIS NOTE MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR
RESALE IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES
LAWS.
PROMISSORY ▇▇▇▇
OF
BLACK NICKEL ACQUISITION CORP II
Note No. 1
$ 16,000 Made as of March 5, 2007
Maturity Date September 5, 2007
For value received, the undersigned, BLACK, NICKEL ACQUISITION CORP II, a
Georgia corporation (the "COMPANY"), hereby promises to pay to the order
of PEF Advisors, LLC (the "LENDER"), or its registered assigns, at the
offices of the Company located at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇, or at such other place as may be designated from
time to time in writing by the Lender, the principal sum of SIXTEEN
THOUSAND DOLLARS ($16,000), or, if less, the aggregate unpaid principal
amount outstanding on this Note as of the Maturity Date, together with
interest on the unpaid principal balance at an annual rate equal to 10%,
computed on the basis of the actual number of days elapsed and a year of
365 days from the date of this Note until the principal amount and all
interest accrued thereon and all other amounts owed hereunder are paid.
The unpaid Principal ▇▇▇▇▇▇, together with any then unpaid accrued
interest and all other amounts owed hereunder, shall be due and payable on
the earlier of (i) at the closing of a reverse merger, share exchange or
similar business combination (the "REVERSE MERGER"), (ii) October 27, 2007
or (iii) an event of default as set forth herein (in the case of (i), (ii)
or (iii), the "MATURITY DATE") at the principal offices of the Company
or by mail to the address of the registered holder of this Note in lawful
money of the United States. The following is a statement of the rights of
▇▇▇▇▇▇ and the conditions to which this Note is subject, and to which
Holder hereof, by the acceptance of this Note, agrees:
1. DEFINITIONS. The following definitions shall apply for all
purposes of this Note:
1.1 "CLOSING" means date on which the purchase and sale of the
Note occurs.
1.2 "COMPANY" means the "COMPANY" as defined above and includes
any corporation which shall succeed to or assume the obligations of the Company
under this Note.
1.3 "HOLDER" means any person who shall at the time be the
registered holder of this Note.
1.4 "NOTE" means this Promissory Note.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to Holder that the statements in the following
paragraphs of this Section 2 are all true and complete as of immediately prior
to the Closing:
2.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION. The Company
has been duly incorporated and organized, and is validly existing in good
standing, under the laws of the State of Georgia. The Company has the corporate
power and authority to own and operate its properties and assets and to carry on
its business as currently conducted and as presently proposed to be conducted.
2.2 DUE AUTHORIZATION. All corporate action on the part of the
Company's directors and shareholders necessary for the authorization, execution,
delivery of, and the performance of all obligations of the Company under the
Note and for the sale and issuance of the Shares has been taken or will be taken
prior to the Closing, and the Note when executed and delivered, will constitute,
a valid and legally binding obligation of the Company, enforceable in accordance
with its terms, except as may be limited by (i) applicable bankruptcy,
insolvency, reorganization or other laws of general application relating to or
affecting the enforcement of creditor's rights generally and (ii) the effect of
rules of law governing the availability of equitable remedies.
2.3 NONCONTRAVENTION. Neither the execution and the delivery of
the Note, nor the consummation of the transactions contemplated hereby nor the
sale and issuance of the Shares, will (a) violate any injunction, judgment,
order, decree, ruling, charge, or other restriction of any government,
governmental agency, or court to which the Company is subject or any provision
of its Certificate of Incorporation or Bylaws, as amended, or (b) conflict with,
result in a breach of, constitute a default under, result in the acceleration
of, create in any party the right to accelerate, terminate, modify, or cancel,
any agreement, contract, lease, license, instrument, or other arrangement to
which the Company is a party or by which it is bound or to which any of its
assets is subject.
2.4 CORPORATE POWER. The Company has the corporate power and
authority to execute and deliver this Note to be purchased by the Holder
hereunder, to issue the Note and to carry out and perform all its obligations
under the Note as well as to issue the Shares.
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2.5 VALID ISSUANCE.
(a) The Note and the Shares, when issued, sold and
delivered in accordance with the terms of this Note for the consideration
provided for herein, will be duly and validly issued, fully paid and
nonassessable.
(b) Based in part on the representations made by the
Holder in Section (b) hereof, the offer and sale of the Note and the Shares
solely to the Holder in accordance with the terms herein are exempt from the
registration and prospectus delivery requirements of the U.S. Securities Act of
1933, as amended (the "1933 ACT") and the securities registration and
qualification requirements of the currently effective provisions of the
securities laws of the states in which the Holder is a resident based upon the
address set forth herein.
(c) REPRESENTATIONS, WARRANTIES AND CERTAIN AGREEMENTS OF
HOLDER. Holder hereby represents and warrants to, and agrees with, the Company,
that:
2.6 AUTHORIZATION. This Note constitutes such Holder's valid
and legally binding obligation, enforceable in accordance with its terms except
as may be limited by (i) applicable bankruptcy, insolvency, reorganization or
other laws of general application relating to or affecting the enforcement of
creditors' rights generally and (ii) the effect of rules of law governing the
availability of equitable remedies. Holder represents that such Holder has full
power and authority to enter into this Note.
2.7 PURCHASE FOR OWN ACCOUNT. The Note and the Shares
(collectively, the "SECURITIES") will be acquired for investment for such
▇▇▇▇▇▇'s own account, not as a nominee or agent, and not with a view to the
public resale or distribution thereof within the meaning of the 1933 Act, and
such Holder has no present intention of selling, granting any participation in,
or otherwise distributing the same.
2.8 DISCLOSURE OF INFORMATION. Such Holder has received or has
had full access to all the information it considers necessary or appropriate to
make an informed investment decision with respect to the Securities. Such
Holder further has had an opportunity to ask questions and receive answers from
the Company regarding the terms and conditions of the offering of the Securities
and to obtain additional information (to the extent the Company possessed such
information or could acquire it without unreasonable effort or expense)
necessary to verify any information furnished to such Holder or to which such
Holder had access. The foregoing, however, does not in any way limit or modify
the representations and warranties made by the Company in Section 2.
2.9 INVESTMENT EXPERIENCE. Such Holder understands that the
purchase of the Securities involves substantial risk. Such Holder (i) has
experience as an investor in securities of companies in the development stage
and acknowledges that such ▇▇▇▇▇▇ is able to fend for itself, can bear the
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economic risk of such ▇▇▇▇▇▇'s investment in the Securities and has such
knowledge and experience in financial or business matters that such ▇▇▇▇▇▇ is
capable of evaluating the merits and risks of this investment in the Securities
and protecting its own interests in connection with this investment and/or (ii)
has a preexisting personal or business relationship with the Company and certain
of its officers, directors or controlling persons of a nature and duration that
enables such Holder to be aware of the character, business acumen and financial
circumstances of such persons.
2.10 ACCREDITED INVESTOR STATUS. Such Holder is an "accredited
investor" within the meaning of Regulation D promulgated under the 1933 Act and
is able to bear the economic risk of holdings the Securities for an indefinite
period.
3. NO RIGHTS OR LIABILITIES AS STOCKHOLDER. This Note does not by
itself entitle the Holder to any voting rights or other rights as a stockholder
of the Company. No provisions of this Note, and no enumeration herein of the
rights or privileges of the Holder, shall cause the Holder to be a stockholder
of the Company for any purpose, other than the issuance to Holder of the Shares
as contemplated hereunder.
4. NO IMPAIRMENT. The Company will not, by amendment of its
Certificate of Incorporation or Bylaws, or through reorganization,
consolidation, merger, dissolution, issue or sale of securities, sale of assets
or any other voluntary action, willfully avoid or seek to avoid the observance
or performance of any of the terms of this Note, but will at all times in good
faith assist in the carrying out of all such terms and in the taking of all such
action as may be necessary or appropriate in order to protect the rights of the
Holder under this Note against wrongful impairment.
5. EVENTS OF DEFAULT. Each of the following events or occurrences
shall constitute an "Event of Default".
(a) NON-PAYMENT OF OBLIGATIONS. (i) the Company shall
default in the payment of any principal of the Note when due, or (ii) the
Company shall default (and such default shall continue unremedied for a period
of three (3) business days after demand for payment) in the payment when due of
any interest amount on the Note.
(b) BREACH OF WARRANTY. Any representation or warranty
of the Company made or deemed to be made hereunder in connection with this Note
is or shall be incorrect when made in any material respect.
(c) The Company shall fail to observe or perform any
other covenant, agreement or warranty contained in, or otherwise commits any
material breach of any of this Note.
(d) The Company or any of its active subsidiaries shall
commence, or there shall be commenced against the Company or any such active
subsidiary a case under any applicable bankruptcy or insolvency laws as now or
hereafter in effect or any successor thereto, or the Company commences any other
proceeding under any reorganization, arrangement, adjustment of debt, relief of
debtors, dissolution, insolvency or liquidation or similar law of any
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jurisdiction whether now or hereafter in effect relating to the Company or any
active subsidiary thereof or there is commenced against the Company or any
active subsidiary thereof any such bankruptcy, insolvency or other proceeding
which remains undismissed for a period of 60 days; or the Company or any active
subsidiary thereof is adjudicated insolvent or bankrupt; or any order of relief
or other order approving any such case or proceeding is entered; or the Company
or any active subsidiary thereof suffers any appointment of any custodian or the
like for it or any substantial part of its property which continues undischarged
or unstayed for a period of 60 days; or the Company or any active subsidiary
thereof makes a general assignment for the benefit of creditors; or the Company
shall fail to pay, or shall state that it is unable to pay, or shall be unable
to pay, its debts generally as they become due; or the Company or any active
subsidiary thereof shall call a meeting of its creditors with a view to
arranging a composition, adjustment or restructuring of its debts; or the
Company or any active subsidiary thereof shall by any act or failure to act
expressly indicate its consent to, approval of or acquiescence in any of the
foregoing; or any corporate or other action is taken by the Company or any
active subsidiary thereof for the purpose of effecting any of the foregoing;
(e) If any judgment (to the extent not covered by
insurance) and/or arbitration award (singly or in the aggregate outstanding at
any one time) in excess of Ten Thousand Dollars ($10,000) shall be rendered
against the Company and is not stayed or discharged within thirty (30) days of
the date thereof, or any stay with respect thereto shall lapse and such judgment
or award is not discharged and such stay is not reinstated within thirty (30)
days.
Immediately upon the occurrence of an Event of Default, at Lender's
option, (i) the Maturity Date shall be deemed to have occurred automatically
and (ii) the entire principal amount of this Debenture then outstanding, all
other amounts payable by the Company hereunder shall automatically become and
be due and payable, without presentment, demand, protest or any notice of any
kind, all of which are hereby expressly waived by the Company, anything herein
to the contrary notwithstanding.
6. PREPAYMENT. The Company may at any time, without penalty, upon at
least five (5) days' advance written notice to the Holder, prepay in whole or in
part the unpaid balance of this Note. All payments will first be applied to the
repayment of accrued fees and expenses, then to accrued interest until all then
outstanding accrued interest has been paid, and then shall be applied to the
repayment of principal.
7. WAIVERS. The Company and all endorsers of this Note hereby waive
notice, presentment, protest and notice of dishonor.
8. ATTORNEYS' FEES. In the event any party is required to engage the
services of any attorneys for the purpose of enforcing this Note, or any
provision thereof, the prevailing party shall be entitled to recover its
reasonable expenses and costs in enforcing this Note, including attorneys' fees.
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9. TRANSFER. This Note may be assigned by ▇▇▇▇▇▇ in its sole
discretion upon written notice to the Company, so long as Lender complies with
applicable securities laws and regulations. The rights and obligations of the
Company and the Holder under this Note shall be binding upon and benefit their
respective permitted successors, assigns, heirs, administrators and transferees.
The Company may not assign this Note.
10. GOVERNING LAW. This Note shall be governed by and construed under
the internal laws of the State of Georgia as applied to agreements among
Delaware residents entered into and to be performed entirely within Delaware,
without reference to principles of conflict of laws or choice of laws.
11. HEADINGS. The headings and captions used in this Note are used
only for convenience and are not to be considered in construing or interpreting
this Note. All references in this Note to sections and exhibits shall, unless
otherwise provided, refer to sections hereof and exhibits attached hereto, all
of which exhibits are incorporated herein by this reference.
12. NOTICES. All notices required or permitted hereunder, to be
effective, shall be in writing and shall be deemed effectively given: (a) upon
personal delivery to the party to be notified, (b) when sent by confirmed telex
or facsimile if sent during normal business hours of the recipient, if not, then
on the next business day, (c) five (5) days after having been sent by registered
or certified mail, return receipt requested, postage prepaid, or (d) one (1)
business day after deposit with a nationally recognized overnight courier,
specifying next day delivery, with written verification of receipt. All
communications shall be sent to the addresses provided as follows:
If to the The Company:
Black Nickel Acquisition Corp II
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇. President
If to the Lender:
PEF Advisors
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
13. AMENDMENTS AND WAIVERS. Any term 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) only with the
written consent of the Company and the Holder. Any amendment or waiver
effected in accordance with this Section shall be binding upon the Holder, each
future holder of such securities, and the Company. This is the entire agreement
between the parties with respect to the subject matter hereof.
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14. SEVERABILITY. If one or more provisions of this Note are held to
be unenforceable under applicable law, such provision(s) shall be excluded from
this Note and the balance of the Note shall be interpreted as if such
provision(s) were so excluded and shall be enforceable in accordance with its
terms.
IN WITNESS WHEREOF, the Company has executed and delivered this Note as
a sealed instrument as of the day and year first written above.
BLACK NICKEL ACQUISITION CORP II
BY: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇., President
-----------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇., President
AGREED AND ACKNOWLEDGED
THE HOLDER
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By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Signature: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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