10% CONVERTIBLE PROMISSORY NOTE OF PEER TO PEER NETWORK

Exhibit 10.1

 

-Note: August 7, 2015

NEITHER THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

THIS NOTE DOES NOT REQUIRE PHYSICAL SURRENDER OF THE NOTE IN THE EVENT OF A PARTIAL REDEMPTION OR CONVERSION.  AS A RESULT, FOLLOWING ANY REDEMPTION OR CONVERSION OF ANY PORTION OF THIS NOTE, THE OUTSTANDING PRINCIPAL SUM REPRESENTED BY THIS NOTE MAY BE LESS THAN THE PRINCIPAL SUM AND ACCRUED INTEREST SET FORTH BELOW.

 

Issuance Date:  August 7, 2015

Total Face Value of Note: $110,000

Initial Consideration: $27,500

Initial Original Issue Discount: $2,750

Initial Principal Sum Due: $30,250

This Note is a duly authorized Convertible Promissory Note of Peer to Peer Network a corporation duly organized and existing under the laws of the State of Nevada (the "Company"), designated as the Company's 10% Convertible Promissory Note in the principal amount of $110,000 (the "Note"). This Note will become effective only upon execution by both parties and delivery of the first payment of consideration by the Lender (the "Effective Date").

For Value Received, the Company hereby promises to pay to the order of Tangiers Investment Group, LLC or its registered assigns or successors-in-interest ("Holder") the Principal Sum of $110,000 (the "Principal Sum") and to pay "guaranteed" interest on the principal balance hereof at an amount equivalent to 10% of the Principal Sum, to the extent such Principal Sum and "guaranteed" interest and any other interest, fees, liquidated damages and/or items due to Holder herein have been repaid or converted into the Company's Common Stock (the "Common Stock"), in accordance with the terms hereof. Upon the execution of this Note the sum of $27,500 shall be remitted and delivered to the Company, and $2,750 shall be retained by the Purchaser through an original issue discount (the "OID") for due diligence and legal bills related to this transaction. The OID is set at 10% of any consideration paid. The Holder may pay additional Consideration to the Company in such amounts and at such dates (each, an "Additional Consideration Date") as Holder may choose in its sole discretion. The Principal Sum due to Holder shall be prorated based on the Consideration actually paid by Holder (plus the "guaranteed" interest and 10% OID, both which are prorated based on the Consideration actually paid by the Holder, as well as any other interest or fees) such that the Company is only required to repay the amount funded and the Company is not required to repay any unfunded portion of this Note. The Maturity Date is one year from the Effective Date of each payment (the "Maturity Date") and is the date upon which the Principal Sum of this Note, as well as any unpaid interest and other fees, shall be due and payable.

In addition to the "guaranteed" interest referenced above, and in the Event of Default pursuant to Section 2(a), additional interest will accrue from the date of the Event of Default at the rate equal to the lower of 10% per annum or the highest rate permitted by law (the "Default Rate").

This Note will become effective only upon the execution by both parties, including the execution of Exhibits B, C and D and the Irrevocable Transfer Agent Instructions and delivery of the initial payment of consideration by the Holder (the "Effective Date").

This Note may be prepaid by the Company, in whole or in part, according to the following schedule:

After 180 days from the Effective Date this Note may not be prepaid without written consent from ▇▇▇▇▇▇, which consent may be withheld, delayed, denied, or conditions in ▇▇▇▇▇▇'s sole and absolute discretion.  Whenever any amount expressed to be due by the terms of this Note is due on any day which is not a Business Day (as defined below), the same shall instead be due on the next succeeding day which is a Business Day.

For purposes hereof the following terms shall have the meanings ascribed to them below:

"Business Day" shall mean any day other than a Saturday, Sunday or a day on which commercial banks in the City of New York are authorized or required by law or executive order to remain closed.

"Conversion Price" shall be equal to the lower of: (a) 50% of the lowest trading price of the Company's common stock during the 20 consecutive trading days prior to the date on which Holder elects to convert all or part of the Note or (b) 50% of the lowest trading price of the Company's common stock during the 20 consecutive trading days prior to the Effective Date.  For the purpose of calculating the Conversion Price only, any time after 4:00 pm Eastern Time (the closing time of the Principal Market) shall be considered to be the beginning of the next Business Day.  If the Company is placed on "chilled" status with the Depository Trust Company ("DTC"), the discount shall be increased by 10%, i.e., from 50% to 60%, until such chill is remedied.  If the Company is not Deposits and Withdrawal at Custodian ("DWAC") eligible through their Transfer Agent and DTC's Fast Automated Securities Transfer ("FAST") system, the discount will be increased by 5%, i.e., from 50% to 55%,.  In the case of both, the discount shall be a cumulative increase of 15%, i.e., from 50% to 65%.  Any default of this Note not remedied within the applicable cure period will result in a permanent additional 5% increase, i.e., from 50% to 65%, in addition to any other discount, as provided above, to the Conversion Price discount.

"Principal Amount" shall refer to the sum of (i) the original principal amount of this Note (including the original issue discount, prorated if the Note has not been funded in full), (ii) any additional payments made by the Holder towards the Principal Sum (iii) all guaranteed and other accrued but unpaid interest hereunder, (iv) any fees due hereunder, (v) liquidated damages, and (vi) any default payments owing under the Note, in each case previously paid or added to the Principal Amount.

"Principal Market" shall refer to the primary exchange on which the Company's common stock is traded or quoted.

"Trading Day" shall mean a day on which there is trading or quoting for any security on the Principal Market.

"Underlying Shares" means the shares of common stock into which the Note is convertible (including interest, fees, liquidated damages and/or principal payments in common stock as set forth herein) in accordance with the terms hereof.

The following terms and conditions shall apply to this Note:

Name:

Title:

Email:

Address:

This Convertible Promissory Note of August 7, 2015 is accepted this ____ day of ______, 2015 by

Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇

Title: Manager

FORM OF CONVERSION NOTICE

(To be executed by the Holder in order to convert all or part of that certain $110,000 Convertible Promissory Note identified as the Note)

Re:

$110,000 Convertible Promissory Note (this "Note") originally issued by Peer to Peer Network, a Nevada corporation, to Tangiers Investment Group, LLC on August 7, 2015.

The undersigned on behalf of Tangiers Investment Group, LLC, hereby elects to convert $_______________________ of the aggregate outstanding Principal Sum (as defined in the Note) indicated below of this Note into shares of Common Stock, $0.001 par value per share, of Peer to Peer Network (the "Company"), according to the conditions hereof, as of the date written below.  If shares are to be issued in the name of a person other than undersigned, the undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith such certificates and opinions as reasonably requested by the Company in accordance therewith.  No fee will be charged to the holder for any conversion, except for such transfer taxes, if any.  The undersigned represents as of the date hereof that, after giving effect to the conversion of this Note pursuant to this Conversion Notice, the undersigned will not exceed the "Restricted Ownership Percentage" contained in this Note.

Conversion information:

                                                                                                                                

Date to Effect Conversion

 

                                                                                                                                                                                                                                                                                                                                                                                    
Aggregate Principal Sum of Note Being Converted

 

Aggregate Interest/Fees Being Converted

 

                                                                                                                                                                                                                                                                                                                                                                                    
Remaining Principal Balance

 

                                                                                                                                                                                                                                                                                                                                                                                   
Number of Shares of Common Stock to be Issued

 

                                                                                                                                                                                                                                                                                                                                                                                     
Applicable Conversion Price

 

                                                                                                                                                                                                                                                                                                                                                                                   
Signature

 

                                                                                                                                                                                                                                                                                                                                                                                   
Name

 

                                                                                                                                                                                                                                                                                                                                                                                    
Address

 

WRITTEN CONSENT OF THE BOARD OF DIRECTORS OF

The undersigned, being directors of Peer to Peer Network, a Nevada corporation (the "Company"), acting pursuant to the Bylaws of the Corporation, do hereby consent to, approve and adopt the following preamble and resolutions:

The board of directors of the Company has reviewed and authorized the following documents relating to the issuance of a Convertible Promissory Note in the amount of $110,000 with Tangiers Investment Group, LLC.

The documents agreed to and dated August 7, 2015 are as follows:

10% Convertible Promissory Note of Peer to Peer Network

Irrevocable Transfer Agent Instructions

Notarized Certificate of Chief Executive Officer

Disbursement Instructions

IN WITNESS WHEREOF, the undersign member(s) of the board of the Company executed this unanimous written consent as of August 7, 2015.

_________________________________

By:

Its:

(Two Pages)

The undersigned, _______________________ is the duly elected Chief Executive Officer of Peer to Peer Network, a Nevada corporation (the "Company").

I hereby warrant and represent that I have undertaken a complete and thorough review of the Company's corporate and financial books and records, including, but not limited to, the Company's records relating to the following:

(A)

The issuance of that certain convertible promissory note dated August 7, 2015 (the "Note Issuance Date") issued to Tangiers Investment Group, LLC (the "Holder") in the stated original principal amount of $110,000 (the "Note");

(B)

The Company's Board of Directors duly approved the issuance of the Note to the Holder;

(C)

The Company has not received and does not contemplate receiving any new consideration from any persons in connection with any later conversion of the Note and the issuance of the Company's Common Stock upon any said conversion;

(D)

To my best knowledge and after completing the aforementioned review of the Company's stockholder and corporate records, I am able to certify that the Holder (and the persons affiliated with the Holder) are not officers, directors, or directly or indirectly, ten percent (10.00%) or more stockholders of the Company and none of said persons has had any such status in the one hundred (100) days immediately preceding the date of this Certificate;

(E)

The Company's Board of Directors have approved duly adopted resolutions approving the Irrevocable Instructions to the Company's Stock Transfer Agent attached to the Note Purchase Agreement, dated August 7, 2015;

(F)

Mark the appropriate selection:

___ The Company represents that it is not a "shell company," as that term is defined in Section 12b-2 of the Securities Exchange Act of 1934, as amended, and has never been a shell company, as so defined; or

___ The Company represents that (i) it was a "shell company," as that term is defined in Section 12b-2 of the Securities Exchange Act of 1934, as amended, (ii) since ______, 201__, it has no longer been a shell company, as so defined, and (iii) on _______, 201__, it provided Form 10-type information in a filing with the Securities and Exchange Commission.

(G)

I understand the constraints imposed under Rule 144 on those persons who are or may be deemed to be "affiliates," as that term is defined in Rule 144(a)(1) of the Securities Act of 1933, as amended.

(H)

I understand that all of the representations set forth in this Certificate will be relied upon by counsel to Tangiers Investment Group, LLC in connection with the preparation of a legal opinion.

I hereby affix my signature to this Notarized Certificate and hereby confirm the accuracy of the statements made herein.

SUBSCRIBED AND SWORN TO BEFORE ME ON THIS ________ DAY OF ____________________ 2015.

 

Commission Expires:______________

 

 

 

 

 

____________________________________

Notary Public

Pursuant to that certain Note Purchase Agreement between the parties listed above and dated August 7, 2015, a disbursement of funds will take place in the amount and manner described below:

                                     

                TOTAL: $27,500

 

For: Peer to Peer Network

Name:

Its: