EXHIBIT 10.17
PROMISSORY NOTE
Stamford, Connecticut
January 4, 2000
$457,496.86
FOR VALUE RECEIVED, Sebastian E. Cassetta promises to pay to SmartServ
Online, Inc., a Delaware corporation (the "Company"), or order, the principal
sum of Four Hundred Fifty-Seven Thousand Four Hundred Ninety-Six Dollars and
Eighty-Six Cents ($457,46.86), together with interest on the unpaid principal
hereof from the date hereof at the rate of 7.5% [such interest equal to one
point below the prime rate as of the date of this Note] per annum, compounded
annually. Notwithstanding the foregoing, the principal amount of the Note shall
be subject to an automatic reduction to the principal amount pursuant to the
terms of the Purchase Agreement (as defined below).
This Note shall be due and payable in full on December 29, 2003 (the
"Due Date"), unless accelerated as provided herein. Upon the termination of
employment of Sebastian E. Cassetta from the Company for Cause, the whole unpaid
balance on this Note of principal and interest shall become immediately due at
the option of the holder of this Note. In the event that Sebastian E. Cassetta
terminates his employment with the Company for Good Reason, the whole unpaid
balance on this Note of principal and interest shall be due and payable upon the
earlier of the Due Date or six (6) months from the Date of Termination. Payments
of principal and interest shall be made in lawful money of the United States of
America.
The undersigned may at any time prepay without penalty all or any
portion of the principal owing hereunder.
This Note is subject to the terms of that certain Restricted Stock
Purchase Agreement by and between the Company and Sebastian E. Cassetta, dated
as of December 29, 1998, as amended (the "Purchase Agreement") and capitalized
terms used herein which are not otherwise defined shall have the meanings
ascribed to them in the Purchase Agreement or in an employment agreement between
the Company and Sebastian E. Cassetta, dated as of January 1, 1999. This Note is
secured by a pledge of the Company's Common Stock under the terms of a Security
Agreement of even date herewith (the "Security Agreement") and is subject to all
the provisions thereof.
This Note is intended to evidence a non-recourse obligation with
respect to the principal hereof to secure the purchase of the Company's Common
Stock pursuant to the Purchase Agreement. Accordingly, this Note shall be
without recourse with respect to the principal against Sebastian E. Cassetta and
no person entitled to payment under this Note shall have any right to his assets
other than the collateral given for this Note and earnings attributable to such
collateral or the investment of such collateral, if any. The obligation to repay
interest pursuant to the terms of this Note shall be a recourse obligation.
This Note shall be governed and construed in accordance with the laws
of the State of Connecticut.
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Sebastian E. Cassetta
