Exhibit 10.28
UNSECURED PROMISSORY NOTE
San Francisco, California
January 21, 2000
Page 1 of 4
FOR VALUE RECEIVED, the undersigned, BoysToys.com, Inc., a Delaware
corporation (hereinafter called "Maker"), promises to pay to the order of
Lewis Chin with principal address at 17 Jacqueline Court, Daily City,
California 94014(together with all subsequent holders of this Note, hereinafter
called "Payee"), or at such other place as Payee may from time to time
designate in writing, the principal sum of the amount that may be loaned to
Payee hereby which amount shall be One Hundred Thousand Dollars ($100,000),
together with interest thereon calculated on a daily basis (based, at Payee's
option, on 360-day or 365/366-day years) from the date hereof on the principal
balance from time to time outstanding (the "Principal Amount") as hereinafter
provided, principal, interest and all other sums payable hereunder to be paid
in lawful money of the United States of America as follows:
A. Interest shall accrue on the Principal Amount and in lieu of all
amounts that payable as interest, the Company shall, on March 24, 2000
(the "Maturity Date"), pay and deliver to Payee a stock certificate
representing fifty thousand (50,000) shares of the common stock (par value
$0.01) of Maker (the "Interest"). Said stock certificate shall be
impressed with a restricted securities legend in accordance with the
Securities Act of 1933.
B. If not earlier due and payable, the unpaid principal balance, all
accrued and unpaid interest and all other amounts payable hereunder shall
be due and payable in full on the Maturity Date.
C. Maker agrees that, on or before the Maturity Date, to repay the
Principal amount of this Note by assigning to Payee all of the proceeds of
certain loan proceeds received by Maker from certain equipment loans.
If any payment required under this Note is not paid within fifteen
(15) days after the date such payment is due, then, at the option of Payee,
Maker shall pay a "late charge" equal to two percent (2%) of the amount of that
payment to compensate Payee for administrative expenses and other costs of
delinquent payments. This late charge may be assessed without notice, shall be
immediately due and payable and shall be in addition to all other rights and
remedies available to Payee.
All payments on this Note shall be applied in such manner as Payee elects,
and may be applied first to the payment of any costs, penalties, late charges,
fees or other charges incurred in connection with the indebtedness evidenced
hereby, next to the payment of accrued interest and then to the reduction of
the principal balance.
At the option of Payee, the entire unpaid principal balance, all accrued
and unpaid interest and all other amounts payable hereunder shall become
immediately due and payable without notice upon the failure to pay any sum due
and owing hereunder as provided herein or upon the occurrence of any Event of
Default in any of the Loan Documents.
The occurrence of any of the following events or conditions shall
constitute and is hereby defined to be an "Event of Default":
(a) Any failure to pay any principal or interest or any other amount
due in connection with this Note when the same shall become due and
payable.
(b) Any failure or neglect to perform or observe any of the terms,
provisions, or covenants of any of the Loan Documents or any other
document or instrument executed or delivered in connection with the Note,
and such failure or neglect either cannot be remedied or, if it can be
remedied, it continues unremedied for a period of fifteen (15) days after
notice thereof to Maker.
(c) Any warranty, representation or statement contained in any of
the Loan Documents or any other document or instrument executed or
delivered in connection with this Note, or made or furnished by or on
behalf of Maker, that shall be or shall prove to have been false when made
or furnished.
(d) The filing by Maker, any endorser of the Note or any guarantor
of this Note (or against Maker or such endorser or guarantor in which
Maker or such endorser or guarantor acquiesces or which is not dismissed
within forty-five (45) days after the filing thereof) of any proceeding
under the federal bankruptcy laws now or hereafter existing or any other
similar stature now or hereafter in effect; the entry of an order for
relief under such laws with respect to Maker or such endorser or
guarantor; or the appointment of a receiver, trustee, custodian or
conservator of all or any part of the assets of Maker or such endorser or
guarantor.
(e) The insolvency of Maker, any endorser of the Note or any
guarantor of this Note; or the execution by Maker or such endorser or
guarantor of an assignment for the benefit of creditors; or the convening
by Maker or such endorser or guarantor of a meeting of its creditors, or
any class thereof, for purposes of effecting a moratorium upon or
extension or composition of its debts; or the failure of Maker or such
endorser or guarantor to pay its debts as they mature; or if Maker or such
endorser or guarantor is generally not paying its debts as they mature.
(f) The admission in writing by Maker, any endorser of the Note or
any guarantor of this Note that it is unable to pay its debts as they
mature or that it is generally not paying its debts as they mature.
(g) The death or incapacity of Maker, any endorser of the Note or
any guarantor of this Note, if an individual, or the liquidation,
termination or dissolution of Maker or any such endorser or guarantor, if
a corporation, partnership or joint venture.
(h) The occurrence of any Event of Default under any of the Loan
Documents or any other document or instrument executed or delivered in
connection with this Note; and not otherwise specifically described in
other provisions of this Note.
(i) The occurrence of any adverse change in the financial condition
of Maker that Payee, in its reasonable discretion, deems material, or if
Payee in good faith shall believe that the prospect of payment or
performance of the Note is impaired.
Maker shall pay all costs and expenses, including reasonable attorneys'
fees and court costs, incurred in the collection or enforcement of all or any
part of this Note. All such costs and expenses shall be secured by the Loan
Documents. In the event of any court proceedings, court costs and attorneys'
fees shall be set by the court and not by jury and shall be included in any
judgement obtained by Payee.
Upon the occurrence of an Event of Default under this Note or in any of the
other Loan Documents, Payee may proceed against any collateral securing this
Note or proceed against the undersigned in such order and manner as Payee, in
its sole discretion, shall determine, provided that under no circumstance shall
Payee be obligated to proceed against any collateral or against the undersigned
for collection of any sums due hereunder.
Failure of Payee to exercise any option hereunder shall not constitute a
waiver of the right to exercise the same in the event of any subsequent default
or in the event of the continuance of any existing default after demand for
strict performance hereof.
Maker, sureties, guarantors and endorsers hereof: (a) agree to be jointly
and severally bound, (b) severally waive demand, diligence, presentment for
payment, protest and demand, and notice of extension, dishonor, protest, demand
and nonpayment of this Note, (c) consent that Payee may extend the time of
payment or otherwise modify the terms of payment of any part or the whole of
the debt evidenced by this Note, at the request of any other person primarily
liable hereon, and such consent shall not alter nor diminish the liability of
any person, and (d) agree that Payee may set off at any time any sums or
property owed to any of them by Payee.
No provision of this Note is intended to or shall require or permit Payee,
directly or indirectly, to take, collect or receive in money, goods or in any
other form, any interest (including amount deemed by law to be interest) in
excess of the maximum rate of interest permitted by applicable law.
If any amount due from or paid by Maker shall be determined by a court of
competent jurisdiction to be interest in excess of such maximum rate, Maker
shall not be obligated to pay such excess and, if paid, such excess shall be
applied against the unpaid principal balance of this Note, or if and to the
extent that this Note has been paid in full, such excess shall be remitted to
Maker.
This Note shall be binding upon Maker and its successors and assigns and
shall inure to the benefit of Payee and its successors and assigns.
All notices required or permitted in connection with this Note shall be
given at the place and address as separately provided by each party to this
Note.
This Note shall be governed by and construed according to the laws of the
State of Delaware as if this Note were executed and all actions were taken
hereby in the State of Delaware.
IN WITNESS WHEREOF, these presents are executed as of the date first
written above.
MAKER:
BOYSTOYS.COM, INC.
(a Delaware corporation)
By: /s/ Ralph M. Amato
-------------------------
Ralph M. Amato
President & CEO
Payee acknowledges and agrees that prior to execution and delivery of this
Note to Payee, Payee:
(i) is an Accredited Investor (as that term is defined under Rule 501 of
Regulation D) and had and continues to have a pre-existing business
relationship with Payee in that Payee is the landlord under the
terms of that certain lease agreement between Payee and Maker
wherein Maker (as Tenant) leases that certain real property located
at 408-412 Broadway, San Francisco, California;
(ii) received a copy of Maker's Form 10-SB (as filed with the U.S.
Securities and Exchange Commission;
(iii) received a copy of Maker's audited financial statements for the
years ending December 31, 1997 and December 31, 1998 together with
unaudited financial statements as of September 30, 1999;
(iv) understands that the Note and the Shares are restricted securities
of a small public company whose common stock is traded only
sporadically on the OTC Pink Sheets and there is no guarantee that
the Shares can be sold in any liquid trading market; and
(v) has read and understands that this Note and the Shares are subject
to significant risks as identified in that Section of Form 10-SB
titled as, "Factors That May Affect Future Results."
Agreement and acknowledgment: /s/ Lewis Chin
---------------
Lewis Chin
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