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Exhibit
10.40
DELTA MUTUAL, INC.
6% PROMISSORY NOTE
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$16,900
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May
14, 2008
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Sellersville,
Pennsylvania
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FOR
VALUE RECEIVED, DELTA MUTUAL INC., a Delaware corporation (the
"
Company "),
with offices at 111 North Branch Street, Sellersville, PA 18960,
promises to pay to
Security Systems International, Inc. ,
a Delaware corporation, (the "
Lender "),
with a mailing address of 9034 East Caribbean Lane, Scottsdale, AZ
85260, in lawful money of the United States of America, the
principal sum of Sixteen Thousand Nine Hundred Dollars ($16,900),
together with interest from the date of this Note on the unpaid
principal balance at a rate equal to six percent (6.0%) per annum,
computed on the basis of a year of 360 days. All unpaid principal,
together with any then unpaid and accrued interest, shall be due
and payable at any time after the earlier of each of (i)the
Maturity Date (as defined below), or (ii)when, upon or after the
occurrence of an Event of Default (as defined below), such amounts
are declared due and payable by the Lender or made automatically
due and payable in accordance with the terms hereof.
The
following is a statement of the rights of the Lender and the
conditions to which this Note is subject, and to which the
Lender, by the acceptance of this Note, agrees:
1.
Definitions .
As used in this Note, the following capitalized terms have
the following meanings:
"Company"
includes the corporation initially executing this Note and any
Person which shall succeed to or assume the obligations of the
Company under this Note.
1.2
"Event of Default" has the meaning given in Section 5
hereof.
1.3
"Lender" shall mean the Person specified in the introductory
paragraph of this Note.
1.4
"Maturity Date" shall mean six months from the date
hereof.
1.5
"Obligations" shall mean all obligations, owed by the Company
to the Lender, now existing or hereafter arising under or
pursuant to the terms of this Note.
1.6
"Person"
shall mean and include an individual, a partnership, a
corporation (including a business trust), a joint stock
Company, a limited liability Company, an unincorporated
association, a joint venture or other entity or a governmental
authority.
2.
Interest .
All accrued and unpaid interest on this note shall be due
and payable on the Maturity Date.
3.
Repayment at the Company’s
Option.
At any time after the date hereof and prior to the maturity Date,
the Company my repay this Note, including all accrued interest,
without penalty or premium, in whole or in part; provided that such
repayment will be applied first to the payment of unpaid interest
accrued n this Note, and second, to payment of the principal amount
of this Note.
4.
Representations and Warranties of The
Lender
. The Lender represents and warrants to the Company upon the
acquisition of the Note as follows:
4.1
Binding Obligation . The
Lender has full legal capacity, power and authority to execute
and deliver this Note and to perform its obligations
hereunder. This Note is a valid and binding obligation of the
Lender, enforceable in accordance with its terms, except as
limited by bankruptcy, insolvency or other laws of general
application relating to or affecting the enforcement of
creditors' rights generally and general principles of
equity.
4.2
Own Account . The
Lender is purchasing this Note for his own account for
investment, not as a nominee or agent, and not with a view to,
or for resale in connection with, the distribution thereof.
The Lender has such knowledge and experience in financial and
business matters that the Lender is capable of evaluating the
merits and risks of such investment, is able to incur a
complete loss of such investment and is able to bear the
economic risk of such investment for an indefinite period of
time.
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