Exhibit 10.1
UNSECURED PROMISSORY
NOTE
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$274,410 – Original Principal
Amount
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Issue Date – August 10,
2009
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Santa Ana, California
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For value received, MAXxess
Systems, Inc., a California corporation and its successors and
assigns (the “ Company ”), hereby
promises to pay to Iteris, Inc., a Delaware corporation
(together with its successors and assigns, the “
Holder ”), in lawful money of the United States
at the address of Holder set forth below, the principal sum of Two
Hundred Seventy-Four Thousand Four Hundred Ten Dollars ($274,410),
together with all accrued but unpaid interest thereon. This
Unsecured Promissory Note (the “ Note ”)
memorializes the Company’s pre-existing business obligation
owed to Holder for prior sublease payments and other services
previously rendered to the Company.
1.
Due Date .
Unless this Note is extended with
the written consent of the Holder or is accelerated in accordance
with the terms of this Note, the entire outstanding principal
balance of this Note, together with all accrued and unpaid
interest, shall be due and payable on August 10, 2014
(the “ Due Date ”).
2.
Terms of Payment;
Interest .
2.1
Interest shall accrue on the
principal outstanding under this Note from time to time, commencing
from the Issue Date of this Note and continuing until repayment of
this Note in full, at a rate equal to six percent (6%) per annum,
compounded annually (computed on the basis of a year of three
hundred sixty-five (365) days of actual days elapsed).
Accrued interest shall be payable annually on the first business
day of each calendar year. Notwithstanding anything herein to
the contrary, if during any period for which interest is computed
under this Note, the amount of interest computed on the basis
provided for in this Note, together with all fees, charges and
other payments that are treated as interest under applicable law,
would exceed the amount of such interest computed on the basis of
the Highest Lawful Rate, the Company’s obligations hereunder
shall, automatically and retroactively, be deemed reduced to the
Highest Lawful Rate (as defined below), and during any such period
the interest payable under this Note shall be computed on the basis
of the Highest Lawful Rate. In the event Holder receives as
interest an amount that would exceed the Highest Lawful Rate, then
the amount of any excess interest shall not be applied to the
payment of interest hereunder, but shall be applied to the
reduction of the unpaid principal balance due hereunder. As
used herein, “ Highest Lawful Rate ”
means the maximum non-usurious rate of interest, as in effect from
time to time, which may be charged, contracted for, reserved,
received or collected by the Holder in connection with this Note
under applicable law.
2.2
All payments under this Note shall
be made (i) in lawful money of the United States of America at
the principal office of the Company, or at such other place as
Holder may from time to time designate in writing to the Company;
or (ii) in bona fide services rendered by the Company to the
Holder, provided that the nature and value of such services are
approved in writing in advance by the Holder and the Company.
Payments under this Note shall be applied first to the payment of
all accrued and unpaid interest and then to the payment of
principal. Prepayment of the principal amount of this Note,
together with all accrued and unpaid interest on the portion of
principal so prepaid, may be made in whole or in part at any time
without penalty.
3.
Subordination
.
3.1
Subordinated Amount
. The Holder and the Company
agree that this Note and the Company’s obligations under this
Note shall be subordinated to any debt financing by the Company
with one or more lenders subsequent to the Issue Date of this Note,
but only up to an aggregate subordinated amount of Five Million
Dollars ($5,000,000) (the “ Subordinated Amount
” ). The Holder agrees to execute any documents
reasonably requested by the investors in such financings to give
effect to such subordination.
1
UNSECURED PROMISSORY
NOTE
3.2
Pari Passu Amount
. The Company and the Holder
agree that this Note and the Company’s obligations under this
Note shall be on pari passu with any debt financing by the
Company in excess of the Subordinated Amount, and the Company
agrees to execute (and to have such investor in the excess investor
to execute as a condition to such financing) any documents
(including, but not limited to, any related intercreditor
agreements, security agreements. and financing statements)
reasonably requested by the Holder to give effect to such pari
passu treatment.
3.3
Notice of Financings
. For so long as any amount of
this Note remains outstanding, the Company agrees to notify the
Holder in writing at least five (5) business days prior to the
closing of any debt or equity financing by the Company. For
the purposes of this Note, the term “ financing
” shall not include (a) any option exercises or stock
issuance under the Company’s benefit plans, (b) trade
payables incurred in the ordinary course of the Company’s
business or (c) short-term bank borrowings or receivable
factoring.
4.
Representations and Warranties of
Company .
The Company hereby represents and
warrants to the Holder that this Note has been duly and validly
executed and delivered by Company and constitutes a legal, valid
and binding obligation of Company enforceable against Company in
accordance with its terms, except as the enforceability thereof may
be limited by bankruptcy, insolvency, fraudulent conveyance, or
other similar laws relating to the enforcement of creditors’
rights generally and by general principles of equity.
5.
Acceleration Upon Change in
Control or Significant Financing .
For the purposes of this Note, a
“ Change in Control ” shall be deemed to
occur upon (i) the sale, lease, license or transfer, in a
single transaction or a series of trans
