PROMISSORY
NOTE
$150,000 Irvine,
California
as of December 21,
2004
FOR VALUE
RECEIVED, eRXSYS, INC., with an address at 18021 Sky Park. Circle, Suite G2,
Irvine, California 92614 (Borrower), hereby promises to pay to the order of
Robert James, Inc., a New York corporation with an address at 2805 Veterans
Highway, Suite 1, Ronkonkotna, NY 11779 (the “Lender) ON DEMAND, the principal
sum of ONE HUNDRED FIFTY THOUSAND DOLLARS ($150,000), or such lesser amount as
shall equal the aggregate outstanding unpaid principal amount of this Promissory
Note (“Note”), on the earlier to occur of (i) March 6, 2005, or (ii) the date
that eRXSYS, Inc. consummates its pending accounts receivable factoring
arrangement for its working capital needs.
Interest
Rate: The
outstanding principal amount of this Note shall bear interest at a rate of three
percent (3%) per month.
Fees. In
consideration of the acceptance of this Note, the Borrower agrees to pay to
Lender an administrative fee of ONE THOUSAND FIVE HUNDRED DOLLARS ($1,500) and a
financing fee of TWO THOUSAND ONE HUNDRED ($2,100). The foregoing fees are
payable at the funding of the Note.
The
Borrower further agrees to pay to Lender by the 5th day of every month
commencing January 2005 until the Principal amount is repaid, an administrative
fee of ONE THOUSAND EIGHT HUNDRED AND SEVENTY FIVE DOLLARS ($1,875) and a
financing fee of TWO THOUSAND SIX HUNDRED AND TWENTY FIVE ($2,675).
Payments. All
payments due pursuant to this Note shall be made by check to Lender at its
address set forth above, or in immediately available finds by wire transfer to
Lender’s account at such bank as Lender shall have previously designated to
Borrower.
Document
Deliveries. The
Borrower has provided to Lender (a) a true and complete copy of current drafts
of its financial statements and (b) a true and complete copy of the minutes from
the meeting from the board approving the execution and performance of this
Note.
No
Defaults. Other
than as disclosed in the Borrower’s period reports filed with the Securities and
Exchange Commission, no action is pending against Borrower in equity or
otherwise, before any court, board, commission, agency or instrumentality of the
Federal or any State government of any municipal government or any agency or
subdivision thereof including, without limitation, bankruptcy, receivership,
mechanic or other liens or personal tort or contractual
liability.
Covenants.
Borrower
warrants and covenants that, so long as Borrower shall have any obligation to
Lender hereunder, Borrower will not default in the payments of this Note or any
other material debt.
Events
of Default. The
occurrence and continuation of any of the following events shall constitute
default: (a) failure of Borrower to pay any installment of interest or principal
on the Note on the date it is due and such failure is not remedied within 10
days of that date; or (b) any representation or warranty made by Borrower in
this Agreement or in any certificate, agreement instrument or statement
contemplated by or made or delivered pursuant to or in connection with this
Agreement shall prove to have been incorrect or untrue in any material respect
when made or on and as of any date on which Borrower has any obligation to
Lender hereunder; or (c) Borrower shall fail to observe or perform any other
term, covenant or agreement contained in this Agreement on its part to be
performed or observed; or (d) Borrower shall be adjudicated bankrupt, or admit
in writing its inability to pay debts as they mature, or make the assignment for
the benefit of creditors or similar proceedings. In the event of default as set
forth above, the Lender may declare any and all obligations of Borrower to
Lender, including obligations arising under this Note, immediately due and
payable, without presentment, demand, protest or further notice of any kind, all
of which are hereby expressly waived.
Business
Days. Whenever
any payment to be made hereunder shall be due on a Saturday, Sunday or public
holiday under the laws of the State of New York, such payment may be made on the
next succeeding business day.
Waivers. Borrower
hereby waives presentment, demand for payment, notice of dishonor, protest and
notice of protest of this Note. No waiver of any provision of this Note, or any
agreement or instrument evidencing or providing security for this Note, made by
agreement of Lender and any other person or party, shall constitute a waiver of
any other terms hereof, or otherwise release or discharge the liability of
Borrower under this Note. No failure to exercise and no delay in exercising, on
the part of Lender, any right, power or privilege under this Note shall operate
as a waiver thereof nor shall simple or partial exercise of any right, power or
privilege preclude any other or further exercise thereof, or the exercise of any
other power, right or privilege. The rights and remedies herein provided are
cumulative and are not exclusive of any rights or remedies provided by
law.
Partial
Unenforceability. Any
provision of this Note that is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such prohibition
or unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other
jurisdiction.
Choice
of Laws. This Note
is governed by and to be construed in accordance with the laws of the State of
New York without regard to its doctrine of conflict of laws. Borrrower, by its
execution hereof, (i) agrees that any legal suit, action or proceeding
arising
from or related to this Note may be instituted in a state or federal court
located in the State of New York; (ii) waives any objection which it may now or
hereafter have to the laying of venue of any such suit, action or proceeding;
and (iii) irrevocably submits to the jurisdiction of any such court in any such
suit, action or proceeding.
No Jury Trial. IN ANY
ACTION, SUIT OR PROCEEDING IN RESPECT OF OR ARISING OUT OF THIS NOTE, EACH OF
LENDER AND BORROWER WAIVES TRIAL BY
JURY.
Complete Agreement. This
Note, and any other agreements to which they
refer
constitute agreement between the parties with respect to the subject matter, and
may not be changed, modified, amended or terminated orally, but only by a
writing signed by the party to be charged.
Assignment. Lender
may assign any of all of its rights hereunder in whole or in part.
Notices.
Whenever
this Agreement provides for notice to any party, it shall be given by messenger,
telegram, or mail (registered or certified, return receipt requested), effective
when received by the party to whom addressed, and shall be addressed as follows
or to such other address as the party affected may hereafter designate by notice
given as provided herein.
eRXSYS,
INC.
By:
/s/ Chris Lukas
Name:
Chris Lukas
Title
Director of West Coast Operations