Exhibit - C INSTALLMENT CASH PROMISSORY NOTE $2,000,000.00 Washington, D.C. January 4, 2008
FOR VALUE RECEIVED, the undersigned, WidePoint Corporation (" Maker" ), does hereby promise to pay to the order of Jin Kang (" Holder" ), the principal amount of Two Million Dollars ($2,000,000.00), together with simple interest computed on such principal amount from the date hereof on the unpaid principal balance at the fixed annual rate of (i) seven percent (7.0%) from the date of this Note through December 31, 2008, and (ii) ten percent (10.0%) from January 1, 2009 through the date of payment of this Note as provided in Section 1 below.
1. Payment Terms . The principal and interest amount outstanding under this Note shall be paid by the Maker to the Holder in one (1) lump sum payment on the earlier of either April 1, 2009 or the business day immediately following the filing by the Maker of its Annual Report on Form 10-K for the year ending on December 31, 2008, or as otherwise provided under the Purchase Agreement (as defined in Section 7 hereof), with all amounts due or payable at any time under this Note being subject to adjustment and offset as provided in the Purchase Agreement. The Maker shall make all such payments to the order of the Holder at 1163 Daleview Dr. McLean, VA 22102 (or such other address as may be designated in writing by Holder to Maker, which writing may be in the form of electronic mail).
2. Right to Prepayment . This Note may be prepaid in whole or in part at any time, without premium or penalty, with interest to the date of payment. If this Note is prepaid, there is to be no discount from the obligation to pay the full principal balance due at the time of prepayment.
3. Fees and Expenses . Whenever an attorney is used to obtain payment under, or to otherwise enforce, this Note or to enforce, declare, or adjudicate any rights or obligations under this Note, whether by suit or by any other means whatsoever, the costs and expenses thereof, including reasonable attorneys' fees and expenses, shall be payable by the non-prevailing party.
4. Events of Default . Each of the following shall constitute an event of default (" Event of Default" ) hereunder:
(a) If Maker fails to pay any installment of interest or principal on this Note when due hereunder which failure continues for a period of thirty (30) days after Maker' s receipt of written notice from the Holder. Receipt shall be deemed to have occurred if written notice is personally delivered to and signed for on behalf of the Maker or delivered certified first class mail, postage prepaid, to the addresses and representatives identified in Section 9.1 of the Purchase Agreement;
(b) If Maker shall admit in writing its inability to pay its debts as they become due, file a petition in bankruptcy or make a petition to take advantage of any insolvency act; make an assignment for the benefit of creditors, commence a proceeding for the appointment of a receiver, trustee, liquidator or conservator of all or any substantial part of its property; file a petition or answer seeking reorganization or similar relief under the Federal bankruptcy laws or any similar law or statute governing the relative rights of debtors and creditors;
(c) If any of the creditors of Maker shall file a petition in bankruptcy against Maker or for reorganization of Maker pursuant to the Federal bankruptcy laws or similar law or statute, and if such petition shall not be discharged or dismissed within sixty (60) calendar days after the date on which such petition was filed; and
(d) If Maker breaches any covenant contained in the Credit Agreement (defined below) .
In the event of the happening of any Event of Default, then the unpaid principal of this Note, and interest thereon until payment, shall forthwith become absolute and due and payable without any notice or demand whatsoever.
This Note (a) may not be changed, waived, discharged, or terminated except by an instrument in writing signed by each of the Maker and Holder, and (b) shall inure to the benefit of and be enforceable by the Holder and the Holder' s heirs, executors, administrators, and personal representatives.
This Note shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia applicable to agreements made and to be performed entirely within such State.
5. Subordination Provisions.
(a) Subordination of Liabilities . Maker, for itself, its successors and assigns, covenant and agree, and Holder, by his acceptance of this Note, likewise covenants and agrees, that the payment of the principal of, interest on, and all other amounts owing in respect of, this Note (the " Subordinated Indebtedness" ) is hereby expressly subordinated, to the extent and in the manner set forth below, to the prior payment in full in cash of all Senior Indebtedness (as defined in Section 5(g) hereof). The provisions of this Section 5 shall constitute a continuing offer to all persons or other entities who, in reliance upon such provisions, become holders of, or continue to hold, Senior Indebtedness, and such holders are made obligees hereunder the same as if their names were written herein as such, and they and/or each of them may proceed to enforce such provisions.
(b) Maker Not to Make Payments with Respect to Subordinated Indebtedness in Certain Circumstances.
(i) Upon the maturity of any Senior Indebtedness (including interest thereon or fees or any other amounts owing in respect thereof), whether at stated maturity, by acceleration or otherwise, all Obligations (as defined in Section 5(g) hereof) owing in respect of the Senior Indebtedness shall first be paid in full in cash, before any payment, whether in cash, property, securities or otherwise, is made on account of the Subordinated Indebtedness.
(ii) The Maker may not, directly or indirectly, make any payment of any Subordinated Indebtedness and may not acquire any Subordinated Indebtedness for cash or property until all Senior Indebtedness has been paid in full in cash if any default or event of default under the Credit Agreement (as defined in Section 5(g) hereof) or any other issue of Senior Indebtedness is then in existence or would result therefrom. The Holder hereby agrees that, so long as any such default or event of default in res ...
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