Exhibit 10.4

 

THIS UNSECURED PROMISSORY NOTE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS. 
IT MAY NOT BE SOLD, OFFERED FOR SALE OR OTHERWISE TRANSFERRED UNLESS REGISTERED
UNDER SUCH ACT OR IN COMPLIANCE WITH AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF SUCH ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE STATE
SECURITIES LAWS.  THE ISSUER OF THIS PROMISSORY NOTE MAY REQUIRE AN OPINION OF
COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY
PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE SECURITIES ACT OF 1933, AS
AMENDED, AND ANY APPLICABLE STATE SECURITIES LAWS.

 

 

THIS UNSECURED PROMISSORY NOTE IS NOT ASSIGNABLE BY THE HOLDER WITHOUT THE PRIOR
WRITTEN CONSENT OF THE COMPANY.

 

UNSECURED PROMISSORY NOTE

 

$1,000,000

August 25, 2011

 

Augme Technologies, Inc., a Delaware corporation (the “Company”), hereby
promises to pay to the order of Hipcricket, Inc., a Delaware corporation (the
“Holder”), on the Maturity Date, the principal amount of One Million Dollars
($1,000,000) (the “Principal Amount”) in accordance with the provisions of this
Unsecured Promissory Note (this “Note”).

 

1.         Interest.  Simple interest shall accrue on the unpaid principal
balance of this Note at a fixed annual rate of three percent (3%) (the
“Applicable Rate”).  Interest shall accrue daily at the Applicable Rate computed
on the basis of a 365/366 day year and the actual number of days elapsed in any
year from the date hereof.

 

2.         Maturity.  The outstanding principal balance of this Note shall be
paid by the Company to the Holder, together with accrued and unpaid interest
thereon, on the first to occur (the “Maturity Date”) of: (i) December 30, 2011,
and (ii) five (5) business days following the consummation by the Company of an
equity or equity-linked financing with gross proceeds to the Company of at least
Seven Million Dollars ($7,000,000).

 

3.         Prepayment.  The Company may prepay the outstanding principal balance
of this Note, in whole or in part, or pay any accrued interest hereon, at any
time or from time to time, without premium or penalty.  Any such prepayments
will be applied first to the payment of accrued but unpaid interest and then to
the principal balance outstanding hereunder.

 

4.         Time and Manner of Payments.  All payments on account of indebtedness
evidenced by this Note shall be made not later than 1 p.m. (New York time) on
the day when due in lawful money of the United States, or, in the event such day
is not a business day, on the next succeeding business day.  Such payments are
to be made in immediately available funds at Holder’s office listed in
Section 12, or at such other place as Holder may, from time to time, designate
to the Company in writing in accordance with Section 12.

 

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5.         Applicable Law; Jurisdiction; Waiver of Jury Trial.  THE COMPANY AND
HOLDER AGREE THAT THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF THE COMPANY AND
HOLDER HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK WITHOUT REGARD TO ANY CONFLICTS OF LAW PRINCIPLES.  THE
VENUE FOR ANY DISPUTE OR ACTION ARISING PURSUANT TO THIS NOTE SHALL BE IN THE
COURTS OF THE STATE OF NEW YORK, BOROUGH OF MANHATTAN, OR, IF IT HAS OR CAN
ACQUIRE JURISDICTION, IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND EACH OF HOLDER AND THE COMPANY IRREVOCABLY SUBMITS TO
THE EXCLUSIVE JURISDICTION OF EACH SUCH COURT IN ANY SUCH DISPUTE OR ACTION,
INCLUDING, BUT NOT LIMITED TO, THE IN PERSONAM AND SUBJECT MATTER JURISDICTION
OF EACH SUCH COURT, WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE TO VENUE
OR TO CONVENIENCE OF FORUM, AGREES THAT ALL CLAIMS IN RESPECT OF THE DISPUTE OR
ACTION SHALL BE HEARD AND DETERMINED ONLY IN ANY SUCH COURT, AND AGREES NOT TO
BRING ANY DISPUTE OR ACTION ARISING OUT OF OR RELATING TO THIS NOTE IN ANY OTHER
COURT. EACH OF THE COMPANY AND HOLDER HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY
IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS NOTE AND
ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE
BE DELIVERED IN CONNECTION HEREWITH OR ARISING FROM ANY RELATIONSHIP EXISTING IN
CONNECTION WITH ANY OF THE FOREGOING, AND AGREES THAT ANY SUCH ACTION OR
PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.

 

6.         Severability.  If any one or more of the provisions contained herein
shall for any reason be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provision hereof, and this Note shall be construed as if such invalid,
illegal or unenforceable provision had never been included.

 

7.         Maximum Interest.  Notwithstanding any provision of this Note or any
other Agreement between Company and Holder to the contrary, nothing herein shall
require the Company to pay, or Holder to accept, interest in an amount which
subjects the holder to any penalty or forfeiture under applicable law, and in no
event shall the total of all charges payable hereunder (whether of interest or
of such other charges which may or might be characterized as interest) exceed
the maximum rate permitted to be charged under applicable law.  Should Holder
receive any payment which is or would be in excess of that permitted to be
charged under applicable law, such payment shall have been, and shall be deemed
to have been, made in error and shall be promptly repaid to the Company.

 

8.         Events of Default.  The occurrence of any one of the following shall
constitute an “Event of Default” hereunder:

 

(a)        the failure of the Company to pay any part of the principal of, or
interest on, this Note when due, whether at stated maturity or by acceleration;

 

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(b)        the Company shall (i) apply for or consent to the appointment of, or
the taking of possession by, a receiver, administrative receiver, administrator,
custodian, trustee or liquidator of itself or of all or a substantial part of
its property, (ii) make a general assignment for the benefit of its creditors,
(iii) commence a voluntary case under any bankruptcy or similar law (as now or
hereafter in effect), (iv) file a petition seeking to take advantage of any
other law providing for the relief of debtors, or (v) fail to controvert in a
timely manner, or acquiesce in writing to, any petition filed against it in an
involuntary case under any bankruptcy or similar law;

 

(c)        a proceeding or case shall be commenced against the Company in any
court of competent jurisdiction, seeking (i) the liquidation, reorganization,
dissolution, winding up or composition or readjustment of its debts, (ii) the
appointment of a trustee, receiver, administrative receiver, administrator,
custodian, liquidator or the like of it or of all or any substantial part of its
assets, or (iii) similar relief in respect of it, under any bankruptcy or
similar law; and such proceeding or case shall continue undismissed, or unstayed
and in effect, for a period of sixty (60) days; and

 

(d)        a receiver, liquidator or trustee of the Company of a substantial
part of the properties of either of them shall be appointed by court order and
such order shall remain in effect for more than sixty (60) days; or the Company
shall be adjudicated bankrupt or insolvent; all or substantially all of the
assets of the Company or any material portion thereof is attached, seized,
subject to a writ of distress warrant, or levied upon, or comes into the
possession of any receiver, trustee, custodian or assignee for the benefit of
creditors, or are otherwise taken possession of by a secured or unsecured
creditor; and the same is not vacated, stayed, dismissed or set aside within
sixty (60) days after the occurrence thereof.

 

9.         Remedies Upon an Event of Default.  Upon the occurrence and during
the continuance of any Event of Default, Holder may, by written notice to the
Company, declare all unpaid principal and accrued interest under this Note
immediately due and payable, in which event the entire principal amount and
accrued interest on this Note shall become immediately due and payable, and the
holder of this Note shall have all of the rights and remedies conferred upon
Holder of this Note pursuant to applicable law or equity.

 

10.       Amendments.  No amendment or waiver of any provision of this Note, nor
consent to any departure by the Company therefrom, shall in any event be
effective unless the same shall be in writing and shall be signed by the Holder
(and in the case of any amendment, signed by the Company); any such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given.

 

11.       Assignment.  Holder may not sell, transfer, assign, pledge or grant a
security interest in this Note without the prior written consent of the Company,
which consent may be granted or withheld by the Company in its sole discretion.

 

12.       Notice.  Any notice, demand, request, consent, approval, declaration,
delivery, or other communication to be made pursuant to the provisions of this
Note shall be in writing and shall be deemed to have been validly served, given
or delivered (i) upon the earlier of actual receipt and three (3) business days
after deposit in the United States Mail, registered or certified

 

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mail, return receipt requested, with proper postage prepaid, (ii) upon
transmission, when sent by facsimile transmission (with confirmation of delivery
by the sending device) or by delivery of a copy by personal delivery, (iii) one
(1) business day after deposit with a reputable overnight courier with all
charges prepaid or (iv) when delivered, if hand-delivered by messenger, all of
which shall be addressed to the party to be notified and sent to the address or
facsimile number as follows:

 

(i)

If to the Company at:

 

 

 

Augme Technologies, Inc.

 

43 W 24th St.

 

11th Floor

 

New York, NY 10010

 

Fax: (212) 710-9359

 

Attn: CEO

 

 

with a copy to:

 

 

 

Richardson & Patel LLP

 

750 Third Avenue, 9th Floor

 

New York, New York 10017

 

Fax: (212) 591-6898

 

Attention: Kevin Friedmann, Esq.

 

 

(ii)

If to Holder at:

 

 

 

Hipcricket, Inc.

 

11241 Slater Avenue NE, Suite 201

 

Kirkland, WA 98033

 

Fax: (206) 464-0484

 

Attn: CEO

 

 

with a copy to (which shall not constitute notice):

 

 

 

Vandeberg Johnson & Gandara, LLP

 

One Union Square, Suite 2424

 

600 University Street

 

Seattle, WA 98101-1192

 

Fax: (206) 464-0484

 

Attention: Daren Nitz, Esq.

 

or to such other address (or facsimile number) as may be substituted by notice
given as herein provided.  The giving of any notice required hereunder may be
waived in writing by the party entitled to receive such notice.  Failure or
delay in delivering copies of any notice, demand, request, consent, approval,
declaration or other communication to any designated individual or entity above
to receive copies shall in no way adversely affect the effectiveness of such
notice, demand, request, consent, approval, declaration or other communication.

 

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IN WITNESS WHEREOF, the Company and Holder have caused this Note to be duly
executed and delivered as of the date first above written.

 

 

Company:

 

 

 

AUGME TECHNOLOGIES, INC.

 

 

 

 

 

 

 

By:

/s/ Paul Arena

 

 

Name: Paul Arena

 

Its:   Chief Executive Officer

 

 

Holder:

 

 

 

HIPCRICKET, INC.

 

 

 

By:

/s/ Ivan Braiker

 

 

Name:   Ivan Braiker

 

Its:   Chief Executive Officer

 

 

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