Exhibit 10.2

 

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED, OR UNDER THE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION, AND MAY NOT BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED OR OTHERWISE
DISPOSED OF EXCEPT IN COMPLIANCE WITH, OR PURSUANT TO AN EXEMPTION FROM, THE
REQUIREMENTS OF SUCH ACT OR SUCH LAWS.

 

_______________________________

 

BRAIN SCIENTIFIC INC.

 

NON-CONVERTIBLE PROMISSORY NOTE

 

 

Principal Amount: $50,000

Issue Date: 10/ 21/2019

 

 

Brain Scientific Inc., a Nevada corporation (the “Company”), for value received,
hereby promises to pay to Leonard Mazur or his permitted assigns or successors
(the “Holder”), the principal amount of Fifty Thousand Dollars ($50,000) (the
“Principal Amount”), without demand, on the Maturity Date (as hereinafter
defined). This Note shall bear interest at a fixed rate of fourteen percent
(14%) per annum, beginning on the Issue Date. Interest shall be computed based
on a 360-day year of twelve 30-day months and shall be payable quarterly. Except
as set forth in Section 3.1, payment of all principal and interest due shall be
in such coin or currency of the United States of America as shall be legal
tender for the payment of public and private debts at the time of payment.

 

This Note is a non-convertible promissory note referred to in that certain
Subscription Agreement dated as of the date hereof (the “Subscription
Agreement”), or series of like subscription agreements, among the Company and
the subscribers named therein, pursuant to which the Company is seeking to raise
an aggregate of up to $500,000 (or such higher amount in the discretion of the
Company).

 

1.     Definitions.

 

1.1     Definitions. The terms defined in this Section 1 whenever used in this
Note shall have the respective meanings hereinafter specified.

 

“Applicable Laws” means any and all applicable foreign, federal, state and local
statutes, laws, regulations, ordinances, policies, and rules or common law
(whether now existing or hereafter enacted or promulgated), of any and all
governmental authorities, agencies, departments, commissions, boards, courts, or
instrumentalities of the United States, any state of the United States, any
other nation, or any political subdivision of the United States, any state of
the United States or any other nation, and all applicable judicial and
administrative, regulatory or judicial decrees, judgments and orders, including
common law rules and determinations.

 

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“Event of Default” shall have the meaning set forth in Section 6.1.

 

“Holder” or “Holders” means the person named above or any Person who shall
thereafter become a recordholder of this Note in accordance with the terms
hereof.

 

“Issue Date” means the issue date stated above.

 

“Maturity Date” shall mean October 21, 2020

 

“Note” means this Non-Convertible Note, as amended, modified or restated.

 

“Person” means an individual, corporation, partnership, limited liability
company, association, trust, joint venture, unincorporated organization or any
government, governmental department or agency or political subdivision thereof.

 

“Securities Act” means the United States Securities Act of 1933, as amended.

 

2.     GENERAL PROVISIONS.

 

2.1     Loss, Theft, Destruction of Note. Upon receipt of evidence satisfactory
to the Company of the loss, theft, destruction or mutilation of this Note and,
in the case of any such loss, theft or destruction, upon receipt of indemnity or
security reasonably satisfactory to the Company, or, in the case of any such
mutilation, upon surrender and cancellation of this Note, the Company will make
and deliver, in lieu of such lost, stolen, destroyed or mutilated Note, a new
Note of like tenor and unpaid principal amount dated as of the date hereof. This
Note shall be held and owned upon the express condition that the provisions of
this Section 2.1 are exclusive with respect to the replacement of a mutilated,
destroyed, lost or stolen Note and shall preclude any and all other rights and
remedies notwithstanding any law or statute existing or hereafter enacted to the
contrary with respect to the replacement of negotiable instruments or other
securities without their surrender.

 

2.2     Prepayment; Redemption. This Note may not be prepaid by the Company in
whole or in part, except with the prior written consent of the Holder. This Note
may not be redeemed by the Company in whole or in part, except with the prior
written consent of the Holder.

 

3.     STATUS; RESTRICTIONS ON TRANSFER.

 

3.1     Status of Note. This Note is a direct, general and unconditional
obligation of the Company, and constitutes a valid and legally binding
obligation of the Company, enforceable in accordance with its terms subject, as
to enforcement, to bankruptcy, insolvency, reorganization and other similar laws
of general applicability relating to or affecting creditors’ rights and to
general principles of equity.    

 

4.     COVENANTS. In addition to the other covenants and agreements of the
Company set forth in this Note, the Company covenants and agrees that so long as
this Note shall be outstanding:

 

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4.1     Payment of Note. The Company will punctually, according to the terms
hereof, within thirty (30) days after the Maturity Date, pay or cause to be paid
all amounts due under this Note.

 

4.2     Notice of Default. If any one or more events occur which constitute or
which, with the giving of notice or the lapse of time or both, would constitute
an Event of Default or if the Holder shall demand payment or take any other
action permitted upon the occurrence of any such Event of Default, the Company
will forthwith give notice to the Holder, specifying the nature and status of
the Event of Default or other event or of such demand or action, as the case may
be.

 

4.3     Compliance with Laws. The Company will comply in all material respects
with all Applicable Laws, except where the necessity of compliance therewith is
contested in good faith by appropriate proceedings.

 

4.4     Use of Proceeds. The Company shall use the proceeds of this Note for
general working capital.

 

5.     REMEDIES.

 

5.1     Events of Default. “Event of Default” wherever used herein means any one
of the following events:

 

(a)     Default in the due and punctual payment of the principal of, or any
other amount owing in respect of (including interest), this Note when and as the
same shall become due and payable, subject to a thirty (30) day cure period;

 

(b)     Default in the performance or observance of any covenant or agreement of
the Company in this Note (other than a covenant or agreement a default in the
performance of which is specifically provided for elsewhere in this Section
5.1), and the continuance of such default for a period of 10 days after there
has been given to the Company by the Holder a written notice specifying such
default and requiring it to be remedied;

 

(c)     The entry of a decree or order by a court having jurisdiction adjudging
the Company as bankrupt or insolvent; or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in respect
of the Company under the Federal Bankruptcy Code or any other applicable federal
or state law, or appointing a receiver, liquidator, assignee, trustee or
sequestrator (or other similar official) of the Company or of any substantial
part of its property, or ordering the winding-up or liquidation of its affairs,
and the continuance of any such decree or order unstayed and in effect for a
period of 60 calendar days;

 

(d)     The institution by the Company of proceedings to be adjudicated as
bankrupt or insolvent, or the consent by it to the institution of bankruptcy or
insolvency proceedings against it, or the filing by it of a petition or answer
or consent seeking reorganization or relief under the Federal Bankruptcy Code or
any other applicable federal or state law, or the consent by it to the filing of
any such petition or to the appointment of a receiver, liquidator,

 

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assignee, trustee or sequestrator (or other similar official) of the Company or
of any substantial part of its property, or the making by it of an assignment
for the benefit of creditors; 

 

(e)     The Company seeks the appointment of a statutory manager or proposes in
writing or makes a general assignment or an arrangement or composition with or
for the benefit of its creditors or any group or class thereof or files a
petition for suspension of payments or other relief of debtors or a moratorium
or statutory management is agreed or declared in respect of or affecting all or
any material part of the indebtedness of the Company; or

 

(f)     It becomes unlawful for the Company to perform or comply with its
obligations under this Note.

 

5.2     Effects of Default. If an Event of Default occurs and is continuing,
then and in every such case the Holder may declare this Note to be due and
payable immediately, by a notice in writing to the Company, and upon any such
declaration, the Company shall pay to the Holder the outstanding principal
amount of this Note plus all accrued and unpaid interest through the date the
Note is paid in full.

 

5.3     Remedies Not Waived; Exercise of Remedies. No course of dealing between
the Company and the Holder or any delay in exercising any rights hereunder shall
operate as a waiver by the Holder. No failure or delay by the Holder in
exercising any right, power or privilege under this Note shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be cumulative and not
exclusive of any rights or remedies provided by Applicable Law. By acceptance
hereof, the Holder acknowledges and agrees that this Note is one of a series of
Non-Convertible Promissory Notes of similar tenor issued by the Company
(collectively, the “Related Notes”) and that upon the occurrence and during the
continuance of any Event of Default, the holders of a majority in original
principal amount of the Related Notes shall have the right to act on behalf of
the holders of all such Notes in exercising and enforcing all rights and
remedies available to all of such holders under this Note, including, without
limitation, foreclosure of any judgment lien on any assets of the Company. By
acceptance hereof, the Holder agrees not to independently exercise any such
right or remedy without the consent of the holders of a majority in original
principal amount of the Related Notes.

 

6.     SUBORDINATION.

 

6.1     The Company agrees and the Holder, by acceptance of this Note, agrees,
expressly for the benefit of the present and future holders of Senior
Indebtedness (as defined below), that, except as otherwise provided herein, upon
(a) an event of default under any Senior Indebtedness (as defined below), or (b)
any dissolution, winding up or liquidation of the Company, whether or not in
bankruptcy, insolvency or receivership proceedings, the Company shall not pay,
and the Holder shall not be entitled to receive, any amount in respect of the
principal and interest of such Note unless and until the Senior Indebtedness
shall have been paid or otherwise discharged. For purposes of this Note, “Senior
Indebtedness” shall mean, unless expressly subordinated to or made on a parity
with the amounts due under this Note, the principal of (and premium, if any),
unpaid interest on and amounts reimbursable, fees, expenses,

 

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costs of enforcement and other amounts due in connection with, indebtedness for
borrowed money of the Company, to banks, insurance companies, commercial finance
lenders, leasing or equipment financing institutions or other regulated lending
institutions (excluding any indebtedness convertible into equity securities of
the Company). Upon (i) an event of default under any Senior Indebtedness, or
(ii) any dissolution, winding up or liquidation of the Company, any payment or
distribution of assets of the Company, which the Holder would be entitled to
receive in respect of the Note but for the provisions hereof, shall be paid by
the liquidating trustee or agent or other person making such payment or
distribution directly to the holders of Senior Indebtedness ratably according to
the aggregate amounts remaining unpaid on Senior Indebtedness after giving
effect to any concurrent payment or distribution to the holders of Senior
Indebtedness. Subject to the payment in full of the Senior Indebtedness and
until this Note is paid in full, the Holder shall be subrogated to the rights of
the holders of the Senior Indebtedness (to the extent of payments or
distributions previously made to the holders of Senior Indebtedness pursuant to
this Section 6.1 to receive payments or distributions of assets of the Company
applicable to the Senior Indebtedness).

 

6.2     Nothing in this Section 6 is intended to impair, as between the Company,
its creditors (other than the holders of Senior Indebtedness) and the Holder,
the unconditional and absolute obligation of the Company to pay the principal of
and interest on this Note or affect the relative rights of the Holder and the
other creditors of the Company, other than the holders of Senior Indebtedness.
Nothing in this Note shall prevent the Holder from exercising all remedies
otherwise permitted by applicable law upon default under the Note, subject to
the rights, if any, of the holders of Senior Indebtedness in respect to cash,
property or securities of the Company received upon the exercise of any such
remedy.

 

7.     MISCELLANEOUS.

 

7.1     Severability. If any provision of this Note shall be held to be invalid
or unenforceable, in whole or in part, neither the validity nor the
enforceability of the remainder hereof shall in any way be affected.

 

7.2     Notice. Where this Note provides for notice of any event, such notice
shall be given (unless otherwise herein expressly provided) in writing and
either (a) delivered personally, (b) sent by certified, registered or express
mail, postage prepaid or (c) sent by facsimile or other electronic transmission,
and shall be deemed given when so delivered personally, sent by facsimile or
other electronic transmission (confirmed in writing) or mailed. Notices shall be
addressed, if to Holder, to its address as provided in the Subscription
Agreement or, if to the Company, to its principal office.

 

7.3     Governing Law. This Note shall be governed by, and construed in
accordance with, the laws of the State of New York (without giving effect to any
conflicts or choice of law provisions that would cause the application of the
domestic substantive laws of any other jurisdiction).

 

7.4     Forum. The Holder and the Company hereby agree that any dispute which
may arise out of or in connection with this Note shall be adjudicated before a
court of competent jurisdiction in the State of New York and they hereby submit
to the exclusive

 

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jurisdiction of the federal or state courts of the State of New York, as well as
to the jurisdiction of all courts to which an appeal may be taken from such
courts, with respect to any action or legal proceeding commenced by either of
them and hereby irrevocably waive any objection they now or hereafter may have
respecting the venue of any such action or proceeding brought in such a court or
respecting the fact that such court is an inconvenient forum.

 

7.5     Headings. The headings of the Articles and Sections of this Note are
inserted for convenience only and do not constitute a part of this Note.

 

7.6     Amendments. This Note may be amended or waived only with the written
consent of the Company and the holders of a majority in original aggregate
principal amount of the Related Notes. Any such amendment or waiver shall be
binding on all holders of the Notes, even if they do not execute such consent,
amendment or waiver.

 

7.7     No Recourse Against Others. The obligations of the Company under this
Note are solely obligations of the Company and no officer, employee or
stockholder shall be liable for any failure by the Company to pay amounts on
this Note when due or perform any other obligation.

 

7.8     Assignment; Binding Effect. This Note may be assigned by the Company
without the prior written consent of the Holder. This Note shall be binding upon
and inure to the benefit of both parties hereto and their respective permitted
successors and assigns.

 

Signature on the Following Page

 

 

 

 

 

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In Witness Whereof, the Company has caused this Note to be signed by its duly
authorized officer on the date hereinabove written.

 

Brain Scientific Inc.

 

By:                                       

Name: Boris Goldstein

Title:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Signature Page to Non-Convertible Promissory Note