EXHIBIT 10.7

 

DEMAND PROMISSORY NOTE

 

NEITHER THIS NOTE NOR THE SHARES OF COMMON STOCK OR ANY OTHER SECURITIES
ISSUABLE UPON CONVERSION OF THIS NOTE HAVE BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED. THIS NOTE HAS BEEN ACQUIRED, AND ANY SHARES OF COMMON
STOCK OR ANY OTHER SECURITIES ISSUABLE UPON CONVERSION OF THE AMOUNTS
OUTSTANDING UNDER THIS NOTE ARE REQUIRED TO BE ACQUIRED, FOR INVESTMENT PURPOSES
AND NOT WITH A VIEW TO DISTRIBUTION OR RESALE, AND MAY NOT BE SOLD, ASSIGNED,
PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT FOR THIS NOTE AND/OR SUCH SHARES OR OTHER SECURITIES UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS OR AN
OPINION OF COUNSEL SATISFACTORY TO THE ISSUER OF THIS NOTE AND SUCH SHARES OR
OTHER SECURITIES TO THE EFFECT THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT
AND SUCH STATE SECURITIES LAWS.

 

Artec Global Media, Inc.

12% Convertible Promissory Note

 

Dated: February 5, 2016

Principal Amount: $100,000

San Diego, Ca.

 

For Value Received, the undersigned, Artec Global Media, Inc. (together with its
successors and assigns, the "Company"), a Nevada corporation, hereby promises to
pay to the order of Search4.Com, Inc. (the "Lender") or registered assignees
(Lender or such assignees shall be referred to herein collectively as the
"Holder"), the principal sum of One Hundred Thousand dollars ($100,000) set
forth below. Prior to the Maturity Date, the Company agrees to pay the principal
amount evidenced by this Note plus all unpaid interest due hereunder not later
than seven (7) days after written DEMAND is sent to the Company at the address
set forth herein by first class mail.

 

1. Interest Rate. Until an Event of Default shall have occurred, the principal
amount evidenced by this Note shall bear interest at the rate of 12% per annum,
interest on this Note shall be compounded daily (the "Applicable Interest
Rate"). Upon the occurrence of an Event of Default, the outstanding principal
amount and any accrued but unpaid interest thereon shall thereafter bear
interest until paid at the greater of (a) 16%, or (b) the maximum legal rate of
interest available under the laws of the State of Wisconsin (the "Default
Interest Rate").

 

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2. Payment Date; Payment Method.

 

(a) Payment Dates. Unless payment is made by the Company pursuant to a written
DEMAND received from Holder, the outstanding principal amount evidenced by this
Note (and any accrued but unpaid interest thereon) shall be paid by, or on
February 5, 2017 (the "Maturity Date"). Upon payment in full of the principal
evidenced by this Note (and any accrued but unpaid interest thereon), Lender, by
Lender's acceptance of this Note, agrees to mark this Note "CANCELLED" and
return this Note as so marked to the Company within five Business Days after
such payment in full is received. For purposes of this Note, the term "Business
Day" shall mean any day other than a Saturday, Sunday or a day on which banking
institutions in the State of New York are authorized or obligated by law or
executive order to close. This Note may be prepaid by the Company, and at the
Company's sole discretion, without penalty in whole or in part at any time upon
ten days' prior written notice to Holder, provided that such prepayment includes
any accrued but unpaid interest thereon through the date of prepayment.

 

(b) Payment Method. Payment of the principal evidenced by this Note (and any
accrued but unpaid interest thereon) shall be made by check, subject to
collection, tendered to Holder, via postage paid, first class mail, at the
address for the giving of notices as set forth in Section 10 of this Note.

 

3. Default; Acceleration.

 

(a) Any of the following shall constitute an "Event of Default" under this Note:

 

(i) the failure by the Company to pay any amounts required to be paid under this
Note on or before the date on which such payment was due;

 

(ii) the breach or noncompliance by the Company of any of its material
representations, warranties or covenants contained herein or in the Agreement;

 

(iii) the Company shall

 

(A) apply for or consent to the appointment of a receiver or trustee of the
Company's assets,

 

(B) make a general assignment for the benefit of creditors,

 

(C) file a petition or other request no matter how denominated ("Petition")
seeking relief under Title 11 of the United States Code or under any other
federal or state bankruptcy, reorganization, insolvency, readjustment of debt,
dissolution or liquidation law or statute ("Bankruptcy Statute"), or

 

(D) file an answer admitting the material allegations of a Petition filed
against it in any proceeding under any Bankruptcy Statute;

 

(iv) there shall have entered against the Company an order for relief under any
Bankruptcy Statute; or

 

(v) a Petition seeking an order for relief under any Bankruptcy Statute is filed
by any one other than the Company and without the Company's consent or agreement
which is not dismissed or stayed within 60 days after the date of such filing,
or such Petition is not dismissed upon the expiration of any stay thereof.

 

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(b) Upon the occurrence of an Event of Default, the unpaid principal amount
evidenced by this Note (and any accrued but unpaid interest thereon) shall be
immediately due and payable.

 

(c) Until the occurrence of an Event of Default, the principal amount evidenced
by this Note shall bear interest at the Applicable Interest Rate and upon an
Event of Default, any unpaid principal amount under this Note and any accrued
but unpaid interest through the date of effectiveness of such Event of Default
shall bear interest until paid at the Default Interest Rate.

 

4. Conversion Right.

 

(a) Voluntary Conversion. Provided that the Holder does not exercise its right
to DEMAND payment of the principal amount evidenced by this Note plus all
accrued and unpaid interest, the Holder of this Note has the right, at the
Holder's option and at any time following the date of this Note and before the
Maturity Date, to convert the principal balance of this Note (plus all accrued
and unpaid interest under this Note), in accordance with the procedures
contained in Section 4(b) hereof, in whole or in part, into a number of fully
paid and non-assessable shares of the common stock, at the lesser of par value
$0.001 per share or 50% discount of the lowest closing price of the previous 10
days (the "Common Stock"), of the Company at the Conversion Price (as defined
below). The number of shares of Common Stock into which this Note may be
converted ("Conversion Shares") pursuant to this Section 4(a) shall be
determined by dividing the aggregate principal amount together with all accrued
and unpaid interest thereon as of the date of conversion, by the Conversion
Price. "Conversion Price" shall mean the lesser of $0.001 the value per share or
50% of the lowest bid of previous 10 trading days at the time of conversion.

 

(b) Conversion Procedure. Before the Holder shall be entitled to convert this
Note into Conversion Shares, it shall surrender this Note at the office of the
Company and shall give written notice by email, to the Company an its principal
corporate officer, of the election to convert the same pursuant to Section 4(a),
and shall state therein the name or names in which the certificate or
certificates for shares of Common Stock are to be issued. The Company shall, as
soon as practicable thereafter, issue and deliver at such office to the Holder
of this Note a certificate or certificates for the number of shares of Common
Stock to which the Holder of this Note shall be entitled. Such conversion shall
be deemed to have been made immediately prior to the close of business on the
date of such surrender of this Note, and the person or persons entitled to
receive the Conversion Shares issuable upon such conversion shall be treated for
all purposes as the record holder or holders of the shares of Common Stock as of
such date. At no time may any conversion right be exercised, if such conversion
would caused the converting party to become a greater than 9.99% shareholder of
the Company; provided, however, that a partial conversion may be completed,
whereby that individual may remain a less than 9.99% holder.

 

(c) Fractional Shares. No fractional shares of Common Stock shall be issued upon
conversion of indebtedness evidenced by this Note. Instead of any fractional
shares of Common Stock which would otherwise be issuable upon conversion, the
Company shall pay a cash adjustment in respect of such fractional share in an
amount equal to the product resulting from multiplying (i) the Conversion Price
by (ii) such fractional share.

 

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(d) Liability for Taxes on Conversion Shares. The Company shall pay all
documentary, stamp and other transactional taxes attributable to the issuance of
Conversion Shares or other securities issuable upon conversion of any portion of
the principal and accrued interest evidenced by this Note if issued in the name
of Holder. In all other cases, such taxes shall be paid by Holder.

 

(e) Reservation of Conversion Shares. The Company shall reserve, free from
preemptive rights, out of its authorized but unissued shares of Common Stock a
number of shares equal to 400% of the value of the Conversion at all times of
Common Stock for issuance as Conversion Shares.

 

(f) Status of Conversion Shares. All Conversion Shares which may be is-sued in
connection with the conversion provisions set forth -in this Section 4 will,
upon delivery by the Company, be duly and validly issued, fully paid and
non-assessable, with no personal liability attaching to the ownership of such
Conversion Shares, and free from all taxes, liens or charges with respect
thereto and not subject to any preemptive rights.

 

5. Assignment. This Note is not assignable by the Company, and any purported
assignment of this Note shall be null and void and of no effect. This Note is
assignable by the Holder in compliance with applicable federal and state
securities laws.

 

6. Waiver and Amendment. Any provision of this Note may be amended, waived or
modified upon the written consent of the Company and the Holder.

 

7. Usury. This Note is hereby expressly limited so that in no event whatsoever,
whether by reason of acceleration of maturity of the loan evidenced hereby or
otherwise, shall the amount paid or agreed to be paid to the Holder hereunder
for the loan, use, forbearance or retention of money exceed that permissible
under applicable law. If at any time the performance of any provision of this
Note or of any other agreement or instrument entered into in connection with
this Note involves a payment exceeding the limit of the interest that may be
validly charged for the loan, use, forbearance or detention of money under
applicable law, then automatically and retroactively, ipso facto, the obligation
to be performed shall be reduced to such limit, it being the specific intent of
the Company and the Holder that all payments under this Note are to be credited
first to interest as permitted by law, but not in excess of (a) the agreed rate
of interest set forth herein or therein or (b) that permitted by law, whichever
is the lesser, and the balance toward the reduction of principal. The provisions
of this Section 7 shall never be superseded or waived and shall control every
other provision of this Note and all other agreements and instruments between
the Company and the Holder entered into in connection with this Note.

 

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8. Governing Law. This Note and all rights and obligations hereunder shall be
governed by and construed in accordance with the laws of the State of California
applicable to agreements made and be performed wholly within such State, without
regard to such State's conflicts of laws principles.

 

9. Notices. All requests, demands, notices and other communications required or
otherwise given under this Note shall be sufficiently given if (a) delivered by
hand, against written receipt therefore, (b) forwarded by overnight courier
requiring acknowledgment of receipt or (c) mailed by postage prepaid, registered
or certified mail, return receipt requested, addressed as follows:

 

If to the Company, to:

Artec Global Media, Inc.

        249 South Highway 101 #324 

Solana Beach CA 92075 

Attn: Caleb Wickman, President

 

or, in the case of any of the parties hereto, at such other address as such
party shall have furnished in writing, in accordance with this Section 10, to
the other parties hereto. Each such request, demand, notice or other
communication shall be deemed given (a) on the date of delivery by hand, (b) on
the first business day following the date of delivery to an overnight courier or
(c) three business days following mailing by registered or certified mail.

 

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IN WITNESS WHEREOF, this Note has been duly executed and delivered as of the
date first above written.

 

 

Artec Global Media, Inc.  

 

 

 

 

By:

 

Name:

Caleb Wickman

Title:

President and CEO 

Search4.com, Inc.

 By:

Mark Scharbo, President

 

 

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