Unassociated Document


    THIS NOTE
HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE SOLD
OR OTHERWISE TRANSFERRED BY ANY PERSON, INCLUDING A PLEDGEE, UNLESS (1) EITHER
(A) A REGISTRATION STATEMENT WITH RESPECT THERETO SHALL BE EFFECTIVE UNDER THE
SECURITIES ACT, OR (B) THE COMPANY SHALL HAVE RECEIVED AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT IS AVAILABLE, AND (2) THERE SHALL HAVE BEEN COMPLIANCE WITH ALL
APPLICABLE STATE SECURITIES OR “BLUE SKY” LAWS.

    


    INTELLECT
NEUROSCIENCES, INC.

    


    FORM
OF PROMISSORY NOTE

    
       

      
        
          
            
              	
                      $______

                    	
                      New York, New York

                    
	 	
                      _________,
      2009

                    


            

          

        

         

         

      

    

    INTELLECT NEUROSCIENCES, INC.,
a Delaware corporation (the “Company”), for value received, hereby promises to
pay to NAME, or its
assigns (the “Payee”), the principal sum of INSERT AMOUNT ($XXXXX)
together with all interest accruing hereunder and all other costs and fees
accruing hereunder in cash no later than six (6) months from the date hereof;
provided, however, that in the
event that a Liquidity Event (as defined below) occurs earlier than the
expiration of such six month period,  then the full principal amount
together with any interest due and outstanding shall become due and payable in
full no later than five business days following the Liquidity Event
(hereinafter, the expiration of such six month period or the fifth business day
following the occurrence of a Liquidity Event, whichever is earlier, is referred
to as the "Due Date")  Interest shall accrue on the unpaid principal
balance at an annual interest rate of ten percent (10%).  All such
accrued interest shall be payable at the same time that the Company pays any
principal amount of this Note.

     

    A
“Liquidity Event” shall mean the receipt by the Company of cash proceeds in an
amount of at least $1,125,000 from the sale of Company common stock. The Company
agrees to notify Payee of the occurrence of a Liquidity Event no later than two
business days after it has occurred.

     

    The
Company and all endorsers of this Note hereby waive presentment, demand, protest
and notice.  Payee shall, promptly upon full payment by the Company of
the principal of and interest on this Note, together with all costs and
expenses, if any, due hereon, surrender this Note to the Company for retirement
and cancellation, provided, however, that to the
extent the Company makes a payment or payments to Payee, which payment or
payments or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside, and/or required to be repaid to a
trustee, receiver, or any other party under the United States Bankruptcy Code,
as amended, or any other applicable law, common law, or equitable causes (a
"Voidable Transfer") and Payee is required to repay or restore any such Voidable
Transfer or the amount or any portion thereof, or upon the advice of its counsel
is advised to do so, then as to any such Voidable Transfer or the amount repaid
or restored (including all costs, expenses and attorneys' fees of Payee related
thereto), the liability of the Company shall automatically be revived,
reinstated and restored and shall exist in full force and effect as though such
Voidable Transfer had never been made.

     

    
      
        
        

      

      
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    Should
the indebtedness evidenced by this Note or any part thereof be collected in any
proceeding at law, or this Note be placed in the hands of an attorney for
collection after default by the Company in making any payment of principal and
interest hereunder, the Company agrees to pay all costs of collecting the
balance due under this Note, including reasonable attorneys' fees and expenses
and court costs, if any.

     

    1. Event of
Default.  In the case of an Event of Default (as defined below)
as specified in clauses (i) or (ii) of the definition thereof, the principal of
and accrued and unpaid interest on the Note shall ipso facto become and be
immediately due and payable without any declaration or other act on the part of
any holder of this Note.  In the case of an Event of Default as
specified in clauses (iii) or (iv) of the definition thereof, Payee may, at its
option, by notice to the Company, declare this Note to be immediately due and
payable together with interest accrued thereon.  For purposes hereof,
“Event of Default” means the occurrence of any of the following:

     

    (i) the
entry of a decree or order for relief by a court having jurisdiction in the
premises in respect of the Company in an involuntary case under any bankruptcy
laws, as now constituted or hereafter amended, or any other
applicable  bankruptcy, insolvency or other similar laws, or
appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator
(or similar official) of the Company or for any substantial part of the
Company’s property, or ordering the winding-up or liquidation of any of
Company’s affairs and the continuance of any such decree or order unstayed and
in effect for a period of 30 consecutive days;

     

    (ii) the
commencement by the Company of a voluntary case under any applicable bankruptcy
laws, as now constituted or hereafter amended, or any other applicable
bankruptcy, insolvency or other similar laws, or the consent by the Company to
the appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) of the Company or for any
substantial part of the Company’s property, or the making by any of them of any
assignment for the benefit of creditors;

     

    (iii)  default
of any covenant, condition or agreement on the part of the Company in the Note,
which default is not cured within 5 days of the date of written notice thereof
to the Company by Payee, provided, however, that, notwithstanding the foregoing,
failure of the Company to make payment in full hereunder on the Due Date shall
immediately constitute an Event of Default with no further action required on
the part of the Payee; or

     

    
      
        
        

      

      
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    (iv)  the
breach of any representation or warranty made by the Company in the Note, which
breach is not cured within five (5) business days of receipt by the Company of
notice of such breach sent by the Payee.

     

    2. Loss, Theft or Destruction
of Note.  Upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft or destruction of this Note, the Company
will make and deliver a new Note which shall carry the same rights to interest
(unpaid and to accrue) carried by this Note, stating that such Note is issued in
replacement of this Note, making reference to the original date of issuance of
this Note (and any successors hereto) and dated as of such cancellation, in lieu
of this Note.

     

    3.  Guaranty.  In
order to secure the payment and performance of all obligations of the Company
now or hereafter existing under this Note, Margie Chassman (the “Guarantor”)
hereby unconditionally guarantees full and timely payment of all amounts due and
owing under this Note. The Payee acknowledges that this guaranty is not secured
by the granting of a security interest in any assets of the Guarantor, the
Company or any other person or entity.

     

    4. Miscellaneous.

     

    (a) Issue
Date.  The provisions of this Note shall be construed and shall
be given effect in all respect as if it had been issued and delivered by the
Company on the date hereof.

     

    (b) Governing
Law.  This Note shall be governed by and construed in
accordance with the laws of the State of New York without regard to principles
of conflict of laws.  Any action brought by either party against the
other concerning the transactions contemplated by this Note shall be brought
only in the state courts of New York or in the federal courts located in the
state of New York.  All parties and the individuals executing this
Note and other agreements on behalf of the parties agree to submit to the
jurisdiction of such courts and waive trial by jury.  In the event
that any provision of this Note or any other agreement delivered in connection
herewith is invalid or unenforceable under any applicable statute or rule of
law, then such provision shall be deemed inoperative to the extent that it may
conflict therewith and shall be deemed modified to conform with such statute or
rule of law.  Any such provision which may prove invalid or
unenforceable under any law shall not affect the validity or enforceability of
any other provision of any agreement.

     

    (c) Assignment.  Neither
this Note nor any of the rights, interests or obligations hereunder may be
assigned, by operation of law or otherwise, in whole or in part by Company to
any person or entity without the prior written consent of Payee.

     

    (d) Notices.  Any
notice, request or other communications required or permitted hereunder shall be
given upon personal delivery, by certified first class mail, postage prepaid or
by a nationally known overnight courier service and addressed to the parties as
follows:

     

    
      
        
        

      

      
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              To the
      Company: 

            	
              Intellect
      Neurosciences, Inc.

              
                7
      West 18th Street, 9th Floor

                New
      York, New York 10011, USA

                Att:
      Elliot Maza, Chief Financial
Officer

              

            


    

    
       

      
        	 	
                To the
      Guarantor: 

              	
                

                  Margie
      Chassman

                  445
      West 23rd Street

                  New
      York, New York 10011

                

              


      

      
         

        
          	 	
                  

                    To
      Payee:

                  

                	
                  

                    

                      Insert
      name and address

                    

                  

                


        

        
        

      

    

    or to
such other single place as any single addressee shall designate by written
notice to the other addressee.  Any notice, request or other
communications required or permitted hereunder shall be deemed to have been
given or made three (3) business days after being deposited by registered mail
with proof of delivery, or, in the case of notice by overnight courier service,
the next business day.

     

    (e) Enforcement;
Expenses.  The Company shall pay all fees and expenses, including
attorney’s fees, incurred by Payee in the enforcement in any of the Company’s
obligations hereunder not performed when due.

     

    IN WITNESS WHEREOF, the
undersigned has caused this Promissory Note to be executed on the date first
written above.

    
       

      
        
          
            	
                     

                  	
                    
                      INTELLECT
      NEUROSCIENCES, INC.

                       

                       

                      By
      _____________________________                                                                

                      Name:
      Elliot Maza

                      Title:   Chief
      Financial Officer

                       

                       

                       

                      THE
      GUARANTOR (as to the obligations under Section 3 of this
Note)

                       

                       

                      By
      _____________________________                                                                

                      Name:
      Margie Chassman

                    

                  


          

        

        
           

          
            
              
              

            

            
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