Unassociated Document


    

      THIS
        PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
        AS
        AMENDED, OR THE SECURITIES LAWS OF ANY STATE. THE SECURITIES HAVE BEEN ACQUIRED
        FOR INVESTMENT AND MAY NOT BE SOLD, ASSIGNED, TRANSFERRED OR OTHERWISE DISPOSED
        OF EXCEPT IN COMPLIANCE WITH SUCH ACT AND LAWS. 

      


      PROMISSORY
        NOTE

      


      
        	
                $846,830.89

              	
                November
                  16,
                  2007                                      
                  

              


      

      


      FOR
        VALUE RECEIVED,
        the
        undersigned, TSSS,
        INC., a
        Delaware Corporation (the “Maker”), promises to pay in lawful money of the
        United States to the order of Jonathan
        Ilan Ofir,
        (the
“Payee”) the principal sum of Eight Hundred Forty Six Thousand Eight Hundred and
        Thirty and 89/100 ($846,830.89) Dollars (the “Principal Amount”), or such lesser
        amount as may be outstanding from time to time, plus interest to accrue at
        the
        rate of one percent (1%) per month, no later than May 14, 2008 (the “Maturity
        Date”).

       

      Maker
        shall have the right to prepay all or any portion of the then outstanding
        Principal Amount and accrued interest thereon at any time without penalty
        or
        premium. Simultaneously with any prepayment of principal, there must also
        be
        paid all interest accrued on the amount of principal so prepaid and all other
        sums then due hereunder or under any instrument, document or other writing
        now
        or hereafter securing or pertaining to this Promissory Note. All payments
        hereunder when paid shall be applied first to the payment of all accrued
        interest and the balance shall be applied to principal.

       

      In
        case
        one or more of the following events (each, an “Event of Default”)(whatever the
        reason for such Event of Default and whether it shall be voluntary or
        involuntary or be effected by operation of law or pursuant to any judgment,
        decree or order of any court or any order, rule or regulation of any
        administrative or governmental body) shall have occurred and be
        continuing:

      


      a. Default
        in the payment, when due or declared due, of any principal or interest payments
        hereunder.

      


      b. Maker
        makes a general assignment for the benefit of creditors; or, in the absence
        of
        such application, consent, acquiescence or action, a trustee, receiver or
        other
        custodian is appointed for Maker; or for a substantial part of the property
        of
        Maker; or any bankruptcy, reorganization, debt arrangement or other proceeding
        under any bankruptcy or insolvency law, or any dissolution or liquidation
        proceeding, is authorized or instituted by, or instituted against, Maker;
        or any
        warrant of attachment or similar legal process is issued against any substantial
        part of the property of Maker.

      


      c. Any
        representation or warranty made by Maker under the Purchase Agreement dated
        the
        date hereof, this Promissory Note or the Assignment and Indemnification
        Agreement (collectively, the “Transaction Documents”) shall be untrue or
        misleading in any material respect when made.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      d. Maker
        shall have breached any of its covenants and agreements hereunder or in any
        of
        the Transaction Documents.

      


      then,
        in
        each case where an Event of Default occurs, the Payee, by notice in writing
        to
        Maker shall inform Maker of such Event of Default and if such default is
        not
        cured within three business days from the date such notice is received by
        Maker,
        then Payee, may, at its option, declare the outstanding Principal Amount
        to be
        due and payable immediately, and upon any such declaration the same shall
        become
        immediately due and payable. 

      


      Upon
        the
        occurrence and continuance of an Event of Default (hereafter defined) (whatever
        the reason for such Event of Default and whether it shall be voluntary or
        involuntary or be effected by operation of law or pursuant to any judgment,
        decree or order of any court or any order, rule or regulation of any
        administrative or governmental body), interest shall accrue on the unpaid
        balance of the Principal Amount at a rate of two percent (2%) per month (the
        “Default Interest Rate”).

      


      Notwithstanding
        any provision contained herein, the total liability of Maker for payment
        of
        interest pursuant hereto, including late charges, shall not exceed the maximum
        amount of such interest permitted by law to be charged, collected, or received
        from Maker, and if any payments by Maker include interest in excess of such
        a
        maximum amount, Payee shall apply such excess to the reduction of the unpaid
        principal amount due pursuant hereto, or if none is due, such excess shall
        be
        refunded.

      


      This
        Promissory Note shall be binding upon and inure to the benefit of and be
        enforceable by the respective successors and assigns of the Maker and
        Payee.

      


      All
        notices, requests, claims, demands and other communications given or made
        pursuant hereto shall be in writing and shall be deemed to have been duly
        given
        if delivered in person against written receipt, by facsimile transmission,
        overnight courier prepaid, or mailed by prepaid first class registered or
        certified mail, postage prepaid, return receipt requested to the respective
        parties at the following addresses (or at such other address for a party
        as
        shall be specified in a notice given in accordance with this
        Section):

       

      

        
          	
                  (a)

                	
                  If
                    to the Maker:

                
	 	 	 
	 	
                  TSSS,
                    Inc.

                
	 	 

	 	 

	 	
                  Telecopy:  

                	 

	 	 	 
	 	 	 
	
                  (b)

                	
                  If
                    to Payee:

                
	 	 
	 	 
	 	 
	 	 


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      All
        such
        notices, requests and other communications will (i) if delivered personally
        to
        the address as provided in this Section, be deemed given upon delivery, (ii)
        if
        delivered by facsimile transmission to the facsimile number as provided in
        this
        Section, be deemed given upon receipt, (iii) if delivered by overnight courier
        to the address as provided in this Section, be deemed given on the earlier
        of
        the first business day following the date sent by such overnight courier
        or upon
        receipt or (iv) if delivered by mail in the manner described above to the
        address provided in this Section, be deemed given on the earlier of the third
        business day following mailing or upon receipt.

      


      No
        right
        or remedy herein conferred upon or reserved to Payee, Inc. is intended to
        be
        exclusive of any other right or remedy, and every right and remedy shall,
        to the
        extent permitted by law, be cumulative and in addition to every other right
        and
        remedy given hereunder or now or hereafter existing at law or in equity or
        otherwise. The assertion or employment of any right or remedy hereunder,
        or
        otherwise, shall not prevent the concurrent assertion or employment of any
        other
        appropriate right or remedy.

      


      The
        undersigned hereby waives presentment, demand, notice, protest and all other
        demands and notices in connection with the delivery, acceptance, performance
        and
        enforcement of this Promissory Note, except as specifically provided herein,
        and
        assent to extensions of the time of payment, or forbearance or other indulgence
        without notice.

      


      The
        undersigned shall pay all expenses, including reasonable attorney fees, incurred
        or paid by the holder of this Promissory Note in attempting to collect funds
        due
        under this Promissory Note. In the event that an action is instituted for
        the
        collection of this Promissory Note, the prevailing party shall be entitled
        to
        recover, at trial or on appeal, such sums as the court may adjudge reasonable
        as
        attorney fees, in addition to costs and necessary disbursements.

      


      This
        Promissory Note is to be governed by and construed in accordance with the
        laws
        of the State of New York. In any action brought under or arising out of this
        Promissory Note, the Maker hereby consents to the in personam jurisdiction
        of
        any state or federal court sitting in New York, New York, waives any claim
        or
        defense that such forum is not convenient or proper, and consents to service
        of
        process by any means authorized by New York law.

      

        
          	 	
                  TSSS,
                    INC.

                	 
	 	 	 	 
	
                   

                	
                  By:
                    

                	
                  /s/
                    Ofer Arbib

                	 
	
                   

                	
                  Name:  

                	
                  Ofer
                    Arbib

                	 
	
                   

                	
                  Title:
                    

                	
                  Member
                    of the Board