Exhibit 10.1


 


 


THIS REVOLVING PROMISSORY NOTE HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE,
AND HAS BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE
OR DISPOSITION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL FOR THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAWS.


______________________________________________________________________________


 


 


$150,000.00December 14, 2011


Woodland Hills, California


 


 


REVOLVING PROMISSORY NOTE


 


In consideration of such
advances (hereinafter “Advance” or “Advances”) as W-NET FUND I, L.P., a Delaware limited
partnership, or its assigns (collectively, “Holder”), from time to time may make hereon to or for the benefit
of PHOTOTRON HOLDINGS, INC., a Delaware corporation (the “Company”), pursuant to the Revolving Credit
Commitment (as defined below), including the Advance of Thirty Thousand Dollars ($30,000) made by Holder to the Company on or about
November 8, 2011, the Company hereby promises to pay to Holder the principal amount of all Advances, together with accrued interest
thereon from the date of such Advances, all subject to the terms and conditions set forth below.


 


1.Revolving
Credit Commitment.


 


1.1Advances.
The Holder agrees to make Advances to the Company from time to time during the Revolving Credit Commitment Period (as defined below),
at its sole discretion, in an aggregate principal amount at any one time outstanding which does not exceed One Hundred and Fifty
Thousand Dollars ($150,000.00) (the “Revolving Credit Commitment”). During the Revolving Credit Commitment Period,
the Company may use the Revolving Credit Commitment by borrowing, prepaying any Advances in whole or in part, and re-borrowing,
all in accordance with the terms and conditions hereof.


 


1.2Interest.
Interest shall accrue from the date of any Advances on any principal amount withdrawn, and on accrued and unpaid interest thereon,
at the rate of twelve percent (12%) per annum (calculated on the basis of a three hundred sixty-five (365) day year for the actual
number of days elapsed), compounded annually.


 



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2.Revolving
Credit Commitment Period. The revolving credit commitment period (the “Revolving Credit Commitment Period”)
shall commence as of the date hereof and shall expire on December 31, 2012 (the “Expiration Date”).


 


3.Procedure for Revolving Credit Advances.


 


3.1Advance
Request. The Company may request Advances under the Revolving Credit Commitment during the Revolving Credit Commitment Period
on any day of the week, Monday through Friday, 9:00 a.m. through 5:00 p.m., Pacific Time, (hereinafter referred to as any “Business
Day” or “Business Days”), provided that the Company shall give Holder irrevocable notice (which
notice must be received by Holder prior to 12:00 p.m., Pacific Time) one (1) Business Day prior to the requested Advance date,
specifying (i) the amount of the Advance, and (ii) the requested Advance date. Each Advance under the Revolving Credit Commitment
shall be in an amount equal to $5,000 or a whole multiple of $5,000 in excess thereof. Upon receipt of any such notice from the
Company, Holder may (but shall not be required to), at Holder’s sole discretion, make the amount of the Advance available
prior to 12:00 p.m., Pacific Time, on the Advance date requested by the Company in funds immediately available to the Company.


 


3.2Account
Evidencing Indebtedness. Holder shall maintain in accordance with its usual practice an account or accounts evidencing indebtedness
of the Company to Holder resulting from each Advance from time to time, including the amounts of principal and interest payable
and paid to the Holder from time to time under this Revolving Promissory Note (“Note”).


 


4.Repayment Procedure.


 


4.1General.
Repayment on any Advances shall be made in lawful tender of the United States. Any payments on this Note made during the Revolving
Credit Commitment Period shall be credited first to any interest due and the remainder to principal.


 


4.2Repayment of
Principal and Interest. All outstanding and unpaid principal, and all outstanding and accrued unpaid interest, shall become
due and payable on and as of the Expiration Date.


 


4.3Optional Prepayment.
The Company may, at any time and from time to time and without penalty, prepay all or any portion of the accrued and unpaid interest
on this Note and any outstanding principle amount of this Note.


 


5.Transfers.


 


5.1General.
Holder acknowledges that this Note has not been registered under the Securities Act of 1933, as amended, or any state securities
laws, and agrees not to sell, pledge, distribute, offer for sale, transfer or otherwise dispose of this Note in the absence of
(i) an effective registration statement under the Securities Act as to this Note and registration or qualification of this Note
under any applicable state securities laws then in effect, or (ii) an opinion of counsel, satisfactory to the Company, that such
registration and qualification are not required.


 



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5.2Transferability.
Subject to the provisions of Section 5.1 hereof, this Note and all rights hereunder are transferable, in whole or in part,
upon surrender of the Note with a properly executed assignment, in the form prescribed by the Company, at the principal office
of the Company; provided, however, that this Note may not be transferred in whole or in part without the prior written consent
of the Company.


 


5.3Registered
Holder. Until any transfer of this Note is made in the Note register, the Company may treat the registered Holder of this Note
as the absolute owner hereof for all purposes; provided, however, that if and when this Note is properly assigned in blank,
the Company may (but shall not be required to) treat the bearer hereof as the absolute owner hereof for all purposes, notwithstanding
any notice to the contrary.


 


5.4Note
Register. The Company will maintain a register containing the name and address of the registered Holder of this Note. Any registered
Holder may change such registered Holder’s address as shown on the Note register by written notice to the Company requesting
such change.


 


5.5Transferee
Agreement. In the discretion of the Company, the Company may condition any transfer of all or any portion of this Note (other
than a disposition satisfying the conditions set forth in clause (i) of Section 5.1 above) upon the transferee’s delivery
to the Company of a written agreement, in form and substance satisfactory to the Company, whereby the transferee agrees to be bound
by the transfer restrictions set forth in this Section 5.


 


6.Events
of Default.


 


6.1Events
of Default. The occurrence of any or all of the following events shall constitute an event of default (each, an “Event
of Default”) by the Company under this Note:


 


(i)Default by the Company
in any payment on this Note after any such payment becomes due and payable; or


 


(ii)Breach by the Company
of any material provisions of any agreement between the Company and the Holder; or


 


(iii)The Company shall
file a voluntary petition in bankruptcy or any petition or answer seeking for itself any reorganization, readjustment, arrangement,
composition or similar relief; or shall commence a voluntary case under the federal bankruptcy laws; or shall admit in writing
its insolvency or its inability to pay its debts as they become due; or shall make an assignment for the benefit of creditors;
or shall apply for, consent to, or acquiesce in the appointment of, or the taking of possession by, a trustee, receiver, custodian
or similar official or agent of the Company or of substantially all of its property and shall not be discharged within sixty (60)
days; or a petition seeking reorganization, readjustment, arrangement, composition or other similar relief as to the Company under
the federal bankruptcy laws or any similar law for the relief of debtors shall be brought against the Company and shall be consented
to by it or shall remain un-dismissed for sixty (60) days.


 



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6.2Consequence
of Default. Upon the occurrence of any Event of Default, this Note shall immediately become due and payable upon written notice
from the Holder, and, from the time of the Company’s receipt of such written notice until this Note shall be paid in full,
the unpaid outstanding principal balance of this Note shall bear interest at the rate of fifteen percent (15%) per annum (calculated
on the basis of a three hundred sixty-five (365) day year for the actual number of days elapsed), compounded annually (the “Default
Rate”). Moreover, after the occurrence of any Event of Default, the Holder may proceed to protect and enforce its rights,
at law, in equity or otherwise, against the Company.


 


6.3Payment
of Costs and Expenses. In the event that this Note is placed in the hands of any attorney for collection, or any suit or proceeding
is brought for the recovery or protection of the indebtedness hereunder, then and in any such events, the Company shall pay on
demand all reasonable costs and expenses of such suit or proceedings incurred by Holder, including reasonable attorneys’
fees.


 


7.Miscellaneous.


 


7.1Delay.
No extension of time for payment of any amount owing hereunder shall affect the liability of the Company for payment of the indebtedness
evidenced hereby. No delay by the Holder or any holder hereof in exercising any power or right hereunder shall operate as a waiver
of any power or right hereunder.


 


7.2Waiver
and Amendment. No waiver or modification of the terms of this Note shall be valid without the written consent of the Holder.


 


7.3Governing
Law. This Note shall be governed by and construed in accordance with the laws of the State of California without regard to
conflict of law principles thereof.


 


7.4Severability.
In case any provision contained herein (or part thereof) shall for any reason be held to be invalid, illegal, or unenforceable
in any respect, such invalidity, illegality, or other unenforceability shall not affect any other provision (or the remaining part
of the affected provision) hereof, but this Note shall be construed as if such invalid, illegal, or unenforceable provision (or
part thereof) had never been contained herein, but only to the extent that such provision is invalid, illegal, or unenforceable.


 


7.5Notice.
All notices and other communications among the parties shall be in writing with a copy sent by electronic mail and shall be deemed
to have been duly given when (i) delivered in person, or (ii) five (5) days after posting in the U.S. mail as registered mail or
certified mail, return receipt requested, or (iii) one (1) business day when delivered by confirmed facsimile, addressed as follows:


 


If to the Company, to:Phototron
Holdings, Inc.


20259 Ventura Boulevard


Woodland Hills, CA 91364


Attention: CFO


Facsimile: (818) 992-0202


 


If to the Holder,
to:Woodman Management Corporation


12400 Ventura Boulevard, Suite 327


Studio City, CA 91604


Attention: Chief Executive Officer


Facsimile: (818) 474-7589


 



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7.6Entire
Agreement. This Note contains the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes
all prior agreements and understandings with respect thereto.


 


7.7Excessive Interest
Rate. This Note is hereby expressly limited so that the interest rate charged hereunder shall at no time exceed the maximum
rate permitted by applicable law. If, for any circumstance whatsoever, the interest rate charged exceeds the maximum rate permitted
by applicable law, the interest rate shall be reduced to the maximum rate permitted.


 


 


[Signature Page Follows]


 



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IN WITNESS WHEREOF, the
Company has caused this Revolving Promissory Note to be duly executed and delivered by its authorized officer as of the date first
above written.


 


 


PHOTOTRON HOLDINS, INC.


 


 


 


By:/s/ BRIAN SAGHEB


Brian B. Sagheb,
CFO


 


 


 


ACKNOWLEDGED:


 


 


W-NET FUND I, L.P.


 


By: W-Net Fund GP I, LLC


Its: General Partner


 


 


By:/s/ DAVID WEINER


David Weiner, Manager