Document:

fp0002528_ex10-1.htm

 

THE SECURITIES SUBSCRIBED FOR UNDER THIS SUBSCRIPTION AGREEMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAW, AND THE TRANSFER OF SUCH SECURITIES BY SUBSCRIBER IS RESTRICTED BY THE SECURITIES ACT, APPLICABLE STATE SECURITIES LAWS, AND AS OTHERWISE SET FORTH IN THIS SUBSCRIPTION AGREEMENT.

 

SUBSCRIPTION AGREEMENT

 

Workstream Inc.

485 N. Keller Rd.

Suite 500

Maitland, Florida 32751

Ladies and Gentlemen:

 

1.   Subscription.  The undersigned subscriber ("Subscriber") hereby irrevocably subscribes for and agrees to purchase  shares (the "Shares") of Common Stock, no par value per share, of Workstream Inc. (the "Company") at a purchase price of US$.016 per share.  It is understood that this subscription is not binding on the Company until the Company, in its sole discretion, accepts the subscription by executing the acceptance page of this Subscription Agreement.  Subscriber hereby acknowledges and agrees that this subscription is irrevocable and that, except as required by law, Subscriber is not entitled to cancel, terminate or revoke this Subscription Agreement or any agreements of the undersigned hereunder.

 

2.   Payment.  At the time of delivery to the Company of these completed subscription materials (including an executed copy of this Subscription Agreement and a completed and executed copy of the Investor Questionnaire attached as Exhibit A to this Subscription Agreement), Subscriber shall deliver to the Company, by check or wire transfer in accordance with the instructions provided by the Company to Subscriber, the consideration to be paid for the Shares in an amount equal to US$_______.

 

3.   Certificates.  Upon acceptance of Subscriber’s subscription, the Company will issue one or more certificates evidencing the Shares.

 

4.   Representations, Warranties and Covenants of Subscriber. Subscriber hereby represents, warrants and covenants to the Company as follows:

 

(a)   Subscriber has carefully reviewed the Company's periodic, current and other reports filed with the Securities and Exchange Commission (the "Company Filings"), including but not limited to the Company’s Annual Report on Form 10-K for the year ended May 31, 2010 (the "Form 10-K") and the Quarterly Report on Form 10-Q for the quarter ended August 31, 2010, as well as the financial statements contained in such Company Filings, and has relied solely upon the Company Filings and investigations made by or on behalf of Subscriber in making the decision to purchase the Shares.  No person or entity has made any representations or warranties, or furnished any sales or offering literature, to Subscriber other than the Company Filings.

 

  

  

  

 

(b)   Subscriber has been granted the opportunity to ask questions of, and has received answers satisfactory to Subscriber from, representatives of the Company concerning the Shares, the Company and its operations.  Subscriber has been given the opportunity to obtain, and has obtained, all additional information which Subscriber deems necessary to verify the accuracy of the information contained in the Company Filings and to evaluate the merits and risks of an investment in the Shares.

 

(c)   No undertakings, understandings, inducements, covenants, representations or warranties have been made to Subscriber by the Company, its affiliates or any agent or employee of the Company with respect to Subscriber’s investment in the Company or otherwise in connection with the Company or this offering.

 

(d)   Subscriber is acquiring the Shares for investment purposes only, for Subscriber’s own account and not with a view to resale, assignment or distribution thereof, either in whole or in part.

 

(e)   Subscriber understands that no federal or state agency or regulatory body, including without limitation, any federal or state securities commission, has approved or disapproved the Shares or passed upon or endorsed the merits of this offering or this Subscription Agreement.

 

(f)   Subscriber understands that (i) the Company has not registered the Shares under the Securities Act or any applicable state securities laws, (ii) the Shares are being offered in this offering pursuant to exemptions from the registration requirements of the Securities Act and such state securities laws, (iii) the Shares may not be sold, pledged, assigned or otherwise disposed of by Subscriber in the absence of an effective registration statement for the Shares under the Securities Act or unless an exemption from such registration is available, and (iv) the Company is under no obligation and has no intention to apply for the registration of the Shares or comply with any exemption from registration so as to permit any resale, and it has not represented that at some future date an attempt will be made to register the Shares or to comply with an exemption from registration so as to permit resale.

 

(g)   Subscriber will not attempt to sell, transfer, assign, pledge or otherwise dispose of all or any portion of the Shares in the absence of either an effective registration statement or an opinion of a reputable securities counsel which is satisfactory in form and substance to the Company and its counsel that such proposed sale, transfer, assignment, pledge or other disposition would not be in violation of the Securities Act or any other applicable securities law.

 

(h)   Subscriber has consulted with Subscriber’s own legal, accounting, tax, investment and other advisers with respect to the tax treatment of an investment by Subscriber in the Shares and the merits and risks of an investment in the Shares.

 

  

2

  

 

(i)   Subscriber has the requisite knowledge and experience in financial and business matters to be capable of evaluating the merits and risks of an investment in the Company, and has determined that such an investment is a suitable investment.

 

(j)   Subscriber understands that Subscriber may be precluded from selling or otherwise transferring or disposing of the Shares for an indefinite period of time or at any particular time, and may therefore have to bear the economic risk of investment in the Shares for an indefinite period of time.

 

(k)   Subscriber recognizes that investment in the Shares involves a high degree of risk and understands that any and all of the risk factors relating to the ownership of the Shares, including those risk factors set forth in the Form 10-K, could individually or in the aggregate have a material adverse effect on the Company and the value of the Shares.

 

(l)   With respect to each Subscriber that is an individual, such Subscriber represents that he or she has adequate means for providing for his or her current needs and possible personal contingencies and has no need for liquidity of the Shares, and can afford a complete loss of the investment in the Shares.  Subscriber’s commitment to illiquid investments is reasonable in relation to Subscriber’s net worth.

 

(m)   Subscriber is an "Accredited Investor" as such term is defined in Rule 501 of Regulation D of the Securities Act, as evidenced in the questionnaire attached as Schedule A to this Subscription Agreement (the "Investor Questionnaire").

 

(n)   The information provided to the Company in the Investor Questionnaire, and any other information provided to the Company by Subscriber, is true, complete and correct in all material respects.

 

(o)   Subscriber understands that the Shares are being offered and sold in reliance upon specific exemptions from the registration requirements of federal and state securities laws and that the Company is relying upon the truth and accuracy of the representations, warranties, agreements, acknowledgements and understandings set forth herein and in the Investor Questionnaire in order to determine the applicability of  such exemptions and the suitability of the undersigned to acquire the Shares.

 

(p)   Subscriber will supply the Company with such other facts as from time to time are deemed necessary or desirable in order to ascertain that no violation has occurred of any securities laws of the United States or any other relevant jurisdiction, including the Securities Act.

 

(q)   Subscriber has the full right, power and authority to enter into this Subscription Agreement and the other documents contemplated hereby.  If other than an individual or individuals, Subscriber has taken all actions necessary to authorize fully the execution, delivery and performance of this Subscription Agreement and the other documents contemplated hereby.

 

  

3

  

 

(r)   Subscriber will inform the Company immediately by telephone and in writing of any change in the information set forth herein occurring on or before the acceptance of any subscription hereunder.

 

5.   Legend.  Subscriber understands and agrees that the certificate(s) representing or relating to the Shares subscribed for hereunder shall bear such legends as the Company, in its sole discretion, deems necessary or advisable in order to facilitate compliance with the Securities Act and any applicable state securities laws, including without limitation, a legend in substantially the form set forth below:

 

"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE.  THE SECURITIES MAY NOT BE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER THE SECURITIES ACT AND SUCH STATE SECURITIES LAWS."

 

6.   Indemnification.  Subscriber recognizes that the sale of the Shares to Subscriber is based upon Subscriber’s representations and warranties as set forth herein and on the information provided by Subscriber in the Investor Questionnaire.  Subscriber hereby agrees to indemnify and hold harmless the Company, and its directors, officers, employees, stockholders, agents, representatives, successors and assigns from and against all liability, damage, costs or expenses (including reasonable attorneys’ fees) which:  (a) arise out of or are due to a breach of the representations and warranties made by Subscriber or an inaccuracy, incompleteness or other defect in the information provided herein or in the Investor Questionnaire; or (b) arise after such Subscriber has become a stockholder of the Company, as a result of the sale or distribution of all or any portion of the Shares subscribed for hereby, or any interest therein, or Subscriber’s violation of any federal and state securities laws or any other applicable laws.  All such representations and warranties shall survive the consummation of the transactions contemplated hereby.

 

7.   Acceptance by the Company; Binding Agreement.  Subscriber understands that this subscription may be accepted or rejected, in whole or in part, by the Company, in its sole discretion, and that no subscription for the Shares will be binding until accepted by the Company.  In the event this subscription is rejected in whole, the instruments and documents delivered herewith and the consideration tendered for the Shares, will be returned to Subscriber, and all of the obligations of Subscriber hereunder shall terminate.  In the event the subscription is rejected in part, the consideration tendered in respect to the portion not accepted will be returned to Subscriber.  Upon acceptance by the Company, this Subscription Agreement, and all of the obligations of Subscriber hereunder and all of the representations and warranties by Subscriber herein, shall be binding upon the heirs, executors, administrators, personal representatives, successors and assigns of Subscriber; provided, however, that this Subscription Agreement is transferable or assignable by Subscriber only with the Company’s prior express written consent, which may be withheld for any reason.

 

  

4

  

 

8.   Miscellaneous Provisions.

 

(a)   This Subscription Agreement shall be construed in accordance with and governed in all respects by the laws of the State of Florida, without regard to any conflict of law provisions.

 

(b)   This Subscription Agreements and the representations, acknowledgements, warranties and agreements set forth herein shall be binding upon and shall inure to the benefit of Subscriber, and Subscriber’s successors, assigns, heirs and legal representatives.  This Subscription Agreement shall be binding upon and shall inure to the benefit of the Company and its successors and assigns.

 

(c)   This Subscription Agreement may not be modified except by a writing signed by Subscriber and the Company.

 

(d)   This Subscription Agreement may be executed in counterparts, each of which shall be and constitute an original and which together shall constitute a single agreement.

 

(e)   If any provision of this Subscription Agreement shall be invalid or unenforceable within any jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remainder of this Subscription Agreement or the validity or enforceability of this Subscription Agreement in any other jurisdiction.

 

(f)   This Subscription Agreement, including all exhibits or schedules hereto, contains the entire agreement of the parties with respect to the subject matter hereof, and there are no representations, warranties, covenants or other agreements except as stated or referred to herein.

 

IN WITNESS WHEREOF, the undersigned has executed this Subscription Agreement as of the day and year indicated on the Signature Page.

 

[SIGNATURE PAGES FOLLOW]

 

  

5

  

 

SIGNATURE PAGE FOR INDIVIDUAL

 

	  	
Number of Shares subscribed for:

	
____________

	  	  	  
	  	
Cost of Shares subscribed for ($.016 per Share)

	
$___________

 

SUBSCRIBER:

 

	
___________________________________

	
______________________

	
___________

	
Signature

	
Social Security No.

	
Date

	 	 	 
	
___________________________________

	
Print Name

 

	
___________________________________

	
___________________________________

	  	  
	 	 
	
___________________________________

	
___________________________________

	  	  
	 	 
	
___________________________________

	
___________________________________

	
Residence Address

	
Mailing Address (if different)

	 	 
	
___________________________________

	
___________________________________

	
Home Phone

	
Home Facsimile

	 	 
	
___________________________________

	
___________________________________

	
Office Phone

	
Office Facsimile

 

  

6

  

 

SIGNATURE PAGE FOR ENTITIES

 

Please submit additional copies of this Signature Page, if additional signatures are required for proper authorization.

	  	
Number of Shares subscribed for:

	
____________

	  	  	  
	  	
Cost of Shares subscribed for ($.016 per Share)

	
$___________

 

Form of Organization:  ___ Corporation   ___ Limited Partnership    ___ Limited Liability Company

 

 ___ Other Entity (describe)                                                                                                         

 

Full Name of Subscriber:                                                                                                                               

 

	
Tax I.D. No. _____________________

	
Date:                                                         

	  

 

	
Address:

	
___________________________________

	 	 
	  	
___________________________________

	 	 
	  	
___________________________________

	 	 
	
Phone:

	
___________________________________

	 	 
	
Facsimile:

	
___________________________________

	 	 
	 	 
	
Name:

	
___________________________________

	  	
(Entity Name)

	 	 
	
By:

	
___________________________________

	  	
Signature

 

_____________________________________________

Print Name

Title:

 

  

7

  

 

ACCEPTANCE BY WORKSTREAM INC.

 

 

Workstream Inc. hereby accepts the foregoing subscription for _________ Shares and agrees that Subscriber shall acquire the Shares and become a stockholder of the Company effective as of the date set forth below.

	 	

WORKSTREAM INC.

	 	 
	 	 
	  	
By: ______________________________________

	  	
      Name:

	  	
      Title:

 

 

Effective Date:  December ____, 2010

 

  

8

  

 

EXHIBIT A

 

ACCREDITED INVESTOR QUESTIONNAIRE

 

Subscriber should initial all of the following statements that are true.  Subscriber hereby represents and warrants that Subscriber’s responses to this questionnaire are true and correct.

 

	  	  	
INITIALS

	  	
(i) Subscriber certifies that Subscriber has a net worth (jointly with Subscriber’s spouse, if any) in excess of $1,000,000.

	
_______

	  	
(ii) Subscriber certifies that Subscriber had individual income for each of the years 2008 and 2009 in excess of $200,000 and has a reasonable expectation of reaching the same income level in 2010.

	
_______

	  	
(iii) Subscriber certifies that he or she and his or her spouse had a joint income for each of the years 2008 and 2009 in excess of $300,000 and has a reasonable expectation of reaching the same income level in 2010.

	
_______

	  	
(iv) If Subscriber is an entity, it certifies that all of the equity owners satisfy the standards set forth in (i), (ii) or (iii) above or that it has assets in excess of $5,000,000 and was not formed for the specific purpose of acquiring the Shares.

	
_______

	  	
(v) If Subscriber is a trust, it certifies that it has total assets in excess of $5,000,000, that its investment in the Shares is being directed by a person having such knowledge and experience in financial and business matters as to evaluate the merits and risks of such an investment, and that it was not formed for the specific purpose of acquiring the Shares.

	
_______

	  	
(vi) If Subscriber is an employee benefit plan within the meaning of Title I of the Employee Retirement Income Security Act of 1974, it certifies that it has total assets in excess of $5,000,000 or that the decision to invest in the Shares is being made by a plan fiduciary which is a bank, savings and loan association, insurance company or registered investment adviser.

	
_______

	  	
(vii) None of the standards set forth in (i), (ii), (iii) or

	
_______

	  	
(iv) above apply.

	
_______

[Signature page to Investor Questionnaire follows—PLEASE SIGN BELOW]

  

1

  

State of Primary Residence/Formation /Incorporation:                                                                                                     

 

	____________________________________	____________________________________  
	
Signature of Subscriber (if an Individual)

	
Name of Subscriber (if an Entity)

	  	  
	
Printed: ______________________________

	
By:                                                     

	  	
Name:

	
Dated: _______________________________

	
Title:

 

 

2ex10-1.htm

Exhibit 10.1

 

THIS NOTE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED, OR HYPOTHECATED WITHOUT EITHER:  i) REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS, OR ii) COMPLIANCE WITH APPLICABLE EXEMPTIONS FROM THE  REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933 AND APPLICABLE STATE SECURITIES LAWS.

PROMISSORY NOTE

 

	
$3,950,000.00

	
Effective February 1, 2011 

	  	  

 

FOR VALUE RECEIVED, MedicalWork, LLC, a Georgia limited liability company, and Generation Zero Group, Inc.., a Nevada Corporation (together, the “Company”), hereby jointly and severally promises to pay to the order of JEFFREY E. SISK, an individual resident of the state of Florida, and/or his assigns (the “Holder”), at the address of Holder at 199 Daisy Street Homosassa, FL 34446 or such other place as may be designated by Holder to the Company in writing, the aggregate principal amount of $3,950,000.00, together with interest on the unpaid principal amount hereof, upon the terms and conditions hereinafter set forth.

	
1.

	
Loan Amount.  This Promissory Note (this “Note”, “Promissory Note” or “Agreement”) evidences the principal amount of $3,950,000.00 (hereinafter referred to as the “Loan” or the “Principal”).

	  	  	  
	
2.

	
Interest.  Interest on the outstanding portion of Principal of this Note shall accrue at a rate of eight percent (8%) per annum.  Interest begins to accrue under this Note on the date hereof.  All past-due principal and interest (which failure to pay such amounts shall constitute an "Event of Default" as further defined in Section 6 below) shall bear interest at the rate of fourteen percent (14%) per annum until paid in full.  All computations of interest shall be made on the basis of a 360-day year for actual days elapsed.  Such interest shall accrue and be paid as described in Section 3 of this Note.

	  	  	  
	
3.

	
Payment Terms.  Principal and interest are due as follows: (i) 100% of the net cash flow generated from the URLs www.physicianwork.com, www.doctorwork.com and www.locumtenenswork.com (the “Main URL’s”) after payment of required payments under Jeffrey Sisk’s employment agreement shall be applied monthly on a cash basis first to accrued interest and the balance if any to Principal until this Note is paid in full; (ii) 50% of all net cash flow generated by MedicalWork, LLC (excluding the Main URL’s)  shall be applied monthly on a cash basis first to accrued interest and the balance if any to Principal until this Note is paid in full, with the balance retained by the Company; and (iii) payment in full of Principal and interest under this Note is due on the twelve (12) month anniversary of the date of this Note unless earlier paid in full under the provisions of subsections  (i) and (ii); provided, that  Holder will grant Company a six (6) month extension of time for payment in full, upon written request of the Company, if the remaining Principal and interest due under this Note on the twelve (12) month anniversary of the date of this Note is at or below Two Million Dollars ($2,000,000.00) and there has not occurred an Event of Default as defined in Section 6 below.  All payments hereunder shall be made in lawful money of the United States of America.  Payments shall be credited first to the accrued interest then due and payable and the remainder to Principal.

  

  

  

	  	
a.

	
Notwithstanding any provision in this Note, the total liability for payments of interest and payments in the nature of interest, including all charges, fees, exactions, or other sums which may at any time be deemed to be interest, shall not exceed the limit imposed by the usury laws of the State of Georgia or the applicable laws of the United States of America, whichever shall be higher (the “Maximum Rate”).

	  	
b.

	
In the event the total liability for payments of interest and payments in the nature of interest, including, without limitation, all charges, fees, exactions or other sums which may at any time be deemed to be interest, which for any month or other interest payment period exceeds the Maximum Rate, all sums in excess of those lawfully collectible as interest for the period in question (and without further agreement or notice by, among or to the Holder the undersigned) shall be applied to the reduction of the principal balance, with the same force and effect as though the undersigned had specifically designated such excess sums to be so applied to the reduction of the principal balance and the Holder had agreed to accept such sums as a premium-free prepayment of principal; provided, however, that the Holder may, at any time and from time to time, elect, by notice in writing to the undersigned, to waive, reduce or limit the collection of any sums in excess of those lawfully collectible as interest rather than accept such sums as a prepayment of the principal balance.  The undersigned does not intend or expect to pay nor does the Holder intend or expect to charge, accept or collect any interest under this Note greater than the Maximum Rate.

  

	  	
c.

	
If any payment of principal or interest on this Note shall become due on a Saturday, Sunday or any other day on which national banks are not open for business, such payment shall be made on the next succeeding Business Day. "Business Day" means a day other than (i) a Saturday, (ii) a Sunday or (iii) a day on which commercial banks in Atlanta, Georgia, are authorized or required to be closed for business.

 

	
 4.

	
Prepayment.   

 

	  	
a.

	
This Note may be prepaid in whole or in part at any time without penalty.

	  	  	  
	  	
b.

	
Any partial prepayment shall be applied first to any accrued interest and then to any principal Loan amount outstanding.

 

	
5.

	
Representations and Warranties of the Company. The Company represents and warrants to Holder as follows: 

 

	  	
a.

	
The execution and delivery by the Company of this Note (i) are within the Company’s corporate power and authority, and (ii) have been duly authorized by all necessary corporate action.  Further, the undersigned is a duly authorized representative of the Company and has been authorized by a resolution of the Board of Directors of the Company to exercise any and all documents necessary to effectuate the transaction contemplated hereby.

  

  

  

	  	
b.

	
This Note is a legally binding obligation of the Company, enforceable against the Company in accordance with the terms hereof, except to the extent that (i) such enforceability is limited by bankruptcy, insolvency, reorganization, moratorium or other laws relating to or affecting generally the enforcement of creditors’ rights, and (ii) the availability of the remedy of specific performance or in injunctive or other equitable relief is subject to the discretion of the court before which any proceeding therefore may be brought.

	
6.

	
Events of Default.  The then-outstanding principal balance of this Note, together with any interest accrued thereon shall become immediately due and payable if any of the following events ("Events of Default"), and/or any other default or Events of Default defined elsewhere in this Note. Events of Default include:

 

	  	
a.

	the Company shall fail to pay when and as due, the Principal or interest payable under this Note on the due date of such payment; or
	  	  	  
	  	
b.

	there is a default, by the Company or any other grantor, under the Pledge Agreement (as defined in Section 7 below) or any other security agreement securing the payment of this Note; or
	 	 	 
	 	c.	there is a default, by the Company or any other grantor, under the Senior Note (as defined in Section 8 below) or any security agreement securing the payment of the Senior Note; or
	 	 	 
	 	d.	the Company shall: (i) become insolvent or take any action which constitutes its admission of inability to pay its debts as they mature; (ii) make an assignment for the benefit of creditors, file a petition in bankruptcy, petition or apply to any tribunal for the appointment of a custodian, receiver or a trustee for it or a substantial portion of its assets; (iii) commence any proceeding under any bankruptcy, reorganization, arrangement, readjustment of debt, dissolution or liquidation or statute of any jurisdiction, whether now or hereafter in effect; (iv) have filed against it any such petition or application in which an order for relief is entered or which remains undismissed for a period of ninety (90) days or more; (v) indicate its consent to, approval of or acquiescence in any such petition, application, proceeding or order for relief or the appointment of a custodian, receiver or trustee for it or a substantial portion of its assets; or (vi) suffer any such custodianship, receivership or trusteeship to continue undischarged for a period of ninety (90) days or more; or

 

 

  

  

  

	 	 	 
	 	e.	the Company shall take any action authorizing, or in furtherance of, any of the foregoing; or
	 	 	 
	 	f.	the Company shall remove or effectively remove Jeffrey Sisk from management control of MedicalWork, LLC prior to the Note being fully paid or in violation of any provision of Jeffrey Sisk’s employment agreement with the Company.

 

In case any one or more Events of Default shall occur and be continuing (and not fully cured within 30 days of the occurrence), Holder may proceed to protect and enforce its rights by an action at law, suit in equity or other appropriate proceeding, whether for the specific performance of any agreement contained herein or for an injunction against a violation of any of the terms hereof, or in aid of the exercise of any power granted hereby or thereby or by law or otherwise.  In case of a default in the payment of any principal of or premium, if any, or interest on this Note, the Company will pay to Holder such further amount as shall be sufficient to cover the reasonable cost and expenses of collection, including, without limitation, reasonable attorneys’ fees, expenses and disbursements.  No course of dealing and no delay on the part of Holder in exercising any right, power or remedy shall operate as a waiver thereof or otherwise prejudice Holder’s rights, powers or remedies.  No right, power or remedy conferred by this Note upon Holder shall be exclusive of any other right, power or remedy referred to herein or therein or now or hereafter available at law, in equity, by statute or otherwise.

 

The Company will give Holder notice of the occurrence of an Event of Default promptly (setting forth in reasonable detail all facts related thereto) after the Company has knowledge of the occurrence of any such event.

 

	
7.

	
Security Agreement.  This Note is secured by a pledge of, and security interest in, all of the membership interest in MedicalWork, LLC, pursuant to that certain Pledge Agreement of even date herewith by and among the Generation Zero Group, Inc. and Holder (the “Pledge Agreement”).  If an Event of Default is not cured within 30 days, this Note shall accelerate and the Holder may undertake any and all remedies provided under this Note, the Pledge Agreement, or applicable law.

	
8.

	
Provisions Regarding Senior Debt. The parties acknowledge that security interest granted in connection with this Note is subject and subordinated to the security interest granted by Company in connection with that certain $250,000.00 promissory note from the Company to Geronimo Property Trust, a Nevada trust (the “Senior Lender”) issued on or about the date hereof (the “Senior Note”).  The Company shall provide written documentation to Holder evidencing each payment made to Senior Lender under the Senior Note, within five (5) business days of the date such payment is made, and shall provide notice of any default under the Senior Note immediately upon the occurrence of such default.

	  	  
	
9.

	
Certain Waivers by the Company.  Except as expressly provided otherwise in this Note, the Company waives presentment, demand, notice, protest and all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Note, and assent to any extension or postponement of the time of payment or any other indulgence, to any substitution, exchange or release of collateral available to Holder, if any, and to the addition or release of any other party or person primarily or secondarily liable.

  

  

  

	
10.

	
Assignment by Holder.  If and whenever this Note shall be assigned and transferred, or negotiated, including transfers to substitute or successor trustees, the holder hereof shall be deemed the “Holder” for all purposes under this Note.

	  	  
	
11.

	
Amendment.  This Note may not be changed orally, but only by an agreement in writing, signed by the party against whom enforcement of any waiver, change, modification or discharge is sought.

 

	
12.

	
Costs and Fees.  Anything else in this Note to the contrary notwithstanding, in any action arising out of this Agreement, the prevailing party shall be entitled to collect from the non-prevailing party all of its attorneys’ fees.  For the purposes of this Note, the party who receives or is awarded a substantial portion of the damages or claims sought in any proceeding shall be deemed the “prevailing” party and attorneys’ fees shall mean the reasonable fees charged by an attorney or a law firm for legal services and the services of any legal assistants, and costs of litigation, including, but not limited to, fees and costs at trial and appellate levels.

	  	  
	
13.

	
Governing Law.  It is the intention of the parties hereto that the terms and provisions of this Note are to be construed in accordance with and governed by the laws of the State of Georgia, except as such laws may be preempted by any federal law controlling the rate of interest which may be charged on account of this Note.

  

	
14.

	
No Third Party Benefit.  The provisions and covenants set forth in this Agreement are made solely for the benefit of the parties to this Agreement and are not for the benefit of any other person, and no other person shall have any right to enforce these provisions and covenants against any party to this Agreement.

	  	  
	
15.

	
Jurisdiction and Venue.  The parties hereby consent and agree that, in any actions predicated upon this Note, venue is properly laid in Georgia and that the Circuit Court in and for Atlanta, Georgia, shall have full subject matter and personal jurisdiction over the parties to determine all issues arising out of or in connection with the execution and enforcement of this Note.

	  	  
	
16.

	
Interpretation.  The term “Company” as used herein in every instance shall include the Company’s successors, legal representatives and assigns, including all subsequent grantees, either voluntarily by act of the Company or involuntarily by operation of law and shall denote the singular and/or plural and the masculine and/or feminine and natural and/or artificial persons, whenever and wherever the contexts so requires or properly applies.  The term “Holder” as used herein in every instance shall include the Holder’s successors, legal representatives and assigns, as well as all subsequent assignees, endorsees and holders of this Note, either voluntarily by act of the parties or involuntarily by operation of law.  Captions and paragraph headings in this Note are for convenience only and shall not affect its interpretation.

 

  

  

  

	  	  
	
17.

	
Entire Agreement.  This Agreement constitutes the sole and only agreement of the parties hereto and supersedes any prior understanding or written or oral agreements between the parties respecting the subject matter hereof. 

	  	  
	
18.

	
WAIVER OF JURY TRIAL.  THE COMPANY AND HOLDER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT EITHER MAY HAVE TO TRIAL BY JURY IN RESPECT TO ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE AND ANY AGREEMENT CONTEMPLATED TO BE EXECUTED IN CONJUNCTION HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS, (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF EITHER PARTY.  THE COMPANY ACKNOWLEDGES THAT THIS WAIVER OF JURY TRIAL IS A MATERIAL INDUCEMENT TO THE HOLDER IN EXTENDING CREDIT TO THE COMPANY, THAT THE HOLDER WOULD NOT HAVE EXTENDED SUCH CREDIT WITHOUT THIS JURY TRIAL WAIVER, AND THAT THE COMPANY HAS BEEN REPRESENTED BY AN ATTORNEY OR HAS HAD AN OPPORTUNITY TO CONSULT WITH AN ATTORNEY IN CONNECTION WITH THIS JURY TRIAL WAIVER AND UNDERSTANDS THE LEGAL EFFECT OF THIS WAIVER.

	
19.

	
Entire Agreement.  This Agreement constitutes the sole and only agreement of the parties hereto and supersedes any prior understanding or written or oral agreements between the parties respecting the subject matter hereof.

	
20.

	
Effect of Facsimile and Photocopied Signatures. This Agreement may be executed in several counterparts, each of which is an original.  It shall not be necessary in making proof of this Agreement or any counterpart hereof to produce or account for any of the other counterparts.  A copy of this Agreement signed by one Party and faxed or scanned and emailed to another Party (as a PDF or similar image file) shall be deemed to have been executed and delivered by the signing Party as though an original.  A photocopy or PDF of this Agreement shall be effective as an original for all purposes.

 

[Signatures begin next page]

 

 

 

 

 

 

  

  

  

IN WITNESS WHEREOF, the undersigned have caused this Promissory Note to be executed and delivered by a duly authorized officer as of the date first above written, to be effective as of the effective date set forth above.

 

	  	
Generation Zero Group, INC.

a Nevada Corporation

	  
	  	
 

 

By: /s/ Matthew D. Krieg

       Matthew D. Krieg, CEO

 

 

 

	  

 

	  	
MedicalWork, LLC

	  	
a Georgia limited liability company

	  	  
	  	
By: Generation Zero Group, Inc.,

	  	
Its sole member

	  	  
	  	  
	  	
By: /s/ Matthew D. Krieg

	
 

	
     Matthew D. Krieg, CEO

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