Document:

fs11101_x106-audio.htm

Exhibit 10.6

 

MTTF TERMINATION AND RELEASE AGREEMENT

This MTTF Termination and Release Agreement (this "Termination Agreement") is entered into on this ____ day of October, 2011 by and between Audioeye, Inc., a Delaware corporation (the "Company") and the Maryland Technology Development Corporation, a body politic and corporate and a public instrumentality of the State of Maryland ("TEDCO.")

Whereas, TEDCO has invested $74,900.00 in the Company pursuant to the MTTF Investment Agreement dated December 22, 2006 (the "Investment Agreement"); and

Whereas, in connection with the agreement by the parties to instead document the repayment due under the Investment Agreement to a promissory note of even date herewith (the “Note”), the parties desire to terminate the Investment Agreement; and

Whereas, the parties further desire to enter into mutual releases and certain other agreements, as set forth herein.

Now, therefore, for and in consideration of TEDCO's agreement to terminate the Investment Agreement, and the Company's agreement to execute the Note, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

1.           Termination of the Investment Agreement.

Subject to the conditions listed in paragraph 3 below, the parties hereby terminate the Investment Agreement effective immediately and agree that the Investment Agreement shall be of no force or effect.

2.           Mutual Release.

Subject to the conditions listed in paragraph 3 below, the Company hereby releases, discharges, and acquits TEDCO, its officers, directors, employees, agents, predecessors, successors, and assigns, and TEDCO hereby releases, discharges, and acquits the Company, its officers, directors, employees, agents, predecessors, successors, and assigns (collectively, the "Release Parties") from any and all obligations, claims, debts, demands, liens, rights, and causes of action of any kind or nature, including without limitation liability for amounts owed, whether known or unknown as of the date hereof, that TEDCO or the Company may now or hereafter have or assert against the other and/or any of the Released Parties, pursuant to or in connection with the Investment Agreement.

  

  

  

 

3.           Conditions.

The parties hereby agree that this Termination Agreement is contingent upon the following conditions:

a.           The Company shall execute the Note contemporaneously with its execution hereof.

b.           The representations and warranties contained in any certificate, financial statement or document delivered to TEDCO in connection with this transaction shall be true and correct when made and shall be true and correct as of the date of the closing of this transaction (the "Closing Date") with the same force and effect as if they had been made on and as of the Closing Date.

4.           General Provisions.

a.           This Termination Agreement shall be governed by the laws of the State of Maryland.  This Termination Agreement represents the entire agreement between the parties with respect to the termination of the Investment Agreement and may only be modified or amended in writing signed by both parties.

b.           Either party's failure to enforce any provision or provisions of this Termination Agreement shall not in any way be construed as a waiver of any such provision or provisions, nor prevent that party thereafter from enforcing each and every other provision of this Termination Agreement.  The rights granted both parties herein are cumulative and shall not constitute a waiver of either party's right to assert all other legal remedies available to it under the circumstances.

c.           The provisions of this Termination Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties.

d.           If one or more provisions of this Termination Agreement are held to be unenforceable under applicable law, such provision shall be excluded from this Termination Agreement and the balance of the Termination Agreement shall be interpreted as if such provisions were so excluded and shall be enforceable in accordance with its terms.

e.           This Termination Agreement may be executed in any number of counterparts, all of which together shall constitute one Termination Agreement, and any of which, if delivered by facsimile transmission, shall have the same force and effect as if such facsimile signature were an original.

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Signature Page Follows

  

  

  

IN WITNESS WHEREOF, the parties have duly executed this MTTF Termination and Release Agreement as of the day and year first set forth above.

Audioeye, Inc.

By:           ________________________________

Name:           ________________________________

Title:           ________________________________

Maryland Technology Development Corporation

By:           ________________________________

Robert A. Rosenbaum

President & Executive Director

Approved for Form & Legal Sufficiency:

______________________________________

Ira Schwartz, Esq., TEDCO Counselfs11101_x107-audio.htm

Exhibit 10.7

 

PROMISSORY NOTE

 

	 $149,800.00	 	 	 October ___, 2011

FOR VALUE RECEIVED, Audioeye, Inc., a Delaware corporation, (the “Borrower”) promises to pay to the order of the Maryland Technology Development Corporation, a body politic and corporate and a public instrumentality of the State of Maryland (“TEDCO”), the principal sum of One Hundred Forty-Nine Thousand Eight Hundred and 00/100 Dollars ($149,800.00) (the “Loan”) without interest but with any other sums that may be owed to TEDCO by the Borrower pursuant to this Promissory Note (the “Note”). The following terms shall apply to this Note.

	
  

	
1.

	
Repayment.

 (a)           Beginning on the first day of November, 2011, and continuing on the same day of each succeeding month thereafter until either the date upon which the Borrower raises an aggregate amount of new capital totaling $2,500,000.00 or until the principal balance due hereunder and any other amounts outstanding hereunder are paid in full, whichever shall first occur (the “Maturity Date”), the Borrower shall repay the Loan in equal consecutive monthly installments of Two Thousand and 00/100 Dollars ($2,000.00).

(b)           The Borrower shall pay any remaining principal balance, with any other amounts outstanding hereunder, on the Maturity Date.

2.           Late Payment Charge.  If any payment due hereunder is not received by TEDCO within 15 calendar days after its due date, TEDCO may require the Borrower to pay a late payment charge equal to five percent of the amount then due.

3.           Application of Payments.  TEDCO shall apply all payments made under this Note first to principal, and then to late charges, fees, or other sums owed to TEDCO, or in any other order that TEDCO determines in its sole discretion.

4.           Prepayment.  The Borrower may prepay this Note in whole or in part at any time without premium or penalty.  TEDCO shall apply any voluntary prepayment first to late charges and fees, and then to principal, or in any other order that TEDCO determines in its sole discretion.

5.           Place of Payment.  All payments due under this Note, and any prepayments, shall be made during regular business hours to: Maryland Technology Development Corporation, 5565 Sterrett Place- Suite 214, Columbia, Maryland 21044, or to any other place that TEDCO may designate in writing, and shall be made in immediately available funds in a manner acceptable to TEDCO.

6.           Default.  The failure of the Borrower to pay TEDCO when due any and all amounts payable under the terms of this Note shall constitute a default (a “Default”) under the terms of this Note.

7.           Acceleration.  Upon a Default, TEDCO, in its sole discretion and without further notice or demand, may declare the entire unpaid principal balance of this Note plus all other sums due under this Note to be immediately due and payable and may exercise all rights and remedies available to it.

  

  

  

 

8.           Confession of Judgment.  Upon a Default, the Borrower authorizes the clerk or any attorney of any court of record to appear for it and enter judgment by confession, without prior notice or opportunity for prior hearing, for the principal balance then outstanding under this Note, together with court costs and attorneys’ fees not to exceed 15% of the sum of the amount then outstanding.  The Borrower waives and releases, to the extent permitted by law, all errors and all rights of exemption, appeal, stay of execution, inquisition, and extension upon any levy on real estate or personal property to which the Borrower may otherwise be entitled under any law.  The authority to appear for and enter judgment against the Borrower may be exercised on one or more occasions, and shall not be extinguished by any judgment entered pursuant thereto.  This authority may be exercised in the same or different jurisdictions, as often as TEDCO determines to be necessary or desirable.

9.           Consent to Jurisdiction.  The Borrower irrevocably submits to the jurisdiction of any state or federal court sitting in the State of Maryland over any proceeding arising out of or relating to this Note.  The Borrower irrevocably waives, to the fullest extent permitted by law, any objection that the Borrower may now or hereafter have to the setting of venue of any proceeding brought in any such court and any claim that any proceeding brought in any such court was brought in an inconvenient forum.

10.           Service of Process.  The Borrower hereby consents to process being served in any proceeding instituted in connection with this Note by the mailing of a copy by certified mail, postage prepaid, return receipt requested, to the Borrower at the following address: 9070 S. Rita Road, Suite 1450, Tucson, Arizona 85747.  Nothing in this Note shall affect TEDCO’s right to serve process in any other manner permitted by law.

11.             Notices.  Any notice or other communication to the Borrower shall be deemed to have been properly given when delivered in accordance with Section 10 above.

12.             Expenses of Collection.  If this Note is referred to an attorney for collection after a Default, the Borrower shall pay all costs of collection, including an attorney's fee equal to 15% of the sum of the principal balance then outstanding hereunder.

13.             Subsequent Holder.  TEDCO may pledge, transfer, or assign this Note.  Any pledge, transfer or assignment of rights shall also apply to any renewals, extensions, or modifications.  A transferee, pledgee, or assignee shall have the same rights as TEDCO with respect to this Note.

14.             Waiver of Protest.  The Borrower and all other parties to this Note, including any maker, endorser, or guarantor, waive presentment, notice of dishonor, and protest.

15.             Choice of Law; Modifications; Cumulative Rights; Extensions of Maturity.

(a)           This Note shall be governed by the laws of the State of Maryland.

(b)           No modification or amendment of this Note shall be effective unless in writing signed by TEDCO and the Borrower, and any modification or amendment shall apply only with respect to the specific instance involved.

(c)           No waiver of any provision of this Note shall be effective unless in writing signed by TEDCO.  Any waiver shall apply only with respect to the specific instance involved.

(d)           By accepting partial payment of any amount due under this Note, TEDCO does not waive the right either to require prompt payment when due of all other amounts due under this Note or to exercise any rights and remedies available to it in order to collect all other amounts due under this Note.

  

  

  

(e)           Each right and remedy of TEDCO under this Note or under law shall be cumulative and concurrent, and the exercise of any one of them shall not preclude the simultaneous or later exercise of any other.

(f)           No failure or delay by TEDCO to insist upon the strict performance of any provision of this Note, or to exercise any right or remedy consequent upon a breach of any provision, shall constitute a waiver of any provision or preclude TEDCO from exercising any such right or remedy.

16.           Illegality.  If any provision of this Note is found to be invalid, illegal, or unenforceable in any respect, the invalidity, illegality, or unenforceability shall not affect any other provision of this Note, but this Note shall be construed as if the invalid, illegal, or unenforceable provision had never been part of this Note, but only to the extent it is invalid, illegal, or unenforceable.

IN WITNESS WHEREOF, the undersigned executes this Note under seal as Borrower on the above written date.

 

 

	 WITNESS:	 	 	 BORROWER:
	 	 	 	 
	 	 	 	Audioeye, Inc.
	 	 	 	 
	 ____________________________________________	 	 	By: ____________________________________________ (SEAL)
	Name: _______________________________________	 	 	Name: __________________________________________
	 	 	 	Title: ___________________________________________
	 	 	 	 

 

 

STATE OF ________________, COUNTY OF ________________:

On this ___ day of October, 2011, before me, the undersigned Notary Public, personally appeared _________________, who acknowledged him/herself to be the _____________ of Audioeye, Inc., a Delaware corporation and, being authorized to do so and in that capacity, he/she executed this document for the purposes therein contained.

AS WITNESS my hand and Notarial Seal.

___________________________________

Notary Public

My Commission expires: ____________

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