SEC Contract Filing

Filing Date: 2022-10-28

Document Content:
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<TYPE>EX-10.1
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<FILENAME>e617980_ex10-1.htm
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">Exhibit 10.1</P>

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 <TD STYLE="width: 54%; font-size: 10pt"><FONT STYLE="font-size: 10pt"><B>Principal Amount: $1,000,000</B></FONT></TD>
 <TD STYLE="text-align: right; width: 46%; padding-left: 86.6pt; font-size: 10pt"><FONT STYLE="font-size: 10pt"><B>Issue Date: October 25, 2022</B></FONT></TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 125.25pt 0pt 124.3pt; text-align: center"><B>PROMISSORY NOTE (this &ldquo;Note&rdquo;)</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 15.75pt 0pt 14.95pt; text-align: justify; text-indent: 0.5in"><B>FOR VALUE
RECEIVED</B>, <B>SCHMITT INDUSTRIES, INC.</B>, an Oregon corporation (hereinafter called the &ldquo;Borrower&rdquo; or the &ldquo;Company&rdquo;)
(Trading Symbol: SMIT), hereby promises to pay to the order of Sententia Capital Management, LLC, a New York limited liability company,
or its registered assigns (the &ldquo;Holder&rdquo;), in the form of lawful money of the United States of America, the principal sum of
$1,000,000.00 (the &ldquo;Principal Amount&rdquo;), and to pay interest on the unpaid Principal Amount hereof at the rate of twelve percent
(12%) (the &ldquo;Interest Rate&rdquo;) per annum from the date hereof (the &ldquo;Issue Date&rdquo;) until the same becomes due and payable,
whether at maturity or upon acceleration or by prepayment or otherwise, as further provided herein. The maturity date shall be the earlier
of (a) one (1) year from the Issue Date, subject to two (2) six-month extensions at the option of the Company, or (b) the occurrence of
an Event of Default (the &ldquo;Maturity Date&rdquo;), and is the date upon which the Principal Amount and any accrued and unpaid interest
and other fees, shall be due and payable.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 50.9pt">This Note may not be prepaid or repaid in whole or in part
except as otherwise explicitly set forth herein.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 15.85pt 0pt 14.9pt; text-align: justify; text-indent: 35.95pt">Any Principal
Amount or interest on this Note which is not paid when due shall bear interest at the rate of the lesser of (i) twenty two percent (22%)
per annum and (ii) the maximum amount permitted by law from the due date thereof until the same is paid (&ldquo;Default Interest&rdquo;).
Interest and Default Interest shall be computed on the basis of a 365-day year and the actual number of days elapsed.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 15.7pt 0pt 14.9pt; text-align: justify; text-indent: 0.5in">All payments
due hereunder shall be made in lawful money of the United States of America. All payments shall be made at such address as the Holder
shall hereafter give to the Borrower by written notice made in accordance with the provisions of this Note. Whenever any amount expressed
to be due by the terms of this Note is due on any day which is not a business day, the same shall instead be due on the next succeeding
day which is a business day.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 15.8pt 0pt 14.85pt; text-align: justify; text-indent: 0.5in">As used in
this Note, the term &ldquo;business day&rdquo; shall mean any day other than a Saturday, Sunday or a day on which commercial banks in
the city of New York, New York are authorized or required by law or executive order to remain closed; <FONT STYLE="letter-spacing: 0.15pt">provided,
for the avoidance of doubt, that no such commercial banks shall be considered to be authorized or required by law or executive order to
remain closed as a result of &ldquo;stay at home&rdquo;, &ldquo;shelter-in-place&rdquo;, &ldquo;non-essential employee&rdquo; or other
similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long
as the electronic funds transfer systems (including for wire transfers) of such commercial banks are generally open for sue by customers
on such day</FONT>.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 15.7pt 0pt 15pt; text-align: justify; text-indent: 35.95pt">This Note
is free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights
or other similar rights of shareholders of the Borrower and will not impose personal liability upon the holder thereof.</P>

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