Exhibit 10.26
NOTE
U.S. $200,000.00 Front Royal, Virginia
August 15, 2003
FOR VALUE RECEIVED, SYNDICATED FOOD SERVICE INTERNATIONAL, INC., a
corporation organized under the laws of the State of Florida (the "Borrower"),
hereby promises to pay to the order of PROSKAUER ROSE LLP (the "Lender"), having
offices at 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Office"), in lawful
money of the United States of America in immediately available funds at the
Office the principal sum of Two Hundred Thousand United States dollars
(U.S.$200,000.00) on August 14, 2004 (the "Maturity Date").
The Borrower promises also to pay interest on the unpaid principal
amount of this Note from the date hereof until the Maturity Date (whether by
acceleration or otherwise) at a rate per annum which shall be equal to the Base
Rate in effect from time to time, plus 1 1/2%, but in no event at less than a
rate per annum of 6%. Overdue principal, and to the extent permitted by law,
overdue interest in respect of the Note and on any other overdue amount payable
by the Borrower shall bear interest at a rate per annum equal to 10% ("Default
Rate"); provided however, that the Borrower shall pay interest at the Default
Rate after the Maturity Date or upon an occurrence of an Event of Default at a
rate per annum equal to the higher of (i) Default Rate; or (ii) 2% in excess of
the Base Rate, plus 1 1/2%;
Interest on this Note shall be payable quarterly on the last Business
Day of each calendar quarter (commencing December 31, 2003 and upon the Maturity
Date). Upon the occurrence of any of the following specified events (each an
"Event of Default):
a) The Borrower shall (i) default the payment then due of any
principal of any of this Note; or (ii) default, and such default shall
continue unremedied for five or more Business Days in the payment when due
of any interest on this Note or the principal hereof;
b) The Borrower or any of its subsidiaries shall hereafter; (i)
default in any payment of all or any portion of any indebtedness (in excess
of $150,000, in the aggregate) beyond the period of grace, if any, provided
in the instrument of agreement under which such indebtedness is created, or
(ii) default in the observance or performance or any agreement, covenant or
condition relating to any indebtedness, other than this Note, or any other
event which occur or condition existing the effect of which default or
other event or condition, in each case, is to cause or permit the holder or
holders of such indebtedness to cause (determined without regard to whether
any notice is required) any such indebtedness to become due;
c) One or more judgments or decrees shall be hereafter entered
against the Borrower or any of its subsidiaries, involving in the aggregate
for the Borrower and its subsidiaries, the liability (if not fully covered
by insurance) of $150,000 or more, exclusive of Platinum Funding
Corporation;
d) The Borrower or any of its subsidiaries shall hereafter incur
any indebtedness senior to the indebtedness under this Note;
e) The Borrower or any of the following subsidiaries - Xxxxxxx
Food Service, Inc., Xxxxxxx Transportation, Inc., Syndicated Bloomington I
LLC, and Momentum Food Services, Inc. - files voluntary petition in
bankruptcy under the United States Bankruptcy Code as now or hereafter in
effect or under any other jurisdiction or an involuntary case under any
such statute as commenced against the Borrower or any of such subsidiaries
and the petition is not contraverted within 10 days or is not dismissed
within 30 days after commencement of the case, or the Borrower or any of
its subsidiaries commences any other proceeding under reorganization,
arrangement, adjustment of debt, relieving of debtors, dissolution,
insolvency or liquidation similar law of any jurisdiction, whether now or
hereafter in effect relating to the Borrower or any of its subsidiaries or
any such proceeding.
f) In the event of the sale of substantially all of the assets of
the Borrower (or any of its subsidiaries having revenues or assets in
excess of $500,000) or, if the successor is not as financially secure as
the Borrower, upon the merger, consolidation or reorganization of the
Borrower or any of its subsidiaries having revenues or assets in excess of
$500,000 or such corporate actions in any six month period, in the
aggregate, occur or there is a change in control of the Borrower or any of
its subsidiaries
then, upon the occurrence of any such Event of Default , and at any time
thereafter, if any Event of Default shall then be continuing; then the Lender
may declare that the entirety of the principal hereof, and the interest due
hereunder, to be immediately due and payable.
The Borrower shall have the right to prepay the principal amount of
this Note at any time, or from time to time, without penalty or premium,
provided that each such payment shall be with accrued interest to the date of
prepayment.
A Business Day when used herein shall mean any day other than a
Saturday, Sunday or a day on which commercial banks are closed in the City of
New York. If a payment is due hereunder on a day which is not a Business Day
then payment shall be made on the preceding Business Day.
Base Rate shall mean the rate which Citibank N.A. announces from time
to time as its base rate, the Base Rate to change when and as such base rate
changes. The Base Rate is a reference rate which does not necessarily represent
the lowest or best rate actually charged to any customer. Citibank N.A. may make
commercial loans or other loans at rates of interest, above or below the Base
Rate.
Any fees (including attorney's fees of the Lender at normal billing
rates for attorneys in its offices), costs or expenses incurred by the Lender in
collecting or enforcing the obligations of the Borrower under this Note shall be
due and payable by the Borrower when incurred (with a grace period of 5 Business
Days after notice thereof to Borrower. Any unpaid portion of the amounts set
forth in the preceding sentence shall bear interest at the Default Rate.
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Any notice required or permitted hereunder shall be in writing an
delivered either personally or in writing, by certified mail, return receipt
requested or by facsimile transmission (if the Lender to it at (000) 000 0000,
Attention, Executive Director or if to the Borrower at (000) 000 0000,
Attention: Chief Executive Officer) to the Borrower or Lender at the addresses
set forth at the outset hereof or to such other address as either shall give
notice to the other.
The Borrower hereby waives presentment, demand protest or notice of any
kind in connection with this Note.
SYNDICATED FOOD SERVICE INTERNATIONAL, INC.
By:________________________________________
Xxxxxx X. Xxxxx, Xx.
President and Chief Executive Officer
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