EXHIBIT 10(r)
AMENDMENT TO PROMISSORY NOTE
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This Amendment to Promissory Note ("the Amendment") is made at
Columbus, Ohio as of February 21st, 2002 ("the Effective Date"), by Pinnacle
Data Systems, Inc. ("Borrower"), and agreed to and acknowledged by KEYBANK
NATIONAL ASSOCIATION ("Lender").
WITNESSETH:
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WHEREAS, Borrower executed and delivered to Lender a certain
Promissory Note dated as of August 10, 2000, in the principal amount of Seven
Million and 00/100 Dollars ($7,000,000.00), as it may from time to time be
amended, restated or otherwise modified (the "Note"); and
WHEREAS, each term herein shall be defined in accordance with the Note;
and
WHEREAS, Borrower and Lender desire to modify the principal amount and
the interest rate.
NOW, THEREFORE, for good and valuable consideration, including the
terms and conditions of this Amendment, the receipt and sufficiency of which
are hereby acknowledged, Borrower states as follows:
1. The Note is hereby amended to delete "Principal Amount" in its
entirety and replace it with the following: "Principal Amount": $6,000,000.00.
2. The Note is hereby amended to delete "Initial Rate" in its entirety
and replace it with the following: "Initial Rate": 4.750%.
3. The Note is hereby amended to delete the section "Promise to Pay"
in its entirety and replace it with the following:
"Promise to Pay" Pinnacle Data Systems, Inc. ("Borrower")
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promises to pay to KeyBank National Association ("Lender"), or order,
in lawful money of the United States of America, on demand, the
principal amount of Six Million & 00/100 Dollars ($6,000,000.00) or so
much as may be outstanding, together with interest on the unpaid
outstanding principal balance of each advance. Interest shall be
calculated from the date of each advance until repayment of each
advance.
4. The Note is amended to delete the Section "Variable Interest
Rate" in its entirety and to replace it with the following:
"Variable Interest Rate" The interest rate on this Note is
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subject to change from time to time based on changes in an index which
is the Key Bank Prime (the "Index"). The interest rate will change on
the date of each announced change of the Index within KeyBank. The
Index is not necessarily the lowest rate charged by
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Lender on its loans and is set by Lender in its sole discretion. If
the Index becomes unavailable during the term of this loan, the Lender
may designate a substitute index after notifying Borrower. Lender will
tell Borrower the current Index upon Borrower's request. Borrower
understands that Lender may make loans based on other rates as well
The interest rate change will not occur more often than each day that
the rate changes. The Index currently is 4.750%. The interest rate to be
applied to the unpaid principal balance of this Note will be at a rate
equal to the Index, resulting in an initial rate of 4.750% per annum
NOTICE: Under no circumstances will the interest rate on this Note be more
than the maximum rate allowed by applicable law.
5. No possible Event of Default exists under the Note, nor will any
occur immediately after the execution and delivery of this Amendment or by the
performance or observance of any provision hereof.
6. Each reference that is made in any related security documents or
any other writing shall hereafter be construed as a reference to the Note as
amended hereby.
7. Except as expressly set forth in this Amendment, all other
conditions, covenants, obligations, provisions and terms set forth in the Note
and any security documents and in effect as of the Effective Date shall remain
in full force and effect, including, without limitation, the following for
further acknowledgment:
Borrower authorizes any attorney at law at any time or times
after maturity, to appear in any state or federal court of record in
the United States of America, to waive the issuance and service of
process, to admit the maturity of this Note and the nonpayment thereof
when due, to confess judgment against Borrower in favor of the holder
of this Note for the amount then appearing due, together with interest
and costs of suit, and thereupon to release all errors and to waive all
rights of appeal and stay of execution. The foregoing warrant of
attorney shall survive any judgment, and if any judgment be vacated for
any reason, the holder thereof nevertheless may thereafter use the
foregoing warrant of attorney to obtain an additional judgment or
judgments against Borrower. Borrower agrees that Lender=s attorney may
confess judgment pursuant to the foregoing warrant of attorney
Borrower further agrees that the attorney confessing judgment pursuant
to the foregoing warrant of attorney may receive a legal fee or other
compensation from Lender.
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WARNING --BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND COURT
TRIAL. IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU
WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT
FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR WHETHER FOR
RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH THE AGREEMENT
OR ANY OTHER CAUSE.
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PINNACLE DATA SYSTEMS, INC.
By: Xxxxxxx X. Xxxxx
Its: Executive Vice President
AGREED TO AND ACKNOWLEDGED BY:
KEYBANK NATIONAL ASSOCIATION
By: Xxxx X. Xxxxxx
Title: Vice President
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