TIME NOTE
Exhibit 10.2
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$975,000.00
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March 24,
2008
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FOR VALUE RECEIVED, USDC PORTSMOUTH,
INC., a California
corporation (“Borrower”), hereby promises to pay to the
order of NEWSTAR FINANCIAL,
INC., a Delaware corporation (“Lender”),
or to its order, at its office at 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx
00000, the principal sum of Nine Hundred Seventy-Five Thousand Dollars
($975,000.00) (subject to Section 14 below), together with interest in arrears
on the unpaid principal balance from time to time outstanding hereunder from the
date hereof until the entire principal amount due hereunder is paid in full at
the rates hereinafter provided.
1. Interest
Rate. Except as otherwise provided in Section 2.9 hereof, principal amounts
outstanding under this Note (and to the extent not prohibited by applicable law,
overdue interest) shall bear interest at an annual rate equal to ten percent
(10.00%) (the “Interest
Rate”), subject to the conditions and limitations provided for in this
Note.
2. Payment
of Interest and Principal.
2.1. Payment
and Calculation of Interest. All interest shall be payable in
arrears at the end of each two-month period after the date of this Note (each an
“Interest
Period”) commencing on May 26, 2008, and on the Time Note Maturity Date
until the principal together with all interest and other charges payable with
respect to this Note shall be fully paid. All computations of
interest shall be made on the basis of a three hundred sixty (360) day year and
the actual number of days elapsed. Interest shall be computed from
and including the first day of the applicable Interest Period through the last
day thereof.
2.2. Maturity
Date. The then unpaid principal balance outstanding hereunder
shall be due and payable in full on September 24, 2008 (the “Time Note
Maturity Date”).
2.3. Prepayment;
Set Off. This Note or any portion thereof may be prepaid in
full or in part at any time. Each principal prepayment shall be
accompanied by payment of the interest accrued on the principal payment so
prepaid through the date of prepayment. The outstanding principal
amount of this Note may also be reduced by the amount of any set offs permitted
under Section 1.7 and Article 8 of the Secured Party Sale Agreement dated the
date hereof (the “Secured
Party Sale Agreement”) between Borrower and Lender.
2.5. Maturity. At
Maturity all accrued interest, principal and other charges due with respect to
this Note shall be due and payable in full and the principal balance and such
other charges, but not unpaid interest, shall continue to bear interest at the
Default Rate until so paid.
2.6. Method of
Payment; Date of Credit; Payment Date Adjustments; Automatic
Payments.
2.6.1. Method of
Payment. All payments of interest, principal and fees shall be
made by Borrower to Lender, without counterclaim or setoff and free and clear
of, and without any deduction or withholding for, any taxes or other payments,
in lawful currency of the United States of America in immediately available
funds: (i) by wire transfer to Lender or (ii) by check payable to
Lender and delivered to Lender at 000 Xxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx,
Xxxxxxxxxxxxx 00000, or (iii) to such other address as the holder of this Note
may from time to time specify in writing or (iv) to the extent provided in the
Secured Party Sale Agreement. Payments shall be credited on the
Business Day on which immediately available funds are received prior to 3:00
p.m. (Boston, Massachusetts time); payments received after 3:00 p.m. (Boston,
Massachusetts time) shall be credited to this Note on the next Business
Day. Payments that are by check shall be provisionally credited to
this Note until the item is finally paid by the payor bank and become
immediately payable funds.
2.6.2. Adjustment
for Non-Business Days. All payments hereunder shall be
adjusted if any relevant date would otherwise fall on a day that is not a
Business Day so that the date will be the first following day that is a Business
Day.
2.7. Application
of Payments. Except as otherwise expressly set forth herein,
all payments received will be applied first to interest, then to fees and then
to principal; provided, however, that after
the occurrence and during the continuance of an Event of Default, payments will
be applied to the obligations of Borrower to Lender as Lender determines in its
sole discretion.
2.8. Default
Rate. Upon the occurrence and during the continuance of an
Event of Default (whether or not Lender has accelerated payment of this Note),
or after Maturity or after judgment has been rendered on this Note, the unpaid
principal of this Note shall, at the option of Lender, bear interest at a rate
which is four (4) percentage points per annum above the Interest Rate (the
“Default
Rate”).
2.9. Late
Fee. If a regularly scheduled payment of interest is fifteen
(15) days or more late, Borrower will be charged 5.00% of the unpaid portion of
such regularly-scheduled payment or $10.00, whichever is greater. If
Lender accelerates payment of this Note in accordance with the terms hereof, and
Borrower does not pay the outstanding principal balance hereof in full within
fifteen (15) days after Xxxxxx’s demand, Borrower will be charged either 5.00%
of the unpaid principal plus accrued unpaid interest or $10.00, whichever is
greater. Late fees are: (a) payable in addition to, and
not in limitation of, the Default Rate, (b) intended to compensate Lender
for administrative and processing costs incident to late payments, (c) are not
interest, and (d) shall not be subject to refund or rebate or credited against
any other amount due.
3. Certain
Definitions and Provisions Relating To Interest Rate. In
addition to terms defined elsewhere in this Note, the following terms shall have
the definitions set forth below:
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3.1. Business
Day. The term “Business Day”
shall mean any day other than a Saturday, Sunday or other day when commercial
banks are authorized or required to be closed in Boston,
Massachusetts.
3.2. Default
Rate. The term “Default
Rate” shall have the meaning set forth in Section 2.9
hereof.
3.3. Dollars. The
term “Dollars”
or “$”
means lawful money of the United States.
3.4. Interest
Period. The term “Interest
Period” shall have the meaning set forth in Section 2.1
hereof.
3.5. Maturity. The
term “Maturity”
means the earlier to occur of the Time Loan Maturity Date or the acceleration of
this Note by Lender upon an Event of Default.
3.6. Time Note
Maturity Date. The term “Time Note
Maturity Date” has the meaning set forth in Section 2.2
above.
4. Additional
Provisions Related to Interest Rate Selection.
4.1. Payments
Net of Taxes. All payments and prepayments of principal and
interest under this Note shall be made net of any taxes and
costs. Without limiting the generality of the preceding obligation,
illustrations of such taxes and costs are taxes, or the withholding of amounts
for taxes, of any nature whatsoever including income, excise and interest
equalization taxes (other than United States or state income taxes) as well as
all levies, imposts, duties or fees whether now in existence or as the result of
a change in or promulgation of any treaty, statute, regulation, or
interpretation thereof or any directive guideline or otherwise by a central bank
or fiscal authority (whether or not having the force of law) or a change in the
basis of, or the time of payment of, such taxes and other amounts resulting
therefrom.
5. Security;
Guaranty. This Note is secured by certain Security Documents
(which documents, together with any other instrument securing this Note and as
may be amended from time to time, are hereinafter collectively referred to as
the “Security
Documents”) including without limitation a Security Agreement dated as of
the date hereof between Borrower and Lender and a Pledge Agreement dated as of
the date hereof between Guarantor and Lender. This Note is entitled
to all of the benefits of the Security Documents, and specific reference is
hereby made to such instruments for all purposes. In addition Lender
shall benefit from a Guaranty dated the date hereof (the “Guaranty”
and together with this Note and the Security Documents, the “Loan
Documents”) by US Dry Cleaning Corporation (the “Guarantor”).
6. Events of Default;
Acceleration of Maturity. (a) The occurrence of any
one or more of the following continuing beyond applicable notice and cure
periods, if any, will constitute an “Event of
Default” hereunder:
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(i). Payment
Default. Borrower shall fail to make payment of any (a) principal due
and payable under this Note or (b) within five (5) days after the same becomes
due, interest or other amounts due and payable under this Note (no prior demand
therefor being necessary).
(ii) Other
Payment Defaults. Borrower or Guarantor shall fail to make payment ,
within five (5) days of when due, of any other sum payable under the Loan
Documents, or any other documents, instruments or agreements (“Other
Documents”) now or hereafter securing this Note or executed by Borrower,
or any other person, corporation or other entity now or hereafter liable,
absolutely or contingently, for the whole or any part of the indebtedness
evidenced by this Note, including, without limitation, nonpayment of the
Guaranty by the Guarantor.
(iii) Limitation
on Indebtedness. Borrower shall issue evidences of indebtedness, or
create, assume, become or remain contingently liable for, or suffer to exist, or
pledge any assets to secure, any indebtedness, except for (a) this Note, (b)
Borrower’s guaranty (as amended from time to time, the “Senior
Guaranty”) of the indebtedness of Guarantor under that certain
Convertible Note dated March 12, 2008 (as amended from time to time, the “Senior
Note” and collectively with the Senior Guaranty, the “Senior
Loan Documents”) in the original principal amount of $1,725,000.00 made
by Guarantor to the order of Setal 2, LLC (c) liabilities of Borrower (other
than liabilities incurred for borrowed money) which arise in the ordinary course
of its business, (d) liabilities under capitalized leases entered into by
Borrower in the ordinary course of its business for the lease of equipment used
in Borrower’s business and (e) purchase money indebtedness entered into by
Borrower in the ordinary course of its business for the acquisition of equipment
used in Borrower’s business (provided if such indebtedness is secured only the
acquired equipment (and no other assets of Borrower) shall secure any such
indebtedness).
(iv) Performance
Default. Nonperformance or nonobservance of any of the other
representations, covenants, agreements, or conditions of the Loan Documents, or
any of the Other Documents (which has not been cured within ten (10) Business
Days after Lender delivering written notice of the same).
(v) Cross-Default:
Other Lender Documents. The occurrence of any “Event of Default” or any default,
breach or non performance under any other Loan Document or any of the Other
Documents, or the occurrence of any event or condition which would entitle
Lender to exercise any of its remedies under the Loan Documents or any of the
Other Documents.
(vi) Cross-Default:
Other Indebtedness. Default in respect of the Senior Loan Documents
not cured within thirty (30) days of such default, maturity of any indebtedness
of Borrower or the Guarantor owing to persons or entities other than the Lender
without full payment at maturity; provided, that the amount due at
maturity shall be equal to or exceed $2,000,000, or acceleration of the any
indebtedness of Borrower or the Guarantor owing to persons or entities other
than the Lender; provided, that the principal
amount of such indebtedness shall equal or exceed $2,000,000 or shall be in
respect of the Senior Loan Documents.
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(vii) (a)
Insolvency. (i) The insolvency or inability of Borrower or the Guarantor to pay
its debts as they mature; (ii) the appointment of a receiver, trustee, custodian
or other fiduciary, for, or for any of the property of, Borrower or the
Guarantor; or (iii) the making of an assignment for the benefit of creditors, or
the making of or entering into a trust mortgage or deed or other instrument of
similar import for the benefit of creditors, by Borrower or the Guarantor;
or
(b)
Bankruptcy. (1) The filing of a petition, complaint, motion or other
pleading seeking any relief under any receivership, insolvency, or debtor relief
law, or seeking any readjustment of indebtedness, reorganization, composition,
extension or any similar type of relief, or the filing of a petition, complaint,
or motion under any chapter of the federal bankruptcy code, 11 U.S.C. §101 et
seq., as the same now exists or may hereafter be amended (the “Bankruptcy
Code”), in each case in respect of by Borrower or the Guarantor and by or
with the consent of Borrower or the Guarantor.
(2)
The filing of a petition, complaint, motion or other pleading seeking any relief
under any receivership, insolvency, or debtor relief law, or seeking any
readjustment of indebtedness, reorganization, composition, extension or any
similar type of relief, or the filing of a petition, complaint, or motion under
any chapter of the Bankruptcy Code against Borrower or the Guarantor, which is
not dismissed within sixty (60) days.
(viii) Judgments,
Etc. The entry of any judgment against, or the attachment or
garnishment of any of the property, goods or credits of, Borrower in excess of
$1,000,000 or the Guarantor in excess of $2,000,000 which remains unpaid,
unstayed, undismissed or unbonded for a period of sixty (60) days; or if any
foreclosure is instituted (by judicial proceedings, by publication of notice
pursuant to a power of sale or otherwise) against Borrower or the Guarantor
under any mortgage, deed of trust or security agreement and is not dismissed or
terminated for a period of fifteen (15) days (other than any judgment,
attachment or garnishment relating to any claim for which Borrower is entitled
to be indemnified under the Secured Party Sale Agreement; provided that Borrower
has delivered timely notice of any such claim in accordance with the Secured
Party Sale Agreement (such claims, the “Excluded
Claims”)).
(ix) Dissolution.
Etc. The dissolution, liquidation or termination of existence of
Borrower or the Guarantor or a sale of assets of Borrower or the Guarantor out
of the ordinary course of business.
(x) Change
in Control. Guarantor shall cease to own 100% of the capital stock of
the Borrower.
(xi) Mergers.
Etc. The merger or consolidation with any corporation by Borrower, or
the transfer of any of the capital stock of Borrower by any of the present
stockholders thereof, or dilution of the percentage of the outstanding capital
stock of, or voting rights in Borrower held by any of the present stockholders
thereof, without the prior written consent of the Lender.
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(xiii) Lien
Priority. Lender fails to have an enforceable and perfected lien on
or security interest in any property given as security for this Note (or any
guaranty) (other than such failures that result from an Excluded Claim) or any
party to any Security Document or Guaranty shall contest its obligations
thereunder, which lien shall be subject only to the liens granted under the
Senior Loan Documents.
(b) Upon
the occurrence and during the continuance of any Event of Default and the
expiration of any period provided in such instrument to cure such Event of
Default, then Xxxxxx may declare the entire unpaid principal balance hereunder
immediately due and payable without notice, demand or presentment and may
exercise any of its rights under the Security Documents. In the event
that Lender or any subsequent holder of this Note shall exercise or endeavor to
exercise any of its remedies hereunder or under the Security Documents, Borrower
shall pay on demand all reasonable costs and expenses incurred in connection
therewith, including, without limitation, reasonable attorneys’ fees and Lender
may take judgment for all such amounts in addition to all other sums due
hereunder.
7. Certain
Waivers, Consents and Agreements. Each and every party liable
hereon or for the indebtedness evidenced hereby whether as maker, endorser,
guarantor, surety or otherwise hereby: (a) waives presentment,
demand, protest, suretyship defenses and defenses in the nature thereof; (b)
waives any defenses based upon and specifically assents to any and all
extensions and postponements of the time for payment, changes in terms and
conditions and all other indulgences and forbearances which may be granted by
the holder to any party now or hereafter liable hereunder or for the
indebtedness evidenced hereby; (c) agrees to any substitution, exchange,
release, surrender or other delivery of any security or collateral now or
hereafter held hereunder or in connection with the Security Documents, or any of
the other Loan Documents, and to the addition or release of any other party or
person primarily or secondarily liable; (d) agrees that if any security or
collateral given to secure this Note or the indebtedness evidenced hereby or to
secure any of the obligations set forth or referred to in the Security
Documents, or any of the other Loan Documents, shall be found to be
unenforceable in full or to any extent, or if Lender or any other party shall
fail to duly perfect or protect such collateral, the same shall not relieve or
release any party liable hereon or thereon nor vitiate any other security or
collateral given for any obligations evidenced hereby or thereby; and (e)
consents to all of the terms and conditions contained in this Note, the Security
Documents, and all other instruments now or hereafter executed evidencing or
governing all or any portion of the security or collateral for this Note and for
any one or more of the other Loan Documents.
8. Delay Not
A Bar. No delay or omission on the part of the holder in
exercising any right hereunder or any right under any instrument or agreement
now or hereafter executed in connection herewith, or any agreement or instrument
which is given or may be given to secure the indebtedness evidenced hereby or
any other agreement now or hereafter executed in connection herewith or
therewith shall operate as a waiver of any such right or of any other right of
such holder, nor shall any delay, omission or waiver on any one occasion be
deemed to be a bar to or waiver of the same or of any other right on any future
occasion.
9. Partial
Invalidity. The invalidity or unenforceability of any
provision hereof, of the other Loan Documents, or of any other instrument,
agreement or document now or hereafter executed in connection herewith made
pursuant hereto and thereto shall not impair or vitiate any other provision of
any of such instruments, agreements and documents, all of which provisions shall
be enforceable to the fullest extent now or hereafter permitted by
law.
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10. Waiver of
Trial by Jury. XXXXXXXX AND LENDER (BY ACCEPTANCE OF THIS
NOTE) MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT
TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS NOTE OR ANY OTHER LOAN DOCUMENTS CONTEMPLATED TO BE
EXECUTED IN CONNECTION HEREWITH OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY, INCLUDING,
WITHOUT LIMITATION, ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS OR
ACTIONS OF LENDER RELATING TO THE ADMINISTRATION OF DEBT DESCRIBED HEREIN OR
ENFORCEMENT OF THE LOAN DOCUMENTS, AND AGREE THAT NO PARTY WILL SEEK TO
CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT
BE OR HAS NOT BEEN WAIVED. EXCEPT AS PROHIBITED BY LAW, EACH OF
BORROWER AND LENDER HEREBY WAIVEs ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN
ANY LITIGATION ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY
DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES. BORROWER
CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF XXXXXX HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT XXXXXX WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER. THIS WAIVER CONSTITUTES A MATERIAL
INDUCEMENT FOR LENDER TO ACCEPT THIS NOTE AND MAKE THE LOANS DESCRIBED
HEREIN.
11. Governing Law;
Consent to Jurisdiction. This Note and the rights and
obligations of the parties hereunder shall be governed by and construed and
interpreted in accordance with the laws of The Commonwealth of Massachusetts,
except to the extent that such laws are superseded by Federal enactments and
excluding the laws applicable to conflicts or choice of law. Borrower
hereby consents to personal jurisdiction in any state or Federal court located
within The Commonwealth of Massachusetts.
12. Payment
of Fees and Expenses. Borrower shall jointly and severally pay
on demand all reasonable expenses of Lender in connection with the preparation,
administration, default, collection, waiver or amendment of loan terms, or in
connection with Xxxxxx’s exercise, preservation or enforcement of any of its
rights, remedies or options hereunder, including, without limitation, reasonable
fees of outside legal counsel or the allocated costs of in-house legal counsel,
accounting, consulting, brokerage or other similar professional fees or
expenses, and any fees or expenses associated with travel or other costs
relating to any appraisals or examinations conducted in connection with the loan
or any collateral therefor, and the amount of all such expenses shall, until
paid, bear interest at the rate applicable to principal hereunder (including any
default rate) and be an obligation secured by any collateral.
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13. Compliance
with Usury Laws. Borrower shall not be obligated to pay
and Lender shall not collect interest at a rate higher than the maximum
permitted by applicable law or the maximum that will not subject Lender to any
civil or criminal penalties. If, because of the acceleration of
maturity, the payment of interest in advance or any other reason, Borrower is
required, under the provisions of any Loan Document or otherwise, to pay
interest at a rate in excess of such maximum rate, the rate of interest under
such provisions shall immediately and automatically be reduced to such maximum
rate and any payment made in excess of such maximum rate, together with interest
thereon at the rate provided herein from the date of such payment, shall be
immediately and automatically applied to the reduction of the unpaid principal
balance of this Note as of the date on which such excess payment was
made. If the amount to be so applied to reduction of the unpaid
principal balance exceeds the unpaid principal balance, the amount of such
excess shall be refunded by Lender to Borrower. As used herein, the
term “applicable
law” shall mean the law in effect as of the date hereof; provided, however, that in the
event there is a change in the law which results in a higher permissible rate of
interest, then this Note shall be governed by such new law as of its effective
date. In this regard, it is expressly agreed that it is the intent of
Xxxxxxxx and Xxxxxx in the execution, delivery and acceptance of this Note to
contract in strict compliance with the laws of the Commonwealth of Massachusetts
from time to time in effect. This provision shall control every other
provision of all agreements between Borrower and Lender.
14. Right of
Setoff. Borrower hereby grants to Lender, a continuing lien,
security interest and right of setoff as security for all liabilities and
obligations of Borrower to Lender, whether now existing or hereafter arising,
upon and against all deposits, credits, collateral and property, now or
hereafter in the possession, custody, safekeeping or control of Lender or any
entity under the control of Lender and its successors and assigns, or in transit
to any of them. At any time during the continuance of an Event of
Default, without demand or notice (any such notice being expressly waived by
Borrower), Lender may setoff the same or any part thereof and apply the same to
any liability or obligation of Borrower even though unmatured and regardless of
the adequacy of any other collateral securing this Note. ANY AND ALL
RIGHTS TO REQUIRE LENDER TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY
OTHER COLLATERAL WHICH SECURES THIS NOTE, PRIOR TO EXERCISING ITS RIGHT OF
SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF BORROWER, ARE
HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.
15. Right to
Sell a Loan to a Third Party. Lender shall have the right at
any time or from time to time, to assign all or any portion of its rights and
obligations hereunder to one or more banks or other entities (each, an “Assignee”),
and Borrower (and each Guarantor) agree that they shall execute, or cause to be
executed, such documents, including without limitation, amendments to this Note
and to any other documents, instruments and agreements executed in connection
herewith as Lender shall reasonably require to effect the foregoing; provided that (a) unless an
Event of Default has occurred and is continuing, (i) such assignment shall
require Borrower’s consent (such consent not to be unreasonably withheld or
delayed), and (ii) no Assignee may be a competitor of Borrower and/or Guarantor
and (b) any such assignment of all of Lender’s rights under this Note shall also
include an assignment of all of Lender’s rights and obligations under the
Secured Party Sale Agreement. In addition, at the request of Lender
and any such Assignee, Borrower shall issue one or more new promissory notes, as
applicable, to any such Assignee and, if Xxxxxx has retained any of its rights
and obligations hereunder following such assignment, to Lender, which new
promissory notes shall be issued in replacement of, but not in discharge of, the
liability evidenced by this Note held by Lender prior to such assignment and
shall reflect the amount of the respective commitments and loans held by such
Assignee and Xxxxxx after giving effect to such assignment. Upon the
execution and delivery of appropriate assignment documentation, amendments and
any other documentation reasonably required by Lender in connection with such
assignment, and the payment by Assignee of the purchase price agreed to by
Xxxxxx and such Assignee, such Assignee shall be a party to this Note and the
other Loan Documents and shall have all of the rights and obligations of Lender
hereunder and thereunder (and under any and all other guaranties, documents,
instruments and agreements executed in connection herewith) to the extent that
such rights and obligations have been assigned by Lender pursuant to the
assignment documentation between Lender and such Assignee, and Lender shall be
released from its obligations hereunder, thereunder and under the Secured Party
Sale Agreement to a corresponding extent. Lender may furnish any
information concerning Borrower in its possession from time to time to
prospective Assignees, provided that Lender shall require any such prospective
Assignees to agree in a writing (in form and substance reasonably satisfactory
to the Borrower) to maintain the confidentiality of such
information.
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16. Right to
Sell a Portion of a Loan to a Prospective Participant. Lender
shall have the unrestricted right at any time and from time to time, and without
the consent of or notice to Borrower, to grant to one or more banks or other
financial institutions (each, a “Participant”)
participating interests in this Note. In the event of any such grant
by Xxxxxx of a participating interest to a Participant, whether or not upon
notice to Xxxxxxxx, Lender shall remain responsible for the performance of its
obligations hereunder and Xxxxxxxx shall continue to deal solely and directly
with Lender in connection with Xxxxxx’s rights and obligations
hereunder. Lender may furnish any information concerning Borrower in
its possession from time to time to prospective Participants, provided that
Lender shall require any such prospective Participant to agree in writing to
maintain the confidentiality of such information.
17. Integration
Clause. This Note and other Loan Documents, is intended by the
parties as the final, complete and exclusive statement of the transactions
evidenced by this Note. All prior or contemporaneous promises,
agreements and understandings, whether oral or written, are deemed to be
superseded by this Note, and no party is relying on any promise, agreement or
understanding not set forth in this Note or such other Loan
Documents. This Note may not be amended or modified except by a
written instrument describing such amendment or modification executed by
Xxxxxxxx and Xxxxxx. In no event shall any oral agreements, promises,
actions, inactions, knowledge, course of conduct, course of dealing, or the like
be effective to amend, terminate, extend or otherwise modify this Note or any of
the other Loan Documents.
18. Replacement
of Promissory Note. Upon receipt of an affidavit of an officer
of Lender as to the loss, theft, destruction or mutilation of this Note or any
other Security Document(s) that is not of public record and, in the case of any
such destruction or mutilation, upon surrender and cancellation of this Note or
other Security Document(s), Borrower will issue, in lieu thereof, a replacement
note or other Security Document(s) in the same principal amount thereof and
otherwise of like tenor; provided that Xxxxxx executes and delivers to Borrower
an agreement reasonably satisfactory to Borrower that indemnifies Borrower and
Guarantor for any damages, loss or expenses incurred by Borrower and/or
Guarantor in connection with the Note being replaced.
19. Continued Liability of Borrower. Borrower
shall remain primarily liable on this Note and the Security Documents until full
payment, unaffected by any forbearance or extension of time, guaranty or
assumption by others, or by any other matter, as to all of which notice is
hereby waived by Xxxxxxxx.
20. Election
of Remedies. Xxxxxxxx waives
all rights and defenses arising out of an election of remedies by Xxxxxx, even
though that election of remedies, such as a nonjudicial foreclosure with respect
to security for a guaranteed obligation, has destroyed Xxxxxx’s rights of
subrogation and reimbursement against Borrower by the operation of
Section 580(d) of the California Code of Civil Procedure, any comparable
statute, or otherwise. As provided in Section 11, this
Agreement shall be governed by, and construed in accordance with, the laws of
the Commonwealth of Massachusetts. The foregoing provisions are
included solely out of an abundance of caution and shall not be construed to
mean that any of the above referenced provisions of California law are in any
way applicable to this Note or the other Loan Documents.
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21. Secured
Party Sale Agreements. The amounts due
the Lender under this Note shall be subject to certain set-off rights of
Borrower as more particularly set forth in Section 1.7 and Article 8 of the
Secured Party Sale Agreement.
[The
Next Page is the Signature Page]
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IN
WITNESS WHEREOF, Xxxxxxxx has caused this Note to be executed by its duly
authorized representative, officer or agent, as applicable, as an instrument
under seal as of the day and year first above written.
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USDC
PORTSMOUTH, INC.
By:
Name:
Title:
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