Exhibit 10.2
TERM NOTE
Los Angeles, California
U.S. $5,000,000 May 20, 2004
FOR VALUE RECEIVED, the undersigned, SAVON TEAM SPORTS, INC., a Utah
corporation (the "Borrower"), HEREBY UNCONDITIONALLY PROMISES TO PAY to the
order of SWT, LLC (the "Lender"), without offset or counterclaim, the principal
sum of Five Million U.S. Dollars (U.S.$5,000,000) on or before the Maturity Date
(as such term is defined in the Loan Agreement referred to below). The Borrower
further promises to pay interest on the Term Loan outstanding hereunder from
time to time at the interest rates, and payable on the dates, set forth in the
Loan Agreement referred to below. This Term Note may be prepaid at any time
prior to the Maturity Date without premium or penalty, and shall be prepaid upon
the occurrence of certain events set forth in, and in accordance with the terms
of, the Loan Agreement.
1. PAYMENT. Both principal and interest are payable in lawful money of the
United States of America and in immediately available funds to the Lender at c/o
Glenhaven Corporation, 0000 Xxxxxx Xxxxxxxxx, Xxxxx 000, Xxx Xxxxxxx, Xxxxxxxxxx
00000, or such other place as the Lender may designate in writing to the
Borrower from time to time.
2. RECORD KEEPING. The Lender shall record the amount of principal and
interest due and payable from time to time hereunder, each payment thereof and
the resulting unpaid principal balance hereof, in the Lender's internal records,
and any such recordation shall be rebuttable presumptive evidence of the
accuracy of the information so recorded; PROVIDED, HOWEVER, that the Lender's
failure so to record shall not limit or otherwise affect the obligations of the
Borrower hereunder and under the Loan Agreement to repay the principal of and
interest on the Term Loan.
3. LOAN AGREEMENT. This Term Note is subject to and entitled to the
benefits of that certain Loan Agreement, dated of even date herewith (as
amended, modified, renewed or extended from time to time, the "Loan Agreement")
between the Borrower and the Lender. Unless otherwise defined herein,
capitalized terms used herein shall have the respective meanings assigned to
them in the Loan Agreement. The Loan Agreement provides, among other things, for
acceleration (which in certain cases shall be automatic) of the maturity hereof
upon the occurrence of certain stated events, in each case without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly
waived. This Term Note is secured by certain Collateral more specifically
described in the Pledge Agreement.
4. LIMITATION ON INTEREST RATE. In no contingency or event whatsoever
shall the aggregate of all amounts deemed interest hereunder or under the Loan
Agreement and charged or collected by the Lender or any holder of this Term Note
exceed the highest rate permissible under any law which a court of competent
jurisdiction shall, in a final determination, deem applicable hereto. In the
event that such a court determines that the Lender has charged or received
interest hereunder or under the Loan Agreement in excess of the highest
applicable rate, the rate in effect hereunder and under the Loan Agreement shall
automatically be reduced to the maximum rate permitted by applicable law and the
Lender shall apply all interest paid in excess of the maximum lawful rate to
reduce the principal balance of the amounts outstanding hereunder and under the
Loan Agreement. It is the intent of the parties hereto that the Borrower not pay
or contract to pay, and that the Lender not receive or contract to receive,
directly or indirectly in any manner whatsoever, interest in excess of the
maximum rate of interest that may be paid by the Borrower to the Lender under
applicable law.
5. GOVERNING LAW. THIS TERM NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF CALIFORNIA, EXCLUSIVE OF ITS CONFLICTS
OF LAWS AND CHOICE OF LAWS RULES THAT WOULD OR MAY CAUSE THE APPICATION OF THE
LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF CALIFORNIA.
SAVON TEAM SPORTS, INC.
By:
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Xxxxxxx Xxxx, Chief Executive Officer
