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Exhibit 10.7
THE INDEBTEDNESS EVIDENCED BY THIS PROMISSORY NOTE AND THE SECURITY THEREFOR ARE
SUBORDINATE TO THE INDEBTEDNESS AND SECURITY THEREFOR OF THE MAKER (OR ANY
SUCCESSOR THERETO) TO BANK ONE, CLEVELAND, NA AND NBD BANK TO THE EXTENT AND
PURSUANT TO THE TERMS OF A SUBORDINATION AGREEMENT DATED NOVEMBER 25, 1996 (OR
ANY SUCCESSOR AGREEMENT WHICH REPLACES AND REFERENCES SUCH AGREEMENT).
TERM NOTE
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$3,000,000.00 November 26, 1996
FOR VALUE RECEIVED, the undersigned, INTERNATIONAL TOTAL SERVICES, INC.
("Maker"), hereby jointly and severally promises to pay to the order of Xxxxxxx
Capital Partners L.P., a Delaware limited partnership (together with its
successors and assigns, herein called the "Lender"), at its offices at 3030
Plaza VII, 00 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000 (or at such
other place as the holder may from time to time designate) the principal sum of
THREE MILLION AND NO/100 DOLLARS ($3,000,000.00) (the "ORIGINAL PRINCIPAL
Balance") together with interest, as provided herein.
This Note is the Note referred to in the Note Purchase Agreement dated
the date hereof by and between the undersigned and Lender (the "PURCHASE
AGREEMENT"). Capitalized terms used in this Note and not otherwise defined shall
have the meaning ascribed thereto in the Purchase Agreement. This Note is
entitled to the benefits of the Purchase Agreement. Payment of this Note is
secured pursuant to the terms of the Security Documents. This Note may not be
prepaid, in whole or in part, except in accordance with the terms and conditions
set forth in the Purchase Agreement.
The outstanding principal balance of this Note shall be due and payable
in immediately available funds as provided in SECTION 3.1(a) of the Purchase
Agreement. Interest on the principal amount of this Note from time to time
outstanding shall be due and payable in immediately available funds as provided
in SECTION 3.1(b) of the Purchase Agreement, at the annual rate of interest set
forth in SECTION 2.1 of the Purchase Agreement (computed on the basis of the
actual number of days elapsed over a 360-day year). In no event, however, shall
interest exceed the maximum rate permitted by law.
As provided in SECTION 9.2 of the Purchase Agreement, (a) upon the
occurrence of an Event of Default under SECTION 9.1(f) of the Purchase
Agreement, this Note, and all amounts payable hereunder in accordance with the
terms of the Purchase Agreement and all other Obligations, shall immediately
become due and payable, without notice of any kind, and (b) upon the declaration
of Lender following the occurrence of any other Event of Default under the
Purchase Agreement, this Note, and all amounts payable hereunder in accordance
with the terms of the Purchase Agreement and all other Obligations, shall be
immediately due and payable.
THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE
INTERNAL LAWS OF THE STATE OF MINNESOTA WITHOUT GIVING EFFECT TO THE
CHOICE-OF-LAW RULES THEREOF OR ANY OTHER PRINCIPLES THAT COULD REQUIRE THE
APPLICATION OF THE SUBSTANTIVE LAW OF ANY OTHER JURISDICTION. THE UNDERSIGNED
CONSENTS TO THE PERSONAL JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED IN
THE STATE OF MINNESOTA IN CONNECTION WITH ANY CONTROVERSY RELATED TO THIS
AGREEMENT, WAIVES ANY ARGUMENT THAT VENUE IN ANY SUCH FORUM IS NOT CONVENIENT,
AND AGREES THAT ANY LITIGATION INITIATED BY ANY OF THEM IN CONNECTION WITH THIS
AGREEMENT SHALL BE
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VENUED IN EITHER THE DISTRICT COURT OF HENNEPIN COUNTY OR XXXXXX COUNTY,
MINNESOTA, OR THE UNITED STATES DISTRICT COURT, DISTRICT OF MINNESOTA.
The undersigned expressly waives any presentment, demand, protest,
notice of default, notice of intention to accelerate, notice of acceleration or
notice of any other kind except as expressly provided in the Purchase Agreement.
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE UNDERSIGNED EACH
HEREBY IRREVOCABLY AND EXPRESSLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY
ARISING OUT OF OR RELATING TO THIS NOTE, THE PURCHASE AGREEMENT OR ANY OTHER
AGREEMENT ENTERED INTO IN CONNECTION THEREWITH OR THE TRANSACTIONS CONTEMPLATED
THEREBY OR THE ACTIONS OF LENDER IN THE NEGOTIATIONS, ADMINISTRATION OR
ENFORCEMENT THEREOF.
INTERNATIONAL TOTAL SERVICES,
INC,
By:
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Name:
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Title:
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