Exhibit 10.5
SUBORDINATED SECURED TERM NOTE
$972,000 May 30, 2000
FOR VALUE RECEIVED, the undersigned, Electric City Corporation, an
Illinois corporation (the "Maker"), hereby unconditionally promises to pay to
the order of ▇▇▇▇▇▇ ▇▇▇▇▇▇(the "Holder"), at the office of Holder at
_______________________, Illinois _______, or at such other place as Holder may
from time to time designate to the Maker in writing, in lawful money of the
United States of America and in immediately available funds, the principal sum
of NINE HUNDRED SEVENTY-TWO THOUSAND AND NO/100 DOLLARS ($972,000). This
Subordinated Secured Term Note shall bear interest at the rate of ten percent
(10%) per annum on the unpaid principal amount hereof outstanding from time to
time, from the date hereof and shall be payable in equal monthly installments of
principle and interest in the amount of FORTY-FOUR THOUSAND, NINE HUNDRED TWENTY
SIX AND 56/100 DOLLARS ($44,927.56), with the first installment due and payable
on June 24, 2000, and the final installment due and payable on May 24, 2002, if
not sooner paid. Upon the occurrence and during the continuance of a default as
hereinafter described, the Maker shall pay interest on the outstanding principal
balance of this Subordinated Secured Term Note at the rate of fifteen percent
(15%) per annum. From and after the date when the principal balance hereof
becomes due and payable, whether by acceleration or otherwise, interest hereon
shall be payable on demand.
▇▇▇▇▇▇ acknowledges and agrees that this Subordinated Secured Term
Note and any right to payment hereunder and the security interests granted under
the General Security Agreement of even date herewith may be subordinated in
right only to the extent and in the manner provided below to the prior payment
and satisfaction in full of the Senior Indebtedness (as defined hereinafter).
The term "Senior Indebtedness" shall mean, including but not limited to, amounts
due to Maker's primary corporate lender ("Senior Lender") the principal and
interest on, and any and all other fees, expenses, reimbursement obligations and
other amounts due pursuant to the terms of all agreements, documents and
instruments providing for, creating, securing, or evidencing: (i) commercial or
institutional indebtedness of the Maker now existing or hereafter incurred or
created, or (ii) all deferrals, renewals, extensions, replacements, refinancing
or refundings of, and amendments, modifications, and supplements to, such
commercial or institutional indebtedness of the Maker. The Senior Lender shall
be one (1) commercial or institutional lender providing financing for the
Debtor. ▇▇▇▇▇▇ agrees to enter into a subordination agreement in form and
substance acceptable to the Senior Lender, subject to the terms hereof, upon
written request of the Maker. The term Senior Security Interests shall mean any
security interests granted by Maker in favor of the Senior Lender. Unless the
Maker has received notice from the Senior Lender of the occurrence and
continuation of an event of default under any Senior Indebtedness, the Maker may
pay, and the Holder may receive, regularly scheduled payments under this
Subordinated Secured Term Note as and when due in accordance with its terms.
Whenever any payment to be made hereunder shall be stated to be due on
a day which is not a business day, the due date thereof shall be extended to the
next succeeding business day and, with respect to the payments of principal,
interest shall be payable during such extension at the applicable rate in effect
immediately prior to such extension.
In no contingency or event whatsoever shall interest charged
hereunder, however such interest may be characterized or computed, 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 Holder has
received interest hereunder in excess of the highest rate applicable hereto,
such excess shall be applied to repayment of principal or refunded as Holder
shall decide.
All Obligations, and all rights, powers and remedies of the Holder,
expressed herein shall be in addition to, and not in limitation of, those
provided by law or in any written agreement or instrument (other than this
Subordinated Secured Term Note) relating to any of the Obligations.
Maker shall be in default hereunder if: (1) any amount payable on any
of the Obligations, or on the obligations of any obligor hereunder, is not paid
within five (5) business days after written notice from Holder that such amount
is past due; or (2) Maker shall otherwise fail to perform any of the material
promises to be performed by it hereunder or under any other security agreement
or other agreement with Holder and Maker has not cured such failure within
thirty (30) days after written notice thereof from Holder; or (3) Maker
dissolves and liquidates; or (4) Maker, or any other party liable with respect
to the Obligations, or any guarantor or accommodation endorser or third party
pledgor, shall make any assignment for the benefit of creditors, or there shall
be commenced any bankruptcy, receivership, insolvency, reorganization,
dissolution or liquidation proceedings by or against, or the entry of any
judgment in excess of $100,000, levy, attachment, garnishment or other process
against Maker or any guarantor, or any other party liable with respect to the
Obligations, or accommodation endorser or third party pledgor for any of the
Obligations or any collateral under a separate security agreement signed by any
one of them, unless released, satisfied, stayed or dismissed within thirty (30)
days of written notice from Holder; or (5) any oral or written warranty,
representation, certificate or statement of Maker to Holder is untrue and Maker
fails to cure the same within thirty (30) days of written notice from ▇▇▇▇▇▇.
Whenever Maker shall be in default as aforesaid, upon written demand
of Holder, the entire unpaid amount of all Obligations shall become immediately
due and payable; and Holder may exercise, from time to time, any and all rights
and remedies available to it under the Uniform Commercial Code of Illinois, or
otherwise available to it, including those available under any written
instrument (in addition to this Subordinated Secured Term Note) relating to any
of the Obligations or any security therefor.
Maker and any and all endorsers and accommodation parties, and each of
them, waive any and all presentment, demand, notice of dishonor, protest, and
all other notices and demands in connection with the enforcement of ▇▇▇▇▇▇'s
rights hereunder, except as otherwise provided herein. No Obligation shall be
waived by the Holder except in writing. No delay on the part of the Holder in
the exercise of any right or remedy shall operate as a waiver thereof, and no
single or partial exercise by the Holder of any right or remedy shall preclude
other or further exercise thereof, or the exercise of any other right or remedy.
Maker hereby represents that this Subordinated Secured Term Note (i) is valid,
binding and enforceable in accordance with its provisions, and no conditions
precedent exist to its legal effectiveness; (ii) contains the entire agreement
between Maker and Holder; and (iii) is the final expression of their intention.
No modification, discharge, termination or waiver or any of the provisions
hereof shall be binding upon the Holder, except as expressly set forth in
writing duly signed and delivered on behalf of the Holder.
This Subordinated Secured Term Note shall be governed and construed in
accordance with the laws of the State of Illinois, in which state it shall be
performed, and shall be binding upon Maker and its legal representatives,
successors and assigns. Wherever possible, each provision of this Subordinated
Secured Term Note shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Subordinated Secured
Term Note shall be prohibited by or be invalid under such law, such provision
shall be severable, and be ineffective to the extent of such prohibition or
invalidity, without invalidating the remaining provisions of this Subordinated
Secured Term Note.
IN WITNESS WHEREOF, ▇▇▇▇▇ has signed this Subordinated Secured Term
Note as of the above-referenced date.
ELECTRIC CITY CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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Title: Chief Financial Officer
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