EXHIBIT 10.19
-------------
PROMISSORY NOTE
---------------
$700,000.00 April 11, 2002
A. LOAN
For Value Received, HEALTH & NUTRITION SYSTEMS INTERNATIONAL, INC., a Florida
corporation (the "Borrower") unconditionally promises to pay to GARDEN STATE
NUTRITIONALS, a division of VITAQUEST INTERNATIONAL, INC., a Delaware
corporation (the "Lender"), at 0 Xxxxxxxxx Xxxxx, Xxxx Xxxxxxxx, Xxx Xxxxxx
00000, or at such other place as may be designated by the Lender, in lawful
money of the United States of America, the principal amount of SEVEN HUNDRED
THOUSAND AND 00/100 DOLLARS ($700,000.00) (the "Loan") payable in accordance
with the terms hereof.
B. RATE
The outstanding principal balance of the Loan shall not bear interest.
Notwithstanding any other provision contained in this Promissory Note, the
Lender does not intend to charge, and the Borrower shall not be required to pay,
any amount of interest or other fees or charges in connection with the Loan.
C. PAYMENTS
The principal amount of this Promissory Note shall be due and payable in equal
consecutive quarterly installments of EIGHTY SEVEN THOUSAND FIVE HUNDRED AND
00/100 DOLLARS ($87,500.00) commencing on June 1, 2002 and on the first Business
Day of each September, December, March and June thereafter until the Maturity
Date. All payments of principal shall be made by check or by wire transfer to an
account designated by Xxxxxx in writing.
D. MATURITY DATE
All unpaid principal shall be due on March 1, 2004.
E. ADDITIONAL TERMS AND CONDITIONS
1. This Promissory Note shall be construed under the internal laws and
judicial decisions of the State of Florida and the laws of the United States as
the same might be applicable, without regard to conflicts-of-laws principles
that would require the application of any other law.
2 Xxxxxxxx agrees to promptly pay, indemnify and hold Xxxxxx harmless
from any and all taxes (other than income taxes), if any, with respect to or
resulting from the execution and delivery of this Promissory Note.
3 The occurrence of any of the following events shall constitute a
default under this Promissory Note: (i) the failure of Borrower to pay when due
any payment of principal under this Promissory Note and such failure continues
for fifteen (15) days after Lender notifies Borrower thereof in writing; (ii)
if, pursuant to or within the meaning of the United States Bankruptcy Code or
any other federal or state law relating to insolvency or relief of debtors (a
"Bankruptcy Law"), Borrower shall (a) commence a voluntary case or proceeding;
(b) consent to the entry of an order for relief against it in an involuntary
case; (c) consent to the appointment of a trustee, receiver, assignee,
liquidator, or similar official; (d) make an assignment for the benefit of its
creditors; or (e) admit in writing its inability to pay its debts as they become
due and (iii) Xxxxxxxxxxx Xxxx shall cease to be and actively serve as the
President and Chief Executive Officer of Xxxxxxxx (unless a replacement
reasonably acceptable to Xxxxxx is obtained within thirty (30) days of Xx. Xxxx
ceasing to be President and Chief Executive Officer). "Business Day" shall mean
any day that banks are opened for business in the State of Florida, other than a
Saturday, Sunday or a legal holiday.
4 Whenever there is a default under this Promissory Note, Lender may, at
its option, (i) by written notice to Borrower, declare the entire unpaid
principal balance of this Promissory Note immediately due and payable; and (ii)
exercise any and all rights and remedies available to it under applicable law.
5 In the event any one or more of the provisions of this Promissory Note
shall for any reason be held to be invalid, illegal or unenforceable, in whole
or in part or in any respect, or in the event that any one or more of the
provisions of this Promissory Note operate or would prospectively operate to
invalidate this Promissory Note, then and in any of those events, such provision
or provisions only shall be deemed null and void and shall not affect any other
provision of this Promissory Note and the remaining provisions of this
Promissory Note shall remain operative and in full force and effect and shall in
no way be affected, prejudiced or disturbed thereby.
6 Borrower may prepay the outstanding principal balance due under this
Promissory Note, in full at any time or in part from time to time, without
premium or penalty. Any partial prepayments shall be applied to installments of
principal in inverse order of their maturity.
7 Any notice required or permitted to be given hereunder shall be given
to Borrower at 0000 Xxxxxxxxxx Xxxx, Xxxxx 0, Xxxx Xxxx Xxxxx, XX 00000,
Attention: President.
IN WITNESS WHEREOF, Xxxxxxxx has executed and delivered to Lender this
Promissory Note on the date first above written.
BORROWER:
HEALTH & NUTRITION SYSTEMS INTERNATIONAL, INC.,
A FLORIDA CORPORATION
/s/ Xxxxxxxxxxx Xxxx
------------------------------------------
By: Xxxxxxxxxxx Xxxx
Its: President and Chief Executive Officer
