PROMISSORY NOTE AND FOREBEARANCE AGREEMENT
Exhibit
10.1
PROMISSORY
NOTE AND FOREBEARANCE AGREEMENT
FOR
VALUE
RECEIVED, the undersigned promises to pay to Xxxxxxx X. Xxxxxxxx (hereinafter
“Xxxxxxxx”), the principal sum of Sixteen Thousand Three Hundred Dollars
($16,300.00) with interest from the date hereof at the rate hereinafter set
forth on the unpaid principal balance until paid or until default, both
principal and interest payable in lawful money of the United States at address
on file for Xxxxxxxx, or at such other place as the legal holder hereof may
designate in writing, as follows:
Interest
at the rate of Eight Percent (8%)
shall
accrue per annum. The principal shall be due and payable on demand, the
foregoing notwithstanding, the principal shall be paid in full no later than
one
(1) year from the date of this Promissory Note and Forbearance Agreement. The
accrued interest shall be due and payable yearly on the anniversary dates of
this Promissory Note and Forbearance Agreement.
In
addition, Xxxxxxxx has previously executed a Personal Guarantee in favor of
Wachovia Bank, N.A. (herein after Wachovia) with regard to indebtedness owed
by
the undersigned to Wachovia. Wachovia contends that the Guarantee
obligates Xxxxxxxx up to an amount of $6,625,000. Xxxxxxxx contends that
the amount of the Guarantee should be no more than one half of a total debt
of
eight million dollars. At the inducement of the undersigned, Xxxxxxxx
agrees that he will not contest the claim by Wachovia that he has guaranteed
$6,000,000 (he reserves the right to contest that he guaranteed
$6,625,000). In exchange for Xxxxxxxx’x agreement to not contest the
amount of the Guaranty up to $6,000,000, the undersigned agrees that it shall
be
obligated to Xxxxxxxx, upon demand, for any amounts above $4,000,000 he has
to
pay to Wachovia under the Personal Guaranty. The undersigned further agrees
to reimburse Xxxxxxxx for any additional fees to Wachovia Bank, N.A. occurring
from this transaction. A failure to honor said demand shall constitute an event
of default under the terms of the Security Agreement and a Collateral Assignment
Agreement of even date herewith.
This
Promissory Note and Forbearance Agreement may be prepaid, in whole or in part,
at any time without penalty.
This
Promissory Note and Forbearance Agreement is secured by a Security Agreement
and
a Collateral Assignment Agreement of even date herewith.
In
the
event of (a) default in the payment of any installment of principal or interest
hereof as the same becomes due and such default is not cured within ten (10)
days after written notice to maker, or (b) if a petition in bankruptcy shall
be
filed by or against the maker, or any endorser or guarantor of this Promissory
Note and Forbearance Agreement, which petition is not dismissed within thirty
(30) days, or (c) if the maker shall become insolvent, or (d) if a receiver
is
appointed for the benefit of the creditors of the maker or any endorser or
guarantor, or (e) if a corporate maker shall dissolve or terminate its
existence, then and in any such event, each of which is deemed an event of
default, the holder may, without notice, declare the remainder of the principal
sum, together with all interest accrued thereon at once due and payable. Failure
to exercise this option shall not constitute a waiver of the right to exercise
the same upon any subsequent event of default. The unpaid principal of this
Promissory Note and Forbearance Agreement and any part thereof, accrued
interest, and all other sums due under this Promissory Note and Forbearance
Agreement, shall bear interest at a rate of Eight Percent (8%) per annum after
default until paid.
All
persons bound on this obligation, whether primarily or secondarily liable as
principals, sureties, guarantors, endorsers, or otherwise, hereby waive
presentment, protest, notice of dishonor and acceleration of maturity, and
any
right to require the owner and holder of this Promissory Note and Forbearance
Agreement or any other liabilities, and agree that any extension of time for
payment with or without notice shall not affect their joint and several
liabilities.
Upon
default, the holder of this Promissory Note and Forbearance Agreement may employ
an attorney to enforce the holder's rights and remedies and the maker,
principal, surety, guarantor, and endorsers of this Promissory Note and
Forbearance Agreement hereby agree to pay to the holder reasonable attorneys'
fees not exceeding a sum equal to Eight Percent (8%) of the outstanding balance
owing on said Promissory Note and Forbearance Agreement, plus all other
reasonable expenses incurred by the holder in exercising any of the holder's
rights and remedies upon default. The rights and remedies of the holder as
provided in this Promissory Note and Forbearance Agreement and any instrument
securing this Promissory Note and Forbearance Agreement shall be cumulative
and
may be pursued singly, successively, or together against any property or
security held by the holder for payment or security in the sole discretion
of
the holder. The failure to exercise any such right or remedy shall not be a
waiver or release of such rights or remedies or the right to exercise any of
them at another time.
This
Promissory Note and Forbearance Agreement shall be governed by and construed
in
accordance with the laws of the State of North Carolina.
IN
WITNESS WHEREOF, the undersigned has affirmed this debt all effective as of
this
date and has caused this Promissory Note and Forbearance Agreement to be
executed in its name by its Chief Financial Officer, all by order of its Board
of Directors first duly given, this the 23rd
day of
January, 2008.
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BY:
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/s/ Xxxxxxx X. von Gnechten
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Xxxxxxx
X. von Gnechten, Chief Financial Officer
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