SECOND REPLACEMENT REVOLVING LOAN NOTE
$63,335,000.00 September 2, 1998
FOR VALUE RECEIVED AND INTENDING TO BE LEGALLY BOUND HEREBY, the undersigned,
Piercing Pagoda, Inc. ("PPI"), a Delaware corporation and Piercing Pagoda of
Florida, Inc. ("PPF"), a Florida corporation (jointly and severally referred to
and obligated as "Borrower"), promise to pay to the order of First Union
National Bank ("Lender"), at the offices of Lender, in its capacity as
Administrative Agent under the Loan Agreement (as hereinafter defined) (acting
in such capacity, the "Administrative Agent") at 000 Xxxxx Xxxxx Xxxxxx,
Xxxxxxxxxxxx, Xxxxxxxxxxxx, or at such other location as Administrative Agent
may designate from time to time, with interest as set forth below, the principal
sum of Sixty-Three Million Three Hundred Thirty-Five Thousand ($63,335,000.00)
Dollars or such lesser sum which represents Xxxxxx's Pro Rata Share of the
principal balance outstanding under the Revolving Loan established pursuant to
the provisions of that certain Syndicated Loan Agreement dated March 27, 1997
among PPI, Administrative Agent, Lender and the other "Lenders" listed therein,
as amended pursuant to the provisions of that certain First Amendment to
Syndicated Loan Agreement dated November 21, 1997 among such parties and that
certain Second Amendment to Syndicated Loan Agreement of even date herewith
among such parties and PPF (as it may be supplemented, restated, superseded,
further amended or replaced from time to time, "Loan Agreement"). Except as
otherwise provided below, the outstanding principal balance hereunder shall,
absent earlier acceleration, be payable on the Revolving Loan Termination Date.
The actual amount due and owing from time to time hereunder shall be evidenced
by Administrative Agent's records of receipts and disbursements with respect to
the Revolving Loan, which shall be prima facie evidence of the amount. All
capitalized terms used herein without further definition shall have the
respective meanings ascribed thereto in the Loan Agreement.
Xxxxxxxx further agrees to pay interest on the outstanding principal
balance hereunder from time to time at one or more of the per annum Rates set
forth in Paragraph 2.8 of the Loan Agreement. Interest shall be calculated on
the basis of a year of 360 days for the actual number of days elapsed, and shall
be due and payable as set forth in the Loan Agreement.
The Revolving Loan shall continue to accrue interest at the applicable
Rates provided for in the Loan Agreement even after Default, an Event of
Default, maturity, acceleration, judgment, bankruptcy, insolvency proceedings of
any kind or the happening of any other event or occurrence, whether similar or
dissimilar.
On or before October 31, 1998, Borrower shall repay to Lender the
Temporary Commitment Increase, or so much thereof as shall have been advanced by
Lender, together with all accrued and unpaid interest.
If an Event of Default occurs and is continuing under the Loan Agreement,
the unpaid principal balance of this Second Replacement Revolving Loan Note,
together with all accrued and unpaid interest and other outstanding Obligations
shall become, or may be declared, immediately due and payable as provided in the
Loan Agreement.
This Second Replacement Revolving Loan Note may be prepaid only in
accordance with the terms and conditions of the Loan Agreement.
Any failure or delay of Administrative Agent, any Agent or Lender to
exercise any right hereunder shall not be construed as a waiver of the right to
exercise the same or any other right at any other time or times. The waiver by
Administrative Agent, any Agent or Lender of a breach or default of any
provision of this Second Replacement Revolving Loan Note shall not operate or be
construed as a waiver of any subsequent breach or default hereof. Xxxxxxxx
agrees to reimburse Administrative Agent for all expenses incurred by
Administrative Agent, Lender or any other lender in accordance with the
provisions of the Loan Agreement.
This Second Replacement Revolving Loan Note shall be construed and
governed by the laws of the Commonwealth of Pennsylvania without regard to
otherwise applicable principles of conflicts of laws. The provisions of this
Second Replacement Revolving Loan Note are severable and the invalidity or
unenforceability of any provision shall not alter or impair the remaining
provisions of this Second Replacement Revolving Loan Note. No modification
hereof shall be binding or enforceable against Lender unless approved in writing
by Xxxxxx.
THE FOLLOWING SETS FORTH A WARRANT OF AUTHORITY FOR ANY ATTORNEY TO, AFTER THE
OCCURRENCE AND DURING THE CONTINUANCE OF AN EVENT OF DEFAULT, CONFESS JUDGMENT
AGAINST BORROWER. IN GRANTING THIS WARRANT OF ATTORNEY TO CONFESS JUDGMENT
AGAINST XXXXXXXX, BORROWER, FOLLOWING CONSULTATION WITH (OR DECISION NOT TO
CONSULT WITH) SEPARATE COUNSEL FOR XXXXXXXX, AND WITH KNOWLEDGE OF THE LEGAL
EFFECT HEREOF, XXXXXX XXXXXX ANY AND ALL RIGHTS BORROWER HAS, OR MAY HAVE, TO
PRIOR NOTICE AND AN OPPORTUNITY FOR HEARING BEFORE ENTRY OF JUDGMENT, OR
EXECUTION UPON ANY REAL OR PERSONAL PROPERTY OF XXXXXXXX UNDER THE CONSTITUTIONS
AND LAWS OF THE UNITED STATES AND THE COMMONWEALTH OF PENNSYLVANIA. XXXXXXXX
SPECIFICALLY ACKNOWLEDGES THAT ADMINISTRATIVE AGENT AND XXXXXXX HAVE RELIED ON
THIS WARRANT OF ATTORNEY IN GRANTING THE FINANCIAL ACCOMMODATIONS DESCRIBED
HEREIN.
AFTER THE OCCURRENCE AND DURING THE CONTINUANCE OF AN EVENT OF DEFAULT, BORROWER
HEREBY EMPOWERS ANY PROTHONOTARY, CLERK, OR ATTORNEY OF ANY COURT OF RECORD IN
THE UNITED STATES, OR ELSEWHERE, TO APPEAR FOR BORROWER IN ANY AND ALL ACTIONS
WHICH MAY BE BROUGHT HEREUNDER IN THE COMMONWEALTH OF PENNSYLVANIA OR ELSEWHERE
AND CONFESS JUDGMENT AGAINST BORROWER FOR ALL, OR ANY PART, OF THE UNPAID
PRINCIPAL BALANCE HEREUNDER, AND ACCRUED INTEREST TOGETHER WITH OTHER EXPENSES
INCURRED IN CONNECTION THEREWITH AND ATTORNEYS' FEES OF FIVE PERCENT (5%) OF THE
TOTAL OF THE FOREGOING SUMS, BUT IN NO EVENT LESS THAN FIVE THOUSAND ($5,000.00)
DOLLARS, AND FOR SUCH PURPOSE, THE ORIGINAL OR ANY PHOTOCOPY OF THIS REPLACEMENT
REVOLVING LOAN NOTE SHALL BE A GOOD AND SUFFICIENT WARRANT OF ATTORNEY. SUCH
AUTHORITY SHALL NOT BE EXHAUSTED BY ONE EXERCISE THEREOF BUT JUDGEMENT MAY BE
CONFESSED AS AFORESAID FROM TIME TO TIME. BORROWER WAIVES ALL ERRORS AND RIGHTS
OF APPEAL, AS WELL AS RIGHTS TO STAY OF EXECUTION AND EXEMPTION OF PROPERTY, IN
ANY ACTION TO ENFORCE ITS LIABILITY HEREON.
Except as expressly set forth in the Loan Agreement, Borrower hereby
waives protest, notice of protest, presentment, dishonor, notice of dishonor and
demand. To the extent permitted by law, Borrower hereby waives and releases all
errors, defects and imperfections in any proceedings instituted by
Administrative Agent or any Lender under the terms of this Second Replacement
Revolving Loan Note. The rights and privileges of Administrative Agent and any
Lender under this Second Replacement Revolving Loan Note shall inure to the
benefit of its successors and assigns. All representations, warranties and
agreements of Borrower made in connection with this Second Replacement Revolving
Loan Note shall bind Xxxxxxxx's successors and assigns. The rights and remedies
of Administrative Agent or Lender under this Second Replacement Revolving Loan
Note shall be in addition to any other rights and remedies available to
Administrative Agent or Lender at law or in equity, all of which may be
exercised singly or concurrently. The parties agree to the exclusive
jurisdiction of the federal and state courts located in Pennsylvania in
connection with any matter arising hereunder, including the collection and
enforcement hereof, except as the Administrative Agent may otherwise elect.
Xxxxxxxx (and Administrative Agent and Lender by their acceptance hereof)
each hereby waives any and all rights it may have to a jury trial in connection
with respect to rights any litigation arising with rights and obligations of the
parties hereto.
This Second Replacement Revolving Loan Note replaces and supersedes, but
does not extinguish or constitute a novation of any of the indebtedness
evidenced by a certain Replacement Revolving Loan Note dated November 21, 1997.
In the principal amount of Sixteen Million ($16,000,000.00) Dollars executed and
delivered by PPI to Lender and a certain Replacement Revolving Loan Note dated
November 21, 1997 in the principal amount of Thirty-Seven Million Three Hundred
Thirty-Five Thousand ($37,335,000.00) Dollars executed and delivered by PPI to
CoreStates Bank, N.A., Xxxxxx's predecessor-in-interest.
IN WITNESS WHEREOF, intending to be legally bound, Xxxxxxxx has duly
executed this Second Replacement Revolving Loan Note the day and year first
above written and has hereunto set hand and seal.
ATTEST: PIERCING PAGODA, INC.
By:____________________________
By:____________________________
Name: Name:
Title: Title:
(Corporate Seal)
ATTEST: PIERCING PAGODA of FLORIDA, INC.
By: __________________________
By:________________________________
Name: Name:
Title: Title:
(Corporate Seal)
PHIL1\144695-1
