REVOLVING CREDIT NOTE
Exhibit 10.2
1. Amount,
Obligation to Pay, Interest Rate. FOR VALUE RECEIVED, in such
installments and at the times hereinafter stated, VERECLOUD, INC., a Nevada
corporation (hereinafter "Borrower", whether one or more), whose address is 0000
X. Xxxxxxxxx Xxxxx Xxxx., Xxxxx 000, Xxxxxxxxx, Xxxxxxxx 00000, jointly and
severally if more than one, promises to pay to the order of TMG HOLDINGS
COLORADO, LLC, a Texas limited liability company ("Lender"), whose address is
0000 X. Xxxx, Xxxxx 000, Xxxx xx Xx Xxxx, Xx Xxxx Xxxxxx, Xxxxx 00000, in
immediately available funds constituting legal tender of the United States of
America, the principal sum of ONE MILLION FIVE HUNDRED SIXTY-FOUR THOUSAND AND
NO/100THS DOLLARS ($1,564,000.00) (the "Maximum Note Amount"), or so
much thereof as shall be advanced hereunder, with interest on the unpaid
principal balance from time to time outstanding, interest to accrue from the
date of each disbursement made hereunder as follows:
The rate
of interest hereunder, prior to default by Maker or maturity of this Note, shall
be ten percent (10%) per annum. From and after any default by Maker in the
payment of this Note or maturity of this Note, the rate of interest hereunder
shall be as provided in Section 7 of this Note.
2. Terms. Payments of principal and
interest under this Revolving Credit Note ("Note") shall be made as
follows:
Accrued
interest only as provided herein on the outstanding principal balance shall be
due and payable quarterly; the first of such interest payments shall be due and
payable on June 30, 2011, and interest payments shall be due and payable
thereafter on the last day of every calendar quarter, (September 30, December
31, March 31, and June 30) during the term of the Note. The entire balance of
unpaid principal and accrued, unpaid interest as provided herein shall be due
and payable on June 30, 2012.
The
unpaid principal balance of this Note at any time will be the total amounts
advanced by Lender, less the amount of all payments or prepayments of principal.
Absent manifest error, the records of Xxxxxx will be conclusive as to amounts
owed. Subject to the terms and conditions of this Note and the Security
Documents (as defined below), Borrower may use all or any part of the credit
provided for herein at any time before the maturity of this Note and may borrow,
repay and reborrow. No limitation exists with respect to the number of advances
made under this Note so long as the total unpaid principal amount at any time
outstanding does not exceed the Maximum Note Amount.
3. Security. This Note is secured by all
instruments heretofore, now or hereafter executed by Borrower or any guarantors
in favor of Xxxxxx and by their terms securing the payment of this Note
(hereinafter "Security
Documents") including without limitation, the
following:
A. A Loan
Agreement of even date herewith between Lender and Borrower ("Loan
Agreement').
B. A
Security Agreement of even date herewith from Borrower, as Debtor, to Lender, as
Secured Party, in which Borrower grants to Lender a security interest in the
collateral more fully described therein (the "Collateral").
C. One or
more UCC Financing Statements perfecting the security interest granted by
Xxxxxxxx, as Debtor, to Lender, as Secured Party, in the
Collateral.
4. Manner
and Place of Payment; Holidays. All payments on this Note
shall be made in coin or currency which, at the time or times of payment, are
immediately available funds constituting legal tender for public or private
debts in the United States of America. All payments on this Note shall be made
at the address of Lender as indicated in the first paragraph hereinabove, or at
such other address as Lender shall designate in writing. If the prescribed date
of payment of any of the principal of or interest hereon is a Sunday or legal
holiday, such payment shall be due on the next succeeding business
day.
5. Application
of Payments; Prepayment. All sums paid hereon shall
be applied first to the payment of accrued interest due on the unpaid principal
balance, and the remainder to the reduction of unpaid principal. Xxxxxxxx may
prepay this Note at any time without penalty. Any prepayment is to be applied
toward the payment of the principal installments last maturing upon this Note,
that is, in the inverse order of maturity and without reducing the amount or
time of payment of the remaining obligatory installments.
6. Default
and Acceleration.
Time is of the essence of this Note, and time is of the essence in the
performance of all obligations under the Security Documents. Upon the occurrence
of an "Event of Default", as defined in the Loan Agreement, Lender may, then or
at any time thereafter, without further notice and at its option, accelerate
maturity and cause all of the unpaid principal balance of this Note, with
interest, fees and charges accrued hereon, and all obligations in all
instruments securing or collateral to it, to become immediately due and payable.
If Lender waives Xxxxxx's right to accelerate maturity as a result of a default
hereunder, either one or more times or repeatedly, nevertheless Lender shall not
be deemed to have waived the right to require strict compliance with the terms
of this Note thereafter.
7. Annual
Interest Rate Upon Default. All past due installments of
principal and interest due and owing on this Note, shall bear interest from
maturity thereof until paid at the lesser of (i) eighteen percent (18.00%) per
annum or (ii) the Maximum Rate as defined herein. Upon acceleration or maturity
of the entire outstanding principal balance of this Note, the said principal
amount shall bear interest from the date of acceleration or maturity until paid
at the rate of eighteen percent (18%) per annum calculated and applied on the
basis of actual days elapsed and a 365/366 day year, subject to Section 8
hereof, PROVIDED, this Section shall in no way exceed the Maximum Rate as
defined herein.
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8. Savings
and Spreading. It
is expressly stipulated and agreed to be the intent of Borrower and Lender at
all times to comply with applicable Colorado law governing the maximum rate or
amount of interest payable on or in connection with this Note and the loan
evidenced hereby (the "Loan") (or applicable United States federal law to the
extent that it permits Lender to contract for, charge, take, reserve or receive
a greater amount of interest than under Colorado law). If the applicable law is
ever judicially interpreted so as to render usurious any amount called for under
this Note or under the Security Documents, or contracted for, charged, taken,
reserved or received with respect to the Loan, or if acceleration of the
maturity of this Note or if any prepayment by Borrower results in Borrower
having paid any interest in excess of that permitted by law, then it is Borrower's
and Xxxxxx's express intent that: (i) all excess amounts theretofore collected
by Lender be credited on the principal balance of this Note (or, if this Note
has been or would thereby be paid in full, refunded to Borrower); and (ii) the
provisions of this Note and the Security Documents immediately be deemed
reformed and the amounts thereafter collectible hereunder and thereunder
reduced, without the necessity of the execution of any new document, so as to
comply with the applicable law, but so as to permit the recovery of the fullest
amount otherwise called for hereunder and thereunder. The right to accelerate
maturity of this Note does not include the right to accelerate any interest
which has not otherwise accrued on the date of such acceleration, and Lender
does not intend to collect any unearned interest in the event of acceleration.
All sums paid or agreed to be paid to Lender for the use, forbearance or
detention of the indebtedness evidenced hereby shall, to the extent permitted by
applicable law, be amortized, prorated, allocated and spread throughout the full
term of such indebtedness until payment in full so that the rate or amount of
interest on account of such indebtedness does not exceed the applicable usury
ceiling. Notwithstanding any provision contained in this Note or in any of the
Security Documents that permits the compounding of interest, including without
limitation any provision by which any of the accrued interest is added to the
principal amount of this Note, the total amount of interest that Borrower is
obligated to pay and Lender is entitled to receive with respect to this Note
shall not exceed the amount calculated on a simple (ie., noncompounded) interest
basis at the Maximum Rate (as defined hereinafter) on principal amounts actually
advanced to or for the account of Borrower, including any initial funds advanced
contemporaneously herewith and any advances made pursuant to any of the Security
Documents (such as for the payment of taxes, insurance premiums and the like).
As used herein, the term "Maximum Rate" shall mean the maximum nonusurious rate
of interest which may be lawfully contracted for, charged, taken, reserved or
received by Lender from Borrower in connection with the Loan evidenced hereby
under applicable Colorado law (or applicable United States federal law to the
extent that it permits Lender to contract for, charge, take, reserve or receive
a greater amount of interest than under Colorado law). As used herein, the term
"Maximum Rate" shall mean the maximum nonusurious rate of interest which may be
lawfully contracted for, charged, taken, reserved or received by Lender from
Borrower in connection with the loan evidenced hereby under applicable Colorado
law (or applicable United States federal law to the extent that it permits
Lender to contract for, charge, take, reserve or receive a greater amount of
interest than permitted under Colorado law). The Borrower agrees that if such
excess payments are applied in the manner provided for in this paragraph, then
to the fullest extent permitted by applicable law, the Lender shall not be
subject to any penalty provided for by any applicable law relating to charging
or collecting interest in excess of that permitted by applicable
law.
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9. Attorney's
Fees and Expenses. In the event that Lender or
any other holder of this Note brings suit hereon, or employs an attorney or
incurs expenses to compel payment of this Note or any portion of the
indebtedness evidenced hereby, or to cure any defaults under this Note or any of
the Security Documents, whether through suit, probate, insolvency,
reorganization, bankruptcy, or any other legal or informal proceeding, Borrower
and all endorsers, guarantors and sureties agree additionally to pay all
reasonable attorney's fees, court costs and other reasonable expenses thereby
incurred by Xxxxxx.
10. Waiver. Except as otherwise provided
in this Note, Borrower and all endorsers, guarantors, sureties and accommodation
parties of this Note, both before and after maturity, hereby expressly: (i)
waive all protest, notice of protest, demand for payment, presentment for
payment, notice of intention to accelerate maturity, notice of acceleration of
maturity, notice of dishonor, bringing of suit, and diligence in taking any
action to collect any amounts called for hereunder and in the handling of
properties, rights or collateral at any time existing in connection herewith;
(ii) consent to and waive notice of any one or more renewals, extensions or
modifications of this Note, whether made to or in favor of Borrower or any other
person or persons, regardless whether any such renewal, extension or
modification modifies the terms, interest rate or time for payment of this Note
and regardless of the length of term of the renewal, extension or modification;
(iii) consent to and waive notice of any substitution, exchange or release of
any security now or hereafter given for this Note; (iv) consent to and waive
notice of the release of any party primarily or secondarily liable hereon; (v)
consent to and waive notice of any other indulgences, none of which shall
otherwise affect the liability of any of said parties for the indebtedness
evidenced by this Note; and (vi) agree that it will not be necessary for Lender,
in order to enforce payment of this Note, first to institute suit against or to
exhaust Xxxxxx's remedies against Borrower or any other party liable hereunder,
or to proceed against any other security for this Note.
11. Definitions;
Applicable Law.
The terms "Borrower" and "Lender" and other nouns and pronouns include the
singular and/or plural, as appropriate. The terms "Borrower" and "Lender" also
include their respective successors and assigns. THIS NOTE SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF COLORADO EXCEPT WHERE
PREEMPTED BY FEDERAL LAW OF THE UNITED STATES OF AMERICA.
12. Purpose. Borrower warrants and
represents to Lender that each loan, whether one or more, evidenced by this
Note, is and shall be for business, commercial, investment or other similar
purpose and not primarily for personal, family, household or agricultural
use.
13. Payment
of Note and Discharge of Indebtedness. Upon
satisfaction of all obligations due from Borrower to Lender under this Note, the
Loan Agreement and all other Security Instruments, and upon written notification
from Borrower to Lender that Borrower has terminated its right to request
further advances hereunder, Borrower shall have the right to terminate the Loan
Agreement, the Note, and the Security Agreement and receive from Lender a
release of any and all liens and security interests held by Xxxxxx and securing
the repayment of this Note.
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NOTICE
THE
NOTE AND THE SECURITY DOCUMENTS EXECUTED IN CONNECTION XXXXXXXXX CONSTITUTE THE
WRITTEN LOAN AGREEMENT AND REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES.
THERE
ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
IN WITNESS WHEREOF, Xxxxxxxx
has executed this Note as of the date first set forth above.
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BORROWER:
a
Nevada corporation
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By:
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/s/ Xxxx Xxxxxxx | |
| Name: | Xxxx Xxxxxxx | ||
| Its: | Chief Operating Officer | ||
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