Exhibit 2.8
THIS NOTE MAY NOT BE SOLD OR TRANSFERRED WITHOUT THE PRIOR WRITTEN CONSENT OF
THE MAKER OF THIS NOTE. THIS NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES, OR THE SECURITIES LAWS OF ANY OTHER JURISDICTION. THIS NOTE IS SUBJECT
TO A RIGHT OF OFFSET AS PROVIDED HEREIN.
THIS NOTE IS SUBORDINATED TO MAKER'S OBLIGATIONS TO IMPERIAL BANK PURSUANT TO
THE TERMS OF A SUBORDINATION AGREEMENT DATED THE DATE HEREOF BETWEEN PAYEE AND
IMPERIAL BANK.
8.5% Secured Subordinated Promissory Note
due September 14, 2000
$600,000.00 Yorba Linda, California
September 14, 1999
FOR VALUE RECEIVED, RESEARCH ENGINEERS, INC., a Delaware corporation
("Maker"), hereby promises to pay to the order of Xxxxxx Xxxxxxxx ("Payee"), at
such address as Payee shall from time to time designate in writing to Maker, the
principal sum of Six Hundred Thousand Dollars ($600,000.00), in lawful money of
the United States of America or such lesser principal amount as shall be
adjusted downward if Maker obtains a right to adjustment or offset in accordance
with Section 3 of this Note.
This Note is the Note referred to in the Restated Stock Purchase
Agreement among Maker and Payee dated September 14, 1999, as reformed ("Purchase
Agreement"). Defined terms used herein unless defined herein shall have the
meaning ascribed to them in the Purchase Agreement.
1. Principal and Interest Payments. The entire principal balance of this
Note, together with interest, which shall accrue at the rate of 8.5% per annum,
shall be payable on September 14, 2000.
2. Optional Prepayment. Maker may at any time prepay the whole or any
part of the unpaid principal balance of this Note, without penalty or premium,
but with interest accrued to the date fixed for prepayment. Notice of prepayment
shall be given by Maker by mail and shall be mailed to the holder of this Note
not less than five (5) days from the date fixed for prepayment. If this Note is
to be prepaid in part only, such Notice shall specify the amount to be prepaid,
and shall state that this Note shall be submitted to Maker for notation hereon
of the amount to be prepaid. Upon giving Notice of prepayment as aforesaid, this
Note or portion hereof so specified for prepayment shall on the prepayment date
specified in such notice become due and payable, and from and after the
prepayment date so specified (unless Maker defaults in making such prepayment)
interest on this Note or portion hereof so specified for prepayment shall cease
to accrue and, on presentation and surrender hereof to Maker for cancellation,
in the case of this Note being prepaid as a whole, or for notation hereof of the
payment of the portion of the principal amount hereof being prepaid in the case
of a prepayment of this Note in part only, this Note or portion hereof so
specified for prepayment shall be paid by Maker at the prepayment price
aforesaid. Any prepayment of this Note in part shall be applied to the
installments of principal payable hereunder in the order of maturity thereof.
3. Right of Offset. Maker shall have the right to offset against the
principal balance of this Note as provided in Section 7.3 of the Purchase
Agreement. Any such reduction in the principal balance of this Note shall be
applied against the principal hereunder with no interest being accrued on such
offset amount from the date of this Note. If such interest has been paid, the
amount of such interest so paid shall be credited to the principal balance
hereunder, with the principal being correspondingly reduced.
4. Attorney's Fees. Upon any event of default hereunder, Maker agrees to
pay to Payee all expenses incurred by Payee, including, without limitation,
reasonable fees and disbursements of counsel, incurred by Payee in the
enforcement and collection of this Note.
5. Default Interest Rate. If this Note is not paid in full when due, it
shall thereafter bear interest at the maximum rate then permitted by applicable
law from its due date until paid (the "Default Rate").
6. Security. This Note is secured by a Pledge Agreement of even date
herewith executed by Maker in favor of Payee.
7. Governing Law. This Note shall be governed by and construed
in accordance with the internal laws of the State of California.
8. Notices. All communications provided for hereunder shall be sent by
facsimile or by first class mail or with any private overnight courier, postage
prepaid, as follows:
If to Maker:
Research Engineers, Inc.
00000 Xxxx Xxxxx Xxxxxxx
Xxxxx Xxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attn.: Xxxxx Xxxxxxxxxx
with a copy to:
Xxxxx & Xxxxxx, LLP
000 Xxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attn: Xxxxx Xxxxx, Esq.
If to Payee:
Xxxxxx Xxxxxxxx
00 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxx Xxxx Xxxx & Friedenrich
0000 Xxxxxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attn: Xxxxx X. Xxxxxxx, Esq.
or to such other addresses as any party hereto shall specify to the others in
writing. Any such notice given by mail shall be effective three business days
after the date of mailing, and such notice given by telecopy, with confirmation
of receipt, or with a private carrier shall be effective on the date of
delivery.
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10. Successors and Assigns. This Note shall bind and inure to the benefit
of Maker's and Payee's successors and assigns.
11. Ambiguities. Each party and its counsel have participated fully in the
review and revisions of this Note. Any rule of construction to the effect that
ambiguities are to be resolved against the drafting party shall not apply in
interpreting this Note.
12. Exercise of Rights. No single or partial exercise of any power granted
to Payee under this Note shall preclude any other or further exercise thereof of
the existence of any other power. No delay or omission on the part of Payee in
exercising any right under this Note shall operate as a waiver of such right or
of any other right. The release of any party liable under this Note shall not
operate to release any other party liable hereunder.
IN WITNESS WHEREOF, Maker has duly executed this Note the day and year
first above written.
RESEARCH ENGINEERS, INC.,
a Delaware corporation
By:/s/ Xxxxx Xxxxxxxxxx
------------------------------
Xxxxx Xxxxxxxxxx, President
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