TERM NOTE
$960,000.00
As of December 19, 2001
FOR VALUE RECEIVED, the undersigned, DRYCLEAN USA, INC., a Delaware
corporation (the "Borrower"), promises to pay to the order of FIRST UNION
NATIONAL BANK, a national banking association (the "Lender"), and its successors
and assigns, the principal sum of Nine Hundred and Sixty Thousand and 00\100
Dollars ($960,000.00), which sum was advanced by the Lender to the Borrower
pursuant to, and in accordance with the terms of, the Loan Agreement (as
hereinafter defined), the provisions of which are incorporated herein by
reference.
All principal shall be paid on such date and in such amounts as
provided in the Loan Agreement. Both principal and interest hereunder are
payable in lawful money of the United States to the Lender at its office as
Lender shall designate from time to time. The Borrower also unconditionally
promises to pay interest on the unpaid principal amount of this Note for each
day from the date hereof until repaid in full as provided in the Loan Agreement.
Interest shall be payable at the rate or rates per annum set forth in the Loan
Agreement.
Notwithstanding anything herein to the contrary, if at any time the
interest rate applicable to the Term Loan, together with all fees, charges and
other amounts which are treated as interest on the Term Loan under applicable
law (collectively the "Charges"), shall exceed the maximum lawful rate (the
"Maximum Rate") which may be contracted for, charged, taken, received or
reserved by the Lender in accordance with applicable law, the rate of interest
payable in respect of the Term Loan, together with all Charges payable in
respect thereof, shall be limited to the Maximum Rate and, to the extent lawful,
the interest and Charges that would have been payable in respect of the Term
Loan but were not payable as a result of the operation of these provisions shall
be cumulated and the interest and Charges payable to the Lender in respect of
other Indebtedness or periods shall be increased (but not above the Maximum Rate
therefor) until such cumulated amount, together with interest thereon at the
Adjusted LIBOR Market Index Rate(Term) to the date of repayment, shall have been
received by the Lender.
For the purposes of this Note:
"Loan Agreement" shall mean the Loan and Security Agreement, dated as
of the date hereof, by and between the Borrower and the Lender, as the same may
be hereafter amended, supplemented, extended, modified, amended or restated from
time to time.
"Term Loan" shall mean the Term Loan made by the Lender pursuant to the
Loan Agreement.
All other capitalized terms used in this Note without definition shall
have the meanings ascribed to such terms in the Loan Agreement.
The Borrower, for itself and its successors and assigns, expressly
waives presentment for payment, demand, protest and notice of demand, notice of
dishonor and notice of nonpayment and all other notices and consents that the
Lender may release or surrender, exchange or substitute any collateral security
now held or which may hereafter be held as security for the payment of this
Note.
This Note is the Term Note and evidences the Term Loan and is secured
in accordance with the terms of, and is entitled to the benefits of, the Loan
Agreement, including those terms related to
the acceleration of the maturity of this Note upon the occurrence of an Event of
Default. Payment of this Note is secured by the Collateral as described in the
Loan Agreement.
In the event that this Note shall at any time after maturity be placed
with an attorney for collection, the Borrower agrees to pay, in addition to the
entire unpaid principal balance and interest due hereunder, all collection
costs, including reasonable attorneys' fees, incurred by the Lender in
collecting the indebtedness due hereunder.
Upon demand of any party hereto, whether made before or after
institution of any judicial proceeding, any dispute, claim or controversy
arising out of, connected with or relating to this Note and any other Loan
Document ("Disputes") between or among parties to this Note shall be resolved by
binding arbitration as provided herein. Institution of a judicial proceeding by
a party does not waive the right of that party to demand arbitration hereunder.
Disputes may include, without limitation, tort claims, counterclaims, disputes
as to whether a matter is subject to arbitration, claims brought as class
actions, claims arising from Loan Documents executed in the future, or claims
arising out of or connected with the transaction reflected by this Note.
Arbitration shall be conducted under and governed by the Commercial Financial
Disputes Arbitration Rules (the "Arbitration Rules") of the American Arbitration
Association (the "AAA") and Title 9 of the U.S. Code. All arbitration hearings
shall be conducted in the city in which the office of Lender first stated above
is located. The expedited procedures set forth in Rule 51 et seq. of the
Arbitration Rules shall be applicable to claims of less than $1,000,000. All
applicable statutes of limitations shall apply to any Disputes. A judgment upon
the award may be entered in any court having jurisdiction. The panel from which
all arbitrators are selected shall be comprised of licensed attorneys. The
single arbitrator selected for expedited procedure shall be a retired judge from
the highest court of general jurisdiction, state or federal, of the state where
the hearing will be conducted or if such person is not available to serve, the
single arbitrator may be a licensed attorney. Notwithstanding the foregoing,
this arbitration provision does not apply to disputes under or related to swap
agreements. Notwithstanding the preceding binding arbitration provisions, Lender
and Borrower agree to preserve, without diminution, certain remedies that any
party herein may employ or exercise freely, independently or in connection with
an arbitration proceeding or after an arbitration action is brought. Xxxxxx and
Borrower shall have the right to proceed in any court of proper jurisdiction or
by self-help to exercise or prosecute the following remedies, as applicable: (i)
all rights to foreclose against any real or personal property or other security
by exercising a power of sale granted under Loan Documents or under applicable
law or by judicial foreclosure and sale, including a proceeding to confirm the
sale; (ii) all rights of self-help including peaceful occupation of real
property and collection of rents, set-off, and peaceful possession of personal
property; (iii) obtaining provisional or ancillary remedies including injunctive
relief, sequestration, garnishment, attachment, appointment of receiver and
filing an involuntary bankruptcy proceeding; and (iv) when applicable, a
judgment by confession of judgment. Preservation of these remedies does not
limit the power of an arbitrator to grant similar remedies that may be requested
by a party in a Dispute. Xxxxxx and Xxxxxxxx agree that they shall not have a
remedy of punitive or exemplary damages against the other in any Dispute and
hereby waive any right or claim to punitive or exemplary damages they have now
or which may arise in the future in connection with any Dispute whether the
Dispute is resolved by arbitration or judicially.
SUBJECT TO THE TERMS OF THE IMMEDIATELY PRECEDING PARAGRAPH, THIS NOTE
SHALL BE INTERPRETED, AND THE RIGHTS AND LIABILITIES OF THE PARTIES HERETO
DETERMINED, IN ACCORDANCE WITH THE INTERNAL LAWS (AS OPPOSED TO CONFLICTS OF LAW
PROVISIONS) OF THE STATE OF FLORIDA. SUBJECT TO THE TERMS OF THE IMMEDIATELY
PRECEDING PARAGRAPH, AS PART OF THE CONSIDERATION FOR NEW VALUE THIS DAY
RECEIVED, THE BORROWER HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR
FEDERAL COURT LOCATED WITHIN MIAMI-DADE COUNTY, STATE OF FLORIDA, AND CONSENTS
THAT ALL SERVICE OF PROCESS BE MADE BY REGISTERED OR CERTIFIED MAIL DIRECTED TO
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THE BORROWER AT THE ADDRESS STATED IN SECTION 9.4 OF THE LOAN AGREEMENT AND
SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED UPON THE EARLIER OF ACTUAL
RECEIPT THEREOF OR THREE DAYS AFTER DEPOSIT IN THE UNITED STATES MAILS, PROPER
POSTAGE PREPAID. SUBJECT TO THE TERMS OF THE IMMEDIATELY PRECEDING PARAGRAPH,
EACH OF THE BORROWER AND THE LENDER HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES TRIAL BY JURY IN ANY SUIT OR PROCEEDING ARISING OUT OF OR RELATED TO THIS
NOTE OR THE OTHER LOAN DOCUMENTS. SUBJECT TO THE TERMS OF THE IMMEDIATELY
PRECEDING PARAGRAPH, THE BORROWER WAIVES ANY OBJECTION WHICH THE BORROWER MAY
HAVE BASED ON LACK OF JURISDICTION OR IMPROPER VENUE OR FORUM NON CONVENIENS TO
ANY SUIT OR PROCEEDING INSTITUTED BY THE LENDER UNDER THIS NOTE OR THE OTHER
LOAN DOCUMENTS IN ANY STATE OR FEDERAL COURT LOCATED WITHIN MIAMI-DADE COUNTY,
FLORIDA AND CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS
DEEMED APPROPRIATE BY THE COURT. SUBJECT TO THE TERMS OF THE IMMEDIATELY
PRECEDING PARAGRAPH, NOTHING IN THIS PARAGRAPH SHALL AFFECT THE RIGHT OF THE
LENDER TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT THE
RIGHT OF THE LENDER TO BRING ANY ACTION OR PROCEEDING AGAINST THE BORROWER OR
ITS PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION WHICH HAS JURISDICTION OVER
THE BORROWER OR ITS PROPERTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE
LENDER TO ENTER INTO THIS NOTE AND THE OTHER LOAN DOCUMENTS, MAKE THE LOANS AND
EXTEND THE OTHER FINANCIAL ACCOMMODATIONS CONTEMPLATED HEREUNDER AND THEREUNDER.
IN WITNESS WHEREOF, the Borrower has caused this Note to be executed in
its corporate name by its duly authorized corporate officer as to the date first
above written.
DRYCLEAN USA, INC.,
By: /s/ Xxxxxxx Xxxxxxx, Pres.
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Xxxxxxx Xxxxxxx, President
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