PROMISSORY NOTE (Revolving Note)
(Revolving
Note)
|
$1,000,000.00
|
October
19,
2005
|
Oklahoma
City, Oklahoma
FOR
VALUE
RECEIVED, the undersigned XXXXXXX MACHINE WORKS, INC., a Texas corporation
("Machine") and XXXXXXX INDUSTRIES INC. (formerly EXCALIBUR INDUSTRIES, INC.),
a
Delaware corporation ("Industries") (Machine, Holdings, and Industries are
collectively referred to herein as the "Borrowers"), jointly and severally
promise to pay to the order of STILLWATER NATIONAL BANK AND TRUST COMPANY,
and
its successors and assigns (the "Lender") at 0000 Xxxxx Xxxxx Xxxxxx, Xxxxx,
Xxxxxxxx 00000, or at such other place as may be designated in writing by the
Lender, the principal sum of ONE MILLION DOLLARS ($1,000,000.00) (the “Face
Amount”), or so much thereof which is actually outstanding from time to time,
together with interest thereon at the interest rates hereinafter stated, payable
as set forth below.
Unless
otherwise defined herein, all terms defined or referenced in that certain Loan
Agreement of even date herewith between the Borrowers and the Lender (the "Loan
Agreement") will have the same meanings herein as therein.
Borrower
shall be permitted to obtain advances from the Lender in accordance with the
terms of this Note and the Loan Agreement of amounts having the aggregate
principal balance at any one time not exceeding the lesser of (a) the Borrowing
Base or (b) the Face Amount. Borrowers agree to be liable for all sums advanced
in accordance with the Loan Agreement.
Interest
on this Note will be paid at the interest rate equal to the Prime Rate plus
two
percent (2%) per annum, adjusted on each day on which a change in the Prime
Rate
occurs (the "Interest Rate"). "Prime Rate" means the prime rate as published
in
the "Money Rates" Section of the Wall
Street Journal,
which
rate is not necessarily the lowest rate of interest charged by the Lender.
All
interest hereon shall be calculated for the actual number of days elapsed at
a
per diem charge based on a year consisting of 360 days.
Interest
on this Note will be paid monthly commencing on November 30, 2005, with payments
on the last day of each calendar month thereafter. The entire unpaid principal
balance of this Note and all accrued interest hereon will be due and payable
on
October 19, 2006 (the "Maturity Date"). In addition, should the principal
balance of this Note exceed the Borrowing Base, Borrowers shall immediately
notify Lender of such event and Borrowers shall immediately, without the
necessity of Lender making a demand or giving notice to Borrowers or to any
person obligated to pay the indebtedness of this Note, pay Lender so much of
the
outstanding principal so that the then remaining principal balance shall equal
or be less than the Borrowing Base.
This
Note
is executed and delivered in connection with, and subject to the terms and
conditions contained in, the Loan Agreement. Advances and payments hereunder
may, at the option of the Lender, be recorded on this Note or on the books
and
records of the Lender and will be prima facie evidence of said advances,
payments and the unpaid balance of this Note. All payments will first be applied
to the payment of accrued interest and the balance will be applied in reduction
of the principal balance hereof provided that no payment will be applied to
this
Note until received by the Lender in collected funds.
The
Borrowers will have the right to prepay this Note in whole or in part at any
time and from time to time without premium or penalty.
If
a
payment owing hereunder is more than ten (10) days late, the Borrowers will
be
charged ten percent (10%) of such unpaid payment or $500.00, whichever is less,
as a late charge, or in the alternative, at the Lender's option, while any
Default exists hereunder or under the Loan Agreement or in the performance
or
observance of any of the terms, covenants or conditions of this Note or any
of
the documents evidencing or securing this Note or of any instrument now or
hereafter securing the payment of the indebtedness evidenced hereby, the entire
unpaid principal balance hereof shall bear interest at the per annum rate equal
to six percent (6%) in excess of the then current interest rate payable
hereunder, but not less than fifteen percent (15%). During the existence of
any
such Default, the Lender may apply payments received on any amounts due
hereunder, or under the terms of any instrument now or hereafter evidencing
or
securing such indebtedness, as the Lender may determine, and if the Lender
so
elects, notice of election being expressly waived, the principal hereof
remaining unpaid, together with accrued interest, shall at once become due
and
payable. Any and all additional interest at the rate provided in this paragraph
which has accrued shall be payable at the time of, and as a condition precedent
to, the curing of any Default.
The
Borrowers jointly and severally agree that if, and as often as, this Note is
placed in the hands of an attorney for collection or to defend or enforce any
of
the Lender's rights hereunder or under any instrument securing payment of this
Note, the Borrowers will pay the Lender's reasonable attorneys' fees and
expenses, all court costs and all other reasonable expenses incurred by the
Lender in connection therewith.
This
Note
is issued by the Borrowers and accepted by the Lender pursuant to a lending
transaction negotiated, consummated, and to be performed in Oklahoma. Payment
of
this Note is secured by a certain Security Agreement of even date (the "Security
Agreement"). This Note is to be construed according to the internal laws of
the
State of Oklahoma. All actions with respect to this Note, the Security Agreement
or any other instrument securing payment of this Note may be instituted in
the
state or federal courts in Tulsa County, Oklahoma, or Oklahoma County, Oklahoma,
as the Lender may elect, and by execution and delivery of this Note, the
Borrowers jointly and severally irrevocably and unconditionally submit to the
jurisdiction (both subject matter and personal) of each such court and
irrevocably and unconditionally waives: (a) any objection the Borrowers might
now or hereafter have to the venue in any such court; and (b) any claim that
any
action or proceeding brought in any such court has been brought in an
inconvenient forum.
On
the
failure to pay any principal or interest when due hereunder, or under certain
other promissory notes (as defined or described in the Loan Agreement), or
on
the occurrence of any Default under the Loan Agreement, as defined or described
therein, at the option of the Lender, the entire indebtedness evidenced by
this
Note will become immediately due, payable and collectible then or thereafter
as
the Lender might elect, regardless of the date of maturity hereof. Failure
by
the Lender to exercise such option will not constitute a waiver of the right
to
exercise the same in the event of any subsequent Default.
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The
makers, endorsers, sureties, guarantors and all other persons who may become
liable for all or any part of this obligation severally waive presentment for
payment, protest and notice of nonpayment. Said parties consent to any extension
of time (whether one or more) of payment hereof, release of all or any part
of
the security for the payment hereof or release of any party liable for the
payment of this obligation. Any such extension or release may be made without
notice to any such party and without discharging such party's liability
hereunder.
IN
WITNESS WHEREOF, the Borrowers have executed this instrument effective the
date
first above written.
| XXXXXXX MACHINE WORKS, INC., a Texas corporation | ||
| By: /s/ Xxxxxxx X. Xxxxxxxx | ||
| Name: Xxxxxxx X. Xxxxxxxx | ||
| Title: CFO | ||
| XXXXXXX INDUSTRIES, INC. (formerly EXCALIBUR INDUSTRIES, INC., a Delaware corporation | ||
| By: /s/ Xxxxxxx X. Xxxxxxxx | ||
| Name: Xxxxxxx X. Xxxxxxxx | ||
| Title: CFO | ||
| (the "Borrowers") | ||
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