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AMENDED AND RESTATED PROMISSORY NOTE

Promissory Note

AMENDED AND RESTATED PROMISSORY NOTE | Document Parties: BANK OF TEXAS, N.A. | COSTAR VIDEO SYSTEMS, LLC | L Q Corporation, Inc | SIELOX, INC | SIELOX, LLC You are currently viewing:
This Promissory Note involves

BANK OF TEXAS, N.A. | COSTAR VIDEO SYSTEMS, LLC | L Q Corporation, Inc | SIELOX, INC | SIELOX, LLC

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Title: AMENDED AND RESTATED PROMISSORY NOTE
Governing Law: Texas     Date: 4/6/2009
Industry: Audio and Video Equipment     Sector: Consumer Cyclical

AMENDED AND RESTATED PROMISSORY NOTE, Parties: bank of texas  n.a. , costar video systems  llc , l q corporation  inc , sielox  inc , sielox  llc
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Exhibit 10.2

 

AMENDED AND RESTATED PROMISSORY NOTE

 

$5,000,000.00

December 10, 2008

 

FOR VALUE RECEIVED, COSTAR VIDEO SYSTEMS, LLC, a Delaware limited liability company (“ Costar ”), SIELOX, INC., a Delaware corporation (“ Parent ”), and SIELOX, LLC, a Delaware limited liability company (“ Sielox,” LLC ” and, together with Costar and Parent, jointly and severally, the “ Borrower ”), having the address set forth for notice in the Loan Agreement, hereby promises to pay to the order of BANK OF TEXAS, N.A., a national banking association (together with its successors and assigns and any subsequent holders of this Promissory Note, the “ Lender ”), as hereinafter provided, the principal sum of FIVE MILLION AND NO/100 DOLLARS ($5,000,000.00) or so much thereof as may be advanced by Lender from time to time hereunder to or for the benefit or account of Borrower, together with interest thereon at the Note Rate (as hereinafter defined), and otherwise in strict accordance with the terms and provisions hereof.

 

ARTICLE I

DEFINITIONS

 

Section 1.1.

Definitions .  As used in this Promissory Note, the following terms shall have the following meanings:

 

Borrower :     As identified in the introductory paragraph of this Note.

 

Business Day :   A weekday, Monday through Friday, except a legal holiday or a day on which banking institutions in Dallas, Texas are authorized or required by law to be closed. Unless otherwise provided, the term “days” when used herein shall mean calendar days.

 

Change :    (i) any change after the date of this Note in the risk-based capital guidelines applicable to Lender or (ii) any adoption of or change in any other law, governmental or quasi-governmental rule, regulation, policy, guideline, interpretation, or directive (whether or not having the force of law) after the date of this Note that affects capital adequacy or the amount of capital required or expected to be maintained by Lender or any entity controlling Lender.

 

Charges :   All fees, charges and/or any other things of value, if any, contracted for, charged, taken, received or reserved by Lender in connection with the transactions relating to this Note and the other Loan Documents, which are treated as interest under applicable law.

 

Debtor Relief Laws :  Title 11 of the United Stales Code, as now or hereafter in effect, or any other applicable law, domestic or foreign, as now or hereafter in effect, relating to bankruptcy, insolvency, liquidation, receivership, reorganization, arrangement or composition, extension or adjustment of debts, or similar laws affecting the rights of Creditors.

 

Default Rate :    A rate per annum equal to the Note Rate plus five percent (5%), but in no event in excess of the Maximum Lawful Rate.

 

Event of Default :    Any event or occurrence described under Section 3.1 hereof.

 

Lender :    As identified in the introductory paragraph of this Note.

 

Loan Agreement :    The Amended and Restated Loan Agreement of even date herewith executed by Lender and Borrower, as the same may be amended, restated, modified and/or otherwise changed from time to time.

 

Loan Documents :    As defined in the Loan Agreement.

 

Maturity Date :    December 9, 2009.

 

Amended and Restated Promissory Note – Page 1

 


Maximum Lawful Rate :   The maximum lawful rate of interest which may be contracted for, charged, taken, received or reserved by Lender in accordance with the applicable laws of the State of Texas (or applicable United States federal law to the extent that such law permits Lender to contract for, charge, take, receive or reserve a greater amount of interest than under Texas law), taking into account all Charges made in connection with the transaction evidenced by this Note and the other Loan Documents.

 

Note :   This Amended and Restated Promissory Note, as the same may be amended, renewed, replaced, extended, supplemented, consolidated, restated, modified, otherwise changed and/or increased from time to time.

 

Note Rate :   The rate equal to the lesser of(a) the Maximum Lawful Rate or (b) the Prime Rate.

 

Payment Date : The first day of each and every calendar month during the term of this Note.

 

Prime Rate :   The rate of interest set by BOK Financial Corporation, in its sole discretion, on a daily basis as published by BOK Financial Corporation from time to time, which Borrower hereby acknowledges and agrees may not be the lowest interest rate charged by Lender, and which rate shall change as said prime rate changes.

 

Related Indebtedness :   Any and all indebtedness paid or payable by Borrower to Lender pursuant to the Loan Documents or any other communication or writing by or between Borrower and Lender related to the transaction or transactions that are the subject matter of the Loan Documents, except such indebtedness which has been paid or is payable by Borrower to Lender under this Note.

 

Any capitalized term used in this Note and not otherwise defined herein shall have the meaning ascribed to each such term in the Loan Agreement. All terms used herein, whether or not defined in Section 1.1 hereof, and whether used in singular or plural form, shall be deemed to refer to the object of such term whether such is singular or plural in nature, as the context may suggest or require. Definitions contained in this Note and each of the other Loan Documents which identify documents, agreements or instruments shall be deemed to include all amendments and supplements to such documents from the date of this Note and all prior and future amendments, modifications, and supplements thereto entered into from time to time. Each reference in the Loan Documents to Borrower shall mean Borrower and its successors and assigns.

 

ARTICLE II

PAYMENT TERMS

 

Section 2.1.

Payment of Principal and I nterest.     All accrued but unpaid interest on the principal balance of this Note outstanding from time to time shall be payable due and payable each Payment Date beginning on January 1,2009. The then-outstanding principal balance of this Note and all accrued but unpaid interest thereon shall be due and payable on the Maturity Date or upon the earlier maturity hereof, whether by acceleration or otherwise. Borrower may from time to time during the terms of this Note borrow, partially or wholly repay its outstanding borrowings, and reborrow, subject to all of the limitations, terms and conditions of this Note and of the Loan Documents; provided however, that the total outstanding borrowings under this Note shall not at any time exceed the lesser of(a) the principal amount stated above or (b) the Borrowing Base minus all outstanding Letter of Credit Liabilities. The unpaid principal balance of this Note at any time shall be the total amount advanced hereunder by Lender less the amount of principal payments made hereon by or for Borrower, which balance may be endorsed hereon from time to time by Lender or otherwise noted in Lender’s records, which notations shall be, absent manifest error, conclusive evidence of the amounts owing hereunder from time to time.

 

Section 2.2.

Application .     Except as expressly provided herein to the contrary, all payments on this Note shall be applied in the following order of priority: (i) the payment or reimbursement of any expenses, costs or obligations (other than the outstanding principal balance hereof and interest hereon) for which either Borrower shall be obligated or Lender shall be entitled pursuant to the provisions of this Note or the other Loan Documents, (ii) the payment of accrued but unpaid interest hereon, and (iii) the payment of all or any portion of the principal balance hereof then outstanding hereunder, in the direct order of maturity. If an Event of Default exists under this Note or under any of the other Loan Documents, then Lender may, at the sole option of Lender, apply any such payments, at any time and from time to time, to any of the items specified in clauses (i), (it) or (iii) above without regard to the

 

Amended and Restated Promissory Note – Page 2

 


order of priority otherwise specified in this Section 2.2 and any application to the outstanding principal balance hereof may be made in either direct or inverse order of maturity.

 

Section 2.3.

Payments .     All payments under this Note made to Lender shall be made in immediately available funds at 333 W. Campbell Road, Richardson, Texas 75080 (or such other place as Lender, in Lender’s sole discretion, may have established by delivery of written notice thereof to Borrower from time to time), without offset, in lawful money of the United States of America, which shall at the time of payment be legal tender in payment of all debts and dues, public and private. Payments by check: or draft shall not constitute payment in immediately available funds until the required amount is actually received by Lender in full. Payments in immediately available funds received by Lender in the place designated for payment on a Business Day prior to 11:00 a.m. Dallas, Texas time at said place of payment shall be credited prior to the close of business on the Business Day received, while payments received by Lender on a day other than a Business Day or after 11:00 a.m. Dallas, Texas time on a Business Day shall not be credited until the next succeeding Business Day. If any payment of principal or interest on this Note shall become due and payable on a day other than a Business Day, such payment shall be made on the next succeeding Business Day. Any such extension of time for payment shall be included in computing interest which bas accrued and shall be payable in connection with such payment

 

Section 2.4.

Computation Period .     Interest on the indebtedness evidenced by this Note shall be computed on the basis of a three hundred sixty (360) day year and shall accrue 00 the actual number of days elapsed for any whole or partial month in which interest is being calculated. In computing the number of days during which interest accrues, the day on which funds are initially advanced shall be included regardless of the time of day such advance is made, and the day on which funds are repaid shall be included unless repayment is credited prior to the close of business on the Business Day received as provided in Section 2.3 hereof.

 

Section 2.5.

Prepayment .     Borrower shall have the right to prepay, at any time and from time to time upon five (5) days prior written notice to Lender, without fee, premium or penalty (except as Doted below), all or any portion of the outstanding principal balance hereof: provided, however, that such prepayment shall also include any and all accrued but unpaid interest on the amount of principal being so prepaid through and including the date of prepayment, plus any other sums which have become due to Lender under the other Loan Documents on or before the date of prepayment, but which have not been fully paid. Prepayments of principal will be applied in inverse order of maturity. If this Note is prepaid in full, at the option of Lender any commitment of Lender to make further advances shall automatically terminate and shall be of no further force or effect Borrower must pay on DEMAND the amount by which at any time the unpaid principal balance of this Note, plus the aggregate Letter of Credit Liabilities, exceeds the lesser of the Borrowing Base or the Maximum Revolver Amount

 

Section 2.6.

Unconditional Payment .     Borrower is and shall be obligated to pay all principal, interest and any and all other amounts which become payable under this Note or under any of the other Loan Documents absolutely and unconditionally and without any abatement, postponement, diminution or deduction whatsoever and without any reduction for counterclaim or setoff whatsoever. If at any time any payment received by Lender hereunder shall be deemed by a court of competent jurisdiction to have been a voidable preference or fraudulent conveyance under any Debtor Relief Law, then the obligation to make such payment shall survive any cancellation or satisfaction of this Note or return thereof to Borrower and shall not be discharged or satisfied with any prior payment thereof or cancellation of this Note, but shall remain a valid and binding obligation enforceable in accordance with the terms and provisions hereof and such payment shall be immediately due and payable upon demand.

 

Section 2.7.

Partial or Incomplete Payments .     Remittances in payment of any part of this Note other than in the required amount in immediately available funds at the place where this Note is payable shall not, regardless of any receipt or credit issued therefor, constitute payment until the required amount is actually received by Lender in full in accordance herewith and shall be made and accepted subject to the condition that any check or draft may be handled for collection in accordance with the practice of the collecting bank or banks. Acceptance by Lender of any payment in an amount less than the full amount then due shall be deemed an acceptance on account only, and the failure to pay the entire amount then due shall be and continue to be an Event of Default in the payment of this Note.

 

Amended and Restated Promissory Note – Page 3

 


Section 2.8.

Default Rate, etc .     For so long as any Event of Default exists under this Note or under any of the other Loan Documents, regardless of whether or not there has been an acceleration of the indebtedness evidenced by this Note, and at all times after the maturity of the indebtedness evidenced by this Note (whether by acceleration or otherwise), and in addition to all other rights and remedies of Lender hereunder, interest shall accrue on the outstanding principal balance hereof at the Default Rate, and such accrued interest shall be immediately due and payable. Borrower acknowledges that it would be extremely difficult or impracticable to determine Lender’s actual damages resulting from any late payment or Event of Default, and such late charges and accrued interest are reasonable estimates of those damages and do not constitute a penalty. If Lender determines that the amount of capital required or expected to be maintained by Lender or any entity controlling Lender, is increased as a result of a Change, then, within fifteen (15) days of demand by Lender, Borrower shall pay to Lender the amount necessary to compensate for any shortfall in the rate of return on the portion of such increased capital that Lender determines is attributable to this Note or the principal amount outstanding hereunder (after taking into account Lender’s policies as to capital adequacy).

 

ARTICLE III

EVENT OF DEFAULT AND REMEDIES

 

Section 3.1.

Event of Default .     The occurrence or happening, at any time and from time to time, of anyone or more of the following shall immediately constitute an “ Event of Default ” under this Note:

 

(a)

Borrower shall fail, refuse or neglect to pay and satisfy, in full and in the applicable method and manner required, any required payment of principal or interest or any other portion of the indebtedness evidenced by this Note within three days of when the same shall become due and payable, whether at the stipulated due date thereof, at a date fixed for payment, or at maturity, by acceleration or otherwise; or

 

(b)

The occurrence of any other Event of Default or Default as defined in or under this Note, the Loan Agreement or any other Loan Document that remains uncured under and pursuant to the provisions of this Note, the Loan Agreement or any other Loan Document.

 

Section 3.2.

Remedies .     Upon the occurrence of an Event of Default, Lender shall have the immediate


 
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