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Principal
Amount: $1,000,000
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Date of
Note: January 13, 2009
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PROMISE TO PAY. Stationers, Inc.
(“Borrower”) promises to pay to FIRST SENTRY BANK
(“Lender,.), or order, in lawful money of the United States
of America, the principal amount of One Million & 00/100
Dollars ($1,000,000.00) or so much as may be outstanding, together
with interest on the unpaid outstanding principal balance of each
advance. Interest shall be calculated from the date of each advance
until repayment of each advance.
PAYMENT. Borrower will pay this loan in one
payment of all outstanding principal plus all accrued unpaid
interest on July 13, 2010. In addition, Borrower will pay regular
monthly payments of all accrued unpaid interest due as of each
payment date, beginning February 13,2009, with all subsequent
interest payments to be due on the same day of each month after
that. Unless otherwise agreed or required by applicable law,
payments will be applied first to any unpaid collection costs; then
to any late charges; then to any accrued unpaid interest; and then
to principal. Borrower will pay Lender at Lender’s address
shown above or at such other place as Lender may designate in
writing.
VARIABLE INTEREST RATE. The interest rate on this Note is subject to
change from time to time based on changes in an independent index
which is the Prime Rate as published in the Wall Street Journal
(the “Index”). The Index is not necessarily the lowest
rate charged by Lender on its loans. If the Index becomes
unavailable during the term of this loan, Lender may designate a
substitute index after notifying Borrower. Lender will tell
Borrower the current Index rate upon Borrower’s request. The
interest rate change will not occur more often than each day.
Borrower understands that Lender may make loans based on other
rates as well. The Index currently is 3.250% per annum. The
interest rate to be applied to the unpaid principal balance of this
Note will be calculated as described in the “INTEREST
CALCULATION METHOD” paragraph using a rate equal to the
Index, adjusted if necessary for any minimum and maximum rate
limitations described below, resulting in an initial rate of 4.250%
per annum based on a year of 360 days. NOTICE: Under no
circumstances will the interest rate on this Note be less than
4.250% per annum or more than the maximum rate allowed by
applicable law.
INTEREST CALCULATION METHOD. Interest on this
Note is computed on a 365/360 basis; that is, by applying the ratio
of the interest rate over a year of 360 days, multiplied by the
outstanding principal balance, multiplied by the actual number of
days the principal balance is outstanding. All interest payable
under this Note is computed using this method.
PREPAYMENT. Borrower may pay without penalty all or a
portion of the amount owed earlier than it is due. Early payments
will not, unless agreed to by Lender in writing, relieve Borrower
of Borrower’s obligation to continue to make payments of
accrued unpaid interest, Rather, early payments will reduce the
principal balance due. Borrower agrees not to send Lender payments
marked “paid in full”, “without recourse”,
or similar language. If Borrower sends such a payment, Lender may
accept it without losing any of Lender’s rights under this
Note, and Borrower will remain obligated to pay any further amount
owed to Lender. All written communications concerning disputed
amounts, including any check or other payment instrument that
indicates that the payment constitutes “payment in fur of the
amount owed or that is tendered with other conditions or
limitations or as full satisfaction of a disputed amount must be
mailed or delivered to: FIRST SENTRY BANK, P.O. BOX 2107
HUNTINGTON, WV 25721.
LATE CHARGE. If a payment is 10 days or more late, Borrower
will be charged $25.00.
INTEREST AFTER DEFAULT. Upon default, including failure to pay upon
final maturity, the total sum due under this Note will continue to
accrue interest at the interest rate under this Note. However, in
no event will the interest rate exceed the maximum interest rate
limitations under applicable law.
DEFAULT. Each of the following shall constitute an event
of default (“Event of Default”) under this
Note:
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Payment Default. Borrower fails to make any payment when due
under this Note.
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Other Defaults. Borrower fails to comply with or to perform any
other term, obligation, covenant or condition contained in this
Note or in any of the related documents or to comply with or to
perform any term, obligation, covenant or condition contained in
any other agreement between Lender and Borrower.
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False Statements. Any warranty, representation or statement made
or furnished to Lender by Borrower or on Borrower’s behalf
under this Note or the related documents is false or misleading in
any material respect, either now or at the time made or furnished
or becomes false or misleading at any time thereafter.
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Insolvency. The dissolution or termination o
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