Exhibit 10.3
SECURED PROMISSORY NOTE
Englewood, Colorado
FOR
VALUE RECEIVED, Cadence II, LLC DBA Network Cadence, a Colorado
limited liability company (“ Borrower ”), hereby
promises to pay to the order of Pat Burke and Ann Burke (“
Lenders ”), in lawful money of the United States at
the address of Lenders set forth herein, the principal amount of
$2,800,000 (the “ Principal Amount ”), together
with Interest (as defined in Section 1). This Secured Promissory
Note (“ Note ”) has been executed by Borrower on
the date set forth above (the “ Effective Date
”).
1.
Interest . The Principal Amount shall bear interest (“
Interest ”) at a rate per annum equal to four (4)
percentage points higher than the interest rate announced and
printed in the Wall Street Journal, Western Edition as its
“Prime Rate,” on the date of this Note, with respect to
the period ended August 31, 2009, and thereafter, with respect to
each successive three-month period (or part thereof), on the first
banking day of each such successive three-month period (or part
thereof) (the “ Interest Rate ”), from the
Effective Date and continuing until payment in full of the
Principal Amount.
2.
Payments . This Note shall be paid in ten (10) quarterly
installments consisting of a principal payment of Two Hundred
Eighty Thousand Dollars ($280,000.00) plus all Interest accrued
since the preceding payment (or, in the case of the first payment,
since the date of this Note), commencing August 31, 2009, and
continuing on the last day of each succeeding three-month period,
with the final payment due and payable on November 30,
2011.
3.
Maturity Date . The Principal Amount, all accrued Interest
thereon and all other sums due hereunder, shall be paid in full on
November 30, 2011.
4.
Security Interest .
(a)
Borrower hereby grants to Lenders a security interest in all
present and future property of Borrower wherever located and
however described (including, without limitation, any and all
present and future goods, whether constituting inventory,
equipment, or consumer goods (and whether or not constituting a
fixture) and any and all present and future instruments, money,
documents, chattel paper, accounts, contract rights, and general
intangibles), together, in each case, with all proceeds and
products thereof (collectively, the “ Collateral
”). The foregoing security interest secures, and the
Collateral is security for, the full and prompt payment when due
of, and the performance of, the obligations of Borrower under this
Note and all reasonable expenditures made or incurred by Lenders to
protect and maintain the Collateral and enforce the rights of
Lenders under the Note. The foregoing pledge shall create a
continuing security interest in the Collateral and shall (A) remain
in full force and effect until payment in full of the obligations
of Borrower under this Note and (B) be binding upon Borrower and
its successors and assigns.
(b)
Borrower agrees that at any time and from time to time, Borrower
will promptly execute and deliver all further instruments and
documents, and take all further action, that may be necessary or
desirable in order to perfect and protect the security interest
granted or purported to be granted hereby to enable Lenders to
exercise and enforce their rights and remedies hereunder with
respect to any Collateral.
5.
Application of Payments .
5.1.
Except as otherwise expressly provided herein, payments under this
Note shall be applied (i) first to the repayment of any sums
incurred by Lenders for the payment of any expenses in enforcing
the terms of this Note, (ii) then to the payment of Interest and
(iii) then to the reduction of the Principal Amount.
5.2.
Upon payment in full of the Principal Amount and applicable accrued
and unpaid Interest thereon, within ten (10) days of receipt of
written request by Borrower, Lender shall cause this Note to be
marked “Paid in Full” and returned to
Borrower.
5.3.
