Exhibit
10.2
THIS SUBORDINATED
PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS.
THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT
WITH RESPECT TO THIS NOTE UNDER SUCH ACT AND APPLICABLE LAWS OR
SOME OTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT
AND APPLICABLE LAWS OR AN OPINION OF COUNSEL SATISFACTORY TO THE
BORROWER THAT SUCH REGISTRATION IS NOT REQUIRED.
PAYMENTS UNDER THIS
SUBORDINATED PROMISSORY NOTE ARE SUBJECT TO THE SUBORDINATION
PROVISIONS SET FORTH HEREIN.
SUBORDINATED
PROMISSORY NOTE
Delivered in Fort
Lauderdale, Florida
October 7, 2009
$1,500,000.00
THIS SUBORDINATED
PROMISSORY NOTE (this “Note”) is issued
by GULFSTREAM INTERNATIONAL GROUP, INC. , a Delaware
corporation having an executive office located at 3201 Griffin
Road, 4 th Floor, Fort Lauderdale, Florida 33312 (the
“Borrower”). Unless otherwise defined herein, all
capitalized terms used herein shall have the meanings given to them
in Section 8 of this Note.
1.
PROMISE TO PAY.
For
value received, the Borrower promises to pay to the order of
GULFSTREAM FUNDING II, LLC , a Delaware limited liability
company (the “Lender”), in lawful money of the United
States and immediately available funds at any address of the
Lender, the maximum sum of One Million Five Hundred Thousand
Dollars ($1,500,000.00), or such lesser amount as may be loaned and
advanced to the Borrower, plus any additional principal amount
accruing from time to under Section 3(b) of this Note
(collectively, the “Principal Amount”) on January 15,
2010 (the “Maturity Date”). As used herein, the
term “Holder” shall include the Lender and any
transferee, assignee or successor of the Lender, subject to the
restrictions set forth at the beginning of this Note. The
Principal Amount of this Note shall be made in a series of loans
and advances to the Borrower, as contemplated by Exhibit A hereto;
which Exhibit A shall be updated by the Lender and Borrower on each
occasion that a loan and advance is made hereunder.
2.
INTEREST.
(a)
Subject to Section 2(b)
of this Note, the Borrower shall pay interest (calculated on the
basis of a 360-day year for the actual number of days of each year)
on the outstanding portion of the Principal Amount (the
“Outstanding Principal Amount”) from and including the
date of this Note to but not including the date the Outstanding
Principal Amount is paid in full at a rate each day equal to twelve
percent (12%) per annum.
(b)
From and after the
occurrence or existence and during the continuation of any Event of
Default (as defined below), the rate of interest referred to in
Section 2(a) of this Note shall, at the option of the Holder upon
written notice to the Borrower, be increased to eighteen percent
(18%) per annum.
(c)
In no event shall
interest payable under this Note be payable at a rate in excess of
the maximum rate permitted by applicable law. Any amount
deemed to be in excess of such maximum rate
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of interest under a
final judicial interpretation of applicable law shall be deemed to
have been a mistake and automatically canceled, and, if received by
the Holder, shall be refunded to the Borrower, it being the
intention of the Lender and the Borrower that such interest not be
payable at a rate in excess of such maximum rate.
3.
PAYMENTS.
(a)
Maturity
Date :
The Outstanding Principal Amount and all interest and other
amounts payable under this Note and remaining unpaid shall be paid
on the Maturity Date.
(b)
Interest
Payments :
Interest as described in Section 2 of this Note that has
accrued on the Outstanding Principal Amount through the last day of
each calendar month shall be paid in kind and shall be added to the
Outstanding Principal Amount on the first (1 st ) day of
the succeeding calendar month.
4.
SUBORDINATION.
(a)
By its acceptance
hereof and agreement hereto, the Holder covenants and agrees that
the payment of principal and interest on this Note and all
Collection Costs (as defined below) and other amounts from time to
time payable under this Note (collectively, the “Junior
Indebtedness”) be and the same is expressly made subject and
subordinated to the indefeasible payment in full in cash of all
principal of, interest on and other obligations owed by the
Borrower or any of its Subsidiaries to holders of all Senior
Indebtedness (as defined below), to the extent and in the manner
hereinafter set forth.
(b)
If the Senior Lender
(as defined below) notifies the Borrower in writing that there
exists under the Senior Indebtedness or under any agreement
pursuant to which Senior Indebtedness has been incurred any default
or event of default, after giving effect to any applicable grace or
cure period (a “Senior Default”), then no payment of
any Junior Indebtedness under this Note shall be made, and no
property or assets of the Borrower shall be applied to the payment
of this Note, unless and until the Senior Lender has notified the
Borrower in writing that each Senior Default of which notice was
previously so given has been waived or cured, or that such Senior
Indebtedness has been paid in full. The Borrower may make and
the Holder may accept, receive and retain any payment under this
Note so long as such payment is not prohibited under the preceding
sentence or the first sentence of Section 4(d) of this
Note.
(c)
The Holder will not
accelerate the maturity of the Junior Indebtedness evidenced by
this Note or commence any action or proceeding against the Borrower
to recover all or any part of such Junior Indebtedness or join with
any other creditor, including, without limitation, any proceeding
under any bankruptcy, insolvency or similar law or any other
proceeding the result of which could give rise to an Insolvency
Event, unless and until a Senior Lender shall have first
accelerated all Senior Indebtedness and commenced an action or
proceeding against the Borrower and/or its Subsidiaries to recover
all or any part of the Senior Indebtedness, or such Senior
Indebtedness shall have been paid in full.
(d)
Upon the occurrence of
any Insolvency Event of the Borrower or in the event of a sale of
all or substantially all of the assets or any other marshaling of
the assets and liabilities, or any recapitalization, refinancing or
reorganization of the Borrower, the Senior Indebtedness shall first
be indefeasibly paid in full in cash before the Holder shall be
entitled to receive any money, distributions or other assets in any
such proceeding. In any such event, the Senior Lender may
(without having any obligation to do so) file any claim, proof of
claim or other similar instrument necessary to enforce the
obligations of the Borrower in respect of the Junior Indebtedness.
The Holder hereby irrevocably authorizes and grants to the
holders of the Senior Indebtedness an exclusive power (which power
is coupled with an interest), but without imposing any obligation
upon such holders, to demand, sue for,collect and receive on behalf
of the Holder, to be applied to the Senior Indebtedness, every
such
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payment or distribution
of cash, property, stock or obligations, to file claims and proofs
of claim in any statutory or nonstatutory proceeding, to exercise
the rights of the Holder arising under or relating to this Note and
to vote the claim of the Holder under this Note in its sole
discretion in connection with any such event including, without
limitation, the right to participate in any composition of
creditors and to vote at creditors’ meetings for the election
of trustees, acceptances of plans of reorganization and any other
matter upon which the Holder is entitled to vote. In
furtherance of the foregoing, upon the occurrence of any Insolvency
Event of the Borrower and at the reasonable request of the Senior
Lender, the Holder shall execute and deliver to the holders of the
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