Customer
No.
Loan
No.
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Second
Amended and Restated
Commercial Promissory
Note
(SD-L&S)
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$2,500,000.00
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Raleigh, North Carolina
May 31, 2008
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MASTER
NOTE
FOR VALUE
RECEIVED, the undersigned (whether one or more, "Borrower")
promises to pay to RBC BANK (USA) (formerly known as RBC Centura
Bank) ("Bank"), or order, the sum of Two Million Five Hundred
Thousand Dollars ($2,500,000.00), or so much thereof as shall have
been disbursed from time to time and remains unpaid, together with
interest at the rate and payable in the manner hereinafter stated.
Principal and interest shall be payable at any banking office of
Bank in the city or town indicated above, or such other place as
the holder of this Note may designate.
THIS IS AN
AMENDED AND RESTATED COMMERCIAL PROMISSORY NOTE and amends and
replaces in all respects and in its entirety that certain Amended
and Restated Commercial Promissory Note dated May 31, 2006 in the
original amount of up to Two Million Dollars ($2,000,000.00) from
Borrower to the order of Bank, as modified by that certain Fifth
Modification Agreement dated May 31, 2006, that certain Sixth
Modification Agreement dated May 31, 2007 and that certain
Assignment and Assumption Agreement dated May 31, 2007
(collectively, the "Original Note"). This Second Amended and
Restated Commercial Promissory Note does not constitute a novation
of Borrower's obligation under the Original Note, but an amendment,
restatement and increase in the principal amount of such
obligation.
Article I. Interest Rate.
Section 1.1.
Rate of Accrual . Interest will accrue on the unpaid
principal balance at the rate set forth in Section 1.2.1. until
maturity of this Note, whether such maturity occurs by acceleration
or on the Maturity Date; and, at Bank's option, interest at the
foregoing rate will accrue on any unpaid interest before such
maturity. Interest will accrue on any unpaid balance owing under
this Note, whether principal, interest, fees, premiums, charges or
costs and expenses, after maturity at the rate set forth in Section
1.2.2. All accrual rates of interest under this Note will be
contract rates of interest, whether a pre-default rate or a default
rate, and references to contract rates in any loan documents
executed and delivered by Borrower or others to Bank in connection
with this Note shall be to such contract rates.
Section 1.2.
Interest Rates.
1.2.1. Pre-Default Rate . Subject
to the provisions of Section 1.2.2. below, interest payable on this
Note per annum will accrue at 0.25% plus the RBC Bank Prime Rate.
The "RBC Bank Prime Rate" is one of Bank's variable rate base
indices for credit extensions and is set by Bank at its discretion
based on Bank's perception of market interest rate levels, trends
and general economic conditions. It is not tied to any specific
index published by any other person and is not represented by Bank
to be the lowest rate at which Bank extends credit.
1.2.2. Default Rate . Upon the
nonpayment of any payment of interest described herein, Bank, at
its option and without accelerating this Note, may accrue interest
on such unpaid interest at a rate per annum ("Default Rate") equal
to the lesser of the maximum contract rate of interest that may be
charged to and collected from Borrower on the loan evidenced by
this Note under applicable law or three percent (3.0%) plus the
pre-default interest rate otherwise applicable hereunder, as set
forth in Section 1.2.1.. After maturity of this Note, whether by
acceleration or otherwise, interest will accrue on the unpaid
principal of this Note, any accrued but unpaid interest and all
fees, premiums, charges and costs and expenses owing hereunder at
the Default Rate until this Note is paid in full,
whether this Note is paid in full pre-judgement or
post-judgement.
1.2.3.
Variable Rate: Calculation of Interest
.
1.2.3.1. Variable Rate . This is a
variable rate note. Any change in the rate of interest payable
under this Note will equal the change in the variable rate index to
which such rate is tied, but the rate at which interest accrues
under this Note shall never exceed the maximum contract rate which
may be charged to and collected from Borrower on the loan evidenced
by this Note under applicable law. Bank shall have no obligation to
notify Borrower of adjustments in the rate of interest payable
under this Note. Adjustments to the rate of interest will be
effective on the date of change in the variable rate
index.
1.2.3.2. Calculation of Interest .
All interest payable under this Note shall be calculated monthly
and accrue daily on the basis of the actual number of days elapsed
and a year of three hundred sixty (360) days. 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
close of business. Payments in federal funds, immediately available
in the place designated for payment, received by Bank prior to 2:00
p.m. local time at said place of payment, shall be credited as if
received prior to close of business on the day the funds are
immediately available; while other payments, at the option of Bank,
may not be credited until such payments are immediately available
to Bank, in federal funds, in the place designated for payment,
prior to 2:00 p.m. local time at said place of payment on a day on
which Bank is open for business.
Article II. Payment
Terms.
Section 2.1.
Interest Payment Terms . Payments under this Note
include an interest component and a principal component. The
principal component is set forth in Section 2.2 below. The interest
component shall be paid as follows: interest shall be payable
monthly, in arrears, beginning June 10, 2008 and continuing on the
same calendar day of each consecutive month thereafter until the
Maturity Date, when all accrued but unpaid interest is due and
payable in full.
Section 2.2.
Principal Payment terms:. Maturity Date . As stated in
Section 2.1 above, payments under this Note include an interest
component and a principal component. The interest component is set
forth in Section 2.1 above. The principal component shall be paid
as follows: principal shall be payable in one single payment on May
31, 2009 (herein referred to as the "Maturity Date").
Section 2.3.
Prepayment . This Note may be prepaid in whole, or in
part, at any time without premium or penalty.
Section 2.4.
Application of Payments . All payments made on this
Note shall be applied first to payment of all late fees, charges,
premiums and costs and expenses due but unpaid under this Note,
then to accrued but unpaid interest and finally to principal, in
the inverse order of the payment dates therefor, unless Bank
determines in its sole discretion to apply payments in a different
order or applicable law requires a different application of
payments. The partial prepayment of this Note, if permitted, shall
not result in a payment holiday or any other deferral of any
regularly scheduled payments under this Note, all of which shall be
made as and when the same are scheduled to be paid.
Article III. Loan Agreement and
Security.
Section 3.1.
Loan Agreement . The loan evidenced by this Note was made
pursuant to a commitment letter ("Commitment Letter") from Bank to
Borrower dated December 21, 2004. Borrower and Bank have entered
into that certain Loan and Security Agreement dated February 1,
2005. as modified by that certain Modification Agreement dated June
6, 2005, that certain Second Modification Agreement dated January
13, 2006, that certain Third Modification Agreement dated March 17,
2006, that certain Fourth Modification Agreement dated April 21,
2006, that certain Fifth Modification Agreement dated May 31, 2006,
that certain Sixth Modification Agreement dated May 31, 2007, that
certain Assignment and Assumption Agreement dated May 31, 2007 and
that certain Seventh Modification Agreement dated of even date
herewith (collectively, the "Loan and Security Agreement").
Borrower shall perform and abide by, as and when so required, each
and all of the covenants, terms and conditions imposed upon or
applicable to Borrower in the Commitment Letter, the Loan and
Security Agreement and all security documents and other agreements
referenced in the Loan and Security Agreement.
Section
3.2. Security Documents . This Note is
secured by (1) the Loan and Security Agreement, (2) the security
documents and other supporting obligations identified in the Loan
and Security Agreement, (3) the security documents and other
supporting obligations which reference that they secure this Note
or the Loan and Security Agreement, (4) any security documents and
other supporting obligations which reference that they secure all
indebtedness or other obligations owing from time to time by
Borrower to Bank, and (5) any security documents and other
supporting obligations which reference that they secure all
indebtedness from time to time owing from Borrower to Bank other
than consumer credit as defined under the Federal Reserve Board's
Regulation Z (Truth-in-Lending) (12 CFR 226 et seq.)
("security documents").
Article IV. Default and
Acceleration.
Section 4.L
Late Charges and Expenses . Borrower agrees to pay,
upon demand by Bank or if demand is not sooner made, on maturity of
this Note, whether such maturity occurs by acceleration or on the
Maturity Date; for each payment past due for fifteen (15)
or
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