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Exhibit 10.2
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES
LAWS. THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED
OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT AS TO THIS NOTE UNDER SAID ACT AND ANY APPLICABLE
STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO STEN CORPORATION THAT SUCH REGISTRATION IS NOT
REQUIRED.
THIS NOTE IS REGISTERED WITH THE PARENT (AS
DEFINED BELOW) PURSUANT TO SECTION 24(B) OF THE SECURITY
AGREEMENT (AS DEFINED BELOW). TRANSFER OF ALL OR ANY
PORTION OF THIS NOTE IS PERMITTED SUBJECT TO THE PROVISIONS SET
FORTH IN SUCH SECTION 24(B) WHICH REQUIRE, AMONG OTHER THINGS,
THAT NO TRANSFER IS EFFECTIVE UNTIL THE TRANSFEREE IS REFLECTED
AS SUCH ON THE REGISTRY MAINTAINED WITH THE AGENT PURSUANT TO
SUCH SECTION 24(B).
SECURED REVOLVING NOTE
FOR VALUE RECEIVED, each of STEN CORPORATION, a
Minnesota corporation (the “ Parent ”), and
the other companies listed on Exhibit A attached hereto
(such other companies together with the Parent, each a “
Company ” and collectively, the “
Companies ”), hereby, jointly and severally,
promises to pay to VALENS U.S. SPV I, LLC (the “
Holder ”) or its registered assigns or successors
in interest, the sum of Five Million Five Hundred Thousand
Dollars ($5,500,000.00), or, if different, the aggregate
principal amount of all Loans (as defined in the Security
Agreement referred to below), together with any accrued and
unpaid interest hereon, on November 23, 2009 (the “
Maturity Date ”) if not sooner indefeasibly paid in
full.
Capitalized terms used herein without definition
shall have the meanings ascribed to such terms in the Security
Agreement dated as of the date hereof (as amended, restated,
modified and/or supplemented from time to time, the “
Security Agreement ”) among the Companies, the
Holder, each other Lender and LV Administrative Services, Inc.,
as administrative and collateral agent for the Lender (the
“ Agent ” together with the Lenders,
collectively, the “ Creditor Parties ”).
The following terms shall apply to this Secured
Revolving Note (this “ Note ”):
ARTICLE I
CONTRACT RATE
1.1
Contract Rate . Subject to Sections
2.2 and 3.9, interest payable on the outstanding principal
amount of this Note (the “ Principal Amount
”) shall accrue at a rate per annum equal to the
“prime rate” published in The Wall Street
Journal from time to time (the “ Prime Rate
”), plus eight and one quarter percent (8.25%) (the
“ Contract Rate ”). The Contract Rate
shall be increased or decreased as the case may be for each
increase or decrease in the Prime Rate in an amount equal to
such increase or decrease in the Prime Rate; each change to be
effective as of the day of the change in the Prime Rate.
The Contract Rate shall not at any time be less than
fifteen percent (15.00%). Interest shall be (i) calculated
on the basis of a 360 day year, and (ii) payable monthly, in
arrears, commencing on [December] 1, 2007 on the first Business
Day of each consecutive calendar month thereafter through and
including the Maturity Date, and on the Maturity Date, whether
by acceleration or otherwise.
1.2
Contract Rate Payments . The
Contract Rate shall be calculated on the last Business Day of
each calendar month hereafter (other than for increases or
decreases in the Prime Rate which shall be calculated and become
effective in accordance with the terms of Section 1.1) until the
Maturity Date and shall be subject to adjustment as set forth
herein.
1.3
Rebate . If within six (6) months
of the date of issue of this Note, the Companies prepay in full
the Principal Amount outstanding at such time together with
accrued but unpaid interest thereon and any and all other sums
due, accrued or payable to the Holder arising under this Note,
the Security Agreement or any other Ancillary Agreement
(collectively, the “Redemption Amount”) and the
Security Agreement has been terminated, upon receipt in full of
the Redemption Amount in good funds, the Holder will rebate to
the Parent fifty percent (50%) of any fees it received from the
Companies on the date of issue of this Note.
ARTICLE II
EVENTS OF DEFAULT AND DEFAULT RELATED PROVISIONS
2.1
Events of Default . The occurrence
of any Event of Default under the Security Agreement shall
constitute an event of default (“ Event of Default
”) hereunder.
2.2
Default Interest . Following the
occurrence and during the continuance of an Event of Default,
the Companies shall, jointly and severally, pay additional
interest on the outstanding principal balance of this Note in an
amount equal to two percent (2%) per month, and all outstanding
Obligations, including unpaid interest, shall continue to accrue
interest at such additional interest rate from the date of
such Event of Default until the date such Event of Default is
cured or waived.
2.3
Default Payment . Following
the occurrence and during the continuance of an Event of
Default, the Agent may demand repayment in full of all
obligations and liabilities owing by the Companies to the Holder
under this Note, the Security Agreement and/or any other
Ancillary Agreement and/or may elect, in addition to all rights
and remedies of the Agent under the Security Agreement and the
other Ancillary Agreements and all obligations and liabilities
of each Company under the Security Agreement and the other
Ancillary Agreements, to require the Companies, jointly and
severally, to make a Default Payment (“ Default
Payment ”). The Default Payment shall be one
hundred thirty percent (130%) of the outstanding principal
amount of this Note, plus accrued but unpaid interest, all other
fees then remaining unpaid, and all other amounts payable
hereunder, under the Security Agreement or any other Ancill
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