REVOLVING PROMISSORY NOTE
Salt Lake City, Utah November 15, 2002
FOR VALUE RECEIVED, the undersigned, VOYAGER ENTERTAINMENT INTERNATIONAL,
INC., a North Dakota corporation ("Maker"), hereby promises to pay to the order
of DAN FUGAL, an individual (together with his successors and assigns,
("Holder"), the principal sum not to exceed TWO MILLION FIVE HUNDRED THOUSAND
DOLLARS (U.S. $2,500,000.00) or the aggregate unpaid principal amount of all
advances or re-advances by the Maker pursuant to a pursuant to that certain loan
agreement entitled "Loan and Security Agreement," (the "Loan Agreement")
executed on even date, and to repay the outstanding aggregate unpaid principal
amount, plus a lump-sum interest payment of TWO MILLION FIVE HUNDRED THOUSAND
DOLLARS AND NO CENTS (U.S. $2,500,000.00) when the Development Financing has
been fully funded by RRI for Borrower, as defined in the Loan Agreement, or when
sufficient funding of Development Financing has been secured so the escrow funds
can be released, as defined in the Loan Agreement, or on or before February 15,
2003, whichever is sooner. All payments of principal and interest shall be made
at Holders offices located at 1005 South Main Street, Pleasant Grove, UT 84062,
or at such other places as the Holder may designate to Maker in writing.
TERMS AND CONDITIONS
1. Payments. If any payment on this Revolving Promissory Note becomes due
and payable on a Saturday, Sunday or business holiday in the State of Utah,
payment shall be made on the next successive business day with the same effect
as though made on the due date.
2. Prepayment. The Maker reserves the right to prepay the entire principal
balance and accrued interest of this Revolving Promissory Note at any time.
3. Warranties, Representations and Covenants. The Maker represents,
warrants and covenants that:
3.1. Maker is a corporation in good standing under the laws if the
State of North Dakota.
3.2. There are no actions, suits or proceedings pending or, to the
knowledge of the Maker, threatened against or affecting the Maker in any court
or before any governmental department or agency which might result in any
material adverse change in the financial condition of the Maker. The Maker does
not now have and will not during the term of this Revolving Promissory Note have
any contingent liabilities known to the Maker.
4. Events of Default. Any one or more of the following shall be events of
default under the terms of this Revolving Promissory Note (hereinafter called
"events of default"):
4.1. Failure to make any payment under the Revolving Promissory Note
when due, except the payment of interest due at maturity, and such failure to
pay remains uncured for thirty (30) calendar days after written notice that the
payment is delinquent made by Holder.
4.2. Failure to pay the principal due and accrued and outstanding
interest on or before January 31, 2003 and such failure to pay remains uncured
for thirty (30) calendar days after written notice that the payment is
delinquent made by Holder.
4.3. Default shall be made in due observance or performance of any
other agreement or covenant contained in this Revolving Promissory Note, the
Loan Agreement or the Pledge Agreement securing, in part or whole, this
Revolving Promissory Note.
4.4. Any warranty, representation, agreement or statement made or
furnished to the Holder by or on behalf of the Maker proves to have been false
in any material respect when made or furnished.
4.5. Any court of competent jurisdiction shall make an order not
vacated or stayed within sixty (60) days from the date of entry thereof (1)
adjudicating the Maker a bankrupt, (2) appointing a trustee or receiver of the
Maker or of any substantial part of its properties, or (3) approving a petition
for, or effecting, an arrangement in bankruptcy, a reorganization pursuant to
the United Stated Bankruptcy Code, as amended, or any other judicial
modification or alteration of the rights of the Holder or of other creditors
against the Maker.
4.6. The Maker shall itself (1) institute a proceeding under any
bankruptcy, insolvency, reorganization or other law relating to the relief of
debtors, including without limitation, the United States Bankruptcy code, as
amended, or (2) consent to any judicial modification or alteration of the rights
of the Holder or of other creditors against the Maker.
4.7. The Maker shall make an assignment for the benefit of its
creditors or shall generally fail to pay its debts as they come due.
5. Acceleration. Upon the occurrence of one or more events of default and
at any time thereafter, the Holder may by notice in writing to the Maker declare
the entire principal amount of this Revolving Promissory Note to be, and the
entire principal amount of this Revolving Promissory Note shall thereupon become
immediately due and payable in full together with interest accrued thereon.
6.1. No delay or failure of the Holder in exercising any right,
power, privilege or remedy hereunder, the Loan Agreement or the Pledge Agreement
securing this Revolving Promissory Note shall affect such right, power,
privilege or remedy or be deemed to be a waiver of the same or any party
thereof; nor shall any single or partial exercise thereof or any failure to
exercise the same in any instance preclude any further or future exercise
thereof, or the exercise of any other right, power, privilege or remedy; and the
rights, powers, privileges and remedies provided for hereunder are cumulative
and not exclusive.
6.2. The Maker, for itself and for any guarantors, sureties,
endorsers and/or any other person or persons now or hereafter liable hereon, or
any, hereby waives demand of payment, presentments for payment, protest, notice
of nonpayment or dishonor and any and all other notices and demands whatsoever,
and any and all delays or lack of diligence in the collection hereof, and
expressly consents and agrees to any and all extensions or postponements of the
time of payment hereof from time to time at or after maturity and any other
indulgence and waives all notice thereof.
7. Cumulative Remedies. All rights and remedies of the Holder whether or
not granted hereunder shall be cumulative and may be exercised singularly or
8. Notices. All notices, requests, demands and other communications
required or permitted under this Agreement shall be in writing and shall be
deemed to have been duly given, made and received when delivered against receipt
or when deposited in the United States mails, first class postage prepaid,
addressed as set forth below.
If to Maker: Dan Fugal
1005 South Main Street
Pleasant Grove, UT 84062
With copies to:
6440 South Wasatch Blvd.
Salt Lake City, UT 84117
If to Holder: Voyager Entertainment International, Inc.
4483 West Reno Avenue
Las Vegas, NV 89118
Attn.: Richard Hannigan, Sr.
Any party may alter the address to which communications or copies are to be sent
by giving notice of such change of address in conformity with the provisions of
this paragraph for the giving of notice.
9. Severability and Enforceability. Any provision of this Revolving
Promissory Note which shall be held to be inoperative for any reason, shall be
ineffective and inapplicable; but shall not invalidate the remaining provisions
hereof or the liens herein created.
10. Attorneys' Fees and Costs. Each person liable hereon agrees to pay all
reasonable costs of collection, including attorneys' fees, paid or incurred by
the Holder in enforcing this Revolving Promissory Note on default or the rights
and remedies herein provided.
11. Authority. By executing this Revolving Promissory Note on behalf of
the Maker, the undersigned member(s) of the Maker, in his personal and
individual capacities, represent to the Holder that such member(s) are duly
authorized and empowered to execute and deliver this Revolving Promissory Note
on behalf of the Makers and that this Revolving Promissory Note constitutes the
legal and binding obligation of the Maker, enforceable against the Maker in
accordance with its terms.
12. Other Loan Documents. This Revolving Promissory Note is further
evidenced by a Loan Agreement between the Maker and Holder dated November 15,
2002 and secured by a Pledge Agreement between Holder and Tracy Jones dated
November 15, 2002.
14. Jurisdiction and Governing Law. This Revolving Promissory Note was
negotiated in Utah. Maker agrees to submit to the jurisdiction of a court in
Utah to resolve disputes arising under this Revolving Promissory Note. This
Revolving Promissory Note shall be construed and governed by the terms of Utah
IN WITNESS WHEREOF, the undersigned has duly caused this Revolving
Promissory Note to be executed and delivered as of the date first written above.
VOYAGER ENTERTAINMENT INTERNATIONAL,
INC., a North Dakota
By /s/ Richard Hannigan