Exhibit 6.2
peoples bank VARIABLE RATE
& Trust Company COMMERCIAL
000 X. Xxxxxx Xxxxxx XXXXXXXXX XX
Xxxxxxxxxxxx, XX 00000 DRAW NOTE
(000) 000-0000
"LENDER"
Borrower: Browsesafe, L.L.C.
000 X. 0xx Xxxxxx, Xxx 000
Xxxxxxxxxxxx, XX 00000
Tel: (000) 000-0000
ID #: ###-##-####
Officer Interest Principal Funding/ Maturity Customer Loan
Initials Rate Amount/ Agreement Date Number Number
Credit Line Date
CRF Variable $200,000.00 11/09/98 11/09/99 691585
PROMISE TO PAY: For value received, Xxxxxxxx promises to pay to the order of
Lender indicated above the principal amount of Two Hundred Thousand and no/100
Dollars ($200,000.00), or if less, the aggregate unpaid principal amount of all
loans or advances made by the Lender to the Borrower, plus interest on the
unpaid principal balance and those other charges permitted by applicable law and
authorized pursuant to this Note, all without relief for valuation and
appraisement laws, all at the rate and in the manner described below, until all
amounts owing under this Note are paid in full. All amounts received by Xxxxxx
shall be applied first to late payment charges, then to expenses, then to
accrued unpaid interest, and then to unpaid principal or in an other manner as
determined by Xxxxxx, in Xxxxxx's sole discretion, as permitted by law.
REVOLVING OR DRAW FEATURE: X The Note possesses a revolving feature. Upon
satisfaction of the conditions set forth in this Note, Borrower shall be
entitled to borrow up to the full principal amount of the Note and to repay and
reborrow from time to time during the term of this Note. ___ This Note possesses
a draw feature. Upon satisfaction of the conditions set forth in this Note,
Borrower shall be entitled to make one or more draws under this Note. Any
repayment may not be reborrowed. The aggregate amount of such draw shall not
exceed the full principal amount of this Note. Information with regard to any
loans or advances under this Note shall be recorded and maintained by Lender in
its internal records and such records shall be conclusive as to the information
set forth therein absent manifest error. The Lender's failure to record the date
and amount of any loan or advance shall not limit or otherwise affect the
obligations of the Borrower under this Note to repay the principal amount of the
loans or advances together with all interest accruing thereon. Lender shall not
be obligated to provide Borrower with a copy of the record on a periodic basis.
Borrower shall be entitled to inspect or obtain a copy of the record during
Xxxxxx's business hours.
CONDITIONS FOR ADVANCES: If there is no default under this Note, Borrower shall
be entitled to borrow monies under this Note (subject to the limitation
described above) under the following conditions:
INTEREST RATE: This Note has a variable rate feature. The interest rate on this
Note may change from time to time if the Index Rate identified below changes.
Interest shall be computed on the basis of 360 days and the actual number of
days per year. Interest on this Note shall be calculated and payable at a
variable rate equal to (0.000%) per annum over the Index Rate. The initial Index
Rate is currently (8.000%) percent per annum. The initial interest rate on this
Note shall be (8.000%) per annum. Any change in the interest rate resulting from
a change in the Index Rate will be effective on: The date the Index Rate
changes.
The minimum interest rate on this Note shall be (___n/a%) per annum. The maximum
interest rate on this Note shall not exceed (____n/a%) per annum, or if less, or
if a maximum rate is not indicated, the maximum interest rate Lender is
permitted to charge by law.
INDEX RATE: The Index Rate for this Note shall be: Lender's Base or Reference
Rate, which Lender may increase or decrease at any time in Lender's discretion,
is publicly available, and which may not necessarily reflect the rate Lender
charges to its other customers which may be lower. If the Index Rate is
redefined or becomes unavailable, then Lender may select another index which is
substantially similar.
DEFAULT RATE: In the event of any default under this Note, the Lender may, in
its discretion, increase the interest rate on this Note to 4% above the Index
Rate or the maximum interest rate Lender is permitted to charge by law,
whichever is less.
PAYMENT SCHEDULE: Borrower shall pay the principal and interest according to the
following schedule:
Interest only payments beginning February 9, 1999 and continuing at quarterly
time intervals thereafter. A final payment of the unpaid principal balance plus
accrued interest is due and payable on November 9, 1999.
All payments will be made to Lender at any address so designated by Lender and
in lawful currency of the United States of America.
RENEWAL: If checked, ___ this Note is a renewal of Loan Number_______________.
SECURITY: To secure the payment and performance of obligations incurred under
this Note, Borrower grants Lender a security interest in all of Borrower's
rights, title, and interest, in all monies, instruments, savings, checking and
other deposit accounts of Borrower's (excluding IRA, Xxxxx and trust accounts
and deposits subject to tax penalties if so assigned) that are now or in the
future in Xxxxxx's custody or control. X If checked, the obligations under this
Note are also secured by a lien on and/or security interest in the property
described in the security instruments executed in connection with this Note as
well as any other property designated as security for the Note now or in the
future.
PREPAYMENT: This Note may be prepaid in part or in full on or before its
maturity date. All prepayments will be credited as determined by Xxxxxx and as
permitted by law. If this Note is prepaid in full, there will be X No minimum
finance charge or prepayment penalty. ____ A minimum finance charge of
$________. _____ A prepayment penalty of :_____
LATE PAYMENT CHARGE: If a payment is more than 10 days late, Borrower will be
charged a late payment charge of: ____% of the unpaid late payment; X $100.00 or
5% of the unpaid late payment; whichever is ___ greater X less.
XXXXXXXX ACKNOWLEDGES THAT XXXXXXXX HAS READ, UNDERSTANDS AND AGREES TO THE
TERMS AND CONDITIONS OF THIS NOTE, INCLUDING THE PROVISIONS ON THE REVERSE SIDE.
BORROWER ACKNOWLEDGES RECEIPT OF AN EXACT COPY OF THIS NOTE.
DATE: NOVEMBER 9, 1998
BORROWER: XXXXXXXXXX, L.L.C. BORROWER: XXXXXXXXXX, L.L.C.
BY: /S/ XXXX X. XXXXX BY: /S/ XXXXXXX X. XXXXXXXX
---------------------------- --------------------------
XXXX X. XXXXX, PRESIDENT XXXXXXX X. XXXXXXXX
CHIEF FINANCIAL OFFICER
TERMS AND CONDITIONS
1. DEFAULT: Borrower will be in default under this Note in the event that
Borrower, any guarantor or any other third party pledging collateral to
secure this Note:
a) fails to make any payment on this Note or any other indebtedness to
Lender when due;
b) fails to perform any obligation or breaches any warranty or covenant to
Lender contained in this Note, any security instrument, or any other
present or future written agreement regarding this or any other
indebtedness of Borrower to Lender;
c) provides or causes any false or misleading signature or representation
to be provided to the Lender;
d) sells, conveys or transfers rights in any collateral securing this Note
without the written approval of Xxxxxx, destroys, loses or damages such
collateral in any material respect, or subjects such collateral to
seizure or confiscation;
e) has a garnishment, judgment, tax levy, attachment or lien entered or
served against Borrower, any guarantor, or any third party pledging
collateral to secure this Note or any of their property;
f) dies, becomes legally incompetent, is dissolved or terminated, ceases to
operate its business, becomes insolvent, makes an assignment for the
benefit of creditors, fails to pay debts as they become due, or becomes
the subject of any bankruptcy, insolvency or debtor rehabilitation
proceeding; or
g) causes Lender to deem itself insecure due to a significant decline in
the value of any real or personal property securing payment of this
Note, or Lender in good faith, believes the prospect of payment or
performance is impaired.
2. RIGHTS OF LENDER ON DEFAULT: If there is a default under this Note, Lender
will be entitled to exercise one of the following remedies without notice or
demand (except as required by law):
a) to declare the principal amount plus accrued interest under this Note
and all other present and future obligations of Borrower immediately due
and payable in full;
b) to collect the outstanding obligations of Borrower with or without
resorting to the judicial process;
c) to cease making advances under this Note or any other agreement between
Borrower and Lender;
d) to take possession of any collateral in any manner permitted by law;
e) to require Borrower to deliver and make available to Lender any
collateral at a place reasonably convenient to Borrower and Lender;
f) to sell, lease or otherwise dispose of any collateral and collect any
deficiency balance with or without resorting to legal process;
g) to set-off Borrower's obligations against any amounts due to Borrower
including, but not limited to monies, instruments and deposit accounts
maintained with Lender; and
h) to exercise all other rights available to Lender under any other written
agreement or applicable law.
Upon default in any covenant or agreement providing for the payment of taxes,
the maintenance of insurance, or otherwise relating to the collateral securing
Borrower's obligations to Lender, Lender may, in its sole discretion, advance
such sums and costs and take such other steps as Lender may deem necessary or
advisable to protect any collateral. All sums so advanced or paid by Xxxxxx
shall be payable by Borrower to Lender, and shall be part of Borrower's
obligations to Lender. Xxxxxx's rights are cumulative and may be exercised
together, separately, and in any order. Xxxxxx's remedies under this paragraph
are in addition to these available at common law, including, but not limited to,
the right of set-off.
3. DEMAND FEATURE: ___ If checked, this Note contains a demand feature.
Xxxxxx's right to demand payment at any time, and from time to time, shall
be in Lender's sole and absolute discretion, whether or not any default has
occurred.
4. FINANCIAL INFORMATION: Borrower will at all times keep proper books of
record and account in which full, true and correct entries shall be made in
accordance with generally accepted accounting principles and will deliver to
Lender, within ninety (90) days after the end of each fiscal year of
Borrower, a copy of the annual financial statements of Borrower relating to
such fiscal year, such statements to include (1) the balance sheet of
Borrower as at the end of such fiscal year and (2) the related income
statement, statement of retained earnings and statement of changes in the
financial position of Borrower for such fiscal year, prepared by such
certified public accounts as may be reasonably satisfactory to Lender.
Xxxxxxxx also agrees to deliver to Lender within fifteen (15) days after
filing same, a copy of Xxxxxxxx's income tax returns and also, from time to
time, such other financial information with respect to Borrower as Xxxxxx
may request. Borrower shall permit Xxxxxx's representatives to inspect
Borrower's properties and its books and records, and to make copies or
abstracts thereof.
5. MODIFICATION AND WAIVER: The modification or waiver of any of Borrower's
obligations or Xxxxxx's rights under this Note must be contained in writing
by Xxxxxx. Lender may perform any of Borrower's obligations or delay or fail
to exercise any of the rights without causing a waiver of those obligations
or rights. A waiver on one occasion will not constitute a waiver on any
other occasion. Borrower's obligations under this Note shall not be affected
if Lender amends, compromises, exchanges, fails to exercise, impairs or
releases any of the obligations belonging to any co-borrower or guarantor of
any of its rights against any co-borrower, guarantor or collateral.
6. SEVERABILITY: If any provision of this Note is invalid, illegal or
unenforceable, the validity, legality, and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
7. ASSIGNMENT: Borrower will not be entitled to assign any of its rights,
remedies, or obligations described in this Note without the prior written
consent of Lender which may be withheld by Xxxxxx in its sole discretion.
Lender will be entitled to assign some or all of its rights and remedies
described in this Note without notice to or the prior consent of Borrower in
any manner.
8. NOTICE: Any notice or other communication to be provided to Borrower or
Lender under this Note shall be in writing and sent to the parties at the
addresses described in this Note or such other address as the parties may
designate in writing from time to time.
9. APPLICABLE LAW: This Note shall be governed by the laws of the State of
Indiana. Unless applicable law provides otherwise, Borrower consents to the
jurisdiction and venue of any court selected by Lender in its discretion
located in such state in the event of any legal proceeding under this Note.
10. COLLECTION COSTS: To the extent permitted by law, Xxxxxxxx agrees to pay
collection costs, expenses and reasonable attorneys fees and costs, incurred
by Xxxxxx in collecting any amount due or enforcing any right or remedy
under this Note whether or not suit is brought, including but not limited
to, expenses, fees, and costs incurred for collection, enforcement,
realization or collateral, construction, interpretation, and appearance in
collection, bankruptcy, insolvency, reorganization, post-judgment and
appellate proceedings.
11. CHECK PROCESSING FEE: If a check, draft, order, or like instrument for
payment is dishonored or returned to Lender for any reason, Lender will
assess a check processing fee of $22.00 plus an amount equal to the actual
charge by the depository institution returning or dishonoring the
instrument.
12. MISCELLANEOUS: This Note and the obligations incurred by Borrower are
commercial obligations to finance income-producing business or activity, and
not for personal, family or household purposes. Xxxxxxxx and Xxxxxx agree
that time is of the essence. Borrower and any person who endorses this Note
waives presentment, demand for payment, notice of dishonor and protest and
further waives any right (if any) to require Lender to proceed against
anyone else before proceeding against Borrower or said person. All
references to Borrower in this Note shall include all of the parties signing
this Note, and this Note shall be binding upon the heirs, successors and
assigns of Xxxxxxxx and Xxxxxx. If there is more than one Borrower, their
obligations under this Note shall be joint and several. This Note represents
the complete and integrated understanding between Borrower and Lender
regarding the terms hereof.
13. JURY TRIAL WAIVER: XXXXXX AND BORROWER HEREBY WAIVE ANY RIGHT TO A TRIAL BY
JURY IN A CIVIL ACTION ARISING OUT OF, OR BASED UPON, THIS NOTE OR THE
COLLATERAL SECURING THIS NOTE.
14. ADDITIONAL TERMS: LOAN PURPOSE IS WORKING CAPITAL TO SUPPORT INTRODUCTION OF
NEW SOFTWARE PRODUCTS, PENDING RECEIPT OF PAYMENTS FROM MIDDLEGATE
FINANCIAL. SECURED BY SECURITY AGREEMENT DATED 11/09/98 COVERING ALL
BUSINESS ASSETS LIMITED GUARANTY OF $50,000.00 FOR XXXX X. XXXXX AND LIMITED
GUARANTY OF $40,000.00 EACH FOR XXXXXXX X. XXXXXXXX, XXX X. X'XXXXX AND X.
XXXXXXXX XXXX XXXXXXX.
