Exhibit 10-2
REVOLVING NOTE
$1,500,000.00 DALLAS, TEXAS March 27, 2007
FOR VALUE RECEIVED, the undersigned, ENVIROCLEAN MANAGEMENT SERVICES, INC.,
a Texas corporation (whether one or more, "Maker"), hereby unconditionally
promises to pay to the order of PARK CITIES BANK (together with its successors
and assigns and any subsequent holder of this Promissory Note, "Payee"), as
hereinafter provided, the principal sum of ONE MILLION FIVE HUNDRED THOUSAND AND
N0/100 DOLLARS ($1,500,000.00), or so much thereof as may be advanced by Xxxxx
from time to time hereunder to or for the benefit or account of Maker, together
with interest thereon at the rate of interest hereinafter provided, without
right of offset and otherwise in strict accordance with the terms and provisions
hereof.
1. Interest. Interest shall accrue on the principal balance from day to day
outstanding under this Revolving Note (this "Revolving Note") at a rate equal to
the lesser of: (a) the Maximum Lawful Rate (as hereinafter defined); or (b) a
fluctuating rate of interest ("Fluctuating Rate"), equal to one percent (1.0%)
in excess of the "prime rate" as announced, published and so designated in the
Money Rates Section of the Wall Street Journal from time to time. Interest on
the indebtedness evidenced by this Revolving Note shall be computed on the basis
of a three hundred sixty (360) day year and shall accrue on the actual number of
days elapsed for any whole or partial month in which interest is being
calculated. Maker hereby acknowledges that the "prime rate" may not be the
lowest rate offered by Payee to its customers from time to time. If at any time
the Fluctuating Rate exceeds the Maximum Lawful Rate, any subsequent reductions
in the Fluctuating Rate shall not reduce the rate of interest hereunder below
the Maximum Lawful Rate until the aggregate amount of accrued interest hereunder
equals the amount that would have accrued if the Fluctuating Rate had at all
times remained in full effect during the period that it exceeded the Maximum
Lawful Rate.
2. Payment. Commencing on April 1, 2007, and continuing on the first (1st)
of each successive month thereafter, monthly installments of accrued but unpaid
interest shall be due and payable. The entire outstanding principal balance
hereof and all accrued but unpaid interest shall be finally due and payable on
April 1, 2008 (the "Maturity Date"), or upon the earlier maturity hereof,
whether by acceleration or otherwise. All payments under this Revolving Note
made to Payee shall be made at Payee's banking offices in Dallas County, Texas,
or at such other place as the Payee may from time to time designate in writing,
in lawful money of the United States of America which shall be legal tender in
payment of all debts at the time of payment. Maker may prepay all or any of the
principal of this Revolving Note at any time and from time to time prior to
maturity without premium or penalty, and interest shall cease to accrue on any
amounts so prepaid, and any such prepayment of principal shall be applied in the
inverse order of maturity to the last maturing installments of principal under
this Revolving Note. Any payment, whether a regularly scheduled installment, a
prepayment or otherwise, shall be applied first to accrued but unpaid interest,
and the remainder of such payment shall be applied to the reduction of the
outstanding principal balance. Maker xxxxxx agrees to accept Xxxxx's calculation
of interest payable hereunder absent manifest mathematical error. If any payment
on this Revolving Note shall become due on a Saturday, Sunday or any other day
which is a banking holiday, such payment shall be made on the next succeeding
business day which is not a banking holiday, and such extension of time shall in
each such case be included in computing interest due hereunder.
3. Loan Agreement; Security. This Revolving Note evidences one or more
Advances made by Lender to Borrower pursuant to that certain Loan and Security
Agreement dated of even date herewith by and between, among others, Payee and
Maker (as amended, supplemented or otherwise modified in writing from time to
time, the "Loan Agreement"), and has been executed and delivered pursuant to, is
governed by, the terms and provisions of the Loan Agreement. Borrower shall be
entitled to Advances hereunder from time to time in accordance with, and subject
to the terms and conditions of, the Loan Agreement. This Note is secured by the
liens and security interests granted in the Loan Agreement, and the Deed of
Trust. Capitalized terms used herein, unless otherwise defined, shall have the
meanings given to such terms in the Loan Agreement.
4. Revolving Note. Principal amounts borrowed and repaid hereunder may be
reborrowed in accordance with the Loan Agreement, and accordingly, the gross sum
of all Advances made under this Revolving Note may exceed the Revolving Loan
Commitment, provided, however, that the outstanding principal balance hereof
shall at no time exceed the Revolving Loan Commitment. All payments of principal
under this Revolving Note shall reduce the unpaid balance of principal due
hereunder, but shall not extinguish this Revolving Note until the entire
principal balance and all accrued interest hereon has been paid in full and all
obligation of Lender to advance funds under the Loan Agreement has been
terminated.
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5. Default and Remedies. Upon the occurrence of an "Event of Default"
(herein so called), as such term is defined in the Loan Agreement, Payee shall
have the immediate right, at the sole discretion of Payee and without notice or
demand (a) to declare the entire unpaid balance of this Revolving Note and all
accrued but unpaid interest at once immediately due and payable (and the same
shall be at once immediately due and payable and the same may be collected
forthwith), (b) to foreclose and enforce all liens and security interests
securing payment hereof, and (c) to exercise any of Payee's other rights,
powers, recourses and remedies under this Revolving Note or any of the other
Loan Documents, or at law or in equity.
6. Attorneys' Fees and Costs. If Payee retains an attorney-at-law in
connection with any Event of Default or at maturity or to collect, enforce, or
defend this Revolving Note or any part hereof, or any of the other Loan
Documents, in any lawsuit or in any probate, reorganization, bankruptcy or other
proceeding, or otherwise, Maker agrees to pay all costs and expenses of
collection, including but not limited to, Xxxxx's attorneys' fees, whether or
not any legal action shall be instituted.
7. Late Charge. At the option of Payee, Maker shall pay a "late charge"
in the amount of five percent (5%) of any installment on this Revolving Note
when such installment is not paid within ten (10) days following the date such
installment is due, in order to cover the additional expenses involved in
handling delinquent payments.
8. Default Interest Rate. All past due installments of interest shall, if
permitted by applicable law, bear interest at the Maximum Lawful Rate, or if no
Maximum Lawful Rate is applicable hereto, then at the rate of eighteen percent
(18%) per annum. During the existence of any default hereunder, the entire
unpaid principal balance shall bear interest at the Maximum Lawful Rate.
9. Usury Savings Provisions. It is expressly stipulated and agreed to be
the intent of Maker and Payee at all times to comply strictly with the
applicable Texas law governing the maximum rate or amount of interest payable on
the Indebtedness (as hereinafter defined), or applicable United States federal
law to the extent that such law permits Payee to contract for, charge, take,
reserve or receive a greater amount of interest than under Texas law. For
purposes of this provision, "Indebtedness" shall mean all indebtedness evidenced
by this Revolving Note, and all amounts payable in the performance of any
covenant or obligation in any of the other Loan Documents or any other
communication or writing by or between Maker and Payee related to the
transaction or transactions that are the subject matter of the Loan Documents,
or any part of such indebtedness. If the applicable law is ever judicially
interpreted so as to render usurious any amount contracted for, charged, taken,
reserved or received in respect of the Indebtedness, including by reason of the
acceleration of the maturity or the prepayment thereof, then it is Maker's and
Xxxxx's express intent that all amounts charged in excess of the Maximum Lawful
Rate shall be automatically canceled, ab initio, and all amounts in excess of
the Maximum Lawful Rate theretofore collected by Payee shall be credited on the
principal balance of the Indebtedness (or, if the Indebtedness has been or would
thereby be paid in full, refunded to Maker), and the provisions of this
Revolving Note and the other Loan Documents shall immediately be deemed reformed
and the amounts thereafter collectible hereunder and thereunder reduced, without
the necessity of the execution of any new document, so as to comply with the
applicable laws, but so as to permit the recovery of the fullest amount
otherwise called for hereunder and thereunder; provided, however, if this
Revolving Note has been paid in full before the end of the stated term hereof,
then Maker and Payee agree that Payee shall, with reasonable promptness after
Xxxxx discovers or is advised by Maker that interest was received in an amount
in excess of the Maximum Lawful Rate, either credit such excess interest against
the Indebtedness then owing by Maker to Payee and/or refund such excess interest
to Maker. Maker hereby agrees that as a condition precedent to any claim seeking
usury penalties against Xxxxx, Maker will provide written notice to Xxxxx,
advising Payee in reasonable detail of the nature and amount of the violation,
and Payee shall have sixty (60) days after receipt of such notice in which to
correct such usury violation, if any, by either refunding such excess interest
to Maker or crediting such excess interest against the Indebtedness then owing
by Maker to Payee. All sums contracted for, charged, taken, reserved or received
by Payee for the use, forbearance or detention of the Indebtedness shall, to the
extent permitted by applicable law, be amortized, prorated, allocated or spread,
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using the actuarial method, throughout the stated term of this Revolving Note
(including any and all renewal and extension periods) until payment in full so
that the rate or amount of interest on account of the Indebtedness does not
exceed the Maximum Lawful Rate from time to time in effect and applicable to the
Indebtedness for so long as debt is outstanding. In no event shall the
provisions of Chapter 346 of the Texas Finance Code (which regulates certain
revolving credit loan accounts and revolving triparty accounts) apply to this
Revolving Note or any other part of the Indebtedness. Notwithstanding anything
to the contrary contained herein or in any of the other Loan Documents, it is
not the intention of Payee to accelerate the maturity of any interest that has
not accrued at the time of such acceleration or to collect unearned interest at
the time of such acceleration. The terms and provisions of this paragraph shall
control and supersede every other term, covenant or provision contained herein,
in any of the other Loan Documents or in any other document or instrument
pertaining to the Indebtedness.
10. Maximum Lawful Rate; Ceiling Election. As used herein, the term
"Maximum Lawful Rate" shall mean the maximum lawful rate of interest which may
be contracted for, charged, taken, received or reserved by Payee in accordance
with the applicable laws of the State of Texas (or applicable United States
federal law to the extent that such law permits Payee to contract for, charge,
take, receive or reserve a greater amount of interest than under Texas law),
taking into account all fees, charges and any other value whatsoever made in
connection with the transaction evidenced by this Revolving Note and the other
Loan Documents. To the extent that Payee is relying on Chapter 303 of the Texas
Finance Code to determine the Maximum Lawful Rate payable on the Revolving Note
or any other part of the Indebtedness (hereinafter defined), Payee will utilize
the weekly ceiling from time to time in effect as provided in such Chapter 303,
as amended. To the extent United States federal law permits Payee to contract
for, charge, take, receive or reserve a greater amount of interest than under
Texas law, Payee will rely on United States federal law instead of such Chapter
303 for the purpose of determining the Maximum Lawful Rate. Additionally, to the
extent permitted by applicable law now or hereafter in effect, Payee may, at its
option and from time to time, utilize any other method of establishing the
Maximum Lawful Rate under such Chapter 303 or under other applicable law by
giving notice, if required, to Maker as provided by such applicable law now or
hereafter in effect.
11. Waiver. EXCEPT AS SPECIFICALLY PROVIDED IN THE LOAN DOCUMENTS TO THE
CONTRARY, MAKER AND ANY SURETY, ENDORSER OR GUARANTOR OF THIS REVOLVING NOTE
SEVERALLY AND EXPRESSLY (A) WAIVE AND RELINQUISH PRESENTMENT FOR PAYMENT,
DEMAND, NOTICE OF NONPAYMENT OR NONPERFORMANCE, PROTEST, NOTICE OF PROTEST,
NOTICE OF INTENT TO ACCELERATE, NOTICE OF ACCELERATION, GRACE, DILIGENCE IN
COLLECTING THIS REVOLVING NOTE OR ENFORCING ANY SECURITY THEREFOR, OR ANY OTHER
NOTICES OR ANY OTHER ACTION, AND (B) CONSENT TO ALL RENEWALS, EXTENSIONS,
REARRANGEMENTS AND MODIFICATIONS WHICH FROM TIME TO TIME MAY BE GRANTED BY PAYEE
WITHOUT NOTICE AND TO ALL PARTIAL PAYMENTS HEREON, WHETHER BEFORE OR AFTER
MATURITY, WITHOUT PREJUDICE TO PAYEE. PAYEE SHALL SIMILARLY HAVE THE RIGHT TO
DEAL IN ANY WAY, AT ANY TIME, WITH ONE OR MORE OF THE FOREGOING PARTIES WITHOUT
NOTICE TO ANY OTHER PARTY, AND TO GRANT ANY SUCH PARTY ANY EXTENSIONS OF TIME
FOR PAYMENT OF ANY OF SAID INDEBTEDNESS, OR TO GRANT ANY OTHER INDULGENCES OR
FORBEARANCES WHATSOEVER, WITHOUT NOTICE TO ANY OTHER PARTY AND WITHOUT IN ANY
WAY AFFECTING THE PERSONAL LIABILITY OF ANY PARTY HEREUNDER.
12. Governing Law and Venue. THIS REVOLVING NOTE IS EXECUTED AND DELIVERED
IN CONNECTION WITH A LENDING TRANSACTION NEGOTIATED AND CONSUMMATED IN DALLAS
COUNTY, TEXAS, AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF TEXAS. MAKER, FOR ITSELF AND ITS SUCCESSORS AND ASSIGNS,
HEREBY IRREVOCABLY (A) SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE STATE AND
FEDERAL COURTS IN TEXAS, (B) WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION THAT IT MAY NOW OR IN THE FUTURE HAVE TO THE LAYING OF VENUE OF ANY
LITIGATION ARISING OUT OF OR IN CONNECTION WITH THIS REVOLVING NOTE OR ANY OF
THE OTHER LOAN DOCUMENTS BROUGHT IN THE DISTRICT COURT OF DALLAS COUNTY, TEXAS,
OR IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF TEXAS,
DALLAS DIVISION, (C) WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE
VENUE OF ANY SUCH ACTION OR PROCEEDING BROUGHT IN SUCH COURT OR THAT SUCH COURT
IS AN INCONVENIENT FORUM, AND (D) AGREES THAT ANY LEGAL PROCEEDING AGAINST ANY
PARTY TO ANY OF THE LOAN DOCUMENTS ARISING OUT OF OR IN CONNECTION WITH ANY OF
THE LOAN DOCUMENTS MAY BE BROUGHT IN ONE OF THE FOREGOING COURTS.
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13. Waiver of Jury Trial. MAKER, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, HEREBY KNOWINGLY, INTENTIONALLY, IRREVOCABLY, UNCONDITIONALLY
AND VOLUNTARILY, WITH AND UPON THE ADVICE OF COMPETENT COUNSEL, WAIVES,
RELINQUISHES AND FOREVER FORGOES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION OR
PROCEEDING BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATING TO THIS REVOLVING
NOTE OR ANY OF THE LOAN DOCUMENTS, OR ANY CONDUCT, ACT OR OMISSION OF PAYEE OR
MAKER, OR ANY OF THEIR DIRECTORS, OFFICERS, PARTNERS, MEMBERS, EMPLOYEES, AGENTS
OR ATTORNEYS, OR ANY OTHER PERSONS AFFILIATED WITH PAYEE OR MAKER, OR ANY OF
THEIR DIRECTORS, OFFICERS, PARTNERS, MEMBERS, EMPLOYEES, AGENTS OR ATTORNEYS, OR
ANY OTHER PERSONS AFFILIATED WITH PAYEE OR MAKER, IN EACH OF THE FOREGOING
CASES, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE.
14. Notices. Any notice or demand required hereunder shall be deemed to be
delivered when deposited in the United States mail, postage prepaid, certified
mail, return receipt requested, addressed to Maker or Payee, as the case may be,
at the address set out hereinbelow, or at such other address as such party may
hereafter deliver in accordance herewith. Any other method of delivery or demand
shall be effective only when actually received by the recipient thereof. If and
when included within the term "Maker" or "Payee" there is more than one person,
all shall jointly arrange among themselves for their joint execution and
delivery of a notice to the other specifying some person at some specific
address for the receipt of all notices, demands, payments or other documents.
All persons included within the terms "Maker" or "Payee," respectively, shall be
bound by notices, demands, payments and documents given in accordance with the
provisions of this paragraph to the same extent as if each had received such
notice, demand, payment or document.
15. Successors and Assigns. This Revolving Note and all the covenants,
promises and agreements contained herein shall be binding upon and shall inure
to the benefit of Maker and Payee, and their respective successors and assigns.
16. Time is of the Essence. Time is of the essence with respect to all
provisions of this Revolving Note and the other Loan Documents.
17. Joint and Several Liability. Should this Revolving Note be signed or
endorsed by more than one person and/or entity, all of the obligations herein
contained shall be considered the joint and several obligations of each maker
and endorser hereof.
18. Termination. This Revolving Note may not be terminated orally, but only
by a discharge in writing signed by Xxxxx at the time such discharge is sought.
REMAINDER OF XXXX LEFT BLANK - SIGNATURE PAGE FOLLOWS
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EXECUTED effective as of the day and year first written above.
MAKER:
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ENVIROCLEAN MANAGEMENT SERVICES, INC.,
a Texas corporation
By: /s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx, President
ADDRESSES FOR NOTICES
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PAYEE: MAKER:
PARK CITIES BANK ENVIROCLEAN MANAGEMENT SERVICES, INC.
0000 X. Xxxxxxxxxxx Xxxx, Xxxxx 000 00000 Xxxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000 Xxxxxx, Xxxxx 00000
Attn: Xxxx Xxxxxxx Attn: Xxxxxxx X. Xxxxxxx
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