EXHIBIT 4.5
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, AND MUST BE HELD INDEFINITELY
UNLESS SO REGISTERED OR TRANSFERRED IN A TRANSACTION
EXEMPT FROM REGISTRATION.
PROMISSORY NOTE
$ New York, New York
_______________ ___________ , 1996
FOR VALUE RECEIVED, the undersigned, AMERICAN INTERNATIONAL PETROLEUM
CORPORATION (the "Company" or "Maker"), promises to pay to the order of
________________ ("Payee"), its successors and assigns, at Xxxxx's office at
_____, or such other place as the holder may designate in writing from time to
time, the principal sum of __________($_______ ), in lawful money of the United
States, together with simple interest in the amount of 8% of such principal sum.
All outstanding principal and interest on this Note shall be due and payable on
__________, 1997; provided, however, that the Company shall pay to the holder of
this Promissory Note and the holders of all other Promissory Notes issued in
connection with the Company's offering dated November 6, 1996 of an aggregate of
up to $1,600,000 principal amount of Subordinated Notes and 640,000 Warrants
exercisable into 640,000 Shares of Common Stock (the "Offering"), on a pro-rata
basis, to the extent of any principal and accrued interest outstanding thereon,
the net cash proceeds in excess of $1.5 million received on or prior to January
7, 1997 and all net cash proceeds received thereafter from any source of
additional financing, other than (i) the Offering, (ii) the refinancing of any
existing financing to the extent the Company does not receive additional net
proceeds therefrom and (iii) Capitalized Leases, as defined below, provided,
however that the Company does not receive any cash proceeds therefrom which are
not used in connection with the property to which such Capitalized Lease
relates.
The Company covenants that it will not at anytime while this Note is
outstanding, have encumbrances on or grant security interests in the Company's
refinery (the "Refinery") located in Lake Charles, Louisiana, except for
Permitted Liens, as defined below, in excess of Four Million Dollars without the
express written consent of 51% in interest of the Notes issued in connection
with the Offering to the extent outstanding and Xxxxxx X. Xxxxx & Co., Inc.
Subject to the rights of the holders of the Senior Debt, as defined below, and
as otherwise expressly provided herein, the Company's breach of this covenant
will result in the immediate acceleration of the amounts due hereunder.
This Note may be prepaid in whole or in part at any time and from time
to time without premium or penalty. All prepayments on this Note and all notes
of like tenor issued to other noteholders by the Company with respect to the
Offering shall be applied pro rata in the same
proportion that the original principal amount of this Note and each such note
bears to the aggregate original principal amount of all such notes, and in the
case of this Note, such prepayments shall be applied first to the payment of any
costs of collection that may be due hereunder, then to the payment of interest,
and the balance shall be applied to principal.
Other than pursuant to registration under federal and any applicable
state securities laws or any exemption from such registration, the availability
of which the Company shall determine in its sole discretion, this Note may not
be sold, pledged, assigned or otherwise disposed of (whether voluntarily or
involuntarily). The Company may condition such sale, pledge, assignment or other
disposition on the receipt from the party to whom this Note is to be so
transferred of any representations and agreements requested by the Company in
order to permit such transfer to be made pursuant to exemptions from
registration under federal and applicable state securities laws. Xxxxx, by
acceptance hereof, agrees to give written notice to the Company, before
transferring this Note, of Xxxxx's intention to do so, describing the manner of
any proposed transfer. Within thirty (30) days after receiving such written
notice, the Company shall notify Payee as to whether such transfer may be
effected and of the conditions to any such transfer.
The Maker hereby agrees, and the holder of this Note by the holder's
acceptance hereof agrees, that the payment of the principal of and interest on
this Note is hereby expressly made subordinate and junior in right of payment to
the prior payment in full of all Senior Debt, Capitalized Leases or Permitted
Liens, (each as hereinafter defined) of the Maker. The holder of this Note
agrees, as part of such subordination, as follows:
(a) In the event of insolvency or bankruptcy proceedings, or
any receivership, liquidation, reorganization or other similar proceedings in
connection therewith, relative to the Maker or to any of the property of the
Maker, or in the event of any proceedings for voluntary liquidation, dissolution
or other winding-up of the Maker, whether or not involving insolvency or
bankruptcy, then the holders of Senior Debt, Capitalized Leases and Permitted
Liens shall be entitled to receive payment in full of all principal of and
premium, if any, and interest on all Senior Debt, Capitalized Leases and
Permitted Liens before the holder of this Note shall be entitled to receive any
payment on account of principal or interest on this Note, and to that end the
holders of Senior Debt shall be entitled to receive for application in payment
thereof any payment or distribution of any kind or character, whether in cash or
property or securities, which may be payable or deliverable in any such
proceedings in respect of this Note.
(b) In the event that the holder of this Note shall have
received written notice to the effect that an event of default shall have
occurred on any Senior Debt, Capitalized Leases or Permitted Liens and be
continuing (under circumstances in which the provisions of the foregoing
paragraph (a) are not applicable), then, during the continuance of any such
event of default, all principal of and premium, if any, and interest on all
Senior Debt Capitalized Leases or Permitted Liens outstanding at the time of
such notice shall first be paid in full, before any payment on account of
principal or interest is made upon this Note.
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The provisions of this paragraph are for the purpose of defining the
relative rights of the holders of Senior Debt, Capitalized Leases or Permitted
Liens on the one hand, and the holder of this Note on the other hand, against
the Maker and its property; and nothing herein shall impair, as between the
Maker and the holder of this Note, the obligation of the Maker, which is
unconditional and absolute, to pay to the holder hereof the principal hereof and
the interest hereon in accordance with the terms and provisions hereof; nor
shall anything herein prevent the holder of this Note from exercising all
remedies otherwise permitted by applicable law upon default under this Note,
subject to the rights, if any, under this paragraph of holders of Senior Debt,
Capitalized Leases or Permitted Liens to receive cash, property, stock or
obligations otherwise payable or deliverable to the holder of this Note.
For the purpose of this Note:
(a) "Debt" of any corporation shall mean, at any date, all
indebtedness of such corporation which would, in accordance with generally
accepted accounting principles, be classified as indebtedness, whether funded or
current, but in any event including:
(i) all indebtedness guaranteed, directly or
indirectly, in any manner by such corporation or in effect guaranteed directly
or indirectly by such corporation through an agreement, contingent or otherwise,
to supply funds to or in any other manner invest in the debtor, to purchase
indebtedness or to purchase goods, supplies or services for the purpose of
enabling the debtor to make payment of the indebtedness or to assure the owner
of the indebtedness against loss, or otherwise;
(ii) all indebtedness for the payment of purchase
of which such corporation has agreed, contingently or otherwise, to advance or
supply funds;
(ii) all indebtedness secured by any mortgage, lien,
pledge, charge or encumbrance of any kind upon property owned by such
corporation, even though such corporation has not assumed or become liable for
the payment of such indebtedness; and
(iv) all indebtedness of such corporation created
or arising under any conditional sale or other title retention agreement with
respect to property acquired by such corporation, even though the rights and
remedies of the seller or lender under such agreement in the event of default
are limited to repossession of such property; and
(b) "Senior Debt" shall mean the principal of and interest on
Debt outstanding for money borrowed by the Maker from any bank, insurance
company or other institutional lender before or after the date of this Note
created or evidenced by notes, bonds, debentures or similar instruments or by a
loan agreement or loan agreements under which the indebtedness is reflected in a
loan account and all purchase money Debt incurred by the Maker before or after
the date of this Note created or evidenced by notes, bonds, mortgages, deeds of
trust or similar instruments (excluding any of such Debt which by the terms of
the instrument creating or evidencing the same is subordinated to or pari passu
with this Note).
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(c) "Capitalized Lease" shall mean items of equipment or
machinery acquired by the Maker so long as the lender's security is limited to
such equipment or machinery, and any proceeds from the sale thereof.
(d) "Permitted Liens" shall mean (i) any lien securing a tax,
assessment or other governmental charge or levy or the claim of a materialman,
mechanic, carrier, warehouseman or landlord for labor, materials, supplies or
rentals incurred in the ordinary course of business; and (ii) any lien
constituting an encumbrance in the nature of zoning restrictions, easements and
rights or restrictions of record on the use of real property that does not
materially detract from the value of such property or impair the use thereof in
the business of the Maker.
Subject to the rights of the holder of the Senior Debt and as otherwise
expressly provided herein, Maker hereby waives demand, protest, presentment for
payment, notice of dishonor , notice of protest, diligence in bringing suit
against any party, and hereby consents that the time for payment of all or any
part of the principal amount, and of the interest thereon, may be extended from
time to time by Payee without notice, and that any such extension shall not
discharge or otherwise impair the obligations represented by this Note. The
foregoing waivers shall not be deemed to waive the requirement of any notice,
demand or cure periods expressly provided for in this Note.
THE COMPANY AND ANY HOLDER OF THIS NOTE HEREBY WAIVES TRIAL BY JURY IN
ANY COURT IN ANY SUIT, ACTION, OR PROCEEDING IN ANY MATTER ARISING IN CONNECTION
WITH OR IN ANY WAY RELATED TO THIS NOTE OR THE ENFORCEMENT OF ANY OF THE
HOLDER'S RIGHTS AND REMEDIES. THE COMPANY AND, BY ITS ACCEPTANCE HEREOF, EACH
HOLDER OF THIS NOTE, ACKNOWLEDGES THAT IT MAKES THIS WAIVER KNOWINGLY,
VOLUNTARILY AND ONLY AFTER THOROUGH CONSIDERATION OF THE RAMIFICATIONS OF THIS
WAIVER WITH ITS ATTORNEY. NEITHER THE COMPANY NOR ANY HOLDER OF THIS NOTE HAS
AGREED WITH OR REPRESENTED TO THE OTHER THAT THE PROVISIONS OF THIS PARAGRAPH
WILL NOT BE FULLY ENFORCED IN ALL INSTANCES.
All demands and notices to be given hereunder shall be delivered
personally or sent by recognized national overnight courier; in the case of the
Company, addressed to its corporate office at 000 Xxxxxxx Xxxxxx, , Xxxxx 0000,
Xxx Xxxx, Xxx Xxxx 00000, and in the case of Xxxxxx, addressed to the address
written above, in either case, until a new address shall have been substituted
by like notice.
This Note shall be governed by and construed in accordance with the
laws of the State of New York and shall be binding upon the successors and
assigns of the Maker and inure to the benefit of the Payee, its successors,
endorsees and assigns. If any term or provision of this Note shall be held
invalid, illegal or unenforceable, the validity of all other terms and
provisions hereof shall in no way be affected thereby.
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IN WITNESS WHEREOF, the Company has caused this Note to be executed on
its behalf by its duly authorized officer on the day and year first above
written.
AMERICAN INTERNATIONAL
PETROLEUM CORPORATION
By:
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Xxxxxx X. Xxxxx, Chairman & CEO
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