REPLACEMENT REVOLVING LOAN NOTE
$26,665,000.00 November 21, 1997
FOR VALUE RECEIVED AND INTENDING TO BE LEGALLY BOUND HEREBY, the
undersigned, Piercing Pagoda, Inc. ("Borrower"), a Delaware corporation,
promises to pay to the order of Summit Bank ("Lender"), at the offices of
CoreStates Bank, N.A. ("Administrative Agent"), a national bank with an
office at Broad and Chestnut Streets, Philadelphia, Pennsylvania, or at such
other location as Administrative Agent may designate from time to time, with
interest as set forth below, the principal sum of Twenty-Six Million Six
Hundred Sixty-Five Thousand ($26,665,000.00) Dollars or such lesser sum
which represents ▇▇▇▇▇▇'s Pro Rata Share of the principal balance
outstanding under the Revolving Loan established pursuant to the provisions
of that certain Syndicated Loan Agreement dated March 27, 1997 among
Borrower, Administrative Agent, Lender and the other "Lenders" listed
therein, as amended pursuant to the provisions of that certain First
Amendment to Syndicated Loan Agreement of even date herewith among such
parties (as it may be supplemented, restated, superseded, further amended or
replaced from time to time, "Loan Agreement"). The outstanding principal
balance hereunder shall, absent earlier acceleration, be payable on the
Revolving Loan Termination Date. The actual amount due and owing from time
to time hereunder shall be evidenced by Administrative Agent's records of
receipts and disbursements with respect to the Revolving Loan, which shall
be prima facie evidence of the amount. All capitalized terms used herein
without further definition shall have the respective meanings ascribed
thereto in the Loan Agreement.
▇▇▇▇▇▇▇▇ further agrees to pay interest on the outstanding principal
balance hereunder from time to time at one or more of the per annum Rates
set forth in Paragraph 2.8 of the Loan Agreement. Interest shall be
calculated on the basis of a year of 360 days for the actual number of days
elapsed, and shall be due and payable as set forth in the Loan Agreement.
The Revolving Loan shall continue to accrue interest at the applicable
Rates provided for in the Loan Agreement even after Default, an Event of
Default, maturity, acceleration, judgment, bankruptcy, insolvency
proceedings of any kind or the happening of any other event or occurrence,
whether similar or dissimilar.
If an Event of Default occurs and is continuing under the Loan
Agreement, the unpaid principal balance of this Replacement Revolving Loan
Note, together with all accrued and unpaid interest and other outstanding
Obligations shall become, or may be declared, immediately due and payable as
provided in the Loan Agreement.
This Replacement Revolving Loan Note may be prepaid only in accordance
with the terms and conditions of the Loan Agreement.
Any failure or delay of Administrative Agent, any Agent or Lender to
exercise any right hereunder shall not be construed as a waiver of the right
to exercise the same or any other right at any other time or times. The
waiver by Administrative Agent, any Agent or Lender of a breach or default
of any provision of this Replacement Revolving Loan Note shall not operate
or be construed as a waiver of any subsequent breach or default hereof.
▇▇▇▇▇▇▇▇ agrees to reimburse Administrative Agent for all expenses incurred
by Administrative Agent, Lender or any other lender in accordance with the
provisions of the Loan Agreement.
This Replacement Revolving Loan Note shall be construed and governed
by the laws of the Commonwealth of Pennsylvania without regard to otherwise
applicable principles of conflicts of laws. The provisions of this
Replacement Revolving Loan Note are severable and the invalidity or
unenforceability of any provision shall not alter or impair the remaining
provisions of this Replacement Revolving Loan Note. No modification hereof
shall be binding or enforceable against Lender unless approved in writing by
▇▇▇▇▇▇.
THE FOLLOWING SETS FORTH A WARRANT OF AUTHORITY FOR ANY ATTORNEY TO, AFTER
THE OCCURRENCE AND DURING THE CONTINUANCE OF AN EVENT OF DEFAULT, CONFESS
JUDGMENT AGAINST BORROWER. IN GRANTING THIS WARRANT OF ATTORNEY TO CONFESS
JUDGMENT AGAINST ▇▇▇▇▇▇▇▇, BORROWER, FOLLOWING CONSULTATION WITH (OR
DECISION NOT TO CONSULT WITH) SEPARATE COUNSEL FOR ▇▇▇▇▇▇▇▇, AND WITH
KNOWLEDGE OF THE LEGAL EFFECT HEREOF, HEREBY WAIVES ANY AND ALL RIGHTS
▇▇▇▇▇▇▇▇ HAS, OR MAY HAVE, TO PRIOR NOTICE AND AN OPPORTUNITY FOR HEARING
BEFORE ENTRY OF JUDGMENT, OR EXECUTION UPON ANY REAL OR PERSONAL PROPERTY OF
BORROWER UNDER THE CONSTITUTIONS AND LAWS OF THE UNITED STATES AND THE
COMMONWEALTH OF PENNSYLVANIA. ▇▇▇▇▇▇▇▇ SPECIFICALLY ACKNOWLEDGES THAT
ADMINISTRATIVE AGENT AND ▇▇▇▇▇▇▇ HAVE RELIED ON THIS WARRANT OF ATTORNEY IN
GRANTING THE FINANCIAL ACCOMMODATIONS DESCRIBED HEREIN.
AFTER THE OCCURRENCE AND DURING THE CONTINUANCE OF AN EVENT OF DEFAULT,
BORROWER HEREBY EMPOWERS ANY PROTHONOTARY, CLERK, OR ATTORNEY OF ANY COURT
OF RECORD IN THE UNITED STATES, OR ELSEWHERE, TO APPEAR FOR BORROWER IN ANY
AND ALL ACTIONS WHICH MAY BE BROUGHT HEREUNDER IN THE COMMONWEALTH OF
PENNSYLVANIA OR ELSEWHERE AND CONFESS JUDGMENT AGAINST BORROWER FOR ALL, OR
ANY PART, OF THE UNPAID PRINCIPAL BALANCE HEREUNDER, AND ACCRUED INTEREST
TOGETHER WITH OTHER EXPENSES INCURRED IN CONNECTION THEREWITH AND ATTORNEYS'
FEES OF FIVE PERCENT (5%) OF THE TOTAL OF THE FOREGOING SUMS, BUT IN NO
EVENT LESS THAN FIVE THOUSAND ($5,000.00) DOLLARS, AND FOR SUCH PURPOSE, THE
ORIGINAL OR ANY PHOTOCOPY OF THIS REPLACEMENT REVOLVING LOAN NOTE SHALL BE A
GOOD AND SUFFICIENT WARRANT OF ATTORNEY. SUCH AUTHORITY SHALL NOT BE
EXHAUSTED BY ONE EXERCISE THEREOF BUT JUDGEMENT MAY BE CONFESSED AS
AFORESAID FROM TIME TO TIME. BORROWER WAIVES ALL ERRORS AND RIGHTS OF
APPEAL, AS WELL AS RIGHTS TO STAY OF EXECUTION AND EXEMPTION OF PROPERTY, IN
ANY ACTION TO ENFORCE ITS LIABILITY HEREON.
Except as expressly set forth in the Loan Agreement, Borrower hereby waives
protest, notice of protest, presentment, dishonor, notice of dishonor and
demand. To the extent permitted by law, Borrower hereby waives and releases
all errors, defects and imperfections in any proceedings instituted by
Administrative Agent or any Lender under the terms of this Replacement
Revolving Loan Note. The rights and privileges of Administrative Agent and
any Lender under this Replacement Revolving Loan Note shall inure to the
benefit of its successors and assigns. All representations, warranties and
agreements of Borrower made in connection with this Replacement Revolving
Loan Note shall bind ▇▇▇▇▇▇▇▇'s successors and assigns. The rights and
remedies of Administrative Agent or Lender under this Replacement Revolving
Loan Note shall be in addition to any other rights and remedies available to
Administrative Agent or Lender at law or in equity, all of which may be
exercised singly or concurrently. The parties agree to the exclusive
jurisdiction of the federal and state courts located in Pennsylvania in
connection with any matter arising hereunder, including the collection and
enforcement hereof, except as the Administrative Agent may otherwise elect.
▇▇▇▇▇▇▇▇ (and Administrative Agent and Lender by their acceptance hereof)
each hereby waives any and all rights it may have to a jury trial in
connection with respect to rights any litigation arising with rights and
obligations of the parties hereto.
IN WITNESS WHEREOF, intending to be legally bound, ▇▇▇▇▇▇▇▇ has duly
executed this Replacement Revolving Loan Note the day and year first above
written and has hereunto set hand and seal.
ATTEST: PIERCING PAGODA, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇____ By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Treasurer Title:
President
(Corporate Seal)