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Exhibit 10.4 MASTER NOTE
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Approval
Chattanooga, Tennessee
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August 13 ,1997
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FOR VALUE RECEIVED, the undersigned (jointly and severally, if more than one)
promise(s) to pay to the order of First Tennessee Bank National Association
(hereinafter referred to as the "Bank") at any lending office in the state
mentioned above or at such other place as the holder hereof may designate in
writing, in current local funds, the sum of up to FIVE HUNDRED THOUSAND AND NO
Dollars ($500,000.00), or so much thereof as may be advanced hereunder prior to
maturity, together with interest on the unpaid principal balance from day-to-day
remaining, computed from the day of advance until maturity at the following
rate:
[ ] FIXED RATE: ______% per annum,
[X] VARIABLE RATE: A variable rate per annum ("Variable Rate") which
shall be equal to the lesser of (a) the maximum rate of interest
("Maximum Rate") which Bank may lawfully charge, or (b) a rate which is
0% per annum higher than the base commercial rate of interest ("Base
Rate") established from time to time by Bank. Each change in the
Variable Rate which results from a change in the Maximum Rate shall
become effective, without notice to the undersigned, on the same date
that the Maximum Rate changes. Each change in the Variable Rate which
results from a change in the Base Rate shall become effective, without
notice to the undersigned, on |_| the same date that the Base Rate
changes; |_| the first day of the calendar month following any change
in the Base Rate; |_| the first day of the calendar quarter following
any change in the Base Rate; |_| other _________________. The Base Rate
is one of several interest rate indices employed by the Bank. The
undersigned acknowledge(s) that the Bank has made, and may hereafter
make, loans bearing interest at rates which are higher or lower than
the Base Rate.
[X] SINGLE PRINCIPAL PAYMENT: One single principal payment of the balance,
due on August 15, 1998 plus interest payable.
[ ] at maturity.
[X] beginning November 15, 1997 and continuing on the same day of
each successive quarterly calendar period, except that the
final interest installment shall be payable on the on the date
the principal is due.
[ ] OTHER:________________________________________________________________
______________________________________________________________________
SECURITY: Except as otherwise provided herein, as of the date hereof,
[ ] This Note is secured by a mortgage(s) or dead(s) of trust dated
COMMITMENT FEE: The undersigned agrees to pay an annual loan commitment fee
of $0.00, due and payable at the time of execution of this Note, and each
year thereafter on the anniversary date thereof.
OTHER TERMS AND CONDITIONS: Unless otherwise provided herein, all payments shall
be applied first to pay the accrued interest to date on the unpaid balance and
next to the unpaid principal of the indebtedness.
As used herein, "other parties liable hereon" shall include, but not be
limited to, any and all guarantors, endorsers, sureties and co-makers.
Any payment not made when due hereunder (whether by acceleration or
otherwise) shall bear interest after maturity at the maximum effective contract
rate of interest which the Bank may lawfully charge on the date such payment
became due.
The undersigned acknowledges and agrees that any commitment fees payable
hereunder are bona fide commitment fees and are intended as reasonable
compensation to Bank for committing to make funds available to undersigned and
for no other purpose.
Subject to the terms and conditions herein set forth, Bank agrees to advance
funds upon the request of and as directed by the undersigned from time to time
beginning on the date hereof and terminating upon maturity. Within the limits
set forth herein, the undersigned may borrow, repay and reborrow each advance.
Notwithstanding the principal amount of this Note, as stated on the face hereof,
the amount of principal actually owing at any given time shall be the aggregate
of all advances made, less all payments of principal actually received by Bank.
Bank's obligation to make advances hereunder shall be subject to the
following conditions: (a) there has been no material adverse change in the
undersigned's financial condition, or the financial condition of any other
parties liable hereon, since execution of this Note; (b) each advance shall
constitute a representation and warranty by the undersigned and other parties
liable hereon that all representations and warranties contained herein or any
other document pertaining to this credit facility are true and correct on and as
of the date of the advance, and that the undersigned and other parties liable
hereon are in strict compliance with all terms and conditions herein and
pertaining hereto; (c) the undersigned and other parties liable hereon will
furnish, from time to time, at Bank's option and at Bank's request, statements
of financial condition in a form satisfactory to Bank including independently
certified and audited statements prepared in accordance with generally accepted
accounting principals and auditing standards. The undersigned and others parties
liable hereon hereby authorizes Bank to charge an interest rate equal to
one-half percent (.5%) per annum higher than interest rate agreed to herein, or
as modified hereafter, should the undersigned or other parties liable hereon
fail to deliver a financial statement in the form requested by Bank within 10
days of Bank's request; (d) the undersigned and other parties liable hereon will
execute and deliver to Bank all other instruments and take such other actions as
Bank may reasonably request during the term hereon in order to carry out the
provisions and intent hereof.
If this Note is place in the hands of an attorney for collection, by suit or
otherwise, or to protect any security given for its payment, or to enforce its
collection, the Undersign will pay all the costs of collection and litigation,
together with a reasonable attorney's fee, or of which shall be secured by any
collateral pledged as security herefor. The undersigned also agrees to pay any
and all actual expenses including reasonable attorney's fees incurred by the
Bank in (i) successfully defending any action or inaction in connection with any
aspect of the transaction evidenced by this instrument, or (ii) any action,
whether or not successful, taken to protect or enforce Bank's rights in any
collateral related to the transaction evidenced by this instrument.
The undersigned and all other parties liable hereon waive protest, demand,
presentment, and notice of dishonor, and agree that this Note may be extended,
in whole or in part, without limit as to the number of such extensions, or the
period or periods thereof, and without note to or further assent from them, all
of whom will remain bound upon this Note notwithstanding any such extension(s);
and further agree that all and any collateral given, now or hereafter, as
security herefor may be released (with or without substitution) without notice
and without affecting their liability thereon; and that additional makers,
endorsors, guarantors, or sureties may become parties hereto, and that any
present or future party may be released from liability hereunder, without
notice, and without affecting the liability of any other maker, or other parties
liable hereon.
In the event of any default in the prompt and punctual payment, when due, of
this Note (or any installment hereof), or any bankruptcy, insolvency,
receivership, or similar proceeding instituted by or against the undersigned or
other parties liable hereon or his/her or their property or assets, or in the
event that the undersigned or other parties liable hereon become insolvent,
however defined, or make an assignment for the benefit of creditors, or if a
judgment be entered against the undersigned, or other parties liable hereon, or
upon the issuance of any writ, levy or process, valid or invalid, which Bank, or
upon the death or dissolution of the undersigned or other parties liable hereon,
or in the event of any default in the prompt and punctual payment when due, of
any other indebtedness or obligation to the Bank owed, now or hereafter, by the
undersigned or other parties liable hereon, or upon any default in any deed of
trust, mortgage, security agreement, assignment or other security document
given, now or hereafter, to secure the indebtedness evidenced hereby, or if any
representation or warranty may by the undersigned or other parties liable
pertaining to this credit shall prove to be false, untrue, or materially
misleading, or in the event of termination of any guaranty executed in
connection with the Note, or in the event that the Bank shall deem itself
insecure, then and in any of such events, this Note shall, at Bank's option,
without notice or demand for payment (the same being expressly waived), be and
become immediately due, payable and enforceable for all purposes and Bank shall
be under no obligation to make further advances.
Any money or other property at any time in possession of the Bank belonging
to the undersigned or any other party liable hereon, and any deposits or other
sums at any time credited by or due from the Bank to the undersigned or any
other parties liable hereon, may at all times, at the option of the Bank, be
held and treated as collateral security for the payment of this Note or any
other liability of any of the undersigned, or any other party liable hereon to
the Bank, whether due or not due. The Bank may, at any time, at its option, and
without notice, set off the amount due or to become due hereon against the claim
of any of the said parties against the Bank. To effect these rights, the
undersigned and all other parties liable hereon agree, upon request by the Bank,
immediately to endorse, sign, and execute all necessary instruments, and do
hereby appoint the Bank (action through any then officer thereon) as
attorney-in-fact for them with authority to endorse any instrument requiring
endorsement and to effect any transfer, and this appointment shall be
irrevocable as long as the undersigned, or any other party liable hereon shall
be indebted to the Bank.
In the event of any renewal or extension of the loan indebtedness evidenced
hereby, unless the parties otherwise agree to a lower rate, the Bank shall have
the right to charge interest at the highest of the following rates: (i) the
maximum rate permissible at the time the contract to make the loan was executed;
or (ii) the maximum rate permissible at the time the loan made; or (iii) the
maximum rate permissible at the time of such renewal or extension; or (iv) the
maximum rate permitted by applicable federal law; it being intended that those
statutes and laws, state or federal, from time to time in effect, which permit
the charging of the higher rate of interest shall govern the maximum rate which
may be charged hereunder. In the event that for any reason the foregoing
provisions hereof shall not contain a valid, enforceable designation of a rate
of interest prior to maturity or method of determining the same, then the
indebtedness hereby evidenced shall bear interest prior to maturity at the
maximum effective rate which may be lawfully charged by the Bank under
applicable law.
Regardless of any provision herein, or in any other document executed in
connection herewith, the holder hereof shall never be entitled to receive,
collect, or acquire, as interest hereon, any amount in excess of the maximum
contract rate which may be lawfully charged by the holder hereof under
applicable law; and in the event the holder hereof ever receives, collects, or
applies as interest, any such excess, such amount which would be excessive
interest shall be deemed a partial prepayment of the principal and treated
hereunder as such; and, if the principal hereof is paid in full, any remaining
excess shall forthwith be paid to the undersigned. In determining whether or not
the interest paid or payable, under any specific contingency, exceeds the
maximum lawful contract rate, the undersigned and the holder hereof shall, to
the maximum extent permitted by applicable law, (a) characterize any
non-principal payment as a reasonable loan charge rather than as interest; (b)
exclude voluntary prepayment and the effect thereof; (c) amortize, prorate,
allocate, and spread, in equal parts, the total amount of interest throughout
the entire contemplated term hereof so that the interest to accrue throughout
the entire term contemplated hereby shall at no time exceed the maximum lawful
contract rate.
THE UNDERSIGNED JOINTLY AND SEVERALLY WAIVE(S) ANY RIGHT TO A TRIAL BY JURY
IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT
OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED (OR WHICH
MAY IN THE FUTURE BE DELIVERED) IN CONNECTION HEREWITH OR ARISING FROM ANY
BANKING RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT. THE UNDERSIGNED
AGREE(S) THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND
NOT A JURY.
UNITY NATIONAL BANK (IN ORGANIZATION)
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/s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ /s/ B. Don Temples /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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