PROMISSORY NOTE
$557,056.43 Dallas, Texas October 6, 1999
FOR VALUE RECEIVED, the undersigned, RONALD W. PARKER, an individual
resident of Collin County, Texas, and ANNE G. PARKER, an individual resident of
Collin County, Texas (each individually a "Maker", and collectively "Makers"),
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hereby jointly and severally promise to pay to the order of PIZZA INN, INC., a
Missouri corporation ("Payee"), at its offices at 5050 Quorum Drive, Suite 500,
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Dallas, Texas, on June 30, 2004, in lawful money of the United States of America
and in immediately available funds, the principal sum of FIVE HUNDRED
FIFTY-SEVEN THOUSAND FIFTY-SIX AND 43/100 DOLLARS ($557,056.43), together with
interest on the outstanding principal balance from day to day remaining, at a
rate per annum which shall from day to day be equal to the weighted average rate
paid by the Payee from time to time under that certain Loan Agreement, dated as
of August 28, 1997, between Payee and Wells Fargo Bank (Texas), National
Association, as amended (the "WF Loan Agreement"), or any successor credit
agreement of the Payee. All accrued and unpaid interest on this Note shall be
due and payable on February 1, May 1, August 1 and November 1 of each year,
commencing on November 1, and at maturity.
Interest on the indebtedness evidenced by this Note shall be computed on
the basis of a year of 360 days and the actual number of days elapsed (including
the first day but excluding the last day) unless such calculation would result
in a usurious rate, in which case interest shall be calculated on the basis of a
year of 365 or 366 days, as the case may be. This is the promissory note
referenced in that certain Pledge Agreement, dated as of the date hereof, by and
between Makers and Payee (the "Pledge Agreement"). Terms defined in the Pledge
Agreement are used in this Note as defined in the Pledge Agreement unless
otherwise defined herein.
All payments of principal, interest, and other amounts to be made by Makers
shall be made to the Payee at its principal office in Dallas, Texas in U.S.
dollars and immediately available funds, without setoff, deduction, or
counterclaim, not later than 11:00 a.m., Dallas, Texas, time on the date on
which such payment shall become due (each such payment made after such time on
such due date to be deemed to have been made on the next succeeding business
day). The Makers shall, at the time of making each such payment, specify to the
Payee the sums payable by the Makers to which such payment is to be applied (and
in the event the Makers fail to so specify, or if an Event of Default has
occurred and is continuing, the Payee may apply such payment to the Obligations
in such order and manner as it may elect in its sole discretion). Whenever any
payment under this Note or the Pledge Agreement shall be stated to be due on a
day that is not a business day, such payment shall be made on the next
succeeding business day, and such extension of time shall in such case be
included in the computation of the payment of interest and commitment fee, as
the case may be.
As used in this Note, the following terms shall have the respective
meanings indicated below:
"Pledge Agreement" means that certain Pledge Agreement dated as of the date
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hereof between Makers and Payee, as the same has been or may be amended or
modified from time to time.
"Maximum Rate" is as defined in the WF Loan Agreement.
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"Mortgages" means those certain Mortgages dated October 6, 1999 by Maker to
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Payee relating to certain real property located in Wood County and Collin
County, Texas.
Makers or either Maker may prepay the principal of this Note in whole at
any time or from time to time in part without premium or penalty but with
accrued interest to the date of prepayment on the amount so prepaid.
Notwithstanding anything to the contrary contained herein, no provisions of
this Note shall require the payment or permit the collection of interest in
excess of the Maximum Rate. If any excess of interest in such respect is herein
provided for, or shall be adjudicated to be so provided, in this Note or
otherwise in connection with this loan transaction, the provisions of this
paragraph shall govern and prevail, and neither Makers nor the sureties,
guarantors, successors or assigns of Makers or either Maker shall be obligated
to pay the excess amount of such interest, or any other excess sum paid for the
use, forbearance or detention of sums loaned pursuant hereto. If for any reason
interest in excess of the Maximum Rate shall be deemed charged, required or
permitted by any court of competent jurisdiction, any such excess shall be
applied as a payment and reduction of the principal of indebtedness evidenced by
this Note; and, if the principal amount hereof has been paid in full, any
remaining excess shall forthwith be paid to Makers. In determining whether or
not the interest paid or payable exceeds the Maximum Rate, Makers and Payee
shall, to the extent permitted by applicable law, (i) characterize any
non-principal payment as an expense, fee, or premium rather than as interest,
(ii) exclude voluntary prepayments and the effects thereof, and (iii) amortize,
prorate, allocate, and spread in equal or unequal parts the total amount of
interest throughout the entire contemplated term of the indebtedness evidenced
by this Note so that the interest for the entire term does not exceed the
Maximum Rate.
If any Event of Default, as such term is defined in the Pledge Agreement or
the Mortgagees, shall occur and be continuing, the holder hereof may, at its
option, declare the entire unpaid principal of and accrued interest on this Note
immediately due and payable without notice, demand or presentment, all of which
are hereby waived, and upon such declaration, the same shall become and shall be
immediately due and payable, and the holder hereof shall have the right to
foreclose or otherwise enforce all liens or security interests securing payment
hereof, or any part hereof, and offset against this Note any sum or sums owed by
the holder hereof to either Maker. Failure of the holder hereof to exercise
this option shall not constitute a waiver of the right to exercise the same upon
the occurrence of a subsequent Event of Default.
If the holder hereof expends any effort in any attempt to enforce payment
of all or any part or installment of any sum due the holder hereunder, or if
this Note is placed in the hands of an attorney for collection, or if it is
collected through any legal proceedings, each Maker agrees to pay all costs,
expenses, and fees incurred by the holder, including reasonable attorneys' fees,
plus accrued and unpaid interest hereunder.
This Note shall be governed by and construed in accordance with the laws of
the State of Texas and the applicable laws of the United States of America.
This Note has been entered into in Dallas County, Texas, and it shall be
performable for all purposes in Dallas County, Texas.
Each Maker and each surety, guarantor, endorser, and other party ever
liable for payment of any sums of money payable on this Note jointly and
severally waive notice, presentment, demand for payment, protest, notice of
protest and non-payment or dishonor, notice of acceleration, notice of intent to
accelerate, notice of intent to demand, diligence in collecting, grace, and all
other formalities of any kind, and consent to all extensions without notice for
any period or periods of time and partial payments, before or after maturity,
and any impairment of any collateral securing this Note, all without prejudice
to the holder. The holder 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 release or substitute part or all of the collateral
securing this Note, 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.
/s/ Ronald W. Parker
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Ronald W. Parker
/s/ Anne G. Parker
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Anne G. Parker