REVOLVING CREDIT NOTE
$15,000,000.00 December 31, 1996
Baltimore, Maryland
FOR VALUE RECEIVED, Sylvan Learning Systems, Inc., a Maryland corporation
(the "Borrower") promises to pay on the Revolving Credit Expiration Date (as
hereinafter defined) to the order of NationsBank, N.A., a national banking
association (the "Bank") the aggregate unpaid principal amount of all Revolving
Loans (as hereinafter defined) outstanding on the Revolving Credit Expiration
Date and made by the Bank to the Borrower pursuant to the provisions of a
certain Loan Agreement (which Loan Agreement, as the same may from time to time
be amended, restated, supplemented or otherwise modified, is herein called the
"Loan Agreement") dated as of the date hereof between the Borrower and the Bank.
All capitalized terms used in this Note (including, without limitation, the
terms "Business Day", "Default", "Default Period", "Financing Documents", "Late
Charges", "Obligations", "Revolving Credit Interest Rate", "Revolving Loans",
"Revolving Loan Account", and "Revolving Credit Expiration Date"), unless
specifically herein defined, shall have the same meanings ascribed to such terms
in the Loan Agreement. The term "Principal Amount" means, as of any date, the
aggregate unpaid principal amount of all Revolving Loans advanced by the Bank to
the Borrowers pursuant to the provisions of the Loan Agreement and outstanding
on such date. The fact that there may be no Revolving Loans outstanding at any
particular time shall not affect the continuing validity of this Note.
Additionally, the Borrower promises to pay to the order of the Bank
interest on the Principal Amount (calculated on a daily basis) from time to time
outstanding at all times when a Default Period does not exist from the date
hereof until the maturity of this Note (whether by acceleration, declaration,
extension or otherwise) at a floating and fluctuating per annum rate of interest
equal at all times to the Bank's 30 Day LABOR Rate (as hereinafter defined) in
effect from time to time, plus one and fifteen one hundredths percent (1.15%)
per annum. Interest accrued on the Principal Amount at all times when a Default
Period does not exist from the date hereof until the maturity of this Note
(whether by acceleration, declaration, extension or otherwise) shall be paid by
the Borrower to the Bank monthly on or before the first day of each month,
commencing on March 1, 1997, and on the same day of each month thereafter until
the maturity of this Note (whether by acceleration, declaration, extension or
otherwise), at which time all unpaid interest accrued through the date of such
maturity shall be paid in full by the Borrower to the Bank. Notwithstanding the
entry of any decree, order, judgment or other judicial action under, pursuant
to, in connection with, or otherwise concerning this Note, the Loan Agreement or
any of the other Financing
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Documents, during a Default Period and/or after the maturity of this Note
(whether by acceleration, declaration, extension or otherwise), the Borrower
promises to pay to the Bank whenever demanded by the Bank interest on the
Principal Amount and all other amounts then and thereafter due and payable
hereunder at a floating and fluctuating per annum rate of interest equal at all
times to the Bank's 30 Day LIBOR Rate in effect from time to time, plus three
and fifteen one hundredths percent (3.15%) per annum, from the beginning of such
Default Period for so long as such Default Period continues, or, from the date
of such maturity until payment in full of the Principal Amount, all accrued and
unpaid interest thereon and any and all such other amounts due and payable
hereunder. The term "30 Day LIBOR Rate" as used herein means the floating and
fluctuating per annum rate of interest determined by the daily London Interbank
Offered Rate (expressed as a percentage) for thirty (30) day dollar deposits as
quoted by the Bank for 11:00 a.m. (London time). Each time the 30 Day LIBOR Rate
shall change, the rate of interest on the Principal Amount shall change
immediately and contemporaneously with each such change of the 30 Day LIBOR
Rate. Interest shall be computed on the basis of a 360 day-year and the actual
number of days elapsed.
The Bank shall open and maintain on its books in the ordinary course of its
business the Revolving Loan Account described in the Loan Agreement. Except in
the case of manifest error, the Revolving Loan Account shall be conclusive and
binding on the Borrower as to amounts due by the Borrowers to the Bank under the
provisions of this Note.
If any payment on this Note becomes due and payable on a day other than a
Business Day, such payment shall be extended to the next succeeding Business Day
and, with respect to payments of principal, interest thereon shall be payable at
the then applicable rate of interest as herein provided during such extension.
This Note is the "Revolving Credit Note" issued pursuant to the provisions
of the Loan Agreement. The obligations of the Borrower evidenced by this Note
are a part of the Obligations referred to in the Loan Agreement. The Bank is
entitled to the benefits of the Loan Agreement, the other Financing Documents
and the Collateral referred to therein.
Upon the occurrence of a Default specified in Sections 6.12, 6.13 or 6.14
of the Loan Agreement, the unpaid balance of the Principal Amount, together with
interest accrued and unpaid thereon, shall immediately and automatically become
due and payable by the Borrower to the Bank. Upon the occurrence of any other
Default under the Loan Agreement, or upon the failure of the Borrower to pay, as
and when due and payable in accordance with this Note, the Principal Amount or
any payment of interest on the Principal Amount, the Bank or any other holder of
this Note may, at
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its option, accelerate the maturity of this Note and declare the unpaid balance
of the Principal Amount of this Note then outstanding together with interest
accrued and unpaid thereon to be immediately due and payable, then and in that
event the entire balance of the Principal Amount of this Note then outstanding
together with interest accrued and unpaid thereon shall be immediately due and
payable by the Borrower to the Bank. The Borrower waives diligence, presentment,
demand, protest and notice of any kind except for any notice expressly provided
for herein.
Terms and conditions relating to the prepayment of this Note are set forth
among the provisions of the Loan Agreement. The Borrower shall pay to the Bank
Late Charges on account of this Note at the times and in the amounts prescribed
by the Loan Agreement.
All payments and prepayments of the Principal Amount, interest thereon and
any other amounts payable hereunder shall be paid in lawful money of the United
States of America in immediately available funds during regular business hours
of the Bank at the Bank's office at 10 Light Street, Baltimore, Maryland, 21202,
Maryland or at such other place as the Bank or any other holder of this Note may
at any time or from time to time designate in writing to the Borrower.
If this Note is forwarded to an attorney for collection after maturity
hereof (whether by acceleration, declaration, extension or otherwise), the
Borrower shall pay to the Bank on demand all costs and expenses of collection
including reasonable attorney's fees.
After maturity of this Note (whether by acceleration, declaration,
extension or otherwise), the Borrower hereby authorizes any attorney designated
by the Bank or clerk of any court of record to appear for it in any court of
record and confess judgment against it without prior hearing, in favor of the
Bank for and in the amount of the Principal Amount then outstanding plus
interest accrued and unpaid thereon, all other amounts then due and payable
hereunder, costs of suit and attorney's fees in an amount equal to 15% of the
Principal Amount then outstanding; provided, however, (a) if the actual
attorney's fees incurred by the Bank or other holder hereof are less than 15% of
the Principal Amount then outstanding and all Obligations owed to the Bank by
the Borrower have been paid, the Bank will refund (to the extent actually
collected) to the Borrower an amount equal to the difference between 15% of the
Principal Amount then outstanding and the amount of such actual attorney's fees,
or (b) if the actual attorney's fees incurred by the Bank or other holder hereof
exceed 15% of the Principal Amount then outstanding, whether by reason of
judgment being contested or otherwise, the Borrower shall pay to the Bank on
demand the amount of any such excess. The authority and power to appear for and
enter judgment against the Borrower shall not be exhausted by one or more
exercises thereof, or by any imperfect
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exercise thereof, and shall not be extinguished by any judgment entered pursuant
thereto. Such authority and power may be exercised on one or more occasions,
from time to time, in the same or different jurisdictions, as often as the Bank
shall deem necessary or desirable, for all of which this Note shall be a
sufficient warrant.
The rights and remedies of the Bank or any other holder hereof under this
Note, the Loan Agreement and the other Financing Documents shall be cumulative
and concurrent and may be pursued and exercised singularly, successively or
concurrently at the sole discretion of the Bank or any other holder hereof and
may be exercised as often as the Bank or any other holder hereof shall deem
necessary or desirable, and the non-exercise by the Bank or any other holder
hereof of any such rights and remedies in any particular instance shall not in
any way constitute a waiver or release thereof in that or any subsequent
instance.
The Borrower and the Bank hereby voluntarily and intentionally waive any
right they may have to a trial by jury in any action, proceeding or litigation
directly or indirectly arising out of, under or in connection with this Note,
the Loan Agreement or any of the other Financing Documents.
This Note shall be governed and construed under the laws of the State of
Maryland, and the Borrower hereby irrevocably consents and submits to the
jurisdiction and venue of any state or federal court sitting in the State of
Maryland over any suit, action or judicial proceeding brought to enforce or
construe this Note or arising out of or relating to this Note.
IN WITNESS WHEREOF, the Borrower has caused this Note to be executed in its
name, under its seal and on its behalf by its duly authorized officers the day
and year first written above.
ATTEST: Sylvan Learning Systems, Inc.
/s/ Susannah Bennett By: /s/ B. Lee McGee (Seal)
- ----------------------------- ---------------------------------
Susannah Bennett, Assistant B. Lee McGee,
Secretary Vice President
(SEAL)
SYLVAN LEARNING SYSTEMS, INC.
CORPORATE
1989
SEAL
MARYLAND
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