EXHIBIT 10.5.4
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND HAS
BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE ASSIGNED, SOLD, TRANSFERRED,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
FOR THIS NOTE UNDER THE SECURITIES ACT OF 1933) OR AN OPINION OF COUNSEL
SATISFACTORY TO THE MAKER THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT.
$300,000.00 January 16, 1996
PROMISSORY NOTE
ATLANTA TOYOTA. INC., a Texas corporation (hereinafter called "Maker"), for
value received, promises and agrees to pay to First Extended Service
Corporation (hereinafter called "Payee"), in lawful money of the United
States of America, the principal sum of THREE HUNDRED THOUSAND DOLLARS
($300,000.00), together with interest thereon (calculated on the basis of a
365 day year, or a 366 day year in the case of a leap year) from and after
the date hereof until maturity at a rate per annum equal to eight and
one-half percent (8.5%) (the "Applicable Rate"), but in no event in excess of
the maximum rate of nonusurious interest allowed from time to time by law
(hereinafter called the "Highest Lawful Rate"). All past due amounts of
principal of, and to the extent permitted by applicable law, unpaid interest
on, this note from time to time outstanding, and all unpaid amounts of
principal of this note during any period in which an Event of Default (as
hereinafter defined) exists or would exist but for the giving of notice or
the passage of time, shall bear interest at the rate equal to the Applicable
Rate plus 5%, but in no event greater than the Highest Lawful Rate. All sums
due under this note are payable to Payee at such address as may be designated
in writing by Payee to the Maker.
THE PRINCIPAL of this Note shall be paid in installments of $150,000 on
January 2, 1997 and $150,000 on January 2, 1998.
ACCRUED INTEREST is due and payable on June 30, 1996, January 2, 1997, June
30, 1997 and January 2, 1998; provided however, that if the principal of this
note is prepaid in whole or in part, all accrued and unpaid interest is due
and payable on the date of such prepayment. If any amount owing under this
note is due and payable on a day that is not a business day, such payment
shall instead be due and payable on the next succeeding business day. Maker
has the right to prepay this note in whole or in part at any time and from
time to time without premium or penalty upon not less than five days' notice
to Payee.
SO LONG as any principal or interest remains unpaid on this note, Maker
will comply or cause compliance with each of the following covenants:
$300,000.00 January 16, 1996
(a) Maker shall, within fifteen (15) days after such are prepared but
in no event later than 120 days after the close of each fiscal year of
United Auto Group, Inc. a Delaware corporation ("UAG"), furnish to Payee
the audited consolidated financial statements of UAG for such period;
provided, however, that if UAG's auditors have not delivered such
financial statements within said 120-day period despite UAG's diligent
requests of them to do so, such added delay shall not constitute a
default or an Event of Default (as hereinafter defined) under this note.
In addition, Maker shall furnish to Payee from time to time (but no
more than once in any given calendar year), within 30 days after a
request by Payee, current unaudited consolidated financial statements of
Maker.
(b) Maker shall promptly notify Payee in writing of any Event of
Default under this note or any event that with the giving of notice or
the passage of time or both would constitute an Event of Default under
this note.
FOR PURPOSES of this note, an "Event of Default" shall occur whenever: (a)
default is made in the payment when due of the principal of this note, (b)
default is made in the payment when due of any installment of interest on
this note and such default has not been cured within five days after the date
on which Maker receives notice of the default from Payee,. (c) Maker shall
fail to perform or observe any other term, covenant or agreement contained in
this note and any such failure shall remain unremedied for 10 days after
written notice thereof shall have been given to Maker by Payee, (d) Maker or
UAG or any of UAG's other subsidiaries shall fail to pay when due any
principal of or interest on any indebtedness (other than this note) in excess
of $500,000 and such failure shall continue after the applicable grace
period, if any, specified in the agreement or instrument related to such
indebtedness or any other default under any agreement or instrument related
to such indebtedness, or any other event, shall occur and shall continue
after the applicable grace period, if any, specified in such agreement or
instrument, if the effect of such default or event is to accelerate, or to
permit the acceleration of, the maturity of such indebtedness, or any such
indebtedness shall be declared to be due and payable, or required to be
prepaid (other than by a regularly scheduled required prepayment), prior to
stated maturity thereof, (e) UAG shall sell all or substantially all of its
assets or UAG shall pay a dividend or make a distribution to holders of its
securities generally (other than in shares of stock or other securities of
UAG or rights to purchase stock or other securities of UAG), which dividend
or distribution, together with all other dividends or distributions by UAG on
or after the date hereof, shall result in an amount in excess of twenty-five
percent (25%) of UAG's assets having been distributed to its shareholders,
(f) Maker or UAG institutes proceedings to
$300,000.00 January 16, 1996
be adjudicated as bankrupt or insolvent, or consents to institution of
bankruptcy or insolvency proceedings against it or the filing by it of a
petition or answer or consent seeking reorganization or release under the
federal Bankruptcy Act or any other applicable federal or state law, or
consents to the filing of any such petition or the appointment of a receiver,
liquidator, assignee, trustee or other similar official of Maker or UAG, or
of any substantial part of its property, or makes an assignment for the
benefit of creditors, or takes corporate action in furtherance of any such
action, or (g) within 60 days after the commencement of an action against
Maker or UAG seeking any bankruptcy, insolvency, reorganization, liquidation,
dissolution or similar relief under any present or future statute, law or
regulation, such action shall not have been resolved in favor of Maker or
UAG, as applicable, or all orders or proceedings thereunder affecting the
operations or the business of Maker or UAG, as applicable, staged, or if the
stay of any such order or proceeding shall thereafter be set aside, or if,
within 60 days after the appointment without the consent or acquiescence of
Maker or UAG of any trustee, receiver or liquidator of Maker or UAG or all or
any substantial part of its properties, such appointment shall not have been
vacated.
UPON THE OCCURRENCE and during the continuance of any Event of Default
described in clause (a), (b), (c), (d) or (e) of the foregoing paragraph,
Payee may declare the entire principal amount then outstanding under this
note, together with interest then accrued thereon, to be immediately due and
payable. Upon the occurrence of any Event of Default described in clause (f)
or (g) of the foregoing paragraph, the entire principal amount of all
indebtedness then outstanding under this note, together with interest then
accrued thereon, shall automatically become immediately due and payable.
IT IS the intention of Maker and Payee to conform strictly to applicable
usury laws. Accordingly, if the transactions contemplated hereby would be
usurious under applicable law (including the laws of the State of Georgia and
the laws of the United States of America), then, in that event,
notwithstanding anything to the contrary herein or in any agreement entered
into in connection with or as security for this note, it is agreed that the
aggregate of all consideration which constitutes interest under applicable
law that is taken, reserved, contracted for, charged or received under this
note or under any of the other aforesaid agreements or otherwise in
connection with this note shall under no circumstances exceed the maximum
amount of interest allowed by applicable law, and any excess shall be
cancelled automatically and, if theretofore paid, shall be credited on the
note by the holder hereof (or, to the extent that this note shall have been
or would thereby be paid in full, refunded to the Maker).
$300,000.00 January 16, 1996
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, Maker agrees to pay all reasonable
costs, expenses and fees incurred by the holder, including reasonable
attorney's fees.
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, all without prejudice to the holder.
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 do
hereby, to the extent permitted by applicable law, further convey and assign
to the holder hereof and waive and renounce any and all exemption rights
which they may have under or by virtue of the Constitution or laws of
Georgia, or any other state, or the United States, as may be allowed, against
this debt or any renewal thereof.
THIS NOTE has been executed and delivered in and shall be construed in
accordance with and governed by the laws of the State of Georgia and of the
United States of America.
ATLANTA TOYOTA, INC.
By: /s/ Illegible
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Its: President
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