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U.S. Small Business Administration
SBA LOAN NUMBER
GP-EWCP 838500 30 06
NOTE
Tigard, Oregon
--------------------
(City and State)
$650,000.00 (Date) June 28, 1995
For value received, the undersigned promises to pay to the order of
Centennial Bank (Payee) at its office in the city of Tigard, State of Oregon or
at holder's option, at such other place as may be designated from time to time
by the holder Six Hundred Fifty Thousand and No/1OO dollars, with interest on
unpaid principal computed from the date of each advance to the undersigned at
the rate of (See page 4) percent per annum, payment to be made in installments
as follows:
See page 4.
If this Note contains a fluctuating interest rate, the notice provision is
not a pre-condition for fluctuation (which shall take place regardless of
notice). Payment of any installment of principal or interest owing on this
Note may be made prior to the maturity date thereof without penalty. Borrower
shall provide lender with written notice of intent to prepay part or all of
this loan at least three (3) weeks prior to the anticipated prepayment date. A
prepayment is any payment made ahead of schedule that exceeds twenty (20)
percent of the then outstanding principal balance. If borrower makes a
prepayment and fails to give at least three weeks advance notice of intent to
prepay, then, notwithstanding any other provision to the contrary in this note
or other document, borrower shall be required to pay lender three weeks
interest on the unpaid principal as of the date preceding such prepayment.
SBA Form 147 (5-87) Previous editions obsolete Page 1
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The term "Indebtedness" as used herein shall mean the indebtedness
evidenced by this Note, including principal, interest, and expenses, whether
contingent, now due or hereafter to become due and whether heretofore or
contemporaneously herewith or hereafter contracted. The term "Collateral" as
used in this Note shall mean any funds, guaranties, or other property or rights
therein of any nature whatsoever or the proceeds thereof which may have been,
are, or hereafter may be, hypothecated, directly or indirectly by the
undersigned or others, in connection with, or as security for, the Indebtedness
or any part thereof. The Collateral, and each part thereof, shall secure the
Indebtedness and each part thereof. The covenants and conditions set forth or
referred to in any and all instruments of hypothecation constituting the
Collateral are hereby incorporated in this Note as covenants and conditions of
the undersigned with the same force and effect as though such covenants and
conditions were fully set forth herein.
The Indebtedness shall immediately become due and payable, without notice
or demand, upon the appointment of a receiver or liquidator, whether voluntary
or involuntary, for the undersigned or for any of its property, or upon the
filing of a petition by or against the undersigned under the provisions of any
State insolvency law or under the provisions of the Bankruptcy Reform Act of
1978, as amended, or upon the making by the undersigned of an assignment for
the benefit of its creditors. Holder is authorized to declare all or any part
of the Indebtedness immediately due and payable upon the happening of any of
the following events: (1) Failure to pay any part of the Indebtedness when
due; (2) nonperformance by the undersigned of any agreement with, or any
condition imposed by, Holder or Small Business Administration (hereinafter
called "SBA") with respect to the Indebtedness; (3) Holder's discovery of the
undersigned's failure in any application of the undersigned to Holder or SBA to
disclose any fact deemed by Holder to be material or of the making therein or
in any of the said agreements, or in any affidavit or other documents submitted
in connection with said application or the indebtedness, of any
misrepresentation by, on behalf of, or for the benefit of the undersigned; (4)
the reorganization (other than a reorganization pursuant to any of the
provisions of the Bankruptcy Reform Act of 1978, as amended) or merger or
consolidation of the undersigned (or the making of any agreement therefor)
without the prior written consent of Holder; (5) the undersigned's failure duly
to account, to Holder's satisfaction, at such time or times as Holder may
require, for any of the Collateral, or proceeds thereof, coming into the
control of the undersigned; or (6) the institution of any suit affecting the
undersigned deemed by Holder to affect adversely its interest hereunder in the
Collateral or otherwise. Holder's failure to exercise its rights under this
paragraph shall not constitute a waiver thereof.
Upon the nonpayment of the Indebtedness, or any part thereof, when due,
whether by acceleration or otherwise, Holder is empowered to sell, assign, and
deliver the whole or any part of the Collateral at public or private sale,
without demand, advertisement or notice of the time or place of sale or of any
adjournment thereof, which are hereby expressly waived. After deducting all
expenses incidental to or arising from such sale or sales, Holder may apply the
residue of the proceeds thereof to the payment of the Indebtedness, as it shall
deem proper, returning the excess, if any, to the undersigned. The undersigned
hereby waives all right of redemption or appraisement whether before or after
sale.
Holder is further empowered to collect or cause to be collected or
otherwise to be converted into money all or any part of the Collateral, by suit
or otherwise, and to surrender, compromise, release, renew, extend, exchange,
or substitute any item of the Collateral in transactions with the undersigned
or any third party, irrespective of any assignment thereof by the undersigned,
and without prior notice to or consent of the undersigned or any assignee.
Whenever any item of the Collateral shall not be paid when due, or otherwise
shall be in default, whether or not the indebtedness, or any part thereof, has
become due, Holder shall have the same rights and powers with respect to such
item of the Collateral as are granted in this paragraph in case of nonpayment
of the Indebtedness, or any part thereof, when due. None of the rights,
remedies, privileges, or powers of Holder expressly provided for herein shall
be exclusive, but each of them shall be cumulative with and in addition to
every other right, remedy, privilege, and power now or hereafter existing in
favor of Holder, whether at law or equity, by statute or otherwise.
The undersigned agrees to take all necessary steps to administer,
supervise, preserve, and protect the Collateral; and regardless of any action
taken by Holder, there shall be no duty upon Holder in this respect. The
undersigned shall pay all expenses of any nature, whether incurred in or out of
court, and whether incurred before or after this Note shall become due at its
maturity date or otherwise, including but not limited to reasonable attorney's
fees and costs, which Holder may deem necessary or proper in connection the
with the satisfaction of the Indebtedness or the administration, supervision,
preservation, protection of (including, but not limited to, the maintenance of
adequate insurance) or the realization upon the Collateral. Holder is
authorized to pay at any time and from time to time any or all of such
expenses, add the amount of such payment to the amount of the Indebtedness, and
charge interest thereon at the rate specified herein with respect to the
principal amount of this Note.
The security rights of Holder and its assigns hereunder shall not be
impaired by Holder's sale, hypothecation or rehypothecation of any note of the
undersigned or any item of the Collateral, or by any indulgence, including but
not limited to (a) any renewal, extension, or modification which Holder may
grant with respect to the Indebtedness or any part thereof, or (b) any
surrender, compromise, release, renewal, extension, exchange. or substitution
which Holder may grant in respect of the Collateral, or (c) any indulgence
granted in respect of any endorser, guarantor, or surety. The purchaser,
assignee, transferee, or pledgee of this Note, the Collateral, and guaranty,
and any other document (or any of them), sold, assigned, transferred, pledged,
or repledged, shall forthwith become vested with and entitled to exercise all
the powers and rights given by this Note and all applications of the
undersigned to Holder or SBA as if said purchaser, assignee, transferee, or
pledgee were originally named as Payee in this Note and in said application or
applications.
SBA Form 147 (5-87) Page 2
Page 4.
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This promissory note is given to secure a loan which SBA is making or in
which it is participating and, pursuant to Part 101 of the Rules and
Regulations of SBA (13 C.F.R. 1O1.1(d)), this instrument is to be construed and
(when SBA is the Holder or a party in interest) enforced in accordance with
applicable Federal law.
Academic Book Center, Inc.
/s/ Daniel P. Halloran
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By: Daniel P. Halloran, President/Secretary
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Note. -- Corporate applicants must execute Note, in corporate name, by
duly authorized officer, and seal must be affixed and duly attested;
partnership applicants must execute Note in firm name, together with signature
of a general partner.
SBA Form 147 (5-87) Page 3
U.S. GOVERNMENT PRINTING OFFICE : 1993 0 - 348-951
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1. The undersigned will pay regular monthly payments of accrued unpaid
interest, beginning ONE (1) month from date hereof.
2. The undersigned shall pay (from proceeds of financed transactions) ON
DEMAND, or if no demand, then on or before TWELVE (12) months from the
date of this Note the total principal amounts advanced by Lender from time
to time, plus interest as herein provided. No advance shall be made under
this Note if, as a result of such advance, the total principal amount
outstanding hereunder would exceed the sum of $650,000.00.
3. THIS IS A VARIABLE INTEREST RATE NOTE. Interest on each principal advance
shall accrue at the initial rate of ELEVEN AND ONE HALF percent (11.5%)
per annum. The interest rate will be adjusted in accordance with the
prime published in the Money Rate Section of the Western Edition of the
Wall Street Journal. The prime rate published as of May 12, 1995 in that
publication was nine percent (9%). The interest rate (spread) to be added
to the prime rate at the beginning of the adjustment period will be two
and one half percent (2.5%).
4. Each adjustment period will be 24 hours or less after the prime rate
change.
5. The Lender should give the undersigned and SBA written notice of any
change in the interest rate of this Note within thirty (30) days after the
effective date of any such change. The fluctuation of the interest rate
is not contingent on whether or not notice is given.
6. If the undersigned shall be in default in payment due on the indebtedness
herein and the Small Business Administration (SBA) purchases its
guaranteed portion of said indebtedness, the rate of interest on both the
guaranteed and unguaranteed portionless herein shall become fixed at the
rate in effect as of the first date of uncured default. If the
undersigned shall not be in default in payment when SBA purchases its
guaranteed portion, the rate of interest on both the guaranteed and
unguaranteed portion shall be fixed at the rate in effect as of the date
of purchase by SBA.
7. Upon prepayment of this Note, Lender is entitled to the following
prepayment privilege penalty: 1/2 of 1% of Note amount ($650,000.00).
There shall be no prepayment premium if the Note is paid in accordance
with its original terms.
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