[AMSOUTH BANK OF ALABAMA LOGO APPEARS HERE]
MASTER NOTE FOR BUSINESS AND COMMERCIAL LOANS
$10,000,000.00 Huntsville, Alabama
___________________ ___________________
June 1, 1996
___________________
FOR VALUE RECEIVED, the undersigned (hereinafter called, whether one or
more the "Borrower"), jointly and severally (if more than one) promises to pay
to the order of AmSouth Bank of Alabama, its successors and assigns (hereinafter
sometimes called the "Bank" and sometimes, together with any other holder of
this note, called "Holder"), at any office of Holder or at such other place as
Holder may from time to time designate, the sum of TEN MILLION AND 00/1000******
_____________________________
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________________________________________________________________________________
($10,000,000.00**********), or so much thereof as the Bank has advanced to the
Borrower hereunder (the "Loan"), plus interest from the date hereof until
maturity (whether by acceleration or otherwise) on the outstanding unpaid
principal balance of the Loan, at the rate of [check (1), (2) or (3)]:
[ ] (1)__________% per annum
[ ] (2)__________% per annum in excess of the prime rate of the Bank in
effect from time to time as designated by the Bank (the "Prime
Rate"), with changes in the interest rate on this note caused by
changes in the Prime Rate to take effect on the date the Prime
Rate changes without notice to the Borrower or any other action
by Holder:
[X] (3)30 day LIBOR RATE + 87.5 basis points as listed in the
Wall Street Journal
Interest will be computed on the basis of the actual number of days
elapsed over (check one) [X] an assumed 360-day year, [ ] a 365-(or 366-, if
leap year) day year.
If none of the foregoing provisions for a rate of interest is checked,
the rate of interest payable on the Loan until maturity (whether by acceleration
or otherwise) shall be the Prime Rate of the Bank in effect from time to time,
or such lesser rate as shall be the maximum permitted by law, computed on the
basis of the actual number of days elapsed over an assumed 360-day year.
Notwithstanding anything to the contrary contained in this note, the
amount paid or agreed to be paid as interest on the principal amount of the Loan
shall never exceed the highest lawful rate allowed under applicable law. If at
any time, interest is due to be paid in an amount that exceeds the highest
lawful rate, then the obligation to pay interest hereunder shall be reduced to
the highest lawful rate. If at any time, interest is paid in an amount that is
greater then the highest lawful rate, then the amount that exceeds the highest
lawful rate shall be deemed to have been a prepayment of principal of the Loan
and applied to principal in the manner hereinafter provided, or if the excessive
amount of interest exceeds the unpaid principal balance, the excess shall be
refunded to the Borrower.
The Borrower hereby agrees to repay principal and interest as follows:
The Borrower will pay the principal amount of the Loan (check one and
complete if applicable):
[ ] on demand, [X] 365 days after date, or
[ ] ___________________________________________________________________
___________________________________________________________________
and will pay the interest on the Loan (check one and complete if
applicable):
[ ] at maturity, [X] in monthly installments on the 1st day of each
month, and at maturity
[ ] In quarterly installments on the _____ day of each _________________
______________________, and ________________________________________
and at maturity or
[ ] ____________________________________________________________________
____________________________________________________________________
For purposes of sending periodic billing statements in advance of each
interest payment date, at the Holder's option, the Prime Rate in effect 15 days
prior to each interest payment date shall be deemed to be the Prime Rate that
continues in effect until the date prior to such interest payment date for
purposes of computing the amount of interest payable on such interest payment
date. If the Prime Rate changes during such 15-day period, the difference
between the amount of interest that in fact accrues during such period and the
amount of interest actually paid will be added to or subtracted from, as the
case may be, the interest otherwise payable in preparing the periodic billing
statement for the next succeeding interest payment date. In determining the
amount of interest payable at the final maturity or upon full prepayment of this
Master Note, all changes in the Prime Rate occurring on or prior to the day
before the final maturity date or the date of such full prepayment shall be
taken into account.
If none of the foregoing provisions for the repayment of principal
and/or interest is checked, the principal, if not checked, and interest, if not
checked, due hereunder shall be payable on demand of Holder.
If permitted under applicable law, the Borrower agrees to pay to Holder,
on demand, a late charge. This late charge will be 5% of any installment that is
not paid within 12 days after it is due and will be 5% of the interest portion
of the payment due upon the final maturity date of this note if that payment is
not paid within 12 days after it is due. This late charge will never be less
than $10 nor more than $250 on each payment. This provision shall not be deemed
to excuse a late payment or be deemed a waiver of any other right Holder may
have, including, without limitation, the right to declare the entire unpaid
principal and interest immediately due and payable.
All payments coming due on this Master Note shall be made in cash or
immediately available funds at the Holder's office at which the payment is made.
At its option, the Holder may elect to give the Borrower credit for any payment
made by check or other instrument in accordance with the Holder's availability
schedule in effect from time to time for such items and instruments, which the
Holder will make available to the Borrower on request. Each payment on the
indebtedness evidenced hereby will first reduce charges owed by the Borrower
that are neither principal nor interest. The remainder of each payment will be
applied first to accrued but unpaid interest and then to unpaid principal. Any
partial prepayments of principal will be applied to installments due in the
inverse order of their maturity and no such partial prepayment of principal will
have the effect of postponing, satisfying, reducing, or otherwise affecting any
scheduled installment before the principal of and interest on the Loan is, and
all other charges due hereunder are, paid in full.
This note is a master note, and it is contemplated that the proceeds of
the Loan evidenced hereby will be advanced from time to time to the Borrower by
Holder in installments as requested by the Borrower and agreed to by Holder. It
is further contemplated that any amounts advanced under this note may be prepaid
from time to time by the Borrower and subsequently re-advanced by Holder, so
long as the principal amount outstanding does not exceed the face amount of this
note. By reason of prepayments hereon there may be times when no indebtedness is
owing hereunder, and notwithstanding any such occurrence, this note shall remain
valid and shall be in full force and effect as to each subsequent principal
advance made hereunder. The Holder shall maintain a record (by computer or
otherwise) of all principal advances and repayments under this Master Note and
that record shall be presumed to be correct in the absence of clear and
convincing evidence to the contrary.
Unless the Holder has otherwise agreed in writing, the Holder is not
obligated to make any advances or re-advances hereunder, and all advances and
re-advances shall be made at the option of Holder. This note shall be valid and
enforceable as to the aggregate amount advanced at any time hereunder, whether
or not the full face amount hereof is advanced.
If the Loan is payable on demand, this paragraph is inoperative and is
not applicable otherwise, this paragraph is operative and applies to the Loan in
accordance with its terms. In the event of default in the payment of any one or
more installments of principal or interest which may become due hereunder, when
and as the same fall due, or in the payment of all of principal and interest due
hereunder at maturity, or the failure of any maker, endorser, surety or
guarantor hereof (hereinafter called the "Obligors") to pay when due or perform
any of the Obligations (meaning thereby this note and any and all renewals and
extensions thereof and all other liabilities and indebtedness of the Borrower to
Holder, now existing or hereafter incurred or arising, direct or indirect, and
however incurred) or any part thereof or the failure of any Obligor to pay when
due any other liability to Holder, in the event a default occurs under the terms
of any loan agreement or other instrument (other than this note), document or
paper evidencing, securing, guaranteeing, or executed in connection with all or
any part of the Obligations (hereinafter, together with this note, collectively
called the "Loan Documents"), or in the event Holder shall in good faith deem
itself insecure for any reason, or on the happening of any one or more of said
events. Holder shall have the right at its election and without notice to any
Obligor to declare the Obligations immediately due and payable with interest to
date. No delay in making such election shall be construed to waive the right to
make such election. Holder may note the fact of acceleration hereon without
stating the ground therefor, and whether or not noted hereon such election to
accelerate shall be effective.
In the event of death of, insolvency of, general assignment by, judgment
against, filing of petition in bankruptcy by or against, filing a petition for
the reorganization of, filing of application in any court for receiver for or
issuance of a writ of garnishment or attachment in a suit or action against any
Obligor or against any of the assets of any Obligor, or on the happening of any
one or more of said events, the Obligations shall, without notice to or demand
upon any Obligor, immediately become due and payable with interest to date
unless Holder shall on notice of such event elect to waive such acceleration by
written notation hereon.
Each of the Obligors hereby severally (a) waives as to this debt or any
renewal or extension thereof all rights of exemption under the Constitution or
laws of Alabama or any other state as to personal property; (b) waives demand
(unless this notes is payable on demand), presentment, protest, notice of
protest, notice of dishonor, suit against any party and all other requirements
necessary to hold any Obligor liable; (c) agrees that time of payment may be
extended one or more times for any period of time (whether such period is
shorter or longer than the initial term of this note) or renewal notes taken or
other indulgence granted without notice of or consent to such action and without
release of liability as to any Obligor; (d) as to all or any part of the
Obligations, consents to Holder's releasing, agreeing not to sue, suspending the
right to enforce this instrument against or otherwise discharging or
compromising any Obligation of any Obligor or other person against whom any
Obligor has to the knowledge of Holder a right of recourse, all without notice
to or further reservations of rights against any Obligor, and all without in any
way affecting or releasing the liability of any Obligor; (e) consents to
Holder's releasing, exchanging or otherwise dealing in any manner with all or
any portion of any collateral, lien, or right of set-off which may now or
hereafter secure this note, all without notice to or further reservations of
rights against any Obligor, and all without in any way affecting or releasing
the liability of any Obligor, even though such release, exchange or other
dealing may in any manner and to any extent impair any such collateral, lien or
right to set-off; (f) agrees to pay all costs of collecting or securing or
attempting to collect or secure this note or defending any unsuccessful claim
asserted against the Holder in connection with this note, including reasonable
attorneys' fees; and (g) warrants that this Loan is for business, commercial or
agricultural purposes.
In addition to all liens upon, and rights of set-off against, any
monies, securities, or other property of any of the Obligors given to Holder by
law, Holder shall have a lien upon and a right of set-off against all monies,
securities and other property of any of the Obligors now or hereafter in the
possession of, or on deposit with, Holder, whether held in a general or special
account or deposit, for safekeeping, or otherwise; and every such lien and right
of set-off may be exercised without demand upon or notice to any Obligor, and
the Bank shall have no liability with respect to any of Obligor's checks or
other items which may be returned or other funds transfers which may not be made
due to insufficient funds thereafter.
The Borrower understands that the Bank may from time to time enter into
a participation agreement or agreements with one or more participants pursuant
to which such participant or participants shall be given participation in the
Loan and that such participants may from time to time similarly grant to other
participants sub-participations to the Loan. The Borrower agrees that any
participant may exercise any and all rights of banker's lien or set-off, whether
arising by operation of law or given to Holder by the provisions of this note,
with respect to the Borrower as fully as if such participant had made the Loan
directly to the Borrower. For the purposes of this Paragraph only, the Borrower
shall be deemed to be directly obligated to each participant or subparticipant
in the amount of its participating interest in the principal of, and interest
on, the Loan.
Neither any failure nor any delay on the part of Holder in exercising
any right, power or privilege under this note shall operate as a waiver thereof,
nor shall a single or partial exercise thereof preclude any other or further
exercise or the exercise of any other right, power or privilege. No
modification, amendment or waiver of any provisions of this note shall be
effective unless in writing and signed by a duly authorized officer of Holder,
and then the same shall be effective only in the specific instance and for the
purpose for which given. No notice to or demand on any Obligor in any case shall
entitle any Obligor to any other or further notice or demand in the same,
similar or other circumstances.
Any provision of this note which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction.
The provisions of this note shall inure to the benefit of the Holder,
its successors and assigns and shall be binding upon the heirs, successors and
assigns of each Obligor, except that no Obligor may assign or transfer his, her
or its obligation hereunder without the written consent of Holder.
All rights, powers and remedies of Holder under this note and now or
hereafter existing at law, in equity or otherwise shall be cumulative and may be
exercised successively or concurrently.
The Loan Documents contain the entire understanding and agreement
between the Borrower and the Holder with respect to the Loan and supersede any
and all prior agreements, understandings, promises, and statements with respect
to the Loan. This Master Note may not be modified, amended, or supplemented in
any manner except by a written agreement executed by both the Borrower and the
Holder.
This note shall be construed in accordance with and governed by the
laws of the State of Alabama.
This agreement is executed under seal by the Borrower or each of them.
CAUTION--IT IS IMPORTANT THAT YOU THOROUGHLY READ
THIS CONTRACT BEFORE YOU SIGN IT
NO. 0000387224-0000212522 XEP01 Adtran, Inc. [SEAL]
________________________________ ____________________________
Due May 31, 1997 By:/s/ MARK C. SMITH [SEAL]
________________________________ ____________________________
901 Explorer Blvd. Mark C. Smith
Huntsville, Alabama 35806 [SEAL]
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[SEAL]
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