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EXHIBIT 10.34
SECOND AMENDED AND RESTATED PROMISSORY NOTE
$125,000 February 28, 2000
FOR VALUE RECEIVED, the undersigned Borrower promises to pay to
TeleCommunication Systems, Inc. (the "Company") at its principal offices at 275
West Street, Suite 400, Annapolis, MD 21401 the principal sum of One Hundred
Twenty-Five Thousand dollars ($125,000.00), together with interest from the date
on this Note on the unpaid principal balance, upon the terms and conditions
specified below.
1. TERM. The principal balance of this Note, together with interest
accrued and unpaid to date, shall be due and payable at the close of business on
August 26, 2002; provided, however, that if Borrower remains an employee of
Company on August 26, 2001, then $83,334 of the principal amount together with
the accrued and unpaid interest thereon shall be forgiven and the obligation to
pay that amount will be extinguished. If the Borrower remains an employee on
August 26, 2002, then the remaining principal amount together with the accrued
and unpaid interest thereon shall be forgiven and the Note shall be cancelled
without repayment of any kind.
2. RATE OF INTEREST. Interest shall accrue under the Note on any unpaid
principal balance at the Applicable Federal Rate under Section 1274(d) of the
Internal Revenue Code, per annum, compounded annually.
3. PREPAYMENT. Prepayment of principal and interest may be made at any
time without penalty.
4. EVENTS OF ACCELERATION. The entire unpaid principal sum and unpaid
interest under this Note shall become immediately due and payable upon:
(a) The date when the Borrower ceases to be employed by Company;
(b) The occurrence of a material event of default under the Option
Pledge Agreement securing this Note or any obligation secured thereby.
5. SECURITY. Payment of this Note shall be secured by an Option Pledge
Agreement to be executed and delivered by the Borrower and covering shares of
the Company's Class B Common Stock. The Borrower, however, shall remain
personally liable for payment of this Note, and assets of the Borrower, in
addition to the collateral under the Option Pledge Agreement, may be applied to
the satisfaction of the Borrower's obligations hereunder.
6. COLLECTION. If action is instituted to collect this Note, the
Borrower promises to pay all reasonable costs and expenses (including reasonable
attorneys fees) incurred in connection with such action.
7. WAIVER. No previous waiver and no failure or delay by the Company or
the Borrower in acting with respect to the terms of this Note or the Option
Pledge Agreement shall constitute a waiver of any breach, default or failure of
condition under this Note, the Option
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Pledge Agreement or the obligations secured thereby. A waiver of any term of
this Note, the Option Pledge Agreement or of any of the obligations secured
thereby must be made in writing and signed by a duly authorized officer of the
Company and shall be limited to the express terms of such waiver.
The Borrower hereby waives presentment and demand for payment at such
time as the payments are due under the Note.
8. CONFLICTING AGREEMENTS. In the event of any inconsistencies between
the terms of this Note and the terms of any other document related to the loan
evidenced by the Note, the terms of the Note shall prevail.
9. GOVERNING LAW. This Note shall be construed in accordance with the
laws of the State of Maryland.
10.THIS SECOND AMENDED AND RESTATED PROMISSORY NOTE IS ISSUED IN
SUBSTITUTION AND REPLACEMENT FOR, BUT NOT IN PAYMENT OF, THAT CERTAIN FIRST
AMENDED AND RESTATED PROMISSORY NOTE DATED AUGUST 26, 2000 FROM THE BORROWER TO
TELECOMMUNICATION SYSTEMS, INC.
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Signature of Borrower
Timothy J. Lorello
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Borrower
1524 Sappington Drive
Gambrills, MD 21054