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EXHIBIT 10.9
Chicago, Illinois, January 26, 1998 $250,000
AASCHE TRANSPORTATION SERVICES, INC.
14% SENIOR SUBORDINATED PROMISSORY NOTE
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR UNDER THE TRUST INDENTURE ACT OF 1939 AND MAY NOT BE SOLD,
PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED WITHOUT COMPLIANCE WITH THE
REGISTRATION OR QUALIFICATION PROVISIONS OF APPLICABLE FEDERAL AND STATE
SECURITIES LAWS OR APPLICABLE EXEMPTIONS THEREFROM.
FOR VALUE RECEIVED, Aasche Transportation Services, Inc., a Delaware corporation
(the "Company"), promises to pay to Gary I. Goldberg, the registered holder or
registered assigns hereof (the "Holder"), the principal amount of Two Hundred
Fifty Thousand Dollars ($250,000) payable on August 1, 1999 (the "Maturity
Date"), together with accrued interest on the outstanding principal amount of
this Note (the "Note") at the annual rate calculated on the basis of the actual
number of days elapsed over a year of 360 days, of fourteen percent (14%)
through the Maturity Date, such interest to be payable in full on the Maturity
Date. In the event that any payment of principal and/or interest hereunder is
not paid when due as provided for herein, and without affecting any of the
Holder's other rights and remedies, the unpaid principal balance hereof shall
thereafter accrue interest at the default rate specified in Section 6 of this
Note.
1. Payments and Prepayments.
(a) Payments of principal and/or interest on this Note shall be made
at the principal office of the Company, located at 10214 N. Mt. Vernon Road,
Shannon, Illinois 61078, or such other place or places within the United States
as may be specified by the Holder of this Note in a written notice to the
Company at least ten (10) business days before a given payment date.
(b) Payment of principal and interest on this Note shall be made in
lawful money of the United States of America by mailing the Company's check in
the proper amount to the Holder at least three days prior to the due date of the
payment or otherwise transferring good funds so as to be received by the Holder
on the due date of the payment.
(c) This Note is subject to prepayment, in whole or in part, at the
option of the Company without premium or penalty at any time.
(d) The Company will give the Holder written notice indicating the
amount of any prepayment and the proposed date thereof not less than fifteen
(15) days prior to any such prepayment of this Note.
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2. Obligation Absolute. The obligations under this Note are absolute
and unconditional obligations of the Company and no modification, release,
consent, waiver, rearrangement or amendment shall impair the obligations of the
Company hereunder.
3. Security. The payment of this Note and the Company's obligations
hereunder are not secured by any collateral.
4. Registration, Exchange and Transfer. The Company will keep a
register in which, subject to such reasonable regulations as it may prescribe,
it will register all Notes. No transfer of this Note shall be valid as against
the Company unless made upon the register. This Note is subject to the
restrictions on transfer of this Note and in compliance with said restrictions
on transfer, the Company shall execute and deliver in the name of the transferee
or transferees a new Note or Notes for a like principal amount.
Subject to Section 7, this Note may be exchanged for like notes in the
same aggregate principal amount in other denominations; provided, however, that
none of the Notes shall be in denominations less than $100,000. To be exchanged,
this Note shall be surrendered for that purpose at the principal office of the
Company, and the Company shall execute and deliver in exchange therefor the Note
or Notes which the holder making the exchange shall be entitled to receive,
bearing serial numbers not contemporaneously outstanding.
This Note, if presented for transfer, exchange, redemption or payment,
shall (if so required by the Company) be duly endorsed by, or be accompanied by
instruments of transfer in form satisfactory to the Company duly executed by,
the registered Holder or by such Holder's duly authorized attorney.
The Company may deem and treat the registered Holder hereof as the
absolute owner hereof (whether or not this Note shall be overdue and
notwithstanding any notation of ownership or other writing hereon by anyone
other than the Company), for the purpose of receiving payment of or on account
of the principal hereof and interest hereon, and for all other purposes, and the
Company shall not be affected by any notice to the contrary.
5. Events of Default. In the event that:
(i) the Company defaults in making the payment of principal and all
accrued interest on this Note at the Maturity Date;
(ii) the Company hereafter makes an assignment for the benefit of
creditors, or files a petition in bankruptcy as to itself, is adjudicated
insolvent or bankrupt, petitions any receiver or of any trustee for the
Company or any substantial part of the property of the Company under any
bankruptcy, reorganization, arrangement, readjustment of debt, dissolution
or liquidation law or statute of any jurisdiction, whether or not
hereafter in effect; or if there is hereafter commenced against the
Company any such proceeding and an order approving the petition is entered
or such proceeding remains undismissed for a period of sixty (60) days, or
the Company by any act or omission to act indicates its consent to or
approval of or acquiescence in any such proceeding or the appointment of
any receiver of, or trustee for, the Company or any substantial part of
its properties, or suffers any such receivership or trusteeship to
continue undischarged for a period of sixty (60) days; or
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(iii) the Company defaults in the due observance or performances, in
any material respect, of any covenant, condition or agreement to be
observed or performed pursuant to the terms of this Note (other than a
default which is specifically provided for in this Section 5) and such
default continues unremedied for more than thirty (30) days after the
Company has received written notice thereof;
Then, and in each and every case, the holder of the Note may declare the
principal and accrued but unpaid interest of the Note to be due and payable
immediately, by written notice to the Company, and upon any such declaration the
same shall become and shall be immediately due and payable.
6. Certain Consequences Upon Default. If and during such time as an
Event of Default has occurred and is continuing, the Company shall on demand
from time to time pay interest, to the extent permitted by law, on such
defaulted amount up to (but not including) the date of actual payment (whether
before or after judgment) at the rate per annum (computed on the basis of the
actual number of days elapsed over a year of 360 days) equal to the sum of the
rate set forth in the introduction of this Note plus two percent (2%). It is the
intention of the Company and the Holder of this Note to comply with applicable
usury laws (now or hereafter enacted); accordingly, notwithstanding any
provision to the contrary in this Note, and any other document executed in
connection herewith, in no event shall this Note or any such other document
require the payment or permit the collection of interest in excess of the
maximum amount permitted by such laws. If for any circumstances whatsoever,
fulfillment of any provision of this Note or of any such other document at the
time performance of such provision shall be due, shall involve transcending the
limit of validity prescribed by law for the collection or charging of interest,
then, ipso facto, the obligation to be fulfilled shall be reduced to the limit
of such validity, and if for any such circumstances the holder of this Note
shall ever receive anything of value as interest or deemed interest by
applicable law under this Note or any such other document or otherwise an amount
that would exceed the highest lawful rate, such amount that would be excessive
interest shall be applied to the reduction of the principal amount owing under
this Note or on account of any other indebtedness of the Company to such holder,
and not to the payment of interest, or if such excessive interest exceeds the
unpaid balance of principal of such indebtedness, such excess shall be refunded
to the Company. In determining whether or not the interest paid or payable with
respect to any indebtedness of the Company to the Holder, under any specific
contingency, exceeds the highest lawful rate, the Company and such holder shall,
to the maximum extent permitted by applicable law, (i) characterize any
non-principal payment as an expense, fee or premium rather than as interest,
(ii) exclude voluntary prepayments and the effects thereof, (iii) amortize,
prorate, allocate and spread the total amount of interest throughout the full
term of such indebtedness so that the actual rate of such interest does not
exceed the maximum amount permitted by applicable law, and/or (iv) allocate
interest between portions of such indebtedness, to the end that no such portion
shall bear interest at a rate greater than that permitted by applicable law.
7. Investment Representations.
(a) The Holder hereby acknowledges that this Note is not being
registered (i) under the Securities Act of 1933, as amended (the "Act") or under
the Trust Indenture Act of 1939 (the "Trust Indenture Act") on the ground that
the issuance of the Note is exempt from registration under
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Section 4(2) of the Act as not involving any public offering or (ii) under any
applicable state securities law because the issuance of this Note does not
involve any public offering; and that the Company's reliance on the Section 4(2)
exemption of the Act and under applicable state securities laws is predicated in
part on the representations hereby made to the Company by the Holder that it is
acquiring this Note for investment for its own account, with no present
intention of dividing its participation with others or reselling or otherwise
distributing the same.
(b) The Holder hereby agrees that it will not sell or transfer all or
any part of this Note unless and until it shall first have given written notice
to the Company describing such sale or transfer and furnished to the Company
either (i) an opinion, reasonably satisfactory to counsel for the Company, of
counsel (skilled in securities matters, selected by the Holder and reasonably
satisfactory to the Company) to the effect that the proposed sale or transfer
may be made without registration under either the Act or the Trust Indenture Act
and without registration or qualification under any state law, or (ii) an
interpretive letter from the Securities and Exchange Commission to the effect
that no enforcement action will be recommended if the proposed sale or transfer
is made without registration under the Act or the Trust Indenture Act.
(c) The Company may refuse to recognize a transfer of this Note on its
books should a holder attempt to transfer this Note otherwise than in compliance
with this Section 7.
8. Notices. Any notice required by the provisions of this Note shall be
in writing and shall be delivered by hand, by telecopier, by overnight courier
or mailed by first class, registered or certified mail, postage prepaid, at such
address as may have been furnished to the Company in writing by such Holder, or,
until any such Holder furnishes to the Company an address, then to, and at the
address of, the last Holder of this Note who has so furnished an address to the
Company.
9. Miscellaneous.
(a) This Note is the obligation of the Company only, and no recourse
shall be had for the payment thereof or interest thereon against any
shareholder, officer or director of the Company, whether by virtue of any
constitution, statute, rule or law or otherwise, such liability, by the
acceptance hereof, and as part of the consideration hereof, being expressly
waived.
(b) Upon receipt of evidence reasonably satisfactory to the Company the
loss, theft, destruction or mutilation of this Note and of a letter of indemnity
reasonably satisfactory to the Company, and upon reimbursement to the Company of
all reasonable expenses incident thereto, and upon surrender or cancellation of
this Note, if mutilated, the Company will make and deliver a new Note of like
tenor in lieu of such lost, stolen, destroyed or mutilated Note.
(c) THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE COMPANY AND
THE HOLDER HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY
THE LAWS OF THE STATE OF ILLINOIS APPLICABLE TO AGREEMENTS AND INSTRUMENTS MADE
AND TO BE PERFORMED IN ILLINOIS AND CANNOT BE MODIFIED OR CHANGED ORALLY.
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IN WITNESS WHEREOF, the Company has duly caused this Note to be signed
on its behalf, in its name and by its duly authorized officers as of this 26th
day of January, 1998.
AASCHE TRANSPORTATION SERVICES, INC.
By: /s/ Leon M. Monachos
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Leon M. Monachos, Chief Financial Officer
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