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EXHIBIT 2.2
$1,234,832 Atlanta, Georgia
February 15, 1999
PROMISSORY NOTE
FOR VALUE RECEIVED, the undersigned (hereinafter sometimes referred to
as "Maker"), promises to pay to the order of U.S. Technologies Inc. ("UST"), a
Delaware corporation, its successors and assigns, including any subsequent
assignee or holder of this Note, hereinafter referred to, collectively, as
"Holder", at its principal office at 3901 Roswell Road, Suite 300, Marietta,
Georgia 30062, or at such other place or to such other person or persons as
Holder shall designate in writing, the principal sum of One Million Two Hundred
Thirty-four Thousand Eight Hundred Thirty-two and No/100 Dollars
($1,234,832.00), with interest thereon.
This Note is secured by and is subject to the benefits and security
provided by, and the terms and conditions of, that certain stock pledge and
guaranty agreement, by and between Maker and UST, of even date herewith ("Smith
Pledge Agreement"), and that certain stock pledge agreement, by and between GWP,
Inc. and UST, of even date herewith ("GWP Pledge Agreement") as well as the
relevant terms of that certain severance agreement entered into between Maker
and UST on February 11, 1999 ("Severance Agreement").
Interest shall be computed on the outstanding balance from day to day
on the basis of actual days elapsed, and a year of 360 days consisting of 12
months having 30 days each, at the prime rate (as published from time to time in
the Wall Street Journal) plus 200 basis points. The interest accrued hereunder
shall be payable in quarterly installments, beginning on the fifteenth (15th)
day of August, 1999, six months following the date of this Note, and in the
amount of the accrued interest thereon to date, and, thereafter, continuing on
the fifteenth (15th) day of the first month of each succeeding three-month
period until all principal, interest, penalties and other charges, if any, due
and payable hereunder have been paid in full.
The principal hereunder shall be repaid in equal installments of
$411,610.67, payable at the end of each 12-month period, beginning on the date
of this Note. The principal amount of this Note and any accrued unpaid interest
shall be due and payable in full on the fifteenth (15th) day of February, 2002.
Payments, as made, shall be applied first to the payment of accrued but
unpaid interest, then to penalties and late charges, if any, and the balance of
said payments shall be applied to principal. Principal, interest, penalties and
late charges shall be payable in lawful money of the United States
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of America. All interest and principal payments shall be made by federal wire
funds or checks issued by a United States commercial bank or a United States
savings bank.
Maker shall be permitted to prepay the Note, in part or in full,
together with accrued and unpaid interest to the date of such prepayment, and
all other accrued but unpaid late charges or penalties, if any, without premium
or penalty for such prepayment.
Should a default occur under any of the terms and conditions contained
herein, and in any such event, the entire unpaid principal sum evidenced by this
Note, with all accrued and unpaid interest then due, shall, at the option of the
Holder and without notice or demand, except as expressly provided in this Note,
become due and may be collected forthwith pursuant to the terms of the Pledge
Agreement, time being of the essence of this Note. It is further agreed that the
failure of Holder to exercise this right of accelerating the maturity of the
debt, or indulgence granted from time to time, shall in no event be considered
as a waiver of such right of acceleration or estop the holder from exercising
such right.
If a default shall occur under this Note, as a result of a failure by
Maker to pay when due any sum of money required to be paid by this Note, Holder
shall not exercise any of its rights and remedies under this Note without first
giving to Maker written notice of such monetary default and an opportunity for
five (5) calendar days following the date of such notice by Holder to cure such
monetary default. If any other default, not involving nonpayment by Maker of a
sum of money, shall occur under this Note, Holder shall not exercise any of its
rights and remedies under this Note without first giving to Maker written notice
of such non-monetary default and an opportunity for fifteen (15) calendar days
following the date of such notice by Holder to cure such non-monetary default.
Notwithstanding the foregoing, Holder shall have no obligation to give more than
one (1) monetary default notice or more than one (1) non-monetary default
notices for a non-monetary default in any 365 day period.
Default events under this Note shall include the following:
1. Failure to pay any indebtedness evidenced by this Note,
whether for principal or interest, when such indebtedness
becomes due for whatever reason;
2. Failure of Technology Manufacturing & Design, Inc., a Texas
corporation ("TMD") (51% of the voting shares of which are
owned by GWP, Inc., a Georgia company which is wholly-owned by
Maker) to satisfy or perform, fully, promptly, and completely,
its obligations pursuant to the November 30, 1998 Loan and
Security Agreement between TMD and Fidelity Funding, Inc., or
pursuant to the Agreement of Non-Dilution between TMD and UST
(the "TMD Non-Dilution Agreement");
3. Failure of TMD to satisfy and perform, fully, promptly, and
completely, the purchase price payment to the minority
shareholders of TMD pursuant to Section 8.2 of the
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Amended and Restated Stock Purchase Agreement between TMD and
GWP, Inc., dated as of October 5, 1998.
4. The occurrence of any event of default, or the occurrence of
any event which, upon the passage of time, would constitute an
event of default, under any agreement between the Maker and
UST, between GWP, Inc. and UST, or between TMD and UST,
including, but not limited to, the Smith Pledge Agreement, the
GWP Pledge Agreement, the Severance Agreement and the TMD
Non-Dilution Agreement.
Should this Note be collected by law or through an attorney-at-law, all
costs of collection, including reasonable attorneys' fees actually incurred,
shall be paid by Maker.
Notwithstanding any provision contained herein, the total liability of
Maker for payment of interest, including late charges or other fees pursuant to
this Note, or any other instrument evidencing the indebtedness evidenced by this
Note, shall not exceed the maximum amount of such interest permitted by
applicable law to be charged, and if any payments by Maker include interest in
excess of such maximum amount, Holder shall apply such excess to the reduction
of the unpaid principal amount due pursuant hereto.
All notices, requests, demands and other communications required or
permitted to be given hereunder shall be sufficient if in writing and delivered
in person (including by overnight courier service) or sent by United States
Certified Mail, return receipt requested, postage prepaid, to the party being
given such notice at the following addresses:
Maker: Kenneth H. Smith
2310 Edgemere Lake Circle
Marietta, Georgia 30062
Holder: U.S. Technologies Inc.
3901 Roswell Road, Suite 300
Marietta, GA 30062
Any party may change said address for notice to another address in the
continental United States by giving the other party hereto thirty (30) days
prior written notice of such change of address. Notice given as herein provided
above shall be deemed given on the date of its deposit (via certified mail) in
the United States mail or delivery in person, as the case may be, and, unless
sooner received, shall be deemed received by the party to whom it is addressed
on the fifth calendar day following the date on which said notice is deposited
in the mail. Refusal to accept delivery of any notice or inability to deliver
notice as a result of an address change of which no notice is given shall be
deemed receipt.
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Maker hereby waives and renounces for itself and its legal
representatives, successors and assigns, all rights to the benefits of any
statute of limitations and any moratorium, reinstatement, marshaling,
forbearance, valuation, stay, extension, redemption, appraisement, exemption and
homestead now provided, or which may hereafter be provided, by the Constitution
and laws of the United States of America and of any state thereof, against the
enforcement and collection of the obligation evidenced by this Note.
This Note shall be governed by, enforced and interpreted in accordance
with the laws of the State of Georgia.
The word "undersigned," as used herein, shall include the successors
and permitted assigns of Maker. The word "Holder" as used herein shall include
any transferees and assignees of Holder, and all rights of Holder shall inure to
the benefit of the successors and assigns of Holder.
IN WITNESS WHEREOF, Maker has executed and sealed this Note the day and
year first above written.
MAKER:
/s/ Kenneth H. Smith (SEAL)
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Kenneth H. Smith
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