EXHIBIT 10.9
Peoples Bank Master Note
Newton, NC 28658 SIMPLE INTEREST
PROMISSORY NOTE
Debtor(s): Loan Number 101700200
SAGEBRUSH, INC. Date 05/14/1997
SAGEBRUSH OF NORTH CAROLINA, LLC Loan Amount $850,000.00
PO BOX 730
CLAREMONT, NC 28610
FOR MONEY BORROWED the undersigned (hereinafter "debtor" whether one or
more), jointly and severally, promises to pay to PEOPLES BANK
(hereinafter "Bank"), or order, at any office of Bank, the principal sum
of Eight Hundred Fifty Thousand and 00/100 Dollars ($850,000.00), plus
interest from and including May 14, 1997 at the rate of Prime Rate
(8.250%) per year, on the unpaid balance until paid.
All interest calculations shall be based on a 360 day year.
Payment shall be made as follows: PAYABLE IN CONSECUTIVE MONTHLY PAYMENT
OF $10,775.00 EACH, FIRST APPLIED TO ACCRUED INTEREST, BEGINNING JUNE
25, 1997 AND EACH MONTH THEREAFTER WITH ALL UNPAID PRINCIPAL AND ACCRUED
INTEREST DUE MAY 25, 2007.
In the event periodic accruals of interest shall exceed the periodic
fixed payment amount, the fixed payment amount shall be immediately
increased, or additional supplemental payments required on the same
periodic basis as specified herein (increased fixed payments or
supplemental payments to be determined in the Bank's sole discretion),
in such amounts and at such times as shall be necessary to pay all
accruals of interest for the period and all accruals of unpaid interest
from previous periods. Such adjustments to the fixed payment amount or
supplemental payments shall remain in effect for so long as the interest
accruals shall exceed the original fixed payment amount and shall be
further adjusted upward or downward to reflect changes in the variable
interest rate. In no event shall the fixed payment amount be reduced
below the original fixed payment amount specified above.
X This Promissory Noted is secured by DEED OF TRUST AND SECURITY
AGREEMENT dated 05/14/1997.
As security for the payment of all present, existing or future debts to
Bank, Debtor hereby grants to Bank a security interest in all amounts on
deposit with the Bank or owed to Debtor by the Bank. The time for making
payments is of the essence. Unless otherwise agreed or required by law,
each payment shall be applied in such order and manner as the Bank may
elect to unpaid interest, fees, premiums, other charges and to
principal. Prepayments may, at the Bank's discretion, be applied in
reverse order of the dates periodic payments are due.
The amount of any final payment or the number of payments required to
pay the indebtedness in full may differ from any payment schedule
disclosed since the schedule contemplates that all amounts will be paid
on exact due dates, and interest will accrue daily on the principal
balance outstanding. If this obligation has a variable rate, the payment
schedule may be affected by a change in the interest rate; however,
notwithstanding any such change the rate will not exceed the highest
rate permitted by law. When used as a variable rate, Peoples Bank's
Prime Rate means the "Prime Rate" designated by the Bank as Peoples
Bank's Prime Rate, and not necessarily the lowest rate charged by the
Bank to others. Where this obligation contains a variable rate it is
agreed that the rate will change on the date of any change in the
Peoples Bank's Prime Rate, and the annual percentage rate during the
term of the loan will not exceed n.a. % per annum, or the maximum rate
allowed by law.
The following shall be grounds for declaration of default: (a) failure
of any Debtor to pay any amount due to the Bank as agreed, (b) failure
of any Debtor to comply with any other obligation to the Bank, (c) the
death, or declaration of incompetency, of any individual Debtor (or the
dissolution, merger or reorganization of any corporate Debtor), (d) loss
or destruction of any collateral securing payment to the Bank, (e) the
filing of any petition in bankruptcy or insolvency by or against any
Debtor, (f) determination by the Bank that any information supplied to
the Bank by the Debtor in connection with this credit is materially
false or incomplete, (g) determination by the Bank that the prospect of
payment of this obligation is impaired, or (h) if the Bank deems itself
insecure. Upon determination by the Bank of the existence of any such
ground for default, the Bank may, without notice, declare all amounts
due hereunder, and under any other obligation to the Bank, immediately
due and payable. Any failure of the Bank to declare a default, or to
otherwise exercise any right or remedy available to it, shall not
constitute a waiver by the Bank of any such right or remedy. All amounts
due to the Bank after the Bank declares Debtor in default, shall bear
interest at the maximum rate allowed by law, but if there is no such
maximum, then at Prime Rate per annum until paid.
Upon default, Debtor agrees to pay the Bank such reasonable attorney
fees as may be allowed by law, plus all other expenses reasonably
incurred by the Bank (including attorney fees) in exercising its rights
or remedies, enforcing its rights against others, or in storing,
protecting, or repossessing any collateral.
Unless this Promissory Note is payable in a single payment, and not by
installments of interest or principal and interest, Debtor agrees to pay
a late fee of 4.00% of the amount of any payment past due for 15 days or
more.
All parties to this Promissory Note, including each Debtor and any
sureties, endorsers, or guarantors hereby waive protest, presentment,
notice of dishonor and all other notices required by law. All parties
agree to remain bound hereunder notwithstanding any release of other
parties, the release or surrender of collateral, or any extension of
time for payment.
IN TESTIMONY WHEREOF, as of the day and year first above written, each
individual Debtor has hereunto set his hand and adopted as his seal the
word "SEAL" appearing beside his name, and each corporate Debtor has,
pursuant to proper corporate authority, caused this Promissory Note to
be executed by its President.
SAGEBRUSH OF NORTH CAROLINA, LLC
By: /s/ L. Dent Miller
Member
SAGEBRUSH, INC.
/s/ Gary E. Abernethy By: /s/ L. Dent Miller
Attest Asst. Secretary President