EXHIBIT 10.4
PROMISSORY NOTE
$132,000.00 Memphis, Tennessee
November 11, 1997
FOR VALUE RECEIVED, the undersigned, JAMES M. O'DELL, (the "Maker"),
promises to pay to the order of CORTELCO SYSTEMS, INC. (the "Lender"), the
principal sum of One Hundred Thirty Two Thousand and 00/100 Dollars
($132,000.00), together with interest as set out below.
Said principal shall be due in two equal installments, the first, for one
half of the outstanding principal due on the first anniversary date of this Note
and the second for the remaining outstanding principal, due on the second
anniversary date of this Note. In the event that this Note is paid pursuant to
the preceding sentence, this Note will be non interest hearing. In the event
that this Note is not paid in compliance with the foregoing, the Lender shall
have the right to demand payment in full of all outstanding principal, with
interest from the date hereof to the date of payment, at the maximum effective
contract rate of interest which the Lender may lawfully charge under applicable
statutes and laws in effect at the time of such demand.
In the event that the Maker shall at any time not be an employee of the
Lender, the Lender shall have the right to demand payment of this Note, which
shall include all principal, fees and expenses and interest loss associated
herewith.
Any payment not made when due and, in the event of the acceleration of the
indebtedness evidenced hereby by reason of the Maker's default, the entire
unpaid principal balance hereof, shall bear interest after maturity at the
maximum effective contract rate of interest which the Lender may lawfully charge
under applicable statutes and laws in effect at the time of any such default.
All installments of both principal and interest on this Note are payable at
4119 Willow Lake Boulevard, Memphis, Tennessee 38118, or at such other place as
the holder may designate in writing, in lawful money of the United States of
America, which shall be legal tender in payment of all debts and dues, public
and private, at the time of payment.
If the Maker shall fail to make payment of any installment of principal of
interest, or any part thereof as above provided, or upon any default in the
terms and provisions of any trust deed, mortgage, security agreement,
assignment, or other instrument of pledge or hypothecation which now or
hereafter secures the payment of the indebtedness evidenced hereby, then and in
any of such events, the entire unpaid principal balance of the indebtedness
evidenced hereby, together with all interest then accrued, shall, at the
absolute option of the Lender, at once become due and payable, without demand or
notice, the same being expressly waived.
1.
If this Note is placed in the hands of an attorney, for collection by suit
or otherwise, or to protect the security for its payment, or to enforce its
collection, or to represent the rights of the Lender in connection with any loan
documentation executed in connection herewith, or to defend successfully against
any claim, cause of action or suit brought by the Maker against the Lender, the
Maker shall pay on demand all costs of collection and litigation (including
court costs), together with a reasonable attorney's fee.
The Maker and any endorsers or guarantors hereof waive protest, demand,
presentment and notice of dishonor, and agree that this Note may be extended, in
whole or in part, without limit as to the number of such extensions, or the
period or periods thereof, and without notice to them and without affecting
their liability thereon.
The privilege is reserved and given to make additional payments on the
principal of this Note, without penalty, at any time.
If the Maker shall at any time not be an employee of the Lender, Lender
shall have the right of appropriation or set off of any moneys, accounts or
credits owed by the Lender to Maker or property of Maker in Lender's possession.
It is the intention of the Lender and the Maker to comply strictly with all
applicable usury laws; and, accordingly, in no event and upon no contingency
shall the Lender ever be entitled to receive, collect, or apply as interest any
interest, fees, charges, or other payments equivalent to interest, in excess of
the maximum rate which the Lender may lawfully charge under applicable statutes
and laws from time to time in effect, and, in the event that the holder hereof
ever receives, collects, or applies as interest, any such excess, such amount
which, but for this provision, would be excessive interest, shall be applied to
the reduction of the principal amount of the indebtedness evidenced hereby, and,
if the principal amount of the indebtedness evidenced hereby, and all lawful
interest thereon, is paid in full, any remaining excess shall forthwith be paid
to the Maker, or other party lawfully entitled thereto. All interest paid or
agreed to be paid by the Maker shall, to the maximum extent permitted by
applicable law, be amortized, prorated, allocated and spread throughout the full
period until payment in full of the principal, so that the interest hereon for
such full period shall not exceed the maximum amount permitted by applicable
law. Any provision hereof, or of any other agreement between the Lender and the
Maker, that operates to bind, obligate, or compel the Maker to pay interest in
excess of such maximum lawful contract rate shall be construed to require the
payment of the maximum rate only. The provisions of this paragraph shall be
given precedence over any other provision contained herein or in any other
agreement between the Lender and the Maker that is in conflict with the
provisions of this paragraph.
2.
This Note is shall governed and construed according to the internal
statutes and laws of the State of Tennessee, without reference to any conflicts
of law principles.
/s/ James M. O'Dell
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JAMES M. O'DELL
3.