PROMISSORY NOTE
Principal Loan Date Maturity Loan No Call Collateral Account Officer Initials
$3,650,000 05-01-1998 04-15-2005 9006 252,0169434 M0089 MP
Borrower: Bowlin Outdoor Advertising & Travel Lender: Norwest Bank New Mexico, National Association
Centers, Incorporated Journal Center Business Banking
150 Louisiana NE P.O. Box 1081
Albuquerque, NM 87108 7412 Jefferson Blvd. NE
Albuquerque, NM 87109
Principal Amount: $3,650,000 Initial Rate: 8.50% Date of Note: May 1, 1998
PROMISE TO PAY. Bowlin Outdoor Advertising & Travel Centers, Incorporated
("Borrower") promises to pay to Norwest Bank New Mexico, National Association
("Lender"), or order, In lawful money of the United States of America, the
principal amount of Three Million Six Hundred Fifty Thousand & 00/100 Dollars
($3,650,000), together with Interest on the unpaid principal balance from May 1,
1998, until paid in full.
PAYMENT. Subject to any payment changes resulting from changes in the Index, the
Borrower will pay this loan in 84 payments of $57,819.47 each payment.
Borrower's first payment is due May 15, 1998, and all subsequent payments are
due on the same day of each month after that. Borrower's final payment will be
due on April 15, 2005, and will be for all principal and all accrued interest
not yet paid. Payments include principal and interest. The annual interest rate
on this Note is computed on a 365/366 basis; that is, by applying the ratio of
the annual interest rate over a year of 360 days, multiplied by the outstanding
principal balance, multiplied by the actual number of days the principal balance
is outstanding. Borrower will pay Lender at Lender's address shown above or at
such other place as Lender may designate in writing. Any regular payment will be
applied first to billed interest and then to principal, unless the Lender
determines (after an event of default or otherwise) that the regular payment
will be applied in some other manner or unless applicable law requires the
Lender to apply the payment in some other manner.
VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from
time to time based on changes in an independent Index which is the NORWEST BANK
MINNESOTA, N.A. BASE LENDING RATE (the 'Index'). The Index is not necessarily
the lowest rate charged by Lender on Its loans. If the Index becomes unavailable
during the term of this loan, Lender may designate a substitute index after
notice to Borrower. Lender will tell Borrower the current Index rate upon
Borrower's request. Borrower understands that Lender may make loans based on
other rates as well. The Interest rate change will not occur more often than
each QUARTER. The Index currently is 8.500% per annum. The Interest rate to be
applied to the unpaid principal balance of this Note will be at a rate equal to
the Index, resulting In an Initial rate of 8.500% per annum. NOTICE: Under no
circumstances will the interest rate on this Note be more than the maximum rate
allowed by applicable law. Whenever increases occur in the interest rate,
Lender, at its option, may do one of more of the following: (a) increase
Borrower's payments to ensure Borrower's loan will pay off by its original final
maturity date, (b) increase Borrower's payments to cover accruing interest, (c)
increase the number of Borrower's payments, and (d) continue Borrower's payments
at the same amount and increase Borrower's final payment.
PREPAYMENT. Borrower agrees that all loan fees and other prepaid finance charges
are earned fully as of the date of the loan and will not be subject to refund
upon early payment (whether voluntary or as a result of default), except as
otherwise required by law. Except for the foregoing, Borrower may pay without
penalty all or a portion of the amount owed earlier than it is due. Early
payments will not, unless agreed to by Lender in writing, relieve Borrower of
Borrower's obligation to continue to make payments under the payment schedule.
Rather, they will reduce the principal balance due and may result in Borrower
making fewer payments.
LATE PAYMENTS. It any payment is not received by Lender within five calendar
days after the payment is due as provided in this Note (the "Due Date'), then
additional interest will accrue beginning on the sixth calendar day on the
entire unpaid principal balance at the rate of three percent (3%) per year (the
"Additional Interest') until all past-due payments and any Additional Interest
are paid in full.
05-01-1998 PROMISSORY NOTE
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Loan No 9006 (Continued)
DEFAULT. Borrower will be in default if any of the following happens: (a)
Borrower fails to make any payment when due. (b) Borrower breaks any promise
Borrower has made to Lender, or Borrower fails to comply with or to perform when
due any other term, obligation, covenant, or condition contained in the Note or
any agreement related to this Note, or in any other agreement or loan Borrower
has with Lender. (c) Borrower defaults under any loan, extension of credit,
security agreement, purchase or sales agreement, or any other agreement, in
favor of any other creditor or person that may materially affect any of
Borrower's property or Borrower's ability to repay this Note or perform
Borrower's obligations under this Note or any of the Related Documents. (d) Any
representation or statement made or furnished to Lender by Borrower or on
Borrower's behalf is false or misleading in any material respect either now or
at the time made or furnished. (e) Borrower becomes insolvent, a receiver is
appointed for any part of Borrower's property, Borrower makes an assignment for
the benefit of creditors, or any proceeding is commenced either by Borrower or
against Borrower under any bankruptcy or insolvency laws. (f) Any creditor tries
to take any of Borrower's property on or in which Lender has a lien or security
interest. This includes a garnishment of any of Borrower's accounts with Lender.
(g) any guarantor dies or any of the other events described in this default
section occurs with respect to any guarantor or this Note. (h) A material
adverse change occurs in Borrower's financial condition.
LENDER'S RIGHTS. Upon default, and after Lender has notified borrower of said
Default and if such Default shall not be remedied within 15 days after such
notification then, Lender may declare the entire unpaid principal balance on
this Note and all accrued unpaid interest immediately due, without notice, and
then Borrower will pay that amount. Upon default, Including failure to pay upon
final maturity, Lender, at its option, may also, if permitted under applicable
law, increase the variable Interest rate on this Note to 5.000 percentage points
over the Index. The interest rate will not exceed the maximum rate permitted by
applicable law. Lender may hire or pay someone else to help collect this Note if
Borrower does not pay. Borrower also will pay Lender that amount. This includes,
subject to any limits under applicable law, Lender's attorneys' fees and
Lender's legal expenses whether or not there is a lawsuit, including attorneys'
fees and legal expenses for bankruptcy proceedings (including efforts to modify
or vacate any automatic stay or injunction), appeals, and any anticipated
post-judgment collection services. If not prohibited by applicable law, Borrower
also will pay any court costs, in addition to all other sums provided by law.
This Note has been delivered to Lender and accepted by Lender in the State of
New Mexico. If there is a lawsuit, Borrower agrees upon Lender's request to
submit to the jurisdiction of the courts of Bernalillo County, the State of New
Mexico. This Note shall be governed by and construed in accordance with the laws
of the State of New Mexico.
RIGHT OF SETOFF. Borrower grants to Lender a contractual possessory security
interest in, and hereby assigns, conveys, delivers, pledges, and transfers to
Lender all Borrower's right, title and interest in and to, Borrower's accounts
with Lender (whether checking, savings, or some other account), including
without limitation all accounts held jointly with someone else and all accounts
Borrower may open in the future, excluding however all IRA, Keogh, and trust
accounts for which the grant of a security interest would be prohibited by law.
Borrower authorizes Lender, to the extent permitted by applicable law, to charge
or setoff all sums owing on this Note against any and all such accounts.
FINANCIAL STATEMENTS. Borrower agrees to provide to Lender, upon request, any
financial statements or information Lender may deem necessary. Borrower warrants
that all financial statements and information Borrower provide to Lender are or
will be accurate, correct and complete.
ARBITRATION. Lender and Borrower agree that, except for "Core Proceedings' under
the United States Bankruptcy Code, all disputes, claims and controversies
between them, whether individual, joint, or class In nature, arising from this
Note or otherwise, including, without limitation, contract and tort disputes,
shall be arbitrated pursuant to the Commercial Arbitration rules of the American
Arbitration Association (the "AAA'), upon request of either party. No act to
take or dispose of any collateral securing this Note shall constitute a waiver
of this arbitration agreement or be prohibited by this arbitration agreement.
This includes, without limitation, obtaining injunctive relief or a temporary
restraining order; invoking a power of sale under any deed of trust or mortgage;
obtaining a writ of attachment or imposition of a receiver; or exercising any
rights relating to personal property, including taking or disposing of such
property with or without judicial process pursuant to Article 9 of the uniform
Commercial Code.
Any disputes, claims or controversies concerning the lawfulness or
reasonableness of any act, or exercise of any right, concerning any collateral
securing this Note, Including any claim to rescind, reform or otherwise modify
05-01-1998 PROMISSORY NOTE
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Loan No 9006 (Continued)
any agreement relating to the collateral securing this Note. shall also be
arbitrated, provided however that no arbitrator shall have the right or the
power to enjoin or restrain any act of any party. Judgment upon any award
rendered by any arbitrator may be entered in any court having jurisdiction.
Nothing in this Note shall preclude any party from seeking equitable relief from
a court of competent jurisdiction. The statute of limitations, estoppel, waiver,
laches and similar doctrines which would otherwise be applicable in an action
brought by a party shall be applicable in any arbitration proceeding, and the
commencement of an arbitration proceeding shall be deemed the commencement of an
action for these purposes. The Federal Arbitration Act shall apply to the
construction, interpretation and enforcement of this arbitration provision.
Any arbitration hereunder shall be conducted before one arbitrator who shall be
an attorney who has practiced in the area of commercial law for at least ten
(10) years or a retired judge at the District Court or an appellate court level.
The parties to the dispute or their representatives shall obtain from AAA a list
of persons meeting the criteria outlined above and the parties shall select the
person in the manner established by the AAA.
In any arbitration hereunder: (1) the arbitrator shall decide (by documents only
or with a hearing, at the arbitrator's discretion) any pre-hearing motions which
are substantially similar to pre-hearing motions to dismiss for failure to state
a claim or motions for summary adjudication; (2) discovery shall be permitted,
but shall be limited as provided in the New Mexico Rules of Civil Procedure,
with all discovery to be completed no later than 20 days before the hearing date
and within 180 days of the commencement of arbitration proceedings; and any
requests for an extension of the discovery periods, or any discovery disputes
shall be subject to final determination by the arbitrator; and (3) the
arbitrator shall award costs and expenses of the arbitration proceeding in
accordance with the Lender's Rights provisions of this Note.
BUSINESS LOAN AGREEMENT. This Note is subject to that certain Business Loan
Agreement dated 05-01-98 and any renewals, replacements, extensions or
amendments thereof.
GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights or
remedies under this Note without losing them. Borrower and any other person who
signs, guarantees or endorses this Note, to the extent allowed by law, waive
presentment, demand for payment, protest and notice of dishonor. Upon any change
in the terms of this Note, and unless otherwise expressly stated in writing, no
party who signs this Note, whether as maker, guarantor, accommodation maker or
endorser, shall be released from liability. All such parties agree that Lender
may renew or extend (repeatedly and for any length of time) this loan, or
release any party or guarantor or collateral; or impair, fail to realize upon or
perfect Lender's security interest in the collateral; and take any other action
deemed necessary by Lender without the consent of or notice to anyone. All such
parties also agree that Lender may modify this loan without the consent of or
notice to anyone other than the party with whom the modification is made.
PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF
THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISION. BORROWER AGREES TO
THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THE NOTE.
BORROWER:
BOWLIN OUTDOOR ADVERTISING & TRAVEL CENTERS, INCORPORATED
By: /s/ MICHAEL L. BOWLIN
----------------------------
Michael L. Bowlin, President