Promissory Note - Stock Market Institute of Learning Inc., Evergreen Lodging LP and Centrum Financial Services Inc.
PROMISSORY NOTE
$700,000 Seattle, Washington
May 30, 2001
FOR VALUE RECEIVED, the undersigned promise to pay to Centrum Financial
Services, Inc., a Washington corporation, or order, at P.O. Box 2243, Seattle,
Washington 98111-2243, or at such other address as the holder hereof may
hereafter direct in writing, the sum of SEVEN HUNDRED THOUSAND and no/100
DOLLARS ($700,000.00), In lawful money of the United States, with interest
thereon from the date hereof, at the rate hereinafter provided, payable as
follows:
An amount equal to all then unpaid accrued interest on or before the 1st
day of July, 2001, and a sum equal to all then unpaid accrued interest on
or before the same day of each succeeding calendar month thereafter until
such time as this note is paid in full, which payments are subject to
adjustment as hereinafter provided. The undersigned further agree to pay
interest from the date hereof, on the principal balance, and the
diminishing amounts thereof, at a rate equal to 6.00% per annum above the
prime lending rate established by Bank of America for commercial loans in
the Seattle area, which rate is presently set at 7.00% per annum. The
interest rate herein shall be adjusted on the date hereof, and thereafter
on the first day of each succeeding calendar month, to an amount equal to
6.00% per annum above the prime lending rate. Interest shall be deducted
from each monthly installment and the balance, if any, shall be applied in
reduction of principal. The monthly payments shall be adjusted, on the date
the interest rate is adjusted as provided above, to a sum equal to the
amount of interest which accrues monthly pursuant to this note. In any
event, the undersigned agree to pay this note in full on or before December
1, 2002.
If Bank of America ceases to establish a prime lending rate, or such rate
is otherwise unavailable, the holder hereof may choose a reasonably comparable
substitute in its sole discretion.
If any monthly installment or other payment under this note is not received
by the holder hereof within 5 calendar days after the installment or payment is
due, the undersigned agrees to pay the holder hereof a late charge of 5.00% of
such delinquent installment and/or payment.
The undersigned may prepay this note in whole, or in part, at any time
without penalty.
The undersigned hereby represents and warrants to the holder hereof as
follows:
(1) That Stock Market Institute of Learning, Inc., formerly known as Wade Cook
Services, Inc., is a corporation duly organized and existing pursuant to
the laws of the State of Nevada, has paid all fees last due said State, and
is in good standing therewith; and that Evergreen Lodging Limited
Partnership is a limited partnership duly organized and existing pursuant
to the laws of the State of Nevada, has paid all fees last due said State,
and is in good standing therewith; that Five Star Consulting, Inc is a
corporation duly organized and existing pursuant to the laws of the State
of Nevada, has paid all fees last due said State, and is in good standing
therewith, and is the sole general partner of Evergreen Lodging Limited
Partnership; and that the parties signing for the foregoing entities have
good and sufficient authority to bind such entities to the terms and
conditions of this note as well as any other documents executed in
connection with the loan that is the subject hereof;
(2) That the proceeds of this note will be used exclusively for commercial and
business purposes only;
PROMISSORY NOTE
Page 1 of 2
<PAGE>
(3) That this transaction has been negotiated and consummated in the State of
Washington;
(4) That all documents executed and delivered in connection with this
transaction have been executed and delivered in the State of Washington;
(5) That the laws of the State of Washington shall govern the validity and
construction of this note; and
(6) That the undersigned have received an opinion of independent counsel that
the loan represented by this note is not usurious under the laws of the
State of Washington.
The whole sum of both principal and interest of this note shall be due and
payable in full, without further notice, at the option of the holder hereof in
the event that any of the security for this note, or any part thereof, or any
interest therein, is directly or indirectly, voluntarily or involuntarily, sold,
transferred, exchanged, or pledged in any way and any of such events shall be a
default under the terms and conditions of this note.
In the event of a default in the payment of this note, or in the event of
any other default under the terms and conditions of this note as described
herein, the whole sum of both principal and interest shall become due and
payable at once without further notice at the option of the holder hereof, and
after any such default, this note shall bear interest at the rate which is
20.00% per annum higher than the interest rate otherwise charged in connection
with this Note, or 36.00% per annum, whichever is higher. If by reason of any
default it becomes necessary for the holder or this note to employ an attorney,
of if an action is instituted, the undersigned promises to pay the costs of
collection, including reasonable attorney's fees, and agrees, at the option of
the holder hereof, that the venue of any such action shall be laid in King
County, Washington, or, at the option of the holder hereof, in such county or
counties in which any security for this note may be located. Failure of the
holder hereof to accelerate payment of this note shall not constitute a waiver
of the exercise of this right if default is not cured or if the undersigned
again defaults.
Each and every party to this note, and all persons now or hereafter liable
for the payment or performance of any of the conditions hereof, shall be bound
jointly and severally, and hereby waive presentment, demand, protest and notice
of nonpayment of this note, and consent that the holder hereof may extend the
time of payment or otherwise modify the terms of payment of any part or whole of
the debt evidenced by this note at the request of any party liable herein, and
agree that such consent shall in no way alter or diminish any liability of any
party hereon.
This note is secured by a Deed of Trust of even date on property in Pierce
County, Washington, Assignments of Deeds of Trust in King and Pierce County,
Washington, and Ada County, Idaho, as well as a Security Agreement of even date.
STOCK MARKET INSTITUTE OF LEARNING, INC.,
formerly known as Wade Cook Seminars, Inc.
by: /s/Wade B. Cook
---------------------------------------
Wade B. Cook, President
EVERGREEN LODGING LIMITED PARTNERSHIP
by: Five Star Consulting, Inc.,
a Nevada corporation,
General Partner
by: /s/Wade B. Cook
---------------------------------------
Wade B. Cook, Presiden
PROMISSORY NOTE
Page 2of 2