Exhibit
10.1
NOTE
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SBA
Loan #
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49453874-03
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SBA
Loan Name
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Track
Group, Inc.
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Date
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May 12,
2020
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Loan
Amount
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$933,200.00
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Interest
Rate
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1.00%
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Borrower
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Track
Group, Inc.
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Operating
Company
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N/A
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Lender
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BMO
Harris Bank National Association
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1.
PROMISE TO
PAY:
In
return for the Loan, Borrower promises to pay to the order of
Lender the amount of $933,200.00, interest on the unpaid principal
balance, and all other amounts required by this Note.
2.
DEFINITIONS:
“Collateral”
means any property taken as security for payment of this Note or
any guarantee of this Note.
“Guarantor”
means each person or entity that signs a guarantee of payment of
this Note.
“Loan”
means the loan evidenced by this Note.
“Loan
Documents” means the documents related to this loan signed by
Borrower, any Guarantor, or anyone who pledges
collateral.
“SBA”
means the Small Business Administration, an Agency of the United
States of America.
1.
PAYMENT
TERMS:
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Borrower must make
all payments at the place Lender designates. The payment terms for
this Note are:
Maturity: This Note will mature in 2
years and 0 months from date of Note.
Repayment
terms:
The
interest rate is 1% per year. The interest rate may only be changed
in accordance with
SOP 50
10.
Borrower must pay
principal and interest payments of $52,517.20 every month,
beginning 7 months from the date of the Note; payments must be made
on the same day as the date of the Note in the months they are
due.
Lender
will apply each installment first to pay interest accrued to the
day Lender receives the payment, then to bring principal current,
then to pay any late fees, and will apply any remaining balance to
reduce principal.
Loan
Prepayment:
Notwithstanding any
provision in this Note to the contrary:
Borrower may prepay this Note. Borrower
may prepay 20 percent or less of the unpaid principal balance at
any time without notice. If Borrower prepays more than 20 percent
and the Loan has been sold on the secondary market, Borrower
must:
a.
Give Lender written
notice;
b.
Pay all accrued
interest; and
c.
If this prepayment
is received less than 21 days from the date Lender receives the
notice, pay an amount equal to 21 days' interest from the date
lender receives the notice, less any interest accrued during the 21
days and paid under subparagraph b., above.
If
Borrower does not prepay within 30 days from the date Lender
receives the notice, Borrower must give Lender a new
notice.
All
remaining principal and accrued interest is due and payable 2 years
and 0 months from
date of
Note.
Late Charge: If payment on this Note is
more than 10 days late, Lender may charge Borrower a late fee of up
to 5.00 % of the unpaid portion of the regularly scheduled
payment.
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1.
DEFAULT:
Borrower is in
default under this Note if Borrower does not make a payment when
due under this Note, or if Borrower or Operating
Company:
A.
Fails to do
anything required by this Note and other Loan
Documents;
B.
Defaults on any
other loan with Lender;
C.
Does not preserve,
or account to Lender’s satisfaction for, any of the
Collateral or its proceeds;
D.
Does not disclose,
or anyone acting on their behalf does not disclose, any material
fact to Lender or SBA;
E.
Makes, or anyone
acting on their behalf makes, a materially false or misleading
representation to Lender or SBA;
F.
Defaults on any
loan or agreement with another creditor, if Lender believes the
default may materially affect Borrower’s ability to pay this
Note;
G.
Fails to pay any
taxes when due;
H.
Becomes the subject
of a proceeding under any bankruptcy or insolvency
law;
I.
Has a receiver or
liquidator appointed for any part of their business or
property;
J.
Makes an assignment
for the benefit of creditors;
K.
Has any adverse
change in financial condition or business operation that Lender
believes may materially affect Borrower’s ability to pay this
Note;
L.
Reorganizes,
merges, consolidates, or otherwise changes ownership or business
structure without
Lender’s
prior written consent; or
M.
Becomes the subject
of a civil or criminal action that Lender believes may materially
affect
Borrower’s
ability to pay this Note.
2.
LENDER’S
RIGHTS IF THERE IS A DEFAULT:
Without
notice or demand and without giving up any of its rights, Lender
may:
A.
Require immediate
payment of all amounts owing under this Note;
B.
Collect all amounts
owing from any Borrower or Guarantor;
C.
File suit and
obtain judgment;
D.
Take possession of
any Collateral; or
E.
Sell, lease, or
otherwise dispose of, any Collateral at public or private sale,
with or without advertisement.
3.
LENDER’S
GENERAL POWERS:
Without
notice and without Borrower’s consent, Lender
may:
A.
Bid on or buy the
Collateral at its sale or the sale of another lienholder, at any
price it chooses;
B.
Incur expenses to
collect amounts due under this Note, enforce the terms of this Note
or any other Loan Document, and preserve or dispose of the
Collateral. Among other things, the expenses may include payments
for property taxes, prior liens, insurance, appraisals,
environmental remediation costs, and reasonable attorney’s
fees and costs. If Lender incurs such expenses, it may demand
immediate repayment from Borrower or add the expenses to the
principal balance;
C.
Release anyone
obligated to pay this Note;
D.
Compromise,
release, renew, extend or substitute any of the Collateral;
and
E.
Take any action
necessary to protect the Collateral or collect amounts owing on
this Note.
4.
WHEN FEDERAL LAW
APPLIES:
When
SBA is the holder, this Note will be interpreted and enforced under
federal law, including SBA regulations. Lender or SBA may use state
or local procedures for filing papers, recording documents, giving
notice, foreclosing liens, and other purposes. By using such
procedures, SBA does not waive any federal immunity from state or
local control, penalty, tax, or liability. As to this Note,
Borrower may not claim or assert against SBA any local or state law
to deny any obligation, defeat any claim of SBA, or preempt federal
law.
5.
SUCCESSORS AND
ASSIGNS:
Under
this Note, Borrower and Operating Company include the successors of
each, and Lender includes its successors and assigns.
6.
GENERAL
PROVISIONS:
A.
All individuals and
entities signing this Note are jointly and severally
liable.
B.
Borrower waives all
surety ship defenses.
C.
Borrower must sign
all documents necessary at any time to comply with the Loan
Documents and to enable Lender to acquire, perfect, or maintain
Lender’s liens on Collateral.
D.
Lender may exercise
any of its rights separately or together, as many times and in any
order it chooses. Lender may delay or forgo enforcing any of its
rights without giving up any of them.
E.
Borrower may not
use an oral statement of Lender or SBA to contradict or alter the
written terms of this Note.
F.
If any part of this
Note is unenforceable, all other parts remain in
effect.
G.
To the extent
allowed by law, Borrower waives all demands and notices in
connection with this Note, including presentment, demand, protest,
and notice of dishonor. Borrower also waives any defenses based
upon any claim that Lender did not obtain any guarantee; did not
obtain, perfect, or maintain a lien upon Collateral; impaired
Collateral; or did not obtain the fair market value of Collateral
at a sale.
1.
STATE-SPECIFIC
PROVISIONS:
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The
following provision applies when a borrower is a resident of
WISCONSIN:
Each
Borrower who is married represents that this obligation is incurred
in the interest of his or her marriage or family.
The
following Confession of Judgment provision applies when a borrower
is a resident of DELAWARE:
WARRANT
OF ATTORNEY/CONFESSION OF JUDGMENT. In addition to any other
remedies Lender may possess, Borrower knowingly, voluntarily and
intentionally authorizes any attorney to appear on behalf of
Borrower, from time to time, in any court of record possessing
jurisdiction over this Note and to waive issuance and service of
process and to confess judgment in favor of Lender against
Borrower, for the unpaid principal, accrued interest, accrued
charges, reasonable attorney fees and court costs and such other
amount due under this Note.
The
following Confession of Judgment provision applies when a borrower
is a resident of MARYLAND: WARRANT
OF ATTORNEY/CONFESSION OF JUDGMENT. Borrower authorizes an attorney
to appear in a court of record and confess judgment, without
process, against Borrower in favor of Lender for all indebtedness
owed in connection with the loan, including but not limited to
service charges, other charges and reasonable attorney's
fees.
The
following Confession of Judgment provision applies when a borrower
is a resident of OHIO:
WARRANT
OF ATTORNEY/CONFESSION OF JUDGMENT. In addition to any other
remedies Lender may possess, Borrower knowingly, voluntarily and
intentionally authorizes any attorney to appear on behalf of
Borrower, from time to time, in any court of record possessing
jurisdiction over this Note and to waive issuance and service of
process and to confess judgment in favor of Lender against
Borrower, for the unpaid principal, accrued interest, accrued
charges, reasonable attorney fees and court costs and such other
amount due under this Note. WARNING: BY SIGNING THIS PAPER YOU GIVE
UP YOUR RIGHT TO NOTICE AND COURT TRIAL. IF YOU DO NOT PAY ON TIME,
A COURT JUDGMENT MAY BE TAKEN AGAINST YOU WITHOUT YOUR PRIOR
KNOWLEDGE AND THE POWERS OF THE COURT CAN BE USED TO COLLECT FROM
YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR
WHETHER FOR RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO
COMPLY WITH THE AGREEMENT OR ANY OTHER CAUSE.
The
following Confession of Judgment provision applies when a borrower
is a resident of PENNSYLVANIA: WARRANT OF ATTORNEY/CONFESSION OF JUDGMENT.
Borrower irrevocably authorizes and empowers the prothonotary, any
attorney or any clerk of any court of record, upon default, to
appear for and confess judgment against Borrower for such sums as
are due and/or may become due under this Note including costs of
suit, without stay of execution, and for attorney's fees and costs
as set forth in this Note and knowingly, voluntarily and
intentionally waives any and all rights Borrower may have to notice
and hearing under the state and federal laws prior to entry of a
judgment. To the extent permitted by law, Borrower releases all
errors in such proceedings. If a copy of this Note, verified by or
on behalf of the holder shall have been filed in such action, it
shall not be necessary to file the original Note as a warrant of
attorney. The authority and power to appear for and confess
judgment against Borrower shall not be exhausted by the initial
exercise thereof and may be exercised as often as the holder shall
find it necessary and desirable and this Note shall be a sufficient
warrant for such authority and power.
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The following Confession of Judgment provision
applies when a borrower is a resident of VIRGINIA:
IMPORTANT NOTICE: THIS INSTRUMENT
CONTAINS A CONFESSION OF JUDGMENT PROVISION WHICH CONSTITUTES A
WAIVER OF IMPORTANT RIGHTS YOU MAY HAVE AS A DEBTOR AND ALLOWS THE
CREDITOR TO OBTAIN A JUDGMENT AGAINST YOU WITHOUT ANY FURTHER
NOTICE. WARRANT OF ATTORNEY/CONFESSION OF JUDGMENT. In addition
to
any other
remedies Lender may possess, Borrower knowingly, voluntarily and
intentionally authorizes to appear on behalf of Borrower, from time
to time, in the District Court of Alexandria, Virginia and to waive
issuance and service of process and to confess judgment in favor of
Lender against Borrower, for the unpaid principal, accrued
interest, accrued charges, reasonable attorney fees and court costs
and such other amount due under this Note. The following Oral
Agreements Disclaimer provision applies when the borrower is a
resident of MISSOURI: Oral or unexecuted
agreements or commitments to loan money, extend credit or to
forbear from enforcing repayment of a debt including promises to
extend or renew such debt are not enforceable, regardless of the
legal theory upon which it is based that is in any way related to
the credit agreement. To protect you (Borrowers(s)) and us
(Creditor) from misunderstanding or disappointment, any agreements
we reach covering such matters are contained in this writing, which
is the complete and exclusive statement of the agreement between
us, except as we may later agree in writing to modify
it.
The following Oral
Agreements Disclaimer provision applies when the borrower is a
resident of MISSOURI: Oral or unexecuted
agreements or commitments to loan money, extend credit or to
forbear from enforcing repayment of a debt including promises to
extend or renew such debt are not enforceable, regardless of the
legal theory upon which it is based that is in any way related to
the credit agreement. To protect you (Borrowers(s)) and us
(Creditor) from misunderstanding or disappointment, any agreements
we reach covering such matters are contained in this writing, which
is the complete and exclusive statement of the agreement between
us, except as we may later agree in writing to modify
it.
The following Oral Agreements Disclaimer
provision applies when the borrower is a resident of OREGON:
UNDER OREGON LAW, MOST AGREEMENTS,
PROMISES AND COMMITMENTS MADE BY [BENEFICIARY]/ US CONCERNING LOANS
AND OTHER CREDIT EXTENSIONS WHICH ARE NOT FOR PERSONAL, FAMILY, OR
HOUSEHOLD PURPOSES OR SECURED SOLELY BY GRANTOR'S/BORROWER'S
RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION AND BE SIGNED
BY [AN AUTHORIZED REPRESENTATIVE OF BENEFICIARY]/US TO BE
ENFORCEABLE.
The
following Oral Agreements Disclaimer provision applies when the
borrower is a resident of WASHINGTON:
Oral
agreements or oral commitments to loan money, extend credit, or to
forbear from enforcing repayment of a debt are not enforceable
under Washington law.
The
following provision applies when the borrower is a resident of
ALASKA:
The
Mortgagor or Trustor (Borrower) is personally obligated and fully
liable for the amount due under the Note. The Mortgagee or
Beneficiary (Lender) has the right to sue on the Note and obtain a
personal judgment against the Mortgagor or Trustor for the
satisfaction of the amount due under the Note either before or
after a judicial foreclosure of the Mortgage or Deed of Trust as
under AS 09.45.170-09.45.220.
The following Oral Agreements Disclaimer
provision applies when the borrower is a resident of IOWA:
IMPORTANT: READ BEFORE SIGNING. The
terms of this agreement should be read carefully because only those
terms in writing are enforceable. No other terms or oral promises
not contained in this written contract may be legally enforced. You
may change the terms of this agreement only by another written
agreement.
The following Oral Agreements Disclaimer
provision applies when the borrower is a resident of UTAH:
This is a final expression of the
agreement between the creditor and debtor and the written agreement
may not be contradicted by evidence of any alleged oral
agreement.
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1.
BORROWER’S
NAME(S) AND SIGNATURE(S):
By
signing below, each individual or entity becomes obligated under
this Note as Borrower.
