Exhibit 10.2

 

PROMISSORY NOTE

 

 

$15,000,000.00 October 7, 2016

 

 

FOR VALUE RECEIVED, the undersigned EnviroStar, Inc., a Delaware corporation
("Borrower") promises to pay to the order of WELLS FARGO BANK, NATIONAL
ASSOCIATION ("Bank") at its office at 200 South Biscayne Boulevard, Annex
Building, Miami, Florida 33131, Attention: Matthew Rapoport, or at such other
place as the holder hereof may designate, in lawful money of the United States
of America and in immediately available funds, the principal sum of FIFTEEN
MILLION DOLLARS ($15,000,000.00) or so much thereof as may be advanced and be
outstanding pursuant to the terms of the Credit Agreement, as defined herein,
with interest thereon, to be computed on each advance from the date of its
disbursement as set forth herein.

 

DEFINITIONS:

 

As used herein, the following terms shall have the meanings set forth after
each, and any other term defined in this Note shall have the meaning set forth
at the place defined:

 

(a)       "Daily One Month LIBOR" means, for any day, the rate of interest equal
to LIBOR then in effect for delivery for a one (1) month period.

 

(b)       "LIBOR" means the rate of interest per annum determined by Bank based
on the rate for United States dollar deposits for delivery of funds for one (1)
month as published by the ICE Benchmark Administration Limited, a United Kingdom
company, at approximately 11:00 a.m., London time, or, for any day not a London
Business Day, the immediately preceding London Business Day (or if not so
published, then as determined by Bank from another recognized source or
interbank quotation); provided, however, that if LIBOR determined as provided
above would be less than zero percent (0.0%), then LIBOR shall be deemed to be
zero percent (0.0%).

 

(c)       "London Business Day" means any day that is a day for trading by and
between banks in dollar deposits in the London interbank market.

 

INTEREST:

 

(a)       Interest . The outstanding principal balance of this Note shall bear
interest (computed on the basis of a 360-day year, actual days elapsed) at a
fluctuating rate per annum determined by Bank to be two and twenty-five
hundredths of one percent (2.25%) above Daily One Month LIBOR in effect from
time to time. Bank is hereby authorized to note the date and interest rate
applicable to this Note and any payments made thereon on Bank's books and
records (either manually or by electronic entry) and/or on any schedule attached
to this Note, which notations shall be prima facie evidence of the accuracy of
the information noted.

 

(b)       Taxes and Regulatory Costs. Borrower shall pay to Bank immediately
upon demand, in addition to any other amounts due or to become due hereunder,
any and all (i) withholdings, interest equalization taxes, stamp taxes or other
taxes (except income and franchise taxes) imposed by any domestic or foreign
governmental authority and related in any manner to LIBOR, and (ii) costs,
expenses and liabilities arising from or in connection with

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reserve percentages prescribed by the Board of Governors of the Federal Reserve
System (or any successor) for "Eurocurrency Liabilities" (as defined in
Regulation D of the Federal Reserve Board, as amended), assessment rates imposed
by the Federal Deposit Insurance Corporation, or similar requirements or costs
imposed by any domestic or foreign governmental authority or resulting from
compliance by Bank with any request or directive (whether or not having the
force of law) from any central bank or other governmental authority and related
in any manner to LIBOR. In determining which of the foregoing are attributable
to any LIBOR option available to Borrower hereunder, any reasonable allocation
made by Bank among its operations shall be conclusive and binding upon Borrower.

 

(c)       Default Interest. From and after the maturity date of this Note, or
such earlier date as all principal owing hereunder becomes due and payable by
acceleration or otherwise, or upon the occurrence and during the continuance of
an Event of Default, then at the option of Bank, in its sole and absolute
discretion, the outstanding principal balance of this Note shall bear interest
at an increased rate per annum (computed on the basis of a 360-day year, actual
days elapsed) equal to four percent (4%) above the rate of interest from time to
time applicable to this Note.

 

BORROWING AND REPAYMENT:

 

(a)       Borrowing and Repayment of Principal. Borrower may from time to time
during the term of this Note borrow, partially or wholly repay its outstanding
borrowings, and reborrow, subject to all of the limitations, terms and
conditions of this Note, that certain Credit Agreement dated of even date
herewith between Borrower and Bank (as the same may be amended or modified from
time to time, the “Credit Agreement”), and of any document executed in
connection with or governing this Note; provided however, that the total
outstanding borrowings under this Note shall not at any time exceed the
principal amount stated above. The unpaid principal balance of this obligation
at any time shall be the total amounts advanced hereunder by the holder hereof
less the amount of principal payments made hereon by or for Borrower, which
balance may be endorsed hereon from time to time by the holder. The outstanding
principal balance of this Note shall be due and payable in full on October 7,
2021 (the “Maturity Date”).

 

(b)       Payment of Interest. Interest accrued on this Note shall be payable on
the 7th day of each month, commencing on November 7, 2016.

 

(c)       Advances. Advances hereunder, to the total amount of the principal sum
stated above, may be made by the holder at the oral or written request of any
individual so authorized in the Borrower’s resolutions delivered in connection
with the execution of the Credit Agreement.

 

(d)       Application of Payments. Each payment made on this Note shall be
credited first, to any interest then due and second, to the outstanding
principal balance hereof.

 

 

PREPAYMENT:

 

Borrower may prepay principal on this Note at any time, in any amount and
without penalty. If principal under this Note is payable in more than one
installment, then any prepayments of principal shall be applied to the most
remote principal installment or installments then unpaid.

 

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EVENTS OF DEFAULT:

 

This Note is made pursuant to and is subject to the terms and conditions of the
Credit Agreement. Any default in the payment or performance of any obligation
under this Note, or any defined event of default under the Credit Agreement,
shall constitute an "Event of Default" under this Note.

 

MISCELLANEOUS:

 

(a)       Remedies. Upon the sale, transfer, hypothecation, assignment or other
encumbrance, whether voluntary, involuntary or by operation of law, of all or
any interest in any real property securing this Note, if any, or upon the
occurrence of any Event of Default, the holder of this Note, at the holder's
option, may declare all sums of principal and interest outstanding hereunder to
be immediately due and payable without presentment, demand, notice of
nonperformance, notice of protest, protest or notice of dishonor, all of which
are expressly waived by Borrower, and the obligation, if any, of the holder to
extend any further credit hereunder shall immediately cease and terminate.
Borrower shall pay to the holder immediately upon demand the full amount of all
payments, advances, charges, costs and expenses, including reasonable attorneys'
fees (to include outside counsel fees and all allocated costs of the holder's
in-house counsel), expended or incurred by the holder in connection with the
enforcement of the holder's rights and/or the collection of any amounts which
become due to the holder under this Note whether or not suit is brought, and the
prosecution or defense of any action in any way related to this Note, including
without limitation, any action for declaratory relief, whether incurred at the
trial or appellate level, in an arbitration proceeding or otherwise, and
including any of the foregoing incurred in connection with any bankruptcy
proceeding (including without limitation, any adversary proceeding, contested
matter or motion brought by Bank or any other person) relating to Borrower or
any other person or entity.

 

(b)       Obligations Joint and Several. Should more than one person or entity
sign this Note as a Borrower, the obligations of each such Borrower shall be
joint and several.

 

(c)       Governing Law. This Note shall be governed by and construed in
accordance with the laws of the State of New York, but giving effect to federal
laws applicable to national banks, without reference to the conflicts of law or
choice of law principles thereof.

 

(d)       Savings Clause. If at any time the interest rate set forth in this
Note exceeds the maximum interest rate allowable under applicable law, the
interest rate shall be deemed to be such maximum interest rate allowable under
applicable law.

 

(e)       Right Of Setoff; Deposit Accounts. Upon and after the occurrence of an
Event of Default, (a) Borrower hereby authorizes Bank, at any time and from time
to time, without notice, which is hereby expressly waived by Borrower, and
whether or not Bank shall have declared this Note to be due and payable in
accordance with the terms hereof, to set off against, and to appropriate and
apply to the payment of, Borrower's obligations and liabilities under this Note
(whether matured or unmatured, fixed or contingent, liquidated or unliquidated),
any and all amounts owing by Bank to Borrower (whether payable in U.S. dollars
or any other currency, whether matured or unmatured, and in the case of
deposits, whether general or special (except trust and escrow accounts), time or
demand and however evidenced), and (b) pending any such action, to the extent
necessary, to hold such amounts as collateral to secure such obligations and
liabilities and to return as unpaid for insufficient funds any and all checks
and other items

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drawn against any deposits so held as Bank, in its sole discretion, may elect.
Borrower hereby grants to Bank a security interest in all deposits and accounts
maintained with Bank to secure the payment of all obligations and liabilities of
Borrower to Bank under this Note.

 

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IN WITNESS WHEREOF, the undersigned has executed this Note as of the date first
written above.

 

 

EnviroStar, Inc., a Delaware corporation

 

 

By:/s/ Henry M. Nahmad                            

Name: Henry M. Nahmad                            

Title: President                                              

 

 

STATE OF ____________ ) COUNTY OF __________ )

 

The foregoing instrument was acknowledged before me this ___ day of October,
2016, by ____________________, as ________________ of EnviroStar, Inc., a
Delaware corporation, on behalf of the corporation. He is personally known to me
or produced _______________ as identification.

 

 

      Print or Stamp Name:     Notary Public: State of     Commission Number:  
  My Commission Expires:  

 

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