Exhibit 10.123

 

PROMISSORY NOTE

 

$700,000.00              

 

February 10, 2009

 

1.                                      MAKER’S PROMISE TO PAY

 

FOR VALUE RECEIVED, MEADE INSTRUMENTS CORP., a Delaware corporation (“Maker”),
promises to pay to the order of THE IRVINE COMPANY LLC, a Delaware limited
liability company (“Payee”), at the address set forth in Section 3 hereof, the
principal sum of Seven Hundred Thousand Dollars ($700,000.00), together with
accrued interest on the unpaid principal balance at the applicable rate as set
forth in Section 2 hereof.  Maker acknowledges and agrees that Payee may assign
or otherwise transfer this Note at any time.  Payee or anyone who takes this
Note by any such transfer and who is entitled to receive payments under this
Note is sometimes hereinafter referred to as the “Note Holder.”

 

2.                                      INTEREST

 

No interest shall accrue on the principal balance of this Note. Notwithstanding
the foregoing, upon the occurrence of an Event of Default as described in
Section 6(a) below, and for so long as such default continues, the sum(s) of
principal then due and payable hereunder, whether by acceleration or otherwise,
shall bear interest at the per annum rate of ten percent (10%) (the “Default
Rate”).

 

3.                                      PAYMENTS

 

NOTICE TO MAKER:  THE PAYMENT OF PRINCIPAL AND INTEREST AND ANY OTHER SUMS THEN
DUE HEREUNDER IS A BALLOON PAYMENT.  MAKER HAS NO RIGHT WHATSOEVER TO EXTEND OR
RENEW THIS NOTE WHEN THE BALLOON PAYMENT BECOMES DUE ON THE MATURITY DATE.  NOTE
HOLDER IS UNDER NO OBLIGATION TO REFINANCE THE LOAN AT THAT TIME.

 

Maker shall make payments of principal under this Note in accordance with the
following schedule:

 

(a)                                  Two Hundred Thousand Dollars ($200,000.00)
on May 1, 2009;

 

(b)                                 Two Hundred Thousand Dollars ($200,000.00)
on August 1, 2009; and

 

(c)                                  Three Hundred Thousand Dollars
($300,000.00) on November 1, 2009 (the “Maturity Date”).

 

On the Maturity Date, the entire unpaid principal balance hereof, together with
accrued but unpaid interest thereon and any other sums then due hereunder, shall
immediately become due and payable in full.

 

Any payments received by Note Holder pursuant to the terms hereof shall be
applied first to the payment of any sums, other than principal and interest, due
Note Holder pursuant to the terms hereof, next to the payment of all interest
accrued to the date of such payment, and then to the payment of principal.  All
payments hereunder are payable in lawful money of the United States of America
and shall be wired to the following account of Note Holder, or shall be payable
at such other place as the Note Holder hereof may designate from time to time:

 

Wells Fargo Bank
San Francisco, CA
Account No: 4944677699
Account Name: TIC - Tech Portfolio
Routing No: 121000248
[Amount of Wired Amount or ACH]
Mead Instruments Corp. - 663841-S29453

 

4.                                      MAKER’S RIGHT TO PREPAY

 

Maker shall have the right to prepay all or part of the unpaid principal balance
hereof, together with accrued but unpaid interest thereon, at any time without
penalty.

 

5.                                      INTEREST RATE LIMITATION

 

If it is determined that the transaction contemplated hereby is subject to the
usury laws of the State of California, Note Holder and Maker stipulate and agree
that none of the terms and provisions

 

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contained herein or in any document or instrument executed in connection
herewith shall ever be construed to create a contract for the use, forbearance
or detention of money requiring payment of interest at a rate in excess of the
maximum interest rate permitted to be charged by the laws of the State of
California.  If any Note Holder shall collect monies which are deemed to
constitute interest which would otherwise increase the effective interest rate
on this Note to a rate in excess of the maximum rate permitted to be charged by
the laws of the State of California, all such sums deemed to constitute interest
in excess of such maximum rate shall, at the option of Note Holder, be credited
to the payment of the sums due hereunder or returned to Maker.

 

6.                                      DEFAULT

 

The occurrence of any of the following shall be deemed to be an “Event of
Default” under this Note:

 

(a)           the failure of Maker to pay principal, interest and any other sums
when due pursuant to the terms hereof; or

 

(b)           the failure of Maker to fully comply with any other covenant or
obligation under this Note.

 

7.                                      REMEDIES

 

Upon the occurrence of an Event of Default hereunder, Note Holder may, in its
sole and absolute discretion and without demand or notice to Maker, (a) declare
the entire unpaid balance hereof, together with accrued but unpaid interest
thereon and any other sums then due hereunder, immediately due and payable, and
(b) exercise any and all rights and powers and pursue any and all remedies now
or hereafter available under applicable law.  No delay or omission on the part
of Note Holder in exercising any right or remedy under this Note shall operate
as a waiver of such right or remedy.

 

8.                                      LATE CHARGE

 

If any payment due hereunder is not received by the Note Holder within ten
(10) calendar days after the date such payment is due, Maker shall pay to Note
Holder, without demand, a late charge in an amount equal to four percent (4%) of
the amount past due.  It would be impracticable or extremely difficult to fix
the Note Holder’s actual damages if payment is not paid when due hereunder, and
said late charge shall be deemed to be the Note Holder’s damage for any such
late payment, but shall not limit the Note Holder’s right to compel prompt
performance of any obligation or to exercise any other remedy under this Note. 
No late charge assessed shall exceed the maximum permitted by law.

 

9.                                      NOTICES

 

Any notice, request, demand, instruction or other communication to be given to
any party hereunder shall be in writing and shall be deemed to have been duly
given three (3) business days after deposit in the United States mail or, if
personally delivered or sent by registered or certified mail, return receipt
requested, when delivered, as follows:

 

If to Maker:                                  MEADE INSTRUMENTS CORP.
27 Hubble
Irvine, CA  92618
Attention:

 

If to Payee:                                    THE IRVINE COMPANY LLC
550 Newport Center Drive
Newport Beach, CA  92660
Attn:  Vice President Operations, Irvine Office Properties - Technology
Portfolio

 

The addressees and addresses for the purpose of this paragraph may be changed by
giving written notice of such change in the manner herein provided for giving
notice.  However, unless and until such written notice of change is actually
received, the last address and addresses as stated by written notice, or
provided herein if no written notice of change has been received, shall be
deemed to continue in effect for all purposes hereunder.

 

10.                               WAIVERS

 

Maker hereby waives diligence, presentment, protest and demand, notice of
protest, demand, dishonor and nonpayment of this Note, and notice of intention
to accelerate the maturity of this Note and expressly agrees that, without in
any way affecting the liability of Maker hereunder, Note Holder may extend any
maturity date or the time for payment of any installment due hereunder, accept
additional security, release any party liable hereunder and release any security
now or hereafter securing this Note.  Maker further waives, to the full extent
permitted by law, the right to plead any and all statutes of limitations as a
defense to any demand on this Note, or on any deed of trust, security agreement,
lease assignment, guaranty or other instrument now or hereafter securing this
Note.  Maker hereby waives all rights of setoff and counterclaim with respect to
this Note, including rights of setoff and counterclaim with respect to this Note
which may arise from claims heretofore unknown to Maker.

 

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11.                               ATTORNEYS’ FEES

 

If the Note Holder seeks legal advice following a default by Maker hereunder or
refers this Note to collection or to reclaim, protect, preserve or enforce its
interest in this Note or under any instrument securing this Note, then Maker
shall pay all attorneys’ fees and expenses and other costs relating thereto.

 

12.                               THIS NOTE IS SECURED BY A LETTER OF CREDIT. 
This Note is secured by a Letter of Credit in the amount of Seven Hundred
Thousand Dollars ($700,000.00) issued by Bank of America (the “Letter of
Credit”).

 

13.                               SEVERABILITY

 

Every provision of this Note is intended to be severable.  In the event any term
or provision hereof is declared by a court of competent jurisdiction to be
illegal or invalid for any reason whatsoever, such illegality or invalidity
shall not affect the balance of the terms and provisions hereof, which terms and
provisions shall remain binding and enforceable.

 

14.                               NUMBER AND GENDER

 

In this Note the singular shall include the plural and the masculine shall
include the feminine and neuter gender, and vice versa, if the context so
requires.

 

15.                               TIME IS OF THE ESSENCE

 

Time is strictly of the essence under this Note and any amendment, modification
or revision hereof.

 

16.                               CHOICE OF LAW

 

This Note shall be governed by and construed in accordance with the laws of the
State of California.

 

17.                               JOINT AND SEVERAL LIABILITY

 

If this Note should be signed by more than one party, the liability under this
Note of each party shall be joint and several.  In addition, if Maker is a
partnership, the liability under this Note of each general partner of Maker, and
the liability of each general partner of a partnership which is itself a general
partner of Maker, shall be joint and several.

 

MAKER:

 

MEADE INSTRUMENTS CORP.,

a Delaware corporation

 

By:

/s/Paul E. Ross

 

 

Paul E. Ross

 

 

Senior Vice President - Finance Chief Financial Officer

 

 

 

 

 

 

 

By:

/s/Steven G. Murdock

 

 

Steven G. Murdock

 

 

Chief Executive Officer

 

 

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