ex10_4.htm


  
    Exhibit
10.4

     

    RESTATED
AND AMENDED

    PROMISSORY
NOTE

    OF

    FIVE
STAR GROUP, INC.

    PAYABLE
TO THE ORDER OF

    BANK
OF AMERICA, N.A.

    


    


    
      
        	
                Amount
      of Note: $35,000,000

              	
                Interest
      Rate:

              	
                Set
      forth below

              
	 
      	 
      	 
      
	 
      	
                Dated:

              	
                June
      26, 2008

              
	 
      	 
      	 
      
	 
      	
                Maturity
      Date:    

              	
                June 30, 2011, unless
      sooner accelerated or terminated as provided
  below

              


      

    

     

     

    1.           GENERAL PROMISE TO
PAY:   FIVE STAR GROUP, INC., a
corporation organized and existing under the laws of the State of Delaware with
its principal place of business at 903 Murray Road, East Hanover, Morris County,
New Jersey 07936 with its mailing address at 903 Murray Road, P.O. Box 357, East
Hanover, Morris County, New Jersey 07936 (being hereinafter referred to as
“BORROWER”) hereby
promises to pay to the order of
BANK OF AMERICA, N.A. (hereinafter called “LENDER”) the principal sum of
THIRTY-FIVE MILLION AND NO/100
DOLLARS ($35,000,000), or, if any lesser sum is outstanding hereunder,
the aggregate unpaid principal amount of all advances, re-advances, loans and
re-loans made by LENDER to BORROWER hereunder, such payment to be made in lawful
money of the United States, together with interest as hereinafter
provided.

     


    2.           NOTE AND RECORDS OF LENDER TO
EVIDENCE LOAN:

     

    (a)           This
Note is BORROWER’s “master” Revolving Note described in that certain Restated
and Amended Loan and Security Agreement by and between LENDER and BORROWER and
dated even date herewith, such certain Restated
and Amended Loan and Security Agreement and all extensions, modifications
(including without limitation modifications increasing or decreasing the amount
of the Revolving Loan
described below and/or any other financial accommodation provided
thereunder), refinancings, renewals, substitutions, replacements and/or
redatings thereof being hereinafter called the “Loan Agreement” in this
Note.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b)           This
Note restates, replaces and substitutes for the $35,000,000 “master” Revolving
Note executed by BORROWER in favor of LENDER (then known as Fleet Capital
Corporation) and dated as of June 1, 2005.  This Note evidences the
Revolving Loan described and defined in the Loan Agreement.

     

    (c)           It
is BORROWER’s intention that, in addition to this Note, the borrowing and the
indebtedness owed by BORROWER to LENDER under the Revolving Loan shall be
evidenced by LENDER’s records described below.

     

    (d)           (1)           As
it relates to LENDER’s aforementioned records, BORROWER hereby authorizes LENDER
to record on LENDER’s records all advances made by LENDER to BORROWER under this
Note and all interest and other amounts due hereon and all payments made on
account of principal and/or interest and/or such other amounts.  The
aggregate unpaid principal and/or interest and/or other amounts entered and
shown on LENDER’s records shall further evidence the principal and/or interest
and/or other amounts owing and unpaid on the Revolving Loan. LENDER may from
time to time render, or cause LENDER to render, a statement of the
aforementioned records. If BORROWER fails to object to any such statement within
sixty (60) days after it is received by BORROWER, such statement shall be deemed
to be an account stated and binding upon BORROWER, provided, however, that
nothing in the foregoing shall prevent LENDER or BORROWER from correcting
manifest errors in such statements.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (2)           Notwithstanding
the foregoing, the following shall apply:

     

    
      	
               
      

            	
              (A)

            	
              Any
      failure by LENDER to enter on its records the date and amount of any
      advance or interest or other amount due on this Note or any failure by
      LENDER to render any such statement shall not, however, limit or otherwise
      affect the obligations of BORROWER under the Loan Agreement or under this
      Note to repay the principal amount of the advances, re-advances,
      borrowings and re-borrowings made by LENDER to BORROWER under the
      Revolving Loan and this Note, together with all interest accruing and
      other amounts due thereon.

            


    

    


    
      	
               
      

            	
              (B)

            	
              The
      failure by LENDER to enter on its records the date and amount of any
      payment made by BORROWER shall not, however, limit or otherwise affect the
      right of BORROWER under the Revolving Loan or this Note to demonstrate its
      payment of any Advance or any interest accruing and other amounts due
      thereon.

            


    

    


    3.           LIMITATION ON OUTSTANDING
BORROWINGS:  Notwithstanding the face amount of this Note, the
total of all outstanding borrowings under this Note shall not at any one time
exceed the Lending Formula set forth in the Loan Agreement.

     

    4.           PROCEDURE FOR ADVANCES AND
DISBURSEMENTS:  All requests by BORROWER for an advance under
this Note and all disbursements made by LENDER under this Note shall be made
pursuant to the terms of the Loan Agreement.

     

    5.           RIGHT TO RECEIVE
ADVANCES:  BORROWER may receive advances under this Note to the
extent allowed by the Loan Agreement.

     

    6.           REPAYMENT OF
PRINCIPAL:  The principal due under this Note shall be paid in
full on June 30, 2011,
or in all cases sooner at the times and in the manner set forth in the
Loan Agreement.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    7.           PAYMENT OF INTEREST ON THE REVOLVING
LOAN:  The interest payable under this Note shall be calculated
and paid at the times and in the manner set forth in the Loan
Agreement.

     

    8.           INDEMNIFICATION RELATING TO LIBOR
OPTION:

     

    (a)           BORROWER
agrees to indemnify LENDER against any loss or expense which LENDER may sustain
or incur as a consequence of (1) any failure by BORROWER to borrow all or any
portion of any Principal Balance (relating to Advances Outstanding under the
Revolving Loan as to which BORROWER has elected to have interest determined or
to be determined, as applicable, at a LIBOR Based Rate and as more fully defined
above) or (2) the receipt or recovery by LENDER of all or any part of any
Principal Balance prior to the maturity thereof whether by voluntary or
involuntary prepayment, acceleration or otherwise.  Capitalized terms
used in this Paragraph shall have the meaning given those terms in the Loan
Agreement.

     

    (b)           The
aforementioned indemnification will be governed in the manner and in the amounts
set forth in the Loan Agreement.

     

    (c)           In
addition, nothing in the foregoing shall limit BORROWER’s liability under any
Master Agreement described in the Loan Agreement.

     

    9.           AUTHORIZATION TO CHARGE
ACCOUNT: Although LENDER may bill BORROWER monthly for accrued monthly
interest and other amounts (including principal) due under this Note and the
Revolving Loan, it is understood that LENDER will, and BORROWER hereby
authorizes LENDER to, charge as of each due date such interest and any other
amounts (including principal)and effect payment by increasing the principal
balance of the Revolving Loan as though an advance were taken by BORROWER
against the Revolving Loan in the amount of any payment effected by
LENDER.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    10.           PREPAYMENT:  BORROWER
may prepay the amounts due under this Note only as allowed by the Loan
Agreement.

     

    11.           LATE
CHARGES:  BORROWER shall be liable for the payment of “late”
charges in the amounts and as set forth in the Loan Agreement.

     

    12.           AUTHORIZATION TO CHARGE
ACCOUNT:  BORROWER hereby authorizes LENDER to charge and
effect payment as of each due date of all interest and other amounts (including
principal) due under this Note and the Revolving Loan in the manner set forth in
the “Authorization to
Charge” (as defined in the Loan Agreement).

     

    13.           PLACE OF
PAYMENT:  All payments made under this Note shall be made at
LENDER’s offices as specified in the Loan Agreement or at any other location
that the holder of this Note may designate by written notice to BORROWER given
in accordance with the Loan Agreement.

     

    14.           DEFINITIONS:  The
definitions contained in the Loan Agreement are incorporated herein by
reference.

     

    15.           CONTINUING RIGHTS OF
LENDER:  LENDER’s rights under this Note shall remain in full
force and effect until all Liabilities (as defined in the Loan Agreement) are
paid in full.

     

    16.           HOLDER ENTITLED TO BENEFITS OF LOAN
AGREEMENT:  The terms of the Loan Agreement are incorporated
herein by reference and the holder of this Note is entitled to the benefits of
the Loan Agreement.

     

    17.           EVENTS OF
DEFAULT:  The occurrence of any of the following shall be an
event of default (an “Event of
Default”) hereunder:

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (a)

            	
              BORROWER’s failure to pay any
      principal or interest when due under this
Note;

            


    

     

    
      	
               
      

            	
              (b)

            	
              BORROWER’s failure to perform
      any obligation due under this Note;
and

            


    

     

    (c)           the
occurrence of any Event of Default under the Loan Agreement.

     

    18.           REMEDIES:

     

    (a)           Upon
the occurrence of an Event of Default, LENDER may do any or all of the
following:

     

    (1)                      LENDER
may declare the entire principal amount of this Note or the unpaid balance
hereof, together with all accrued interest and all other lawful and proper
charges and other sums due hereunder and under the Loan Agreement (including
attorneys fees for collection and enforcement of LENDER's rights) immediately
due and payable with interest thereafter at the Default Rate, without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by BORROWER; and/or

     

    (2)                      LENDER
may exercise all other rights and remedies available to it at law or in
equity.

     

    (b)           The
remedies of LENDER under this Note are in addition to all other remedies,
statutory and otherwise, which are available to it under law or under the terms
of the Loan Agreement and all other Loan Documents.

     

    19.           WAIVER OF
PRESENTMENT:  Presentment, demand, protest, notice of dishonor
and any other notice of any kind are hereby expressly waived.

     

    
      
        
        

      

      
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    20.           NEW JERSEY LAW
GOVERNS:  This Note shall be governed in accordance with the
laws of the State of New Jersey.

     

    21.           LOST NOTE:  Upon
receipt of an affidavit of an officer of LENDER as to the loss, theft,
destruction or mutilation of this Note, BORROWER will issue, in lieu thereof, a
replacement Note in the same principal amount hereof and otherwise of like
tenor.

     

    22.           PLEDGE TO FEDERAL
RESERVE:  LENDER may at any time pledge all or any portion of
its rights under the aforementioned Loan Documents, including any portion of
this Note, to any of the twelve Federal Reserve Banks organized under Section 4
of the Federal Reserve Act, 12 U.S.C. Section 341.  No such pledge or
enforcement thereof shall release LENDER from its obligations under any of such
Loan Documents.

     

    23.           ASSIGNMENTS/PARTICIPATIONS:  Assignments
and Participations of LENDER’s interest in this Note are allowed as set forth in
the Loan Agreement.

     

    24.           WAIVER OF JURY
TRIAL:  BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES ITS RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED
HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE, THE LOAN
AGREEMENT AND ANY OTHER LOAN DOCUMENTS CONTEMPLATED TO BE EXECUTED IN CONNECTION
HEREWITH OR THEREWITH OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF LENDER. THIS WAIVER CONSTITUTES A
MATERIAL INDUCEMENT FOR LENDER TO ENTER INTO THE LOAN AGREEMENT AND MAKE AND
CONTINUE THE REVOLVING LOAN.

    


    
      
        
        

      

      
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IN
WITNESS WHEREOF, BORROWER has caused this Note to be signed by its duly
authorized representatives on the date first above written.

    

     

    
      
        	ATTEST:   	FIVE STAR GROUP,
      INC.	 
	 	 	 
	 	 	 	 
	

                /s/
      IRA SOBOTKO

              	
                 

              	
                By:
      

              	/s/
      JOHN BELKNAP	 
	Ira
      Sobotko, Secretary   	 	John
      Belknap, Vice  President	 
	 	 	 	 
	 	 	 	 


      



     

     

     

     

     

     

     

     

     

     

     

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