**Exhibit 10.15**

 

**PROMISSORY NOTE**

 

| $45,000.00 |   | Phoenix, Arizona       |
|------------|--------|------------------------|
|       |   | December 26, 2002 |
|       |   | Note Doc. 01070345     |

 

FOR VALUED RECEIVED, theundersigned RRF LIMITED PARTNERSHIP, a Delaware partnership, (“Maker”),promises to pay to the order of Capital Resource Lenders-I, L.L.C., anArizona limited liability company, (the “Payee”; Payee and each subsequenttransferee and/or owner of this Note, whether taking by endorsement orotherwise, are herein successively called “Holder”) at 1615 East NorthernAvenue, Suite 102, Phoenix, Arizona 85020-3932, or at such other place asthe Holder may from time to time designate in writing, the principal sum ofFORTY FIVE THOUSAND AND 00/100 DOLLARS ($45,000.00), or so much as has beenadvanced, plus interest calculated on a daily basis (based on a 360-dayyear) from the date hereof on the principal balance from time to timeoutstanding as hereinafter provided, principal, interest and all other sumspayable hereunder to be paid in lawful money of the United States of America asfollows:

 

(A)                              During the term of the Note, interest shallaccrue quarterly at the floating rate equal to the greater of (i) 8% perannum or (ii) the Prime Rate plus 0.5%, and shall be adjusted at thebeginning of each calendar quarter. Notwithstanding the foregoing, at no timeshall the interest rate hereunder be greater than 10% per annum. The PrimeRate is defined as the rate of interest, as of the first business day of eachquarter, designated in The Wall Street Journal as the “prime rate.”

 

(B)                                All accrued interest shall be due and payableon the first day of each calendar quarter after the date of this Notecommencing with April 1, 2003, and continuing on each July 1,October 1, January 1 thereafter until this Note is paid in full.

 

(C)                                Payments shall be interest only, payablequarterly until April 1, 2003; commencing on April 1, 2003, quarterlypayments shall include both interest and principal amortized over 20 years.

 

(D)                               The entire unpaid principal balance, allaccrued and unpaid interest, and all other amounts payable hereunder shall bedue and payable in full no later than September 30, 2009.

 

Maker hereby agrees that not less than 80% of each advance shall beused by Maker to reduce the obligations under that certain loan secured by adeed of trust in first position on the Real Property in the original principalamount of $1,825,000. Advances shall in no event exceed the maximum principalamount of this Note. Any advances made shall be and become sums secured by thisNote and subject to repayment pursuant to the terms hereof. Notwithstandinganything herein to the contrary, Lender shall not be obliged to make anyadvance under this Note and the determination to provide any advances requestedby Maker shall be made in Lender’s sole and absolute discretion.

 

If payment is ten (10) days or more late, Maker will be charged fivepercent (5%) of the regularly scheduled payment. This late charge may beassessed without written notice and shall be immediately due and payable andshall be in addition to all other rights and remedies available to Holder.

 

Unless otherwise agreed to, in writing, or otherwise required byapplicable law, payments will be applied first to late charges and any unpaidcollection costs, then to accrued, unpaid interest, then to principal and

 

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other charges; provided, however, upon delinquency or other default,Holder reserves the right to apply payments among principal, interest, latecharges, collection costs and other charges at its discretion. All prepaymentsshall be applied to the indebtedness owing hereunder in such order and manneras Holder may from time to time determine in its sole discretion.

 

This Note is issued pursuant to that Loan Agreement (the “LoanAgreement”) of even date herewith between Maker and Payee and is secured by,among other things, one or more Deeds of Trust, Assignments of Rents, SecurityAgreements and Fixture Filings (collectively, the “Deed of Trust”) of even dateherewith, executed by Maker, as trustor, in favor of Payee, as beneficiary,encumbering property situated in Scottsdale, Maricopa County, Arizona, (the“Real Property”). The Deed of Trust and all other documents or instrumentssecuring the indebtedness evidenced by this Note or executed or delivered inconnection with the indebtedness evidenced by this Note are hereinafter calledthe “Security Documents.” The capitalized terms used herein and not otherwisedefined shall have the same meanings as set forth in the Loan Agreement.

 

Time is of the essence of this Note. At the option of Holder, the entireunpaid principal balance, all accrued and unpaid interest and all other amountspayable hereunder shall become immediately due and payable without notice uponthe failure to pay any sum due and owing hereunder as provided herein if suchfailure continues for thirty (30) days after written notice thereof to Maker orupon the occurrence of any Event of Default as defined in the Loan Agreement orany of the Security Documents.

 

Upon default, including failure to pay upon final maturity, Holder, atis option, may also, if permitted under applicable law, do one or both of thefollowing: (a) increase the applicable interest rate on this Note tofifteen percent (15%) per annum, and (b) add any unpaid accrued interestto principal and such sum will bear interest therefrom until paid at the rateprovided in this Note (including any increased rate). The interest rate willnot exceed the maximum rate permitted by applicable law. Maker shall pay allcosts and expenses, including reasonable attorneys’ fees and court costs,incurred in the collection or enforcement of all or any part of this Note. Allsuch costs and expenses shall be secured by the Deed of Trust and by all otherSecurity Documents. In the event of any court proceedings, court costs andattorneys’ fees shall be set by the court and not by jury and shall be includedin any judgment obtained by Holder.

 

Maker shall not be entitled to prepay this Note at any time during thefirst year of the Note. Thereafter, Maker shall have the option to prepay thisNote, in full or in part, at any time, provided that Maker pays a 4% prepaymentpenalty based on the amount prepaid and Holder receives at leastfive (5) days prior written notice of the intent to make suchprepayment.

 

Failure of Holder to exercise any option hereunder shall not constitutea waiver of the right to exercise the same in the event of any subsequentdefault or in the event of continuance of any existing default after demand forstrict performance hereof.

 

Maker and all sureties, guarantors and/or endorsers hereof (or of anyobligation hereunder) and accommodation parties hereon (all of which, includingMaker, are severally each hereinafter called a “Surety”) each:  (a) agree that the liability under thisNote of all parties hereto is joint and several; (b) severally waive anyhomestead or exemption laws and right thereunder affecting the full collectionof this Note; (c) severally waive any and all formalities in connectionwith this Note to the maximum extent allowed by law, including (but not limitedto) demand, diligence, presentment for payment, protest and demand, and noticeof extension, dishonor, protest, demand and nonpayment of this Note; and(d) consent that Holder may extend the time of payment or otherwise modifythe terms of payment of any part or the whole of the debt evidenced by thisNote at the request of any other person liable hereon, and such consent shallnot alter nor diminish the liability of any person hereon.

 

                

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Maker agrees that to the extent Maker or any Surety makes any paymentto Holder in connection with the indebtedness evidenced by this Note, and allor any part of such payment is subsequently invalidated, declared to befraudulent or preferential, set aside or required to be repaid by Holder orpaid over to a trustee, receiver or any other entity, whether under anybankruptcy act or otherwise (any such payment is hereinafter referred to as a“Preferential Payment”), then the indebtedness of Maker under this Note shallcontinue or shall be reinstated, as the case may be, and, to the extent of suchpayment or repayment by Holder, the indebtedness evidenced by this Note or partthereof intended to be satisfied by such Preferential Payment shall be revivedand continued in full force and effect as if said Preferential Payment had notbeen made.

 

Without limiting the right of Holder to bring any action or proceedingagainst Maker or any Surety or against any property of Maker or any Surety (an“Action”) arising out of or relating to this Note or any indebtedness evidencedhereby in the courts of other jurisdictions, Maker and each Surety herebyirrevocably submit to the jurisdiction, process and venue of any Arizona Stateor Federal court sitting in Phoenix, Arizona, and hereby irrevocably agree thatany Action may be heard and determined in such Arizona State court or in suchFederal court. Maker and all Sureties each hereby irrevocably waives, to thefullest extent it may effectively do so, the defenses of lack of jurisdictionover any person, inconvenient forum or improper venue, to the maintenance ofany Action in any jurisdiction.

 

This Note shall be binding upon Maker and its successors and assignsand shall inure to the benefit of Payee, and any subsequent holders of thisNote, and their successors and assigns.

 

All notices required or permitted in connection with this Note shall begiven at the place and in the manner provided in the Loan Agreement for thegiving of notices.

 

This Note shall be governed by and construed according to the laws ofthe State of Arizona, without giving effect to conflict of laws principles.

** **

**JURY WAIVER.** THEUNDERSIGNED AND HOLDER (BY ITS ACCEPTANCE HEREOF) HEREBY VOLUNTARILY,KNOWINGLY, IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY RIGHT TO HAVE A JURYPARTICIPATE IN RESOLVING ANY DISPUTE (WHETHER BASED UPON CONTRACT, TORT OROTHERWISE) BETWEEN OR AMONG THE UNDERSIGNED AND HOLDER ARISING OUT OF OR IN ANYWAY RELATED TO THIS DOCUMENT OR ANY OTHER AGREEMENTS, DOCUMENTS OR INSTRUMENTSEXECUTED OR DELIVERED IN CONNECTION WITH, OR OTHERWISE RELATING TO, THEINDEBTEDNESS EVIDENCED HEREBY (TOGETHER WITH THIS NOTE, THE “RELATEDDOCUMENTS”), OR ANY RELATIONSHIP BETWEEN HOLDER AND THE UNDERSIGNED. THISPROVISION IS A MATERIAL INDUCEMENT TO HOLDER TO PROVIDE THE FINANCING DESCRIBEDHEREIN OR IN THE OTHER RELATED DOCUMENTS.

 

IN WITNESS WHEREOF, these presents are executed as of the date firstwritten above.

 
|   | MAKER                                                                                                                                         |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                          |
|   |                                                                                                                                          |
|   | RRF LIMITED PARTNERSHIP, A Delaware limited  partnership, InnSuites Hospitality Trust, General Partner,  an Ohio real estate investment trust |
|   |                                                                                                                                          |
|   | By:                                                                                                                                           | /s/  Marc E. Berg |   |
|   |                                                                                                                                          | Name: Marc E. Berg |
|   |                                                                                                                                          | Title:   Executive  Vice-President |

 

 

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