20-APPROVE RESOLUTION ACKNOWLEDGING/APPROVAL LOAN AGREEMENT & PROMISSORY NOTE BETWEEN PEDC AND CAPITAL ONE

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E DRAFT PROMISSORY NOTE Borrower: PARIS ECONOMIC DEVELOPMENT CORPORATION A Texas Non-Stock, Non-Profit Industrial Development Corporation 1125 Bonham Street, Paris, Texas 75460 Lender: CAPITAL ONE, N.A. 1680 Capital One Drive McLean, Virginia 22102 Principal Amount: $2,000,000.00 Initial Rate: 1.290% Date of Note: September 1, 2011 PROMISE TO PAY. PARIS ECONOMIC DEVELOPMENT CORPORATION, A Texas Non-Stock, Non-Profit Industrial Development Corporation ("Borrower"), by and through its duly authorized President, M. PIKE BURKHART, SR., promises to pay to the order of CAPITAL ONE, N.A. ("Lender"), in lawful money of the United States of America, the principal amount of Two million and no/100 ($2,000,000.00) Dollars, or so much as may be outstanding, together with interest on the unpaid outstanding principal balance of each advance. Interest shall be calculated from the date of each advance until repayment of such advance. CHOICE OF USURY CEILING AND INTEREST RATE. The interest rate on this Note has been implemented under the "Weekly Ceiling" as referred to in Sections 303.002 and 303.003 of the Texas Finance Code. The terms, including the rate, or index, formula, or provision of law used to compute the rate on the Note, will be subject to revision as to current and future balances, from time to time by notice from Lender in compliance with Section 303.103 of the Texas Finance Code. PAYMENT. Borrower will pay this loan in one payment of all outstanding principal plus all accrued unpaid interest on September 1, 2012. In addition, Borrower will pay regular monthly payments of all accrued unpaid interest due as of each payment date, beginning October 1, 2011, with all subsequent interest payments to be made on the same day of each month thereafter. Borrower's first payment is due October 1, 2011, and all subsequent payments are due on the same day of each month thereafter. Unless otherwise agreed or required by applicable law, payments will be applied first to accrued unpaid interest, then to principal, and any remaining amount to any unpaid collection costs and late charges. Borrower will pay Lender at Lender's address shown above or at such other place as Lender may designate in writing. Notwithstanding any other provision of this Note, Lender will not charge interest on any undisbursed loan proceeds. No scheduled payment, whether of principal or interest or both, will be due unless sufficient loan funds have been disbursed by the scheduled payment date to justify the payment. VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from time to time based on changes in an independent index which is the WALL STREET JOURNAL PRIME RATE (the "Index"). The Index is not necessarily the lowest rate charged by Lender on its loans. If the Index becomes unavailable during the term of this loan, Lender may designate a substitute index after notice to Borrower. Lender will tell Borrower the current index upon Borrower's request. The interest rate change will not occur more often than each DAY. Borrower understands that Lender may make loans based on other rates as well. The Index is currently 3.250% per annum. Interest on the unpaid principal balance of this Note will be calculated as described in the "INTEREST CALCULATION METHOD" paragraph below, using a rate of 1.96 percentage points under the Index, resulting in an initial rate of 1.29% per annum based on a year of 3 60 days. NOTICE: Under no circumstances will the interest rate on this Note be more than the maximum rate - 123