BUSINESS LOAN AGREEMENT (ASSET BASED)
Principal $1,000,000
Loan Date 05-22-2008
Maturity 05-22-2009
Loan No. 000000000
Call/Coll 4A/130
Account S00422
Officer DJR
Initials
References in the boxes above are for Xxxxxx's use only and do not limit
the applicability of this document to any particular loan or item.
Any item above containing " * * * " has been omitted due to text length
limitations.
Borrower:
Xxxxxx XX, Inc.
0000 Xxxxxx Xxxxxxxx Xxxxxxx
Xxxxx, XX 00000
Lender:
Signature Bank
0000 Xxxx Xxxx Xxxx Xxx 000
Xxxxxxxxxx, XX 00000
THIS BUSINESS LOAN AGREEMENT (ASSET BASED) dated May 22, 2008, is made and
executed between Xxxxxx XX, Inc. ("Borrower") and Signature Bank
("Lender") on the following terms and conditions. Borrower has received
prior commercial loans from Lender or has applied to Lender for a
commercial loan or loans or other financial accommodations, including
those which may be described on any exhibit or schedule attached to this
Agreement ("Loan"). Xxxxxxxx understands and agrees that: (A) in granting,
renewing, or extending any Loan, Lender is relying upon Borrower's
representations, warranties, and agreements as set forth in this Agreement;
(B) the granting, renewing, or extending of any Loan by Xxxxxx
at all times shall be subject to Xxxxxx's sole judgment and discretion;
and (C) all such Loans shall be and remain subject to the terms and
conditions of this Agreement.
TERM. This Agreement shall be effective as of May 22, 2008, and shall
continue in full force and effect until such time as all of Borrower's
Loans in favor of Lender have been paid in full, including principal,
interest, costs, expenses, attorneys' fees, and other fees and charges,
or until May 22, 2009.
LINE OF CREDIT. Xxxxxx agrees to make Advances to Borrower from time to
time from the date of this Agreement to the Expiration Date, provided the
aggregate amount of such Advances outstanding at any time does not exceed
the Borrowing Base. Within the foregoing limits, Borrower may borrow,
partially or wholly prepay, and reborrow under this Agreement as follows:
Conditions Precedent to Each Advance. Xxxxxx's obligation to make any
Advance to or for the account of Borrower under this Agreement is subject
to the following conditions precedent, with all documents, instruments,
opinions, reports, and other items required under this Agreement to be in
form and substance satisfactory to Lender:
(1) Lender shall have received evidence that this Agreement and all
Related Documents have been duly authorized, executed, and delivered by
Xxxxxxxx to Lender.
(2) Lender shall have received such opinions of counsel, supplemental
opinions, and documents as Xxxxxx may request.
(3) The security interests in the Collateral shall have been duly
authorized, created, and perfected with first lien priority and shall be
in full force and effect.
(4) All guaranties required by Lender for the credit facility(ies) shall
have been executed by each Guarantor, delivered to Lender, and be in full
force and effect.
(5) Lender, at its option and for its sole benefit, shall have conducted
an audit of Xxxxxxxx's Accounts, books, records, and operations, and Lender
shall be satisfied as to their condition.
(6) Borrower shall have paid to Lender all fees, costs, and expenses
specified in this Agreement and the Related Documents as are then due
and payable.
(7) There shall not exist at the time of any Advance a condition which
would constitute an Event of Default under this Agreement, and Borrower
shall have delivered to Lender the compliance certificate called for in
the paragraph below titled "Compliance Certificate."
Making Loan Advances. Advances under this credit facility, as well as
directions for payment from Xxxxxxxx's accounts, may be requested orally
or in writing by authorized persons. Lender may, but need not, require
that all oral requests be confirmed in writing. Each Advance shall be
conclusively deemed to have been made at the request of and for the benefit
of Borrower (1) when credited to any deposit account of Borrower maintained
with Lender or (2) when advanced in accordance with the instructions of an
authorized person. Lender, at its option, may set a cutoff time, after
which all requests for Advances will be treated as having been requested
on the next succeeding Business Day.
Mandatory Loan Repayments. If at any time the aggregate principal amount
of the outstanding Advances shall exceed the applicable Borrowing Base,
Borrower, immediately upon written or oral notice from Lender, shall pay
to Lender an amount equal to the difference between the outstanding
principal balance of the Advances and the Borrowing Base. On the Expiration
Date, Borrower shall pay to Lender in full the aggregate unpaid principal
amount of all Advances then outstanding and all accrued unpaid interest,
together with all other applicable fees, costs and charges, if any, not
yet paid.
Loan Account. Lender shall maintain on its books a record of account in
which Lender shall make entries for each Advance and such other debits and
credits as shall be appropriate in connection with the credit facility.
Lender shall provide Borrower with periodic statements of Xxxxxxxx's account,
which statements shall be considered to be correct and conclusively
binding on Borrower unless Borrower notifies Lender to the contrary within
thirty (30) days after Xxxxxxxx's receipt of any such statement which
Borrower deems to be incorrect.
COLLATERAL. To secure payment of the Primary Credit Facility and
performance of all other Loans, obligations and duties owed by Borrower
to Lender, Borrower (and others, if required) shall grant to Lender
Security Interests in such property and assets as Lender may require.
Lender's Security Interests in the Collateral shall be continuing liens
and shall include the proceeds and products of the Collateral, including
without limitation the proceeds of any insurance. With respect to the
Collateral, Xxxxxxxx agrees and represents and warrants to Xxxxxx:
Perfection of Security Interests. Xxxxxxxx agrees to execute all documents
perfecting Xxxxxx's Security Interest and to take whatever actions are
requested by Xxxxxx to perfect and continue Xxxxxx's Security Interests in
the Collateral. Upon request of Xxxxxx, Xxxxxxxx will deliver to Lender any
and all of the documents evidencing or constituting the Collateral, and
Borrower will note Xxxxxx's interest upon any and all chattel paper and
instruments if not delivered to Lender for possession by Xxxxxx.
Contemporaneous with the execution of this Agreement, Xxxxxxxx will execute
one or more UCC financing statements and any similar statements as may be
required by applicable law, and Lender will file such financing statements
and all such similar statements in the appropriate location or locations.
Borrower hereby appoints Xxxxxx as its irrevocable attorney-in-fact for
the purpose of executing any documents necessary to perfect or to continue
any Security Interest. Lender may at any time, and without further
authorization from Borrower, file a carbon, photograph, facsimile, or other
reproduction of any financing statement for use as a financing statement.
Borrower will reimburse Lender for all expenses for the perfection,
termination, and the continuation of the perfection of Xxxxxx's security
interest in the Collateral. Borrower promptly will notify Lender before
any change in Xxxxxxxx's name including any change to the assumed business
names of Xxxxxxxx. Borrower also promptly will notify Lender before any
change in Borrower's Social Security Number or Employer Identification Number.
Xxxxxxxx further agrees to notify Xxxxxx in writing prior to any change in
address or location of Xxxxxxxx's principal governance office or should
Borrower merge or consolidate with any other entity.
Collateral Records. Borrower does now, and at all times hereafter shall,
keep correct and accurate records of the Collateral, all of which records
shall be available to Lender or Xxxxxx's representative upon demand for
inspection and copying at any reasonable time. With respect to the Accounts,
Xxxxxxxx agrees to keep and maintain such records as Lender may require,
including without limitation information concerning Eligible Accounts and
Account balances and agings. Records related to Accounts (Receivables) are
or will be located at . The above is an accurate and complete list of all
locations at which Borrower keeps or maintains business records concerning
Xxxxxxxx's collateral.
Collateral Schedules. Concurrently with the execution and delivery of this
Agreement, Borrower shall execute and deliver to Lender schedules of Accounts
and schedules of Eligible Accounts in form and substance satisfactory to
the Lender. Thereafter supplemental schedules shall be delivered according
to the following schedule:
Representations and Warranties Concerning Accounts. With respect to the
Accounts, Borrower represents and warrants to Lender: (1) Each Account
represented by Borrower to be an Eligible Account for purposes of this
Agreement conforms to the requirements of the definition of an Eligible
Account; (2) All Account information listed on schedules delivered to
Lender will be true and correct, subject to immaterial variance; and (3)
Lender, its assigns, or agents shall have the right at any time and at
Borrower's expense to inspect, examine, and audit Xxxxxxxx's records and to
confirm with Account Debtors the accuracy of such Accounts.
CONDITIONS PRECEDENT TO EACH ADVANCE. Lender's obligation to make the
initial Advance and each subsequent Advance under this Agreement shall
be subject to the fulfillment to Xxxxxx's satisfaction of all of the
conditions set forth in this Agreement and in the Related Documents.
Loan Documents. Borrower shall provide to Lender the following documents
for the Loan: (1) the Note; (2) Security Agreements granting to Lender
security interests in the Collateral; (3) financing statements and all
other documents perfecting Lender's Security Interests; (4) evidence of
insurance as required below; (5) assignments of life insurance;
(6) guaranties; (7) together with all such
BUSINESS LOAN AGREEMENT (ASSET BASED)
Loan No: 200725801 (Continued) Page 2
Related Documents as Lender may require for the Loan; all in form and
substance satisfactory to Lender and Xxxxxx's counsel.
Borrower's Authorization. Borrower shall have provided in form and
substance satisfactory to Lender properly certified resolutions, duly
authorizing the execution and delivery of this Agreement, the Note and
the Related Documents. In addition, Borrower shall have provided such
other resolutions, authorizations, documents and instruments as Lender
or its counsel, may require.
Fees and Expenses Under This Agreement. Borrower shall have paid to Lender
all fees, costs, and expenses specified in this Agreement and the Related
Documents as are then due and payable.
Representations and Warranties. The representations and warranties set
forth in this Agreement, in the Related Documents, and in any document or
certificate delivered to Lender under this Agreement are true and correct.
No Event of Default. There shall not exist at the time of any Advance a
condition which would constitute an Event of Default under this Agreement
or under any Related Document.
REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants to Lender,
as of the date of this Agreement, as of the date of each disbursement of
loan proceeds, as of the date of any renewal, extension or modification of
any Loan, and at all times any Indebtedness exists:
Organization. Borrower is a corporation for profit which is, and at all
times shall be, duly organized, validly existing, and in good standing
under and by virtue of the laws of the State of Minnesota. Borrower is
duly authorized to transact business in all other states in which Borrower
is doing business, having obtained all necessary filings, governmental
licenses and approvals for each state in which Borrower is doing business.
Specifically, Borrower is, and at all times shall be, duly qualified as a
foreign corporation in all states in which the failure to so qualify would
have a material adverse effect on its business or financial condition.
Borrower has the full power and authority to own its properties and to
transact the business in which it is presently engaged or presently
proposes to engage. Borrower maintains an office at 0000 Xxxxxx Xxxxxxxx
Xxxxxxx, Xxxxx, XX 00000. Unless Borrower has designated otherwise in
writing, the principal office is the office at which Borrower keeps its
books and records including its records concerning the Collateral. Borrower
will notify Lender prior to any change in the location of
Xxxxxxxx's state of organization or any change in Borrower's name.
Borrower shall do all things necessary to preserve and to keep in full
force and effect its existence, rights and privileges, and shall comply
with all regulations, rules, ordinances, statutes, orders and decrees of
any governmental or quasi-governmental authority or court applicable to
Borrower and Xxxxxxxx's business activities.
Assumed Business Names. Xxxxxxxx has filed or recorded all documents or
filings required by law relating to all assumed business names used by
Xxxxxxxx. Excluding the name of Xxxxxxxx, the following is a complete
list of all assumed business names under which Borrower does business:
Borrower Assumed Business Name Filing Location Date
Xxxxxx XX, Inc. Xxxxxx Corporation Minnesota 02-09-1999
Authorization. Borrower's execution, delivery, and performance of this
Agreement and all the Related Documents have been duly authorized by
all necessary action by Borrower and do not conflict with, result in
a violation of, or constitute a default under (1) any provision of
(a) Borrower's articles of incorporation or organization, or bylaws, or
(b) any agreement or other instrument binding upon Borrower or (2) any law,
governmental regulation, court decree, or order applicable to Borrower
or to Borrower's properties.
Financial Information. Each of Xxxxxxxx's financial statements supplied
to Xxxxxx truly and completely disclosed Xxxxxxxx's financial condition
as of the date of the statement, and there has been no material adverse
change in Xxxxxxxx's financial condition subsequent to the date of the
most recent financial statement supplied to Lender. Borrower has no
material contingent obligations except as disclosed in such financial
statements.
Legal Effect. This Agreement constitutes, and any instrument or agreement
Borrower is required to give under this Agreement when delivered will
constitute legal, valid, and binding obligations of Borrower enforceable
against Borrower in accordance with their respective terms.
Properties. Except as contemplated by this Agreement or as previously
disclosed in Xxxxxxxx's financial statements or in writing to Lender and
as accepted by Xxxxxx, and except for property tax liens for taxes not
presently due and payable, Borrower owns and has good title to all of
Borrower's properties free and clear of all Security Interests, and has
not executed any security documents or financing statements relating to
such properties. All of Xxxxxxxx's properties are titled in Borrower's
legal name, and Xxxxxxxx has not used or filed a financing statement under
any other name for at least the last five (5) years.
Hazardous Substances. Except as disclosed to and acknowledged by Xxxxxx in
writing, Borrower represents and warrants that: (1) During the period of
Borrower's ownership of the Collateral, there has been no use, generation,
manufacture, storage, treatment, disposal, release or threatened release
of any Hazardous Substance by any person on, under, about or from any of
the Collateral. (2) Borrower has no knowledge of, or reason to believe that
there has been (a) any breach or violation of any Environmental Laws;
(b) any use, generation, manufacture, storage, treatment, disposal, release
or threatened release of any Hazardous Substance on, under, about or from
the Collateral by any prior owners or occupants of any of the Collateral;
or (c) any actual or threatened litigation or claims of any kind by any
person relating to such matters. (3) Neither Borrower nor any tenant,
contractor, agent or other authorized user of any of the Collateral shall
use, generate, manufacture, store, treat, dispose of or release any
Hazardous Substance on, under, about or from any of the Collateral; and
any such activity shall be conducted in compliance with all applicable
federal, state, and local laws, regulations, and ordinances, including
without limitation all Environmental Laws. Borrower authorizes Lender and
its agents to enter upon the Collateral to make such inspections and tests
as Lender may deem appropriate to determine compliance of the Collateral
with this section of the Agreement. Any inspections or tests made by Lender
shall be at Borrower's expense and for Lender's purposes only and shall not
be Construed to create any responsibility or liability on the part of Lender
to Borrower or to any other person. The representations and warranties
contained herein are based on Borrower's due diligence in investigating
the Collateral for hazardous waste and Hazardous Substances. Borrower hereby
(1) releases and waives any future claims against Lender for indemnity or
contribution in the event Borrower becomes liable for cleanup or other costs
under any such laws, and (2) agrees to indemnify, defend, and hold harmless
Lender against any and all claims, losses, liabilities, damages, penalties,
and expenses, including attorneys' fees, consultants' fees, and costs which
Lender may directly or indirectly sustain or suffer resulting from a breach
of this section of the Agreement or as a consequence of any use, generation,
manufacture, storage, disposal, release or threatened release of a hazardous
waste or substance on the Collateral. The provisions of this section of the
Agreement, including the obligation to indemnify and defend, shall survive
the payment of the Indebtedness and the termination, expiration or
satisfaction of this Agreement and shall not be affected by Lender's
acquisition of any interest in any of the Collateral, whether by foreclosure
or otherwise.
Litigation and Claims. No litigation, claim, investigation, administrative
proceeding or similar action (including those for unpaid taxes) against
Borrower is pending or threatened, and no other event has occurred which
may materially adversely affect Borrower's financial condition or properties,
other than litigation, claims, or other events, if any, that have been
disclosed to and acknowledged by Xxxxxx in writing.
Taxes. To the best of Xxxxxxxx's knowledge, all of Xxxxxxxx's tax returns
and reports that are or were required to be filed, have been filed, and
all taxes, assessments and other governmental charges have been paid in
full, except those presently being or to be contested by Borrower in good
faith in the ordinary course of business and for which adequate reserves
have been provided.
Lien Priority. Unless otherwise previously disclosed to Lender in writing,
Xxxxxxxx has not entered into or granted any Security Agreements, or
permitted the filing or attachment of any Security Interests on or affecting
any of the Collateral directly or indirectly securing repayment of Borrower's
Loan and Note, that would be prior or that may in any way be superior to
Xxxxxx's Security Interests and rights in and to such Collateral.
Binding Effect. This Agreement, the Note, all Security Agreements (if
any), and all Related Documents are binding upon the signers thereof, as
well as upon their successors, representatives and assigns, and are
legally enforceable in accordance with their respective terms.
AFFIRMATIVE COVENANTS. Borrower covenants and agrees with Xxxxxx that,
so long as this Agreement remains in effect, Borrower will:
Notices of Claims and Litigation. Promptly inform Xxxxxx in writing of
(1) all material adverse changes in Borrower's financial condition, and
(2) all existing and all threatened litigation, claims, investigations,
administrative proceedings or similar actions affecting Borrower or any
Guarantor which could materially affect the financial condition of Borrower
or the financial condition of any Guarantor.
Financial Records. Maintain its books and records in accordance with GAAP,
applied on a consistent basis, and permit Xxxxxx to examine and audit
Xxxxxxxx's books and records at all reasonable times.
Financial Statements. Furnish Lender with the following:
Interim Statements. As soon as available, but in no event later than
thirty (30) days after the end of each month, Xxxxxxxx's balance sheet
and profit and loss statement for the period ended, prepared by Xxxxxxxx.
BUSINESS LOAN AGREEMENT (ASSET BASED)
Loan No: 200725801 (Continued) Page 3
Additional Requirements. A/R Aging Report and Borrowing Base Certificate
of Xxxxxx Corporation: As soon as available, but in no event later than
thirty (30) days after the end of each month, Xxxxxxxx's Detailed Accounts
Receivable Aging Reports and Borrowing Base Certificate for the period
ended, prepared by Borrower.All financial reports required to be provided
under this Agreement shall be prepared in accordance with GAAP, applied
on a consistent basis, and certified by Borrower as being true and correct.
Additional Information. Furnish such additional information and statements,
as Xxxxxx may request from time to time.
Financial Covenants and Ratios. Comply with the following covenants and
ratios:
Minimum Income and Cash flow Requirements. Borrower shall comply with the
following cash flow ratio requirements:
Cash Flow / Current Maturity (LTD) Ratio. Maintain a ratio of Cash Flow /
Current Maturity (LTD) in excess of 1.200 to 1.000. The ratio "Cash Flow /
Current Maturity (LTD)" means Borrower's Net Profits plus Depreciation,
Depletion and Amortization divided by Borrower's Current Portion of Long
Term Indebtedness. This coverage ratio will be evaluated as of year-end.
Tangible Net Worth Requirements. Borrower shall comply with the following
net worth ratio requirements:
Debt / Worth Ratio. Maintain a ratio of Debt / Worth not in excess of
4.500 to 1.000. The ratio "Debt / Worth" means Borrower's Total Liabilities
divided by Borrower's Tangible Net Worth. This leverage ratio will be
evaluated as of year-end.Except as provided above, all computations made
to determine compliance with the requirements contained in this paragraph
shall be made in accordance with generally accepted accounting principles,
applied on a consistent basis, and certified by Borrower as being true and
correct.
Insurance. Maintain fire and other risk insurance, public liability
insurance, and such other insurance as Lender may require with respect to
Borrower's properties and operations, in form, amounts, coverages and with
insurance companies acceptable to Lender. Borrower, upon request of Xxxxxx,
will deliver to Lender from time to time the policies or certificates of
insurance in form satisfactory to Lender, including stipulations that
coverages will not be cancelled or diminished without at least thirty (30)
days prior written notice to Lender. Each insurance policy also shall
include an endorsement providing that coverage in favor of Lender will not
be impaired in any way by any act, omission or default of Borrower
or any other person. In connection with all policies covering assets in
which Lender holds or is offered a security interest for the Loans,
Borrower will provide Lender with such lender's loss payable or other
endorsements as Lender may require.
Insurance Reports. Furnish to Lender, upon request of Lender, reports on
each existing insurance policy showing such information as Lender may
reasonably request, including without limitation the following: (1) the
name of the insurer; (2) the risks insured; (3) the amount of the policy;
(4) the properties insured; (5) the then current property values on the
basis of which insurance has been obtained, and the manner of determining
those values; and (6) the expiration date of the policy. In addition,
upon request of Lender (however not more often than annually), Borrower
will have an independent appraiser satisfactory to Lender determine, as
applicable, the actual cash value or replacement cost of any Collateral.
The cost of such appraisal shall be paid by Borrower.
Life Insurance. As soon as practical, obtain and maintain life insurance in
form and with insurance companies acceptable to Lender on the following
individual in the amount indicated below and, at Lender's option, cause such
insurance coverage to be pledged, made payable to, or assigned to Lender on
Xxxxxx's forms. Lender, at its discretion, may apply the proceeds of any
insurance policy to the unpaid balances of any Loan:
Name / Title of Insured Amount
Xxxxxx X. Xxxxxx $1,000,000.00
Guaranties. Prior to disbursement of any Loan proceeds, furnish executed
guaranties of the Loans in favor of Xxxxxx, executed by the guarantors
named below, on Xxxxxx's forms, and in the amounts and under the conditions
set forth in those guaranties.
Names of Guarantors Amounts
Xxxxxx X. Xxxxxx Unlimited
Oakridge Holdings Inc Unlimited
Other Agreements. Comply with all terms and conditions of all other
agreements, whether now or hereafter existing, between Borrower and any
other party and notify Lender immediately in writing of any default in
connection with any other such agreements.
Loan Proceeds. Use all Loan proceeds solely for Xxxxxxxx's business
operations, unless specifically consented to the contrary by Xxxxxx in
writing.
Taxes, Charges and Liens. Pay and discharge when due all of its
indebtedness and obligations, including without limitation all assessments,
taxes, governmental charges, levies and liens, of every kind and nature,
imposed upon Borrower or its properties, income, or profits, prior to the
date on which penalties would attach, and all lawful claims that, if
unpaid, might become a lien or charge upon any of Borrower's properties,
income, or profits.
Performance. Perform and comply, in a timely manner, with all terms,
conditions, and provisions set forth in this Agreement, in the Related
Documents, and in all other instruments and agreements between Borrower
and Lender. Borrower shall notify Xxxxxx immediately in writing of any
default in connection with any agreement.
Operations. Maintain executive and management personnel with substantially
the same qualifications and experience as the present executive and
management personnel; provide written notice to Lender of any change in
executive and management personnel; conduct its business affairs in a
reasonable and prudent manner.
Environmental Studies. Promptly conduct and complete, at Borrower's expense,
all such investigations, studies, samplings and testings as may be
requested by Lender or any governmental authority relative to any substance,
or any waste or by-product of any substance defined as toxic or a hazardous
substance under applicable federal, state, or local law, rule, regulation,
order or directive, at or affecting any property or any facility owned,
leased or used by Borrower.
Compliance with Governmental Requirements. Comply with all laws, ordinances,
and regulations, now or hereafter in effect, of all governmental authorities
applicable to the conduct of Borrower's properties, businesses and
operations, and to the use or occupancy of the Collateral, including without
limitation, the Americans With Disabilities Act. Borrower may contest in
good faith any such law, ordinance, or regulation and withhold compliance
during any proceeding, including appropriate appeals, so long as Borrower
has notified Lender in writing prior to doing so and so long as, in
Xxxxxx's sole opinion, Xxxxxx's interests in the Collateral are not
jeopardized. Lender may require Borrower to post adequate security or a
surety bond, reasonably satisfactory to Lender, to protect Xxxxxx's interest.
Inspection. Permit employees or agents of Lender at any reasonable time to
inspect any and all Collateral for the Loan or Loans and Xxxxxxxx's other
properties and to examine or audit Xxxxxxxx's books, accounts, and records
and to make copies and memoranda of Xxxxxxxx's books, accounts, and records.
If Borrower now or at any time hereafter maintains any records (including
without limitation computer generated records and computer software programs
for the generation of such records) in the possession of a third party,
Borrower, upon request of Xxxxxx, shall notify such party to permit Lender
free access to such records at all reasonable times and to provide Lender
with copies of any records it may request, all at Borrower's expense.
Environmental Compliance and Reports. Borrower shall comply in all respects
with any and all Environmental Laws; not cause or permit to exist, as a
result of an intentional or unintentional action or omission on Borrower's
part or on the part of any third party, on property owned and/or occupied
by Borrower, any environmental activity where damage may result to the
environment, unless such environmental activity is pursuant to and in
compliance with the conditions of a permit issued by the appropriate
federal, state or local governmental authorities; shall furnish to Lender
promptly and in any event within thirty (30) days after receipt thereof a
copy of any notice, summons, lien, citation, directive, letter or other
communication from any governmental agency or instrumentality concerning
any intentional or unintentional action or omission on Borrower's part in
connection with any environmental activity whether or not there is damage
to the environment and/or other natural resources.
Additional Assurances. Make, execute and deliver to Lender such promissory
notes, mortgages, deeds of trust, security agreements, assignments,
financing statements, instruments, documents and other agreements as Lender
or its attorneys may reasonably request to evidence and secure the Loans
and to perfect all Security Interests.
XXXXXX'S EXPENDITURES. If any action or proceeding is commenced that would
materially affect Xxxxxx's interest in the Collateral or if Borrower fails
to comply with any provision of this Agreement or any Related Documents,
including but not limited to Borrower's failure to discharge or pay when
due any amounts Borrower is required to discharge or pay under this
Agreement or any Related Documents, Lender on Borrower's behalf may (but
shall not be obligated to) take any action that Lender deems appropriate,
including but not limited to discharging or paying all taxes, liens,
security interests, encumbrances and other claims, at any time levied or
placed on any Collateral and paying all costs for insuring, maintaining
and preserving any Collateral. All such expenditures incurred or paid by
Lender for such purposes will then bear interest at the rate charged under
the Note from the date incurred or paid by Lender to the date of repayment
by Xxxxxxxx. All such expenses will become
BUSINESS LOAN AGREEMENT (ASSET BASED)
Loan No: 200725801 (Continued) Page 4
a part of the Indebtedness and, at Xxxxxx's option, will (A) be payable on
demand; (B) be added to the balance of the Note and be apportioned among
and be payable with any installment payments to become due during either
(1) the term of any applicable insurance policy; or (2) the remaining term
of the Note; or (C) be treated as a balloon payment which will be clue and
payable at the Note's maturity.
NEGATIVE COVENANTS. Borrower covenants and agrees with Lender that while
this Agreement is in effect, Borrower shall not, without the prior written
consent of Lender:
Capital Expenditures. Make or contract to make capital expenditures,
including leasehold improvements, in any fiscal year in excess of
$50,000.00 or incur liability for rentals of property (including both
real and personal property) in an amount which, together with capital
expenditures, shall in any fiscal year exceed such sum.
Indebtedness and Liens. (1) Except for trade debt incurred in the normal
course of business and indebtedness to Lender contemplated by this
Agreement, create, incur or assume indebtedness for borrowed money,
including capital leases, (2) sell, transfer, mortgage, assign, pledge,
lease, grant a security interest in, or encumber any of Borrower's assets
(except as allowed as Permitted Liens), or (3) sell with recourse any of
Borrower's accounts, except to Xxxxxx.
Continuity of Operations. (1) Engage in any business activities
substantially different than those in which Borrower is presently engaged,
(2) cease operations, liquidate, merge, transfer, acquire or consolidate
with any other entity, change its name, dissolve or transfer or sell
Collateral out of the ordinary course of business, or (3) pay any dividends
on Borrower's stock (other than dividends payable in its stock), provided,
however that notwithstanding the foregoing, but only so long as no Event of
Default has occurred and is continuing or would result from the payment of
dividends, if Borrower is a "Subchapter S Corporation" (as defined in the
Internal Revenue Code of 1986, as amended), Borrower may pay cash dividends
on its stock to its shareholders from time to time in amounts necessary to
enable the shareholders to pay income taxes and make estimated income tax
payments to satisfy their liabilities under federal and state law which
arise solely from their status as Shareholders of a Subchapter S
Corporation because of their ownership of shares of Borrower's stock, or
purchase or retire any of Borrower's outstanding shares or alter or amend
Borrower's capital structure.
Loans, Acquisitions and Guaranties. (1) Loan, invest in or advance money
or assets to any other person, enterprise or entity, (2) purchase, create
or acquire any interest in any other enterprise or entity, or (3) incur any
obligation as surety or guarantor other than in the ordinary course of
business.
Agreements. Borrower will not enter into any agreement containing any
provisions which would be violated or breached by the performance of
Borrower's obligations under this Agreement or in connection herewith.
CESSATION OF ADVANCES. If Lender has made any commitment to make any Loan
to Borrower, whether under this Agreement or under any other agreement,
Lender shall have no obligation to make Loan Advances or to disburse Loan
proceeds if: (A) Borrower or any Guarantor is in default under the terms of
this Agreement or any of the Related Documents or any other agreement that
Borrower or any Guarantor has with Lender; (B) Borrower or any Guarantor
dies, becomes incompetent or becomes insolvent, files a petition in
bankruptcy or similar proceedings, or is adjudged a bankrupt; (C) there
occurs a material adverse change in Borrower's financial condition, in the
financial condition of any Guarantor, or in the value of any Collateral
securing any Loan; or (D) any Guarantor seeks, claims or otherwise attempts
to limit, modify or revoke such Guarantor's guaranty of the Loan or any
other loan with Lender; or (E) Lender in good xxxxx xxxxx itself insecure,
even though no Event of Default shall have occurred.
RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves
a right of setoff in all Borrower's accounts with Lender (whether checking,
savings, or some other account). This includes all accounts Borrower holds
jointly with someone else and all accounts Borrower may open in the future.
However, this does not include any IRA or Xxxxx accounts, or any trust
accounts for which setoff would be prohibited by law. Xxxxxxxx authorizes
Xxxxxx, to the extent permitted by applicable law, to charge or setoff all
sums owing on the Indebtedness against any and all such accounts, and, at
Xxxxxx's option, to administratively freeze all such accounts to allow
Lender to protect Xxxxxx's charge and setoffrights provided in this
paragraph.
DEFAULT. Each of the following shall constitute an Event of Default under
this Agreement:
Payment Default. Xxxxxxxx fails to make any payment when due under the Loan.
Other Defaults. Borrower fails to comply with or to perform any other term,
obligation, covenant or condition contained in this Agreement or in any of
the Related Documents or to comply with or to perform any term, obligation,
covenant or condition contained in any other agreement between Lender and
Borrower.
Default in Favor of Third Parties. Borrower or any Grantor defaults under
any loan, extension of credit, security agreement, purchase or sales
agreement, or any other agreement, in favor of any other creditor or
person that may materially affect any of Borrower's or any Grantor's
property or Borrower's or any Grantor's ability to repay the Loans or
perform their respective obligations under this Agreement or any of the
Related Documents.
False Statements. Any warranty, representation or statement made or
furnished to Lender by Borrower or on Borrower's behalf under this
Agreement or the Related Documents is false or misleading in any material
respect, either now or at the time made or furnished or becomes false or
misleading at any time thereafter.
Insolvency. The dissolution or termination of Xxxxxxxx's existence as a
going business, the insolvency of Xxxxxxxx, the appointment of a receiver
for any part of Xxxxxxxx's property, any assignment for the benefit of
creditors, any type of creditor workout, or the commencement of any
proceeding under any bankruptcy or insolvency laws by or against Borrower.
Defective Collateralization. This Agreement or any of the Related Documents
ceases to be in full force and effect (including failure of any collateral
document to create a valid and perfected security interest or lien) at any
time and for any reason.
Creditor or Forfeiture Proceedings. Commencement of foreclosure or
forfeiture proceedings, whether by judicial proceeding, self-help,
repossession or any other method, by any creditor of Borrower or by any
governmental agency against any collateral securing the Loan. This includes
a garnishment of any of Xxxxxxxx's accounts, including deposit accounts,
with Lender. However, this Event of Default shall not apply if there is a
good faith dispute by Xxxxxxxx as to the validity or reasonableness of the
claim which is the basis of the creditor or forfeiture proceeding and if
Borrower gives Xxxxxx written notice of the creditor or forfeiture
proceeding and deposits with Lender monies or a surety bond for the
creditor or forfeiture proceeding, in an amount determined by Lender, in its
sole discretion, as being an adequate reserve or bond for the dispute.
Events Affecting Guarantor. Any of the preceding events occurs with respect
to any Guarantor of any of the Indebtedness or any Guarantor dies or becomes
incompetent, or revokes or disputes the validity of, or liability under,
any Guaranty of the Indebtedness. In the event of a death, Lender, at its
option, may, but shall not be required to, permit the Guarantor's estate to
assume unconditionally the obligations arising under the guaranty in a
manner satisfactory to Lender, and, in doing so, cure any Event of Default.
Change in Ownership. Any change in ownership of twenty-five percent (25%)
or more of the common stock of Borrower.
Adverse Change. A material adverse change occurs in Borrower's financial
condition, or Xxxxxx believes the prospect of payment or performance of
the Loan is impaired.
Insecurity. Lender in good faith believes itself insecure.
Right to Cure. If any default, other than a default on Indebtedness, is
curable and if Borrower or Grantor, as the case may be, has not been given
a notice of a similar default within the preceding twelve (12) months, it
may be cured if Borrower or Grantor, as the case may be, after receiving
written notice from Lender demanding cure of such default: (1) cure the
default within fifteen (15) days; or (2) if the cure requires more than
fifteen (15) days, immediately initiate steps which Xxxxxx deems in
Xxxxxx's sole discretion to be sufficient to cure the default and
thereafter continue and complete all reasonable and necessary steps
sufficient to produce compliance as soon as reasonably practical.
EFFECT OF AN EVENT OF DEFAULT. If any Event of Default shall occur,
except where otherwise provided in this Agreement or the Related Documents,
all commitments and obligations of Lender under this Agreement or the
Related Documents or any other agreement immediately will terminate
(including any obligation to make further Loan Advances or disbursements),
and, at Lender's option, all Indebtedness immediately will become due and
payable, all without notice of any kind to Borrower, except that in the
case of an Event of Default of the type described in the "Insolvency"
subsection above, such acceleration shall be automatic and not optional.
In addition, Lender shall have all the rights and remedies provided in
the Related Documents or available at law, in equity, or otherwise.
Except as may be prohibited by applicable law, all of Lender's rights and
remedies shall be cumulative and may be exercised singularly or
concurrently. Election by Xxxxxx to pursue any remedy shall not exclude
pursuit of any other remedy, and an election to make expenditures or to
take action to perform an obligation of Borrower or of any Grantor shall
not affect Xxxxxx's right to declare a default and to exercise its rights
and remedies.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a
part of this Agreement:
Amendments, This Agreement, together with any Related Documents,
constitutes the entire understanding and agreement of the parties as to
the matters set forth in this Agreement. No alteration of or amendment to
this Agreement shall be effective unless given in writing
BUSINESS LOAN AGREEMENT (ASSET BASED)
Loan No: 200725801 (Continued) Page 5
and signed by the party or parties sought to be charged or bound by the
alteration or amendment.
Attorneys' Fees; Expenses. Xxxxxxxx agrees to pay upon demand all of
Xxxxxx's costs and expenses, including Xxxxxx's reasoilabie attorneys' fees
and Xxxxxx's legal expenses, incurred in connection with the enforcement of
this Agreement. Lender may hire or pay someone else to help enforce this
Agreement, and Borrower shall pay the costs and expenses of such enforcement.
Costs and expenses include Xxxxxx's reasonable attorneys' fees and legal
expenses whether or not there is a lawsuit, including reasonable attorneys'
fees and legal expenses for bankruptcy proceedings (including efforts to
modify or vacate any automatic stay or injunction-, appeals, and any
anticipated post-judgment collection services. Borrower also shall pay all
court costs and such additional fees as may be directed by the court.
Caption Headings. Caption headings in this Agreement are for convenience
purposes only and are not to be used to interpret or define the provisions
of this Agreement.
Consent to Loan Participation. Xxxxxxxx agrees and consents to Xxxxxx's sale
or transfer, whether now or later, of one or more participation interests
in the Loan to one or more purchasers, whether related or unrelated to
Lender. Lender may provide, without any limitation whatsoever, to any one
or more purchasers, or potential purchasers, any information or knowledge
Lender may have about Borrower or about any other matter relating to the
Loan, and Borrower hereby waives any rights to privacy Borrower may have
with respect to such matters. Borrower additionally waives any and all
notices of sale of participation interests, as well as all notices of any
repurchase of such participation interests. Xxxxxxxx also agrees that the
purchasers of any such participation interests will be considered as the
absolute owners of such interests in the Loan and will have all the
rights granted under the participation agreement or agreements governing
the sale of such participation interests. Borrower further waives all
rights of offset or counterclaim that it may have now or later against
Lender or against any purchaser of such a participation interest and
unconditionally agrees that either Lender or such purchaser may enforce
Xxxxxxxx's obligation under the Loan irrespective of the failure or
insolvency of any holder of any interest in the Loan. Xxxxxxxx further
agrees that the purchaser of any such participation interests may enforce
its interests irrespective of any personal claims or defenses that Borrower
may have against Xxxxxx.
Governing Law. This Agreement will be governed by federal law applicable
to Lender and, to the extent not preempted by federal law, the laws of the
State of Minnesota without regard to its conflicts of law provisions. This
Agreement has been accepted by Xxxxxx in the State of Minnesota.
Choice of Venue. If there is a lawsuit, Xxxxxxxx agrees upon Xxxxxx's
request to submit to the jurisdiction of the courts of Hennepin County,
State of Minnesota.
No Waiver by Xxxxxx. Lender shall not be deemed to have waived any rights
under this Agreement unless such waiver is given in writing and signed by
Xxxxxx. No delay or omission on the part of Lender in exercising any right
shall operate as a waiver of such right or any other right. A waiver by
Xxxxxx of a provision of this Agreement shall not prejudice or constitute
a waiver of Lender's right otherwise to demand strict compliance with that
provision or any other provision of this Agreement. No prior waiver by
Xxxxxx, nor any course of dealing between Xxxxxx and Borrower, or between
Lender and any Grantor, shall constitute a waiver of any of Lender's
rights or of any of Borrower's or any Grantor's obligations as to any
future transactions. Whenever the consent of Lender is required under
this Agreement, the granting of such consent by Lender in any instance
shall not constitute continuing consent to subsequent instances where
such consent is required and in all cases such consent may be granted or
withheld in the sole discretion of Lender.
Notices. Any notice required to be given under this Agreement shall be
given in writing, and shall be effective when actually delivered, when
actually received by telefacsimile (unless otherwise required by law),
when deposited with a nationally recognized overnight courier, or, if
mailed, when deposited in the United States mail, as first class, certified
or registered mail postage prepaid, directed to the addresses shown near
the beginning of this Agreement. Any party may change its address for
notices under this Agreement by giving formal written notice to the other
parties, specifying that the purpose of the notice is to change the party's
address. For notice purposes, Xxxxxxxx agrees to keep Xxxxxx informed at
all times of Xxxxxxxx's current address, Unless otherwise provided or
required by law, if there is more than one Borrower, any notice given by
Lender to any Borrower is deemed to be notice given to all Borrowers.
Severability. If a court of competent jurisdiction finds any provision of
this Agreement to be illegal, invalid, or unenforceable as to any
circumstance, that finding shall not make the offending provision illegal,
invalid, or unenforceable as to any other circumstance. If feasible, the
offending provision shall be considered modified so that it becomes legal,
valid and enforceable. If the offending provision cannot be so modified,
it shall be considered deleted from this Agreement. Unless otherwise
required by law, the illegality, invalidity, or unenforceability of any
provision of this Agreement shall not affect the legality, validity or
enforceability of any other provision of this Agreement.
Subsidiaries and Affiliates of Borrower. To the extent the context of any
provisions of this Agreement makes it appropriate, including without
limitation any representation, warranty or covenant, the word "Borrower"
as used in this Agreement shall include all of Borrower's subsidiaries
and affiliates. Notwithstanding the foregoing however, under no
circumstances shall this Agreement be construed to require Lender to make
any Loan or other financial accommodation to any of Borrower's subsidiaries
or affiliates.
Successors and Assigns. All covenants and agreements by or on behalf of
Borrower contained in this Agreement or any Related Documents shall bind
Xxxxxxxx's successors and assigns and shall inure to the benefit of Lender
and its successors and assigns. Borrower shall not, however, have the right
to assign Xxxxxxxx's rights under this Agreement or any interest therein,
without the prior written consent of Lender.
Survival of Representations and Warranties. Xxxxxxxx understands and
agrees that in extending Loan Advances, Xxxxxx is relying on all
representations, warranties, and covenants made by Borrower in this
Agreement or in any certificate or other instrument delivered by Borrower
to Lender under this Agreement or the Related Documents. Borrower further
agrees that regardless of any investigation made by Xxxxxx, all such
representations, warranties and covenants will survive the extension of
Loan Advances and delivery to Lender of the Related Documents, shall be
continuing in nature, shall be deemed made and redated by Xxxxxxxx at the
time each Loan Advance is made, and shall remain in full force and effect
until such time as Borrower's Indebtedness shall be paid in full, or until
this Agreement shall be terminated in the manner provided above, whichever
is the last to occur.
Time is of the Essence. Time is of the essence in the performance of this
Agreement.
Waive Jury. All parties to this Agreement hereby waive the right to any
jury trial in any action, proceeding, or counterclaim brought by any party
against any other party.
DEFINITIONS. The following capitalized words and terms shall have the
following meanings when used in this Agreement. Unless specifically stated
to the contrary, all references to dollar amounts shall mean amounts in
lawful money of the United States of America. Words and terms used in the
singular shall include the plural, and the plural shall include the
singular, as the context may require. Words and terms not otherwise
defined in this Agreement shall have the meanings attributed to such
terms in the Uniform Commercial Code. Accounting words and terms not
otherwise defined in this Agreement shall have the meanings assigned
to them in accordance with generally accepted accounting principles as in
effect on the date of this Agreement:
Account. The word "Account" means a trade account, account receivable,
other receivable, or other right to payment for goods sold or services
rendered owing to Borrower (or to a third party grantor acceptable to
Lender).
Account Debtor. The words "Account Debtor" mean the person or entity
obligated upon an Account.
Advance. The word "Advance" means a disbursement of Loan funds made, or
to be made, to Borrower or on Borrower's behalf under the terms and
conditions of this Agreement.
Agreement. The word "Agreement" means this Business Loan Agreement
(Asset Based), as this Business Loan Agreement (Asset Based) may be amended
or modified from time to time, together with all exhibits and schedules
attached to this Business Loan Agreement (Asset Based) from time to time.
Borrower. The word "Borrower" means Xxxxxx XX, Inc. and includes ail
co-signers and co-makers signing the Note and all their successors and
assigns.
Borrowing Base. The words "Borrowing Base" mean, as determined by Lender
from time to time, the lesser of (1) $1,000,000.00 or (2) 75.000% of the
aggregate amount of Eligible Accounts (not to exceed in corresponding Loan
amount based on Eligible Accounts $1,000,000.00).
Business Day. The words "Business Day" mean a day on which commercial
banks are open in the State of Minnesota.
Collateral. The word "Collateral" means all property and assets granted as
collateral security for a Loan, whether real or personal property, whether
granted directly or indirectly, whether granted now or in the future, and
whether granted in the form of a security interest, mortgage, collateral
mortgage, deed of trust, assignment, pledge, crop pledge, chattel mortgage,
collateral chattel mortgage, chattel trust, factor's lien, equipment trust,
conditional sale, trust receipt, lien, charge, lien or title retention
contract, lease or consignment intended as asecurity device, or any other
security or lien interest whatsoever, whether created by law, contract, or
otherwise. The word Collateral also includes without limitation all
collateral described in the Collateral section of this Agreement.
BUSINESS LOAN AGREEMENT (ASSET BASED)
oan No: 200725801 (Continued) Page 6
Eligible Accounts. The words "Eligible Accounts" mean at any time, all of
Borrower's Accounts which contain selling terms and conditions acceptable
to Lender. The net amount of any Eligible Account against which Borrower
may borrow shall exclude all returns, discounts, credits, and offsets of
any nature. Unless otherwise agreed to by Xxxxxx in writing, Eligible
Accounts do not include:
(1) Accounts with respect to which the Account Debtor is employee or agent
of Xxxxxxxx.
(2) Accounts with respect to which the Account Debtor is a subsidiary of,
or affiliated with Borrower or its shareholders, officers, or
directors.
(3) Accounts with respect to which goods are placed on consignment,
guaranteed sale, or other terms by reason of which the payment by the
Account Debtor may be conditional.
(4) Accounts with respect to which Borrower is or may become liable to the
Account Debtor for goods sold or services rendered by the Account Debtor
to Borrower.
(5) Accounts which are subject to dispute, counterclaim, or setoff.
(6) Accounts with respect to which the goods have not been shipped or
delivered, or the services have not been rendered, to the Account Debtor.
(7) Accounts with respect to which Lender, in its sole discretion, deems
the creditworthiness or financial condition of the Account Debtor to be
unsatisfactory.
(8) Accounts of any Account Debtor who has filed or has had filed against
it a petition in bankruptcy or an application for relief under any
provision of any state or federal bankruptcy, insolvency, or
debtor-in-relief acts; or who has had appointed a trustee, custodian, or
receiver for the assets of such Account Debtor; or who has made an
assignment for the benefit of creditors or has become insolvent or fails
generally to pay its debts (including its payrolls) as such debts become
due.
Environmental Laws. The words "Environmental Laws" mean any and all state,
federal and local statutes, regulations and ordinances relating to the
protection of human health or the environment, including without limitation
the Comprehensive Environmental Response, Compensation, and Liability Act
of 1980, as amended, 42 U.S.C. Section 9601, et seq. ("CERCLA"), the
Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499
("XXXX"), the Hazardous Materials Transportation Act, 49 U.S.C. Section
1801, et seq., the Resource Conservation and Recovery Act, 42 U.S.C.
Section 6901, et seq., or other applicable state or federal laws, rules,
or regulations adopted pursuant thereto or common law, and shall also
include pollutants, contaminants, polychlorinated biphenyls, asbestos,
urea formaldehyde, petroleum and petroleum products, and agricultural
chemicals.
Event of Default. The words "Event of Default" mean any of the events of
default set forth in this Agreement in the default section of this
Agreement.
Expiration Date. The words "Expiration Date" mean the date of termination
of Xxxxxx's commitment to lend under this Agreement.
GAAP. The word "GAAP" means generally accepted accounting principles.
Grantor. The word "Grantor" means each and all of the persons or entities
granting a Security Interest in any Collateral for the Loan, including
without limitation all Borrowers granting such a Security Interest.
Guarantor. The word "Guarantor" means any guarantor, surety, or
accommodation party of any or all of the Loan.
Guaranty. The word "Guaranty" means the guaranty from Guarantor to Lender,
including without limitation a guaranty of all or part of the Note.
Hazardous Substances. The words "Hazardous Substances" mean materials that,
because of their quantity, concentration or physical, chemical or
infectious characteristics, may cause or pose a present or potential hazard
to human health or the environment when improperly used, treated, stored,
disposed of, generated, manufactured, transported or otherwise handled.
The words "Hazardous Substances" are used in their very broadest sense
and include without limitation any and all hazardous or toxic substances,
materials or waste as defined by or listed under the Environmental Laws.
The term "Hazardous Substances" also includes, without limitation,
petroleum and petroleum by-products or any fraction thereof and asbestos.
Indebtedness. The word "Indebtedness" means the indebtedness evidenced by
the Note or Related Documents, including all principal and interest
together with all other indebtedness and costs and expenses for which
Borrower is responsible under this Agreement or under any of the Related
Documents.
Lender. The word "Lender" means Signature Bank, its successors and assigns.
Loan. The word "Loan" means any and all loans and financial accommodations
from Lender to Borrower whether now or hereafter existing, and however
evidenced, including without limitation those loans and financial
accommodations described herein or described on any exhibit or schedule
attached to this Agreement from time to time.
Note. The word "Note" means the Note executed by Xxxxxx XX, Inc. in the
principal amount of $1,000,000.00 dated May 22, 2008, together with all
renewals of, extensions of, modifications of, refinancings of,
consolidations of, and substitutions for the note or credit agreement.
Permitted Liens. The words "Permitted Liens" mean (1) liens and security
interests securing Indebtedness owed by Borrower to Lender; (2) liens for
taxes, assessments, or similar charges either not yet due or being
contested in good faith; (3) liens of materialmen, mechanics, warehousemen,
or carriers, or other like liens arising in the ordinary course of business
and securing obligations which are not yet delinquent; (4) purchase money
liens or purchase money security interests upon or in any property acquired
or held by Borrower in the ordinary course of business to secure
indebtedness outstanding on the date of this Agreement or permitted to be
incurred under the paragraph of this Agreement titled "Indebtedness and
Liens"; (5) liens and security interests which, as of the date of this
Agreement, have been disclosed to and approved by the Lender in writing;
and (6) those liens and security interests which in the aggregate constitute
an immaterial and insignificant monetary amount with respect to the net
value of Xxxxxxxx's assets.
Primary Credit Facility. The words "Primary Credit Facility" mean the credit
facility described in the Line of Credit section of this Agreement.
Related Documents. The words "Related Documents" mean all promissory notes,
credit agreements, loan agreements, environmental agreements, guaranties,
security agreements, mortgages, deeds of trust, security deeds, collateral
mortgages, and all other instruments, agreements and documents, whether now
or hereafter existing, executed in connection with the Xxxx.Xxxxxxxx
Agreement. The words "Security Agreement" mean and include without
limitation any agreements, promises, covenants, arrangements, understandings
or other agreements, whether created by law, contract, or otherwise,
evidencing, governing, representing, or creating a Security Interest.
Security Interest. The words "Security Interest" mean, without limitation,
any and all types of collateral security, present and future, whether in
the form of a lien, charge, encumbrance, mortgage, deed of trust, security
deed, assignment, pledge, crop pledge, chattel mortgage, collateral
chattel mortgage, chattel trust, factor's lien, equipment trust, conditional
sale, trust receipt, lien or title retentioncontract, lease or consignment
intended as a security device, or any other security or lien interest
whatsoever whether created by law, contract, or otherwise.
Tangible Net Worth. The words "Tangible Net Worth" mean Borrower's total
assets excluding all intangible assets (i.e., goodwill, trademarks, patents,
copyrights, organizational expenses, and similar intangible items, but
including leaseholds and leasehold improvements) less total debt.
BUSINESS LOAN AGREEMENT (ASSET BASED)
Loan No: 200725801 (Continued) Page 7
XXXXXXXX ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN
AGREEMENT (ASSET BASED) AND XXXXXXXX AGREES TO ITS TERMS. THIS BUSINESS
LOAN AGREEMENT (ASSET BASED) IS DATED MAY 22, 2008.
BORROWER:
XXXXXX XX, INC.
By: /s/ XX Xxxxxx
Xxxxxx X. Xxxxxx, CEO of Xxxxxx XX, Inc
By: /s/ Xxxxxx X Xxxxxx
Xxxxxx X Xxxxxx, Vice President of Xxxxxx XX, Inc.
LENDER:
SIGNATURE BANK
By: /s/
Authorized Signer
