BUSINESS LOAN AGREEMENT
Exhibit
20.21
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Principal
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Loan
Date
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Maturity
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Loan
No
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Call
/ Coll
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Account
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Officer
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Initials
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$2,000,000.00
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10-25-2007
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10-24-2008
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418887
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11
/ 3190
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12003591
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081
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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.
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Any
item above containing "***" has been omitted due to text length
limitations.
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Borrower:
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Aetrium
Incorporated
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Lender:
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Xxxxxx
Bank, National Association
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0000
Xxxxx Xx
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Xxxxxxxxxxx
Office
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North
St.Xxxx, WIN 55109
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0000
Xxxxx Xxxxx Xxxx
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P.O.
Box 1000
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Lake
Elmo, WIN 55042
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THIS
BUSINESS LOAN AGREEMENT dated October 25, 2007, is made and executed between
Aetrium Incorporated ("Borrower") and Xxxxxx Bank, National Association
("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 October 25, 2007, 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 such time as the parties
may agree in writing to terminate this Agreement.
ADVANCE
AUTHORITY. The following person or persons are authorized to
request advances and authorize payments under the line of credit until Xxxxxx
receives from Borrower, at Xxxxxx's address shown above, written notice of
revocation of such authority: Xxxxxx X. Xxxxxxxx,
President/CEO of Aetrium Incorporated; Xxxx X.
Xxxxxxxxx ,
Treasurer/Asst Secretary of Aetrium Incorporated; and Xxxxxxx X. Xxxxx,
XXX/Secretary of Aetrium
Incorporated.
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) together with all such Related Documents as Lender may
require for the Loan; all in form and substance satisfactory to Lender and
Lender'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.
Payment
of Fees and Expenses. Borrower shall have paid to Lender all
fees, charges, and other expenses which are then due and payable as specified
in
this Agreement or any Related Document.
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 Xxxxx Xx, Xxxxx Xx. Xxxx,
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: None.
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, Xxxxxxxx owns and has good title to
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all
of
Xxxxxxxx'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:
Annual
Statements. As soon as available, but in no event
later than one-hundred-twenty (120) days after the end of each fiscal year,
Xxxxxxxx's balance sheet and income statement for the year ended, audited
by a
certified public accountant satisfactory to Lender.
Additional
Requirements. Furnish the Lender with, as soon as available
but in no event later than 120 days after completion, copies of Xxxxxxxx's
10-K
filings.
Furnish
the Lender with, as soon as available but in no event later than 45 days
after
each quarter, copies of Borrower's 10-Q filings.
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. Other Cash
Flow requirements are as follows: Minimum
quarterly net income of $1.00.
Tangible
Net Worth Requirements. Maintain a minimum Tangible
Net Worth of not less
than: $17,000,000.00. In
addition, Borrower shall comply with the following net worth ratio
requirements:
Debt
/ Worth Ratio. Maintain a ratio of Debt / Worth not in
excess of 0.500 to 1.000. The ratio "Debt / Worth" means
Borrower's Total Liabilities
divided by Borrower's Tangible Net Worth. This leverage ratio should be
maintained at all times and may be evaluated at any time.
Other
Requirements. Xxxxxx Bank, National Association has the
option to require a Borrowing Base Certificate at the banks
discretion
Borrower
to maintain all depository accounts with Xxxxxx Bank, National
Association
Tangible
Net Worth. In addition any due from related parties or affiliates other than
wholly owned subsidiaries of the borrower will be considered Intangible Assets
under the definition of Tangible Net Worth per this
Agreement.
Accounts
Receivable. Furnish the Lender with, as soon as
available but in no event later than 45 days after the end of each
fiscal
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quarter,
Xxxxxxxx's aging of Accounts Receivable for the period ended, prepared by
Xxxxxxxx.
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 ten (10) 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.
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.
Compliance
Certificates. Unless waived in writing by Xxxxxx, provide Lender within
forty-five (45) days after the end of each fiscal quarter, with a certificate
executed by Xxxxxxxx's chief financial officer, or other officer or person
acceptable to Xxxxxx, certifying that the representations and warranties
set
forth in this Agreement are true and correct as of the date of the certificate
and further certifying that, as of the date of the certificate, no Event
of
Default exists under this Agreement.
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 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;
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or
(2) the remaining term of the Note;
or (C) be treated as a balloon payment which will be
due 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:
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.
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 setoff rights 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.
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.
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 Xxxxxx'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
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(Continued)
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5
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"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 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 reasonable 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.
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
lender. 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.
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Loan
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(Continued)
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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:
Advance.
The word "Advance" means a disbursement of Loan funds made, or to
be
made, to Borrower or on Borrower's behalf on a line of credit or multiple
advance basis under the terms and conditions of this
Agreement.
Agreement.
The word "Agreement" means this Business Loan Agreement, as this Business
Loan
Agreement may be amended or modified from time to time, together with all
exhibits and schedules attached to this Business Loan Agreement from time
to
time.
Borrower.
The word "Borrower" means Aetrium Incorporated and includes all co-signers
and
co-makers signing the Note and all their successors and
assigns.
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
a security device, or any other security or lien interest whatsoever, whether
created by law, contract, or otherwise.
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.
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 Xxxxxx Bank, National Association, 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 Aetrium Incorporated in the principal
amount of $2,000,000.00 dated October 25, 2007, 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.
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 Loan.
Security
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 retention contract, 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,
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BUSINESS
LOAN AGREEMENT
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Loan
No: 418887
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(Continued)
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trademarks,
patents, copyrights, organizational expenses, and similar intangible items,
but
including leaseholds and leasehold improvements) less total
debt.
XXXXXXXX
ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS
LOAN AGREEMENT AND XXXXXXXX AGREES TO ITS
TERMS. THIS BUSINESS LOAN AGREEMENT IS DATED OCTOBER 25,
2007.
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BORROWER:
|
||||
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AETRIUM
INCORPORATED
|
||||
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By:
|
/s/
Xxxxxx X. Xxxxxxxx
|
By:
|
/s/
Xxxx X. Xxxxxxxxx
|
|
|
Xxxxxx
X. Xxxxxxxx, President/CEO of Aetrium Incorporated
|
Xxxx
X.
Xxxxxxxxx, Treasurer/Asst Secretary of Aetrium
Incorporated
|
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By:
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/s/
Xxxxxxx X. Xxxxx
|
|||
|
Xxxxxxx
X. Xxxxx, XXX/Secretary of Aetrium Incorporated
|
||||
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LENDER:
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||||
|
XXXXXX
BANK, NATIONAL ASSOCIATION
|
||||
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By:
|
/s/
Xxxxx X. Xxxxx, SVP
|
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Authorized
Signer
|
||||
