BUSINESS LOAN AGREEMENT
Principal Loan Date Maturity Loan No Call / Coll Account Officer Initials
1,500,000.00 03-20-2007 04-01-2010 8613586980 98 135869 601
References in the shaded area are for Lender'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: Baywood International, Inc. Lender: Vineyard Bank, N.A.
Baywood Acquisition, Inc. Anaheim Business Banking
00000 Xxxxx 00xx Xxxxx 000 Xxxxx Xxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000 Xxxxxxxxx, Xxxxx 000
Xxxxxx, XX 00000
THIS BUSINESS LOAN AGREEMENT dated March 20, 2007, is made and executed between
Baywood International, Inc.; and Baywood Acquisition, Inc. ("Borrower") and
Vineyard Bank, N.A. ("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 March 20, 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.
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) subordinations; (6) together with all such
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.
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.
MULTIPLE BORROWERS. This Agreement has been executed by multiple obligors who
are referred to in this Agreement individually, collectively and interchangeably
as "Borrower." Unless specifically stated to the contrary, the word "Borrower"
as used in this Agreement, including without limitation all representations,
warranties and covenants, shall include all Borrowers. Borrower understands and
agrees that, with or without notice to any one Borrower, Lender may (A) make
one or more additional secured or unsecured loans or otherwise extend additional
credit with respect to any other Borrower; (B) with respect to any other
Borrower alter, compromise, renew, extend, accelerate, or otherwise change one
or more times the time for payment or other terms of any indebtedness, including
increases and decreases of the rate of interest on the indebtedness; (C)
exchange, enforce, waive, subordinate, fail or decide not to perfect, and
release any security, with or without the substitution of new collateral; (D)
release, substitute, agree not to sue, or deal with any one or more of
Borrower's or any other Borrower's sureties, endorsers, or other guarantors on
any terms or in any manner Lender may choose; (E) determine how, when and what
application of payments and credits shall be made on any indebtedness; (F)
apply such security and direct the order or manner of sale of any Collateral,
including without limitation, any non-judicial sale permitted by the terms of
the controlling security agreement or deed of trust, as Lender in its discretion
may determine; (G) sell, transfer, assign or grant participations in all or
any part of the Loan; (H) exercise or refrain from exercising any rights
against Borrower or others, or otherwise act or refrain from acting; (I)
settle or compromise any indebtedness; and (J) subordinate the payment of all
or any part of any of Borrower's indebtedness to Lender to the payment of any
liabilities which may be due Lender or others.
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. Baywood International, Inc. 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 Nevada.
Baywood International, Inc. is duly authorized to transact business in all
other states in which Baywood International, Inc. is doing business, having
obtained all necessary filings, governmental licenses and approvals for
each state in which Baywood International, Inc. is doing business.
Specifically, Baywood International, Inc. 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. Baywood International, Inc. 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. Baywood International,
Inc. maintains an office at 00000 Xxxxx 00xx Xxxxx, Xxxxxxxxxx, XX 00000.
Unless Baywood International, Inc. has designated otherwise in writing, the
principal office is the office at which Baywood International, Inc. keeps
its books and records including its records concerning the Collateral.
Baywood International, Inc. will notify Lender prior to any change in the
location of Baywood
International, Inc.'s state of organization or any change in Baywood
International, Inc.'s name. Baywood International, Inc. 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 Baywood International,
Inc. and Baywood International, Inc.'s business activities.
Baywood Acquisition, Inc. 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 Nevada. Baywood
Acquisition, Inc. is duly authorized to transact business in all other
states in which Baywood Acquisition, Inc. is doing business, having
obtained all necessary filings, governmental licenses and approvals for
each state in which Baywood Acquisition, Inc. is doing business.
Specifically, Baywood Acquisition, Inc. 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. Baywood Acquisition, Inc. 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. Baywood Acquisition, Inc.
maintains an office at 00000 Xxxxx 00xx Xxxxx, Xxxxxxxxxx, XX 00000. Unless
Baywood Acquisition, Inc. has designated otherwise in writing, the
principal office is the office at which Baywood Acquisition, Inc. keeps its
books and records including its records concerning the Collateral. Baywood
Acquisition, Inc. will notify Lender prior to any change in the location of
Baywood Acquisition, Inc.'s state of organization or any change in Baywood
Acquisition, Inc.'s name. Baywood Acquisition, Inc. 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 Baywood Acquisition,
Inc. and Baywood Acquisition, Inc.'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, 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 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 ninety (90) 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.
INTERIM STATEMENTS. As soon as available, but in no event later
than thirty (30) days after the end of each fiscal quarter, Xxxxxxxx's
balance sheet and profit and loss statement for the period ended,
compiled by a certified public accountant satisfactory to Lender.
TAX RETURNS. As soon as available, but in no event later than
thirty (30) days after the applicable filing date for the tax
reporting period ended, Federal and other governmental tax returns,
prepared by a tax professional satisfactory to Lender.
ADDITIONAL REQUIREMENTS.
ACCOUNTS RECEIVABLE AGING AND ACCOUNTS PAYABLE AGING. As soon as
available, but in no event later than thirty (30) days after the end
of each quarter, Borrowers shall deliver to Lender a detailed aging,
by total and by customer, of Borrower's Accounts of which shall be set
forth in a form and shall contain such information as is acceptable to
Lender.
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:
DEBT SERVICE COVERAGE RATIO. Maintain a ratio of Debt
Service Coverage in excess of 1.200 TO 1.000. The term "Debt
Service Coverage Ratio" means Borrower's Earnings/Income before
Interest, Taxes, Depreciation and Amortization (EBITDA) divided
by Xxxxxxxx's Current Portion of Long Term Indebtedness. This
coverage ratio will be evaluated as of Semi-Annually.
OTHER REQUIREMENTS.
TANGIBLE NET WORTH REQUIREMENTS. Maintain a minimum Tangible Net
Worth of not less than $5,500,000.00. Tangible Net Worth Requirements
are based on tangible net worth plus subordinated debt.
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.
SUBORDINATION. Prior to disbursement of any Loan proceeds, deliver to
Lender subordination agreements on Xxxxxx's forms, executed by Xxxxxxxx's
creditors named below, subordinating all of Borrower's indebtedness to such
creditors, or such lesser amounts as may be agreed to by Xxxxxx in writing,
and any security interests in collateral securing that indebtedness to the
Loans and security interests of Lender.
NAME OF CREDITOR TOTAL AMOUNT OF DEBT
----------------- ---------------------
JSH PARTNERS $ 2,000,000.00
XXX XXXXXXXXX $ 350,000.00
XXX XXXXXXXXX $ 100,000.00
XXXXXXX XXX $ 175,000.00
XXXXXXX XXX $ 250,000.00
X. XXXXXX XXXXX $ 175,000.00
X. XXXXXX XXXXX $ 250,000.00
XXXX XXXXX $ 500,000.00
X. XXX XXXXX, III $ 500,000.00
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. Borrower may withhold any such payment or may elect to
contest any lien if Borrower is in good faith conducting an appropriate
proceeding to contest the obligation to pay.
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 in all material
respects 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 at least annually, with a certificate executed by Xxxxxxxx's chief
financial officer, or other officer or person acceptable to Lender,
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
material 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 Lender's interest in the Collateral or if Borrower fails to
comply with any provision of this Agreement or any Related Documents after any
period of notice and opportunity to cure set forth herein, 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
Lender'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 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 (a) Borrower may pay regularly scheduled dividends on its Series
I Cumulative Convertible Preferred Stock, and (b) 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.
DEFAULT. Each of the following shall constitute an Event of Default under this
Agreement:
PAYMENT DEFAULT. Should Borrower fail to make any payment when due
under this Note within 10 days of each payment date.
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
after any period of notice and opportunity to cure provided for therein.
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
and in the case of any proceeding against Borrower, or the appointment of a
receiver not consented to by Xxxxxxxx, such proceeding or appointment shall
not be dismissed within 60 days.
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, calculated on a
fully-diluted basis.
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.
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 Lender deems in
Lender'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 and signed by the
party or parties sought to be charged or bound by the alteration or
amendment.
ARBITRATION. XXXXXX AND XXXXXXXX AGREE THAT ALL DISPUTES, CLAIMS AND
CONTROVERSIES BETWEEN THEM WHETHER INDIVIDUAL, JOINT, OR CLASS IN NATURE,
ARISING FROM THIS AGREEMENT OR OTHERWISE, INCLUDING WITHOUT LIMITATION
CONTRACT AND TORT DISPUTES, SHALL BE ARBITRATED PURSUANT TO THE FINANCIAL
SERVICES RULES OF ENDISPUTE, INC., D/B/A J.A.M.S./ENDISPUTE OR ITS
SUCCESSOR IN EFFECT AT THE TIME THE CLAIM IS FILED, UPON REQUEST OF EITHER
PARTY. NO ACT TO TAKE OR DISPOSE OF ANY COLLATERAL SHALL CONSTITUTE A
WAIVER OF THIS ARBITRATION AGREEMENT OR BE PROHIBITED BY THIS ARBITRATION
AGREEMENT. THIS INCLUDES, WITHOUT LIMITATION, OBTAINING INJUNCTIVE RELIEF
OR A TEMPORARY RESTRAINING ORDER; INVOKING A POWER OF SALE UNDER ANY DEED
OF TRUST OR MORTGAGE; OBTAINING A WRIT OF ATTACHMENT OR IMPOSITION OF A
RECEIVER; OR EXERCISING ANY RIGHTS RELATING TO PERSONAL PROPERTY, INCLUDING
TAKING OR DISPOSING OF SUCH PROPERTY WITH OR WITHOUT JUDICIAL PROCESS
PURSUANT ARTICLE 9 OF THE UNIFORM COMMERCIAL CODE. ANY DISPUTES, CLAIMS, OR
CONTROVERSIES CONCERNING THE LAWFULNESS OR REASONABLENESS OF ANY ACT, OR
EXERCISE OF ANY RIGHT, CONCERNING ANY COLLATERAL, INCLUDING ANY CLAIM TO
RESCIND, REFORM, OR OTHERWISE MODIFY ANY AGREEMENT RELATING TO THE
COLLATERAL, SHALL ALSO BE ARBITRATED, PROVIDED HOWEVER THAT NO ARBITRATOR
SHALL HAVE THE RIGHT OR THE POWER TO ENJOIN OR RESTRAIN ANY ACT OF ANY
PARTY. XXXXXXXX AND XXXXXX AGREE THAT IN THE EVENT OF AN ACTION FOR
JUDICIAL FORECLOSURE PURSUANT TO CALIFORNIA CODE OF CIVIL PROCEDURE SECTION
726, OR ANY SIMILAR PROVISION IN ANY OTHER STATE, THE COMMENCEMENT OF SUCH
AN ACTION WILL NOT CONSTITUTE A WAIVER OF THE RIGHT TO ARBITRATE AND THE
COURT SHALL REFER TO ARBITRATION AS MUCH OF SUCH ACTION, INCLUDING
COUNTERCLAIMS, AS LAWFULLY MAY BE REFERRED TO ARBITRATION. JUDGMENT UPON
ANY AWARD RENDERED BY ANY ARBITRATOR MAY BE ENTERED IN ANY COURT HAVING
JURISDICTION. NOTHING IN THIS AGREEMENT SHALL PRECLUDE ANY PARTY FROM
SEEKING EQUITABLE RELIEF FROM A COURT OF COMPETENT JURISDICTION. THE
STATUTE OF LIMITATIONS, ESTOPPEL, WAIVER, LACHES, AND SIMILAR DOCTRINES
WHICH WOULD OTHERWISE BE APPLICABLE IN AN ACTION BROUGHT BY A PARTY SHALL
BE APPLICABLE IN ANY ARBITRATION PROCEEDING, AND THE COMMENCEMENT OF AN
ARBITRATION PROCEEDING SHALL BE DEEMED THE COMMENCEMENT OF AN ACTION FOR
THESE PURPOSES. THE FEDERAL ARBITRATION ACT SHALL APPLY TO THE
CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT OF THIS ARBITRATION
PROVISION.
ATTORNEYS' FEES; EXPENSES. Xxxxxxxx agrees to pay upon demand all of
Xxxxxx's reasonable costs and expenses, including Xxxxxx's 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 attorneys' fees and legal
expenses whether or not there is a lawsuit, including 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 CALIFORNIA WITHOUT REGARD TO ITS CONFLICTS OF LAW
PROVISIONS. THIS AGREEMENT HAS BEEN ACCEPTED BY XXXXXX IN THE STATE OF
CALIFORNIA.
JOINT AND SEVERAL LIABILITY. All obligations of Borrower under this
Agreement shall be joint and several, and all references to Borrower shall
mean each and every Borrower. This means that each Borrower signing below
is responsible for all obligations in this Agreement. Where any one or more
of the parties is a corporation, partnership, limited liability company or
similar entity, it is not necessary for Lender to inquire into the powers
of any of the officers, directors, partners, members, or other agents
acting or purporting to act on the entity's behalf, and any obligations
made or created in reliance upon the professed exercise of such powers
shall be guaranteed under this Agreement.
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 person
or circumstance, that finding shall not make the offending provision
illegal, invalid, or unenforceable as to any other person or 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 making the Loan, 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. Xxxxxxxx further agrees that regardless
of any investigation made by Xxxxxx, all such representations, warranties
and covenants will survive the making of the Loan and delivery to Lender of
the Related Documents, shall be continuing in nature, and shall remain in
full force and effect until such time as Xxxxxxxx'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.
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 Baywood International, Inc.; and
Baywood Acquisition, Inc. 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., Chapters 6.5 through 7.7 of Division 20 of
the California Health and Safety Code, Section 25100, et seq., or other
applicable state or federal laws, rules, or regulations adopted pursuant
thereto.
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 Vineyard Bank, N.A., 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 Baywood
International, Inc.; and Baywood Acquisition, Inc. in the principal amount
of $1,500,000.00 dated March 20, 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.
XXXXXXXX ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN
AGREEMENT AND XXXXXXXX AGREES TO ITS TERMS. THIS BUSINESS LOAN AGREEMENT IS
DATED MARCH 20, 2007.
BORROWER:
BAYWOOD INTERNATIONAL, INC.
BY: /s/ Xxxx Xxxxxxxxxx
---------------------------------------------
XXXX XXXXXXXXXX, PRESIDENT OF BAYWOOD INTERNATIONAL, INC.
BAYWOOD ACQUISITION, INC.
BY: /s/ Xxxx Xxxxxxxxxx
---------------------------------------------
XXXX XXXXXXXXXX, PRESIDENT OF BAYWOOD ACQUISITION, INC.
LENDER:
VINEYARD BANK, N.A.
BY:
---------------------------------------------
AUTHORIZED SIGNER
