EXHIBIT (H)(11)
LOAN AGREEMENT
This LOAN AGREEMENT (as amended, restated, supplemented or otherwise
modified from time to time, the "Agreement") is made and entered into as of the
1st day of October, 2004 by and between, Xxxxxxxx Xxxxx Funds, Inc. a
corporation with its address at 1200 Xxxx X. Xxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxxx
00000 (the "Borrower"), and U.S. BANK N.A., with its address at 000 Xxxxxx
Xxxxxx, Xxxxxxxxxx, Xxxx 00000 (the "Bank").
1. (a)Definitions. The following terms shall have the meanings
specified below:
"Act" shall mean the Investment Company Act of 1940, as amended.
"AMEX Securities" shall mean securities issued by an entity
organized in one of the states of the United States or the District of Columbia
which are listed for trading and actively traded on the American Stock Exchange.
"Applicable Law" shall mean and include laws, statutes, ordinances,
and rules and regulations thereunder, and interpretations thereof by any
Governmental Authority charged with the administration or the interpretation
thereof, common law and orders, requests, directives, instructions and notices
of any Governmental Authority having the force of law.
"Authorized Officer" shall have the meaning set forth in Section
6(a)(i)(C).
"Available Facility" shall mean at any time, the lesser of (i)
$20,000,000, (ii) 5% of the Net Assets of the Fund, (iii) 5% of the market value
of the assets of the Fund which are recorded on the Borrower's books and records
as belonging to the Fund, which are held by the Custodian and (iv) 5% of the sum
of the market value of the following assets of the Fund: (A) NYSE Securities,
(B) AMEX Securities, (C) Nasdaq Securities, (D) debt issues of the United States
government or any of its agencies, (E) debt issues with a Xxxxx'x Investors
Service, Inc. rating of no less than BBB, (F) preferred stocks with a Standard &
Poor's Rating Service or Xxxxx'x Investors Service, Inc. rating of A or higher,
in each case which are recorded on the Borrower's books and records as belonging
to the Fund, which are held by the Custodian and (G) other assets of the Fund
which are expressly approved in writing by the Bank in its sole discretion.
"Bank" shall have the meaning set forth in the preamble.
"Borrower" shall have the meaning set forth in the preamble.
"Business Day" shall mean any day excluding Saturday, Sunday and any
day on which banking institutions in the State of Ohio are authorized or
required by law or other government actions to close.
"Custodian" shall mean the Bank, as custodian, pursuant to the
Custody Agreement.
"Custody Agreement" shall mean that certain Custody Agreement dated
February 7, 1992 between the Borrower and the Bank, as it may be amended,
restated, modified or supplemented from time to time.
"Default" shall mean any event, act or condition which with notice
or lapse of time, or both, would constitute an Event of Default.
"Effective Date" shall have the meaning set forth in Section 6(a).
"Event of Default" shall have the meaning set forth in Section 7.
"Fund" shall mean the Series known as the Xxxxxxxx Xxxxx Growth
Fund.
"Fund Statement" shall mean the Borrower's Statement of Additional
Information dated April 1, 2004, as supplemented and amended from time to time,
relating to the Xxxxxxxx Plumb Growth Fund and the other Series of the Borrower.
"GAAP" shall mean generally accepted accounting principles in the
United States consistently applied in accordance with past practices.
"Governmental Authority" shall mean any foreign, federal, state,
regional, local, municipal or other government, or any department, commission,
board, bureau, agency, public authority or instrumentality thereof, or any
court.
"Indebtedness" of any person shall mean all of the obligations of
such person which, in accordance with GAAP, would be included as liabilities on
the balance sheet of such person including, without limitation, (i) any
indebtedness, obligation or liability of any kind or nature whatsoever and (ii)
any guarantee, indemnity, endorsement, suretyship or other contingent obligation
of any kind or nature whatsoever in respect of the obligations of another
person.
"Investment" shall mean, when used with respect to any person, any
direct or indirect purchase or other acquisition by such person of a beneficial
interest in capital stock, bonds, notes, debentures or other securities issued
by any other person or any direct or indirect advance, loan or other extension
of credit or capital contribution by such person to any other person.
"Lien" shall mean any mortgage, pledge, security interest, charge,
hypothecation, collateral assignment, deposit arrangement, encumbrance, lien
(statutory or other), or other security agreement of any kind or nature
whatsoever.
"Loan" and "Loans" shall have the meaning set forth in Section 2(a).
"Loan Documents" shall mean this Agreement, the Note and all other
documents and instruments executed in connection herewith and with the Loans.
"Maturity Date" shall mean November 15, 2004.
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"Nasdaq Securities" shall mean securities issued by an entity
organized in one of the states of the United States or the District of Columbia
which are listed for trading, and actively traded, on the Nasdaq Stock Market.
"Net Assets" shall mean from time to time, the net assets of the
Fund, calculated by taking the sum of the value of the Fund's securities plus
any cash and other assets (including dividends and interest accrued but not
collected) less all liabilities, including accrued expenses, allocable to the
Fund.
"Note" shall have the meaning set forth in Section 2(b).
"NYSE Securities" shall mean securities issued by an entity
organized in one of the states of the United States or the District of Columbia
which are listed for trading, and actively traded, on the New York Stock
Exchange.
"Obligations" shall mean all of the Borrower's liabilities,
obligations and indebtedness to the Bank hereunder, under the Note and the other
Loan Documents, or otherwise incurred in connection with the Fund, whether
heretofore, now or hereafter arising and howsoever evidenced, whether primary,
secondary, contingent or fixed or arising under oral or written agreement or by
operation of law.
"Officer's Certificate" shall mean a certificate signed in the name
of the Borrower by an Authorized Officer containing the information noted in
Section 6(a)(i) hereof, and any amendment and/or restatement of same.
"Permitted Indebtedness" shall mean (i) liabilities incurred in the
ordinary course of business which are not past due (except for those taxes which
are being contested in good faith by appropriate proceedings and for which
adequate reserves in conformity with GAAP have been provided), (ii) liabilities
the Borrower is permitted to incur on behalf of the Fund under the Fund
Statement or the Prospectus, (iii) the Obligations, (iv) other obligations,
liabilities and indebtedness owed by the Borrower to the Bank.
"Prime Rate" shall mean the rate which the Bank announces as its
prime lending rate, as in effect from time to time. The Prime Rate is determined
solely by the Bank pursuant to market factors and its own operating needs and
does not necessarily represent the lowest or best rate actually charged to any
customer. The Bank may make commercial or other loans at rates of interest at,
above or below the Prime Rate.
"Prospectus" shall mean the Prospectus of the Borrower dated April
1, 2004, for its Xxxxxxxx Xxxxx Growth Fund, as amended and supplemented from
time to time (including, as fully as if it were set forth therein, the Fund
Statement).
"Requirement of Law" as to any person shall mean the articles or
certificate of incorporation and bylaws or other organizational or governing
documents of such person and any law, treaty, rule or regulation or
determination of an arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such person or any of its property or to
which such person or any of its property is subject.
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"Series" shall mean a separate series established by the Borrower's
board of directors pursuant to the articles of incorporation.
(b) General Provisions Relating to Definitions. Terms for which
meanings are defined in this Agreement shall apply equally to the singular and
plural forms of the terms defined. Whenever the context may require, any pronoun
shall include the corresponding masculine, feminine and neuter forms. The term
"including" means including, without limiting the generality of any description
preceding such term. Each reference herein to any person shall include a
reference to such person's permitted successors and assigns.
(c) Cross-References. Unless otherwise specified, references in this
Agreement and in each Loan Document to any Section are references to such
Section of this Agreement or such Loan Document, as the case may be, and unless
otherwise specified, references in any Section or definition to any clause are
references to such clause of such Section or definition.
2. Loans Facility.
(a) Loans. Subject to the terms and conditions set forth herein, and
subject to the satisfaction of the conditions set forth in Section 6 hereof, the
Bank may, in its sole discretion, lend and relend to the Borrower for the
account and benefit of the Fund, during the period from the Effective Date to
the earlier of (i) the Maturity Date (or the date of any extension of this
Agreement in a writing signed by the Bank) or (ii) the date of the occurrence of
an Event of Default, unless waived in a writing signed by the Bank, such amounts
as the Borrower may from time to time request (each individually a "Loan" and
collectively, the "Loans") up to an aggregate principal amount outstanding at
any time not to exceed the amount of the Available Facility. The proceeds of
Loans may only be used by the Fund for short term liquidity in connection with
shareholder redemptions permitted under the Fund Statement and the Prospectus.
This Agreement does not establish a commitment or obligation of the
Bank to lend money to the Borrower. The decision of whether or not to make any
Loan shall be made by the Bank in its sole and absolute discretion.
(b) Note. The Loans shall be evidenced by a promissory note given by
Borrower to the Bank, in the form of Exhibit A attached hereto and made a part
hereof (as such note may be extended, amended, restated, supplemented or
otherwise modified from time to time, and together with any one or more notes
which may be issued in exchange for such note, the "Note"). The Bank is hereby
authorized by Borrower to enter from time to time the principal balance of the
Loans and all payments and prepayments thereon on the reverse of the Note or in
the Bank's regularly maintained data processing records, and the aggregate
unpaid amount of the Loan set forth thereon or therein shall be presumptive
evidence of the principal amount owing to the Bank and unpaid thereon, absent
manifest error. Upon written request of the Bank, Borrower shall immediately
exchange its Note then outstanding for a revised and updated Note. The Borrower
further authorizes the Bank to charge any account of the Borrower, in the name
of the Fund, at the Bank or charge or increase any loan balance of the Borrower
for the amount of any payments due to the Bank hereunder.
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(c) Loan Requests. The Borrower shall notify, by written notice in
the form attached hereto as Exhibit B (each such notice, a "Loan Request"), such
person at the Bank as the Bank may, from time to time, instruct the Borrower, by
2:00 p.m. (Eastern Time) on each day on which the Borrower desires to obtain a
Loan hereunder, which day must be a Business Day, specifying the amount of the
Loan desired. Notwithstanding the foregoing sentence, the Borrower may verbally
request Loan hereunder, provided that the Borrower shall, on the same day, send
the Bank by telecopy a follow-up Loan Request in respect thereof. In no event
shall the Borrower request any loan which, if advanced, would cause the
aggregate principal amount of the Loans outstanding to exceed the Available
Facility. Each verbal request for a Loan hereunder shall be deemed to include,
and each written request shall include, a representation that all of the
representations and warranties made by the Borrower in the Loan Documents are
and will be, after giving effect to the requested Loan, true and complete, that
all the conditions precedent to such Loan as set forth in Section 6 hereof have
been satisfied, and that the proceeds of the Loan will not be used for any
purpose that is not permitted hereunder. Each advance of Loan proceeds hereunder
shall be in a minimum amount of $1,000.00.
(d) Disbursement of Funds. Each Loan shall be effectuated by the
Bank crediting an account number maintained by the Bank.
(e) Interest.
(i) The Borrower shall pay interest on the outstanding
principal balance of the Loans at a rate per annum equal to Prime, which
interest shall be payable (A) monthly, in arrears, commencing on November 1,
2004 and on the first day of each month thereafter, (B) whenever all or any part
of the Loans are due, whether on the Maturity Date, by virtue of a mandatory
prepayment, or by reason of demand, acceleration or otherwise (on the amount
then due) and (C) whenever the Borrower repays all of the Loans as a voluntary
prepayment.
(ii) Upon the occurrence and during the continuance of any
Event of Default hereunder, at the option of the Bank, the Loans and other
Obligations of the Borrower to the Bank shall bear interest (computed and
adjusted in the same manner, and with the same effect, as interest on the Loans
prior to the occurrence of such Event of Default) payable on demand at a rate
equal to three percent (3%) per annum in excess of the otherwise applicable
rate.
(iii) Interest on the Loans shall be computed on the basis of
a year consisting of three hundred sixty (360) days but applied to the actual
number of days elapsed.
(iv) If any payment is not made within ten (10) days after the
date due, the Borrower shall pay the Bank an amount equal to five percent (5%)
of such payment or $50.00, whichever is greater.
(f) Maximum Outstanding Period. Notwithstanding anything herein to
the contrary, no Loan draw shall be outstanding for more than forty-five (45)
days.
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3. Payments.
(a) Mandatory Prepayments.
(i) The Borrower agrees that if the aggregate principal
amount of Loans outstanding exceeds the Available Facility at any time, such
excess shall be immediately due and payable to the Bank.
(ii) The Borrower agrees to repay the Loans in full in
cash together with interest accrued thereon and any other fees and charges
hereunder on the Maturity Date and, if earlier, the date on which the Loans
become due, whether by virtue of a mandatory prepayment provision, by demand,
acceleration or otherwise.
(b) Voluntary Prepayments. The Borrower may prepay a Loan in
whole or in part from time to time; provided, however, that each prepayment
shall be in an amount equal to, or greater than, $1000.00 or, if less, the
outstanding balance of such Loan, and shall be made with interest accrued
thereon.
(c) Increased Costs.
(i) If the adoption of or any change in any Requirement
of Law or in the interpretation or application thereof or compliance by the Bank
with any request or directive (whether or not having the force of law) from any
Governmental Authority made subsequent to the Effective Date shall subject the
Bank to any tax of any kind whatsoever with respect to this Agreement, the Note
or any Loan made by it, or change the basis of taxation of payments to the Bank
in respect thereof and the result is to increase the cost to the Bank, by an
amount which the Bank deems to be material, of making or maintaining the Loans,
or to reduce any amount receivable hereunder in respect thereof, then the
Borrower shall promptly pay the Bank, upon its demand, any additional amounts
necessary to compensate the Bank for such increased cost or reduced amount
receivable.
(ii) If the Bank shall have determined that the adoption
of or any change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by the Bank or any
corporation controlling the Bank with any request or directive regarding capital
adequacy (whether or not having the force of law) from any Governmental
Authority made subsequent to the Effective Date shall have the effect of
reducing the rate of return on the Bank's or such corporation's capital as a
consequence of its obligations hereunder to a level below that which the Bank or
such corporation could have achieved but for such adoption, change or compliance
(taking into consideration the Bank's or such corporation's policies with
respect to capital adequacy) by an amount deemed by the Bank to be material,
then from time to time, after submission by the Bank to the Borrower of a
written request therefor, the Borrower shall pay to the Bank such additional
amount or amounts as will compensate the Bank for such reduction.
(iii) A certificate as to any amounts payable pursuant
to this subsection (c) submitted by the Bank to the Borrower shall be conclusive
in the absence of manifest error.
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(d) Taxes. All payments made by the Borrower under this
Agreement and the Note shall be made free and clear of, and without deduction or
withholding for or on account of, any present or future income, stamp or other
taxes imposed, levied, collected, withheld or assessed by any Governmental
Authority, excluding net income taxes and franchise taxes (imposed in lieu of
net income taxes). If any such non-excluded taxes, levies, imposts, duties,
charges, fees, deductions or withholdings ("Non-Excluded Taxes") are required to
be withheld from any amounts payable to the Bank hereunder or under the Note,
such amounts shall be increased to the extent necessary to yield to the Bank
(after payment of all Non-Excluded Taxes) interest or any such other amounts
payable hereunder at the rates or in the amounts specified in this Agreement and
the Note. Whenever any Non-Excluded Taxes are payable by the Borrower, as
promptly as possible thereafter the Borrower shall send to the Bank a certified
copy of an original official receipt received by the Borrower showing payment
thereof. If the Borrower fails to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fails to remit to the Bank the required receipts
or other required documentary evidence, the Borrower shall indemnify the Bank
for any incremental taxes, interest or penalties that may become payable by the
Bank as a result of any such failure.
(e) Place of Payment. All payments of principal and interest
hereunder shall be made in immediately available funds to the Bank at 000 Xxxxxx
Xxxxxx, Xxxxxxxxxx, Xxxx 00000, M.L. CN-OH-W6TC, or at such other place as may
be designated by the Bank to the Borrower in writing.
(f) Business Day Payments. Whenever any of the terms and
provisions of this Agreement or the other Loan documents provides that any
payment to be made shall be due on a day which is not a Business Day, such
payment shall be made on the next succeeding Business Day and such extension of
time shall be included in computing interest, if any, in connection with such
payment.
4. Representations and Warranties. To induce the Bank to enter into
this Agreement, the Borrower represents and warrants to the Bank as follows:
(a) Existence. The Borrower is duly organized, validly
existing and in active status as a corporation under the laws of Wisconsin and
is registered as an investment company under the Act.
(b) Authority. The Borrower has full power and authority to
own its properties and to conduct its business as an investment company and to
execute, deliver and perform its obligations under this Agreement and the other
Loan Documents.
(c) Borrowing Authorization. The execution, delivery and
performance by the Borrower of this Agreement and the other Loan Documents: (i)
have been duly authorized by all requisite action; (ii) do not and will not
violate (A) any law, regulation, order, writ, judgment, decree, determination or
award currently in effect and applicable to the Borrower, (B) the articles of
incorporation, declaration of trust or bylaws or other organizational or
governing documents of the Borrower, (C) any provision of any agreement to which
the Borrower is a party, or by which it or any of its
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properties or assets is bound, and (D) any franchise, license, permit,
certificate, authorization, qualification, accreditation or other similar right,
consent or approval of or applicable to the Borrower; and (iii) do not and will
not result in the creation or imposition of any Lien upon any of the properties
or assets of the Borrower. No consents, licenses, permits, applications or
authorizations of, notices or reports to, or registrations, filings or
declarations with, any Governmental Authority or other third party are required
to be obtained in connection with the execution, delivery or performance by the
Borrower of any of the Loan Documents.
(d) Enforceability. This Agreement and the other Loan
Documents have been duly executed and delivered by the Borrower, pursuant to due
authorization, and constitute the legal, valid and binding obligations of the
Borrower, enforceable against the Borrower in accordance with their terms.
(e) Financial Information; Adverse Change. The Borrower has
provided, or prior to the Effective Date will provide, the Bank with (i) its
audited financial statements for its fiscal year ended November 30, 2003 and
(ii) the Prospectus. The Borrower does not have any contingent liabilities not
provided for or disclosed in such financial statements. Such financial
statements present fairly, in all respects, the financial condition of the
Borrower in accordance with GAAP. There has been no material adverse change in
the business or financial condition of the Borrower since the date of such
financial statements.
(f) Indebtedness. The Borrower has no Indebtedness other than
Permitted Indebtedness.
(g) Investments. None of the Borrower's Series, including the
Fund, has Investments which such Series is not authorized to have or which are
inconsistent with or conflict with the provisions of the Prospectus relating to
such Series and the Borrower generally or for which it or the Borrower is
required to obtain shareholder approval.
(h) Litigation. There is no litigation or other action or
proceeding pending or, to the best of the knowledge of the Borrower after
diligent investigation, threatened against or affecting the Borrower or any of
its Series before any Governmental Authority.
(i) Title to Property. The Borrower (or, to the extent
applicable, each Series) has good, indefeasible and merchantable title to and
ownership of all of its assets free and clear of all Liens.
(j) Compliance. The Borrower is in compliance with the Act and
all other Applicable Laws.
(k) No Default. No default (or event which, with notice or
lapse of time, or both, would constitute a default) exists under any agreement
or instrument to which the Borrower is a party or pursuant to which any property
of the Borrower is encumbered.
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(l) Taxes. The Borrower has filed all federal, state and local
tax returns and other reports which it is required by law to file, has paid all
taxes, assessments and other similar charges that are due and payable, except to
the extent that any such taxes or charges are being contested in good faith by
appropriate proceedings and for which adequate reserves in accordance with GAAP
have been set aside on its books and records, and has withheld all employee and
similar taxes which it is required by law to withhold.
(m) Licenses, Etc. The Borrower has obtained and holds in full
force and effect, all franchises, licenses, permits, certificates,
authorizations, qualifications, accreditations, and other consents, rights and
approvals which are necessary for the operation of its business. The Borrower is
not in violation of the terms of any such franchise, license, permit,
certificate, authorization, qualification, accreditation, consent, right or
approval.
(n) Broker's Fees. No brokerage, finder's or similar fee or
commission is due to any party by reason of the Borrower entering into this
Agreement or by reason of any of the transactions contemplated hereby, and the
Borrower shall indemnify and hold the Bank harmless from all such fees and
commissions.
5. Borrower's Covenants. The Borrower agrees with the Bank that,
from the date of this Agreement and until the Loans are paid in full and all
obligations under this Agreement and the other Loan Documents are fully
performed and this Agreement has been terminated:
(a) Books and Records; Inspection. The Borrower shall keep and
maintain complete books, records and files with respect to its business in
accordance with GAAP and shall accurately and completely record all transactions
therein. The Borrower shall permit the officers, employees and designated
representatives of the Bank, from time to time to inspect the Borrower's
property and to inspect and make copies of or extracts from the books, records
and files of the Borrower, and the Borrower shall make the same available to the
Bank and its agents and representatives for such purposes at such reasonable
times as the Bank shall request.
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(b) Financial Statements; Reports. The Borrower shall furnish to the
Bank: (i) within one hundred twenty (120) days after the last day of each fiscal
year of the Borrower, a copy of the annual audit report of the Borrower prepared
in accordance with GAAP, with detail reasonably satisfactory to the Bank, and
consisting of at least a statement of assets and liabilities for each of the
Series (including the Fund) as at the close of such fiscal year, a Schedule of
Investments for each of the Series (including the Fund) as at the close of such
fiscal year, a statement of operations for each of the Series (including the
Fund) for such fiscal year and a statement of changes in net assets for each of
the Series (including the Fund) for such fiscal year, and certified by an
independent certified public accountant satisfactory to the Bank; (ii)
statements of the Borrower's and the Fund's Net Assets and the market value of
the assets of each Series (including the Fund) of the Borrower, whether or not
held by the Custodian, on a daily basis whenever any Loans are outstanding
hereunder and otherwise upon the Bank's request; (iii) promptly upon
transmission thereof, copies of all regular and periodic financial information,
proxy materials and other information and reports, if any, which the Borrower
shall file with the Securities and Exchange Commission or any governmental
agencies substituted therefor or which the Borrower shall send to its
shareholders generally; and (iv) such other reports and information as the Bank
may reasonably request from time to time.
(c) Taxes. The Borrower shall file all federal, state and local tax
returns and other reports the Borrower is required by law to file, and shall pay
when due all taxes, assessments and other liabilities except for those contested
in good faith by appropriate proceedings for which adequate reserves in
conformity with GAAP will be provided and shall withhold all employee and
similar taxes which it is required by law to withhold.
(d) Existence and Status. The Borrower shall maintain its existence
as a corporation in active status under the laws of Wisconsin, shall continue to
be registered as an investment company under the Act and shall continue to
maintain the Fund as a separate Series of the Borrower.
(e) Compliance with Law. The Borrower shall comply at all times with
the Act and all other Applicable Laws.
(f) Borrower's Coverage Ratio. The Borrower shall not permit the
ratio of its (i) total assets minus total liabilities (other than liabilities of
any kind or nature whatsoever for borrowed money and liabilities in respect of
overdrafts in any account (whether trust, demand deposit or other account)
maintained by the Borrower) to (ii) total liabilities of any kind or nature
whatsoever for borrowed money and liabilities in respect of overdrafts in any
account (whether trust, demand deposit or other account) maintained by the
Borrower to be less than 300% at any time.
(g) Fund's Coverage Ratio. The Borrower shall not permit the ratio
of the Fund's (i) total assets minus total liabilities (other than liabilities
of any kind or nature whatsoever for borrowed money and the Fund liabilities in
respect of overdrafts in any account (whether trust, demand deposit or other
account) maintained by the Borrower on behalf of the Fund) to (ii) total
liabilities of any kind or nature whatsoever for borrowed money and the Fund's
liabilities in respect of overdrafts in any account
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(whether trust, demand deposit or other account) maintained by the Borrower on
behalf of the Fund to be less than 300% at any time.
(h) Licenses. The Borrower shall obtain and maintain all franchises,
licenses, permits, certificates, authorizations, qualifications, accreditations,
and other consents, rights and approvals which are required by law or are
necessary for the operation of its business.
(i) Notice. The Borrower shall notify the Bank in writing, promptly
upon the Borrower's learning thereof, of: (i) any material litigation, suit or
administrative proceeding which may affect the operations, financial condition
or business of the Borrower or the Bank's interest in any of the Collateral;
(ii) any default by the Borrower under any note, indenture, loan agreement,
mortgage, lease, deed or other agreement to which the Borrower is a party or by
which the Borrower or its assets are bound; (iii) a Default or an Event of
Default under this Agreement; and (iv) any default by any obligor under any note
or other evidence of Indebtedness payable to the Borrower.
(j) Use of Proceeds. The Borrower shall not use the proceeds of the
Loans for any purpose other than short term liquidity in connection with
shareholder redemptions as provided in the Fund Statement and the Prospectus.
(k) Liens. The Borrower shall not create or permit to exist any
Liens with respect to any of the assets or property of the Fund, whether now
owned or hereafter acquired, except Liens in favor of the Bank.
(l) Investments. The Borrower shall not make, agree to make, or hold
any Investment which it is not permitted to make without shareholder approval
and shall make only those Investments which conform with the provisions of the
Prospectus. Without limiting the generality of the foregoing, the Borrower shall
not permit the Fund to make, agree to make, or hold any Investment which it is
not permitted to make without shareholder approval and shall comply in all
respects with, and shall make only those Investments which conform with, the
provisions of the Prospectus relating to the Fund and the provisions of the
Prospectus relating to the Borrower generally.
(m) Transfer of Property. The Borrower shall not sell, transfer,
convey or lease, any of the assets or property of the Borrower, other than in
the ordinary course of business.
(n) Change in Structure; Change in Business. The Borrower shall not
enter into any business which is substantially different from that presently
conducted by the Borrower. The Borrower shall maintain the Fund as a Series
separate and apart from any other Series.
(o) Indebtedness. The Borrower shall not incur or permit to exist
any Indebtedness other than Permitted Indebtedness. Notwithstanding anything
herein to the contrary, except for the Loans made by Bank hereunder, the
Borrower shall not incur or permit to exist any Indebtedness for liquidity or
leverage purposes.
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(p) Bank Accounts. The Borrower shall not make or maintain deposits
on its own behalf or on behalf of the Fund with any bank or similar institution
which has any right of set-off, bankers' lien, combination or consolidation of
accounts, counterclaim or other similar right under Applicable Law with respect
to such deposit.
(q) Compliance with Agreements. The Borrower shall, and shall cause
the Fund to, comply with all agreements and instruments to which it is a party
or pursuant to which any of its property is encumbered.
(r) Solvency. Immediately after giving effect to the execution and
delivery of the Loan Documents and the making of the Loans hereunder and at all
times thereafter while the Loans or any portion thereof are outstanding, each of
the Borrower and the Fund shall be solvent, shall be able to pay its debts and
obligations as they become due, and shall have capital sufficient to carry on
its business.
(s) Contracts. The Borrower shall not, and shall not permit the Fund
to, enter into any agreement, contract or arrangement which would impair or
adversely affect (i) its right and/or ability to carry on its business as now
conducted or (ii) its right and/or ability to carry on the business of the Fund
(as if the Fund were a separate business) as now conducted.
(t) Insurance. The Borrower shall maintain such insurance as is
typically maintained by prudent companies in the same line of business as the
Borrower, and, without limitation of the generality of the foregoing, shall
maintain all insurance required under the Act.
(u) Waiver. Any variance from the covenants of the Borrower pursuant
to this Section 5 shall be permitted only with the prior written consent and/or
waiver of the Bank. Any such variance by consent and/or waiver shall relate
solely to the variance addressed in such consent and/or waiver, and shall not
operate as the Bank's consent and/or waiver to any other variance of the same
covenant or other covenants, nor shall it preclude the exercise by the Bank of
any power or right under this Agreement, other than with respect to such
variance.
6. Conditions Precedent.
(a) Conditions Precedent to the Effective Date. This Agreement shall
become effective on the date (the "Effective Date") on which the following
conditions precedent shall have been satisfied or waived by the Bank in its sole
and absolute discretion:
(i) Proof of Action; Incumbency. The Bank shall have received
an Officer's Certificate from the Borrower dated the Effective Date,
substantially in the form attached hereto as Exhibit C, and certifying (A) that
attached thereto is a true and complete copy of the articles of incorporation,
organization or partnership or declaration of trust, and operating agreement or
bylaws or other organizational and governing documents of the Borrower, as in
effect as of the Effective Date, (B) that attached thereto is the true and
correct copy of the records of all action taken by the Borrower to authorize its
execution and delivery of this Agreement and the other Loan Documents
12
(and the Loans contemplated hereby and thereby), and (C) as to the incumbency,
the name and specimen signature of each and every officer of Borrower, each of
whom shall be authorized (each an "Authorized Officer") (1) to sign and deliver
to the Bank, in the name of the Borrower, (1) this Agreement, any Loan Request,
the Note and the other Loan Documents, and any amendments thereof, and (2)
certificates and notices (including, without limitation, new Officer's
Certificates) and to take other action on its behalf under this Agreement. The
Borrower shall promptly file a new Officer's Certificate with updated incumbency
information whenever the officers of the Fund should change.
(ii) Note. The Bank shall have received a fully executed Note.
(iii) Representations and Warranties. The Bank shall have
received from the Borrower an Officer's Certificate to the effect that each of
the representations and warranties made by the Borrower in this Agreement and in
the other Loan Documents is true and correct.
(iv) No Default. The Bank shall have received from the
Borrower an Officer's Certificate to the effect that no Default or Event of
Default is continuing on the Effective Date, or would result from the
transactions contemplated to occur on the Effective Date.
(v) Opinion. The Borrower shall have delivered to the Bank an
opinion of counsel acceptable to the Bank dated the Effective Date,
substantially in the form attached hereto as Exhibit D.
(vi) Expenses. The Borrower shall have paid to the Bank the
fees, expenses and disbursements required to be paid by the Borrower pursuant to
Section 8(d) hereof.
(vii) Financial Statements. The Borrower shall have provided
the Bank with (A) its audited financial statements for its fiscal year ended
November 30, 2003 (B) the Prospectus and (C) the Fund Statement.
(b) Conditions Precedent to Each Loan. The making of each Loan is
subject to the satisfaction of each of the following conditions precedent,
unless waived by the Bank in its sole and absolute discretion:
(i) Default. Before and after giving effect to such Loan, or
any portion thereof, no Default or Event of Default shall have occurred and be
continuing (and there exists no event which would, with notice or lapse of time
or both, mature into a Default or an Event of Default).
(ii) Representations and Warranties. Before and after giving
effect to such Loan or any portion thereof, the representations and warranties
set forth herein and in the other Loan Documents shall be true and correct as
though made on the date of such Loan.
13
(iii) Adverse Change. There shall have been no material
adverse change in the business or financial condition of the Borrower or the
Fund since the Effective Date.
(iv) Other Actions. The Borrower shall take such other actions
and deliver to the Bank such other documents, certificates and instruments as
the Bank may reasonably request to evidence, protect or perfect the Loans.
7. Events of Default. If any of the following events (each, an
"Event of Default") shall occur, then the Bank may without further notice or
demand, accelerate the Loans and declare them to be, and thereupon the Loans
shall become, immediately due and payable (except that upon the occurrence of an
Event of Default as described in Section 7(h) or (i) below, the Loans shall be
automatically due and payable) and the Borrower may not request further Loans
hereunder (or if already requested, may not receive the proceeds of any Loans
hereunder), and, regardless of whether or not the Loans shall have been
accelerated, the Bank shall have all rights provided herein and in any of the
other Loan Documents or otherwise provided by law:
(a) The Borrower shall not have paid or repaid to the Bank any
principal of or any interest on the Loans or any other obligation hereunder or
under any of the other Loan Documents when due, whether by reason of demand,
acceleration or otherwise; or
(b) There shall have occurred any other violation or breach or any
covenant, agreement or condition contained herein or in any other Loan Document
except that, in the event of a Default of the Borrower's obligation to deliver
the statements required under Section 5(b)(iii), such Default shall not
constitute an Event of Default hereunder unless the Bank has notified the
Borrower of such Default and the Borrower has not cured such Default within
thirty-six (36) hours of receiving such notice; or
(c) The Borrower shall not have paid when due any other
Indebtedness, or the holder of such other Indebtedness shall have declared such
Indebtedness due prior to its stated maturity because of the Borrower's default
thereunder or the Borrower shall have failed to perform any of its obligations
under agreements relating to Indebtedness which failure would, if not cured,
give the holder of such Indebtedness the right to accelerate the maturity of
such Indebtedness; or
(d) There shall have occurred any violation or breach of any
covenant, agreement or condition contained in any other agreement between the
Borrower and the Bank; or
(e) The Borrower shall not have performed its obligations under any
agreement material to its business; or
(f) Any representation or warranty made or deemed made herein or in
any other Loan Document or writing furnished in connection with this Agreement
shall have proven to be false when made or when deemed to have been made; or
(g) The Borrower shall have been unable to pay its debts as due; or
14
(h) The Borrower shall have made an assignment for the benefit of
creditors; or
(i) The Borrower shall have applied for the appointment of a trustee
or receiver for any part of its assets or shall have commenced any proceedings
relating to the Borrower under any bankruptcy, reorganization, arrangement,
insolvency, readjustment of debt, dissolution or other liquidation law of any
jurisdiction; or any such application shall have been filed, or any such
proceedings shall have commenced, against the Borrower, and either the Borrower
shall have indicated its approval, consent or acquiescence thereto or such
proceedings shall not have been dismissed within forty-five (45) days; or an
order shall have been entered appointing such trustee or receiver, or
adjudicating the Borrower bankrupt or insolvent, or approving the petition in
any such proceedings; or
(j) Any part of the Borrower's operations shall have ceased; or
(k) Any final judgment which, together with other outstanding
judgments against the Borrower, causes the aggregate of such judgments to exceed
One Hundred Thousand Dollars ($100,000), shall have been rendered against the
Borrower; or
(l) There shall have occurred any material adverse change in the
business or financial condition of the Borrower or its ability to repay the
Loans; or
(m) Xxxxxxxx Investment Management, LLC shall no longer be the
investment advisor to the Borrower; or
(n) The Custodian shall no longer be the custodian, or the Borrower
has evidenced any intent to remove the Custodian from its position as custodian,
of the securities and financial assets (as such terms are defined in Article 8
of the Uniform Commercial Code as adopted in the State of Ohio [the "UCC"]) of
the following described securities account (as such term is defined in Article 8
of the UCC) held by Custodian: account number 000012494300 in the name of The
Xxxxxxxx Plumb Growth Fund.
8. Miscellaneous.
(a) Right of Set-Off. In addition to all statutory rights of the
Bank, the Bank is hereby authorized at any time and from time to time, without
prior notice to the Borrower, to set-off, appropriate and apply any and all
moneys, securities and other properties of the Borrower and the proceeds thereof
now or hereafter held or received by or in transit to the Bank from or for the
account of the Borrower, whether for safekeeping, pledge, transmission,
collection or otherwise, and also upon any and all deposits (general and
special), account balances and credits of the Borrower with the Bank at any time
existing including, without limitation, account balances and credits of the
Borrower held by the Bank as Custodian, against all obligations arising under
this Agreement or any of the other Loan Documents, or any other agreements
between the Bank and Borrower, and the Borrower shall continue to be liable to
the Bank for any deficiency with interest at the rate set forth herein.
15
(b) Delay. No delay, omission or forbearance on the part of the Bank
in the exercise of any power or right shall operate as a waiver thereof, nor
shall any single or partial delay, omission or forbearance in the exercise of
any other power or right. The rights and remedies of the Bank herein provided
are cumulative, shall be interpreted in all respects in favor of the Bank, and
are not exclusive of any other rights and remedies provided by law.
(c) Notice. Except as otherwise expressly provided in this
Agreement, any notice hereunder shall be in writing and shall be given by
personal delivery, telecopy, or overnight courier or registered or certified
mail, postage prepaid, and addressed to the parties at their addresses set forth
below:
Bank: U.S. Bank National Association
000 Xxxxxx Xxxxxx, Mail Location CN-OH-W6TC
Xxxxxxxxxx, Xxxx 00000
Attention: Xxxxxx X. Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Borrower: Xxxxxxxx Plumb Funds, Inc.
1200 Xxxx X. Xxxxxxx Xxxxx, 0xx xxxxx
Xxxxxxx, Xxxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
The Borrower or the Bank may, by written notice to the other as
provided herein, designate another address or number for purposes hereunder. All
notices and other communications given to any party hereto in accordance with
the provisions of this Agreement shall be deemed to have been given on the date
of receipt if delivered by hand or overnight courier service or sent by telecopy
or on the date five (5) Business Days after dispatch by certified or registered
mail if mailed (or, if sooner, on the date of actual receipt), in each case
delivered, sent or mailed (properly addressed) to such party as provided in this
Section 8(c) or in accordance with the latest unrevoked direction from such
party given in accordance with this Section 8(c).
(d) Expenses; Indemnity. The Borrower agrees to pay all reasonable
out-of-pocket expenses of the Bank and its employees (including reasonable
attorney's fees and legal expenses, but excluding the salaries of the Bank's own
employees) incurred by the Bank in entering into and closing this Agreement and
preparing the documentation in connection herewith, and administering or
enforcing the obligations of the Borrower hereunder or under any of the other
Loan Documents, and the Borrower agrees to pay the Bank upon demand for the
same. The Borrower further agrees to defend, indemnify and hold the Bank
harmless from any liability, obligation, cost, damage or expense, including
attorney's fees and legal expenses for taxes, fees or third party claims which
may arise or be related to the execution, delivery or performance of this
Agreement or any of the other Loan Documents, except in the case of gross
negligence or willful misconduct on the part of the Bank.
16
(e) Survival. All covenants and agreements of the Borrower made
herein or otherwise in connection with the transactions contemplated hereby
shall survive the execution and delivery of this Agreement and the other Loan
Documents, and shall remain in effect so long as any obligations of the Borrower
are outstanding hereunder or under any of the other Loan Documents. The
obligations of the Borrower set forth in Sections 3(c), 3(d) and 8(d) shall
survive the termination of this Agreement and repayment of the Obligations.
(f) Severability. Any provision of this Agreement or any of the
other Loan Documents which is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such prohibition
of enforceability without invalidating the remaining portions hereof or
affecting the validity or enforceability or such provision in any other
jurisdiction.
(g) Governing Law. The Loans shall be deemed made in Ohio and this
Agreement and all of the other Loan Documents, and all of the rights and
obligations of the Borrower and the Bank hereunder and thereunder, shall in all
respects be governed by and construed in accordance with the laws of the State
of Ohio, including all matters of construction, validity and performance.
Without limitation on the ability of the Bank to exercise all of its rights as
to the Collateral or to initiate and prosecute any action or proceeding in any
applicable jurisdiction related to loan repayment, the Borrower and the Bank
agree that any action or proceeding commenced by or on behalf of the parties
arising out of or relating to the Loans and/or this Agreement and/or any of the
other Loan Documents shall be commenced and maintained exclusively in the
District Court of the United States for the Southern District of Ohio, or any
other court of applicable jurisdiction located in Cincinnati, Ohio. The Borrower
and the Bank also agree that a summons and complaint commencing an action or
proceeding in any such Ohio courts by or on behalf of such parties shall be
properly served and shall confer personal jurisdiction on a party to which said
party consents, if (i) served personally or by registered or certified mail to
the other party at any of its addresses noted herein, or (ii) as otherwise
provided under the laws of the State of Ohio. The Borrower and the Bank hereby
waive all rights to trial by jury in any proceeding arising out of or related to
the transactions contemplated hereunder or under any of the other Loan
Documents. The interest rate and all other terms of the Loans negotiated with
the Borrower are, in part, related to the aforesaid provisions on jurisdiction,
which the Bank deems a vital part of this loan arrangement.
(h) Successors. This Agreement shall be binding upon and inure to
the benefit of the Borrower and the Bank and their respective successors and
assigns. The Borrower shall not assign its rights or delegate its duties
hereunder or under any other Loan Document without the prior written consent of
the Bank.
(i) Amendment. This Agreement may not be modified or amended except
in writing signed by authorized officers of the Bank and the Borrower.
(j) Headings. The descriptive headings of the several Sections of
this Agreement are inserted for convenience only and do not constitute a part of
this Agreement.
17
(k) Confession of Judgment. Borrower hereby irrevocably authorizes
and empowers any attorney-at-law to appear for Borrower in any action upon or in
connection with this Agreement at any time after the Loan and/or other
obligations of Borrower hereunder become due, as herein provided, in any court
in or of the State of Ohio or elsewhere, and waive the issuance and service of
process with respect thereto, and irrevocably authorizes and empowers any such
attorney-at-law to confess judgment in favor of Bank against Borrower in the
amount due thereon or hereon, plus interest as herein provided, and all costs of
collection, and waive and release all errors in any said proceedings and
judgments and all rights of appeal from the judgment rendered. The Borrower
agrees and consents that the attorney confessing judgment on behalf of the
Borrower hereunder may also be counsel to the Bank and/or the Bank's affiliates,
and the Borrower hereby further waives any conflicts of interest which might
otherwise arise and consents to the Bank paying such confessing attorney a legal
fee or allowing such attorneys' fees to be paid from proceeds of collection of
this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized as of the
date first above written.
THE BANK:
U.S. BANK NATIONAL ASSOCIATION
By: _____________________________________
Name: Xxxxxx X. Xxxxxxxxx
Title: Vice President
WARNING--BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND COURT TRIAL.
IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU WITHOUT YOUR
PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT FROM YOU
REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE BANK.
THE BORROWER:
XXXXXXXX XXXXX FUNDS, INC.
By: _____________________________________
Name: Xxxx X. Xxxxxxxx
Title: Chairman & Secretary
EXHIBITS:
A - Note
B - Loan Request
C - Officer's Certificate
D - Opinion of Counsel
18
EXHIBIT A
PROMISSORY NOTE
$20,000,000 Cincinnati, Ohio
October 1, 2004
Xxxxxxxx Xxxxx Funds, Inc., a Wisconsin corporation (the
"Borrower"), for value received, hereby promises to pay to the order of U.S.
BANK N.A. (the "Bank"), or its successors or assigns, on or before November 15,
2004 (the "Maturity Date"), the principal sum of Twenty Million Dollars
($20,000,000.00), or such portion thereof as may be outstanding from time to
time as a Loan under the hereinafter-described Loan Agreement, together with
interest thereon as hereinafter provided.
This Note is the "Note" to which reference is made in the Loan
Agreement dated as of October 1, 2004 with respect to the Xxxxxxxx Plumb Growth
Fund (the "Fund") between the Borrower and the Bank (as amended, supplemented or
otherwise modified from time to time, the "Loan Agreement") and is subject to
the terms and conditions thereof, including without limitation the terms thereof
providing for acceleration of maturity of the loans made by the Bank to the
Borrower under the Loan Agreement and evidenced by this Note (the "Loans").
This Note shall bear interest at a rate per annum equal to Prime,
which interest shall be payable to the Bank (i) monthly, in arrears, commencing
on November 1, 2004 and on the first day of each month thereafter, (ii) whenever
all or any part of the Loans are due and payable, whether on the Maturity Date,
by virtue of a mandatory prepayment, or by reason of demand, acceleration or
otherwise (on the amount so due and payable) and (iii) whenever the Borrower
repays all of the Loans as a voluntary prepayment. Interest on this Note shall
be computed on the basis of a year consisting of three hundred sixty (360) days
but applied to the actual number of days elapsed.
As used herein, the term "Prime Rate" shall mean the rate which the
Bank announces as its prime lending rate, as in effect from time to time. The
Prime Rate is determined solely by the Bank pursuant to market factors and its
own operating needs and does not necessarily represent the lowest or best rate
actually charged to any customer. The Bank may make commercial or other loans at
rates of interest at, above or below the Prime Rate.
The principal of this Note is subject to mandatory prepayments, as
follows: (i) if the aggregate principal amount of the Loans outstanding exceeds
the Available Facility at any time, such excess shall be immediately due and
payable and (ii) the principal of this Note shall be due and payable in full on
the Maturity Date and, if earlier, the date on which the Loans become due,
whether by virtue of demand, acceleration or otherwise. This Note may be
voluntarily prepaid in whole or in part at any time, without premium or penalty;
provided, however that each prepayment of principal shall be in an amount equal
to, or greater than, $1,000.00 or, if less, the outstanding balance of this
Note.
If any payment is not made within ten (10) days after the date due,
the Borrower shall pay the Bank an amount equal to five percent (5%) of such
payment or $50.00, whichever is greater.
An "Event of Default" as described in the Loan Agreement shall
constitute an Event of Default hereunder. Upon the occurrence of an Event of
Default, the Bank shall have all rights and remedies provided herein, in the
Loan Agreement and otherwise available at law or in equity. At the option of the
Bank, upon the occurrence and during the continuance of any Event of Default,
this Note shall bear interest (computed and adjusted in the same manner, and
with the same effect, as interest prior to the occurrence of such Event of
Default) payable on demand at a rate equal to three percent (3%) per annum in
excess of the otherwise applicable rate.
All payments of principal and interest hereunder shall be made in
immediately available funds to the Bank at 000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx
00000, M.L. CN-OH-W6TC, or at such other place as may be designated by the
holder hereof to the Borrower in writing. The Borrower authorizes the Bank to
charge any account, in the name of the Fund, or charge or increase any loan
balance of the Borrower at the Bank for the amount of any interest or principal
payments due to the Bank hereunder. The Bank is further authorized by the
Borrower to enter from time to time the balance of this Note and all payments
thereon on the reverse of this Note or in the Bank's regularly maintained data
processing records, and the aggregate unpaid amount set forth thereon or therein
shall be presumptive evidence of the amount owing to the Bank and unpaid on this
Note, absent manifest error.
If any term or condition of this Note conflicts with the express
terms or conditions of the Loan Agreement, the terms and conditions of the Loan
Agreement shall control. Terms used but not defined herein shall have the same
meanings herein as in the Loan Agreement.
IMPORTANT: This Note shall be deemed made in Ohio and shall in all
respects be governed by and construed in accordance with the laws of the State
of Ohio, including all matters of construction, validity and performance.
Without limitation on the ability of the Bank to initiate and
prosecute any action or proceeding in any applicable jurisdiction related to
loan repayment, the Borrower and the Bank agree that any action or proceeding
commenced by or on behalf of the parties arising out of or relating to this Note
shall be commenced and maintained exclusively in the United States District
Court for the Southern District of Ohio, or any other court of applicable
jurisdiction located in Cincinnati, Ohio. The Borrower and the Bank also agree
that a summons and complaint commencing an action or proceeding in any such Ohio
courts by or on behalf of such parties shall be properly served and shall confer
personal jurisdiction on a party to which said party consents, if (i) served
personally or by registered or certified mail to the other party at any of its
addresses noted herein, or (ii) as otherwise provided under the laws of the
State of Ohio. The Borrower and the Bank hereby waive all rights to trial by
jury in any proceeding arising out of or related to this Note. The interest rate
and all other terms of this Note negotiated with the Borrower are, in part,
related to the aforesaid provisions on jurisdiction, which the Bank deems a
vital part of this loan arrangement.
2
Presentment for payment, notice of dishonor, protest, demand, notice
of protest and all other notices are hereby waived.
Borrower hereby irrevocably authorizes and empowers any
attorney-at-law to appear for Borrower in any action upon or in connection with
this Agreement at any time after the Loans and/or other obligations of Borrower
evidenced hereby become due, as herein provided, in any court in or of the State
of Ohio or elsewhere, and waives the issuance and service of process with
respect thereto, and irrevocably authorizes and empowers any such
attorney-at-law to confess judgment in favor of Bank against Borrower in the
amount due thereon or hereon, plus interest as herein provided, and all costs of
collection, and waives and releases all errors in any said proceedings and
judgments and all rights of appeal from the judgment rendered. The Borrower
agrees and consents that the attorney confessing judgment on behalf of the
Borrower hereunder may also be counsel to the Bank and/or the Bank's affiliates,
and the Borrower hereby further waives any conflict of interest which might
otherwise arise and consents to the Bank paying such confessing attorney a legal
fee or allowing such attorneys' fees to be paid from proceeds of collection of
this Agreement and/or any and all collateral and security for the Loans and
obligations.
WARNING--BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU
WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT
FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE BANK.
Xxxxxxxx Xxxxx Funds, Inc.
By: _____________________________________
Name: Xxxx X. Xxxxxxxx
Title: Chairman & Secretary
3
EXHIBIT B
FORM OF LOAN REQUEST
U.S. Bank, National Association
000 Xxxxxx Xxxxxx, X.X. XX-XX-X0XX
Xxxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxx
Ladies and Gentlemen:
This loan request is delivered to you pursuant to Section 2(c) of
that certain Loan Agreement (as amended, supplemented or otherwise modified from
time to time (the "Loan Agreement") dated as of October 1, 2004 between U.S.
Bank National Association (the "Bank") and Xxxxxxxx Plumb Funds, Inc. (the
"Borrower") relating to the Xxxxxxxx Xxxxx Growth Fund (the "Fund"). Capitalized
terms used herein without definition shall have the meaning assigned to such
terms in the Loan Agreement unless the context otherwise requires.
The Borrower hereby [requests][confirms the verbal request made by
the Borrower prior to 2:00 p.m. on the date hereof for] a Loan on this date from
the Bank in the aggregate principal amount of $____________. The Borrower hereby
certifies, represents and warrants that on the date hereof, both before and
after giving effect to the requested Loan or any portion thereof:
(a) The aggregate principal amount of the Loans outstanding does not
and will not exceed the Available Facility;
(b) No Default or Event of Default has occurred and is continuing,
nor will the making of such Loan cause a Default or Event of Default to occur;
(c) All representations and warranties set forth in the Loan
Documents are and will be true and correct as though made on the date hereof;
(d) Since the Effective Date, there has not been and there will not
be any material adverse change in the business or financial condition of the
Borrower or the Fund, nor has there been nor will there be a material adverse
change in respect of the validity or enforceability or priority of any Liens
granted to the Bank under the Loan Documents;
(e) The proceeds of the Loans will not be used for any purpose that
is not permitted under the Loan Agreement; and
(f) Upon receipt by the Bank of this loan request, all conditions
set forth in Section 6(b) of the Loan Agreement will have been satisfied.
IN WITNESS WHEREOF, the Borrower has caused this loan request to be
executed and delivered by its duly Authorized Officer as of this_______ day of
_______________
Xxxxxxxx Xxxxx Funds, Inc.
By: _____________________________________
Name: ___________________________________
Title: __________________________________
2
EXHIBIT C
OFFICER'S CERTIFICATE
Xxxxxxxx Plumb Funds, Inc., a corporation is entering into and/or
continuing a loan transaction with U.S. BANK N.A. (the "Bank") pursuant to a
loan agreement effective as of even date herewith (the "Loan Agreement"). In
that connection, the undersigned certifies:
1. Attached hereto as Schedule 1 is a true copy of the Articles of
Incorporation of Borrower on file in the office of the Secretary of State of
Wisconsin which has not been modified, rescinded or superceded and remains in
full force and effect as of the date hereof.
2. Attached hereto as Schedule 2 is a true copy of the duly adopted
By-Laws of Borrower, which has not been modified, rescinded or superceded and
remains in full force and effect as of the date hereof.
3. Attached hereto as Schedule 3 are true copies of certain
resolutions authorizing the loan transactions which were duly adopted by the
Board of Directors of Borrower, and which have not been amended, rescinded or
superceded and remain in full force and effect as of the date hereof.
4. Borrower is not a party to any agreement that adversely affects,
or would be violated by its entering into, the loan transactions and any
document or instrument related thereto.
5. The execution and delivery of such loan facility documents (A)
does not violate or constitute on the part of Borrower a breach or default under
(i) any applicable provision of statutory law or regulations, (ii) any order,
judgment or decree of any court, governmental agency or authority, or (iii) any
agreement with any third party, and (B) does not require the approval or consent
of any governmental body or other person.
6. No Event of Default (as defined in Section 7 of the Loan
Agreement) or any event which, with the passage of time or the giving of notice,
might mature into an Event of Default has occurred or is continuing as of the
date hereof.
7. The representations and warranties in Section 4 of the Loan
Agreement are true and correct in all material respects as of the date hereof
(except for those limited to or expressed only as of a prior specific date).
8. The persons listed below are all the duly elected officers or
Borrower and each is authorized to execute on behalf of Borrower and deliver to
the Bank all documents and instruments described in the aforesaid resolutions of
the Borrower and in Section 6(a)(i) of the Loan Agreement.
NAME TITLE SIGNATURE
___________________ _______________ ____________________
___________________ _______________ ____________________
___________________ _______________ ____________________
___________________ _______________ ____________________
Dated as of ____________, 20___
BORROWER:
XXXXXXXX XXXXX FUNDS, INC.
By: _____________________________________
Name: Xxxx X. Xxxxxxxx
Title: Chairman & Secretary
2
EXHIBIT D
FORM OF OPINION OF BORROWER'S COUNSEL
We have acted as counsel to ______________, a _______________(the
"Borrower"), in connection with a loan in an amount of up to $ being made by
U.S. Bank National Association (the "Bank") to the Borrower in connection with
the ___________ Fund (the "Fund"). In this regard, we have examined the
following documents (collectively, the "Loan Documents"):
(i) Loan Agreement dated as of_________________ between the Borrower
and the Bank (the "Loan Agreement"); and
(ii) Promissory Note dated as of _____________ given by the Borrower
to the Bank.
On the basis of the foregoing, we are of the opinion that:
1. The Borrower is duly organized, validly existing and in active
status under the laws of _______________ and is registered as an investment
company under the Investment Company Act of 1940.
2. The Borrower has full power and authority to own its assets and
to conduct its business as a management investment company.
3. The Fund is a duly created and validly existing Series (as
defined in the Loan Agreement) of the Borrower.
4. The Borrower has full power and authority to execute the Loan
Documents and to perform its obligations thereunder.
5. The execution and delivery of, and the performance by the
Borrower of its obligations under, the Loan Documents (a) have been duly
authorized by all necessary action, (b) are not in conflict with and do not
violate any provisions of the Borrower's articles of incorporation, declaration
of trust or other organizational or governing documents, (c) do not violate any
law, rule, regulation, order or decree, and (d) to our knowledge, are not in
conflict with and do not result in any breach or default under any document,
instrument or agreement to which the Borrower is a party.
The Loan Documents have been duly executed and delivered by the Borrower and
constitute the legal, valid and binding obligations of the Borrower, enforceable
against the Borrower in accordance with their terms, subject, as to enforcement
of remedies, to applicable bankruptcy, insolvency, reorganization, moratorium
and other laws affecting the rights of creditors generally and the discretion of
courts in granting equitable remedies.
PROMISSORY NOTE
$20,000,000 Cincinnati, Ohio
Xxxxxxxx Xxxxx Funds, Inc., a Wisconsin corporation (the
"Borrower"), for value received, hereby promises to pay to the order of U.S.
BANK N.A. (the "Bank"), or its successors or assigns, on or before November 15,
2004 (the "Maturity Date"), the principal sum of Twenty Million Dollars
($20,000,000.00), or such portion thereof as may be outstanding from time to
time as a Loan under the hereinafter-described Loan Agreement, together with
interest thereon as hereinafter provided.
This Note is the "Note" to which reference is made in the Loan
Agreement dated as of October 1, 2004 with respect to the Xxxxxxxx Plumb Growth
Fund (the "Fund") between the Borrower and the Bank (as amended, supplemented or
otherwise modified from time to time, the "Loan Agreement") and is subject to
the terms and conditions thereof, including without limitation the terms thereof
providing for acceleration of maturity of the loans made by the Bank to the
Borrower under the Loan Agreement and evidenced by this Note (the "Loans").
This Note shall bear interest at a rate per annum equal to Prime,
which interest shall be payable to the Bank (i) monthly, in arrears, commencing
on November 1, 2004 and on the first day of each month thereafter, (ii) whenever
all or any part of the Loans are due and payable, whether on the Maturity Date,
by virtue of a mandatory prepayment, or by reason of demand, acceleration or
otherwise (on the amount so due and payable) and (iii) whenever the Borrower
repays all of the Loans as a voluntary prepayment. Interest on this Note shall
be computed on the basis of a year consisting of three hundred sixty (360) days
but applied to the actual number of days elapsed.
As used herein, the term "Prime Rate" shall mean the rate which the
Bank announces as its prime lending rate, as in effect from time to time. The
Prime Rate is determined solely by the Bank pursuant to market factors and its
own operating needs and does not necessarily represent the lowest or best rate
actually charged to any customer. The Bank may make commercial or other loans at
rates of interest at, above or below the Prime Rate.
The principal of this Note is subject to mandatory prepayments, as
follows: (i) if the aggregate principal amount of the Loans outstanding exceeds
the Available Facility at any time, such excess shall be immediately due and
payable and (ii) the principal of this Note shall be due and payable in full on
the Maturity Date and, if earlier, the date on which the Loans become due,
whether by virtue of demand, acceleration or otherwise. This Note may be
voluntarily prepaid in whole or in part at any time, without premium or penalty;
provided, however that each prepayment of principal shall be in an amount equal
to, or greater than, $1,000.00 or, if less, the outstanding balance of this
Note.
If any payment is not made within ten (10) days after the date due,
the Borrower shall pay the Bank an amount equal to five percent (5%) of such
payment or $50.00, whichever is greater.
An "Event of Default" as described in the Loan Agreement shall
constitute an Event of Default hereunder. Upon the occurrence of an Event of
Default, the Bank shall have all rights and remedies provided herein, in the
Loan Agreement and otherwise available at law or in equity. At the option of the
Bank, upon the occurrence and during the continuance of any Event of Default,
this Note shall bear interest (computed and adjusted in the same manner, and
with the same effect, as interest prior to the occurrence of such Event of
Default) payable on demand at a rate equal to three percent (3%) per annum in
excess of the otherwise applicable rate.
All payments of principal and interest hereunder shall be made in
immediately available funds to the Bank at 000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx
00000, M.L. CN-OH-W6TC, or at such other place as may be designated by the
holder hereof to the Borrower in writing. The Borrower authorizes the Bank to
charge any account, in the name of the Fund, or charge or increase any loan
balance of the Borrower at the Bank for the amount of any interest or principal
payments due to the Bank hereunder. The Bank is further authorized by the
Borrower to enter from time to time the balance of this Note and all payments
thereon on the reverse of this Note or in the Bank's regularly maintained data
processing records, and the aggregate unpaid amount set forth thereon or therein
shall be presumptive evidence of the amount owing to the Bank and unpaid on this
Note, absent manifest error.
If any term or condition of this Note conflicts with the express
terms or conditions of the Loan Agreement, the terms and conditions of the Loan
Agreement shall control. Terms used but not defined herein shall have the same
meanings herein as in the Loan Agreement.
IMPORTANT: This Note shall be deemed made in Ohio and shall in all
respects be governed by and construed in accordance with the laws of the State
of Ohio, including all matters of construction, validity and performance.
Without limitation on the ability of the Bank to initiate and
prosecute any action or proceeding in any applicable jurisdiction related to
loan repayment, the Borrower and the Bank agree that any action or proceeding
commenced by or on behalf of the parties arising out of or relating to this Note
shall be commenced and maintained exclusively in the United States District
Court for the Southern District of Ohio, or any other court of applicable
jurisdiction located in Cincinnati, Ohio. The Borrower and the Bank also agree
that a summons and complaint commencing an action or proceeding in any such Ohio
courts by or on behalf of such parties shall be properly served and shall confer
personal jurisdiction on a party to which said party consents, if (i) served
personally or by registered or certified mail to the other party at any of its
addresses noted herein, or (ii) as otherwise provided under the laws of the
State of Ohio. The Borrower and the Bank hereby waive all rights to trial by
jury in any proceeding arising out of or related to this Note. The interest rate
and all other terms of this Note negotiated with the Borrower are, in part,
related to the aforesaid provisions on jurisdiction, which the Bank deems a
vital part of this loan arrangement.
Presentment for payment, notice of dishonor, protest, demand, notice
of protest and all other notices are hereby waived.
Borrower hereby irrevocably authorizes and empowers any
attorney-at-law to appear for Borrower in any action upon or in connection with
this Agreement at any time after the Loans and/or other obligations of Borrower
evidenced hereby become due, as herein provided, in any court in or of the State
of Ohio or elsewhere, and waives the issuance and service of process with
respect thereto, and irrevocably authorizes and empowers any such
attorney-at-law to confess judgment in favor of Bank against Borrower in the
amount due thereon or hereon, plus interest as herein provided, and all costs of
collection, and waives and releases all errors in any said proceedings and
judgments and all rights of appeal from the judgment rendered. The Borrower
agrees and consents that the attorney confessing judgment on behalf of the
Borrower hereunder may also be counsel to the Bank and/or the Bank's affiliates,
and the Borrower hereby further waives any conflict of interest which might
otherwise arise and consents to the Bank paying such confessing attorney a legal
fee or allowing such attorneys' fees to be paid from proceeds of collection of
this Agreement and/or any and all collateral and security for the Loans and
obligations.
WARNING--BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU
WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT
FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE BANK.
Xxxxxxxx Xxxxx Funds, Inc.
By: _____________________________________
Name: Xxxx X. Xxxxxxxx
Title: Chairman & Secretary
OFFICER'S CERTIFICATE
Xxxxxxxx Xxxxx Funds, Inc., a corporation is entering into and/or
continuing a loan transaction with U.S. BANK N.A. (the "Bank") pursuant to a
loan agreement effective as of even date herewith (the "Loan Agreement"). In
that connection, the undersigned certifies:
1. Attached hereto as Schedule 1 is a true copy of the Articles of
Incorporation of Borrower on file in the office of the Secretary of State of
Wisconsin which has not been modified, rescinded or superceded and remains in
full force and effect as of the date hereof.
2. Attached hereto as Schedule 2 is a true copy of the duly adopted
By-Laws of Borrower, which has not been modified, rescinded or superceded and
remains in full force and effect as of the date hereof.
3. Attached hereto as Schedule 3 are true copies of certain
resolutions authorizing the loan transactions which were duly adopted by the
Board of Directors of Borrower, and which have not been amended, rescinded or
superceded and remain in full force and effect as of the date hereof.
4. Borrower is not a party to any agreement that adversely affects,
or would be violated by its entering into, the loan transactions and any
document or instrument related thereto.
5. The execution and delivery of such loan facility documents (A)
does not violate or constitute on the part of Borrower a breach or default under
(i) any applicable provision of statutory law or regulations, (ii) any order,
judgment or decree of any court, governmental agency or authority, or (iii) any
agreement with any third party, and (B) does not require the approval or consent
of any governmental body or other person.
6. No Event of Default (as defined in Section 7 of the Loan
Agreement) or any event which, with the passage of time or the giving of notice,
might mature into an Event of Default has occurred or is continuing as of the
date hereof.
7. The representations and warranties in Section 4 of the Loan
Agreement are true and correct in all material respects as of the date hereof
(except for those limited to or expressed only as of a prior specific date).
8. The persons listed below are all the duly elected officers or
Borrower and each is authorized to execute on behalf of Borrower and deliver to
the Bank all documents and instruments described in the aforesaid resolutions of
the Borrower and in Section 6(a)(i) of the Loan Agreement.
NAME TITLE SIGNATURE
___________________ _______________ ____________________
___________________ _______________ ____________________
___________________ _______________ ____________________
___________________ _______________ ____________________
Dated as of ____________, 20___
BORROWER:
XXXXXXXX PLUMB FUNDS, INC.
By: _____________________________________
Name: Xxxx X. Xxxxxxxx
Title: Chairman & Secretary
2
November 1, 2004
Xx. Xxxx X. Xxxxxxxx
Chairman & Secretary
Xxxxxxxx Xxxxx Funds
1200 Xxxx X. Xxxxxxx Xxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxxxx 00000
Re: THE LOAN AGREEMENT, AS AMENDED, RESTATED, SUPPLEMENTED OR OTHERWISE
MODIFIED FROM TIME TO TIME (THE "AGREEMENT"), DATED AS OF OCTOBER 1, 2004,
BY AND BETWEEN XXXXXXXX XXXXX FUNDS, INC., FOR THE BENEFIT OF THE XXXXXXXX
PLUMB GROWTH FUND (THE "BORROWER"), AND U.S. BANK, N.A. (THE "BANK").
Dear Xx. Xxxxxxxx:
This letter (the "First Amendment") when duly and validly executed by the
Borrower shall amend the above referenced Agreement, effective as of November
15, 2004, such that:
The Maturity Date shall be defined as November 15, 2005.
As a condition to the effectiveness of the First Amendment, the Borrower
shall deliver to the Bank a duly and validly executed revolving promissory note
(the "Amended Note") substantially in the form of Exhibit A hereto. The Amended
Note shall replace and restate the Note referenced in the Agreement.
Except as modified above, all other representations, warranties,
covenants, terms, and conditions set forth in the Loan Agreement shall remain in
full force and effect. Capitalized terms used herein shall have the same
meanings as defined in the Loan Agreement.
If the above terms represent our understanding, please indicate your
agreement by signing below and returning one copy of the First Amendment along
with the promissory note to me.
Sincerely,
Xxxxxx X. Xxxxx
Assistant Vice President
Accepted this _______ day of November, 2004.
BORROWER: XXXXXXXX XXXXX FUNDS, INC.
By: _______________________________
Name: Xxxx X. Xxxxxxxx Title: Chairman & Secretary
EXHIBIT A
PROMISSORY NOTE
$20,000,000 Cincinnati, Ohio
November 15, 2004
Xxxxxxxx Xxxxx Funds, Inc., a Wisconsin corporation (the
"Borrower"), for value received, hereby promises to pay to the order of U.S.
BANK N.A. (the "Bank"), or its successors or assigns, on or before November 15,
2005 (the "Maturity Date"), the principal sum of Twenty Million Dollars
($20,000,000.00), or such portion thereof as may be outstanding from time to
time as a Loan under the hereinafter-described Loan Agreement, together with
interest thereon as hereinafter provided.
This Note is the "Note" to which reference is made in the Loan
Agreement dated as of October 1, 2004 with respect to the Xxxxxxxx Plumb Growth
Fund (the "Fund") between the Borrower and the Bank (as amended, supplemented or
otherwise modified from time to time, the "Loan Agreement") and is subject to
the terms and conditions thereof, including without limitation the terms thereof
providing for acceleration of maturity of the loans made by the Bank to the
Borrower under the Loan Agreement and evidenced by this Note (the "Loans").
This Note shall bear interest at a rate per annum equal to Prime,
which interest shall be payable to the Bank (i) monthly, in arrears, commencing
on November 1, 2004 and on the first day of each month thereafter, (ii) whenever
all or any part of the Loans are due and payable, whether on the Maturity Date,
by virtue of a mandatory prepayment, or by reason of demand, acceleration or
otherwise (on the amount so due and payable) and (iii) whenever the Borrower
repays all of the Loans as a voluntary prepayment. Interest on this Note shall
be computed on the basis of a year consisting of three hundred sixty (360) days
but applied to the actual number of days elapsed.
As used herein, the term "Prime Rate" shall mean the rate which the
Bank announces as its prime lending rate, as in effect from time to time. The
Prime Rate is determined solely by the Bank pursuant to market factors and its
own operating needs and does not necessarily represent the lowest or best rate
actually charged to any customer. The Bank may make commercial or other loans at
rates of interest at, above or below the Prime Rate.
The principal of this Note is subject to mandatory prepayments, as
follows: (i) if the aggregate principal amount of the Loans outstanding exceeds
the Available Facility at any time, such excess shall be immediately due and
payable and (ii) the principal of this Note shall be due and payable in full on
the Maturity Date and, if earlier, the date on which the Loans become due,
whether by virtue of demand, acceleration or otherwise. This Note may be
voluntarily prepaid in whole or in part at any time, without premium or penalty;
provided, however that each prepayment of principal shall be in an amount equal
to, or greater than, $1,000.00 or, if less, the outstanding balance of this
Note.
If any payment is not made within ten (10) days after the date due,
the Borrower shall pay the Bank an amount equal to five percent (5%) of such
payment or $50.00, whichever is greater.
An "Event of Default" as described in the Loan Agreement shall
constitute an Event of Default hereunder. Upon the occurrence of an Event of
Default, the Bank shall have all rights and remedies provided herein, in the
Loan Agreement and otherwise available at law or in equity. At the option of the
Bank, upon the occurrence and during the continuance of any Event of Default,
this Note shall bear interest (computed and adjusted in the same manner, and
with the same effect, as interest prior to the occurrence of such Event of
Default) payable on demand at a rate equal to three percent (3%) per annum in
excess of the otherwise applicable rate.
All payments of principal and interest hereunder shall be made in
immediately available funds to the Bank at 000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx
00000, M.L. CN-OH-W6TC, or at such other place as may be designated by the
holder hereof to the Borrower in writing. The Borrower authorizes the Bank to
charge any account, in the name of the Fund, or charge or increase any loan
balance of the Borrower at the Bank for the amount of any interest or principal
payments due to the Bank hereunder. The Bank is further authorized by the
Borrower to enter from time to time the balance of this Note and all payments
thereon on the reverse of this Note or in the Bank's regularly maintained data
processing records, and the aggregate unpaid amount set forth thereon or therein
shall be presumptive evidence of the amount owing to the Bank and unpaid on this
Note, absent manifest error.
If any term or condition of this Note conflicts with the express
terms or conditions of the Loan Agreement, the terms and conditions of the Loan
Agreement shall control. Terms used but not defined herein shall have the same
meanings herein as in the Loan Agreement.
IMPORTANT: This Note shall be deemed made in Ohio and shall in all
respects be governed by and construed in accordance with the laws of the State
of Ohio, including all matters of construction, validity and performance.
Without limitation on the ability of the Bank to initiate and
prosecute any action or proceeding in any applicable jurisdiction related to
loan repayment, the Borrower and the Bank agree that any action or proceeding
commenced by or on behalf of the parties arising out of or relating to this Note
shall be commenced and maintained exclusively in the United States District
Court for the Southern District of Ohio, or any other court of applicable
jurisdiction located in Cincinnati, Ohio. The Borrower and the Bank also agree
that a summons and complaint commencing an action or proceeding in any such Ohio
courts by or on behalf of such parties shall be properly served and shall confer
personal jurisdiction on a party to which said party consents, if (i) served
personally or by registered or certified mail to the other party at any of its
addresses noted herein, or (ii) as otherwise provided under the laws of the
State of Ohio. The Borrower and the Bank hereby waive all rights to trial by
jury in any proceeding arising out of or related to this Note. The interest rate
and all other terms of this Note negotiated with the Borrower are, in part,
related to the aforesaid provisions on jurisdiction, which the Bank deems a
vital part of this loan arrangement.
Presentment for payment, notice of dishonor, protest, demand, notice
of protest and all other notices are hereby waived.
Borrower hereby irrevocably authorizes and empowers any
attorney-at-law to appear for Borrower in any action upon or in connection with
this Agreement at any time after the Loans and/or other obligations of Borrower
evidenced hereby become due, as herein provided, in any court in or of the State
of Ohio or elsewhere, and waives the issuance and service of process with
respect thereto, and irrevocably authorizes and empowers any such
attorney-at-law to confess judgment in favor of Bank against Borrower in the
amount due thereon or hereon, plus interest as herein provided, and all costs of
collection, and waives and releases all errors in any said proceedings and
judgments and all rights of appeal from the judgment rendered. The Borrower
agrees and consents that the attorney confessing judgment on behalf of the
Borrower hereunder may also be counsel to the Bank and/or the Bank's affiliates,
and the Borrower hereby further waives any conflict of interest which might
otherwise arise and consents to the Bank paying such confessing attorney a legal
fee or allowing such attorneys' fees to be paid from proceeds of collection of
this Agreement and/or any and all collateral and security for the Loans and
obligations.
WARNING--BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU
WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT
FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE BANK.
Xxxxxxxx Xxxxx Funds, Inc.
By: _____________________________________
Name: Xxxx X. Xxxxxxxx
Title: Chairman & Secretary
LOAN AGREEMENT
This LOAN AGREEMENT (as amended, restated, supplemented or otherwise
modified from time to time, the "Agreement") is made and entered into as of the
1st day of October, 2004 by and between, Xxxxxxxx Xxxxx Funds, Inc. a
corporation with its address at 1200 Xxxx X. Xxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxxx
00000 (the "Borrower"), and U.S. BANK N.A., with its address at 000 Xxxxxx
Xxxxxx, Xxxxxxxxxx, Xxxx 00000 (the "Bank").
1. (a)Definitions. The following terms shall have the meanings specified
below:
"Act" shall mean the Investment Company Act of 1940, as amended.
"AMEX Securities" shall mean securities issued by an entity
organized in one of the states of the United States or the District of Columbia
which are listed for trading and actively traded on the American Stock Exchange.
"Applicable Law" shall mean and include laws, statutes, ordinances,
and rules and regulations thereunder, and interpretations thereof by any
Governmental Authority charged with the administration or the interpretation
thereof, common law and orders, requests, directives, instructions and notices
of any Governmental Authority having the force of law.
"Authorized Officer" shall have the meaning set forth in Section
6(a)(i)(C).
"Available Facility" shall mean at any time, the lesser of (i)
$1,000,000, (ii) 5% of the Net Assets of the Fund, (iii) 5% of the market value
of the assets of the Fund which are recorded on the Borrower's books and records
as belonging to the Fund, which are held by the Custodian and (iv) 5% of the sum
of the market value of the following assets of the Fund: (A) NYSE Securities,
(B) AMEX Securities, (C) Nasdaq Securities, (D) debt issues of the United States
government or any of its agencies, (E) debt issues with a Xxxxx'x Investors
Service, Inc. rating of no less than BBB, (F) preferred stocks with a Standard &
Poor's Rating Service or Xxxxx'x Investors Service, Inc. rating of A or higher,
in each case which are recorded on the Borrower's books and records as belonging
to the Fund, which are held by the Custodian and (G) other assets of the Fund
which are expressly approved in writing by the Bank in its sole discretion.
"Bank" shall have the meaning set forth in the preamble.
"Borrower" shall have the meaning set forth in the preamble.
"Business Day" shall mean any day excluding Saturday, Sunday and any
day on which banking institutions in the State of Ohio are authorized or
required by law or other government actions to close.
"Custodian" shall mean the Bank, as custodian, pursuant to the
Custody Agreement.
"Custody Agreement" shall mean that certain Custody Agreement dated
February 7, 1992 between the Borrower and the Bank, as it may be amended,
restated, modified or supplemented from time to time.
"Default" shall mean any event, act or condition which with notice
or lapse of time, or both, would constitute an Event of Default.
"Effective Date" shall have the meaning set forth in Section 6(a).
"Event of Default" shall have the meaning set forth in Section 7.
"Fund" shall mean the Series known as the Xxxxxxxx Xxxxx Bond Fund.
"Fund Statement" shall mean the Borrower's Statement of Additional
Information dated April 1, 2004, as supplemented and amended from time to time,
relating to the Xxxxxxxx Plumb Bond Fund and the other Series of the Borrower.
"GAAP" shall mean generally accepted accounting principles in the
United States consistently applied in accordance with past practices.
"Governmental Authority" shall mean any foreign, federal, state,
regional, local, municipal or other government, or any department, commission,
board, bureau, agency, public authority or instrumentality thereof, or any
court.
"Indebtedness" of any person shall mean all of the obligations of
such person which, in accordance with GAAP, would be included as liabilities on
the balance sheet of such person including, without limitation, (i) any
indebtedness, obligation or liability of any kind or nature whatsoever and (ii)
any guarantee, indemnity, endorsement, suretyship or other contingent obligation
of any kind or nature whatsoever in respect of the obligations of another
person.
"Investment" shall mean, when used with respect to any person, any
direct or indirect purchase or other acquisition by such person of a beneficial
interest in capital stock, bonds, notes, debentures or other securities issued
by any other person or any direct or indirect advance, loan or other extension
of credit or capital contribution by such person to any other person.
"Lien" shall mean any mortgage, pledge, security interest, charge,
hypothecation, collateral assignment, deposit arrangement, encumbrance, lien
(statutory or other), or other security agreement of any kind or nature
whatsoever.
"Loan" and "Loans" shall have the meaning set forth in Section 2(a).
"Loan Documents" shall mean this Agreement, the Note and all other
documents and instruments executed in connection herewith and with the Loans.
"Maturity Date" shall mean November 15, 2004.
"Nasdaq Securities" shall mean securities issued by an entity
organized in one of the states of the United States or the District of Columbia
which are listed for trading, and actively traded, on the Nasdaq Stock Market.
2
"Net Assets" shall mean from time to time, the net assets of the
Fund, calculated by taking the sum of the value of the Fund's securities plus
any cash and other assets (including dividends and interest accrued but not
collected) less all liabilities, including accrued expenses, allocable to the
Fund.
"Note" shall have the meaning set forth in Section 2(b).
"NYSE Securities" shall mean securities issued by an entity
organized in one of the states of the United States or the District of Columbia
which are listed for trading, and actively traded, on the New York Stock
Exchange.
"Obligations" shall mean all of the Borrower's liabilities,
obligations and indebtedness to the Bank hereunder, under the Note and the other
Loan Documents, or otherwise incurred in connection with the Fund, whether
heretofore, now or hereafter arising and howsoever evidenced, whether primary,
secondary, contingent or fixed or arising under oral or written agreement or by
operation of law.
"Officer's Certificate" shall mean a certificate signed in the name
of the Borrower by an Authorized Officer containing the information noted in
Section 6(a)(i) hereof, and any amendment and/or restatement of same.
"Permitted Indebtedness" shall mean (i) liabilities incurred in the
ordinary course of business which are not past due (except for those taxes which
are being contested in good faith by appropriate proceedings and for which
adequate reserves in conformity with GAAP have been provided), (ii) liabilities
the Borrower is permitted to incur on behalf of the Fund under the Fund
Statement or the Prospectus, (iii) the Obligations, (iv) other obligations,
liabilities and indebtedness owed by the Borrower to the Bank.
"Prime Rate" shall mean the rate which the Bank announces as its
prime lending rate, as in effect from time to time. The Prime Rate is determined
solely by the Bank pursuant to market factors and its own operating needs and
does not necessarily represent the lowest or best rate actually charged to any
customer. The Bank may make commercial or other loans at rates of interest at,
above or below the Prime Rate.
"Prospectus" shall mean the Prospectus of the Borrower dated April
1, 2004, for its Xxxxxxxx Xxxxx Bond Fund, as amended and supplemented from time
to time (including, as fully as if it were set forth therein, the Fund
Statement).
"Requirement of Law" as to any person shall mean the articles or
certificate of incorporation and bylaws or other organizational or governing
documents of such person and any law, treaty, rule or regulation or
determination of an arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such person or any of its property or to
which such person or any of its property is subject.
"Series" shall mean a separate series established by the Borrower's
board of directors pursuant to the articles of incorporation.
3
(b) General Provisions Relating to Definitions. Terms for which
meanings are defined in this Agreement shall apply equally to the singular and
plural forms of the terms defined. Whenever the context may require, any pronoun
shall include the corresponding masculine, feminine and neuter forms. The term
"including" means including, without limiting the generality of any description
preceding such term. Each reference herein to any person shall include a
reference to such person's permitted successors and assigns.
(c) Cross-References. Unless otherwise specified, references in this
Agreement and in each Loan Document to any Section are references to such
Section of this Agreement or such Loan Document, as the case may be, and unless
otherwise specified, references in any Section or definition to any clause are
references to such clause of such Section or definition.
2. Loans Facility.
(a) Loans. Subject to the terms and conditions set forth herein, and
subject to the satisfaction of the conditions set forth in Section 6 hereof, the
Bank may, in its sole discretion, lend and relend to the Borrower for the
account and benefit of the Fund, during the period from the Effective Date to
the earlier of (i) the Maturity Date (or the date of any extension of this
Agreement in a writing signed by the Bank) or (ii) the date of the occurrence of
an Event of Default, unless waived in a writing signed by the Bank, such amounts
as the Borrower may from time to time request (each individually a "Loan" and
collectively, the "Loans") up to an aggregate principal amount outstanding at
any time not to exceed the amount of the Available Facility. The proceeds of
Loans may only be used by the Fund for short term liquidity in connection with
shareholder redemptions permitted under the Fund Statement and the Prospectus.
This Agreement does not establish a commitment or obligation of the
Bank to lend money to the Borrower. The decision of whether or not to make any
Loan shall be made by the Bank in its sole and absolute discretion.
(b) Note. The Loans shall be evidenced by a promissory note given by
Borrower to the Bank, in the form of Exhibit A attached hereto and made a part
hereof (as such note may be extended, amended, restated, supplemented or
otherwise modified from time to time, and together with any one or more notes
which may be issued in exchange for such note, the "Note"). The Bank is hereby
authorized by Borrower to enter from time to time the principal balance of the
Loans and all payments and prepayments thereon on the reverse of the Note or in
the Bank's regularly maintained data processing records, and the aggregate
unpaid amount of the Loan set forth thereon or therein shall be presumptive
evidence of the principal amount owing to the Bank and unpaid thereon, absent
manifest error. Upon written request of the Bank, Borrower shall immediately
exchange its Note then outstanding for a revised and updated Note. The Borrower
further authorizes the Bank to charge any account of the Borrower, in the name
of the Fund, at the Bank or charge or increase any loan balance of the Borrower
for the amount of any payments due to the Bank hereunder.
4
(c) Loan Requests. The Borrower shall notify, by written notice in
the form attached hereto as Exhibit B (each such notice, a "Loan Request"), such
person at the Bank as the Bank may, from time to time, instruct the Borrower, by
2:00 p.m. (Eastern Time) on each day on which the Borrower desires to obtain a
Loan hereunder, which day must be a Business Day, specifying the amount of the
Loan desired. Notwithstanding the foregoing sentence, the Borrower may verbally
request Loan hereunder, provided that the Borrower shall, on the same day, send
the Bank by telecopy a follow-up Loan Request in respect thereof. In no event
shall the Borrower request any loan which, if advanced, would cause the
aggregate principal amount of the Loans outstanding to exceed the Available
Facility. Each verbal request for a Loan hereunder shall be deemed to include,
and each written request shall include, a representation that all of the
representations and warranties made by the Borrower in the Loan Documents are
and will be, after giving effect to the requested Loan, true and complete, that
all the conditions precedent to such Loan as set forth in Section 6 hereof have
been satisfied, and that the proceeds of the Loan will not be used for any
purpose that is not permitted hereunder. Each advance of Loan proceeds hereunder
shall be in a minimum amount of $1,000.00.
(d) Disbursement of Funds. Each Loan shall be effectuated by the
Bank crediting an account number maintained by the Bank.
(e) Interest.
(i) The Borrower shall pay interest on the outstanding
principal balance of the Loans at a rate per annum equal to Prime, which
interest shall be payable (A) monthly, in arrears, commencing on November 1,
2004 and on the first day of each month thereafter, (B) whenever all or any part
of the Loans are due, whether on the Maturity Date, by virtue of a mandatory
prepayment, or by reason of demand, acceleration or otherwise (on the amount
then due) and (C) whenever the Borrower repays all of the Loans as a voluntary
prepayment.
(ii) Upon the occurrence and during the continuance of any
Event of Default hereunder, at the option of the Bank, the Loans and other
Obligations of the Borrower to the Bank shall bear interest (computed and
adjusted in the same manner, and with the same effect, as interest on the Loans
prior to the occurrence of such Event of Default) payable on demand at a rate
equal to three percent (3%) per annum in excess of the otherwise applicable
rate.
(iii) Interest on the Loans shall be computed on the basis of
a year consisting of three hundred sixty (360) days but applied to the actual
number of days elapsed.
(iv) If any payment is not made within ten (10) days after the
date due, the Borrower shall pay the Bank an amount equal to five percent (5%)
of such payment or $50.00, whichever is greater.
(f) Maximum Outstanding Period. Notwithstanding anything herein to
the contrary, no Loan draw shall be outstanding for more than forty-five (45)
days.
Payments.
5
(a) Mandatory Prepayments.
(i) The Borrower agrees that if the aggregate principal amount
of Loans outstanding exceeds the Available Facility at any time, such excess
shall be immediately due and payable to the Bank.
(ii) The Borrower agrees to repay the Loans in full in cash
together with interest accrued thereon and any other fees and charges hereunder
on the Maturity Date and, if earlier, the date on which the Loans become due,
whether by virtue of a mandatory prepayment provision, by demand, acceleration
or otherwise.
(b) Voluntary Prepayments. The Borrower may prepay a Loan in whole
or in part from time to time; provided, however, that each prepayment shall be
in an amount equal to, or greater than, $1000.00 or, if less, the outstanding
balance of such Loan, and shall be made with interest accrued thereon.
(c) Increased Costs.
(i) If the adoption of or any change in any Requirement of Law
or in the interpretation or application thereof or compliance by the Bank with
any request or directive (whether or not having the force of law) from any
Governmental Authority made subsequent to the Effective Date shall subject the
Bank to any tax of any kind whatsoever with respect to this Agreement, the Note
or any Loan made by it, or change the basis of taxation of payments to the Bank
in respect thereof and the result is to increase the cost to the Bank, by an
amount which the Bank deems to be material, of making or maintaining the Loans,
or to reduce any amount receivable hereunder in respect thereof, then the
Borrower shall promptly pay the Bank, upon its demand, any additional amounts
necessary to compensate the Bank for such increased cost or reduced amount
receivable.
(ii) If the Bank shall have determined that the adoption of or
any change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by the Bank or any
corporation controlling the Bank with any request or directive regarding capital
adequacy (whether or not having the force of law) from any Governmental
Authority made subsequent to the Effective Date shall have the effect of
reducing the rate of return on the Bank's or such corporation's capital as a
consequence of its obligations hereunder to a level below that which the Bank or
such corporation could have achieved but for such adoption, change or compliance
(taking into consideration the Bank's or such corporation's policies with
respect to capital adequacy) by an amount deemed by the Bank to be material,
then from time to time, after submission by the Bank to the Borrower of a
written request therefor, the Borrower shall pay to the Bank such additional
amount or amounts as will compensate the Bank for such reduction.
(iii) A certificate as to any amounts payable pursuant to this
subsection (c) submitted by the Bank to the Borrower shall be conclusive in the
absence of manifest error.
6
(d) Taxes. All payments made by the Borrower under this Agreement
and the Note shall be made free and clear of, and without deduction or
withholding for or on account of, any present or future income, stamp or other
taxes imposed, levied, collected, withheld or assessed by any Governmental
Authority, excluding net income taxes and franchise taxes (imposed in lieu of
net income taxes). If any such non-excluded taxes, levies, imposts, duties,
charges, fees, deductions or withholdings ("Non-Excluded Taxes") are required to
be withheld from any amounts payable to the Bank hereunder or under the Note,
such amounts shall be increased to the extent necessary to yield to the Bank
(after payment of all Non-Excluded Taxes) interest or any such other amounts
payable hereunder at the rates or in the amounts specified in this Agreement and
the Note. Whenever any Non-Excluded Taxes are payable by the Borrower, as
promptly as possible thereafter the Borrower shall send to the Bank a certified
copy of an original official receipt received by the Borrower showing payment
thereof. If the Borrower fails to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fails to remit to the Bank the required receipts
or other required documentary evidence, the Borrower shall indemnify the Bank
for any incremental taxes, interest or penalties that may become payable by the
Bank as a result of any such failure.
(e) Place of Payment. All payments of principal and interest
hereunder shall be made in immediately available funds to the Bank at 000 Xxxxxx
Xxxxxx, Xxxxxxxxxx, Xxxx 00000, M.L. CN-OH-W6TC, or at such other place as may
be designated by the Bank to the Borrower in writing.
(f) Business Day Payments. Whenever any of the terms and provisions
of this Agreement or the other Loan documents provides that any payment to be
made shall be due on a day which is not a Business Day, such payment shall be
made on the next succeeding Business Day and such extension of time shall be
included in computing interest, if any, in connection with such payment.
3. Representations and Warranties. To induce the Bank to enter into
this Agreement, the Borrower represents and warrants to the Bank as follows:
(a) Existence. The Borrower is duly organized, validly existing and
in active status as a corporation under the laws of Wisconsin and is registered
as an investment company under the Act.
(b) Authority. The Borrower has full power and authority to own its
properties and to conduct its business as an investment company and to execute,
deliver and perform its obligations under this Agreement and the other Loan
Documents.
(c) Borrowing Authorization. The execution, delivery and performance
by the Borrower of this Agreement and the other Loan Documents: (i) have been
duly authorized by all requisite action; (ii) do not and will not violate (A)
any law, regulation, order, writ, judgment, decree, determination or award
currently in effect and applicable to the Borrower, (B) the articles of
incorporation, declaration of trust or bylaws or other organizational or
governing documents of the Borrower, (C) any provision of any agreement to which
the Borrower is a party, or by which it or any of its properties or
7
assets is bound, and (D) any franchise, license, permit, certificate,
authorization, qualification, accreditation or other similar right, consent or
approval of or applicable to the Borrower; and (iii) do not and will not result
in the creation or imposition of any Lien upon any of the properties or assets
of the Borrower. No consents, licenses, permits, applications or authorizations
of, notices or reports to, or registrations, filings or declarations with, any
Governmental Authority or other third party are required to be obtained in
connection with the execution, delivery or performance by the Borrower of any of
the Loan Documents.
(d) Enforceability. This Agreement and the other Loan Documents have
been duly executed and delivered by the Borrower, pursuant to due authorization,
and constitute the legal, valid and binding obligations of the Borrower,
enforceable against the Borrower in accordance with their terms.
(e) Financial Information; Adverse Change. The Borrower has
provided, or prior to the Effective Date will provide, the Bank with (i) its
audited financial statements for its fiscal year ended November 30, 2003 and
(ii) the Prospectus. The Borrower does not have any contingent liabilities not
provided for or disclosed in such financial statements. Such financial
statements present fairly, in all respects, the financial condition of the
Borrower in accordance with GAAP. There has been no material adverse change in
the business or financial condition of the Borrower since the date of such
financial statements.
(f) Indebtedness. The Borrower has no Indebtedness other than
Permitted Indebtedness.
(g) Investments. None of the Borrower's Series, including the Fund,
has Investments which such Series is not authorized to have or which are
inconsistent with or conflict with the provisions of the Prospectus relating to
such Series and the Borrower generally or for which it or the Borrower is
required to obtain shareholder approval.
(h) Litigation. There is no litigation or other action or proceeding
pending or, to the best of the knowledge of the Borrower after diligent
investigation, threatened against or affecting the Borrower or any of its Series
before any Governmental Authority.
(i) Title to Property. The Borrower (or, to the extent applicable,
each Series) has good, indefeasible and merchantable title to and ownership of
all of its assets free and clear of all Liens.
(j) Compliance. The Borrower is in compliance with the Act and all
other Applicable Laws.
(k) No Default. No default (or event which, with notice or lapse of
time, or both, would constitute a default) exists under any agreement or
instrument to which the Borrower is a party or pursuant to which any property of
the Borrower is encumbered.
8
(l) Taxes. The Borrower has filed all federal, state and local tax
returns and other reports which it is required by law to file, has paid all
taxes, assessments and other similar charges that are due and payable, except to
the extent that any such taxes or charges are being contested in good faith by
appropriate proceedings and for which adequate reserves in accordance with GAAP
have been set aside on its books and records, and has withheld all employee and
similar taxes which it is required by law to withhold.
(m) Licenses, Etc. The Borrower has obtained and holds in full force
and effect, all franchises, licenses, permits, certificates, authorizations,
qualifications, accreditations, and other consents, rights and approvals which
are necessary for the operation of its business. The Borrower is not in
violation of the terms of any such franchise, license, permit, certificate,
authorization, qualification, accreditation, consent, right or approval.
(n) Broker's Fees. No brokerage, finder's or similar fee or
commission is due to any party by reason of the Borrower entering into this
Agreement or by reason of any of the transactions contemplated hereby, and the
Borrower shall indemnify and hold the Bank harmless from all such fees and
commissions.
4. Borrower's Covenants. The Borrower agrees with the Bank that,
from the date of this Agreement and until the Loans are paid in full and all
obligations under this Agreement and the other Loan Documents are fully
performed and this Agreement has been terminated:
(a) Books and Records; Inspection. The Borrower shall keep and
maintain complete books, records and files with respect to its business in
accordance with GAAP and shall accurately and completely record all transactions
therein. The Borrower shall permit the officers, employees and designated
representatives of the Bank, from time to time to inspect the Borrower's
property and to inspect and make copies of or extracts from the books, records
and files of the Borrower, and the Borrower shall make the same available to the
Bank and its agents and representatives for such purposes at such reasonable
times as the Bank shall request.
(b) Financial Statements; Reports. The Borrower shall furnish to the
Bank: (i) within one hundred twenty (120) days after the last day of each fiscal
year of the Borrower, a copy of the annual audit report of the Borrower prepared
in accordance with GAAP, with detail reasonably satisfactory to the Bank, and
consisting of at least a statement of assets and liabilities for each of the
Series (including the Fund) as at the close of such fiscal year, a Schedule of
Investments for each of the Series (including the Fund) as at the close of such
fiscal year, a statement of operations for each of the Series (including the
Fund) for such fiscal year and a statement of changes in net assets for each of
the Series (including the Fund) for such fiscal year, and certified by an
independent certified public accountant satisfactory to the Bank; (ii)
statements of the Borrower's and the Fund's Net Assets and the market value of
the assets of each Series (including the Fund) of the Borrower, whether or not
held by the Custodian, on a daily basis whenever any Loans are outstanding
hereunder and otherwise upon the Bank's request; (iii) promptly upon
transmission thereof, copies of all regular and
9
periodic financial information, proxy materials and other information and
reports, if any, which the Borrower shall file with the Securities and Exchange
Commission or any governmental agencies substituted therefor or which the
Borrower shall send to its shareholders generally; and (iv) such other reports
and information as the Bank may reasonably request from time to time.
(c) Taxes. The Borrower shall file all federal, state and local tax
returns and other reports the Borrower is required by law to file, and shall pay
when due all taxes, assessments and other liabilities except for those contested
in good faith by appropriate proceedings for which adequate reserves in
conformity with GAAP will be provided and shall withhold all employee and
similar taxes which it is required by law to withhold.
(d) Existence and Status. The Borrower shall maintain its existence
as a corporation in active status under the laws of Wisconsin, shall continue to
be registered as an investment company under the Act and shall continue to
maintain the Fund as a separate Series of the Borrower.
(e) Compliance with Law. The Borrower shall comply at all times with
the Act and all other Applicable Laws.
(f) Borrower's Coverage Ratio. The Borrower shall not permit the
ratio of its (i) total assets minus total liabilities (other than liabilities of
any kind or nature whatsoever for borrowed money and liabilities in respect of
overdrafts in any account (whether trust, demand deposit or other account)
maintained by the Borrower) to (ii) total liabilities of any kind or nature
whatsoever for borrowed money and liabilities in respect of overdrafts in any
account (whether trust, demand deposit or other account) maintained by the
Borrower to be less than 300% at any time.
(g) Fund's Coverage Ratio. The Borrower shall not permit the ratio
of the Fund's (i) total assets minus total liabilities (other than liabilities
of any kind or nature whatsoever for borrowed money and the Fund liabilities in
respect of overdrafts in any account (whether trust, demand deposit or other
account) maintained by the Borrower on behalf of the Fund) to (ii) total
liabilities of any kind or nature whatsoever for borrowed money and the Fund's
liabilities in respect of overdrafts in any account (whether trust, demand
deposit or other account) maintained by the Borrower on behalf of the Fund to be
less than 300% at any time.
(h) Licenses. The Borrower shall obtain and maintain all franchises,
licenses, permits, certificates, authorizations, qualifications, accreditations,
and other consents, rights and approvals which are required by law or are
necessary for the operation of its business.
(i) Notice. The Borrower shall notify the Bank in writing, promptly
upon the Borrower's learning thereof, of: (i) any material litigation, suit or
administrative proceeding which may affect the operations, financial condition
or business of the Borrower or the Bank's interest in any of the Collateral;
(ii) any default by the Borrower under any note, indenture, loan agreement,
mortgage, lease, deed or other agreement to which the Borrower is a party or by
which the Borrower or its assets are bound; (iii) a
10
Default or an Event of Default under this Agreement; and (iv) any default by any
obligor under any note or other evidence of Indebtedness payable to the
Borrower.
(j) Use of Proceeds. The Borrower shall not use the proceeds of the
Loans for any purpose other than short term liquidity in connection with
shareholder redemptions as provided in the Fund Statement and the Prospectus.
(k) Liens. The Borrower shall not create or permit to exist any
Liens with respect to any of the assets or property of the Fund, whether now
owned or hereafter acquired, except Liens in favor of the Bank.
(l) Investments. The Borrower shall not make, agree to make, or hold
any Investment which it is not permitted to make without shareholder approval
and shall make only those Investments which conform with the provisions of the
Prospectus. Without limiting the generality of the foregoing, the Borrower shall
not permit the Fund to make, agree to make, or hold any Investment which it is
not permitted to make without shareholder approval and shall comply in all
respects with, and shall make only those Investments which conform with, the
provisions of the Prospectus relating to the Fund and the provisions of the
Prospectus relating to the Borrower generally.
(m) Transfer of Property. The Borrower shall not sell, transfer,
convey or lease, any of the assets or property of the Borrower, other than in
the ordinary course of business.
(n) Change in Structure; Change in Business. The Borrower shall not
enter into any business which is substantially different from that presently
conducted by the Borrower. The Borrower shall maintain the Fund as a Series
separate and apart from any other Series.
(o) Indebtedness. The Borrower shall not incur or permit to exist
any Indebtedness other than Permitted Indebtedness. Notwithstanding anything
herein to the contrary, except for the Loans made by Bank hereunder, the
Borrower shall not incur or permit to exist any Indebtedness for liquidity or
leverage purposes.
(p) Bank Accounts. The Borrower shall not make or maintain deposits
on its own behalf or on behalf of the Fund with any bank or similar institution
which has any right of set-off, bankers' lien, combination or consolidation of
accounts, counterclaim or other similar right under Applicable Law with respect
to such deposit.
(q) Compliance with Agreements. The Borrower shall, and shall cause
the Fund to, comply with all agreements and instruments to which it is a party
or pursuant to which any of its property is encumbered.
(r) Solvency. Immediately after giving effect to the execution and
delivery of the Loan Documents and the making of the Loans hereunder and at all
times thereafter while the Loans or any portion thereof are outstanding, each of
the Borrower and the Fund shall be solvent, shall be able to pay its debts and
obligations as they become due, and shall have capital sufficient to carry on
its business.
11
(s) Contracts. The Borrower shall not, and shall not permit the Fund
to, enter into any agreement, contract or arrangement which would impair or
adversely affect (i) its right and/or ability to carry on its business as now
conducted or (ii) its right and/or ability to carry on the business of the Fund
(as if the Fund were a separate business) as now conducted.
(t) Insurance. The Borrower shall maintain such insurance as is
typically maintained by prudent companies in the same line of business as the
Borrower, and, without limitation of the generality of the foregoing, shall
maintain all insurance required under the Act.
(u) Waiver. Any variance from the covenants of the Borrower pursuant
to this Section 5 shall be permitted only with the prior written consent and/or
waiver of the Bank. Any such variance by consent and/or waiver shall relate
solely to the variance addressed in such consent and/or waiver, and shall not
operate as the Bank's consent and/or waiver to any other variance of the same
covenant or other covenants, nor shall it preclude the exercise by the Bank of
any power or right under this Agreement, other than with respect to such
variance.
5. Conditions Precedent.
(a) Conditions Precedent to the Effective Date. This Agreement shall
become effective on the date (the "Effective Date") on which the following
conditions precedent shall have been satisfied or waived by the Bank in its sole
and absolute discretion:
(i) Proof of Action; Incumbency. The Bank shall have received
an Officer's Certificate from the Borrower dated the Effective Date,
substantially in the form attached hereto as Exhibit C, and certifying (A) that
attached thereto is a true and complete copy of the articles of incorporation,
organization or partnership or declaration of trust, and operating agreement or
bylaws or other organizational and governing documents of the Borrower, as in
effect as of the Effective Date, (B) that attached thereto is the true and
correct copy of the records of all action taken by the Borrower to authorize its
execution and delivery of this Agreement and the other Loan Documents (and the
Loans contemplated hereby and thereby), and (C) as to the incumbency, the name
and specimen signature of each and every officer of Borrower, each of whom shall
be authorized (each an "Authorized Officer") (1) to sign and deliver to the
Bank, in the name of the Borrower, (1) this Agreement, any Loan Request, the
Note and the other Loan Documents, and any amendments thereof, and (2)
certificates and notices (including, without limitation, new Officer's
Certificates) and to take other action on its behalf under this Agreement. The
Borrower shall promptly file a new Officer's Certificate with updated incumbency
information whenever the officers of the Fund should change.
(ii) Note. The Bank shall have received a fully executed Note.
(iii) Representations and Warranties. The Bank shall have
received from the Borrower an Officer's Certificate to the effect that each of
the
12
representations and warranties made by the Borrower in this Agreement and in the
other Loan Documents is true and correct.
(iv) No Default. The Bank shall have received from the
Borrower an Officer's Certificate to the effect that no Default or Event of
Default is continuing on the Effective Date, or would result from the
transactions contemplated to occur on the Effective Date.
(v) Opinion. The Borrower shall have delivered to the Bank an
opinion of counsel acceptable to the Bank dated the Effective Date,
substantially in the form attached hereto as Exhibit D.
(vi) Expenses. The Borrower shall have paid to the Bank the
fees, expenses and disbursements required to be paid by the Borrower pursuant to
Section 8(d) hereof.
(vii) Financial Statements. The Borrower shall have provided
the Bank with (A) its audited financial statements for its fiscal year ended
November 30, 2003 (B) the Prospectus and (C) the Fund Statement.
(b) Conditions Precedent to Each Loan. The making of each Loan is
subject to the satisfaction of each of the following conditions precedent,
unless waived by the Bank in its sole and absolute discretion:
(i) Default. Before and after giving effect to such Loan, or
any portion thereof, no Default or Event of Default shall have occurred and be
continuing (and there exists no event which would, with notice or lapse of time
or both, mature into a Default or an Event of Default).
(ii) Representations and Warranties. Before and after giving
effect to such Loan or any portion thereof, the representations and warranties
set forth herein and in the other Loan Documents shall be true and correct as
though made on the date of such Loan.
(iii) Adverse Change. There shall have been no material
adverse change in the business or financial condition of the Borrower or the
Fund since the Effective Date.
(iv) Other Actions. The Borrower shall take such other actions
and deliver to the Bank such other documents, certificates and instruments as
the Bank may reasonably request to evidence, protect or perfect the Loans.
6. Events of Default. If any of the following events (each, an
"Event of Default") shall occur, then the Bank may without further notice or
demand, accelerate the Loans and declare them to be, and thereupon the Loans
shall become, immediately due and payable (except that upon the occurrence of an
Event of Default as described in Section 7(h) or (i) below, the Loans shall be
automatically due and payable) and the Borrower may not request further Loans
hereunder (or if already requested, may not
13
receive the proceeds of any Loans hereunder), and, regardless of whether or not
the Loans shall have been accelerated, the Bank shall have all rights provided
herein and in any of the other Loan Documents or otherwise provided by law:
(a) The Borrower shall not have paid or repaid to the Bank any
principal of or any interest on the Loans or any other obligation hereunder or
under any of the other Loan Documents when due, whether by reason of demand,
acceleration or otherwise; or
(b) There shall have occurred any other violation or breach or any
covenant, agreement or condition contained herein or in any other Loan Document
except that, in the event of a Default of the Borrower's obligation to deliver
the statements required under Section 5(b)(iii), such Default shall not
constitute an Event of Default hereunder unless the Bank has notified the
Borrower of such Default and the Borrower has not cured such Default within
thirty-six (36) hours of receiving such notice; or
(c) The Borrower shall not have paid when due any other
Indebtedness, or the holder of such other Indebtedness shall have declared such
Indebtedness due prior to its stated maturity because of the Borrower's default
thereunder or the Borrower shall have failed to perform any of its obligations
under agreements relating to Indebtedness which failure would, if not cured,
give the holder of such Indebtedness the right to accelerate the maturity of
such Indebtedness; or
(d) There shall have occurred any violation or breach of any
covenant, agreement or condition contained in any other agreement between the
Borrower and the Bank; or
(e) The Borrower shall not have performed its obligations under any
agreement material to its business; or
(f) Any representation or warranty made or deemed made herein or in
any other Loan Document or writing furnished in connection with this Agreement
shall have proven to be false when made or when deemed to have been made; or
(g) The Borrower shall have been unable to pay its debts as due; or
(h) The Borrower shall have made an assignment for the benefit of
creditors; or
(i) The Borrower shall have applied for the appointment of a trustee
or receiver for any part of its assets or shall have commenced any proceedings
relating to the Borrower under any bankruptcy, reorganization, arrangement,
insolvency, readjustment of debt, dissolution or other liquidation law of any
jurisdiction; or any such application shall have been filed, or any such
proceedings shall have commenced, against the Borrower, and either the Borrower
shall have indicated its approval, consent or acquiescence thereto or such
proceedings shall not have been dismissed within forty-five (45) days; or an
order shall have been entered appointing such trustee or receiver, or
adjudicating the Borrower bankrupt or insolvent, or approving the petition in
any such proceedings; or
(j) Any part of the Borrower's operations shall have ceased; or
14
(k) Any final judgment which, together with other outstanding
judgments against the Borrower, causes the aggregate of such judgments to exceed
One Hundred Thousand Dollars ($100,000), shall have been rendered against the
Borrower; or
(l) There shall have occurred any material adverse change in the
business or financial condition of the Borrower or its ability to repay the
Loans; or
(m) Xxxxxxxx Investment Management, LLC shall no longer be the
investment advisor to the Borrower; or
(n) The Custodian shall no longer be the custodian, or the Borrower
has evidenced any intent to remove the Custodian from its position as custodian,
of the securities and financial assets (as such terms are defined in Article 8
of the Uniform Commercial Code as adopted in the State of Ohio [the "UCC"]) of
the following described securities account (as such term is defined in Article 8
of the UCC) held by Custodian: account number 000012494400 in the name of The
Xxxxxxxx Plumb Bond Fund.
7. Miscellaneous.
(a) Right of Set-Off. In addition to all statutory rights of the
Bank, the Bank is hereby authorized at any time and from time to time, without
prior notice to the Borrower, to set-off, appropriate and apply any and all
moneys, securities and other properties of the Borrower and the proceeds thereof
now or hereafter held or received by or in transit to the Bank from or for the
account of the Borrower, whether for safekeeping, pledge, transmission,
collection or otherwise, and also upon any and all deposits (general and
special), account balances and credits of the Borrower with the Bank at any time
existing including, without limitation, account balances and credits of the
Borrower held by the Bank as Custodian, against all obligations arising under
this Agreement or any of the other Loan Documents, or any other agreements
between the Bank and Borrower, and the Borrower shall continue to be liable to
the Bank for any deficiency with interest at the rate set forth herein.
(b) Delay. No delay, omission or forbearance on the part of the Bank
in the exercise of any power or right shall operate as a waiver thereof, nor
shall any single or partial delay, omission or forbearance in the exercise of
any other power or right. The rights and remedies of the Bank herein provided
are cumulative, shall be interpreted in all respects in favor of the Bank, and
are not exclusive of any other rights and remedies provided by law.
(c) Notice. Except as otherwise expressly provided in this
Agreement, any notice hereunder shall be in writing and shall be given by
personal delivery, telecopy, or overnight courier or registered or certified
mail, postage prepaid, and addressed to the parties at their addresses set forth
below:
15
Bank: U.S. Bank National Association
000 Xxxxxx Xxxxxx, Mail Location CN-OH-W6TC
Xxxxxxxxxx, Xxxx 00000
Attention: Xxxxxx X. Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Borrower: Xxxxxxxx Plumb Funds, Inc.
1200 Xxxx X. Xxxxxxx Xxxxx, 0xx xxxxx
Xxxxxxx, Xxxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
The Borrower or the Bank may, by written notice to the other as
provided herein, designate another address or number for purposes hereunder. All
notices and other communications given to any party hereto in accordance with
the provisions of this Agreement shall be deemed to have been given on the date
of receipt if delivered by hand or overnight courier service or sent by telecopy
or on the date five (5) Business Days after dispatch by certified or registered
mail if mailed (or, if sooner, on the date of actual receipt), in each case
delivered, sent or mailed (properly addressed) to such party as provided in this
Section 8(c) or in accordance with the latest unrevoked direction from such
party given in accordance with this Section 8(c).
(d) Expenses; Indemnity. The Borrower agrees to pay all reasonable
out-of-pocket expenses of the Bank and its employees (including reasonable
attorney's fees and legal expenses, but excluding the salaries of the Bank's own
employees) incurred by the Bank in entering into and closing this Agreement and
preparing the documentation in connection herewith, and administering or
enforcing the obligations of the Borrower hereunder or under any of the other
Loan Documents, and the Borrower agrees to pay the Bank upon demand for the
same. The Borrower further agrees to defend, indemnify and hold the Bank
harmless from any liability, obligation, cost, damage or expense, including
attorney's fees and legal expenses for taxes, fees or third party claims which
may arise or be related to the execution, delivery or performance of this
Agreement or any of the other Loan Documents, except in the case of gross
negligence or willful misconduct on the part of the Bank.
(e) Survival. All covenants and agreements of the Borrower made
herein or otherwise in connection with the transactions contemplated hereby
shall survive the execution and delivery of this Agreement and the other Loan
Documents, and shall remain in effect so long as any obligations of the Borrower
are outstanding hereunder or under any of the other Loan Documents. The
obligations of the Borrower set forth in Sections 3(c), 3(d) and 8(d) shall
survive the termination of this Agreement and repayment of the Obligations.
16
(f) Severability. Any provision of this Agreement or any of the
other Loan Documents which is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such prohibition
of enforceability without invalidating the remaining portions hereof or
affecting the validity or enforceability or such provision in any other
jurisdiction.
(g) Governing Law. The Loans shall be deemed made in Ohio and this
Agreement and all of the other Loan Documents, and all of the rights and
obligations of the Borrower and the Bank hereunder and thereunder, shall in all
respects be governed by and construed in accordance with the laws of the State
of Ohio, including all matters of construction, validity and performance.
Without limitation on the ability of the Bank to exercise all of its rights as
to the Collateral or to initiate and prosecute any action or proceeding in any
applicable jurisdiction related to loan repayment, the Borrower and the Bank
agree that any action or proceeding commenced by or on behalf of the parties
arising out of or relating to the Loans and/or this Agreement and/or any of the
other Loan Documents shall be commenced and maintained exclusively in the
District Court of the United States for the Southern District of Ohio, or any
other court of applicable jurisdiction located in Cincinnati, Ohio. The Borrower
and the Bank also agree that a summons and complaint commencing an action or
proceeding in any such Ohio courts by or on behalf of such parties shall be
properly served and shall confer personal jurisdiction on a party to which said
party consents, if (i) served personally or by registered or certified mail to
the other party at any of its addresses noted herein, or (ii) as otherwise
provided under the laws of the State of Ohio. The Borrower and the Bank hereby
waive all rights to trial by jury in any proceeding arising out of or related to
the transactions contemplated hereunder or under any of the other Loan
Documents. The interest rate and all other terms of the Loans negotiated with
the Borrower are, in part, related to the aforesaid provisions on jurisdiction,
which the Bank deems a vital part of this loan arrangement.
(h) Successors. This Agreement shall be binding upon and inure to
the benefit of the Borrower and the Bank and their respective successors and
assigns. The Borrower shall not assign its rights or delegate its duties
hereunder or under any other Loan Document without the prior written consent of
the Bank.
(i) Amendment. This Agreement may not be modified or amended except
in writing signed by authorized officers of the Bank and the Borrower.
(j) Headings. The descriptive headings of the several Sections of
this Agreement are inserted for convenience only and do not constitute a part of
this Agreement.
(k) Confession of Judgment. Borrower hereby irrevocably authorizes
and empowers any attorney-at-law to appear for Borrower in any action upon or in
connection with this Agreement at any time after the Loan and/or other
obligations of Borrower hereunder become due, as herein provided, in any court
in or of the State of Ohio or elsewhere, and waive the issuance and service of
process with respect thereto, and irrevocably authorizes and empowers any such
attorney-at-law to confess judgment in favor of Bank against Borrower in the
amount due thereon or hereon, plus interest as herein provided, and all costs of
collection, and waive and release all errors in any said
17
proceedings and judgments and all rights of appeal from the judgment rendered.
The Borrower agrees and consents that the attorney confessing judgment on behalf
of the Borrower hereunder may also be counsel to the Bank and/or the Bank's
affiliates, and the Borrower hereby further waives any conflicts of interest
which might otherwise arise and consents to the Bank paying such confessing
attorney a legal fee or allowing such attorneys' fees to be paid from proceeds
of collection of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized as of the
date first above written.
THE BANK:
U.S. BANK NATIONAL ASSOCIATION
By: _____________________________________
Name: Xxxxxx X. Xxxxxxxxx
Title: Vice President
WARNING--BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND COURT TRIAL.
IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU WITHOUT YOUR
PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT FROM YOU
REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE BANK.
THE BORROWER:
XXXXXXXX XXXXX FUNDS, INC.
By: _____________________________________
Name: Xxxx X. Xxxxxxxx
Title: Chairman & Secretary
EXHIBITS:
A - Note
B - Loan Request
C - Officer's Certificate
D - Opinion of Counsel
18
EXHIBIT A
PROMISSORY NOTE
$1,000,000 Cincinnati, Ohio
October 1, 2004
Xxxxxxxx Xxxxx Funds, Inc., a Wisconsin corporation (the
"Borrower"), for value received, hereby promises to pay to the order of U.S.
BANK N.A. (the "Bank"), or its successors or assigns, on or before November 15,
2004 (the "Maturity Date"), the principal sum of One Million Dollars
($1,000,000.00), or such portion thereof as may be outstanding from time to time
as a Loan under the hereinafter-described Loan Agreement, together with interest
thereon as hereinafter provided.
This Note is the "Note" to which reference is made in the Loan
Agreement dated as of October 1, 2004 with respect to the Xxxxxxxx Plumb Bond
Fund (the "Fund") between the Borrower and the Bank (as amended, supplemented or
otherwise modified from time to time, the "Loan Agreement") and is subject to
the terms and conditions thereof, including without limitation the terms thereof
providing for acceleration of maturity of the loans made by the Bank to the
Borrower under the Loan Agreement and evidenced by this Note (the "Loans").
This Note shall bear interest at a rate per annum equal to Prime,
which interest shall be payable to the Bank (i) monthly, in arrears, commencing
on November 1, 2004 and on the first day of each month thereafter, (ii) whenever
all or any part of the Loans are due and payable, whether on the Maturity Date,
by virtue of a mandatory prepayment, or by reason of demand, acceleration or
otherwise (on the amount so due and payable) and (iii) whenever the Borrower
repays all of the Loans as a voluntary prepayment. Interest on this Note shall
be computed on the basis of a year consisting of three hundred sixty (360) days
but applied to the actual number of days elapsed.
As used herein, the term "Prime Rate" shall mean the rate which the
Bank announces as its prime lending rate, as in effect from time to time. The
Prime Rate is determined solely by the Bank pursuant to market factors and its
own operating needs and does not necessarily represent the lowest or best rate
actually charged to any customer. The Bank may make commercial or other loans at
rates of interest at, above or below the Prime Rate.
The principal of this Note is subject to mandatory prepayments, as
follows: (i) if the aggregate principal amount of the Loans outstanding exceeds
the Available Facility at any time, such excess shall be immediately due and
payable and (ii) the principal of this Note shall be due and payable in full on
the Maturity Date and, if earlier, the date on which the Loans become due,
whether by virtue of demand, acceleration or otherwise. This Note may be
voluntarily prepaid in whole or in part at any time, without premium or penalty;
provided, however that each prepayment of principal shall be in an amount equal
to, or greater than, $1,000.00 or, if less, the outstanding balance of this
Note.
If any payment is not made within ten (10) days after the date due,
the Borrower shall pay the Bank an amount equal to five percent (5%) of such
payment or $50.00, whichever is greater.
An "Event of Default" as described in the Loan Agreement shall
constitute an Event of Default hereunder. Upon the occurrence of an Event of
Default, the Bank shall have all rights and remedies provided herein, in the
Loan Agreement and otherwise available at law or in equity. At the option of the
Bank, upon the occurrence and during the continuance of any Event of Default,
this Note shall bear interest (computed and adjusted in the same manner, and
with the same effect, as interest prior to the occurrence of such Event of
Default) payable on demand at a rate equal to three percent (3%) per annum in
excess of the otherwise applicable rate.
All payments of principal and interest hereunder shall be made in
immediately available funds to the Bank at 000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx
00000, M.L. CN-OH-W6TC, or at such other place as may be designated by the
holder hereof to the Borrower in writing. The Borrower authorizes the Bank to
charge any account, in the name of the Fund, or charge or increase any loan
balance of the Borrower at the Bank for the amount of any interest or principal
payments due to the Bank hereunder. The Bank is further authorized by the
Borrower to enter from time to time the balance of this Note and all payments
thereon on the reverse of this Note or in the Bank's regularly maintained data
processing records, and the aggregate unpaid amount set forth thereon or therein
shall be presumptive evidence of the amount owing to the Bank and unpaid on this
Note, absent manifest error.
If any term or condition of this Note conflicts with the express
terms or conditions of the Loan Agreement, the terms and conditions of the Loan
Agreement shall control. Terms used but not defined herein shall have the same
meanings herein as in the Loan Agreement.
IMPORTANT: This Note shall be deemed made in Ohio and shall in all
respects be governed by and construed in accordance with the laws of the State
of Ohio, including all matters of construction, validity and performance.
Without limitation on the ability of the Bank to initiate and
prosecute any action or proceeding in any applicable jurisdiction related to
loan repayment, the Borrower and the Bank agree that any action or proceeding
commenced by or on behalf of the parties arising out of or relating to this Note
shall be commenced and maintained exclusively in the United States District
Court for the Southern District of Ohio, or any other court of applicable
jurisdiction located in Cincinnati, Ohio. The Borrower and the Bank also agree
that a summons and complaint commencing an action or proceeding in any such Ohio
courts by or on behalf of such parties shall be properly served and shall confer
personal jurisdiction on a party to which said party consents, if (i) served
personally or by registered or certified mail to the other party at any of its
addresses noted herein, or (ii) as otherwise provided under the laws of the
State of Ohio. The Borrower and the Bank hereby waive all rights to trial by
jury in any proceeding arising out of or related to this Note. The interest rate
and all other terms of this Note negotiated with the Borrower are, in part,
related to the aforesaid provisions on jurisdiction, which the Bank deems a
vital part of this loan arrangement.
2
Presentment for payment, notice of dishonor, protest, demand, notice
of protest and all other notices are hereby waived.
Borrower hereby irrevocably authorizes and empowers any
attorney-at-law to appear for Borrower in any action upon or in connection with
this Agreement at any time after the Loans and/or other obligations of Borrower
evidenced hereby become due, as herein provided, in any court in or of the State
of Ohio or elsewhere, and waives the issuance and service of process with
respect thereto, and irrevocably authorizes and empowers any such
attorney-at-law to confess judgment in favor of Bank against Borrower in the
amount due thereon or hereon, plus interest as herein provided, and all costs of
collection, and waives and releases all errors in any said proceedings and
judgments and all rights of appeal from the judgment rendered. The Borrower
agrees and consents that the attorney confessing judgment on behalf of the
Borrower hereunder may also be counsel to the Bank and/or the Bank's affiliates,
and the Borrower hereby further waives any conflict of interest which might
otherwise arise and consents to the Bank paying such confessing attorney a legal
fee or allowing such attorneys' fees to be paid from proceeds of collection of
this Agreement and/or any and all collateral and security for the Loans and
obligations.
WARNING--BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU
WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT
FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE BANK.
XXXXXXXX XXXXX FUNDS, INC.
By: _____________________________________
Name: Xxxx X. Xxxxxxxx
Title: Chairman & Secretary
3
EXHIBIT B
FORM OF LOAN REQUEST
U.S. Bank, National Association
000 Xxxxxx Xxxxxx, X.X. XX-XX-X0XX
Xxxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxx
Ladies and Gentlemen:
This loan request is delivered to you pursuant to Section 2(c) of
that certain Loan Agreement (as amended, supplemented or otherwise modified from
time to time (the "Loan Agreement") dated as of October 1, 2004 between U.S.
Bank National Association (the "Bank") and Xxxxxxxx Plumb Funds, Inc. (the
"Borrower") relating to the Xxxxxxxx Xxxxx Bond Fund (the "Fund"). Capitalized
terms used herein without definition shall have the meaning assigned to such
terms in the Loan Agreement unless the context otherwise requires.
The Borrower hereby [requests][confirms the verbal request made by
the Borrower prior to 2:00 p.m. on the date hereof for] a Loan on this date from
the Bank in the aggregate principal amount of $___________________ . The
Borrower hereby certifies, represents and warrants that on the date hereof, both
before and after giving effect to the requested Loan or any portion thereof:
(a) The aggregate principal amount of the Loans outstanding does not
and will not exceed the Available Facility;
(b) No Default or Event of Default has occurred and is continuing,
nor will the making of such Loan cause a Default or Event of Default to occur;
(c) All representations and warranties set forth in the Loan
Documents are and will be true and correct as though made on the date hereof;
(d) Since the Effective Date, there has not been and there will not
be any material adverse change in the business or financial condition of the
Borrower or the Fund, nor has there been nor will there be a material adverse
change in respect of the validity or enforceability or priority of any Liens
granted to the Bank under the Loan Documents;
(e) The proceeds of the Loans will not be used for any purpose that
is not permitted under the Loan Agreement; and
(f) Upon receipt by the Bank of this loan request, all conditions
set forth in Section 6(b) of the Loan Agreement will have been satisfied.
IN WITNESS WHEREOF, the Borrower has caused this loan request to be
executed and delivered by its duly Authorized Officer as of this ____ day of
____________________.
XXXXXXXX PLUMB FUNDS, INC.
By: _____________________________________
Name: ___________________________________
Title: __________________________________
2
EXHIBIT C
OFFICER'S CERTIFICATE
Xxxxxxxx Xxxxx Funds, Inc., a corporation is entering into and/or
continuing a loan transaction with U.S. BANK N.A. (the "Bank") pursuant to a
loan agreement effective as of even date herewith (the "Loan Agreement"). In
that connection, the undersigned certifies:
1. Attached hereto as Schedule 1 is a true copy of the Articles or
Certificate of Incorporation of Borrower on file in the office of the Secretary
of State of Wisconsin which has not been modified, rescinded or superceded and
remains in full force and effect as of the date hereof.
2. Attached hereto as Schedule 2 is a true copy of the duly adopted
By-Laws of Borrower, which has not been modified, rescinded or superceded and
remains in full force and effect as of the date hereof.
3. Attached hereto as Schedule 3 are true copies of certain
resolutions authorizing the loan transactions which were duly adopted by the
Board of Directors of Borrower, and which have not been amended, rescinded or
superceded and remain in full force and effect as of the date hereof.
4. Borrower is not a party to any agreement that adversely affects,
or would be violated by its entering into, the loan transactions and any
document or instrument related thereto.
5. The execution and delivery of such loan facility documents (A)
does not violate or constitute on the part of Borrower a breach or default under
(i) any applicable provision of statutory law or regulations, (ii) any order,
judgment or decree of any court, governmental agency or authority, or (iii) any
agreement with any third party, and (B) does not require the approval or consent
of any governmental body or other person.
6. No Event of Default (as defined in Section 7 of the Loan
Agreement) or any event which, with the passage of time or the giving of notice,
might mature into an Event of Default has occurred or is continuing as of the
date hereof.
7. The representations and warranties in Section 4 of the Loan
Agreement are true and correct in all material respects as of the date hereof
(except for those limited to or expressed only as of a prior specific date).
8. The persons listed below are all the duly elected officers or
Borrower and each is authorized to execute on behalf of Borrower and deliver to
the Bank all documents and instruments described in the aforesaid resolutions of
the Borrower and in Section 6(a)(i) of the Loan Agreement.
NAME TITLE SIGNATURE
___________________ _______________ ____________________
___________________ _______________ ____________________
___________________ _______________ ____________________
___________________ _______________ ____________________
Dated as of ____________, 20___
BORROWER:
XXXXXXXX XXXXX FUNDS, INC.
By: _____________________________________
Name: Xxxx X. Xxxxxxxx
Title: Chairman & Secretary
2
EXHIBIT D
FORM OF OPINION OF BORROWER'S COUNSEL
We have acted as counsel to _________________________________, a
_________________________ (the "Borrower"), in connection with a loan in an
amount of up to $ ____________________ being made by U.S. Bank National
Association (the "Bank") to the Borrower in connection with the Fund (the
"Fund"). In this regard, we have examined the following documents (collectively,
the "Loan Documents"):
(i) Loan Agreement dated as of ___________________ between the
Borrower and the Bank (the "Loan Agreement"); and
(ii) Promissory Note dated as of __________________________ given by
the Borrower to the Bank.
On the basis of the foregoing, we are of the opinion that:
1. The Borrower is duly organized, validly existing and in active
status under the laws of _________________ and is registered as an investment
company under the Investment Company Act of 1940.
2. The Borrower has full power and authority to own its assets and
to conduct its business as a management investment company.
3. The Fund is a duly created and validly existing Series (as
defined in the Loan Agreement) of the Borrower.
4. The Borrower has full power and authority to execute the Loan
Documents and to perform its obligations thereunder.
5. The execution and delivery of, and the performance by the
Borrower of its obligations under, the Loan Documents (a) have been duly
authorized by all necessary action, (b) are not in conflict with and do not
violate any provisions of the Borrower's articles of incorporation, declaration
of trust or other organizational or governing documents, (c) do not violate any
law, rule, regulation, order or decree, and (d) to our knowledge, are not in
conflict with and do not result in any breach or default under any document,
instrument or agreement to which the Borrower is a party.
The Loan Documents have been duly executed and delivered by the
Borrower and constitute the legal, valid and binding obligations of the
Borrower, enforceable against the Borrower in accordance with their terms,
subject, as to enforcement of remedies, to applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the rights of creditors
generally and the discretion of courts in granting equitable remedies.
PROMISSORY NOTE
$1,000,000 Cincinnati, Ohio
October 1, 2004
Xxxxxxxx Xxxxx Funds, Inc., a Wisconsin corporation (the
"Borrower"), for value received, hereby promises to pay to the order of U.S.
BANK N.A. (the "Bank"), or its successors or assigns, on or before November 15,
2004 (the "Maturity Date"), the principal sum of One Million Dollars
($1,000,000.00), or such portion thereof as may be outstanding from time to time
as a Loan under the hereinafter-described Loan Agreement, together with interest
thereon as hereinafter provided.
This Note is the "Note" to which reference is made in the Loan
Agreement dated as of October 1, 2004 with respect to the Xxxxxxxx Plumb Bond
Fund (the "Fund") between the Borrower and the Bank (as amended, supplemented or
otherwise modified from time to time, the "Loan Agreement") and is subject to
the terms and conditions thereof, including without limitation the terms thereof
providing for acceleration of maturity of the loans made by the Bank to the
Borrower under the Loan Agreement and evidenced by this Note (the "Loans").
This Note shall bear interest at a rate per annum equal to Prime,
which interest shall be payable to the Bank (i) monthly, in arrears, commencing
on November 1, 2004 and on the first day of each month thereafter, (ii) whenever
all or any part of the Loans are due and payable, whether on the Maturity Date,
by virtue of a mandatory prepayment, or by reason of demand, acceleration or
otherwise (on the amount so due and payable) and (iii) whenever the Borrower
repays all of the Loans as a voluntary prepayment. Interest on this Note shall
be computed on the basis of a year consisting of three hundred sixty (360) days
but applied to the actual number of days elapsed.
As used herein, the term "Prime Rate" shall mean the rate which the
Bank announces as its prime lending rate, as in effect from time to time. The
Prime Rate is determined solely by the Bank pursuant to market factors and its
own operating needs and does not necessarily represent the lowest or best rate
actually charged to any customer. The Bank may make commercial or other loans at
rates of interest at, above or below the Prime Rate.
The principal of this Note is subject to mandatory prepayments, as
follows: (i) if the aggregate principal amount of the Loans outstanding exceeds
the Available Facility at any time, such excess shall be immediately due and
payable and (ii) the principal of this Note shall be due and payable in full on
the Maturity Date and, if earlier, the date on which the Loans become due,
whether by virtue of demand, acceleration or otherwise. This Note may be
voluntarily prepaid in whole or in part at any time, without premium or penalty;
provided, however that each prepayment of principal shall be in an amount equal
to, or greater than, $1,000.00 or, if less, the outstanding balance of this
Note.
2
If any payment is not made within ten (10) days after the date due,
the Borrower shall pay the Bank an amount equal to five percent (5%) of such
payment or $50.00, whichever is greater.
An "Event of Default" as described in the Loan Agreement shall
constitute an Event of Default hereunder. Upon the occurrence of an Event of
Default, the Bank shall have all rights and remedies provided herein, in the
Loan Agreement and otherwise available at law or in equity. At the option of the
Bank, upon the occurrence and during the continuance of any Event of Default,
this Note shall bear interest (computed and adjusted in the same manner, and
with the same effect, as interest prior to the occurrence of such Event of
Default) payable on demand at a rate equal to three percent (3%) per annum in
excess of the otherwise applicable rate.
All payments of principal and interest hereunder shall be made in
immediately available funds to the Bank at 000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx
00000, M.L. CN-OH-W6TC, or at such other place as may be designated by the
holder hereof to the Borrower in writing. The Borrower authorizes the Bank to
charge any account, in the name of the Fund, or charge or increase any loan
balance of the Borrower at the Bank for the amount of any interest or principal
payments due to the Bank hereunder. The Bank is further authorized by the
Borrower to enter from time to time the balance of this Note and all payments
thereon on the reverse of this Note or in the Bank's regularly maintained data
processing records, and the aggregate unpaid amount set forth thereon or therein
shall be presumptive evidence of the amount owing to the Bank and unpaid on this
Note, absent manifest error.
If any term or condition of this Note conflicts with the express
terms or conditions of the Loan Agreement, the terms and conditions of the Loan
Agreement shall control. Terms used but not defined herein shall have the same
meanings herein as in the Loan Agreement.
IMPORTANT: This Note shall be deemed made in Ohio and shall in all
respects be governed by and construed in accordance with the laws of the State
of Ohio, including all matters of construction, validity and performance.
Without limitation on the ability of the Bank to initiate and
prosecute any action or proceeding in any applicable jurisdiction related to
loan repayment, the Borrower and the Bank agree that any action or proceeding
commenced by or on behalf of the parties arising out of or relating to this Note
shall be commenced and maintained exclusively in the United States District
Court for the Southern District of Ohio, or any other court of applicable
jurisdiction located in Cincinnati, Ohio. The Borrower and the Bank also agree
that a summons and complaint commencing an action or proceeding in any such Ohio
courts by or on behalf of such parties shall be properly served and shall confer
personal jurisdiction on a party to which said party consents, if (i) served
personally or by registered or certified mail to the other party at any of its
addresses noted herein, or (ii) as otherwise provided under the laws of the
State of Ohio. The Borrower and the Bank hereby waive all rights to trial by
jury in any proceeding arising out of or related to this Note. The interest rate
and all other terms of this Note negotiated with the Borrower are, in part,
related to the aforesaid provisions on jurisdiction, which the Bank deems a
vital part of this loan arrangement.
3
Presentment for payment, notice of dishonor, protest, demand, notice
of protest and all other notices are hereby waived.
Borrower hereby irrevocably authorizes and empowers any
attorney-at-law to appear for Borrower in any action upon or in connection with
this Agreement at any time after the Loans and/or other obligations of Borrower
evidenced hereby become due, as herein provided, in any court in or of the State
of Ohio or elsewhere, and waives the issuance and service of process with
respect thereto, and irrevocably authorizes and empowers any such
attorney-at-law to confess judgment in favor of Bank against Borrower in the
amount due thereon or hereon, plus interest as herein provided, and all costs of
collection, and waives and releases all errors in any said proceedings and
judgments and all rights of appeal from the judgment rendered. The Borrower
agrees and consents that the attorney confessing judgment on behalf of the
Borrower hereunder may also be counsel to the Bank and/or the Bank's affiliates,
and the Borrower hereby further waives any conflict of interest which might
otherwise arise and consents to the Bank paying such confessing attorney a legal
fee or allowing such attorneys' fees to be paid from proceeds of collection of
this Agreement and/or any and all collateral and security for the Loans and
obligations.
WARNING--BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU
WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT
FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE BANK.
XXXXXXXX XXXXX FUNDS, INC.
By: _____________________________________
Name: Xxxx X. Xxxxxxxx
Title: Chairman & Secretary
4
OFFICER'S CERTIFICATE
Xxxxxxxx Xxxxx Funds, Inc., a corporation is entering into and/or
continuing a loan transaction with U.S. BANK N.A. (the "Bank") pursuant to a
loan agreement effective as of even date herewith (the "Loan Agreement"). In
that connection, the undersigned certifies:
1. Attached hereto as Schedule 1 is a true copy of the Articles or
Certificate of Incorporation of Borrower on file in the office of the Secretary
of State of Wisconsin which has not been modified, rescinded or superceded and
remains in full force and effect as of the date hereof.
2. Attached hereto as Schedule 2 is a true copy of the duly adopted
By-Laws of Borrower, which has not been modified, rescinded or superceded and
remains in full force and effect as of the date hereof.
3. Attached hereto as Schedule 3 are true copies of certain
resolutions authorizing the loan transactions which were duly adopted by the
Board of Directors of Borrower, and which have not been amended, rescinded or
superceded and remain in full force and effect as of the date hereof.
4. Borrower is not a party to any agreement that adversely affects,
or would be violated by its entering into, the loan transactions and any
document or instrument related thereto.
5. The execution and delivery of such loan facility documents (A)
does not violate or constitute on the part of Borrower a breach or default under
(i) any applicable provision of statutory law or regulations, (ii) any order,
judgment or decree of any court, governmental agency or authority, or (iii) any
agreement with any third party, and (B) does not require the approval or consent
of any governmental body or other person.
6. No Event of Default (as defined in Section 7 of the Loan
Agreement) or any event which, with the passage of time or the giving of notice,
might mature into an Event of Default has occurred or is continuing as of the
date hereof.
7. The representations and warranties in Section 4 of the Loan
Agreement are true and correct in all material respects as of the date hereof
(except for those limited to or expressed only as of a prior specific date).
8. The persons listed below are all the duly elected officers or
Borrower and each is authorized to execute on behalf of Borrower and deliver to
the Bank all documents and instruments described in the aforesaid resolutions of
the Borrower and in Section 6(a)(i) of the Loan Agreement.
NAME TITLE SIGNATURE
___________________ _______________ ____________________
___________________ _______________ ____________________
___________________ _______________ ____________________
___________________ _______________ ____________________
Dated as of ____________, 20___
BORROWER:
XXXXXXXX PLUMB FUNDS, INC.
By: _____________________________________
Name: Xxxx X. Xxxxxxxx
Title: Chairman & Secretary
November 1, 2004
Xx. Xxxx X. Xxxxxxxx
Chairman & Secretary
Xxxxxxxx Xxxxx Funds
1200 Xxxx X. Xxxxxxx Xxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxxxx 00000
Re: The LOAN AGREEMENT, as amended, restated, supplemented or otherwise
modified from time to time (the "Agreement"), dated as of October 1, 2004,
by and between Xxxxxxxx Xxxxx Funds, Inc., for the benefit of the Xxxxxxxx
Plumb Bond Fund (the "Borrower"), and U.S. BANK, N.A. (the "Bank").
Dear Xx. Xxxxxxxx:
This letter (the "First Amendment") when duly and validly executed by the
Borrower shall amend the above referenced Agreement, effective as of November
15, 2004, such that:
The Maturity Date shall be defined as November 15, 2005.
As a condition to the effectiveness of the First Amendment, the Borrower
shall deliver to the Bank a duly and validly executed revolving promissory note
(the "Amended Note") substantially in the form of Exhibit A hereto. The Amended
Note shall replace and restate the Note referenced in the Agreement.
Except as modified above, all other representations, warranties,
covenants, terms, and conditions set forth in the Loan Agreement shall remain in
full force and effect. Capitalized terms used herein shall have the same
meanings as defined in the Loan Agreement.
If the above terms represent our understanding, please indicate your
agreement by signing below and returning one copy of the First Amendment along
with the promissory note to me.
Sincerely,
Xxxxxx X. Xxxxx
Assistant Vice President
Accepted this _______ day of November, 2004.
BORROWER: XXXXXXXX XXXXX FUNDS, INC.
By: _______________________________
Name: Xxxx X. Xxxxxxxx Title: Chairman & Secretary
EXHIBIT A
PROMISSORY NOTE
$1,000,000 Cincinnati, Ohio
November 15, 2004
Xxxxxxxx Xxxxx Funds, Inc., a Wisconsin corporation (the
"Borrower"), for value received, hereby promises to pay to the order of U.S.
BANK N.A. (the "Bank"), or its successors or assigns, on or before November 15,
2005 (the "Maturity Date"), the principal sum of One Million Dollars
($1,000,000.00), or such portion thereof as may be outstanding from time to time
as a Loan under the hereinafter-described Loan Agreement, together with interest
thereon as hereinafter provided.
This Note is the "Note" to which reference is made in the Loan
Agreement dated as of October 1, 2004 with respect to the Xxxxxxxx Plumb Bond
Fund (the "Fund") between the Borrower and the Bank (as amended, supplemented or
otherwise modified from time to time, the "Loan Agreement") and is subject to
the terms and conditions thereof, including without limitation the terms thereof
providing for acceleration of maturity of the loans made by the Bank to the
Borrower under the Loan Agreement and evidenced by this Note (the "Loans").
This Note shall bear interest at a rate per annum equal to Prime,
which interest shall be payable to the Bank (i) monthly, in arrears, commencing
on November 1, 2004 and on the first day of each month thereafter, (ii) whenever
all or any part of the Loans are due and payable, whether on the Maturity Date,
by virtue of a mandatory prepayment, or by reason of demand, acceleration or
otherwise (on the amount so due and payable) and (iii) whenever the Borrower
repays all of the Loans as a voluntary prepayment. Interest on this Note shall
be computed on the basis of a year consisting of three hundred sixty (360) days
but applied to the actual number of days elapsed.
As used herein, the term "Prime Rate" shall mean the rate which the
Bank announces as its prime lending rate, as in effect from time to time. The
Prime Rate is determined solely by the Bank pursuant to market factors and its
own operating needs and does not necessarily represent the lowest or best rate
actually charged to any customer. The Bank may make commercial or other loans at
rates of interest at, above or below the Prime Rate.
The principal of this Note is subject to mandatory prepayments, as
follows: (i) if the aggregate principal amount of the Loans outstanding exceeds
the Available Facility at any time, such excess shall be immediately due and
payable and (ii) the principal of this Note shall be due and payable in full on
the Maturity Date and, if earlier, the date on which the Loans become due,
whether by virtue of demand, acceleration or otherwise. This Note may be
voluntarily prepaid in whole or in part at any time, without premium or penalty;
provided, however that each prepayment of principal shall be in an
amount equal to, or greater than, $1,000.00 or, if less, the outstanding balance
of this Note.
If any payment is not made within ten (10) days after the date due,
the Borrower shall pay the Bank an amount equal to five percent (5%) of such
payment or $50.00, whichever is greater.
An "Event of Default" as described in the Loan Agreement shall
constitute an Event of Default hereunder. Upon the occurrence of an Event of
Default, the Bank shall have all rights and remedies provided herein, in the
Loan Agreement and otherwise available at law or in equity. At the option of the
Bank, upon the occurrence and during the continuance of any Event of Default,
this Note shall bear interest (computed and adjusted in the same manner, and
with the same effect, as interest prior to the occurrence of such Event of
Default) payable on demand at a rate equal to three percent (3%) per annum in
excess of the otherwise applicable rate.
All payments of principal and interest hereunder shall be made in
immediately available funds to the Bank at 000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx
00000, M.L. CN-OH-W6TC, or at such other place as may be designated by the
holder hereof to the Borrower in writing. The Borrower authorizes the Bank to
charge any account, in the name of the Fund, or charge or increase any loan
balance of the Borrower at the Bank for the amount of any interest or principal
payments due to the Bank hereunder. The Bank is further authorized by the
Borrower to enter from time to time the balance of this Note and all payments
thereon on the reverse of this Note or in the Bank's regularly maintained data
processing records, and the aggregate unpaid amount set forth thereon or therein
shall be presumptive evidence of the amount owing to the Bank and unpaid on this
Note, absent manifest error.
If any term or condition of this Note conflicts with the express
terms or conditions of the Loan Agreement, the terms and conditions of the Loan
Agreement shall control. Terms used but not defined herein shall have the same
meanings herein as in the Loan Agreement.
IMPORTANT: This Note shall be deemed made in Ohio and shall in all
respects be governed by and construed in accordance with the laws of the State
of Ohio, including all matters of construction, validity and performance.
Without limitation on the ability of the Bank to initiate and
prosecute any action or proceeding in any applicable jurisdiction related to
loan repayment, the Borrower and the Bank agree that any action or proceeding
commenced by or on behalf of the parties arising out of or relating to this Note
shall be commenced and maintained exclusively in the United States District
Court for the Southern District of Ohio, or any other court of applicable
jurisdiction located in Cincinnati, Ohio. The Borrower and the Bank also agree
that a summons and complaint commencing an action or proceeding in any such Ohio
courts by or on behalf of such parties shall be properly served and shall confer
personal jurisdiction on a party to which said party consents, if (i) served
personally or by registered or certified mail to the other party at any of its
addresses noted herein, or (ii) as otherwise provided under the laws of the
State of Ohio. The Borrower and the Bank hereby waive all rights to trial by
jury in any proceeding arising out of or related to this Note. The interest rate
and all other terms of this Note
negotiated with the Borrower are, in part, related to the aforesaid provisions
on jurisdiction, which the Bank deems a vital part of this loan arrangement.
Presentment for payment, notice of dishonor, protest, demand, notice
of protest and all other notices are hereby waived.
Borrower hereby irrevocably authorizes and empowers any
attorney-at-law to appear for Borrower in any action upon or in connection with
this Agreement at any time after the Loans and/or other obligations of Borrower
evidenced hereby become due, as herein provided, in any court in or of the State
of Ohio or elsewhere, and waives the issuance and service of process with
respect thereto, and irrevocably authorizes and empowers any such
attorney-at-law to confess judgment in favor of Bank against Borrower in the
amount due thereon or hereon, plus interest as herein provided, and all costs of
collection, and waives and releases all errors in any said proceedings and
judgments and all rights of appeal from the judgment rendered. The Borrower
agrees and consents that the attorney confessing judgment on behalf of the
Borrower hereunder may also be counsel to the Bank and/or the Bank's affiliates,
and the Borrower hereby further waives any conflict of interest which might
otherwise arise and consents to the Bank paying such confessing attorney a legal
fee or allowing such attorneys' fees to be paid from proceeds of collection of
this Agreement and/or any and all collateral and security for the Loans and
obligations.
WARNING--BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU
WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT
FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE BANK.
XXXXXXXX XXXXX FUNDS, INC.
By: _____________________________________
Name: Xxxx X. Xxxxxxxx
Title: Chairman & Secretary
