Exhibit 10(i).6
PROMISSORY NOTE
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Principal Loan Date Maturity Loan No Call/Coll Account Officer Initials
$6,250,000.00 08-30-2007 08-28-2009 1089921654 410 / 4 703
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References in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item.
Any item above containing "***" has been omitted due to text length limitations.
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Borrower: MorAmerica Capital Corporation
000 0xx Xxxxxx XX Xxx 000
Xxxxx Xxxxxx, XX 00000
Lender: Cedar Rapids Bank and Trust Company
000 0xx Xxxxxx XX Xxx 000, P.O. Box 789
Cedar Rapids, IA 52406-0789
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Principal Amount: $6,250,000.00 Initial Rate: 8.750% Date of Note: August 30, 2007
PROMISE TO PAY. MorAmerica Capital Corporation ("Borrower") promises to pay to
Cedar Rapids Bank and Trust Company ("Lender"), or order, in lawful money of the
United States of America, the principal amount of Six Million Two Hundred Fifty
Thousand & 00/100 Dollars ($6,250,000.00), together with interest on the unpaid
principal balance from August 30, 2007, until paid in full.
PAYMENT. Borrower will pay this loan in one principal payment of $6,250,000.00
plus interest on August 28, 2009. This payment due on August 28, 2009, will be
for all principal and all accrued interest not yet paid. In addition, Borrower
will pay regular monthly payments of all accrued unpaid interest due as of each
payment date, beginning September 30, 2007, with all subsequent interest
payments to be due on the last day of each month after that. Unless otherwise
agreed or required by applicable law, payments will be applied first to any
accrued unpaid interest; then to principal; and then to any late charges. The
annual interest rate for this Note is computed on a 365/360 basis; that is, by
applying the ratio of the annual interest rate over a year of 360 days,
multiplied by the outstanding principal balance, multiplied by the actual number
of days the principal balance is outstanding. Borrower will pay Lender at
Xxxxxx's address shown above or at such other place as Lender may designate in
writing.
VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from
time to time based on changes in an independent index which is the Wall Street
Journal Prime as published in The Wall Street Journal (the "Index"). The Index
is not necessarily the lowest rate charged by Lender on its loans. If the Index
becomes unavailable during the term of this loan, Lender may designate a
substitute index after notifying Borrower. Lender will tell Borrower the current
Index rate upon Xxxxxxxx's request. The interest rate change will not occur more
often than each day. Borrower understands that Lender may make loans based on
other rates as well. The Index currently is 8.250% per annum. The interest rate
to be applied to the unpaid principal balance during this Note will be at a rate
of 0.500 percentage points over the Index, adjusted if necessary for any minimum
and maximum rate limitations described below, resulting in an initial rate of
8.750% per annum. NOTICE: Under no circumstances will the interest rate on this
Note be less than 6.000% per annum or more than the maximum rate allowed by
applicable law. Notwithstanding the above provisions, the maximum increase or
decrease in the interest rate at any one time on this loan will not exceed 1.000
percentage points.
PREPAYMENT. Borrower may pay without penalty all or a portion of the amount owed
earlier than it is due. Early payments will not, unless agreed to by Xxxxxx in
writing, relieve Xxxxxxxx of Xxxxxxxx's obligation to continue to make payments
under the payment schedule. Rather, early payments will reduce the principal
balance due. Xxxxxxxx agrees not to send Lender payments marked "paid in full",
"without recourse", or similar language. If Borrower sends such a payment,
Xxxxxx may accept it without losing any of Xxxxxx's rights under this Note, and
Borrower will remain obligated to pay any further amount owed to Lender. All
written communications concerning disputed amounts, including any check or other
payment instrument that indicates that the payment constitutes "payment in full"
of the amount owed or that is tendered with other conditions or limitations or
as full satisfaction of a disputed amount must be mailed or delivered to: Cedar
Rapids Bank and Trust Company, 000 0xx Xxxxxx XX Xxx 000, X.X. Box 789 Cedar
Rapids, IA 52406-0789.
LATE CHARGE. If a payment is 10 days or more late, Borrower will be charged
5.000% of the regularly scheduled payment.
INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final
maturity, the interest rate on this Note shall be increased by adding a 3.000
percentage point margin ("Default Rate Margin"). The Default Rate Margin shall
also apply to each
PROMISSORY NOTE Page 2
Loan No.: 1089921654 (Continued)
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succeeding interest rate change that would have applied had there been no
default. However, in no event will the interest rate exceed the maximum interest
rate limitations under applicable law.
DEFAULT. Each of the following shall constitute an event of default ("Event of
Default") under this Note:
Payment Default. Borrower fails to make any payment when due under
this Note.
Other Defaults. Borrower fails to comply with or to perform any other
term, obligation, covenant or condition contained in this Note or in
any of the related documents or to comply with or to perform any term,
obligation, covenant or condition contained in any other agreement
between Lender and Borrower.
Default in Favor of Third Parties. Borrower or any Grantor defaults
under any loan, extension of credit, security agreement, purchase or
sales agreement, or any other agreement, in favor of any other
creditor or person that may materially affect any of Borrower's
property or Borrower's ability to repay this Note or perform
Borrower's obligations under this Note or any of the related
documents.
False Statements. Any warranty, representation or statement made or
furnished to Lender by Borrower or on Borrower's behalf under this
Note or the related documents is false or misleading in any material
respect, either now or at the time made or furnished or becomes false
or misleading at any time thereafter.
Insolvency. The dissolution or termination of Xxxxxxxx's existence as
a going business, the insolvency of Xxxxxxxx, the appointment of a
receiver for any part of Xxxxxxxx's property, any assignment for the
benefit of creditors, any type of creditor workout, or the
commencement of any proceeding under any bankruptcy or insolvency laws
by or against Borrower.
Creditor or Forfeiture Proceedings. Commencement of foreclosure or
forfeiture proceedings, whether by judicial proceeding, self-help,
repossession or any other method, by any creditor of Borrower or by
any governmental agency against any collateral securing the loan. This
includes a garnishment of any of Xxxxxxxx's accounts, including
deposit accounts, with Lender. However, this Event of Default shall
not apply if there is a good faith dispute by Xxxxxxxx as to the
validity or reasonableness of the claim which is the basis of the
creditor or forfeiture proceeding and if Borrower gives Xxxxxx written
notice of the creditor or forfeiture proceeding and deposits with
Lender monies or a surety bond for the creditor or forfeiture
proceeding, in an amount determined by Lender, in its sole discretion,
as being an adequate reserve or bond for the dispute.
Events Affecting Guarantor. Any of the preceding events occurs with
respect to any Guarantor of any of the indebtedness or any Guarantor
dies or becomes incompetent, or revokes or disputes the validity of,
or liability under, any guaranty of the indebtedness evidenced by this
Note. In the event of a death, Lender, at its option, may, but shall
not be required to, permit the Guarantor's estate to assume
unconditionally the obligations arising under the guaranty in a manner
satisfactory to Lender, and, in doing so, cure any Event of Default.
Change In Ownership. Any change in ownership of twenty-five percent
(25%) or more of the common stock of Borrower.
Adverse Change. A material adverse change occurs in Borrower's
financial condition.
Cure Provisions. If any default, other than a default in payment is
curable and if Borrower has not been given a notice of a breach of the
same provision of this Note within the preceding twelve (12) months,
it may be cured if Borrower, after receiving written notice from
Lender demanding cure of such default: (1) cures the default within
thirty (30) days; or (2) if the cure requires more than thirty (30)
days, immediately initiates steps which Lender deems in Lender's sole
discretion to be sufficient to cure the default and thereafter
continues and completes all reasonable and necessary steps sufficient
to produce compliance as soon as reasonably practical.
LENDER'S RIGHTS. Upon default, Xxxxxx may declare the entire unpaid principal
balance under this Note and all accrued unpaid interest immediately due, and
then Borrower will pay that amount.
ATTORNEYS' FEES; EXPENSES. Lender may hire or pay someone else to help collect
this Note, if Borrower does not pay. Borrower will pay Lender that amount. This
includes, subject to any limits under applicable law, Xxxxxx's attorney's
reasonable fees and Xxxxxx's reasonable legal expenses, whether or not there is
a lawsuit, including without limitation all attorneys' fees and legal
PROMISSORY NOTE Page 3
Loan No.: 1089921654 (Continued)
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expenses for bankruptcy proceedings (including efforts to modify or vacate any
automatic stay or injunction), and appeals. If not prohibited by applicable law,
Xxxxxxxx also will pay any court costs, in addition to all other sums provided
by law.
JURY WAIVER. Xxxxxx and Xxxxxxxx hereby waive the right to any jury trial in any
action, proceeding, or counterclaim brought by either Xxxxxx or Borrower against
the other.
GOVERNING LAW. This Note will be governed by federal law applicable to Lender
and, to the extent not preempted by federal law, the laws of the State of Iowa
without regard to its conflicts of law provisions. This Note has been accepted
by Xxxxxx in the State of Iowa.
CHOICE OF VENUE. If there is a lawsuit, Xxxxxxxx agrees upon Xxxxxx's request to
submit to the jurisdiction of the courts of Linn County, State of Iowa.
RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a
right of setoff in all Borrower's accounts with Lender (whether checking,
savings, or some other account). This includes all accounts Borrower holds
jointly with someone else and all accounts Borrower may open in the future.
However, this does not include any IRA or Xxxxx accounts, or any trust accounts
for which setoff would be prohibited by law. Borrower authorizes Xxxxxx, to the
extent permitted by applicable law, to charge or setoff all sums owing on the
indebtedness against any and all such accounts.
COLLATERAL. Borrower acknowledges this Note is secured by Security Agreement,
Commercial Pledge Agreement, and Master Business Loan Agreement dated 8/30/07.
PURPOSE OF LOAN. The purpose of this loan is for: Refinance SBA Guaranteed
Debentures.
MANDATORY PRINCIPAL REDUCTION. Borrower will be required to apply 80% of cash
proceeds realized from the sale or liquidation of any investments owned by the
Borrower to either of the Promissory Notes dated 8/30/07 as directed by the
Borrower.
SUCCESSOR INTERESTS. The terms of this Note shall be binding upon Xxxxxxxx, and
upon Xxxxxxxx's heirs, personal representatives, successors and assigns, and
shall inure to the benefit of Lender and its successors and assigns.
NOTIFY US OF INACCURATE INFORMATION WE REPORT TO CONSUMER REPORTING AGENCIES.
Please notify us if we report any inaccurate information about your account(s)
to a consumer reporting agency. Your written notice describing the specific
inaccuracy(ies) should be sent to us at the following address: Cedar Rapids Bank
and Trust Company 000 0xx Xxxxxx XX Xxx 000, X.X. Box 789 Cedar Rapids, IA
52406-0789.
GENERAL PROVISIONS. If any part of this Note cannot be enforced, this fact will
not affect the rest of the Note. Lender may delay or forgo enforcing any of its
rights or remedies under this Note without losing them. Borrower and any other
person who signs, guarantees or endorses this Note, to the extent allowed by
law, waive presentment, demand for payment, and notice of dishonor. Upon any
change in the terms of this Note, and unless otherwise expressly stated in
writing, no party who signs this Note, whether as maker, guarantor,
accommodation maker or endorser, shall be released from liability. All such
parties agree that Lender may renew or extend (repeatedly and for any length of
time) this loan or release any party or guarantor or collateral; or impair, fail
to realize upon or perfect Xxxxxx's security interest in the collateral; and
take any other action deemed necessary by Xxxxxx without the consent of or
notice to anyone. All such parties also agree that Xxxxxx may modify this loan
without the consent of or notice to anyone other than the party with whom the
modification is made. The obligations under this Note are joint and several.
PRIOR TO SIGNING THIS NOTE, XXXXXXXX READ AND UNDERSTOOD ALL THE PROVISIONS OF
THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. XXXXXXXX AGREES TO
THE TERMS OF THE NOTE.
XXXXXXXX ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE AND
ALL OTHER DOCUMENTS RELATING TO THIS DEBT.
PROMISSORY NOTE Page 4
Loan No.: 1089921654 (Continued)
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BORROWER:
MORAMERICA CAPITAL CORPORATION
By: /s/ Xxxxx X. Xxxxxxxx
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Xxxxx X. Xxxxxxxx, President of
MorAmerica Capital Corporation
LENDER:
CEDAR RAPIDS BANK AND TRUST COMPANY
By: /s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx, Senior Vice President
