EXHIBIT 10.57
RESIDUAL SHARING NOTE PAYABLE
$ 111,500.00 Dated as of June 1, 1997
FOR VALUE RECEIVED, the undersigned, CAPITAL ASSOCIATES INTERNATIONAL INC.
("CAII") hereby agrees to pay to XXXXXXX X. XXXXXXXX at 0000 Xxxxxxxxxx Xxxxx -
Xxxxx 0000, XxXxxx, Xxxxxxxx 00000 ("Buckland"), without set-off or defense,
solely out of 2.70735 percent of the residual proceeds derived from the
Equipment (defined below) subject to the Existing Underlying Leases (defined
below) described in the SCHEDULE A attached hereto and made a part hereof
("Residual Proceeds") and without additional recourse to CAII, the sum of One
Hundred Eleven Thousand Five Hundred and No/100 Dollars ($ 111,500.00) and any
excess that may be realized, which shall be deemed contingent interest. Subject
to the provisions with respect to prepayment set forth in SECTION 3 below, the
amount due hereunder shall become due to Buckland on the expiration dates of the
Existing Underlying Leases and payable to Buckland on such earlier or later
date(s) when CAII actually receives the Residual Proceeds.
1. BACKGROUND
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CAII is a party to certain purchase agreements ("Purchase Agreements") and
assignments of leases ("Assignments of Leases"), pursuant to which CAII has sold
and assigned the equipment ("Equipment") and the leases with respect thereto
("Existing Underlying Leases") described on the SCHEDULE A attached hereto. The
parties ("Parties") listed in SCHEDULE A and CAII have also entered into
remarketing agreements pursuant to which CAII is responsible for remarketing the
Equipment ("Remarketing Agreements") and will be compensated for such services
by sharing a portion of the Residual Proceeds.
This Agreement is a non-negotiable, non-recourse promissory note and shall be so
construed. Payment hereunder is to be made only from and to the extent of the
Residual Proceeds actually received by CAII, which are payable by the Parties to
CAII pursuant to the Purchase Agreement and/or Remarketing Agreements, and not
otherwise.
2. SECURITY INTEREST
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CAII hereby grants, conveys, assigns and transfers to Buckland a Uniform
Commercial Code ("UCC") security interest in 2.70735 percent of CAII's interest
in the Residual Proceeds. The grant of the security interest contained herein is
subject and subordinate to the rights of the holders of Permitted Liens (defined
below), as well as the rights of the lessees under the Existing Underlying
Leases and any extensions thereof. Payment by CAII shall be due and payable
within five (5) business days after collection by CAII of the net Residual
Proceeds (if any) received by CAII from any sale, lease or other disposition of
the Equipment after the obligations under the Remarketing Agreements and
Permitted Liens are satisfied.
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As used herein, the term "Permitted Liens" means the UCC security interests, if
any, granted to a lender of the non-recourse financing obtained by CAII on any
of the Existing Underlying Leases.
3. PREPAYMENT
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The amounts payable under this Agreement may be prepaid at any time and from
time to time and shall be prepaid if the Residual Proceeds are received earlier
than expected (e.g., upon a casualty or an early termination of the Underlying
Leases).
4. DEFAULT
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4.1 EVENT OF DEFAULT. The term "Event of Default" as used herein shall mean
the occurrence and continuation of any one or more of the following
events:
(a) The failure of CAII to promptly remit any of the Subject Proceeds
received by it, which failure continues for ten (10) days after receipt of
written notice of such failure;
(b) If CAII shall:
(i) make an assignment for the benefit of its creditors;
(ii) consent to the appointment of a receiver for itself or for
the whole or substantially all of its property;
(iii) file a petition or answer seeking or consenting to
reorganization or arrangement or other aid or relief under
any bankruptcy or insolvency laws or any other law for the
relief of debtors; or
(iv) Default under any other provision of this Agreement.
4.2 REMEDIES. Upon an Event of Default, CAII shall execute such additional
documents as Buckland may reasonably request to confirm Xxxxxxxx'x rights in the
in the Residual Proceeds (which may include but is not limited to a written
direction to the lessees under the Existing Underlying Leases or those in
possession of the Equipment specifying Xxxxxxxx'x interest in the Residual
Proceeds and requesting that it be apportioned and paid to CAII and Buckland
pursuant to their respective interests therein. Xxxxxxxx'x rights and remedies,
whether pursuant hereto or pursuant to the UCC or any other statute or rule of
law conferring rights similar to those conferred by the UCC, shall be cumulative
and not in the alternative.
5. NOTICES
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Any notice, request or other communication to either party by the other
hereunder shall be given in writing and shall be deemed given upon personal
delivery or three (3) days after the date the same is mailed by certified mail,
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return receipt requested, postage prepaid, and addressed to the party for which
it is intended at the address set forth in this Agreement. The place to which
notices or copies of notices are to be given to either party may be changed from
time to time by such party by written notice to the other party.
6. MISCELLANEOUS
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6.1 RESTRICTIONS ON TRANSFER. CAII and Buckland shall not sell, transfer,
encumber, grant, or permit as a result of CAII's or Buckland's acts or
omissions, any lien or security interest with respect to the Residual Proceeds
(other than the Permitted Liens and the lien created pursuant hereto) or
otherwise dispose of all or any portion of the Residual Proceeds without the
prior written consent of the other party hereto, which consent shall not be
unreasonably withheld or delayed. Any such transfer by CAII will be subject to
Buckland's rights pursuant to this Agreement.
6.2 FINANCING STATEMENTS. XXXX xxxxxx authorizes Buckland from time to time to
file financing or other statements in such form as may be necessary to perfect a
security interest in the Residual Proceeds in any and all relevant jurisdictions
and, in this regard, to execute and record such UCC-1 Financing Statements for
himself, as secured party, and for CAII, as debtor, as its agent.
6.3 COURSE OF DEALING. No delay in exercising any rights or remedies hereunder
or under any communication, report, notice or other document or instrument
referred to herein, shall operate as a waiver of any of the rights and remedies
of CAII and Buckland.
6.4 AMENDMENTS. This Agreement may be amended or varied only by a document, in
writing, of even or subsequent date hereof, executed by XXXX and Buckland and
specifically identifying and incorporating this Agreement therein.
6.5 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND INTERPRETED UNDER
THE LAWS OF THE STATE OF COLORADO APPLICABLE TO CONTRACTS MADE AND TO BE
PERFORMED THEREIN WITHOUT GIVING EFFECT TO THE PRINCIPLES OF CONFLICT OF LAWS
THEREOF.
6.6 SUCCESSORS AND ASSIGNS. Subject to SECTION 6.1, this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
6.7 SEVERABILITY. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any of the other
provisions herein.
6.8 HEADINGS. The descriptive headings in this Agreement are for convenience
of reference only, and shall not be deemed to affect the meaning or construction
of any of the provisions hereof.
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IN WITNESS WHEREOF, XXXX and Xxxxxxxx have executed this Agreement on the day
and year first above written.
"CAII"
CAPITAL ASSOCIATES INTERNATIONAL, INC. Address:
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxx 0000
By: /s/Xxxxxx Xxxxx Lakewood, Colorado 80235
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Title: President and CEO
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"Buckland"
/s/X. X. Xxxxxxxx
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XXXXXXX X. XXXXXXXX
