Exhibit 99.13
LOAN AND SECURITY AGREEMENT
THIS LOAN AND SECURITY AGREEMENT (this "Agreement") is made as of
the 29th day of September, by and between PITTSFIELD MOLD & TOOL,
INC., a Massachusetts corporation, with a mailing address for the
purposes hereof at 00 Xxxxx Xxxxxxxxxx Xxxxx, Xxxxxxxxxx,
Xxxxxxxxxxxxx 00000 (the "Borrower") and BERKSHIRE BANK, a
Massachusetts banking corporation with its principal office and
place of business at 00 Xxxxx Xxxxxx, X. X. Xxx 0000, Xxxxxxxxxx,
Xxxxxxxxxxxxx 00000 ("Lender").
W I T N E S S E T H:
FOR CONSIDERATION PAID and to secure payment of that certain loan
in the form of a line of credit facility (the "Loan") from the
Lender to the Borrower evidenced by that certain promissory note
of even date herewith between Borrower, as Maker, and Lender, as
Payee (the "Note") in the original principal amount of ONE MILLION
NINE HUNDRED THOUSAND AND NO/100 DOLLARS ($1,900,000.00) and
SUBJECT TO THE REVOLVING CREDIT AGREEMENT TERMS ON EXHIBIT A
ATTACHED HERETO AND MADE A PART HEREOF and to secure the full
performance by the Borrower of the terms and conditions herein and
in the Note together with any and all other obligations and
liabilities of the Borrower to the Lender including, but not
limited to, any future advances which may be made by the Lender to
the Borrower, with interest thereon and with the provisions for
payment of principal and interest as provided in the Note, and to
secure payment of any other value extended to Borrower from time
to time by the Lender including, but not limited to, reasonable
expenses incurred by the Lender in the protection, enforcement,
collection, realization or disposition of the Collateral, as
hereinafter defined, the Borrower hereby grants to the Lender a
first priority security interest in and to all of the Collateral
(defined below), except Equipment (defined below), and a second
priority security interest in and to the Equipment;
PROVIDED THAT if the Borrower shall well and truly pay the
Indebtedness, as hereinafter defined, in accordance with the terms
of the Note or any renewal, modification or extension thereof, and
shall also pay, when due, all other indebtedness of the Borrower
to the Lender existing at any time prior to the full payment,
satisfaction and discharge hereof, and shall well and truly
perform and observe all covenants, agreements, obligations and
conditions on the Borrower's part to be performed or observed
herein and in the Note, then this Agreement shall cease, determine
and be void; otherwise this Agreement shall remain in full force
and effect for all purposes.
1. Definitions. Borrower and Lender agree that, unless the
context otherwise specifies or requires, the following terms shall
have the meanings herein specified, such definitions to be
applicable equally to the singular and the plural forms of such
terms:
(a) "Accounts Receivable" shall mean and include all rights to
payment created by accounts, accounts receivable, documents,
instruments, chattel paper, general intangibles, patents,
royalties, deposit accounts, notes, drafts, acceptances, and other
forms of obligations and rights to payment of money now due or to
become due under contracts now existing or hereafter made by the
Borrower.
(b) "Collateral" shall mean and include the following property of
the Borrower, whether now owned or hereafter acquired: all
Inventory and Accounts Receivable (each as defined herein), now in
existence or hereafter created, and all replacements thereof,
additions and accessions thereto, substitutions therefor, and all
proceeds and products from the sale, exchange or other disposition
of the foregoing.
(c) "Indebtedness" shall mean (i) the outstanding principal
balance of the Note together with the interest thereon as provided
in the Note and (ii) all other amounts, payments and other
consideration due on account of the Note and/or this Agreement or
the other Loan Documents, as hereinafter defined.
(d) "Interest Rate" shall mean the Interest Rate as defined in the
Note.
(e) "Inventory" shall mean all goods, merchandise, materials, raw
materials, work-in-progress, supplies, finished goods now owned or
hereafter acquired by the Borrower or used or consumed in the
Borrower's business.
(f) "Loan Documents" shall mean this Agreement, the Note, Uniform
Commercial Code Financing Statements issued by Borrower of even
date herewith, a second mortgage and security agreement from the
Borrower to the Lender of even date herewith, the assignment of
rents and leases from the Borrower to the Lender of even date
herewith, the absolute, unconditional, irrevocable guaranty of
repayment of the Loan from United Xxxxxxx Corporation (the
"Guarantor") to the Lender of even date herewith, together with
all other documentation collateral thereto or which may now or
hereafter be given to the Lender by Borrower evidencing, securing
or further securing the Loan, it being understood that to the
extent that any of the terms of the Commitment Letter are in
conflict with the terms of this Agreement, the terms of this
Agreement shall prevail.
(g) "Obligations" shall mean any of the covenants, promises and
other obligations made or owing by the Borrower to or due to the
Lender pursuant to or as otherwise set forth herein or in the Note
or in any other documents, instruments or agreements to which
Borrower is a party or to which Borrower is bound.
(h) "UCC" shall mean the Uniform Commercial Code as adopted and
amended from time to time by the Commonwealth of Massachusetts.
2. Representations and Warranties. Borrower warrants and
represents to the Lender that (i) Borrower will pay the
Indebtedness in the manner described in the Note or in any
modification, renewal or extension, supplementation or replacement
thereof, (ii) the Loan Documents have been duly authorized,
executed and delivered by and on behalf of the Borrower and the
Guarantor, (iii) each of the Borrower and the Guarantor is duly
existing and in good standing with all power, authority, and legal
right to engage in the transactions contemplated by the Loan
Documents, (iv) the execution and delivery of the Loan Documents
and the consummation of the transactions contemplated thereby will
not conflict with or result in a breach of the terms of any
agreement to which the Borrower or the Guarantor is a party and
will not conflict with any law or order of any court, agency or
other governmental body, (v) there are no actions, suits or
proceedings pending, or, to the knowledge of the Borrower,
threatened before any court, any agency or any other governmental
body which could adversely affect the Collateral, Borrower,
Guarantor, or the Borrower's or Guarantor's ability to pay the
Indebtedness and/or perform the Obligations in accordance with the
terms of the Loan Documents, (vi) the Collateral is free from
defects, (vii) the Borrower's title to the Collateral is good and
marketable, free from defects, liens or encumbrances, except the
lien created by this Agreement, and such defects, liens or
encumbrances approved by Lender, if any, and listed on Exhibit B
attached hereto and made a part hereof for all purposes (the
"Permitted Encumbrances"), (viii) the Borrower's name set forth
above is the Borrower's correct legal name and the Borrower has no
other trade name, and the Borrower will not change its legal,
trade, or style name without Lender's prior written consent, (ix)
neither the financial statements or any other document furnished
by the Borrower or the Guarantor to the Lender in connection with
the transaction contemplated by the Loan Documents contain any
untrue statement of a material fact or omit to state a material
fact necessary to prevent the statements contained therein from
being misleading, and (x) there is no fact known to the Borrower
which materially adversely affects, nor, so far as the Borrower
can reasonably foresee, will materially adversely affect the
Borrower's or Guarantor's business, business prospects, financial
condition, operations or properties or the Borrower's or
Guarantor's ability to pay the Indebtedness and/or perform the
Obligations in accordance with the terms of the Loan Documents.
3. UCC Representations. The Borrower warrants that its principal
place of business in Massachusetts is at 00 Xxxxx Xxxxxxxxxx
Xxxxx, Xxxxxxxxxx, Xxxxxxxxxxxxx. The Borrower agrees to maintain
complete and accurate records listing and describing the
Collateral and the location of the Collateral and to deliver such
records to the Lender upon request of the Lender.
4. Affirmative Covenants. Until the Loan is paid in full, the
Borrower shall: (a) keep the Collateral in good order and
condition, damage from casualty expressly not excepted; (b) pay
promptly when due all taxes and assessments of whatever nature
imposed upon the Collateral; (c) maintain insurance at all times
with respect to the Collateral against such risks, in such
amounts, in such form and written by such companies as the Lender
may require, naming the Lender and its successors and assigns, as
their interests may appear, as additional insureds and providing
for twenty (20) days prior notice of cancellation or amendment to
the Lender; (d) deliver all insurance policies covering the
Collateral or certificates evidencing appropriate insurance
coverages to the Lender on the closing date of the transaction
contemplated by the Loan Documents; (e) maintain all of Borrower's
depository accounts with the Lender; (f) reimburse Lender for all
fees and expenses for filing all financing statements and
continuation statements (and any other necessary filings) relating
thereto; and (g) at all times maintain a debt service coverage
ratio of 1.25 times, a current ratio of 1.1 and a quick ratio of
.6. As used herein: (a) "debt service coverage ratio" shall mean
the sum of net income, depreciation, amortization and interest
expenses divided by the total maximum debt service and capital
lease requirements, (b) "current ratio" shall mean the sum of
cash, cash equivalents, accounts receivable and inventory divided
by total current liabilities, and (c) "quick ratio" shall mean the
sum of cash and accounts receivable divided by total current
liabilities. All such ratios shall be determined in accordance
with Generally Accepted Accounting Principals, or so-called "GAAP"
(except that in determining "current ratio" only cash, cash
equivalents, accounts receivable and inventory shall be counted as
current assets.
5. Negative Covenants. Until the Loan is paid in full, the
Borrower shall not: (a) directly or indirectly, create, incur,
assume, or suffer to exist any lien, charge, or encumbrance
(except for Permitted Encumbrances) on or with respect to the
whole or any part of the Collateral; (b) lease or lend any
Collateral except in the ordinary course of Borrower's business
without the express written consent of the Lender; (c) sell or
otherwise transfer the Collateral outside the ordinary course of
Borrower's business and/or for sums less than the cost thereof
without the written consent of the Lender; (d) merge or
consolidate with or into any other company or corporation; (e)
permit or suffer anything to be done which shall have the effect
of materially impairing the value of the security given by the
Borrower to the Lender for the Loan; (f) become a guarantor,
surety or otherwise liable for the debts or other obligations of
any other person or entity, except as an endorser of instruments
for the payment of money deposited to a bank account for
collection in the ordinary course of business; (g) incur any
additional debt without the prior written consent of the Lender,
it being understood that trade debt incurred in the ordinary
course of business shall be permitted, or (h) make any payment,
loan or transfer to the Guarantor or any other Affiliate (as
defined in paragraph 1.02N of Exhibit A attached hereto), except
for the payment of a monthly management fee to United Xxxxxxx
Corporation not to exceed six percent (6%) of gross monthly
revenues; however, notwithstanding the foregoing, if an Event of
Default shall occur, the management payment shall be deferred
until and if the Event of Default is cured.
6. Inspection of Collateral and Books and Records. The Borrower
agrees that the Lender or its agents or representatives, may, at
reasonable times, enter upon the Borrower's premises and inspect
the condition of the Collateral. Borrower agrees that the Lender
or its agents or representatives may, at reasonable times, inspect
the logs and books and records of the Borrower with respect to all
Inventory, and the books and records of the Borrower's business,
and Borrower shall allow the Lender, its agents or representatives
to make copies thereof and extracts therefrom, but the Lender
shall have no duty to make any such inspection and shall not incur
any liability or obligation by reason of not making such
inspection. Borrower shall keep complete and accurate books and
records with respect to the Collateral and the operation of the
Borrower's business and such books and records shall be in form
and substance satisfactory to the Lender.
7. Casualty and Condemnation Award.
(a) Notice to Lender. In the case of any act or occurrence of any
kind or nature which results in damage, loss or destruction to the
Collateral ("Casualty"), or commencement of any proceedings or
actions which might result in a condemnation or other taking for
public or private use of the Collateral or which relates to
injury, damage, benefit or betterment thereto ("Taking"), Borrower
shall promptly notify Lender describing the nature and the extent
of the Taking or the Casualty, as the case may be. Borrower shall
promptly furnish to Lender copies of all notices, pleadings,
determinations and other papers in any such proceedings or
negotiations.
(b) Repair and Replacement. In case of a Casualty or Taking,
Borrower shall promptly (at Borrower's sole cost and expense and
regardless of whether the Insurance Proceeds or the Taking
Proceeds, if any, shall be sufficient or made available to Lender
for the purpose) restore, repair, replace and rebuild the
Collateral as nearly as possible to its quality, utility value,
condition, and character immediately prior to the Casualty or the
Taking, as the case may be.
(c) Insurance Proceeds and Taking Proceeds.
(i) Collection. Borrower shall use its best efforts to collect
the maximum amount of insurance proceeds payable on account of any
Casualty ("Insurance Proceeds"), and the maximum award, payment or
compensation payable on account of any Taking ("Taking Proceeds").
In case of a Casualty, Lender may, in its sole unfettered
discretion, make proof of loss to the insurer, if not made
promptly by Borrower. Borrower shall not settle or otherwise
compromise any claim for Insurance Proceeds or Taking Proceeds
without giving Lender notice thereof at least 10 days in advance.
(ii) Assignment to Lender. Borrower hereby assigns, sets over
and transfers to Lender all Insurance Proceeds and Taking Proceeds
and authorizes payment of such Insurance Proceeds and Taking
Proceeds to be made directly to Lender. Lender shall apply the
Insurance Proceeds and Taking Proceeds first to pay all reasonable
expenses incurred by Lender in connection with the Casualty or
Taking, including, without limitation, attorney's fees and title
fees. Unless Paragraph (d) regarding Insurance Proceeds applies,
Lender may, in its sole unfettered discretion, apply the balance
of such Insurance Proceeds or Taking Proceeds ("Net Proceeds") to
either of the following, or any combination thereof:
(aa) payment of the Indebtedness, either in whole or in party, in
any order determined by Lender in its sole unfettered discretion;
(bb) repair or replacement, either partly or entirely, of any part
of the Collateral so destroyed, damaged or taken, in which case
Lender may impose such terms, conditions and requirements for the
disbursement of the Insurance Proceeds or the Taking Proceeds as
it, in its sole unfettered discretion, deems advisable. Lender
shall not be a trustee with respect to any Insurance Proceeds or
Taking Proceeds, and may commingle Insurance Proceeds or Taking
Proceeds with its funds without obligation to pay interest
thereon.
If any portion of the Indebtedness shall thereafter be unpaid,
Borrower shall not be excused from the payment thereof in
accordance with the terms of the Loan Documents. Lender shall
not, in any event or circumstance, be liable or responsible for
failure to collect or exercise diligence in the collection of any
Insurance Proceeds or Taking Proceeds.
(d) Disbursement of Insurance Proceeds to Borrower. Lender will
disburse the Insurance Proceeds to Borrower provided: (i) there
exists no Event of Default or occurrence or facts which with the
passage of time, the giving of notice, or both, will be an Event
of Default which remains uncured at any time before or during the
Restoration; (ii) the Casualty does not occur within nine months
of the Maturity Date; and (iii) the conditions in this Paragraph 7
are satisfied.
As to any loss or damage which Lender estimates can be repaired
for less that 1/2 of 1% of the then Indebtedness, Lender shall
disburse to Borrower from the Net Proceeds the amount which it
determines is necessary to repair the damage, which amounts shall
be used by Borrower to restore the damage to the property caused
by the Casualty.
As to all other Casualties, Lender shall disburse the Net Proceeds
related thereto to Borrower on the following terms and conditions:
(i) Prior to the first and each subsequent disbursement, Borrower
shall give proof satisfactory to the Lender that:
(aa) Lender is holding a fund comprised of the Net Proceeds and,
if necessary, additional deposits made by Borrower sufficient to
restore the Collateral to its prior condition and use
("Restoration"), together with a fund comprised of Net Proceeds or
funds deposited by Borrower, sufficient to pay operating expenses,
Property Taxes and Charges, the monthly payments (as defined in
the Note) and other so-called "carrying costs" of the property
during the period of Restoration;
(bb) there are no laws preventing Restoration of the Collateral.
Lender shall not be a trustee with respect to any Insurance
Proceeds and may mingle Insurance Proceeds with its funds without
obligation to pay interest thereon. Lender shall in no event be
liable for the performance or observance of any covenant or
condition arising under any lease in connection with the property
nor obligated to take any action to restore the property.
8. Lender Right To Cure And Expenses. The Lender shall be
entitled to, but not obligated to, cure any failure of the
Borrower under the Loan Documents in the performance of the
Obligations and to commence, intervene in or otherwise participate
in any legal or equitable proceeding which, in the Lender's sole
judgement, affects the Collateral or any rights or obligations
created or secured by the Loan Documents. If the Lender shall
become involved in any action or course of conduct with respect to
the Loan Documents or the Collateral in order to cure any default
of the Borrower under the Loan Documents or to protect its
interest in the Collateral, the Borrower shall reimburse the
Lender for all charges, costs and expenses incurred by the Lender
in connection therewith, including, without limitation, reasonable
attorneys' fees. Such charges, costs and expenses described above
shall be payable by the Borrower upon demand of the Lender.
9. Events of Default. The Indebtedness shall become immediately
due and payable by the Borrower, at the option of Lender, if any
of the following events (each an "Event of Default") shall occur
under any of the Loan Documents (including this agreement) and
shall continue beyond applicable grace and cure periods contained
therein, if any:
(a) Borrower fails to pay any interest or principal when due in
accordance with the terms and conditions of the Note;
(b) breach of any other covenant, condition or agreement contained
herein or in the Note or in any of the other Loan Documents
remaining uncured for a period in excess of ten (10) days after
Lender has provided Borrower with written notice of such breach,
provided that in case of any breach which is susceptible to cure
but cannot be cured within ten (10) days through the exercise of
reasonable diligence, so long as the Borrower commences such cure
within ten (10) days, such breach remains susceptible to cure, and
the Borrower diligently pursues such cure, such breach shall not
be deemed to create an Event of Default hereunder;
(c) failure of the Borrower to cause to be dismissed any
proceeding against the Borrower, and, if applicable, any holder of
a general partnership interest in the Borrower, any guarantor of
any of the Borrower's obligations under the Loan Documents or any
endorser of the Note (the Borrower, and, if applicable, any such
general partner, guarantor or endorser hereinafter referred to as
an "Obligor") under any law relating to bankruptcy,
reorganization, insolvency or relief of debtors within ninety (90)
days from the date upon which such proceeding is filed or
instituted, or the filing or other institution of a proceeding by
any Obligor under any such law;
(d) failure of an Obligor to cause to be dismissed a proceeding
for the enforcement of a money judgement instituted against said
Obligor within thirty (30) days from the date upon which such
proceeding is filed and which materially affects the financial
condition of Borrower or instituted unless such proceeding is
contested in good faith by the Obligor and bonded or otherwise
secured to Lender's satisfaction;
(e) the liquidation, termination, dissolution, merger, transfer of
a controlling interest in, or a consolidation of, any Obligor
which is not an individual, the insolvency of any Obligor or the
inability of any Obligor to pay such Obligor's debts when due
(notwithstanding the foregoing, a transfer in the ownership
interest of an Obligor by Xxxxxxx X. Xxxx for estate planning
purposes shall not be an Event of Default hereunder or under any
Loan Document so long as Xxxxxxx X. Xxxx retains direct or
indirect control over the ownership interest); and
(f) material inaccuracy of any statement, representation or
warranty made by the Borrower to the Lender in the Loan Documents
or in any instrument, document or statement hereafter submitted to
the Lender by an Obligor and which results in any loss or damage
to the Lender.
If an Event of Default shall occur and Borrower fails to cure such
Event of Default within the applicable cure periods, then, at the
option of the Lender, without any further notice to the Borrower,
the Indebtedness, together with all other charges due under the
Loan Documents shall be due and payable, and the Lender shall be
entitled to exercise any and all of the rights and remedies
provided for in the Loan Documents or available at law or in
equity, including, but not limited to, all rights and remedies
available to a secured party under the UCC. The Borrower shall,
upon request of the Lender, assemble the Collateral not already in
the Lender's possession and make it available to the Lender at a
place to be designated by the Lender and reasonably convenient to
both the Borrower and the Lender.
10. Application Of Deposits After Default. If the Borrower shall
default in the performance or observance of any covenant or
agreement under the Loan Documents and the Borrower fails to cure
such Event of Default within the applicable cure period, the
Lender may apply any deposit, payment or any sum due from the
Lender to any Obligor toward the Indebtedness in such manner or
order as the Lender, in the exercise of its sole discretion, shall
determine, without first enforcing any other rights of the Lender
against any Obligor or against the Collateral.
11. Separate Foreclosure Sales and Waiver of Marshalling. The
Lender may sell the Collateral and any other security given by the
Borrower for the payment of the Indebtedness and the performance
of the Obligations in one lot or in parts or parcels. Such sales
may be held from time to time by public or private sale and the
power of sale herein given to the Lender shall not be fully
executed until all of the Collateral and other security not
previously sold shall have been sold. The Lender may apply the
net proceeds of any sale, lease or other disposition of the
Collateral to the payment of the Indebtedness and the performance
of the Obligations in such manner and order as the Lender, in the
exercise of its sole discretion, shall determine, after deducting
all costs and expenses of every kind incurred therein or
incidental to the retaking, holding, preparing for sale, selling,
leasing or other disposition of the Collateral or in any way
relating to the protection and/or enforcement of the rights of the
Lender hereunder, including, but not limited to, reasonable
attorney's fees. If the amount realized from such sale, lease or
other disposition of the Collateral is insufficient to satisfy and
discharge the Indebtedness and other charges due and owing by
Borrower to Lender, the Borrower shall remain liable to Lender for
the payment of any such deficiency and interest shall accrue
thereon, until paid, at the Default Rate, as defined in the Note.
If surplus proceeds are realized from such a sale, lease, or other
disposition of the Collateral, the Lender shall not be liable for
any interest thereon pending distribution of such proceeds to the
Borrower. Any separate items of property sold together for a
single price may be accounted for in one account without
distinction between the items of security or without assigning to
them any proportion of such proceeds. The Borrower hereby waives
the application of any doctrine of marshalling of assets.
The Borrower agrees that the requirement of the UCC with respect
to personal property that a secured party give a debtor reasonable
notice of any proposed sale or disposition of collateral shall be
met if such notice is given to Borrower at least five (5) days
before such time of sale or disposition. No such notice need be
given by Lender with respect to collateral which is perishable or
threatens to decline speedily in value or is of a type customarily
sold on a recognized market.
12. Collection of Accounts. The Lender may communicate with
account debtors in order to verify the existence, amount and terms
of any Accounts Receivable and to notify account debtors of the
Lender's security interest in their Accounts Receivable. When
requested by the Lender, the Borrower shall notify account debtors
and indicate on all xxxxxxxx that payments are to be made directly
to the Lender. The Lender may require that payments on Accounts
Receivable be made directly to the Lender and the Lender shall
have full power to collect, compromise, endorse, sell or otherwise
deal with the Accounts Receivable or proceeds thereof and to
perform the terms of any contract in order to create accounts in
the Lender's name or in the name of the Borrower for the business
conducted with respect to the Collateral.
13. Effect of Releases and Waivers. Any failure by Lender to
insist upon the strict performance by Borrower of any of the
Obligations shall not be deemed to be a waiver of the strict
performance of any of the Obligations and Lender, notwithstanding
any such failure, shall have the right thereafter to insist upon
the strict performance by Borrower of any and all of the
Obligations. Neither Borrower nor any other person or entity now
or hereafter obligated for the payment of the whole or any part of
the Indebtedness shall be relieved of such obligation by reason of
(i) the failure of Lender to comply with any request of Borrower,
or of any other person or entity so obligated; (ii) the failure of
Lender to take action in collection or protection of the
Collateral or to otherwise enforce the performance of any of the
Obligations; (iii) the release, regardless of consideration, of
the whole or any part of the security held for the payment of the
Indebtedness and the performance of the Obligations, or (iv) any
agreement or stipulation between the Lender and any subsequent
owner or owners of the equity of redemption in the Collateral
modifying the covenants, terms and provisions of this Loan
Agreement and of the Loan Documents without first having obtained
the consent of Borrower or such other person or entity. In the
last mentioned event, Borrower and all such other persons or
entities shall continue to be liable to make such payments
according to the terms and provisions of the Loan Documents, as
amended, unless expressly released and discharged of record by
Lender. Lender may release, regardless of consideration, any part
of the security held for payment of the Indebtedness and the
performance of the Obligations without, as to the remainder of the
security, in any way impairing or affecting the lien created by
this Agreement or the priority of such lien over any subordinate
lien. Lender may resort for the payment of the Indebtedness and
the performance of the Obligations to any other security therefor
held by Lender, in such manner and order as Lender may elect.
14. WAIVER OF JURY TRIAL. THE BORROWER AND LENDER WAIVE TRIAL BY
JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION
WITH, OR ARISING OUT OF THIS AGREEMENT, ANY OTHER LOAN DOCUMENT,
OR THE INDEBTEDNESS, OR THE VALIDITY, PROTECTION, INTERPRETATION,
COLLECTION OR ENFORCEMENT THEREOF, OR THE RELATIONSHIP BETWEEN
BORROWER AND LENDER AS BORROWER AND LENDER, OR ANY OTHER CLAIM OR
DISPUTE HOWEVER ARISING BETWEEN THE BORROWER AND LENDER.
15. Interest To Accrue. If the Indebtedness shall become due and
payable because of an acceleration by the Lender of the Borrower's
obligation to repay the Indebtedness caused by an Event of Default
hereunder or if the Indebtedness shall mature and become due, then
interest on the Indebtedness shall continue to accrue at the
Default Rate, as defined in the Note, until paid in full.
16. No Set-Off, Counterclaim, etc. The Borrower's obligation to
pay the Indebtedness shall be absolute and unconditional and shall
not be affected by any circumstance, including, without
limitation:
(a) Any set-off, counterclaim, recoupment, defense, or other
right which the Borrower may have against the Lender or anyone
else;
(b) Any defect in title, condition, design, fitness for use, or
operation of, damage to, or loss or destruction of the Collateral,
or any interruption or cessation in the use or possession thereof
by the Borrower for any reason whatsoever;
(c) Any insolvency, bankruptcy, reorganization, or similar
proceedings by or against the Borrower or any guarantor; or
(d) Any other circumstance, happening, or event whatsoever,
whether or not similar to any of the foregoing.
17. Remedies Cumulative. The rights and remedies afforded to
Lender under the Loan Documents shall be cumulative and
supplementary to and not exclusive of any other rights and
remedies which the Lender may have at law or in equity.
18. Further Assurances. The Borrower agrees to execute and cause
to be filed or recorded, and hereby appoints the Lender its duly
authorized attorney-in-fact, which appointment is acknowledged by
the parties hereto to be coupled with an interest, with full power
of substitution and with authority to execute, file and record on
behalf of the Borrower all instruments from time to time deemed by
the Lender to be necessary or appropriate to evidence further the
Indebtedness and/or the Obligations or to secure further to the
Lender the security intended to be provided by this Agreement.
Borrower shall pay, upon demand of the Lender, all costs, expenses
and fees, including, without limitation, reasonable attorneys'
fees, incurred as a result of the operation of this paragraph.
19. Statement of Amount Due. Borrower, within fifteen (15) days
after receipt of a written request from the Lender, shall furnish
a written statement duly acknowledged of the amount due on the
Note to the Lender.
20. Notices. Any notices required or permitted to be given
hereunder shall be: (i) personally delivered or (ii) given by
registered or certified mail, postage prepaid, return receipt
requested, or (iii) forwarded by overnight courier service, in
each instance addressed to the addressee at the address for such
party set forth herein, or such other address as each may
designate in writing to the other. All notices given hereunder
shall be in writing and shall be deemed given, in the case of
notice by personal delivery, upon actual delivery, and in the case
of mail or courier service, upon deposit with the U.S. Postal
Service or delivery to the courier service.
21. Assignment by Lender. The Lender shall have the right at any
time to assign any or all of its right, title, and interest in and
to the Loan Documents and all or any part of the Collateral. Upon
any such assignment, the Lender shall not be deemed the assignee's
agent for any purpose and the Lender may deliver all or any part
of the Collateral held by it to the assignee which shall thereupon
become vested with all rights, powers, and privileges of the
Lender in respect thereto, and the Lender shall thereupon be
forever released and fully discharged from all liability and
responsibility for the whole or any part of the Collateral
transferred. With respect to any Collateral not transferred,
Lender shall retain all powers and rights hereby given to Lender.
This Agreement shall not be assignable by the Borrower without the
prior written consent of the Lender.
22. Interpretation And Binding Effect. This Agreement and the
other Loan Documents constitute the entire agreement between
Borrower and Lender and, to the extent that any writings not
signed by the Lender or oral statements at any time made or had by
either party hereto are inconsistent with the provisions of this
Agreement, the unsigned writings and oral statements shall be null
and void and of no force or effect. The Loan Documents shall be
governed by and construed in accordance with the laws of the
Commonwealth of Massachusetts. If any provision of this Agreement
shall be found unenforceable or invalid for any reason, such
provision shall be deemed modified to the extent necessary to be
enforceable or, if such modification is not practicable, such
provision shall be deemed deleted from this Agreement without
otherwise affecting any other provision of this Agreement. The
headings of sections and paragraphs shall be ignored in
interpreting this Agreement. The word "Borrower", as used herein,
means the Borrower named herein and also means any subsequent
owner or owners of all or any part of the equity of redemption in
the Collateral. All of the covenants and agreements of the
Borrower herein contained shall be binding upon the Borrower, and
(if applicable) its heirs, executors, administrators, successors
and assigns and shall be joint and several if more than one person
constitute the Borrower. The word "Lender", as used herein, means
the Lender named herein and any subsequent holder or holders of
one or both of the Note and this Agreement.
23. Year 2000 Compliance. Borrower represents and warrants that
(a) Borrower has performed a formal assessment of the effect of
year 2000 on Borrower's computer systems and business operations,
(b) Borrower has converted the assessment to a plan ("Year 2000
Compliance Plan") with budget and implementation dates, including
a statement of awareness of the problem, an inventory checklist of
equipment affected, and an assessment of complexity, remediation,
validation, testing and implementation, (c) Borrower has
sufficient resources to implement the Year 2000 Compliance Plan
and (d) the Year 2000 Compliance Plan will be completed by
December 31, 1999.
24. FINANCIAL INFORMATION. Borrower will at all times keep
proper books of records and accounts in which full, true and
correct entries shall be made in accordance with generally
accepted accounting principles and will deliver to Lender within
115 days after the end of each fiscal year a copy of the annual
financial statements of Borrower relating to the prior fiscal year
such statements to include (i) the balance sheet of Borrower as at
the end of such fiscal year and (ii) the related income statement,
statement of retained earnings and statement of changes in the
financial position of Borrower for such fiscal year prepared on an
audit level basis by such certified public accountants as may be
reasonably satisfactory to Lender. Borrower also agrees to
deliver to Lender by within 115 days after the end of each fiscal
year a copy of the Guarantor's year-end form 10-KSB report (or
such other similar report if such report shall no longer be
prepared) and, from time to time, at the request of the Lender,
such other financial information with respect to Borrower and the
Guarantor as the Lender may reasonably request. In addition, the
Borrower shall by the 30th day of each month deliver to the
Lender, management prepared financial statements as of the last
day of the previous month and by the 60th day after the end of a
fiscal quarter each of the Guarantor's quarterly form 10-QSB (or
such other similar report if such report shall no longer be
prepared). All of the foregoing reports and financial statements
will be signed by the chief financial officer of the Borrower and
Guarantor, as the case may be, and certified to the Lender as
being true and accurate.
If the Borrower shall fail to provide the financial statements,
tax returns and other information as required by this paragraph
(i) (a "Financial Information Default"), then, in addition to all
of Lender's other rights and remedies, at Lender's option
commencing three days after written notice (the "Adjustment Date")
of such Financial Information Default is sent by Lender to the
Borrower, the Interest Rate shall be increased by one quarter of
one percent (0.25%) per annum for the first thirty (30) days after
the Adjustment Date, and the Interest Rate shall be increased by
one quarter of one percent (0.25%) 30 days after the Adjustment
Date and each 30 days thereafter, but in no event beyond the
maximum interest rate permitted by applicable law. Such higher
interest rates shall apply to the entire outstanding principal
balance then due under this Note. Effective upon the curing of
such Financial Information Default, as determined by the Lender in
its sole and exclusive discretion, the Interest Rate shall revert
to that set forth in Article I of this Note. Borrower acknowledges
that such increase in the Interest Rate is intended to compensate
Lender for the potentially higher credit risk and increased
administrative costs associated with such failure to furnish
timely financial statements, tax returns and other information.
25. Participation. Lender reserves the right to sell all or any
portion of the Loan to any other party/ies and may deliver to such
party/ies copies of all financial statements, agreements and other
materials supplied to Lender by Borrower and Guarantor, subject
however to such party/ies agreeing to be bound by the
confidentiality agreement in then in force between the Lender, the
Borrower and Guarantor.
IN WITNESS WHEREOF, Borrower has caused this instrument
to be executed by Xxxxxxx X. Xxxx, III, its duly authorized President
and Treasurer, and Lender has caused this instrument to be
executed by Xxxx X. Xxxxxxxxxx, III, its duly authorized Vice
President, and their corporate seals to be hereunto affixed as of
the date first above written.
PITTSFIELD MOLD & TOOL, INC.
By: /s/ Xxxxxxx X. Xxxx, III
Xxxxxxx X. Xxxx, III, President and Treasurer
BERKSHIRE BANK
By: /s/ Xxxx X. Xxxxxxxxxx, III
Xxxx X. Xxxxxxxxxx, III, Vice President
COMMONWEALTH OF MASSACHUSETTS
BERKSHIRE, ss. September 29, 1999
Then personally appeared the above-named, who acknowledged the
foregoing instrument to be the free act and deed of Pittsfield
Mold & Tool, Inc., before me,
/s/ Xxxxxx X. Denmark
Xxxxxx X. Denmark, Notary Public
My Commission Expires: 7/27/01
EXHIBIT B TO
LOAN AND SECURITY AGREEMENT
PERMITTED ENCUMBRANCES
