$1,000,000.00 Charlotte NC SEPTEMBER 19, 1996
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(City) (State) (Date)
For value received, the undersigned (whether one or more, hereinafter called the "Obligors") promise(s) to pay to the order
of SouthTrust Bank of North Carolina (hereinafter called the "Bank" or, together with any any other holder of this note, the
"Holder"), at any office of the Bank in Charlotte, NC, or at such other place as the Holder may designate, the sum of ONE
MILLION AND NO/100 Dollars, together with interest thereon at the rate and on the date(s) provided below from the date of this
note until maturity, and with interest on the aggregate unpaid principal and accrued interest after maturity at the rate which
is 2 percent per annum in excess of the rate stated below or the maximum rate allowed by law, whichever is less, from maturity
until and aggregate indebtedness is paid in full.
/X/ VARIABLE RATE
Except as otherwise provided in this note, interest will accrue on the above-stated principal sum at the rate per annum which
is _________ percentage points in excess of the Base Rate. As used in this note, the term "Base Rate" means the rate of
interest designated by the Bank periodically as the Base Rate. The Base Rate is not necessarily the lowest rate charged by the
Bank. The Base Rate on the date of this note is ______________ percent. The rate of interest payable under this note will
change to reflect any change in the Base Rate:
/ / on any day the Base Rate changes. / / on the _____________ day of each month thereafter.
/ / on the day each payment of interest is due as provided below. /X/ See attached Addendum P.S
Obligors may prepay this note in full at any time without penalty.
/ / FIXED RATE
Except as otherwise provided in this note, interest will accrue on the above-stated principal sum at the rate of ____________
percent per annum from the date of this note until maturity.
The above-stated principal sum shall be paid in full:
/ / on ______________________. / / on demand. /X/ on demand, but if no demand is made, then on FEBRUARY 17, 1999
Accrued interest on the unpaid balance of the principal sum shall be paid:
/X/ monthly on the 17th day of each month beginning OCTOBER 17, 1996, and at maturity.
/ / quarterly beginning on ______________________________, on the same day every three months thereafter, and at maturity.
Until the earlier of maturity of this note, or the occurrence of any event giving Bank the right to accelerate maturity of this
note as provided below, or written or oral notice to any Obligor of Bank's election to terminate the line of credit (which
notice Bank may give at its discretion), the undersigned may borrow hereunder, prepay the principal sum in whole or in part
without penalty, and reborrow hereunder, so long as the aggregate unpaid principal balance of such borrowings does not exceed
the principal amount of this note at any time. Bank may require that borrowings be made only upon at least one banking day's
written notice to Bank. For the privilege of having such credit available, the undersigned agrees to pay Bank a commitment fee
of n/a percent per annum on the unused portion of the principal sum of this note, such fee to be calculated and payable as
follows: ______________________________________________________________________________________________________________________
_______________________________________________________________________________________________________________________________
The rate of interest under this note may increase upon the occurrence of certain events described on the back of this page.
Interest on the principal sum will be calculated at the rate provided in this note on the basis of /X/ 360 / / 365 day year
and the actual number of days elapsed by multiplying the principal sum by the per annum rate set forth above, multiplying the
product thereof by the actual number of days elapsed, and dividing the product so obtained by /X/ 360 / / 365.
LOAN FEE (this provision applicable only if completed): A loan fee in the amount of $3,000.00 has been / / advanced to
Obligors as a loan under this note and paid to the Bank /X/ paid to the Bank by cash or check at closing. The loan fee is
earned by the Bank when paid and is not subject to refund except to the extent required by law.
LATE CHARGE: If this note is payable in installments of interest or principal and interest, and if any scheduled payment is
late 15 days or more. Obligors agree to pay a late charge equal to 4% of the amount of the payment which is late, but not more
than the maximum amount allowed by applicable law.
This note is secured by every security agreement, pledge, assignment, stock power, deed of trust and/or mortgage covering
personal or real property (all of which are hereinafter included in the term "Separate Agreements") which secures an obligation
so defined as to include this note, including without limitation all such Separate Agreements which are of even date herewith and
delivered to the Bank and/or described in the space below. In addition, as security for the payment of any and all liabilities
and obligations of the Obligors to the Holder (including the Indebtedness evidenced by this note and all extensions, renewals,
and substitutions thereof) and all claims of every nature of the Holder against the Obligors, whether present or future, and
whether joint, several, absolute, contingent, matured, unmatured, liquidated, unliquidated, direct or indirect (all of the
foregoing are hereinafter included in the term "Obligations") the Obligors hereby grant to the Holder a security interest in and
security title to the property described below: (Describe Separate Agreement and Collateral)
As further described in Security Agreement dated September 19, 1996, Pledge
and Security Agreement dated September 19, 1996 executed by Jacksonville
Hygiene, Inc., SaniTec Hygiene, Inc., Xxxxxxx Hygenic Services, Inc. and
Xxxxxxx International of Charlotte, Inc. and Assignment and Pledge of
Savings or other Deposit Account dated September 19, 1996.
If this note is payable on demand, or on demand but not later than a stated date, all of the Obligations shall be due and
payable in full upon demand by Holder, whether or not any default described below has occurred and whether or not the Holder
reasonably deems itself to be insecure. If this note has no provision for payment on demand, the following terms apply: if
default occurs in the payment of any of the Obligations when due or with respect to any condition or agreement contained in this
note; or if for any reason whatever the Collateral shall cease to be satisfactory to the Holder; or in the event of death (if an
individual) or dissolution (if a partnership or corporation) of, insolvency of, general assignment by, filing of petition
under any chapter of the Federal Bankruptcy Code by or against, filing of application in any court for receiver for, judgment
against, issuance of any writ of execution, attachment or garnishment against, or against any of the property of, any Obligor
or any indorser or guarantor of this note (or any general partner of any Obligor or any indorser of any guarantor); or if there
occurs any default or event authorizing acceleration as contained in any Separate Agreement; or if at any time in the sole
opinion of the Holder the financial responsibility of any Obligor or any indorser or guarantor of this note shall become
impaired; then, if any of the foregoing occur, all unpaid amounts of any and all of the Obligations shall, the the option of
the Holder and without notice or demand, become immediately due and payable, notwithstanding any time or credit allowed under any
of the Obligations or under any instrument evidencing the same.
With respect to any and all Obligations, the Obligors and any indorsers of this note severally waive the following: (1) to
the extent permitted by applicable law, all rights of exemption of property from levy or sale under execution or other process
for the collection of debts under the constitution and laws of the United States or of any state thereof; (2) demand;
presentment, protest, notice of dishonor, still against any party and all other requirements necessary to change or hold any
Obligor liable on any Obligation; (3) any further receipt for or acknowledgment of the Collateral now or hereafter deposited
or statement of indebtedness; (4) all statutory provisions and requirements for the benefit of any Obligor, now or hereafter
in force (to the extent that same may be waived); (5) the right to interpose any set-off or counterclaim of any nature or
description in any litigation in which the Holder and any Obligor shall be adverse parties. The Obligors severally agree that
any Obligations of any Obligor may, from time to time, in whole or in part, be renewed, extended, modified, accelerated,
compromised, discharged or released by the Holder, and any Collateral, lien and/or right of set-off securing any Obligation may,
from time to time, in whole or in part, be exchanged, sold, or released, all without notice to or further reservations of
rights against any Obligor and all without in any way affecting or releasing the liability of any Obligor. The Obligors jointly
and severally agree to pay all filing fees and taxes in connection with this note or the Collateral and all costs of
collecting or securing or attempting to collect or secure any Obligations, including a reasonable attorney's fee if an attorney,
not a salaried employee of the Holder, is consulted with reference to sum or otherwise.
The Obligors shall be jointly and severally liable for all indebtedness represented by this note and have subscribed their
names hereto without condition that anyone else should sign or become bound hereon and without any other condition whatsoever
being made. The provisions printed on the back of this page are a part of this note. The provisions of this note are binding
on the heirs, executors, administrators, assigns and successors of each and every Obligor and shall inure to the benefit of the
Holder, as successors and assigns. This note is executed under the seal of each of the Obligors and of the Indorsers, if any.
Obligor's Tax I.D. #: 00-0000000 Xxxxxxx International, Inc. (SEAL)
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No. By /s/ Xxxxxxx X. Xxxxxxx CEO
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Xxxxxxx X. Xxxxxxx Title
Officer: Xxxxxxx X. Xxxxxxxxx #190 Signature (SEAL)
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Branch: Xxxxxxxx Xxxx./CLDC Xxxxxxx Creek Signature (SEAL)
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The provisions on the reverse side are a part of this note.
ADDITIONAL TERMS AND CONDITIONS OF REVOLVING NOTE
(TERMS CONTINUED FROM REVERSE SIDE)
Each Obligor and each guarantor and indorser agrees (a) in the event such
Obligor, guarantor or indorser is other than an individual, to furnish the
Holder at least annually, within 120 days after the end of each calendar year or
other fiscal year of such entity, a current financial statement, including a
balance sheet and statements of income, cash flows and changes in capital for
such year, setting forth in each case in comparative form the corresponding
figures for the previous year, together with accompanying schedules and
footnotes along with the accountant's letter accompanying the financial
statements (if the financial statements were compiled or certified by a
public accountant), such financial statements to be certified by the chief
executive officer, chief financial officer, managing partner or comparable
financial officer of such Obligor, guarantor or indorser to be true and
complete to the best of his or her knowledge and belief and to have been
prepared in accordance with generally accepted accounting principles or, if
not so prepared, setting forth the manner in which such financial statement
departs from generally accepted accounting principles; (b) in the event
such Obligor, guarantor or indorser is an individual, to furnish the Holder
at least annually, within 90 days after each anniversary date of this note, a
personal financial statement in form satisfactory to the Holder, certified
by such person to be true and complete to the best of his or her knowledge
and belief, and to furnish the Holder, within 30 days after the Holder's
request therefor, a copy of the federal income tax return most recently filed
by such person; and (c) that this paragraph applies in addition to and not in
lieu of any other agreement with the Holder which requires the furnishing of
financial information.
If any Obligor, guarantor or indorser falls or refuses to furnish financial
information to the Holder under the preceding paragraph or under the terms of
any other agreement with the Holder which requires the furnishing of financial
information, the Holder, without waiving its right to treat such failure or
refusal as a default under this note, may give written notice to Obligors that
the Holder has not received the required financial information and that the
Holder intends to increase the interest rate under this note if the required
information is not received within 30 days after the date of the notice. If
the required information is not received by the Holder within 30 days after
the date of the notice, at the Holder's option, the rate of interest payable
under this note will increase by 1% per annum. At the Holder's option, the rate
of interest payable under this note will increase by an additional 1% per
annum each 30 days until the required financial information is received by
the Holder, subject of a maximum increase of 4% per annum under the
provisions of this paragraph. Any such increase(s) in the rate of interest
will remain in effect until 30 days after the required information is received
by the Holder. The provisions of this paragraph do not apply if the original
principal amount of this note is $25,000 or less.
As additional Collateral for the payment of all Obligations, the Obligors
jointly and severally transfer, assign, pledge, and set over to the Holder and
grant the Holder a continuing lien upon and security interest in, any and all
property of each Obligor that for any purpose, whether in trust for any Obligor
or for custody, pledge, collection or otherwise, is now or hereafter in the
actual or constructive possession of, or in transit to, the Holder in any
capacity, its correspondents or agents, and also a continuing lien upon and
or right of set-off against all deposits and credits of each Obligor with, and
all claims of each Obligor against, the Holder now or at any time hereafter
existing. The Holder is hereby authorized, at any time or times and without
prior notice, to apply such property, deposits, credits, and claims, in whole
or in part and in such order as the Holder may elect, to the payment of, or
as a reserve against, one or more of the Obligations, whether other
Collateral therefor is deemed adequate or not. All such property, deposits,
credits and claims of the Obligors are included in the term Collateral,
and the Holder shall have (unless prohibited by law) the same rights with
respect to such Collateral as it shall have with respect to other Collateral.
Without the necessity for notice to or consent of any Obligor, the Holder
may exercise any rights of any of the Obligors with respect to any Collateral,
including without limitation thereto the following rights: (1) to record or
register in, or otherwise transfer into, the name of the Holder or its
nominee any part of the Collateral, without disclosing that the Holder's
interest is that of a secured party; (2) to pledge or otherwise transfer any
or all of the Obligations and/or Collateral, whereupon any pledgee or
transferee shall have all the rights of the Holder hereunder, and the Holder
shall thereafter be fully discharged and relieved from all responsibility and
liability for the Collateral so transferred but shall retain all rights and
powers hereunder as to all Collateral not so transferred; (3) to take
possession of any Collateral and to receive any proceeds of and dividends and
income on any Collateral, including money, and to hold the same as Collateral
or apply the same to any of the Obligations, the manner, order and extent of
such application to be in the sole discretion of the Holder; (4) to exercise
any and all rights of voting, conversion, exchange, subscription or their
rights or options pertaining to any Collateral; and (5) to liquidate, demand,
sue for, collect, compromise, receive and receipt for the cash or surrender
value of any Collateral, if for any reason whatsoever the Collateral shall
cease to be satisfactory to the Holder, the Obligors shall upon demand deposit
with the Holder additional Collateral satisfactory to the Holder. Surrender of
this note, upon payment or otherwise, shall not affect the right of the Holder
to retain the Collateral as security for other Obligations. Upon default, the
Obligors agree to assemble the Collateral and make it available to Holder at
such place or places as the Holder shall designate.
The Holder shall be deemed to have exercised reasonable care in the custody
and preservation of any of the Collateral which is in its possession if it
takes such reasonable actions for that purpose as the pledgor of such
Collateral shall request in writing, but the Holder shall have sole power to
determine whether such actions are reasonable. Any omission to do any act
not requested by said pledgor shall not be deemed a failure to exercise
reasonable care. The Obligors shall be responsible for the preservation of the
collateral and shall take all steps to preserve rights against prior parties.
The Holder shall have the right to, but shall not be obligated to, preserve
rights against prior parties; nor shall the Holder be liable for any failure to
realize upon, or to exercise any right or power with respect to, any of the
Obligations or Collateral, or for any delay in so doing.
The Holder, without making any demands whatsoever, shall have the right to
sell all or part of the Collateral, although the Obligations may be contingent
or unmatured, whenever the Holder considers such sale necessary for its
protection. Sale of the Collateral may be made, at any time and from time to
time, at any public or, unless prohibited by applicable law at, private
sale, at the option of the Holder, without advertisement or notice to any
Obligor, except such notice as is required by law and cannot be waived. The
Holder may purchase the Collateral at any such sale (unless prohibited by law)
free from any equity or redemption and from all other claims. After deducting
all expenses, including legal expenses and attorney's fees, for maintaining or
selling the Collateral and collecting the proceeds of sale, the Holder shall
have the right to apply the remainder of said proceeds in payment of, or as a
reserve against, any of the obligations, the manner, order and extent of such
application to be in the sole discretion of the Holder. To the extent notice of
any sale or other disposition of the Collateral is required by law to be
given to any Obligor, the requirement of reasonable notice shall be met by
sending such notice, as provided below, at least ten (10) calendar days
before the time of sale or disposition. The Obligors shall remain liable to
the Holder for the payment of any deficiency, with interest at the rate
provided hereinabove. However, the Holder shall not be obligated to resort to
any Collateral but, at its election, may proceed to enforce any of the
Obligations in default against any or all of the Obligors.
The Obligors understand that the Bank may enter into participation
agreements with participating banks whereby the Bank will sell undivided
interests in this note to such other banks. The Obligors consent that the
Bank may furnish information regarding the Obligors, including financial
information, to such banks from time to time, and also to prospective
participating banks in order that such banks may make an informed decision
whether to purchase a participation in this note. The Obligors hereby grant
to each such participating bank, to the extent of its participation in this
note, the right to set off deposit accounts maintained by the Obligors, or any
of them, with such bank against unpaid sums owed under this note. Upon written
request from the Holder, the Obligors agree to make each payment under this
note directly to each such participating bank in proportion to the
participant's interest in this note as set forth in such request from
the Holder.
If, at any time, the rate of interest payable under this note shall exceed
the maximum rate of interest permitted by applicable law, then, for such time
as the interest rate would be excessive, its application shall be suspended and
there shall be charged instead the maximum rate of interest permitted under such
law, and any excess interest paid by the Obligors or collected by the Holder
shall be refunded to the Obligors or credited against the principal sum of
this note, at the election of the Holder or as required by applicable law.
The Holder shall not by any act, delay, omission or otherwise be deemed to
have waived any of its rights or remedies, and no waiver of any kind shall be
valid, unless in writing and signed by the Holder. All rights and remedies
of the Holder under the terms of this note and under any statutes or rules of
law shall be cumulative and may be exercised successively or concurrently. The
Obligors jointly and severally agree that the Holder shall be entitled to all
the rights of a holder in due course of a negotiable instrument. This
note shall be governed by and construed in accordance with the substantive
laws of the United States and the state where the office of the Bank set
forth above in the first paragraph of this note is located, other than the
rules of such state governing conflicts of law. Any provision of this note
which may be unenforceable or invalid under any law shall be ineffective to
the extent of such unenforceability or invalidity without affecting the
enforceability or validity of any other provision hereof. Any notice required
to be given to any person shall be deemed sufficient if delivered to such
person or if mailed, postage prepaid, to such person's address as it
appears on this note or, if none appears, to any address of such person in
the Holder's files. The Holder shall have the right to correct patent errors
in this note. A photocopy of this note may be filed as a financing statement in
any public office.
EACH GUARANTOR AND INDORSER OF THIS NOTE AGREES TO BE BOUND BY THE PROVISIONS
PRINTED OR OTHERWISE APPEARING ABOVE AND ON THE FACE OF THIS NOTE, INCLUDING
THE PROVISION FOR PAYMENT OF ATTORNEYS' FEES FOR COLLECTION, AND EACH
GUARANTOR AND INDORSER HEREBY WAIVES ANY RIGHTS HE OR IT MAY HAVE UNDER NORTH
CAROLINA GENERAL STATUTES SECTIONS 26-7 ET SEQ.
Signature (SEAL) Signature (SEAL)
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Address Address
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Signature (SEAL) Signature (SEAL)
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Address Address
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NC52718 SouthTrust Corporation (3/93)
ADDENDUM TO REVOLVING NOTE BY AND BETWEEN XXXXXXX
INTERNATIONAL, INC. AS "OBLIGOR" AND SOUTHTRUST BANK OF NORTH
CAROLINA AS THE "BANK DATED SEPTEMBER 19,1996.
Interest will accrue on the above stated principal amount at the rate per
annum which is 2.85% above the ninety (90) day London Interbank Offering Rate
(LIBOR) as quoted in the Wall Street Journal. The rate of interest under
this note will change to reflect any change in the index every ninety (90)
days. The ninety (90) day London Interbank Offering Rate on the day of this
note is 5.66%.
Xxxxxxx International, Inc.
By /s/ XXXXXXX X. XXXXXXX
--------------------------------
Xxxxxxx X. Xxxxxxx, CEO
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REVOLVING LOAN AGREEMENT
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This Agreement dated SEPTEMBER 19, 1996, made by and between Xxxxxxx
International, Inc. ("Borrower") and SouthTrust Bank of North Carolina
("Bank")
WITNESSETH:
That for valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, and in consideration of the mutual promises herein made,
Bank and Borrower, intending to be legally bound, agree as follows:
ARTICLE I - THE REVOLVING LOAN
SECTION 1.1 Bank hereby agrees to lend to Xxxxxxxx, and Xxxxxxxx hereby
agrees to borrow from Bank, upon the terms and conditions, set forth in this
Agreement, the principal sum of up to ONE MILLION AND NO/100 dollars
($1,000,000.00) (the "Revolving Loan"). Xxxxxxxx's obligation to repay the
Revolving Loan and the interest thereon shall be evidenced by a promissory
note (the "Note") in form and substance satisfactory to Bank. Until the
earlier of FEBRUARY 17, 1999 or the occurrence of any Event of Default (as
defined under Article VI of this Agreement), or written notice to Borrower of
Bank's election to terminate the availability of new loans under this
Agreement (which notice Bank may give at its discretion, whether or not an
Event of Default has occurred or is threatened). Borrower may borrow
hereunder, prepay the principal sum of such loans in whole or in part without
penalty, and reborrow hereunder, so long as the aggregate unpaid principal
balance of such loans does not exceed the maximum principal amount set forth
in the first sentence of this Section 1.1. Bank may require at any time that
loans be made upon at least one banking day's notice to Bank. Bank may also
require at any time that loans be requested in writing on Bank's loan request
form. Bank may disburse each loan by credit to Xxxxxxxx's transaction account
with Bank, by check, or in such other manner as Borrower and Bank may agree.
SECTION 1.2. Xxxxxxxx agrees to pay interest on the Revolving Loan at
the rate(s), on the date(s), and calculated by the method, set forth in the
Note.
SECTION 1.3. Unless payment is required to be made earlier under the
terms of the Note or pursuant to Section 6.2 of this Agreement following an
Event of Default, Borrower shall pay the unpaid principal balance of the
Revolving Loan in full on the maturity date of the Note.
SECTION 1.4. For the privilege of having the Revolving Loan available,
until the earlier of the termination of this Agreement or the effective date
of Bank's election to terminate the availability of new loans, Borrower
agrees to pay to Bank a commitment fee of 0.00% per annum on the unused
portion of the maximum principal amount of the Revolving Loan, such fee to be
calculated and paid as follows:
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ARTICLE II - COLLATERAL
Section 2.1. The repayment by Borrower of the indebtedness under the
Revolving Loan and the Note, and the performance by Borrower of all
obligations under this Agreement, are and shall be secured by every mortgage,
deed of trust, and security agreement (every "Separate Agreement") which
secures an obligation so defined as to include the Revolving Loan or the Note
(including, without limitation, those Separate Agreements described below),
and by all property of Borrower now or hereafter in the possession, control
or custody of Bank (in which property Borrower hereby grants Bank a security
interest to secure such indebtedness and obligations) and by all property in
which Bank has or hereafter acquires a lien, security interest, or other
right, including, without limitation, the property described below (in which
property Borrower hereby grants Bank a security interest to secure such
indebtedness and obligations)
As further described in Security Agrement dated September 19, 1996,
Pledge and Security Agreement dated September 19, 1996 executed by
Jacksonville Hygiene, Inc., SaniTec Hygiene, Inc., Xxxxxxx Hygenic Services,
Inc. and Xxxxxxx International of Charlotte, Inc. and Assignment and Pledge
of Savings or Other Deposit Account dated September 19, 1996.
(The property described above and the property described in every Separate
Agreement is individually and collectively referred to in this Agreement as
the "Collateral").
SECTION 2.2. Borrower shall execute and deliver, or shall cause to be
executed and delivered, such documents relating to the Collateral as Bank may
from time to time request.
ARTICLE III - BORROWER WARRANTS AND REPRESENTS TO BANK THAT:
SECTION 3.1 Borrower is a Corporation duly organized and existing under
the laws of the State of North Carolina, and is qualified to do business in
all jurisdictions in which it conducts its business.
SECTION 3.2. The execution and delivery by Xxxxxxxx of, and the
performance by Borrower of its obligations under, this Agreement, the Note
and the Separate Agreements have been duly authorized by all requisite action
on the part of Borrower and do not and will not (i) violate any provision of
Borrower's articles of incorporation, by-laws, or other organizational
documents, any law or any judgment, order or ruling of any court or
governmental agency, or (ii) be in conflict with, result in a breach of, or
constitute, following notice or lapse of time or both, a default under any
indenture, agreement or other instrument to which Borrower is a party or by
which Borrower or any of its property is bound.
SECTION 3.3. Each of this Agreement and the Note is the legal, valid and
binding agreement of Borrower enforceable against Borrower in accordance with
its terms.
SECTION 3.4. There are no pending or threatened actions or proceedings
before any court or administrative or governmental agency that may,
individually or collectively, adversely affect the financial condition or
business operations of Borrower.
SECTION 3.5. The financial statement dated OCTOBER 31, 1995, previously
delivered by Borrower to Bank, fairly and accurately presents the financial
condition of Borrower as of such date and has been prepared in accordance
with generally accepted accounting principles consistently applied. Since
the date of that financial statement, there has been no material adverse
change in the financial condition of Borrower, and, after due inquiry, there
exists no material contingent liability or obligation assertable against
Borrower.
SECTION 3.6. All federal, state and other tax returns of Borrower
required by law to be filed have been completed in full and have been duly
filed, and all taxes, assessments, and withholdings shown on such returns or
billed to Borrower have been paid, and Borrower maintains adequate reserves
and accruals in respect of all such federal, state and other taxes,
assessments and withholdings. There are no unpaid assessments pending
against Borrower for any taxes or withholdings, and Borrower knows of no
basis therefor.
SECTION 3.7. The obligations of Borrower under this Agreement and the
Note are not subordinated in right of payment to any other obligation of
Borrower.
SECTION 3.8. Borrower possesses all permits, memberships, franchises,
contracts, licenses, trademark rights, trade names, patents, and other
authorizations necessary to enable it to conduct its business operations as
now conducted, and no filing with, and no consent, permission, authorization,
order or license of, any individual, entity, or governmental authority is
necessary in connection with the execution, delivery, performance or
enforcement or this Agreement or the Note.
SECTION 3.9. No event has occurred and is continuing which is, or which
with the giving of notice or lapse of time or both would be, an Event of
Default (as defined in Article VI) of this Agreement.
SECTION 3.10. Borrower has good and marketable title to all of its
properties and assets including, without limitation, the Collateral and the
properties and assets reflected in the above-described financial statement.
SECTION 3.11. The minimum funding standards of Section 302 of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA") have
been met at all times with respect to all "plans" of Borrower to which such
standards apply; Borrower has not made a "partial withdrawal" or a "complete
withdrawal" from any "multiemployer plan"; and no "reportable event" or
"prohibited transaction" has occurred with respect to any such "plan" (as all
of the quoted terms are defined in ERISA).
SECTION 3.12. Except as otherwise expressly disclosed by Borrower to
Bank in writing on the date of this Agreement: No "hazardous substance" (as
that term is defined in Section 101 of the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended ["CERCLA"]) has
been released, discharged, disposed of, or stored on any of Borrower's owned
or leased real or personal property by Borrower, by any third party, or by
any predecessor in interest or in title to Borrower; Borrower and all of
Borrower's properties are in compliance with all applicable local, state and
federal environmental laws and regulations; no notice has been served on
Borrower by any governmental authority or any individual or entity claiming
violation of any environmental protection law or regulation, or demanding
compliance with any environmental protection law or regulation, or demanding
payment, indemnity, or contribution for any environmental damage or injury to
natural resources; no "hazardous substance" (as defined in CERCLA) is
produced or used in Borrower's business; and no improvement on any real
property owned or leased by Borrower contains any asbestos, including,
without limitation, asbestos insulation on ceilings, piping or structural
members or supports.
SECTION 3.13. Bank shall not be obligated to make any loan under the
Revolving Loan until Borrower shall have furnished Bank, at Borrower's
expense and as the Bank may request from time to time, such evidence as Bank
shall require regarding the truth or continued truth of the foregoing
representations and warranties, including, without limitation, opinions of
Xxxxxxxx's outside legal counsel, opinions and certificates of Borrower's
independent certified public accountants, surveys, appraisals, environmental
audits by qualified environmental engineers selected by Bank, reports of
other independent consultants selected by Bank, and certificates of
Xxxxxxxx's officers. All such evidence must be in form and content
satisfactory to Bank.
ARTICLE IV - AFFIRMATIVE COVENANTS
Borrower covenants and agrees that, so long as it may borrow under this
Agreement or so long as any indebtedness remains outstanding under the
Revolving Loan or under the Note, Borrower shall:
SECTION 4.1. Deliver to Bank (i) within 30 days after each fiscal
quarter an unaudited financial statement including a balance sheet and
statements of income and cash flows, certified by Xxxxxxxx's chief executive
or chief financial officer to be correct and complete, (ii) within 120 days
after the end of each year a financial statement including a balance sheet of
Borrower as of the end of such year and statements of income, cash flows and
changes in equity for such year, setting forth in each case in comparative
form the corresponding figures for the previous year, together with
accompanying schedules and footnotes, certified or compiled (at Bank's
election) by the present independent certified public accountants of Borrower
or by another firm of independent certified public accountants designated by
Borrower which is satisfactory to Bank, such financial statement to be
prepared in accordance with generally accepted accounting principles applied
in a manner consistent with the financial statements previously furnished to
Bank, or if not so prepared, setting forth the manner in which such financial
statement departs from generally accepted accounting principles or from
previous financial statements furnished to Bank by Xxxxxxxx, and (iii) with
reasonable promptness, such other information (including, without limitation,
copies of tax returns and amendments thereto filed by Borrower) as Bank may
request.
SECTION 4.2. Maintain its books, accounts and records in accordance with
generally accepted accounting principles, applied in a manner consistent with
the financial statements previously furnished to the Bank, and shall permit
any person or entity designated in writing by Bank to visit and inspect any
of its properties, books and financial records, and to make copies thereof
and take extracts therefrom, and to discuss Xxxxxxxx's financial affairs with
Xxxxxxxx's financial officers and accountants.
SECTION 4.3. Pay and discharge all taxes, assessments, fees,
withholdings and other governmental charges or levies imposed upon it, or
upon its income and profits, or upon any property belonging to it, prior to
the date on which penalties attach thereto, unless the legality thereof shall
be promptly and actively contested in good faith by appropriate proceedings,
and unless adequate reserves for such liability are maintained by Borrower
pending determination of such contest.
SECTION 4.4. Maintain its existence in good standing in the state of its
organization or incorporation and its qualification and good standing in all
jurisdictions where such qualification is required under applicable law, and
conduct its business in the manner in which it is now conducted subject only
to changes made in the ordinary course of business.
SECTION 4.5. Promptly notify Bank in writing of the occurrence of any
Event of Default or of any pending or threatened litigation claiming damages
in excess of $25,000 or seeking relief that, if granted, would adversely
affect the financial condition or business operations of Borrower.
SECTION 4.6. Maintain and keep in force at all times insurance of the
types and in the amounts customarily carried in lines of business similar to
Borrower's and such other insurance as Bank may require, including, without
limitation, fire, public liability, casualty, property damage, flood damage,
and worker's compensation insurance, which insurance shall be carried with
companies and in amounts satisfactory to Bank. All casualty and property
damage insurance shall name Bank as mortgagee or loss payee, as appropriate,
and shall provide for a minimum often days' written notice to Bank before
cancellation. Borrower shall deliver to Bank from time to time at Bank's
request copies of all such insurance policies and certificates of insurance
and schedules setting forth all insurance then in effect. Borrower hereby
appoints Bank the attorney-in-fact for Borrower for purposes of obtaining,
adjusting, settling, and canceling such insurance and of endorsing in
Borrower's name and giving receipt for checks and drafts issued in payment of
losses and as returned premiums. Borrower hereby assigns all insurance
policies at any time covering property that is Collateral for the Note and
all returned and unearned premiums theron to Bank as additional Collateral
for the Note.
SECTION 4.7. Keep all of its properties in good repair and condition, and
from time to time make neccesary repairs, renewals and replacements thereto
so that Borrower's property shall be fully and efficiently preserved and
maintained.
SECTION 4.8. Perform or take, on request of Bank, such action as may be
necessary or advisable to perfect any lien or security interest in the
Collateral or otherwise to carry out the intent of this Agreement.
SECTION 4.9. Pay or reimburse Bank for any out-of-pocket expenses,
including attorneys' fees, incurred by Bank in preparing or enforcing this
Agreement, the Note, and the Separate Agreements, or in collecting the
Revolving Loan and any other sum due under the Note or this Agreement after
default by Borrower in the payment thereof.
SECTION 4.10. Fund all of its "plans" to which the minimum funding
standards of Section 302 of ERISA apply in accordance with such standards;
furnish Bank, promptly upon Bank's request, copies of all reports or other
statements filed with, or received from, the United States Department of
Labor, the Internal Revenue Service, or the Pension Benefit Guaranty
Corporation with respect to all of Borrower's "plans"; and promptly advise
Bank of the occurrence of any "reportable event" or "prohibited transaction"
with respect to any such "plan" (as all of the quoted terms are defined in
ERISA).
SECTION 4.11. Comply with all applicable present and future local, state
and federal laws, including, without limitation, environmental laws and
regulations; notify Bank immediately if any "hazardous substance" (as defined
in CERCLA) is released, discharged, disposed of, stored, or discovered on any
real or personal property owned or leased by Xxxxxxxx; notify Bank in writing
within three days after Borrower receives notice from any governmental
authority or any individual or entity claiming violation of any environmental
protection law or regulation, or demanding compliance with any environmental
protection law or regulation, or demanding payment, indemnity, or
contribution for any environmental damage or injury to natural resources; and
permit Bank from time to time to observe Borrower's operations and to perform
tests (including soil tests and ground water tests) for "hazardous
substances" on any real or personal property owned or leased by Xxxxxxxx.
SECTION 4.13. Use the proceeds of the Revolving Loan only for
temporary and permanent working capital needs of Xxxxxxx International, Inc.
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SECTION 4.14.
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ARTICLE V - NEGATIVE COVENANTS
Borrower covenants and agrees that, without the prior written consent
of Bank, so long as it may borrow under this Agreement or so long as any
indebtedness remains outstanding under the Revolving Loan or under the Note,
Borrower shall not:
SECTION 5.1. Use any proceeds of the Revolving Loan except for the
purposes stated in SECTION 4.13.
SECTION 5.2. Make any additional investment in fixed assets in any one
fiscal year in excess of a yearly aggregate of $ n/a.
-------------------------------
SECTION 5.3. Create, incur, assume, or suffer to exist any indebtedness
of any description whatsoever not existing as of the date of this Agreement,
except (i) indebtedness incurred under this Agreement, (ii) any trade
indebtedness incurred in the ordinary course of business payable no later
than 60 days of its incurrence, and (iii)
-----------------------------------
------------------------------------------------------------------------------
SECTION 5.4. Merge, consolidate or enter into a partnership or joint
venture with any other person or entity; or sell, lease, transfer or
otherwise dispose of all or any substantial portion of its assets, except
sales of inventory in the ordinary course of business; or change its name; or
change the location of its chief executive office.
SECTION 5.5. Guarantee or become contingently liable for any obligation or
indebtedness of any other person or entity, except that Borrower may endorse
negotiable instruments for collection in the ordinary course of business.
SECTION 5.6. Make any loans, advances or extensions of credit to any
person or entity.
------------------------------------------------------------
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SECTION 5.7. Pay or declare any dividend on any of its capital stock
after the date hereof, provided, however, that if Borrower is an S
Corporation, it may pay dividends not to exceed the amount of income taxes
payable by its shareholders attributable to Borrower's income.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
SECTION 5.8. Grant any lien on or security interest in, or otherwise
encumber, any of its properties or assets including, without limitation, the
Collateral, and, except for liens for taxes not yet due and payable or which
are being actively contested in good faith by appropriate proceedings and for
which adequate reserves are being maintained by Borrower and those liens
disclosed to Bank by Borrower in writing prior to the execution of this
Agreement. Borrower shall not permit to exist any lien, security interest or
other encumbrance on any of its properties or assets.
SECTION 5.9. Take, or fail to take, any act if such act or failure to act
results in the imposition of withdrawal liability under Title IV of ERISA.
SECTION 5.10. Release, discharge, dispose of, store, accept or receive for
storage or disposal, or allow to be stored or disposed of, any "hazardous
substance" (as defined in CERCLA) on or in any real or personal property
owned or leased by Xxxxxxxx, except as otherwise expressly consented to by
Bank in writing; or release, discharge, use, transport, or dispose of any
"hazardous substance" in an unlawful manner.
SECTION 5.11.
(a) Permit its working capital to be at any time less than $ n/a;
----------------
(b) Permit the ratio of its current assets to its current liabilities to
be at any time less than n/a;
--------------------------------------------
(c) Permit its tangible net worth to be at any time
less than $4,250,000.00;
-----------------------------------------------------------
(d) Permit the ratio of its total liabilities to its tangible net worth to
be at any time greater than 1.0 to ?0;
-------------------------------------------------
(e) Permit its Debt Service Coverage to be less than 1.50;
--------------
(f) Change the dates of its fiscal year now employed for financial and
accounting purposes;
(g)
------------------------------------------------------------------------
(h)
------------------------------------------------------------------------
INITIAL
HERE
ARTICLE VI - EVENTS OF DEFAULT AND REMEDIES *See attached Addendum.
SECTION 6.1. Any one or more of the following shall constitute an Event of
Default hereunder by Xxxxxxxx:
(a) Failure to pay when due any payment of principal or interest due on
the Note or any other sum due hereunder; or
(b) Failure to pay when due any payment of principal or interest due on
any other obligation for money borrowed or the deferred purchase price
of goods or services; or
(c) Default under any Separate Agreement or any other document, note,
agreement, mortgage, security agreement, instrument, or understanding
with, held by, or executed in favor of Bank; or
(d) Should any representation or warranty contained herein or made by or
furnished on behalf of Borrower in connection herewith be false or
misleading in any material respect as of the date made; or
(e) Failure to perform or observe any covenant or agreement contained in
Articles IV or V of this Agreement; or
(f) Failure to pay its debts generally as they become due; or
(g) Borrower's or any Guarantor's making or taking any action to make an
assignment for the benefit of creditors, or petitioning or taking any
action to petition any tribunal for the appointment of a custodian,
receiver or any trustee for it or a substantial part of its assets,
or commencing or taking any action to commence any proceeding under
any bankruptcy, reorganization, arrangement, readjustment of debt,
dissolution, liquidation or debtor relief law or statute of any
jurisdiction, whether now or hereafter in effect, including, without
limitation, any chapter of the federal Bankruptcy Code; or, if there
shall have been filed or commenced against Borrower or any Guarantor
any such petition, application or proceeding which is not dismissed
within 30 days or in which an order for relief is entered; or
should Borrower or any such Guarantor by any act or omission indicate
its approval of or acquiescence in any such petition, application or
proceeding or order for relief or the appointment of a custodian,
receiver or any trustee for it or any substantial part of any of its
properties; or should Borrower or any such Guarantor suffer to exist
any such custodianship, receivership or trusteeship; or
(h) Borrower's or any Guarantor's concealing, removing, or permitting to
be concealed or removed, any part of its property, with intent to hinder,
delay or defraud its creditors or any of them, or making or suffering a
transfer of any of its property which may be fraudulent under any
bankruptcy, fraudulent conveyance or similar law; or making any
transfer of its property to or for the benefit of a creditor at a
time when other creditors similarly situated have not been paid, or
suffering or permitting, while insolvent, any creditor to obtain a
lien upon any of its property through legal proceedings or distraint
which is not vacated within 30 days after the date thereof; or
(i) Occurrence of any of the following with respect to Borrower or any
Guarantor: death (if an individual), death of a general partner (if a
partnership), dissolution or cessation of business (if a partnership,
corporation, or other organization), or insolvency.
SECTION 6.2. Upon the occurrence and continuation of an Event of Default,
Bank may (i) terminate all obligations of Bank to Borrower, including,
without limitation, any obligations to lend money under this Agreement or the
Note, (ii) declare immediately due and payable, without presentment, demand,
protest or any other notice of any kind, all of which are expressly waived,
the Note and any other note of Borrower held by Bank, including, without
limitation, principal, accrued interest and costs of collection (including,
without limitation, a reasonable attorney's fee if collected by or through an
attorney who is not a salaried employee of Bank, in bankruptcy or in other
judicial proceedings, which costs Borrower hereby agrees to pay) and (iii)
pursue any remedy available to it under this Agreement, under the Note, under
any other note of Borrower held by Bank, or available at law or in equity.
Page 3 of 5 ________ initials
SECTION 7.1.
As used in this Agreement, the following terms shall have the meanings set
forth below:
(a) Accounting terms used in this Agreement such as "net income",
"working capital", "current assets", "current liabilities", "tangible
net worth", and "total liabilities" shall have the meanings normally
given them by, and shall be calculated, both as to amounts and
classification of items, in accordance with, generally accepted
accounting principles.
(b) "Agreement" means this Revolving Loan Agreement, as amended or
supplemented in writing from time to time.
(c) "Bank" means the banking corporation or association named in the first
sentence of this Agreement and which executes this Agreement below as
"Bank."
(d) "Borrower" means the person or entity named in the first sentence of
this Agreement and who executes this Agreement below as "Borrower." For
purposes of Section 3.11, 4.10, and 5.9, such term also includes any
member of a "controlled group" (as defined in ERISA) of which the
named Borrower is a member.
(e) "CERCLA" is defined in Section 3.12.
(f) "Collateral" is defined in Section 2.1.
(g) "ERISA" is defined in Section 3.11.
(h) "Event of Default" is defined in Section 6.1.
(i) "Debt Service" means a fraction in which the numerator is the sum of
the net income of Borrower (after provision for federal and state
taxes) for the 12-month period preceding the applicable date plus the
interest, lease and rental expenses of Borrower for the period plus
the sum of non-cash expenses or allowances for such period
(including, without limitation, amortization or write-down of
intangible assets, depreciation, depletion, and deferred taxes and
expenses) and the denominator is the sum of the current portion of
the long-term debt of Borrower as of the applicable date plus the
interest, lease and rental expenses for the 12-month period preceding
the applicable date. If Borrower has elected treatment as an
S Corporation under the Internal Revenue Code, however, "Debt Service"
means a fraction in which the numerator is the sum of the net income
of Borrower (after deduction of an amount equal to the federal and
state income taxes, calculated at the marginal rates which would
otherwise have been applicable to Borrower at such time, which
Borrower would have been required to pay if it had not elected
treatment as an S Corporation for federal and state income tax
purposes) for the 12-month period preceding the applicable date plus
the interest, lease and rental expenses of Borrower for the period
plus the sum of noncash expenses or allowances for such period
(including, without limitation, amortization or write-down of
intangible assets, depreciation, depletion, and expenses), and the
denominator is the sum of the current portion of the long-term debt
of Borrower as of the applicable date plus the interest, lease and
rental expenses for the 12-month period preceding the applicable date.
(j) "Guarantor" means any person or entity who endorses the Note or who
now or hereafter guarantees payment or collection of the Revolving Loan
in whole or in part.
(k) "Note" is defined in Section 1.1 and includes any promissory note or
notes given in extension or renewal of, or in substitution for, the
original Note.
(l) "Revolving Loan" is defined in Section 1.1.
(m) "Separate Agreement" is defined in Section 2.1.
ARTICLE VIII - MISCELLANEOUS
SECTION 8.1. No delay or failure on the part of Bank in the exercise of
any right, power or privilege granted under this Agreement or the Note, or
available at law or in equity, shall impair any such right, power or
privilege or be construed as a waiver of any Event of Default or any
acquiescence therein. No single or partial exercise of any such right, power
or privilege shall preclude the further exercise of such right, power or
privilege. No waiver shall be valid against Bank unless made in writing and
signed by Bank, and then only to the extent expressly specified therein.
SECTION 8.2. All notices or consents required or permitted by this
Agreement shall be in writing and shall be deemed to have been given or
made (i) when actually received, if delivered by hand or sent by facsimile
or telegraphic transmission, or (ii) upon the earlier of the actual receipt
or five (5) days after mailing, if sent by certified or registered mail,
postage prepaid, return receipt requested, and addressed as follows:
(a) If to Bank, SouthTrust Bank of North Carolina
-------------------------------------------
P.O. Box 563972
-------------------------------------------
Charlotte, NC 28256-3972
-------------------------------------------
Facsimile Number: 000-000-0000
-------------------------
Attention: Xxxxxxx X. Xxxxxxxxx,
Vice President
------------------------------
(b) If to Borrower,
-------------------------------------------
Xxxxxxx International, Inc.
-------------------------------------------
6849 Fairview Road
-------------------------------------------
Charlotte, NC 28210
-------------------------------------------
Facsimile Number:
-------------------------
Attention: Xxxxxxx X. Xxxxxxx CEO
------------------------------
Either Borrower or Bank, or both, may change its address or facsimile number
for notice purposes by notice to the other party in the manner provided
herein.
SECTION 8.3. This Agreement and the Note shall be governed by and
construed and enforced in accordance with the substantive laws of the United
States and the state in which the principal office of Bank is located,
without regard to that state's rules governing conflicts of law.
SECTION 8.4. All representations and warranties contained in this
Agreement or made or furnished on behalf of Borrower in connection herewith
shall survive the execution and delivery of this Agreement and the
Note, shall be deemed to be made anew each time Borrower requests a loan
under this Agreement, and shall survive until the Revolving Loan and all
interest thereon are paid in full.
SECTION 8.5. This Agreement shall bind and inure to the benefit of
Borrower and Bank, and their respective successors and assigns; provided,
however, Borrower shall have no right to assign its rights or obligations
hereunder to any person or entity.
SECTION 8.6. Time is of the essence in the payment and performance of
every term and covenant of this Agreement and the Note.
SECTION 8.7. This Agreement may be amended or modified, and Borrower may
take any action herein prohibited, or omit to perform any action required to
be performed by it, only if Borrower shall obtain the prior written consent
of Bank to such amendment, modification, action or omission to act, and no
course of dealing between Borrower and Bank shall operate as a waiver of any
right, power or privilege granted under this Agreement, under the Note or the
Separate Agreements, or available at law or in equity. This Agreement, the
Note, and the Separate Agreements contain the entire agreement between
Borrower and Bank regarding the Revolving Loan and the Collateral. No oral
representations or statements shall be binding on Bank, and no agent of Bank
has the authority to vary the terms of this Agreement except in writing on
the face hereof or on a separate page attached hereto.
SECTION 8.8. All rights, powers and privileges granted hereunder shall
be cumulative, and shall not be exclusive of any other rights, powers and
privileges granted by the Note or any other document or agreement, or
available at law or in equity.
SECTION 8.9. Upon the occurrence and during the continuation of an Event
of Default, Borrower recognizes Bank's right, without notice or demand, to
apply any indebtedness due or to become due to Borrower from Bank in
satisfaction of any of the indebtedness, liabilities or obligations or
Borrower under this Agreement, under the Note, or under any other note,
instrument, agreement, document or writing of Borrower held by or executed in
favor of Bank, including, without limitation, the right to set off against
any deposits or cash collateral of Borrower held by Bank. In addition to the
right of setoff, as additional collateral for the Revolving Loan, Borrower
hereby grants to Bank a continuing lien on and security interest in all
deposit accounts of Borrower now or hereafter held by Bank, including all
certificates of deposit now or hereafter issued to Borrower by Bank.
Page 4 of 5 ______ initials
SECTION 8.10. Borrower hereby agrees to indemnify Bank and its
officers, directors, agents and attorneys against, and to hold Bank and all
such other persons harmless from, any claims, demands, liabilities, costs,
damages, and judgments (including, without limitation, liability under
CERCLA, the Federal Resource Conservation and Recovery Act, or other
environmental law or regulation, and costs of defense and attorneys' fees)
resulting from any Representation or Warranty made by Borrower or on
Xxxxxxxx's behalf pursuant to Article III of this Agreement having been false
when made, or resulting from Xxxxxxxx's breach of any of the covenants set
forth in Articles IV or V of this Agreement. This Agreement of indemnity
shall be a continuing agreement and shall survive payment of the Revolving
Loan and the Note and termination of this Agreement.
WITNESS the hands and seals of the parties hereto on or as of the date
first above written.
BANK:
SouthTrust Bank of North Carolina (Corporate and Partnership Borrowers and
other Borrowers executing this note by a
By: /s/ XXXXXXX X. XXXXXXXXX representative sign below):
-----------------------------
Xxxxxxx X. Xxxxxxxxx Xxxxxxx International, Inc.
Title: Vice President -----------------------------------------
----------------------
By: /s/ XXXXXXX X. XXXXXXX AS ITS CEO
--------------------------------------
Xxxxxxx X. Xxxxxxx
-----------------------------------------
(type or print name of representative
of Borrower)
(CORPORATE SEAL)
(Individual Borrowers executing this note
individually and not in a representative
capacity sign below):
X [SEAL]
--------------------------------
---------------------------------Individually and not in
(type or print name of Borrower) a representative
capacity
X [SEAL]
--------------------------------
---------------------------------Individually and not in
(type or print name of Borrower) a representative
capacity
ADDENDUM TO REVOLVING LOAN AGREEMENT BY AND BETWEEN XXXXXXX INTERNATIONAL,
INC AS "BORROWER" AND SOUTHTRUST BANK OF NORTH CAROLINA AS THE "BANK" DATED
SEPTEMBER 19,1996
Article VI - Events of Default and Remedies:
Notwithstanding the foregoing the Bank will agree Borrower has a five day
right to cure period for monetary default (payment default) and a ten day
right to cure period for any non-monetary default. These cure periods begin
on day of notice.
Xxxxxxx International, Inc.
By: /s/ XXXXXXX X. XXXXXXX
--------------------------------------
Xxxxxxx X. Xxxxxxx, CEO
