CHANGE IN TERMS AGREEMENT
Exhibit 10.3
| Principal | Loan Date | Maturity | Loan No. | Call / Coll | Account | Officer | Initials | ||||||||||||||||
| $230,000.00 | 08-02-2006 | 12-02-2006 | 479195 | 025 | |||||||||||||||||||
| References in the shaded area are for Lender’s use only and do not limit the applicability of this document to any particular loan or item. Any item above containing “***’’ has been omitted due to text length limitations. |
|||||||||||||||||||||||
Borrower:
|
Z-AXIS CORPORATION | Lender: | COLORADO BUSINESS BANK | |||
| THE QUADRANT — 0000 XXX XXXXXXX XXX. 000 | XXXXXX | |||||
| XXXXXXXXX XXXXXXX, XX 00000 | 000 00XX XXXXXX | |||||
| XXXXXX, XX 00000 |
| Principal Amount: $230,000.00 | Initial Rate: 9.750% | Date of Agreement: August 2, 2006 |
DESCRIPTION OF
EXISTING INDEBTEDNESS. AN ORIGINAL PROMISSORY NOTE DATED JUNE 2, 2003 IN THE
PRINCIPAL AMOUNT OF $500,000.00, WITH AN ORIGINAL MATURITY DATE OF JULY 2, 2004
AND INCLUDING ANY AND ALL SUBSEQUENT EXTENSIONS AND MODIFICATIONS THEREFROM.
DESCRIPTION OF CHANGE IN TERMS. EXTENSION OF MATURITY DATE
FROM AUGUST 2, 2006 TO DECEMBER 2, 2006. IN ADDITION, THIS
LINE OF CREDIT IS HEREBY CAPPED AT $215,000.00 AS OF
SEPTEMBER 2, 2006; $200,000.00 AS OF OCTOBER 2, 2006; AND
$185,000.00 AS OF NOVEMBER 2, 2006. ALSO, SEE BELOW FOR NEW
INTEREST RATE. ALL OTHER TERMS AND CONDITIONS WILL REMAIN
THE SAME.
PROMISE TO
PAY. Z-AXIS CORPORATION (“Borrower“) promises to
pay to COLORADO BUSINESS BANK (“Lender”), or order, in
lawful money of the United States of America, the principal
amount of Two Hundred Thirty Thousand & 00/100 Dollars
($230,000.00) or so much as may be outstanding, together
with interest on the unpaid outstanding principal balance
of each advance. Interest shall be calculated from the date
of each advance until repayment of each advance.
PAYMENT. Borrower will pay this loan in one payment of all
outstanding principal plus all accrued unpaid interest on December 2, 2006. In
addition, Borrower will pay regular monthly payments of all accrued unpaid
interest due as of each payment date, beginning September 2, 2006, with all
subsequent interest payments to be due on the same day of each month after
that. Unless otherwise agreed or required by applicable law, payments will be
applied first to any accrued unpaid interest; then to principal: then to any
late charges; and then to any unpaid collection costs. Interest on this loan is
computed on a 365/360 simple interest basis; that is, by applying the ratio of
the annual interest rate over a year of 360 days, multiplied by the outstanding
principal balance, multiplied by the actual number of days the principal balance
is outstanding. Borrower will pay Lender at Lender’s address shown above or at
such other place as Lender may designate in writing.
VARIABLE INTEREST RATE. The interest rate on this loan is subject to change
from time to time based on changes in an index which is the COLORADO BUSINESS
BANK PRIME RATE (the “Index”). Lender will tell Borrower
the current Index rate
upon Borrower’s request. The interest rate change will not occur more often
than each DAY. Borrower understands that Lender may make loans based on other
rates as well. The index currently is 8.250% per annum. The interest rate to be
applied to the unpaid principal balance during this loan will be at a rate of
1.500 percentage points over the Index, resulting in an initial rate of 9.750%
per annum. NOTICE: Under no circumstances will the interest rate on this loan
be more than the maximum rate allowed by applicable law.
PREPAYMENT. Borrower agrees that all loan fees and other prepaid finance
charges are earned fully as of the date of the loan and will not be subject to
refund upon early payment (whether voluntary or as a result of default), except
as otherwise required by law. Except for the foregoing, Borrower may pay
without penalty all or a portion of the amount owed earlier than it is due.
Early payments will not, unless agreed to by Lender in writing, relieve
Borrower of Borrower’s obligation to continue to make payments of accrued
unpaid interest. Rather, early payments will reduce the principal balance due.
Borrower agrees not to send Lender payments marked “paid in full”, “without
recourse”, or similar language. If Borrower sends such a payment, Lender may
accept it without losing any of Lender’s rights under this Agreement, and
Borrower will remain obligated to pay any further amount owed to Lender. All
written communications concerning disputed amounts, including any check or
other payment instrument that indicates that the payment constitutes “payment
in full” of the amount owed or that is tendered with other conditions or
limitations or as full satisfaction of a disputed amount must be mailed or
delivered to: COLORADO BUSINESS BANK, ATTN: LOAN OPERATIONS, X.X. XXX 0000
XXXXXX, XX 00000.
LATE CHARGE. If a payment is 11 days or more late, Borrower
will be charged 5.000% of the unpaid portion of the regularly scheduled
payment.
INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final
maturity, the interest rate on this loan shall be increased by adding a 5.000
percentage point margin (“Default Rate Margin”). The Default Rate Margin shall
also apply to each succeeding interest rate change that would have applied had
there been no default. However, in no event will the interest rate exceed the
maximum interest rate limitations under applicable law.
DEFAULT. Each of the
following shall constitute an Event of Default under this Agreement:
Payment Default. Borrower fails to make any payment when due under the
Indebtedness.
Other Defaults. Borrower fails to comply with or to perform
any other term, obligation, covenant or condition contained in this
Agreement or in any of the Related Documents or to comply with or to perform
any term, obligation, covenant or condition contained in any other agreement
between Lender and Borrower.
False Statements. Any warranty, representation
or statement made or furnished to Lender by Borrower or on Borrower’s behalf
under this Agreement or the Related Documents is false or misleading in any
material respect, either now or at the time made or furnished or becomes
false or misleading at any time thereafter.
Insolvency. The dissolution or
termination of Borrower’s existence as a going business, the insolvency of
Borrower, the appointment of a receiver for any part of Borrower’s property,
any assignment for the benefit of creditors, any type of creditor workout,
or the commencement of any proceeding under any bankruptcy or insolvency
laws by or against Borrower.
Creditor or Forfeiture Proceedings.
Commencement of foreclosure or forfeiture proceedings, whether by judicial
proceeding, self-help, repossession or any other method, by any creditor of
Borrower or by any governmental agency against any collateral securing the
Indebtedness. This includes a garnishment of any of Borrower’s accounts,
including deposit accounts, with Lender. However, this Event of Default
shall not apply if there is a good faith dispute by Borrower as to the
validity or reasonableness of the claim which is the basis of the creditor
or forfeiture proceeding and if Borrower gives Lender written notice of the
creditor or forfeiture proceeding and deposits with Lender monies or a
surety bond for the creditor or forfeiture proceeding, in an amount
determined by Lender, in its sole discretion, as being an adequate reserve
or bond for the dispute.
Events Affecting Guarantor. Any of the preceding events occurs with respect
to any Guarantor of any of the Indebtedness or any Guarantor dies or becomes
incompetent, or revokes or disputes the validity of, or liability under, any
Guaranty of the Indebtedness evidenced by this Note.
Change
In Ownership. Any change in ownership of
twenty-five percent (25%) or more of the common stock of
Borrower.
Adverse Change. A material adverse change occurs in
Borrower’s financial condition, or Lender believes the
prospect of payment or performance of the Indebtedness
is impaired.
Insecurity. Lender in good faith believes itself
insecure.
LENDER’S
RIGHTS. Upon default, Lender may declare the entire unpaid principal
balance under this Agreement and all accrued unpaid interest immediately due,
and then Borrower will pay that amount.
ATTORNEYS’ FEES; EXPENSES. Lender may hire or pay someone else to help collect
this Agreement if Borrower does not pay. Borrower will pay Lender the
reasonable costs of such collection. This includes, subject to any limits under
applicable law, Lender’s attorneys’ fees and Lender’s legal expenses, whether
or not there is a lawsuit, including without limitation attorneys’ fees and
legal expenses for bankruptcy proceedings (including efforts to modify or
vacate any automatic stay or injunction), and appeals. If not prohibited by
applicable law, Borrower also will pay any court costs, in addition to all
other sums provided by law.
JURY WAIVER. Lender and Borrower hereby waive the right to any jury trial in
any action, proceeding, or counterclaim brought by either Lender or Borrower
against the other.
| CHANGE IN TERMS AGREEMENT | ||||
| Loan No: 479195 | (Continued) | Page 2 | ||
GOVERNING
LAW. This Agreement will be governed by federal
law applicable to Lender and, to the extent not preempted
by federal law, the laws of the State of Colorado without
regard to its conflicts of law provisions. This Agreement
has been accepted by Lender in the State of Colorado.
DISHONORED
ITEM FEE. Borrower will pay a fee to Lender of $32.00 if Borrower
makes a payment on Borrower’s loan and the check or preauthorized charge with
which Borrower pays is later dishonored.
RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a
right of setoff in all Borrower’s accounts with Lender (whether checking,
savings, or some other account). This includes all accounts Borrower holds
jointly with someone else and all accounts Borrower may open in the future.
However, this does not include any XXX or Xxxxx accounts, or any trust accounts
for which setoff would be prohibited by law. Borrower authorizes Lender, to the
extent permitted by applicable law, to charge or setoff all sums owing on the
debt against any and all such accounts.
LINE OF CREDIT. This Agreement evidences a revolving line of credit. Advances
under this Agreement, as well as directions for payment from Borrower’s
accounts, may be requested orally or in writing by Borrower or by an authorized
person. Lender may, but need not, require that all oral requests be confirmed in
writing. Borrower agrees to be liable for all sums either: (A) advanced in
accordance with the instructions of an authorized person or (B) credited to any
of Borrower’s accounts with Lender. The unpaid principal balance owing on this
Agreement at any time may be evidenced by endorsements on this Agreement or by
Lender’s internal records, including daily computer print-outs. Lender will have
no obligation to advance funds under this Agreement if: (A) Borrower or any
guarantor is in default under the terms of this Agreement or any agreement that
Borrower or any guarantor has with Lender, including any agreement made in
connection with the signing of this Agreement; (B) Borrower or any guarantor
ceases doing business or is insolvent; (C) any guarantor seeks, claims or
otherwise attempts to limit, modify or revoke such guarantor’s guarantee of this
Agreement or any other loan with Lender; (D) Borrower has applied funds provided
pursuant to this Agreement for purposes other than those authorized by Lender;
or (E) Lender in good faith believes itself insecure.
CONTINUING VALIDITY.
Except as expressly changed by this Agreement, the terms of the original
obligation or obligations, including all agreements evidenced or securing the
obligation(s), remain unchanged and in full force and effect. Consent by Lender
to this Agreement does not waive Lender’s right to strict performance of the
obligation(s) as changed, nor obligate Lender to make any future change in
terms. Nothing in this Agreement will constitute a satisfaction of the
obligation(s). It is the intention of Lender to retain as liable parties all
makers and endorsers of the original obligation(s), including accommodation
parties, unless a party is expressly released by Lender in writing. Any maker or
endorser, including accommodation makers, will not be released by virtue of this
Agreement. If any person who signed the original obligation does not sign this
Agreement below, then all persons signing below acknowledge that this Agreement
is given conditionally, based on the representation to Lender that the
non-signing party consents to the changes and provisions of this Agreement or
otherwise will not be released by it. This waiver applies not only to any
initial extension, modification or release, but also to all such subsequent
actions.
SUCCESSORS AND ASSIGNS. Subject to any limitations stated in this Agreement on
transfer of Borrower’s interest, this Agreement shall be binding upon and inure
to the benefit of the parties, their successors and assigns. If ownership of
the Collateral becomes vested in a person other than Borrower, Lender, without
notice to Borrower, may deal with Borrower’s successors with reference to this
Agreement and the Indebtedness by way of forbearance or extension without
releasing Borrower from the obligations of this Agreement or liability under
the Indebtedness.
NOTIFY US OF INACCURATE INFORMATION WE REPORT TO CONSUMER REPORTING AGENCIES.
Please notify us if we report any inaccurate information about your account(s)
to a consumer reporting agency. Your written notice describing the specific
inaccuracy(ies) should be sent to us at the following address: COLORADO
BUSINESS BANK ATTN: LOAN OPERATIONS 000 00XX XXXXXX XXXXXX, XX 00000.
MISCELLANEOUS PROVISIONS. If any part of this Agreement cannot be enforced,
this fact will not affect the rest of the Agreement. Lender may delay or forgo
enforcing any of its rights or remedies under this Agreement without losing
them. Borrower and any other person who signs, guarantees or endorses this
Agreement, to the extent allowed by law, waive presentment, demand for payment,
and notice of dishonor. Upon any change in the terms of this Agreement, and
unless otherwise expressly stated in writing, no party who signs this
Agreement, whether as maker, guarantor, accommodation maker or endorser, shall
be released from liability. All such parties agree that Lender may renew or
extend (repeatedly and for any length of time) this loan or release any party
or guarantor or collateral; or impair, fail to realize upon or perfect Lender’s
security interest in the collateral; and take any other action deemed necessary
by Lender without the consent of or notice to anyone. All such parties also
agree that Lender may modify this loan without the consent of or notice to
anyone other than the party with whom the modification is made. The
obligations under this Agreement are joint and several.
PRIOR TO SIGNING THIS
AGREEMENT, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS AGREEMENT,
INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO THE TERMS
OF THE AGREEMENT.
| BORROWER: | ||||||
| Z-AXIS CORPORATION | ||||||
By:
|
/s/ XXXX XXXXXXXX | By: | /s/ XXXXXXXXX X. XXXXX | |||
| XXXX XXXXXXXX, CEO/CFO of Z-AXIS | XXXXXXXXX X. XXXXX, President of Z-AXIS | |||||
| CORPORATION | CORPORATION | |||||
DISBURSEMENT REQUEST AND AUTHORIZATION
| Principal | Loan Date | Maturity | Loan No. | Call / Coll | Account | Officer | Initials | ||||||||||||||||
| $230,000.00 | 08-02-2006 | 12-02-2006 | 479195 | 025 | |||||||||||||||||||
| References in the shaded area are for Lender’s use only and do not limit the applicability of this document to any particular loan or item. Any item above containing “***’’ has been omitted due to text length limitations. |
|||||||||||||||||||||||
Borrower:
|
Z-AXIS CORPORATION | Lender: | COLORADO BUSINESS BANK | |||
| THE QUADRANT — 0000 XXX XXXXXXX XXX. 000 | XXXXXX | |||||
| XXXXXXXXX XXXXXXX XX 00000 | 000 00XX XXXXXX | |||||
| XXXXXX, XX 00000 |
LOAN TYPE. This is a Variable Rate Nondisclosable
Revolving Line of Credit
Loan to a Corporation for $230,000.00 due on December 2, 2006. The reference
rate (COLORADO BUSINESS BANK PRIME RATE, currently 8.250%) is added to the
margin of 1.500%, resulting in an initial rate of 9.750.
PRIMARY PURPOSE OF LOAN. The primary purpose of this loan
is for:
o Personal, Family, or Household Purposes or Personal
Investment.
x Business (Including Real Estate Investment).
SPECIFIC PURPOSE. The specific purpose of this loan is:
CHANGE IN TERMS.
DISBURSEMENT INSTRUCTIONS. Borrower understands that no
loan proceeds will be disbursed until all of Lender’s
conditions for making the loan have been satisfied. Please
disburse the loan proceeds of $230,000.00 as follows:
Undisbursed Funds: |
$ | 118.20 | ||
Other Disbursements: |
$ | 229,881.80 | ||
$229,881.80 EXTEND & MODIFY LOAN #479195 (CURRENT
BALANCE) |
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Note Principal: |
$ | 230,000.00 | ||
CHARGES PAID IN CASH. Borrower has paid or will pay in cash as agreed
the following charges:
Prepaid Finance Charges Paid in Cash: |
$ | 1,000.00 | ||
$1,000.00 LOAN FEE |
||||
Other Charges Paid in Cash: |
$ | 1,949.21 | ||
$1,949.21 INTEREST DUE TO 09-02-06 |
||||
Total Charges Paid In Cash: |
$ | 2,949.21 | ||
AUTHORIZATION. BORROWER AUTHORIZES LENDER TO DISBURSE THE
LOAN PROCEEDS BY WIRE TRANSFER WHERE APPROPRIATE AND THIS
AUTHORIZATION SHALL CONSTITUTE A PAYMENT ORDER FOR SUCH
TRANSFERS.
FINANCIAL CONDITION. BY SIGNING THlS AUTHORIZATION, BORROWER REPRESENTS AND
WARRANTS TO LENDER THAT THE INFORMATION PROVIDED ABOVE IS TRUE AND CORRECT AND
THAT THERE HAS BEEN NO MATERIAL ADVERSE CHANGE IN BORROWER’S FINANCIAL
CONDITION AS DISCLOSED IN BORROWER’S MOST RECENT FINANCIAL STATEMENT TO LENDER.
THlS AUTHORIZATION IS DATED AUGUST 2, 2006.
| BORROWER: | ||||||
| Z-AXIS CORPORATION | ||||||
By:
|
/s/ XXXX XXXXXXXX | By: | /s/ XXXXXXXXX X. XXXXX | |||
| XXXX XXXXXXXX, CEO/CFO of Z-AXIS | XXXXXXXXX X. XXXXX, President of Z-AXIS | |||||
| CORPORATION | CORPORATION | |||||
COMMERCIAL GUARANTY
| Principal | Loan Date | Maturity | Loan No | Call/Coll | Account | Officer 025 |
Initials | |||||||||
| References in the
shaded area are for Lender’s use only and do not limit the
applicability of this document to any particular loan or item. Any item above containing “***” has been omitted due to text length limitations. |
||||||||||||||||
| Borrower: | Z-AXIS CORPORATION | Lender: | COLORADO BUSINESS BANK |
| THE QUADRANT - 0000 XXX XXXXXXX XXX. 000 | XXXXXX | ||
| XXXXXXXXX XXXXXXX, XX 00000 | 000 00XX XXXXXX | ||
| XXXXXX, XX 00000 | |||
| Guarantor: | XXXX XXXXXXXX | ||
| 000 XXXX XXXXX XX. | |||
| XXXXXX XXXX, XX 00000 | |||
CONTINUING GUARANTEE OF PAYMENT AND PERFORMANCE. For good and valuable
consideration, Guarantor absolutely and unconditionally guarantees full and
punctual payment and satisfaction of the Indebtedness of Borrower to Lender, and
the performance and discharge of all Borrower’s obligations under the Note and
the Related Documents. This is a guaranty of payment and performance and not of
collection, so Lender can enforce this Guaranty against Guarantor even when
Lender has not exhausted Lender’s remedies against anyone else obligated to pay
the Indebtedness or against any collateral securing the Indebtedness, this
Guaranty or any other guaranty of the Indebtedness. Guarantor will make any
payments to Lender or its order, on demand, in legal tender of the United States
of America, in same-day funds, without set-off or deduction or counterclaim, and
will otherwise perform Borrower’s obligations under the Note and Related
Documents. Under this Guaranty, Guarantor’s liability is unlimited and
Guarantor’s obligations are continuing.
INDEBTEDNESS.
The word “Indebtedness” as used in this Guaranty means all of the
principal amount outstanding from time to time and at any one or more times,
accrued unpaid interest thereon and all collection costs and legal expenses
related thereto permitted by law, attorneys’ fees, arising from any and all
debts, liabilities and obligations of every nature or form, now existing or
hereafter arising or acquired, that Borrower individually or collectively or
interchangeably with others, owes or will owe Lender. “Indebtedness” includes,
without limitation, loans, advances, debts, overdraft indebtedness, credit card
indebtedness, lease obligations, liabilities and obligations under any interest
rate protection agreements or foreign currency exchange agreements or commodity
price protection agreements, other obligations, and liabilities of Borrower, and
any present or future judgments against Borrower, future advances, loans or
transactions that renew, extend, modify, refinance, consolidate or substitute
these debts, liabilities and obligations whether: voluntarily or involuntarily
incurred; due or to become due by their terms or acceleration; absolute or
contingent; liquidated or unliquidated; determined or undetermined; direct or
indirect; primary or secondary in nature or arising from a guaranty or surety;
secured or unsecured; joint or several or joint and several; evidenced by a
negotiable or non-negotiable instrument or writing; originated by Lender or
another or others; barred or unenforceable against Borrower for any reason
whatsoever; for any transactions that may be voidable for any reason (such as
infancy, insanity, ultra xxxxx or otherwise); and originated then reduced or
extinguished and then afterwards increased or reinstated.
If Lender
presently holds one or more guaranties, or hereafter receives
additional guaranties from Guarantor, Lender’s rights under all
guaranties shall be cumulative. This Guaranty shall not (unless
specifically provided below to the contrary) affect or invalidate any
such other guaranties. Guarantor’s liability will be
Guarantor’s aggregate liability under the terms of this Guaranty
and any such other unterminated guaranties.
CONTINUING GUARANTY. THIS
IS A “CONTINUING GUARANTY” UNDER WHICH GUARANTOR AGREES TO GUARANTEE THE FULL
AND PUNCTUAL PAYMENT, PERFORMANCE AND SATISFACTION OF THE INDEBTEDNESS OF
BORROWER TO LENDER, NOW EXISTING OR HEREAFTER ARISING OR ACQUIRED, ON AN OPEN
AND CONTINUING BASIS. ACCORDINGLY, ANY PAYMENTS MADE ON THE INDEBTEDNESS WILL
NOT DISCHARGE OR DIMINISH GUARANTOR’S OBLIGATIONS AND LIABILITY UNDER THIS
GUARANTY FOR ANY REMAINING AND SUCCEEDING INDEBTEDNESS EVEN WHEN ALL OR PART OF
THE OUTSTANDING INDEBTEDNESS MAY BE A ZERO BALANCE FROM TIME TO TIME.
DURATION OF GUARANTY. This Guaranty will take effect when received by Lender
without the necessity of any acceptance by Lender, or any notice to Guarantor
or to Borrower, and will continue in full force until all the Indebtedness
incurred or contracted before receipt by Lender of any notice of revocation
shall have been fully and finally paid and satisfied and all of Guarantor’s
other obligations under this Guaranty shall have been performed in full. If
Guarantor elects to revoke this Guaranty, Guarantor may only do so in writing.
Guarantor’s written notice of revocation must be mailed to Lender, by certified
mail, at Lender’s address listed above or such other place as Lender may
designate in writing. Written revocation of this Guaranty will apply only to
advances or new Indebtedness created after actual receipt by Lender of
Guarantor’s written revocation. For this purpose and without limitation, the
term “new Indebtedness” does not include the Indebtedness which at the time of
notice of revocation is contingent, unliquidated, undetermined or not due and
which later becomes absolute, liquidated, determined or due. This Guaranty will
continue to bind Guarantor for all the Indebtedness incurred by Borrower or
committed by Lender prior to receipt of Guarantor’s written notice of
revocation, including any extensions, renewals, substitutions or modifications
of the Indebtedness. All renewals, extensions, substitutions, and modifications
of the Indebtedness granted after Guarantor’s revocation, are contemplated
under this Guaranty and, specifically will not be considered to be new
Indebtedness. This Guaranty shall bind Guarantor’s estate as to the
Indebtedness created both before and after Guarantor’s death or incapacity,
regardless of Lender’s actual notice of Guarantor’s death. Subject to the
foregoing, Guarantor’s executor or administrator or other legal representative
may terminate this Guaranty in the same manner in which Guarantor might have
terminated it and with the same effect. Release of any other guarantor or
termination of any other guaranty of the Indebtedness shall not affect the
liability of Guarantor under this Guaranty. A revocation Lender receives from
any one or more Guarantors shall not affect the liability of any remaining
Guarantors under this Guaranty. It is anticipated that fluctuations may occur
in the aggregate amount of the Indebtedness covered by this Guaranty, and
Guarantor specifically acknowledges and agrees that reductions in the amount of
the Indebtedness, even to zero dollars ($0.00), prior to Guarantor’s written
revocation of this Guaranty shall not constitute a termination of this
Guaranty. This Guaranty is binding upon Guarantor and Guarantor’s heirs,
successors and assigns so long as any of the Indebtedness remains unpaid and
even though the Indebtedness may from time to time be zero dollars
($0.00).
GUARANTOR’S AUTHORIZATION TO LENDER. Guarantor authorizes Lender, either before
or after any revocation hereof, without notice or demand and without lessening
Guarantor’s liability under this Guaranty, from time to time: (A) prior to
revocation as set forth above, to make one or more additional secured or
unsecured loans to Borrower, to lease equipment or other goods to Borrower, or
otherwise to extend additional credit to Borrower; (B) to alter, compromise,
renew, extend, accelerate, or otherwise change one or more times the
time for payment or other terms of the Indebtedness or any part of
the Indebtedness,
including increases and decreases of the rate of interest on the Indebtedness;
extensions may be repeated and may be for longer than the original loan term;
(C) to take and hold security for the payment of this Guaranty or the
Indebtedness, and exchange, enforce, waive, subordinate, fail or decide not to
perfect, and release any such security, with or without the substitution of new
collateral; (D) to release, substitute, agree not to xxx, or deal with any one
or more of Borrower’s sureties, endorsers, or other guarantors on any terms or
in any manner Lender may choose; (E) to determine how, when and what
application of payments and credits shall be made on the
Indebtedness; (F) to
apply such security and direct the order or manner of sale thereof, including
without limitation, any nonjudicial sale permitted by the terms of the
controlling security agreement or deed of trust, as Lender in its discretion
may determine: (G) to sell, transfer, assign or grant participations in all or
any part of the Indebtedness; and (H) to assign or transfer this Guaranty in
whole or in part.
GUARANTOR’S REPRESENTATIONS AND WARRANTIES. Guarantor represents and warrants
to Lender that (A) no representations or agreements of any kind have been made
to Guarantor which would limit or qualify in any way the terms of this
Guaranty; (B) this Guaranty is executed at Borrower’s request and not at the
request of Lender; (C) Guarantor has full power, right and authority to enter
into this Guaranty; (D) the provisions of this Guaranty do not conflict with or
result in a default under any agreement or other instrument binding upon
Guarantor and do not result in a violation of any law, regulation, court decree
or order applicable to Guarantor; (E) Guarantor has not and will not, without
the prior written consent of Lender, sell, lease, assign, encumber,
hypothecate, transfer, or otherwise dispose of all or substantially all of
Guarantor’s assets, or any interest therein; (F) upon Lender’s request,
Guarantor will provide to Lender financial and credit information in form
acceptable to Lender, and all such financial information which currently has
been, and all future financial information which will be provided to Lender is
and will be true and correct in all material respects and fairly present
Guarantor’s financial condition as of the dates the financial information is
provided; (G) no material adverse change has occurred in Guarantor’s financial
condition since the date of the most recent financial statements provided to
Lender and no event has occurred which may materially adversely affect
Guarantor’s financial condition; (H) no litigation, claim,
investigation,
administrative proceeding or similar action (including those for unpaid taxes)
against Guarantor is pending or threatened; (I) Lender has made no
representation to Guarantor as to the creditworthiness of Borrower;
and (J)
Guarantor has established adequate means of obtaining from Borrower on a
continuing basis information regarding Borrower’s financial condition.
Guarantor agrees to keep adequately informed from such means of any facts,
events, or circumstances which might in any way affect Guarantor’s risks under
this Guaranty, and Guarantor further agrees that, absent a request for
information. Lender shall have no obligation to disclose to Guarantor any
| COMMERCIAL GUARANTY | ||||
| Loan No: 479195 | (Continued) | Page 2 |
information or documents acquired by Lender in the course
of its relationship with Borrower.
GUARANTOR’S WAIVERS. Except as prohibited by applicable law, Guarantor waives
any right to require Lender [A) to continue lending money or to extend other
credit to Borrower; (B) to make any presentment, protest, demand, or notice of
any kind, including notice of any nonpayment of the Indebtedness or of any
nonpayment related to any collateral, or notice of any action or nonaction on
the part of Borrower, Lender, any surety, endorser, or other guarantor in
connection with the Indebtedness or in connection with the creation of new or
additional loans or obligations; (C) to resort for payment or to proceed
directly or at once against any person, including Borrower or any other
guarantor; (D) to proceed directly against or exhaust any collateral held by
Lender from Borrower, any other guarantor, or any other person; (E) to give
notice of the terms, time, and place of any public or private sale of personal
property security held by Lender from Borrower or to comply with any other
applicable provisions of the Uniform Commercial Code; (F) to pursue any other
remedy within Lender’s power; or (G) to commit any act or omission of any kind,
or at any time, with respect to any matter whatsoever.
Guarantor also waives any and all rights or defenses based on suretyship or
impairment of collateral including, but not limited to, any rights or defenses
arising by reason of (A) any “one action” or “anti-deficiency” law or any other
law which may prevent Lender from bringing any action, including a claim for
deficiency, against Guarantor, before or after Lender’s commencement or
completion of any foreclosure action, either judicially or by exercise of a
power of sale; (B) any election of remedies by Lender which destroys or
otherwise adversely affects Guarantor’s subrogation rights or Guarantor’s rights
to proceed against Borrower for reimbursement, including without limitation, any
loss of rights Guarantor may suffer by reason of any law limiting, qualifying,
or discharging the Indebtedness; (C) any disability or other defense of
Borrower, of any other guarantor, or of any other person, or by reason of the
cessation of Borrower’s liability from any cause whatsoever, other than payment
in full in legal tender, of the Indebtedness; (D) any right to claim discharge
of the Indebtedness on the basis of unjustified impairment of any collateral far
the Indebtedness; (E) any statute of limitations, if at any time any action or
suit brought by Lender against Guarantor is commenced, there is outstanding
Indebtedness which is not barred by any applicable statute of
limitations; or
(F) any defenses given to guarantors at law or in equity other than
actual
payment and performance of the Indebtedness. If payment is made by
Borrower,
whether voluntarily or otherwise, or by any third party, on the Indebtedness and
thereafter Lender is forced to remit the amount of that payment to Borrower’s
trustee in bankruptcy or to any similar person under any federal or state
bankruptcy law or law for the relief of debtors, the Indebtedness shall be
considered unpaid for the purpose of the enforcement of this Guaranty.
Guarantor further waives and agrees not to assert or claim at any time any
deductions to the amount guaranteed under this Guaranty for any claim of
setoff, counterclaim, counter demand, recoupment or similar right, whether such
claim, demand or right may be asserted by the Borrower, the Guarantor, or
both.
GUARANTOR’S UNDERSTANDING WITH RESPECT TO WAIVERS. Guarantor warrants and
agrees that each of the waivers set forth above is made with Guarantor’s full
knowledge of its significance and consequences and that, under the
circumstances, the waivers are reasonable and not contrary to public policy or
law. If any such waiver is determined to be contrary to any applicable law or
public policy, such waiver shall be effective only to the extent permitted by
law or public policy.
RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a
right of setoff in all Guarantor’s accounts with Lender (whether checking,
savings, or some other account). This includes all accounts Guarantor holds
jointly with someone else and all accounts Guarantor may open in the future.
However, this does not include any XXX or Xxxxx accounts, or any trust accounts
for which setoff would be prohibited by law. Guarantor authorizes Lender, to
the extent permitted by applicable law, to hold these funds if there is a
default, and Lender may apply the funds in these accounts to pay what Guarantor
owes under the terms of this Guaranty.
SUBORDINATION OF BORROWER’S DEBTS TO GUARANTOR. Guarantor agrees that the
Indebtedness, whether now existing or hereafter created, shall be superior to
any claim that Guarantor may now have or hereafter acquire against Borrower,
whether or not Borrower becomes insolvent. Guarantor hereby expressly
subordinates any claim Guarantor may have against Borrower, upon any account
whatsoever, to any claim that Lender may now or hereafter have against
Borrower. In the event of insolvency and consequent liquidation of the assets
of Borrower, through bankruptcy, by an assignment for the benefit of creditors,
by voluntary liquidation, or otherwise, the assets of Borrower applicable to
the payment of the claims of both Lender and Guarantor shall be paid to Lender
and shall be first applied by Lender to the Indebtedness. Guarantor does hereby
assign to Lender all claims which it may have or acquire against Borrower or
against any assignee or trustee in bankruptcy of Borrower; provided however,
that such assignment shall be effective only for the purpose of assuring to
Lender full payment in legal tender of the Indebtedness. If Lender so requests,
any notes or credit agreements now or hereafter evidencing any debts or
obligations of Borrower to Guarantor shall be marked with a legend that the
same are subject to this Guaranty and shall be delivered to Lender. Guarantor
agrees, and Lender is hereby authorized, in the name of Guarantor, from time to
time to file financing statements and continuation statements and to execute
documents and to take such other actions as Lender deems necessary or
appropriate to perfect, preserve and enforce its rights under this Guaranty.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Guaranty.
Amendments. This Guaranty, together with any Related Documents, constitutes
the entire understanding and agreement of the parties as to the matters set
forth in this Guaranty. No alteration of or amendment to this Guaranty shall
be effective unless given in writing and signed by the party or parties
sought to be charged or bound by the alteration or amendment.
Attorneys’
Fees; Expenses. Guarantor agrees to pay upon demand all of
Lender’s reasonable costs and expenses, including Lender’s attorneys’ fees
and Lender’s legal expenses, incurred in connection with the enforcement of
this Guaranty. Lender may hire or pay someone else to help enforce this
Guaranty, and Guarantor shall pay the reasonable costs and expenses of such
enforcement. Costs and expenses include Lender’s attorneys’ fees and legal
expenses whether or not there is a lawsuit, including attorneys’ fees and
legal expenses for bankruptcy proceedings (including efforts to modify or
vacate any automatic stay or injunction), appeals, and any anticipated
post-judgment collection services. Guarantor also shall pay all court costs
and such additional fees as may be directed by the court.
Caption Headings. Caption headings in this Guaranty are for convenience
purposes only and are not to be used to interpret or define the provisions
of this Guaranty.
Governing
Law. This Guaranty will be governed by federal
law applicable to Lender and, to the extent not preempted by federal law,
the laws of the State of Colorado without regard to its conflicts of law
provisions. This Guaranty has been accepted by Lender in the State of
Colorado.
Integration.
Guarantor further agrees that Guarantor has read and fully
understands the terms of this Guaranty; Guarantor has had the opportunity to
be advised by Guarantor’s attorney with respect to this Guaranty; the
Guaranty fully reflects Guarantor’s intentions and parol evidence is not
required to interpret the terms of this Guaranty. Guarantor hereby
indemnifies and holds Lender harmless from all losses, claims, damages, and
costs (including Lender’s attorneys’ fees) suffered or incurred by Lender as
a result of any breach by Guarantor of the warranties, representations and
agreements of this paragraph.
Interpretation. In all cases where there is more than one Borrower or
Guarantor, then all words used in this Guaranty in the singular shall be
deemed to have been used in the plural where the context and construction so
require; and where there is more than one Borrower named in this Guaranty or
when this Guaranty is executed by more than one Guarantor, the words
“Borrower” and “Guarantor” respectively shall mean all and any one or more
of them. The words “Guarantor,” “Borrower,” and “Lender” include the heirs,
successors, assigns, and transferees of each of them. If a court finds that
any provision of this Guaranty is not valid or should not be enforced, that
fact by itself will not mean that the rest of this Guaranty will not be
valid or enforced. Therefore, a court will enforce the rest of the
provisions of this Guaranty even if a provision of this Guaranty may be
found to be invalid or unenforceable. If any one or more of Borrower or
Guarantor are corporations, partnerships, limited liability companies, or
similar entities, it is not necessary for Lender to inquire into the powers
of Borrower or Guarantor or of the officers, directors, partners, managers,
or other agents acting or purporting to act on their behalf, and any
indebtedness made or created in reliance upon the professed exercise of such
powers shall be guaranteed under this Guaranty.
Notices. Any notice required to be given under this Guaranty shall be given
in writing, and, except for revocation notices by Guarantor, shall be
effective when actually delivered, when actually received by telefacsimile
(unless otherwise required by law), when deposited with a nationally
recognized overnight courier, or, if mailed, when deposited in the United
States mail, as first class, certified or registered mail postage prepaid,
directed to the addresses shown near the beginning of this Guaranty. All
revocation notices by Guarantor shall be in writing and shall be effective
upon delivery to Lender as provided in the section of this Guaranty entitled
“DURATION OF GUARANTY.” Any party may change its address for notices under
this Guaranty by giving formal written notice to the other parties,
specifying that the purpose of the notice is to change the party’s address.
For notice purposes, Guarantor agrees to keep Lender informed at all times
of Guarantor’s current address. Unless otherwise provided or required by
law, if there is more than one Guarantor, any notice given by Lender to any
Guarantor is deemed to be notice given to all Guarantors.
No Waiver by Lender. Lender shall not be deemed to have waived any rights
under this Guaranty unless such waiver is given in writing and signed by
Lender. No delay or omission on the part of Lender in exercising any right
shall operate as a waiver of such right or any other right. A waiver by
Lender of a provision of this Guaranty shall not prejudice or constitute a
waiver of Lender’s right otherwise to demand strict compliance with that
provision or any other provision of this Guaranty. No prior waiver by
Lender, nor any course of dealing between Lender and Guarantor, shall
constitute a waiver of any of Lender’s rights or of any of Guarantor’s
obligations as to any future transactions. Whenever the consent of
Lender is
required under this Guaranty, the granting of such consent by Lender in any
instance shall not constitute
| COMMERCIAL GUARANTY | ||||
| Loan No: 479195 | (Continued) | Page 3 |
continuing consent to subsequent instances where such
consent is required and in all cases such consent may be
granted or withheld in the sole discretion of Lender.
Successors and Assigns. Subject to any limitations stated in this Guaranty
on transfer of Guarantor’s interest, this Guaranty shall be binding upon and
inure to the benefit of the parties, their successors and assigns.
Waive Jury. Lender and Guarantor hereby waive the right to any jury trial in
any action, proceeding, or counterclaim brought by either Lender or Borrower
against the other.
DEFINITIONS.
The following capitalized words and terms shall have the following
meanings when used in this Guaranty. Unless specifically stated to the contrary,
all references to dollar amounts shall mean amounts in lawful money of the
United States of America. Words and terms used in the singular shall include the
plural, and the plural shall include the singular, as the context may require.
Words and terms not otherwise defined in this Guaranty shall have the meanings
attributed to such terms in the Uniform Commercial Code:
Borrower.
The word “Borrower” means Z-AXIS CORPORATION
and includes all co-signers and co-makers signing the
Note and all their successors and assigns.
Guarantor. The word “Guarantor” means everyone signing
this Guaranty, including without limitation XXXX
XXXXXXXX, and in each case, any signer’s successors and
assigns.
Guaranty. The word “Guaranty” means this guaranty from
Guarantor to Lender.
Indebtedness. The word “Indebtedness” means Borrower’s
indebtedness to Lender as more particularly described in
this Guaranty.
Lender.
The word “Lender” means COLORADO BUSINESS BANK, its successors and
assigns.
Note.
The word “Note” means and includes without limitation all of
Borrower’s promissory notes and/or credit agreements evidencing Borrower’s
loan obligations in favor of Lender, together with all renewals of,
extensions of, modifications of, refinancings of, consolidations of and
substitutions for promissory notes or credit agreements.
Related
Documents. The words “Related Documents” mean all promissory notes,
credit agreements, loan agreements, environmental agreements, guaranties,
security agreements, mortgages, deeds of trust, security deeds, collateral
mortgages, and all other instruments, agreements and documents, whether now
or hereafter existing, executed in connection with the indebtedness.
EACH
UNDERSIGNED GUARANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF
THIS
GUARANTY AND AGREES TO ITS TERMS. IN ADDITION, EACH GUARANTOR UNDERSTANDS THAT
THIS GUARANTY IS EFFECTIVE UPON GUARANTOR’S EXECUTION AND DELIVERY OF THIS
GUARANTY TO LENDER AND THAT THE GUARANTY WILL CONTINUE UNTIL TERMINATED IN THE
MANNER SET FORTH IN THE SECTION TITLED “DURATION OF GUARANTY”. NO FORMAL
ACCEPTANCE BY LENDER IS NECESSARY TO MAKE THIS GUARANTY EFFECTIVE. THIS
GUARANTY IS DATED AUGUST 2, 2006.
GUARANTOR:
X
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/s/ XXXX XXXXXXXX | |||
| XXXX XXXXXXXX |
