IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT
PIAP LOAN AGREEMENT
PIAP LOAN NUMBER: 05-PIAP-13
AWARD DATE: June 28, 2005
KIND OF AWARD: Forgivable Loan
AWARD AMOUNT: $150,000
AGREEMENT EXPIRATION DATE: July 31, 2010
THIS PHYSICAL INFRASTRUCTURE ASSISTANCE PROGRAM ("PIAP") AGREEMENT is
made by and between the IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT, 000 Xxxx Xxxxx
Xxxxxx, Xxx Xxxxxx, Xxxx 00000 ("Department" or "IDED") Hydrogen Engine Center,
000 X. Xxxx Xxxxxx, Xxxxxx, Xxxx 00000 ("Business").
The Department desires to make a loan to the Business and the Business
desires to accept this loan, all upon the terms and conditions set forth in this
Agreement.
THEREFORE, in consideration of the mutual promises contained in this
Agreement and other good and valuable consideration, it is agreed as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement, the following terms shall apply:
1.1 AGREEMENT EXPIRATION DATE. "Agreement Expiration Date" means the
date the Agreement ceases to be in force and effect. The Agreement expires upon
the occurrence of one of the following: a) the Loan is repaid in full or
required part, including accrued interest, court costs and any penalties; b) the
Agreement is terminated by the Department due to any default under Article X; c)
no disbursement of PIAP funds has occurred within the twenty four months
immediately following the Award Date; or d) if the Agreement includes only a
Forgivable Loan, at the Project Completion Date.
1.2 AWARD DATE. "Award Date" means June 28, 2005.
1.3 FORGIVABLE LOAN. "Forgivable loan" means an award made by the
Department to the Business for which repayment is eliminated in part or entirely
if the Business satisfies the terms of this Agreement.
1.4 LOAN. "Loan" means funds advanced by the Department to the Business
of which full repayment is expected.
1.5 LOAN AGREEMENT or AGREEMENT. "Loan Agreement" or "Agreement" means
this document, the Project budget and all of the notes, leases, assignments,
mortgages, and similar documents referred to in this document and all other
instruments or documents executed by the Business or otherwise required in
connection with this document, including but not limited to the following:
(a) Exhibit "A", "Application"
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(b) Exhibit "B", Hydrogen Engine Center Promissory Note" dated June
28, 2005
(d) Exhibit "C", "Commitment Letter" dated July 7, 2005
(e) Exhibit "D", "Uniform Commercial Code I (UCC I) Filing(s)
(f) Exhibit "E", "Program Description and Budget" dated August, 2005
1.6 PROJECT. "Project" means the detailed description of the work,
services, and other obligations to be performed or accomplished by the Business
as described in the Agreement, Exhibit E - Program Description and Budget, and
the PIAP application approved by the Department.
1.7 PROJECT COMPLETION DATE. "Project Completion Date" means
July 31, 2010 and is the date by which the Project tasks shall have been fully
accomplished.
ARTICLE II
FUNDING
2.1 FUNDING SOURCE. As of the Award Date of this Agreement, the source
of funding for the Loan is an appropriation by the State legislature for the
PIAP Program established under Iowa Code Section 15E.175. In the event that
funding for the Iowa Values Fund is restored the funding source for this
Agreement shall automatically be allocated to the Iowa Values Fund or its
successor funding source. Business shall execute any documents IDED determines
are necessary to implement a change in funding source.
2.2 RECEIPT OF FUNDS. All payments under this Agreement are subject to
receipt by the Department of sufficient State funds for the PIAP program. Any
termination, reduction or delay of PIAP funds to the Department shall, at the
option of the Department, result in the termination, reduction or delay of PIAP
funds to the Business.
2.3 PRIOR COSTS. No expenditures made prior to the Award Date may be
included as Project costs for the purposes of this Agreement.
2.4 DISBURSEMENT OF LESS THAN THE TOTAL AWARD AMOUNT. If substantial
progress toward work activities as specified in the Agreement, Exhibit "A",
Exhibit "E" of this Agreement has not been made within two hundred forty (240)
days of the Award Date, then the Department shall be under no obligation for
further disbursement. The Business shall be obligated to the extent of Loan
proceeds received prior to that date.
ARTICLE III
TERMS OF LOAN
Not Applicable
ARTICLE IV
TERMS OF FORGIVABLE LOAN
4.1 FORGIVABLE LOAN. The Department agrees to award a Forgivable Loan
in the amount of one hundred fifty thousand dollars ($150,000) to assist in the
financing of the Project.
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4.2 PROMISSORY NOTES. The obligation to repay the Forgivable Loan
portion of this Agreement, if any, shall be evidenced by a Promissory Note(s)
executed by the Business.
4.3 OTHER TERMS.
a). The Forgivable Loan funds will be used by the Business for cost s
related to the construction and equipping of a 30,000 square foot
facility to produce a 4.9 liter hydrogen engine.
b). The Business will make an total investment of at least $1,543,316
for building construction, machinery and equipment, and working
capital.
c) The Business will create 49 full time equivalent (FTE) positions,
with 38 positions at a starting wage exceeding $11.76/hour, and an
average wage for all positions of $24.94/hour.
4.4 FORGIVABLE LOAN AMORTIZATION. If the award includes a Forgivable
loan the Department will, in its reasonable discretion, determine if the
Business has satisfied the terms of this Agreement by the Project Completion
Date. If the Department determines that the Business has satisfied said terms as
of the Project Completion Date, then repayment of the Forgivable loan shall be
permanently waived. Should the Department determine that the Business has not
satisfied the terms of this Agreement, or has operated in a manner substantially
inconsistent with the Application under which the terms of the award was made,
the Business may be required to repay all or part of the Forgivable loan funds.
ARTICLE V
CONDITIONS TO DISBURSEMENT OF FUNDS
Unless and until the following conditions have been satisfied, the
Department shall be under no obligation to disburse to the Business any amounts
under this Agreement:
5.1 AUTHORITY. The Business shall have submitted the following documents to
the Department:
(a) Certificate of Good Standing of the Corporation.
(b) Certified copy of the Articles of Incorporation and By-Laws.
(c) Certificate of Incumbency naming the current officers and directors
of the corporation.
(d) Resolution of the Board of Directors authorizing the corporation's
execution and delivery of this Loan Agreement and the Note and
borrowing hereunder, and such other papers as the Department may
reasonably request; and specifying the officer(s) authorized to execute
the Loan Agreement and bind the corporation.
(e) Uniform Commercial Code I filing (with copies) showing any and all
liens that may exist on Business' assets.
(f) Verification of a minimum investment in the infrastructure activity
in the same ratio of leveraged funds to PIAP funds as described in this
Agreement, Exhibit "A" and Exhibit "E", unless prior approval is
obtained from the Department.
(g) Documentation of satisfactory credit history of the Business with
no judgments or unsatisfied liens.
(h) Evidence of active pursuit other funding commitments from other
sources of funds.
5.2 LOAN AGREEMENT EXECUTED. The Loan Agreement shall have been
properly executed and, where required, acknowledged.
5.3 RECORDING. The Business shall have paid the fees necessary to
properly record in the appropriate office of the Recorder of Deeds and/or the
Secretary of State any mortgage, security agreement, financing statement or
similar document required by the Department under the Agreement.
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ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF BUSINESS
To induce the Department to make the Loan and/or Forgivable Loan
referred to in this Agreement, the Business represents, covenants and warrants
that:
6.1 AUTHORITY. The Business is a corporation duly organized and validly
existing under the laws of the state of incorporation and is in good standing,
and has complied with all applicable laws of the State of Iowa. The Business is
duly authorized and empowered to execute and deliver the Agreement. All action
on the Business' part, such as appropriate resolution of its Board of Directors
for the execution and delivery of the Agreement, has been effectively taken.
6.2 FINANCIAL INFORMATION. All financial statements and related
materials concerning the Business and the Project provided to the Department are
true and correct in all material respects and completely and accurately
represent the subject matter thereof as of the effective date of the statements
and related materials, and no material adverse change has occurred since that
date.
6.3 APPLICATION. The contents of the application/business plan
submitted by the Business to the Department for PIAP funding is a complete and
accurate representation of the Business and the Project as of the date of
submission and there has been no material adverse change in the organization,
operation, business prospects, fixed properties, key personnel or project plan
of the Business since the date the Business submitted its PIAP application to
the Department.
6.4 CLAIMS AND PROCEEDINGS. There are no actions, lawsuits or
proceedings pending or, to the knowledge of the Business, threatened against the
Business affecting in any manner whatsoever its right to execute the Agreement
or the ability of the Business to make the payments required under the
agreement, or to otherwise comply with the obligations of the Business contained
under the Agreement. There are no actions, lawsuits or proceedings at law or in
equity, or before any governmental or administrative authority pending or, to
the knowledge of the Business, threatened against or affecting the Business or
any property or collateral pledged as security for the Loan.
6.5 EFFECTIVE DATE. The covenants, warranties and representations of
this Article are made as of the date of this Agreement and shall be deemed to be
renewed and restated by the Business at the time of each advance or request for
disbursement of funds.
ARTICLE VII
COVENANTS OF BUSINESS
7.1 AFFIRMATIVE COVENANTS. Until payment in full of the Loan or until
the Forgivable Loan is forgiven, and satisfaction of terms of this Agreement,
the Business covenants to IDED that:
(a) PROJECT WORK AND SERVICES. The Business shall complete the work and
services detailed in its PIAP application, Section 4.3 of this Agreement, and
"Exhibit E" by the Project Completion Date.
(b) RECORDS AND ACCOUNTS. The Business shall maintain books, records,
documents and other evidence pertaining to all costs and expenses incurred and
revenues received under this Agreement concerning the project, in sufficient
detail to reflect all costs, direct and indirect, of labor, materials,
equipment, supplies, services and other costs and expenses of whatever nature,
for which payment is claimed under this Agreement. The Business shall retain all
records for a period of three (3) years from the Agreement Expiration Date.
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(c) ACCESS TO RECORDS/INSPECTIONS. The Business shall, without prior
notice and at any time (during normal business hours), permit the Department,
its representatives or the State Auditor to examine, audit and/or copy (I) any
plans and work details pertaining to the Project, (ii) all of the Business'
books, records and accounts, and (iii) all other documentation or materials
related to this Agreement; the Business shall provide proper facilities for
making such examination and/or inspection.
(d) USE OF LOAN FUNDS. The Business shall expend funds received under
the Loan and/or Forgivable Loan only for the purposes and activities described
in its PIAP Application, Section 4.3 of this Agreement, Exhibit "F", and
approved by the Department.
(e) DOCUMENTATION. The Business shall deliver to the IDED, upon
request, (I) copies of all contracts or agreements relating to the Project, (ii)
invoices, receipts, statements or vouchers relating to the Project, (iii) a list
of all unpaid bills for labor and materials in connection with the Project, (iv)
budgets and revisions showing estimated Project costs and funds required at any
given time to complete and pay for the Project, and (v) current and year-to-date
operating statements, including but not limited to a Profit and Loss and Balance
Sheet.
(f) NOTICE OF PROCEEDINGS. The Business shall promptly notify IDED of
the initiation of any claims, lawsuits, bankruptcy proceedings or other
proceedings brought against the Business which would adversely impact the
project, including, but not limited to, any proceedings to assert or enforce
liens against collateral securing the Loan.
(g) REQUIRED REPORTS.
(i) Review of Disbursement Requests and Reports. The Business shall
prepare, sign and submit disbursement requests and reports as specified in this
Master Contract in the form and content required by IDED. The Business shall
review all reimbursement requests and verify that claimed expenditures are
allowable costs. The Business shall maintain documentation adequate to support
the claimed costs.
(ii) Annual Public Return on Investment (ROI) Update. Prior to
disbursement of funds, the Business shall execute an Authorization for Release
of Confidential State Tax Information form. This permits IDED to receive the
Business's state tax information directly from the Iowa Department of Revenue
for purposes of annually updating the Iowa Public Return on Investment Analysis
for this Project. Each year, the Business shall submit to IDED any other
information requested by IDED to update the Iowa Public Return on Investment
Analysis for this Project. The End-of -Year Status Report described below will
be the report used to collect information for this annual ROI update.
(iii) The Business shall prepare, sign and submit the following reports
to the IDED throughout the Contract period:
Report Due Date
------ --------
Mid-Year Status Report ............................ July 10th for the period
ending June 30th
End-of-Year Status Report Includes:................. January 31st for the period
ending Dec. 31st
- Public Return on Investment (ROI) Update
- Payroll Register with all created and/or
retained jobs highlighted and indicate
the Project Jobs paying the required wage
- "Employer's Contribution and Payroll Report"
End of Project Report .............................. Within 30 days of Project
Completion Date
Report content: same items as End-of-Year Report
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End of Job Maintenance Period Report ............... Within 30 days of the end
of the Project Maintenance
Period
Report Content: same items as End-of-Year Report
(iv) Additional Reports, Financials as Requested by IDED. The IDED
reserves the right to require more frequent submission of any of the above
reports if, in the opinion of the IDED, more frequent submissions would help
improve the Business's Project performance, or if necessary in order to meet
requests from the Iowa General Assembly, the Department of Management or the
Governor's office. At the request of IDED, Business shall submit its annual
financial statements completed by an independent CPA, or other financial
statements including, but not limited to, income, expense, and retained earnings
statements.
(h) NOTICE OF BUSINESS CHANGES. The Business shall provide prompt
advance notice to the Department of any proposed change in the Business
ownership, structure or control which would materially affect the Project.
(i) NOTICE OF MEETINGS. The Business shall notify the Department at
least ten (10) working days in advance of all Board of Directors and
Stockholders meetings at which the subject matter of this Agreement or Project
is proposed to be discussed. The Business shall provide the Department with
copies of the agenda and minutes of such meetings and expressly agrees that a
representative of the Department has a right to attend any and all such meetings
for the purposes of the discussion of the Project and the Loan and/or Forgivable
Loan.
(j) MAINTENANCE OF PROJECT PROPERTY AND INSURANCE. The Business shall
maintain the Project property in good repair and condition, ordinary wear and
tear excepted, and shall not suffer or commit waste or damage upon the Project
property. At the Department's request, the Business shall pay for and maintain
insurance against loss or damage by fire, tornado, and other hazards,
casualties, and contingencies and all risks from time to time included under
"extended coverage" policies. This insurance shall be in an amount not less than
the full insurable value of the Project property. The Business shall name the
Department as a mortgagee and/or an additional loss payee as appropriate and
submit copies of the policies to the Department.
(k) INDEMNIFICATION. The Business shall indemnify and hold harmless the
Department, its officers and employees, from and against any and all losses,
except those losses incurred by the Department resulting from willful misconduct
or negligence on its or their part.
(l) PROJECT FEES. The Business shall promptly pay all appraisal,
survey, recording, title, license, permit and other fees and expenses incurred
incident to the Loan/Forgivable Loan.
(m) INTEREST AND SURPLUS PROCEEDS. The Business shall return all
unexpended Loan/Forgivable Loan proceeds and interest accrued on Loan/Forgivable
Loan proceeds to the Department within thirty (30) days after the Project
Completion Date.
7.2 NEGATIVE COVENANTS. So long as the Business is indebted to IDED,
the Business shall not, without prior written disclosure to IDED and prior
written consent of IDED (unless IDED prior approval is expressly waived below),
directly or indirectly:
(a) BUSINESS' INTEREST. Assign, waive or transfer any of Business'
rights, powers, duties or obligations under this Agreement.
(b) PROPERTY/COLLATERAL. Other than in the ordinary course of business,
provided that substitute collateral of equal or greater value is acquired or
secured by the business, sell, transfer, convey, assign, encumber or otherwise
dispose of any of the real property or other collateral securing the
Loan/Forgivable Loan.
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(c) RESTRICTIONS. Place or permit any restrictions, covenants or any
similar limitations on the real property and/or other collateral securing the
Loan/Forgivable Loan.
(d) REMOVAL OF COLLATERAL. Remove from the Project site or the State
all or any part of the collateral securing the Loan.
(e) BUSINESS OWNERSHIP. Materially change the ownership, structure, or
control of the business affecting the Project, including but not limited to,
entering into any merger or consolidation with any person, firm or corporation
or permitting substantial distribution, liquidation or other disposal of
business assets directly associated with the Project. Changes in the business
ownership, structure or control which do not materially affect the Project shall
require forty-five (45) days prior written notice of the Department, but not
written consent of, the Department. The materiality of the change and whether or
not the change affects the Project shall be determined by the Department.
(f) BUSINESS OPERATION. Materially change the nature of the business
being conducted, or proposed to be conducted, as described in the Business'
application for PIAP funding.
ARTICLE VIII
SECURITY
8.1 SECURITY INSTRUMENTS. The Business shall execute in favor of the
Department all security agreements, financing statements, mortgages, personal
and/or corporate guarantees (hereafter, "Security Instruments") as required by
the Department. The following Security Instruments shall be executed by the
Business.
(a) Blanket UCC1 security filing on general business assets
ARTICLE IX
DEFAULT AND REMEDIES
9.1 EVENTS OF DEFAULT. Each of the following shall constitute an Event
of Default under this Agreement:
(a) MATERIAL MISREPRESENTATION. If at any time any representation,
warranty or statement made or furnished to the Department by, or on behalf of,
the Business in connection with this Agreement or to induce the Department to
make a loan/Forgivable Loan to the Business shall be determined by the
Department to be incorrect, false, misleading or erroneous in any material
respect when made or furnished and shall not have been remedied to the
Department's satisfaction within thirty (30) days after written notice by the
Department is given to the Business.
(b) NON-PAYMENT. If the Business fails to make a payment when due under
the terms of this Agreement within thirty (30) days following written notice of
such overdue payment is given to the Business by the Department.
(c) NONCOMPLIANCE. If there is a failure by the Business to comply with
any of the covenants, terms or conditions contained in this Agreement or
Security Instruments executed pursuant to this Agreement.
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(d) CROSS DEFAULT. The Department may elect to terminate this Agreement
and demand repayment of PIAP funds, up to the full amount of this Agreement, and
levy appropriate penalties if the Business should fail to satisfy obligations
under any state financial assistance program contract(s) identified below:
CEBA Contract #: 00-XXXX-00
Xxxxxxxxxx Zone Contract #: 05-EZ-37
(e) PROJECT COMPLETION DATE. If the Project, in the sole judgment of
the Department, is not completed on or before the Project Completion Date.
(f) BUSINESS CHANGES. If there is a material change in the Business
ownership, structure, or control which occurs without the prior written
disclosure to and if required, written permission of the Department.
(g) MISSPENDING. If the Business expends Loan/Forgivable Loan proceeds
for purposes not described in the PIAP application or authorized by the
Department.
(h) INSOLVENCY OR BANKRUPTCY If the Business becomes insolvent or
bankrupt, or admits in writing its inability to pay its debts as they mature, or
makes an assignment for the benefit of creditors, or the Business applies for or
consents to the appointment of a trustee or receiver for the Business or for the
major part of its property; or if a trustee or receiver is appointed for the
Business or for all or a substantial part of the assets of the Business and the
order of such appointment is not discharged, vacated or stayed within sixty (60)
days after such appointment; or if bankruptcy, reorganization, arrangement,
insolvency, or liquidation proceedings or other proceedings for relief under any
bankruptcy or similar law or laws for the relief of debtors, are instituted by
or against the Business and, if instituted against the Business, is consented
to, or, if contested by the Business is not dismissed by the adverse parties or
by an order, decree or judgment within sixty (60) days after such institution.
(i) INSURANCE. If loss, theft, damage or destruction of any substantial
portion of the property of the Business occurs for which there is either no
insurance coverage or for which, in the opinion of the Department, there is
insufficient insurance coverage.
(j) INSECURITY. If the Department shall deem itself insecure in good
faith and reasonably believes, after consideration of all the facts and
circumstances then existing, that the prospect of payment and satisfaction of
the obligations under this Agreement, or the performance of or observance of the
covenants in this Agreement, or the value of its collateral is or will be
materially impaired.
9.2 NOTICE OF DEFAULT. The Department shall issue a written notice of
default providing therein a thirty (30) day period in which the Business shall
have an opportunity to cure, provided that cure is possible and feasible.
9.3 REMEDIES UPON DEFAULT. Upon the happening of any Event of Default,
the Department shall have the right, in addition to any rights and remedies
available to it under any of the Security Instruments, to require immediate
repayment of the full amount of funds disbursed to the Business under the
Agreement plus interest without presentment, demand, protest, notice of protest,
notice of intention to accelerate or other notice of any kind, all of which are
expressly waived by the Business.
ARTICLE X
DISBURSEMENT PROCEDURES
10.1 REQUEST FOR REIMBURSEMENT. All disbursements of proceeds shall be
subject to receipt by the Department of requests for disbursement submitted by
the Business. Requests for disbursement shall be in form and content acceptable
to the Department.
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ARTICLE XI
GENERAL TERMS AND PROVISIONS
11.1 BINDING EFFECT. This Agreement shall be binding upon and shall
inure to the benefit of the Department and Business and their respective heirs,
successors, legal representatives and assigns. The obligations, covenants,
warranties, acknowledgments, waivers, agreements, terms, provisions and
conditions of this Agreement shall be jointly and severally enforceable against
the parties to this Agreement.
11.2 COMPLIANCE WITH LAWS AND REGULATIONS. The Business shall comply
with all applicable State and federal laws, rules, ordinances, regulations and
orders.
11.3 TERMINATION FOR CONVENIENCE. In addition to termination due to an
Event of Default or nonappropriation of PIAP funds, this Agreement may be
terminated in whole, or in part, when the Department and the Business agree that
the continuation of the Project would not produce beneficial results
commensurate with the future disbursement of Loan/Forgivable Loan funds. The
Department and the Business shall agree upon the termination conditions. The
Business shall not incur new obligations after the effective date of the
termination and shall cancel as many outstanding obligations as is reasonably
possible.
11.4 PROCEDURE UPON TERMINATION. If the Agreement is terminated for
convenience, an Event of Default or nonappropriation of PIAP funds,
disbursements shall be allowed for costs up to the date of termination
determined by the Department to be in compliance with this Agreement. The
Business shall return to the Department all unencumbered Loan/Forgivable Loan
proceeds within one (1) week of receipt of Notice of Termination. Any costs
previously paid by the Department which are subsequently determined to be
unallowable through audit procedures shall be returned to the Department within
thirty (30) days of the disallowance.
11.5 SURVIVAL OF AGREEMENT. If any portion of this Agreement is held to
be invalid or unenforceable, the remainder shall be valid and enforceable. The
provisions of this Agreement shall survive the execution of all instruments
herein mentioned and shall continue in full force until the Loan is paid in full
and the terms of the Forgivable Loan have been satisfied.
11.6 GOVERNING LAW. This Agreement and all Security Instruments shall
be interpreted in accordance with the law of the State of Iowa, and any action
relating to the Agreement shall only be commenced in the Iowa District Court for
Polk County or the United States District Court for the Southern District of
Iowa.
11.7 MODIFICATION. Neither this Agreement nor any provision of the
Security Instruments executed in connection with this Agreement may be changed,
waived, discharged or terminated orally, but only by a written document signed
by the party against whom enforcement of the change, waiver, discharge or
termination is sought.
11.8 NOTICES. Whenever this Agreement requires or permits any notice or
written request by one party to another, it shall be in writing, enclosed in an
envelope, addressed to the party to be notified at the address heretofore stated
(or at such other address as may have been designated by written notice),
properly stamped, sealed and deposited in the United States Mail. Any such
notice given hereunder shall be deemed delivered upon the earlier of actual
receipt or two (2) business days after posting. The Department may rely on the
address of the Business set forth heretofore, as modified from time to time, as
being the address of the Business.
11.9 INVESTMENT OF LOAN/FORGIVABLE LOAN FUNDS. Temporarily idle
Loan/Forgivable Loan proceeds held by the Business may be invested provided such
investments shall be in accordance with State law, shall be controlled by the
Business, and any interest accrued shall be credited to and expended on the
Project prior to the expenditure of other Loan/Forgivable Loan proceeds. All
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proceeds remaining, including accrued interest, after all allowable Project
costs have been paid or obligated shall be returned to the Department within
thirty (30) days after the Project Completion Date.
11.10 RESOLUTION OF DISAGREEMENT. In the event of any disagreement
between the parties to this Agreement relating to the technical competence of
the work and services being performed and its conformity to the requirements of
this Agreement, the Department shall resolve the disagreement. The decision of
the Department shall be binding on the Business.
11.11 WAIVERS. No waiver by the Department of any default hereunder
shall operate as a waiver of any other default or of the same default on any
future occasion. No delay on the part of the Department in exercising any right
or remedy hereunder shall operate as a waiver thereof. No single or partial
exercise of any right or remedy by the Department shall preclude future exercise
thereof or the exercise of any other right or remedy.
11.12 LIMITATION. It is agreed by the Business that the Department
shall not, under any circumstances, be obligated financially under this
Agreement except to disburse funds according to the terms of the Agreement.
11.13 ENFORCEMENT EXPENSES. The Business shall pay upon demand any and
all reasonable fees and expenses relating to this project of the Department,
including the fees and expenses of their attorneys, experts and agents, in
connection with the exercise or enforcement of any of the rights of the
Department under the Agreement.
11.14 HEADINGS. The headings in this Agreement are intended solely for
convenience of reference and shall be given no effect in the construction and
interpretation of this Agreement.
11.15 FINAL AUTHORITY. The Department shall have the final authority to
assess whether the Business has complied with the terms of this Agreement.
11.16 INTEGRATION. This Agreement contains the entire understanding
between the Business and the Department and any representations that may have
been made before or after the signing of this Agreement, which are not contained
herein, are nonbinding, void and of no effect. None of the parties have relied
on any such prior representation in entering into this Agreement.
11.17 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement effective
as of the Award Date first stated.
HYDROGEN ENGINE CENTER:
BY: /s/ Xxxxxxxx X. Xxxxxxxxx
------------------------------------------------
Name: XXXXXXXX X. XXXXXXXXX Title: President
IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT:
BY: /s/ Xxxx Lawyer
------------------------------------------------
Xxxx Lawyer, Director
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ATTACHMENT B
PROMISSORY NOTE
Hydrogen Engine Center
IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT
PIAP PROGRAM
PROMISSORY NOTE
Loan Number 05-PIAP-13
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Des Moines, Iowa
-------------------------
(City and State)
$ 150,000 June 28, 2005
-------------------------- -------------------------
(Date)
FOR VALUE RECEIVED, the undersigned (hereafter called the "Maker")
promises to pay to the order of the State of Iowa, Department of Economic
Development (hereafter called the "Payee"), at its office at 000 Xxxx Xxxxx
Xxxxxx, Xxx Xxxxxx, Xxxx 00000, or upon notice to the Maker, at such other place
as may be designated from time to time by the holder, the principal sum of one
hundred fifty thousand dollars ($150,000), to be paid as follows:
A one hundred fifty thousand dollar ($150,000) forgivable loan at six (6%)
percent interest to be paid as follows:
A five year $150,000 forgivable loan. There will be no
principal or interest payments or accruals for years one, two,
three, four and five from the Agreement Award Date of June 28,
2005. At the project completion date, if the Maker has
fulfilled the terms of the forgivable loan, the balance will
be forgiven. Should a shortfall in meeting the terms of the
forgivable loan exist at the end of year five, the balance of
the forgivable loan determined by the Payee as due and payable
will be amortized over three years from the Agreement
Expiration Date of July 31, 2010 at six (6%) percent interest
per annum with equal quarterly payments.
1. Payments. All payments under the Note shall be applied in this
order: (1) to interest, and (2) to principal.
2. Loan Agreement; Acceleration Upon Default. This Note is issued by
Maker to evidence an obligation to repay a loan according to the terms of Loan
Agreement 05-PIAP-13 of June 28, 2005 between the Payee and Maker and, at the
election of the holder without notice to the Maker, shall become immediately due
and payable in the event any payment is not made when due or upon the occurrence
of any event of default under the terms of the Loan Agreement.
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3. Reduced Amount. In the event the Maker fails to requisition and
spend the full face amount of the Note as set out above, then the amount of each
installment payment shall be reduced accordingly in equal amounts.
4. Security. Payment of this Note is secured by a Blanket UCC 1 on
general business assets, and the holder is entitled to the benefits of the
security therein described.
In case of a decline in the market value of the collateral, or any part
thereof, the Payee may demand that additional collateral of quality and value
satisfactory to holder be delivered, pledged and transferred to holder.
5. Waiver. No delay or omission on the part of the holder in exercising
any right under this Note shall operate as a waiver of that right or of any
other right under this Note. A waiver on any one occasion shall not be construed
as a bar to or waiver of any right and/or remedy on any future occasion.
6. Waiver of Protest. Each maker, surety, endorser and guarantor of
this Note, expressly waives presentment, protest, demand, notice of dishonor or
default, and notice of any kind with respect to this Note.
7. Costs of Collection. The Maker will pay on demand all costs of
collection, maintenance of collateral, legal expenses, and attorneys' fees
incurred or paid by the holder in collecting and/or enforcing this Note on
default.
8. Meaning of Terms. As used in this Note, "holder" shall mean the
Payee or other endorsee of this Note, who is in possession of it, or the bearer
hereof, if this Note is at the time payable to the bearer. The word "Maker"
shall mean each of the undersigned. If this Note is signed by more than one
person, it shall be the joint and several liabilities of such persons.
9. Miscellaneous. The captions of paragraphs in this Promissory Note
are for the convenience of reference only, shall not define or limit the
provisions hereof and shall not have any legal or other significance whatsoever.
ADDRESS:
Hydrogen Engine Center
000 Xxxx Xxxx Xxxxxx
Xxxxxx, XX 00000 BY: /s/ Xxxxxxxx X. Xxxxxxxxx
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Date President
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ATTEST:
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