EXHIBIT 10.3
CREDIT AGREEMENT
THIS AGREEMENT made as of this 18th day of November, 1986, by XXXXXX
INVESTMENT CORPORATION, a Minnesota corporation (herein called the "Borrower"),
for the benefit of NATIONAL CITY BUSINESS CREDIT, INC., a Minnesota corporation
(herein called "NCBC") .
Recitals
Borrower has requested that NCBC make loans to Borrower from time to
time at NCBC's sole discretion and, in connection therewith, has executed and
delivered for NCBC's benefit a Security Agreement of even date herewith,
together with various additional and supplemental documents (herein called the
"Security Documents"):
This Agreement sets forth certain additional obligations undertaken by
Borrower to induce NCBC to make such loans.
ACCORDINGLY, to induce NCBC to make one or more loans to Borrower, and
for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Borrower hereby represents, warrants and agrees for the
benefit of NCBC that:
1. The Loans. NCBC shall not be obligated to make any loans to
Borrower. All loans which NCBC may determine to make under this Agreement shall
be repayable on demand. Borrower will comply with the following procedure in
requesting loans from NCBC:
(a) Borrower will request loans from NCBC in such a manner as
NCBC may from time to time prescribe.
(b) NCBC may make loans in any amount and in any manner
requested orally or in writing (i) by any officer of Borrower; or (ii)
by any person designated as Borrower's agent by any officer of Borrower
in a writing delivered to NCBC; or (iii) by any person reasonably
believed by NCBC to be an officer of Borrower or such a designated
agent. Except as otherwise instructed in writing by such officer, agent
or person, NCBC may disburse loan proceeds by deposit with any bank to
or for the account of Borrower or to or for the account of any third
party designated by such officer, agent or person, or by an instrument
payable to Borrower or to any such third party delivered to any such
officer, agent or person or to any such third party, or in any other
manner deemed appropriate by NCBC. All principal of and interest on
loans made by NCBC shall be repayable at the offices of NCBC in
Minneapolis, Minnesota, unless NCBC designates a different place of
payment by written notice to Borrower.
(c) NCBC may make loans on the basis of collateral available
under the Security Documents or any other basis deemed appropriate by
NCBC from time to time. NCBC may change from time to time, at its sole
discretion and without notice to Borrower, the standards, criteria and
formulae used by NCBC in determining the type and amount of collateral
eligible for advance. In any event, subject to change at NCBC's
discretion, Borrower shall not request loans on the basis of the
following collateral:
(1) Accounts receivable which are (i) disputed or
subject to claims or set offs; or (ii) owed by an account
debtor not located in the United States or Canada and not
secured by a bank letter of credit satisfactory to NCBC in its
sole discretion; or (iii) owed by an account debtor which is
the subject of any bankruptcy or insolvency proceedings or is
insolvent or has made an assignment for the benefit of
creditors or has failed or suspended or gone out of business.
(2) Collateral which is not warranted in the Security
Documents.
(3) Collateral which NCBC, in its sole discretion,
has declared ineligible collateral by written notice to
Borrower.
(4) Except for accounts receivable described under
subsection 1(c)(5), accounts receivable not paid within thirty
(30) days after invoice or, if NCBC in its discretion has
determined that a particular dated receivable is eligible for
advance, within thirty (30) days after the due date stated.
(5) Accounts receivable arising under contracts for
deed which are more than two (2) installments in arrears.
(6) Accounts receivable owed to Borrower by any
shareholder, subsidiary or affiliate of Borrower or by any
person obligated to pay any receivable deemed ineligible under
clauses (1) through (4), if such ineligible receivable is 10%
or more of the total amount due from such person.
Notwithstanding any apportionment, exclusion or segregation of
collateral made by NCBC for purposes of determining the amount or
maximum amount of loans made to Borrower, all collateral granted to
NCRC under the Security Documents, and the rights and interests of NCBC
under the Security Documents, and all other collateral rights,
interests and properties available to NCBC, shall secure and may be
applied to pay any or all indebtedness of Borrower secured thereby, in
any manner or order of application and without regard to any such
apportionment, exclusion or segregation.
(d) Borrower will pay interest on all outstanding loans under
this Agreement at an annual rate (computed on the basis of actual days
elapsed in a 350-day year) which, for any particular month, shall be
the greater of (i) nine percent (9%) per annum, or (ii) three and
one-half percent (3.5%) per annum above the rate of interest publicly
announced by National City Bank of Minneapolis from time to time as its
"BASE" rate (the Bank may lend to its customers at rates that are at,
above, or below the "BASE" rate); provided, that in any event no rate
change shall be put into effect which would result in a rate greater
than the highest rate permitted by law. Each change in the interest
rate shall take effect simultaneously with the corresponding change in
the designated bank's "BASE" rate.
-2-
All interest shall accrue on the principal balance outstanding
from time to time and shall be payable monthly and in any event on
demand. Borrower agrees that NCBC may at any time or from time to time,
without further request by Borrower, make a loan to Borrower, or apply
the proceeds of any loan, for the purpose of paying all such interest
promptly when due. In the computation of interest, NCBC may allow three
banking days for the collection of uncollected funds.
(e) If any bank shall acquire a participation in loans under
this Agreement and shall elect to accept interest with respect to such
participation at a lesser rate than the rate of interest set forth in
paragraph 1(d), the rate of interest payable by Borrower with respect
to such participation shall be reduced to an amount one-half percent
(1/2%) in excess of such lesser rate of interest, if, to the extent
that and so long as such bank shall hold such participation. NCBC may
retain the excess one-half percent (1/2%) as a servicing fee, free from
any claim by Borrower or any participant. NCBC shall not be obligated
to request, induce or permit any bank to acquire or to retain any
participation at all or in any particular amount or at any particular
rate of interest or on any particular terms.
(f) In addition to the interest provided for in Paragraph 1(d)
hereof, payable on all outstanding loans under this Agreement, Borrower
shall pay NCBC, on the date of this Agreement and on each anniversary
date thereafter, the sum of Twenty Thousand Dollars ($20,000.00), which
sum shall be due and payable without regard to the amount of loans
outstanding hereunder.
(g) NCBC may maintain from time to time, at its discretion,
liability records as to any and all loans made or repaid and interest
accrued or paid under this Agreement. All entries made on any such
record shall be presumed correct until Borrower establishes the
contrary. On demand by NCBC, Borrower will admit and certify in writing
the exact principal balance which Borrower then asserts to be
outstanding to NCBC for loans under this Agreement. Any billing
statement or accounting rendered by NCBC shall be conclusive and fully
binding on Borrower unless specific written notice of exception is
given to NCBC by Borrower within 30 days after its receipt by Borrower.
(h) Borrower's obligations with respect to all loans shall be
fully binding and enforceable without any note or other evidence of
indebtedness. Nevertheless, if NCBC so requests, Borrower will duly
execute and deliver to NCBC a promissory note negotiable in form,
payable on demand to the order of NCBC in a principal amount equal to
the principal balance then outstanding to NCBC for loans under this
Agreement, together with interest as set forth in paragraph 1(d).
(i) In requesting any loans under this Agreement, Borrower
shall be deemed to represent and warrant to NCBC that, as of the date
of the proposed loans, (i) all of the representations and warranties
made by paragraph 3 will be true and correct except for changes caused
by transactions permitted under this Agreement, and (ii) no breach or
-3-
default under, and no Event of Default defined or described in, this
Agreement or any of the Security Documents will exist.
2. Affiliate. For the purpose of this Agreement, "Affiliate" refers to
North Country Realty, Inc., a/k/a North Country Realty of Minnesota, Inc.; Four
Seasons Realty, Inc.; Four Seasons Realty of Brainerd, Inc.; D and P Land, Inc.;
and Lands End Realty, Inc.; and any other corporation, partnership, person or
entity which now or hereafter controls, is controlled by, or is under common
control with Borrower. Borrower agrees that any breach, default or event of
default by or attributable to any Affiliate under any agreement between such
Affiliate and NCBC shall constitute a breach of this Agreement and an Event of
Default under the Security Documents.
3. Representations and Warranties. Borrower represents and warrants to
NCBC that:
(a) Borrower is a corporation duly organized and existing in
good standing under the laws of the State of Minnesota. It has the
corporate power to own its property and to carry on its business as now
conducted and is duly qualified to do business in all states in which
such qualification is required. During its corporate existence,
Borrower has done business solely under the name Xxxxxx Investment
Corporation. Borrower does not own any capital stock of any
corporation, except North Country Realty, Inc., a/k/a North Country
Realty of Minnesota, Inc.; Four Seasons Realty, Inc.; Four Seasons
Realty of Brainerd, Inc.; D and P Land, Inc.; and Lands End Realty,
Inc.
(b) Borrower is duly authorized and empowered to execute,
deliver and perform this Agreement and the Security Documents and to
borrow money from NCBC.
(c) The execution and delivery of this Agreement and the
Security Documents, and the performance by Borrower of its obligations
thereunder, do not and will not violate or conflict with any provision
of law or the Articles of Incorporation or By-Laws of Borrower and do
not and will not violate or conflict with, or cause any default or
event of default to occur under, any agreement binding upon Borrower.
(d) The execution and delivery of this Agreement and the
Security Documents have been duly approved by all necessary action of
the directors and shareholders of Borrower; and this Agreement and the
Security Documents have in fact been duly executed and delivered by
Borrower and constitute its lawful and binding obligations, legally
enforceable against it in accordance with their respective terms
(subject to laws generally affecting the enforcement of creditors'
rights).
(e) No litigation, tax claims or governmental proceedings are
pending or are threatened against Borrower or any Affiliate and no
judgment or order of any court or administrative agency is outstanding
against Borrower or any Affiliate.
(f) The transaction evidenced by this Agreement does not
violate any law pertaining to usury or the payment of interest on
loans.
-4-
(g) The authorization, execution, delivery and performance of
this Agreement and the Security Documents are not and will not be
subject to the jurisdiction, approval or consent of, or to any
requirement of registration with or notification to, any federal, state
or local regulatory body or administrative agency.
(h) The proper places to file financing statements to perfect
the security interests created by the Security Documents are the
offices of the Secretary of State of Minnesota. When the financing
statements heretofore signed by Borrower are filed in the
aforementioned offices, NCBC will have a valid and perfected security
interest in all collateral described in the Security Documents, subject
to no prior security interest, assignment, lien or encumbrance (except
interests, if any, specifically approved by NCBC in writing).
(i) Payment of present and future debts, liabilities and
obligations of Borrower to NCBC has been guaranteed by Xxxxxx X. Xxxxxx
pursuant to one or more instruments of guaranty duly executed and
delivered and legally enforceable by NCBC, without further act and
without condition, in accordance with the stated terms (subject to laws
generally affecting the enforcement of creditors' rights).
(j) The conduct of its business by Borrower is not subject to
registration with, notification to, or regulation, licensing,
franchising, consent or approval by any state or federal governmental
authority or administrative agency, except general laws and regulations
which are not related or applicable particularly or uniquely to the
type of business conducted by Borrower, which do not materially
restrict or limit the business of Borrower, and with which Borrower is
in full compliance and except for regulation, registration with,
notification to, licensing, franchising, consent or approval by state
or federal authority as agency which Borrower has obtained or is in
full compliance with. All registrations and notifications required to
be made, and all licenses, franchises, permits, operating certificates,
approvals and consents required to be issued, to enter into or conduct
such business have been duly and lawfully made or obtained and issued,
and all terms and conditions set forth therein or imposed thereby have
been duly met and complied with.
(k) To the best knowledge of Borrower based upon reasonable
inquiry, no director, officer, employee or agent of, or consultant to,
Borrower is prohibited by law, by regulation, by contract, or by the
terms of any license, franchise, permit, certificate, approval or
consent from participating in the business of Borrower as director,
shareholder, partner, officer, employee or agent of, or as consultant
to, Borrower is the subject of any pending or, to Borrower's best
knowledge, threatened proceeding which, if determined adversely, would
or could result in such a prohibition.
(l) All assets of Borrower and any Affiliates are free and
clear of liens, security interests and encumbrances, except those
permitted under paragraph 5(b).
(m) Borrower and all Affiliates have filed all federal and
state tax returns which are required to be filed, and all taxes shown
as due thereon have been paid.
-5-
(n) Borrower has furnished financial statements for the
periods ending: March 31, 1985; December 31, 1985 and May 31, 1986.
These statements were prepared in accordance with generally accepted
accounting principles consistently maintained, present fairly the
financial condition of Borrower as at the dates thereof, and disclose
fully all liabilities of Borrower, whether or not contingent, with
respect to any pension plan. Since May 31, 1986, there has been no
material adverse change in the financial condition of Borrower.
(o) Each qualified retirement plan of Borrower presently
conforms to and is administered in a manner consistent with the
Employee Retirement Income Security Act of 1974.
(p) Borrower will not request or maintain any credit for the
purpose of purchasing or carrying any security, within the meaning of
Regulation G or U of the Board of Governors of the Federal Reserve
System.
4. Affirmative Covenants. Borrower covenants and agrees that it will:
(a) Use the proceeds of any and all loans made by NCBC solely
for lawful and proper corporate purposes of the Borrower.
(b) Pay all taxes, assessments and governmental charges prior
to the time when any penalties or interest accrue, unless contested in
good faith with an adequate reserve for payment.
(c) Continue the conduct of its business; maintain its
corporate existence; maintain all rights, licenses and franchises; and
comply with all applicable laws and regulations.
(d) Maintain its property in good working order and condition
and make all needful and proper repairs, replacements, additions and
improvements thereto.
(e) Deliver to NCBC:
(1) Within ninety (90) days after the end of each
fiscal year, a statement of Borrower's financial condition as
at the end of such fiscal year and a statement of earnings and
retained earnings of Borrower for such fiscal year, with
comparative figures for the preceding fiscal year, prepared,
if NCBC so requests, on a consolidating and consolidated basis
to include any Affiliated Corporation, certified without
qualification by independent certified public accountants
acceptable to NCBC.
(2) Within twenty-five (25) days after the end of
each fiscal month, a statement of Borrower's financial
condition and an operating statement and statement of earnings
-6-
and retained earnings of Borrower for such month, in each case
with comparative figures for the same month in the preceding
fiscal year, prepared on the same basis as the most recent
annual statement provided pursuant to clause (1) above
(excluding the presentation of footnotes therein), certified
by an officer of Borrower.
(3) Within twenty-five (25) days after the end of
each month, an aging of Borrower's accounts receivable as at
the end of such month.
(4) Within twenty-five (25) days after the end of
each month, an aging of Borrower's accounts payable as at the
end of such month.
(5) From time to time, any and all receivables,
schedules, collection reports, equipment schedules, copies of
invoices to account debtors and shipment documents and
delivery receipts for goods sold, and other material, reports,
records or information required by NCBC.
(f) Permit any officer, employee, attorney or accountant for
NCBC to audit, review, make extracts from, or copy any and all
corporate and financial books, records and properties of Borrower at
all times during ordinary business hours, to send and discuss with
account debtors and other obligors requests for verification of amounts
owed to Borrower, and to discuss the affairs of Borrower with any of
its directors, officers, employees, or agents.
(g) Maintain property, liability, business interruption,
xxxxxxx'x compensation and other forms of insurance in reasonable
amounts designated at any time or from time to time by NCBC.
(h) At all times maintain the book net worth of Borrower at
amounts in excess of $1,900,000.00 and maintain Borrower's tangible net
worth (excluding all intangible assets designated by NCBC) at amounts
in excess of $1,400,000.00.
(i) Notify NCBC promptly of (i) any disputes or claims by
customers of Borrower; (ii) any goods returned to or recovered by
Borrower; (iii) any change in the persons constituting the officers and
directors of Borrower; and (iv) the occurrence of any breach, default
or event of default by or attributable to Borrower under this Agreement
or any of the Security Documents.
5. Negative Covenants. Borrower covenants and agrees that it will not,
except with the prior written approval of NCBC:
(a) Become or remain liable in any manner in respect of any
indebtedness or contractual liability (including, without limitation,
notes, bonds, debentures, loans, guaranties, obligations of
partnerships, and pension liabilities, in each case whether or not
contingent and whether or not subordinated), except:
-7-
(1) Indebtedness arising under this Agreement;
(2) Unsecured indebtedness, other than for money
borrowed or for the purchase of a capital asset, incurred in
the ordinary course of its business, which becomes due and
must be fully satisfied within twelve months after the date on
which it is incurred;
(3) Unsecured indebtedness, in an amount not
exceeding Twenty-five Thousand Dollars ($25,000.00) at any one
time outstanding, which is fully subordinated in right of
payment to all indebtedness owed to NCBC pursuant to a
subordination agreement accepted or approved in writing by
NCBC;
(4) Indebtedness arising out of the lease or purchase
of goods constituting equipment and either unsecured or
secured only by a purchase money security interest securing
purchase money indebtedness, but in any event only if such
equipment is acquired in compliance with Paragraph 5(c);
(5) Presently outstanding unsecured borrowings, if
any.
(6) Secured indebtedness, arising from the purchase
of land, described on Exhibit A hereto, together with
additional secured indebtedness arising from the purchase of
land, as Borrower may from time to time incur; provided
however, in no event shall secured indebtedness arising from
the purchase of land (including the indebtedness listed on
Exhibit A hereto) exceed $2,500,000.00; and provided further,
that all indebtedness marked on Exhibit A as "To be paid off
at Funding" shall be paid off and fully satisfied at the time
of initial funding of the first loan to be made hereunder.
(b) Create, incur or cause to exist any mortgage, security
interest, encumbrance, lien or other charge of any kind upon any of its
property or assets, whether now owned or hereafter acquired, except:
(1) The interests created by the Security Documents;
(2) Liens for taxes or assessments not yet due or
contested in good faith by appropriate proceedings;
(3) A purchase money security interest or lessor's
interest securing indebtedness permitted to be outstanding or
incurred under Paragraph 5(a)(4);
(4) Security interests approved by NCBCI in writing;
and
(5) Other liens, charges and encumbrances incidental
to the conduct of its business or the ownership of its
property which were not incurred in connection with the
borrowing of money or the purchase of property on credit and
which do not in the aggregate materially detract from the
value of its property or materially impair the use thereof in
its business.
-8-
(6) Mortgages, encumbrances, or liens securing
indebtedness permitted under Paragraph 5(a)(6).
(c) Expend or contract to expend, in any one calendar year,
more than Fifty Thousand Dollars ($50,000.00), in the aggregate or more
than Twenty Thousand Dollars ($20,000.00) in any one transaction for
the lease, purchase or other acquisition of any capital asset, or for
the lease of any other asset, whether payable currently or in the
future.
(d) Sell, lease, or otherwise dispose of all or any
substantial part of its property, except as permitted under the
Security Documents; provided however, Borrower may, from time to time,
request from NCBC permission to sell chattel paper consisting of
contracts for deed or mortgages, and if adequate provision is made for
the proceeds of such sale to be applied to Indebtedness arising under
this Agreement, NCBC shall not unreasonably withhold its consent.
(e) Consolidate or merge with any other corporation; or
acquire any business; or acquire stock of any corporation; or enter
into any partnership or joint venture.
(f) Substantially alter the nature of the business in which it
is engaged.
(g) Declare or pay any dividends (except dividends payable
solely in its capital stock), or purchase or redeem any of its capital
stock, or otherwise distribute any property on account of its capital
stock; or enter into any agreement therefor.
(h) Purchase stock or securities of, extend credit to or make
investments in, become liable as surety for, or guarantee or endorse
any obligation of, any person, firm or corporation, except investments
in direct obligations of the United States and commercial bank deposits
and extensions of credit reflected by trade accounts receivable arising
for goods sold by Borrower in the ordinary course of its business.
(i) After notice from NCBC, grant any excessive discount,
credit or allowance to any customer of Borrower or accept any return of
goods sold.
(j) In any manner transfer any property without prior or
present receipt of full and adequate consideration.
(k) Permit more than Five Thousand Dollars ($5,000.00) to be
owing to Borrower by the officers, directors or shareholders of
Borrower or any Affiliated Corporation, or members of their families,
on account of any loan, travel advance, credit sale or other
transaction or event.
-9-
(l) Pay excessive or unreasonable salaries, bonuses,
commissions, consultant fees, or other compensation; or increase the
salary, bonus, commissions, consultant fees or other compensation of
Xxxxxx X. Xxxxxx, or any member of his family, by more than ten percent
(10%) in any one year, either individually or for all such persons in
the aggregate, or pay any such increase from any source other than
profits earned in the year of payment; provided however, NCBC hereby
consents to a salary for Xxxxxx X. Xxxxxx of $100,000 for calendar year
1986.
(m) Permit any breach, default or event of default to occur
under any note, loan agreement, indenture, lease, mortgage, contract
for deed, security agreement or other contractual obligation binding
upon Borrower.
6. Event of Default. Any breach of any representation, warranty, or
agreement of Borrower set forth herein or in any of the Security Documents shall
constitute an Event of Default under the Security Documents.
7. Setoff. Borrower agrees that NCBC may at any time or from time to
time, at its sole discretion and without demand and without notice to anyone,
set off any liability owed to Borrower by NCBC, whether or not due, against any
indebtedness owed to NCBC by Borrower (for loans under this Agreement or for any
other transaction or event), whether or not due. In addition, each bank or other
person holding a participating interest in any loans made to Borrower by NCBC
shall have the right to appropriate or set off any deposit or other liability
then owed by such bank or person to Borrower, whether or not due, and apply the
same to the payment of said participating interest, as fully as if such bank or
person had lent directly to Borrower the amount of such participating interest.
8. Termination by Borrower. So long as NCBC, in its sole discretion, is
willing to make loans to Borrower for ordinary working capital purposes subject
to the availability of collateral deemed eligible by NCBC, Borrower may
terminate this Agreement and (subject to payment and performance of all
outstanding secured obligations) may obtain any release or termination of the
Security Documents to which Borrower is otherwise entitled by law, effective
only on the second or any subsequent anniversary date of this Agreement, and
then only if NCBC receives at least 60 days' prior written notice of Borrower's
intent to terminate this Agreement effective on such anniversary date; provided
however, notwithstanding the foregoing provisions of this Paragraph 8, Borrower
may terminate this Agreement at any time upon payment to NCBC of a prepayment
penalty of Twenty Thousand Dollars ($20,000.00) and satisfaction of all
indebtedness and other obligations of Borrower under this Agreement pursuant to
the next succeeding sentence of this Paragraph 8. Upon any such termination, all
obligations of Borrower under this Agreement and the Security Documents shall
remain in full force and effect until all indebtedness under this Agreement and
all other debts, liabilities and obligations of Borrower secured by the Security
Documents or any other collateral security have been fully paid and satisfied.
9. Reservation of Right to Make Demand. Borrower acknowledges that NCBC
reserves the right to demand immediate payment of any or all loans and the
interest thereon and of all other obligations of Borrower payable on demand,
whether or not Borrower has complied with the terms of this Agreement or the
Security Documents.
-10-
10. Miscellaneous. Borrower agrees that:
(a) Borrower will furnish to NCBC, prior to the first advance,
(i) a certified copy of resolutions of the directors and if required
the shareholders of Borrower, authorizing the execution, delivery and
performance of this Agreement and the Security Documents; (ii) a
certificate of an officer of Borrower confirming, in his personal
capacity, the representations and warranties set forth in paragraph 3;
(iii) a written opinion of Borrower's independent legal counsel,
addressed to NCBC, confirming to the satisfaction of NCBC the
representations and warranties set forth in clauses (a) through (i) of
paragraph 3; and (iv) currently certified copies of the Articles of
Incorporation and Bylaws of Borrower and a Certificate of Good Standing
issued as to Borrower by the Secretary of State of the state of its
incorporation; and (v) all certificates of insurance and insurance
endorsements required under the Security Documents; and (vi) all
collateral schedules, security interest subordination agreements,
searches, abstracts, releases and termination statements which NCBC may
request adequately to assure and confirm the creation, perfection and
priority of the security interests created by the Security Documents.
(b) On demand, Borrower will pay or reimburse NCBC for all
expenses, including all reasonable fees and disbursements of legal
counsel, incurred by NCBC in connection with the preparation,
negotiation, execution, performance or enforcement of this Agreement or
the Security Documents, or any document contemplated thereby, or the
perfection, protection, enforcement or foreclosure of the security
interests created by the Security Documents, or in connection with the
protection or enforcement of the interests and collateral security of
NCBC in any litigation or bankruptcy or insolvency proceeding or the
prosecution or defense of any action or proceeding relating in any way
to the transactions contemplated by this Agreement.
(c) The performance or observance of any promise or condition
set forth in this Agreement may be waived in writing by NCBC, but not
otherwise. No delay in the exercise of any power, right or remedy of
NCBC shall operate as a waiver thereof, nor shall any single or partial
exercise thereof or the exercise of any other power, right or remedy.
(d) NCBC and its participants, if any, are not partners or
joint venturers, and NCBC shall not have any liability or
responsibility for any obligation, act or omission of any of its
participants.
(e) This Agreement shall be binding upon Borrower and its
successors and assigns and shall inure to the benefit of NCBC and its
participants, successors and assigns. This Agreement shall be effective
when executed by Borrower and delivered to NCBC, whether or not this
Agreement is executed by NCBC. All rights and powers specifically
conferred upon NCBC may be transferred or delegated by NCBC to any of
-11-
its participants, successors or assigns. Except to the extent otherwise
required by law, this Agreement and the transaction evidenced hereby
shall be governed by the substantive laws of the State in which this
Agreement is accepted by NCBC. If any provision or application of this
Agreement is held unlawful or unenforceable in any respect, such
illegality or unenforceability shall not affect other provisions or
applications which can be given effect, and this Agreement shall be
construed as if the unlawful or unenforceable provision or application
had never been contained herein or prescribed hereby. All
representations and warranties contained in this Agreement or in any
other agreement between Borrower and NCBC shall survive the execution,
delivery and performance of this Agreement and the creation and payment
of any indebtedness to NCBC. Borrower waives notice of the acceptance
of this Agreement by NCBC.
IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
by the proper officers thereunto duly authorized on the day and year first above
written.
XXXXXX INVESTMENT CORPORATION
/s/ Xxxxxx X. Xxxxxx
----------------------------------------
Its
-----------------------------
Address: 000 - 00xx Xxxxxx Xxxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Accepted at Minneapolis, Minnesota
on November 24, 1986.
NATIONAL CITY BUSINESS CREDIT, INC.
By /s/
-------------------------------------
Its Vice President
-12-
*TO BE PAID OFF AT FUNDING
EXHIBIT A
XXXXXX INVESTMENT CORPORATION
SECURED INDEBTEDNESS
LOANS:
LENDER SECURITY BALANCE
------ -------- -------
Industry Financial Corp. Office Furniture & $ 69,260.55
Equipment
Commercial Credit Corp. Assignment of Contracts $ 73,363.25
Hinckley Office Bldg.
Farmers & Merchants State Mortgages on Land Held $186,538.80
Bank of Hinckley for Sale (73 ,762.32 )*
$112,776.48 Balance
Pine City State Bank Mortgages on Land Held $ 86,201.94
for Sale (18,850.23 )*
$ 67,351.71 Balance
First National Bank of Mortgages on Land Held $169,000.00
Deerwood for Sale (115,000.00 )*
$ 54,000.00 Balance
Marquette Bank of Mpls N.A. Assignment of Contracts 44,536.26
Northeast Office for Deed
Norwest Bank Mpls. N.A. Assignment of Contracts $697,422.62
and Mortgage (259,246.68 )*
$438,175.94 Balance
First American Bank of Mortgage on Land Held 325,000.00
Brainerd for Sale
First Federal Savings & Assignment of Contracts $ 54,020.96
Loan Ass'n of Brainerd for Deed & Xxxxxx Ofc. (14,020.96 )*
Bldg $ 40,000.00 Balance
Peoples National Bank of Mortgage on Land Held $ 40,000.00
Xxxx for Sale
American National Bank of Mortgage on Brainerd $ 54,421.57
Brainerd Office Building
Lakeland State Bank of Mortgage on Land Held $ 61,133.12
Pequot Lakes for Sale
