LOAN AGREEMENT
THIS AGREEMENT made as of the 19th day of November, 1999.
BETWEEN:
XXXXXX X. XXXXX, of 00000 Xxxxx Xxxx, Xxxxxxx, Xxxxxxxx, XXX
00000
(the "Borrower")
AND:
TRIMARK OIL & GAS LTD., a corporation duly continued
under the laws of Yukon Territory, having an address
at Xxxxx 0000, 0000 Xxxx Xxxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxx Xxxxxxxx X0X 0X0
(the "Lender")
WHEREAS:
A. The Borrower is an employee of the Lender or one of its
affiliates;
B. The Borrower has represented to the Lender that:
(a) The Borrower wishes to purchase land ("Land") in Bakersfield
California upon which a house ("Building") is or will be
built;
(b) The purchase price for the Land and Building will not exceed
US$600,000;
(c) The Borrower will borrow US$300,000 for the purchase of the
Land and Building from a financial institution which will take
a first mortgage against the Land and Building; and
(d) The Borrower wishes to borrow US$125,000 (the "Loan") from the
Lender which will be used for the purchase price of the Land
and Building;
C. The Lender has determined that it is in the best interests to
make the Loan to the Borrower for the purpose of purchasing the Land and
Building;
D. The parties have agreed to enter into this Agreement in order
to set forth the terms and conditions pertaining to the Loan;
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NOW THEREFORE in consideration of the premises and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the Borrower, it is agreed as follows:
1. INTERPRETATION
1.1 In this Agreement, unless the context otherwise requires, the
following terms and expressions shall have the following meanings:
(a) "Date of Advance" means the date the Lender advances the
proceeds of the Loan to the Borrower pursuant to paragraph
2.1;
(b) "Event of Default" means an event of default defined in
paragraph 7.1;
(c) "Interest Rate" means 5.00% per annum compounded monthly not
in advance;
(d) "Lender's Security" means the security documents referred to
in paragraph 5;
(e) "Loan" shall have the meaning ascribed to it in Recital B
hereof;
(f) "Maturity Date" means the date on which any outstanding
balance of the Loan and interest accrued thereon is payable in
full by the Borrower, being the earlier of:
(i) the date the Lender has declared the Loan to be
payable pursuant to paragraph 7.2(b); and
(ii) the date which is 2 years from the Date of Advance;
(g) "Promissory Note" means the promissory note in the form
attached as Schedule "A"; and
(h) "Property" means Land and Building.
2. LOAN
2.1 Subject to the provisions hereof, the Lender agrees to loan
US$125,000 to the Borrower for the purpose of purchasing the Property from a
third party. The proceeds of the Loan will be advanced in one lump sum two
business days prior to the closing date for the purchase of the Property. The
Borrower will give the Lender five business days advance notice of the closing
date for the purchase of the Property.
2.2 The Borrower acknowledges that the advance of the Loan will be
made subject to the terms and conditions of this Agreement.
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3. REPAYMENT
3.1 The Loan and all unpaid interest accrued thereon pursuant to
paragraph 4 hereof shall be due and payable on the Maturity Date.
3.2 The Borrower may prepay any portion of the Loan outstanding
from time to time without notice or penalty.
3.3 All payments by the Borrower to the Lender shall be paid at
par to the Lender at Suite 1305, 0000 Xxxx Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxx
Xxxxxxxx X0X 0X0, or such other place as the Lender may specify in writing from
time to time.
4. INTEREST
4.1 The Borrower shall pay to the Lender on the last day of each
month interest on the Loan at the Interest Rate, calculated daily from the Date
of Advance.
4.2 The Loan will bear interest at the Interest Rate both before
and after maturity, default or judgment.
5. SECURITY
5.1 As general and continuing security for the due payment of the
Loan and any other sums owing by the Borrower to the Lender hereunder, the
Borrower shall:
(a) execute and deliver to the Lender on the Date of Advance a
promissory note in the form set out in Schedule "A" hereto,
made payable to the Lender;
(b) provide a mortgage on the Property in favour of the Lender at
such time as the Property is purchased by the Borrower which
mortgage will rank in priority to all other mortgages or
charges except mortgages in favour of a financial institution
who has advanced funds for the purchase of the Property; and
(c) execute and deliver to the Lender any other documents
reasonably required by the Company from time to time in
respect of the Loan in accordance with the provisions herein.
6. USE OF LOAN
6.1 The Borrower covenants and agrees with the Lender to:
(a) apply all of the proceeds of the Loan to the purchase of the
Property; and
(b) remain the beneficial owner of the Property during the term of
the Loan.
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7. EVENTS OF DEFAULT AND REMEDIES
7.1 EVENTS OF DEFAULT: Any one or more of the following events
shall constitute an Event of Default (whether any such Event of Default shall be
voluntary or involuntary or be effected by operation of law or pursuant to or in
compliance with any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(a) the failure by the Borrower to make any payment of interest on
the Loan on its due date;
(b) the failure by the Borrower to make any payment of principal
of the Loan on its due date;
(c) the failure by the Borrower to perform or observe any of the
other covenants, conditions or agreements to be performed or
observed by the Borrower hereunder which such failure shall
continue unremedied for a period of 5 business days after
written notice thereof by the Lender to the Borrower;
(d) the default by the Borrower under any of the Lender's
Security;
(e) the making of any representation or warranty by the Borrower
herein or in any document or certificate furnished the Lender
in connection herewith or pursuant hereto which proves at any
time to be materially incorrect, as of the date made;
(f) 12 months after the date of the death of the Borrower;
(g) a legal determination of mental incapacity of the Borrower;
(h) the 30th day after the date that the Borrower ceases to be
employed by the Lender or any of its affiliates;
(i) the making by the Borrower of a proposal or general assignment
for the benefit of its creditors or other acknowledgement of
the Borrower's insolvency;
(j) the appointment of a trustee in bankruptcy of the Borrower;
and
(k) the default by the Borrower under the Loan Agreement dated
November 19, 1999 between the Borrower and Hilton Petroleum
Ltd.
7.2 REMEDIES UPON DEFAULT: Upon the occurrence of any Event of
Default and at any time thereafter, provided that the Borrower has not therefor
remedied all outstanding
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Events of Default, the Lender may, in its discretion, by notice to the Borrower,
declare this Loan Agreement to be in default. At any time thereafter, while the
Borrower shall not have remedied all outstanding Events of Default, the Lender,
at its discretion and subject to compliance with any mandatory requirements of
applicable law then in effect, may:
(a) terminate any of its obligations hereunder;
(b) declare the then outstanding principal and interest on the
Loan to be immediately due and payable and such moneys and
liabilities shall forthwith become due and payable without
presentment, demand, protest or other notice of any kind to
the Borrower, all of which are hereby expressly waived; and
(c) exercise any or all of its remedies under any or all of the
Lender's Security.
7.3 COSTS: In the event of a default, the Borrower will pay all
costs incurred by the Lender in enforcing and collecting upon this Agreement,
which costs will be deducted from the proceeds realized under the Lender's
Security.
8. PRESENTMENT
8.1 To the extent permitted by applicable law, the Borrower hereby
waives presentment, demand, notice of dishonour, notice of protest, notice of
non-payment and any other notice required by law to be given to the Borrower in
connection with the default or enforcement of this Agreement or any security
agreement relating to this agreement, and the Borrower consents to:
(a) any delays, extensions, renewals or other modifications of
this Agreement;
(b) the waiver of any term of this Agreement; and
(c) the release of any security given by the Borrower in respect
of the Borrower's obligations under this Agreement, whether by
the Lender or any other person, and the Borrower agrees that
no such action or failure to act by the Lender or any other
person shall affect or impair the obligations of the Borrower,
or be construed as being a waiver by the Lender or that other
person of its rights under the Agreement.
9. NOTICES
(a) IF TO THE BORROWER:
Xxxxxx X. Xxxxx
00000 Xxxxx Xxxx
Xxxxxxx, Xxxxxxxx
XXX 00000
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Facsimile: (000) 000-0000
(b) IF TO THE LENDER:
Trimark Oil & Gas Ltd.
Xxxxx 0000, 0000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx
X0X 0X0
ATTENTION: PRESIDENT
Facsimile: (000) 000-0000
Any notice, direction or instrument given shall:
(a) if delivered be deemed to have been given or made at the time
of delivery;
(b) if mailed by registered mail and properly addressed be deemed
to have been given or made on the third day following the day
on which it was so mailed provided that should there be at the
time of mailing or between the time of mailing and the actual
receipt of the notice a mail strike, slowdown, or other labour
dispute which might affect the delivery of that notice by the
mails then the notice shall be only effective if actually
delivered; and
(c) if sent by facsimile, telegraph, telex, telecommunication
device, or other similar form of communication be deemed to
have been given or made on the day following the day on which
it was sent.
Any party may give written notice of change of address in the
same manner in which event notice shall thereafter be given at that changed
address.
10. MISCELLANEOUS
10.1 ASSIGNABILITY BY LENDER: The Borrower acknowledges and agrees
that the Lender may assign all or any portion of its rights, obligations and
benefits under this Agreement and the Lender's Security as the Lender sees fit.
The Borrower will execute such assurances and conveyances as may be reasonably
required by the Lender in order to give effect to such assignment, including
executing additional Lender's Security which replace or are to be substituted
for existing Lender's Security to facilitate assignment thereof by the Lender.
10.2 ASSIGNABILITY OF BORROWER: This Agreement will not be
assignable by the Borrower without the written consent of the Lender first had
and obtained.
10.3 ENUREMENT: This Agreement shall enure to the benefit of and be
binding upon the parties hereto and their respective heirs, executors,
administrators, successors and permitted assigns.
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10.4 JURISDICTION: The Borrower hereby irrevocably agrees that any
legal action or proceedings against it with respect to this Agreement or any of
the Lender's Security may be brought to the Courts of the Province of British
Columbia and, by execution and delivery of this Agreement, the Borrower hereby
irrevocably submits to such jurisdiction.
10.5 GOVERNING LAW: This Agreement and any of the Lender's Security
and the rights and obligations of the parties hereto and thereto shall be
governed by and be construed in accordance with the laws of the Province of
British Columbia.
10.6 FURTHER ASSURANCES: As and so often as the Lender may require,
the Borrower shall execute and deliver to the Lender, at the expense of the
Borrower, such further and other assurances and conveyances as may be necessary
to properly carry out the intention of this Agreement.
10.7 AMENDMENTS: Neither this Agreement nor any provision hereof
may be amended, waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against whom enforcement of the
amendment, waiver, discharge or termination is sought.
10.8 TIME OF ESSENCE: Time is expressly declared and stipulated to
be of the essence of this Agreement in respect of all payments to be made
hereunder and all covenants and agreements to be performed and fulfilled. Any
extension of time hereunder shall not be deemed to be or to operate in law as a
waiver on the part of the Lender that time is to be of the essence of this
Agreement.
10.9 ENTIRE AGREEMENT: This Agreement and the other agreements
referred to herein embody the entire agreement and understanding between the
parties hereto and supercede all prior agreements and undertakings whether oral
or written relative to the subject matter hereof.
10.10 SUBJECT TO REGULATORY ACCEPTANCE: This Agreement is subject
to acceptance by the Vancouver Stock Exchange.
IN WITNESS WHEREOF the parties hereto have executed this
Agreement as of the day and year first above written.
SIGNED, SEALED AND DELIVERED by )
XXXXXX X. XXXXX in the presence of: )
)
)
---------------------------------------- )
Witness )
)
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---------------------------------------- )
Name )
) ---------------------------
) XXXXXX X. XXXXX
---------------------------------------- )
Address )
)
)
---------------------------------------- )
Occupation )
)
)
The Corporate Seal of TRIMARK OIL & GAS )
LTD. was hereunto affixed in the presence )
of: )
)
)
---------------------------------------- ) c/s
Authorized Signatory )
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SCHEDULE "A"
US$125,000 _____________, 1999
VANCOUVER, B.C.
PROMISSORY NOTE
FOR VALUE RECEIVED, the undersigned promises to pay on ____________, 2001 to the
order of TRIMARK OIL & GAS LTD. (the "Lender") the sum of Xxx Xxxxxxx
Xxxxxx-Xxxx Xxxxxxxx Xxxxxx Xxxxxx Dollars (US$125,000), or such other amount as
may be owing from time to time by the undersigned to the Lender (the "Principal
Amount"), together with interest thereon at the rate hereinafter provided.
Interest on the unpaid balance of the Principal Amount shall be paid at the
Interest Rate by the undersigned to the Lender on the last day of each month
calculated daily from the date hereof. As used herein, "Interest Rate" means
5.00% per annum, compounded monthly not in advance.
Upon the making of any repayment on the account of the Principal Amount, an
entry shall be made on the grid attached as Schedule "A" hereto and such entry
shall show the amount of the repayment, plus the resulting outstanding balance.
Absent manifest error, the amount shown as being the outstanding balance of
Principal Amount on such grid shall constitute conclusive evidence of the
balance of the Principal Amount outstanding from time to time.
Extension of time of payment of all or any part of the amount owing hereunder at
any time or times or failure of the holder hereof to enforce any of its rights
or remedies hereunder or under any instrument securing this note or any releases
or surrender of property shall not release any party hereof and shall not
constitute a waiver of the rights of the holder hereof to enforce such rights
and remedies thereafter.
The undersigned and each endorser hereof waives demand and presentment for
payment, notice of dishonour, notice of non-payment, protest and notice of
protest of this promissory note.
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The obligations of the undersigned under this Promissory Note are subject to the
terms and conditions of a Loan Agreement made as of the 19th day of November,
1999 between the undersigned and the Lender.
IN WITNESS WHEREOF the undersigned has executed this Promissory Note on the date
first above written.
----------------------------------
XXXXXX X. XXXXX
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SCHEDULE "A"
GRID SHOWING OUTSTANDING PRINCIPAL AMOUNT ON
THE PROMISSORY NOTE DATED ____________, 1999 MADE BY
XXXXXX X. XXXXX
IN FAVOUR OF TRIMARK OIL & GAS LTD.
(All amounts shown are in US$)
================================================================================
INITIALS OF OFFICER
DATE OF AMOUNT OF AMOUNT OF OUTSTANDING OF TRIMARK OIL &
ADVANCE ADVANCE REPAYMENT BALANCE GAS LTD.
OR REPAYMENT
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Opening $125,000 $125,000
balance
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