Note Modification Agreement
Exhibit 10.16
U.S. Global Investors, Inc. |
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March 31, 2011, Quarterly Report on Form 10-Q
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Page 23 of 29 | |
This agreement is dated as of March 25, 2011 (the “Agreement Date”), by and between U.S.
GLOBAL INVESTORS, INC. (the “Borrower”) and JPMorgan Chase Bank, N.A. (together with its
successors and assigns, the “Bank”). The provisions of this agreement are effective on the date
that this agreement has been executed by all of the signers and delivered to the Bank (the
“Effective Date”).
WHEREAS, the Borrower executed a Line of Credit Note dated as of February 26, 2009 in the original
principal amount of One Million and 00/100 Dollars ($1,000,000.00), (as same may have been amended
or modified from time to time, the “Note”) as evidence of an extension of credit from the Bank to
the Borrower, which Note has at all times been, and is now, continuously and without interruption
outstanding in favor of the Bank; and,
WHEREAS, the Borrower has requested and the Bank has agreed that the Note be modified to the
limited extent as hereinafter set forth in this agreement;
NOW THEREFORE, in mutual consideration of the agreements contained herein and for other good and
valuable consideration, the parties agree as follows:
1. ACCURACY OF RECITALS. The Borrower acknowledges the accuracy of the Recitals stated above.
2. DEFINITIONS. Capitalized terms used in this agreement shall have the same meanings as in the
Note, unless otherwise defined in this agreement.
3. MODIFICATION OF NOTE.
3.1 From and after the Effective Date, the provision in the Note captioned “Promise to Pay” is
hereby amended as follows: The date on which the entire balance of unpaid principal plus accrued
interest shall be due and payable immediately is hereby changed from May 31, 2011 to May 31, 2012.
3.2 Each of the Related Documents is modified to provide that it shall be a default or an
event of default thereunder if the Borrower shall fail to comply with any of the covenants of the
Borrower herein or if any representation or warranty by the Borrower herein or by any guarantor in
any Related Documents is materially incomplete, incorrect, or misleading as of the date hereof. As
used in this agreement, the “Related Documents” shall include the Note and all applications for
letters of credit, loan agreements, credit agreements, reimbursement agreements, security
agreements, mortgages, deeds of trust, pledge agreements, assignments, guaranties, or any other
instrument or document executed in connection with the Note or in connection with any other
obligations of the Borrower to the Bank.
3.3 Each reference in the Related Documents to any of the Related Documents shall be a
reference to such document as modified by this agreement.
4. RATIFICATION OF RELATED DOCUMENTS AND COLLATERAL. The Related Documents are ratified and
reaffirmed by the Borrower and shall remain in full force and effect as they may be modified by
this agreement. All property described as security in the Related Documents shall remain as
security for the Note, as modified by this agreement, and the Liabilities under the other Related
Documents.
5. BORROWER REPRESENTATIONS AND WARRANTIES. The Borrower represents and warrants to the Bank that
each of the representations and warranties made in the Note and the other Related Documents and
each of the following representations and warranties are and will remain, true and correct until
the later of maturity or the date on which all Liabilities evidenced by the Note are paid in full:
5.1 No default, event of default or event that would constitute a default or event of default
but for the giving of notice, the lapse of time or both, has occurred and is continuing under any
provision of the Note, as modified by this agreement, or any other Related Document.
5.2 No event has occurred which may in any one case or in the aggregate materially and
adversely affect the financial condition, properties, business, affairs, prospects or operations of
the Borrower or any guarantor or any subsidiary of the Borrower.
U.S. Global Investors, Inc. |
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March 31, 2011, Quarterly Report on Form 10-Q
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Page 24 of 29 | |
5.3 The Borrower has no defenses or counterclaims, offsets or adverse claims, demands or
actions of any kind, personal or otherwise, that it could assert with respect to the Note or any
other Liabilities.
5.4 The Note, as modified by this agreement, and the other Related Documents are the legal,
valid, and binding obligations of the Borrower and the other parties, enforceable against the
Borrower and other parties in accordance with their terms, except as may be limited by bankruptcy,
insolvency or other laws affecting the enforcement of creditors’ rights generally and by general
principles of equity.
5.5 The Borrower, other than any Borrower who is a natural person, is validly existing under
the laws of the State of its formation or organization. The Borrower has the requisite power and
authority to execute and deliver this agreement and to perform the obligations described in the
Related Documents as modified herein. The execution and delivery of this agreement and the
performance of the obligations described in the Related Documents as modified herein have been duly
authorized by all requisite action by or on behalf of the Borrower. This agreement has been duly
executed and delivered by or on behalf of the Borrower.
6. BORROWER COVENANTS. The Borrower covenants with the Bank:
6.1 The Borrower shall execute, deliver, and provide to the Bank such additional agreements,
documents, and instruments as reasonably required by the Bank to effectuate the intent of this
agreement.
6.2 The Borrower fully, finally, and forever releases and discharges the Bank, its successors,
and assigns and their respective directors, officers, employees, agents, and representatives (each
a “Bank Party”) from any and all causes of action, claims, debts, demands, and liabilities, of
whatever kind or nature, in law or equity, of the Borrower, whether now known or unknown to the
Borrower, (i) in respect of the loan evidenced by the Note and the Related Documents, or of the
actions or omissions of any Bank Party in any manner related to the loan evidenced by the Note or
the Related Documents and (ii) arising from events occurring prior to the date of this agreement
(“Claims”); provided, however, that the foregoing RELEASE SHALL INCLUDE ALL CLAIMS ARISING OUT OF
THE NEGLIGENCE OF ANY BANK PARTY, but not the gross negligence or willful misconduct of any Bank
Party.
6.3 To the extent not prohibited by applicable law, the Borrower shall pay to the Bank:
6.3.1 All the internal and external costs and expenses incurred (or charged by
internal allocation) by the Bank in connection with this agreement (including, without
limitation, inside and outside attorneys, appraisal, appraisal review, processing, title,
filing, and recording costs, expenses, and fees).
7. EXECUTION AND DELIVERY OF AGREEMENT BY THE BANK. The Bank shall not be bound by this agreement
until (i) the Bank has executed this agreement and (ii) the Borrower performed all of the
obligations of the Borrower under this agreement to be performed contemporaneously with the
execution and delivery of this agreement.
8. INTEGRATION, ENTIRE AGREEMENT, CHANGE, DISCHARGE, TERMINATION, OR WAIVER. The Note, as modified
by this agreement, and the other Related Documents contain the complete understanding and agreement
of the Borrower and the Bank in respect of any Liabilities evidenced by the Note and supersede all
prior understandings, and negotiations. If any one or more of the obligations of the Borrower under
this agreement or the Note, as modified by this Agreement, is invalid, illegal or unenforceable in
any jurisdiction, the validity, legality and enforceability of the remaining obligations of the
Borrower shall not in any way be affected or impaired, and the invalidity, illegality or
unenforceability in one jurisdiction shall not affect the validity, legality or enforceability of
the obligations of the Borrower under this agreement, the Note as modified by this agreement and
the other Related Documents in any other jurisdiction. No provision of the Note, as modified by
this agreement, or any other Related Documents may be changed, discharged, supplemented,
terminated, or waived except in a writing signed by the party against whom it is being enforced.
9. GOVERNING LAW AND VENUE. This agreement shall be governed by and construed in accordance with
the laws of the State of Texas (without giving effect to its laws of conflicts). The Borrower
agrees that any legal action or proceeding with respect to any of its obligations under the Note or
this agreement may be brought by the Bank in any state or federal court located in the State of
Texas, as the Bank in its sole discretion may elect. By the execution and delivery of this
agreement, the Borrower submits to and accepts, for itself and in respect of its property,
generally and unconditionally, the non-exclusive jurisdiction of those courts. The Borrower waives
any claim that the State of Texas is not a convenient forum or the proper venue for any such suit,
action or proceeding. This agreement binds the Borrower and its successors, and benefits the Bank,
its successors and assigns. The Borrower shall not, however, have the right to assign the
Borrower’s rights under this agreement or any interest therein, without the prior written consent
of the Bank.
U.S. Global Investors, Inc. |
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March 31, 2011, Quarterly Report on Form 10-Q
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Page 25 of 29 | |
10. COUNTERPART EXECUTION. This agreement may be executed in multiple counterparts, each of which,
when so executed, shall be deemed an original, but all such counterparts, taken together, shall
constitute one and the same agreement.
11. NOT A NOVATION. This agreement is a modification only and not a novation. In addition to all
amounts hereafter due under the Note, as modified by this agreement, and the other Related
Documents, all accrued interest evidenced by the Note being modified by this agreement and all
accrued amounts due and payable under the Related Documents shall continue to be due and payable
until paid. Except for the modification(s) set forth in this agreement, the Note, the other Related
Documents and all the terms and conditions thereof, shall be and remain in full force and effect
with the changes herein deemed to be incorporated therein. This agreement is to be considered
attached to the Note and made a part thereof. This agreement shall not release or affect the
liability of any guarantor, surety or endorser of the Note or release any owner of collateral
securing the Note. The validity, priority and enforceability of the Note shall not be impaired
hereby. References to the Related Documents and to other agreements shall not affect or impair the
absolute and unconditional obligation of the Borrower to pay the principal and interest on the Note
when due. The Bank reserves all rights against all parties to the Note and the other Related
Documents.
12. TIME IS OF THE ESSENCE. Time is of the essence under this agreement and in the performance of
every term, covenant and obligation contained herein.
THIS AGREEMENT AND THE OTHER RELATED DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
| Address: | 0000 Xxxxxxxxx Xxxx Xxx Xxxxxxx, XX 00000 |
Borrower:
U.S. GLOBAL INVESTORS, INC.
BANK’S ACCEPTANCE
The foregoing agreement is hereby agreed to and acknowledged.
Bank:
JPMorgan Chase Bank, N.A.
