EXHIBIT 10.3
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5
LOAN AGREEMENT
BETWEEN
MISSISSIPPI BUSINESS FINANCE CORPORATION
AND
XXXXXXX DURA-VENT COMPANY, INC.
DATED AS OF MAY 1, 1998
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
Section 1.1. Definitions 2
Section 1.2. Accounting Terms 14
ARTICLE II
REPRESENTATIONS
Section 2.1. Representations of the Issuer 14
Section 2.2. Representations of Company 15
Section 2.3 Benefits Under the Act 17
ARTICLE III
COMPLETION OF PROJECT; ISSUANCE OF BONDS
Section 3.1. Completion of Project; Best Efforts 19
Section 3.2. Issuance of Bonds 20
Section 3.3. Loan; Disposition of Bond Proceeds 20
Section 3.4. Requisition for Project Funds 20
Section 3.5. Revisions to Plans and Specifications 20
Section 3.6 Notice of Borrowing and Rate Request 21
Section 3.7. Certificate of Completion 21
Section 3.8. Completion of Project if Bond Proceeds
Insufficient; Surplus Proceeds 21
Section 3.9. Default by Contractors 21
Section 3.10. Investment of Project Fund 22
ARTICLE IV
SECURITY; LOAN PAYMENTS; OTHER OBLIGATIONS
Section 4.1. Note/Guaranties 22
Section 4.2. Loan Payments 22
Section 4.3. Obligation to Make Payments Absolute 23
Section 4.4. Sole Possession of Project by the Company 23
Section 4.5. Maintenance of Project 24
Section 4.6. Taxes and Assessments; Tax Indemnity 24
Section 4.7. Operation of Project 24
Section 4.8. Payment of Expenses 24
Section 4.9. Payments Continue Upon Destruction of Project 25
Section 4.10. Payment of Initial Administrative Fee 25
Section 4.11. Release and Indemnification of the Issuer 25
Section 4.12. Insurance 26
Section 4.13. Application of Insurance Proceeds 26
Section 4.14. Condemnation 27
ARTICLE V
SPECIAL COVENANTS
Section 5.1. No Warranty as to Suitability of
Project by the Issuer 28
Section 5.2. Continuation of Existence of Company 28
Section 5.3. Covenant by the Company to Leave Project
Free of Other Liens or Encumbrances 28
Section 5.4. Agreement to Cooperate 28
Section 5.5. Qualification in Mississippi 29
Section 5.6. Title Covenants 29
Section 5.7. Maintenance 29
Section 5.8. Environmental Law Compliance 29
Section 5.9. Financial Reporting 29
Section 5.10. Maintenance of Books and Records; Inspection 30
Section 5.11. Affirmative Covenants 30
Section 5.12. Negative Covenants 31
ARTICLE VI
ASSIGNMENT, LEASE AND SALE OF PROJECT
Section 6.1. Disposal of Project and Assets by Company 31
ARTICLE VII
EVENTS OF DEFAULT AND REMEDIES
Section 7.1. Default 33
Section 7.2. Remedies Upon Default 33
Section 7.3. No Remedy Exclusive 34
Section 7.4. Payment of Fees and Expenses 34
Section 7.5. Effect of Waiver 34
ARTICLE VIII
PREPAYMENT OF LOAN
Section 8.1. Obligations to Accelerate Loan Payments 34
ARTICLE IX
MISCELLANEOUS
Section 9.1. Notices 35
Section 9.2. Parties Interested 36
Section 9.3. Amendment to Agreement 37
Section 9.4. Counterparts 37
Section 9.5. Severability of Invalid Provisions 37
Section 9.6. Governing Law 37
Section 9.7. Tax Exemptions and Credits 37
Section 9.8. No Oral Argument 38
EXHIBIT A BUILDING DESCRIPTION
EXHIBIT B THE PROJECT SITE OWNED BY THE COMPANY
EXHIBIT C EQUIPMENT
EXHIBIT D PROMISSORY NOTE
THIS LOAN AGREEMENT, dated as of May 1, 1998, between Mississippi
Business Finance Corporation, a public corporation of the State of
Mississippi (the "Issuer") and Xxxxxxx Dura-Vent Company, a California
corporation (the "Company"),
W I T N E S S E T H:
WHEREAS, the Issuer is authorized by the provisions of Title 57,
Chapter 10, Articles 7 and 11, of the Mississippi Code of 1972, as amended
and supplemented (the "Act"), to, among other things, provide and finance
economic development projects to eligible companies in the State;
WHEREAS, the Issuer has determined that the Company is an "eligible
company" as defined by the Act in need of assistance to permanently
finance the Cost (as hereinafter defined) of the Project (as hereinafter
defined);
WHEREAS, the Issuer is authorized pursuant to the Act to issue its
revenue bonds and to lend the proceeds thereof to enable eligible
companies to borrow to finance the Cost of said projects;
WHEREAS, the Company has requested the Issuer to issue its revenue
bonds and to lend the proceeds from the sale thereof to the Company to
finance a portion of the Cost of the Project (as hereinafter defined);
WHEREAS, the Issuer has, by due corporate action, authorized the
issuance, from time to time, of its Mississippi Business Finance
Corporation Taxable Industrial Development Revenue Bonds, Series 1998,
(Xxxxxxx Dura-Vent Company, Inc. Project) (the "Bonds") pursuant to the
Act in the aggregate principal amount of $3,000,000 in order to loan the
proceeds thereof to the Company (the "Loan") to finance a portion of the
Project, pursuant to a contractual arrangement whereby the amount of Loan
Payments (as hereinafter defined) to be made to the Issuer by the Company
shall be sufficient to pay the principal of, premium, if any, and interest
on such Bonds secured by such Loan Payments as and when the same shall
become due and payable; and
WHEREAS, the Bonds are to be issued pursuant to an Indenture (as
hereinafter defined) to provide monies for such Loan; and the Company will
execute a Note (as hereinafter defined) pursuant to the Indenture to
evidence and secure its obligations to repay said Loan.
NOW, THEREFORE, THIS AGREEMENT WITNESSETH:
That the parties hereto, intending to be legally bound hereby and in
consideration of the mutual covenants hereinafter contained, do hereby
agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. DEFINITIONS. The terms set forth below shall have the
following meanings in this Loan Agreement, unless the context clearly
otherwise requires. Except where the context otherwise requires, words
importing the singular number shall include the plural number and vice
versa. Capitalized terms used and not defined herein shall have the
meanings ascribed to them in the Indenture.
ACT:
"Act" shall mean Title 57, Chapter 10, Articles 7 and 11, of the
Mississippi Code of 1972, as amended and supplemented.
ADMINISTRATION EXPENSES:
"Administration Expenses" shall mean the reasonable and necessary
expenses incurred by the Issuer pursuant to this Agreement or the
Indenture, including the Initial Administrative Fee, and the compensation
and expenses paid to or incurred by the Trustee or any Paying Agent under
the Indenture.
AFFILIATE:
"Affiliate" shall mean any Person which, directly or indirectly, is
in control of, is controlled by, or is under common control with, the
Company. For purposes of this definition, control of a Person shall mean
the power, directly or indirectly:
(a) to vote more than 50% of the securities having ordinary
voting power for the election of directors or other
managers of such Person, or
(b) to direct or cause the direction of the management and
policies of such Person whether by contract or otherwise.
AGREEMENT:
"Agreement" shall mean this Loan Agreement as amended or supplemented
from time to time in accordance with the terms hereof.
AUTHORIZED COMPANY REPRESENTATIVE:
"Authorized Company Representative" shall mean any person or persons
from time to time designated to act on behalf of the Company by a written
certificate, signed on behalf of the Company by its President or one of
its Vice Presidents or other duly authorized Person and its Secretary or
its Treasurer or other duly authorized Person and furnished to the Issuer
and the Trustee, containing the specimen signature of each such person.
BANK:
"Bank" shall mean Union Bank of California, N.A., a national banking
association with offices located in Oakland, California.
BANK ADJUSTED TREASURIES RATE:
"Bank Adjusted Treasuries Rate" shall mean the per annum rate of
interest based on the percentage yield of U.S. Treasury Securities, plus a
margin, set by the Bank, in its discretion, related to the general cost of
corporate borrowing for a term comparable to the term of Loan plus an
amount determined by the Bank, in its good faith judgment, equal to the
Bank's costs, including the costs, if any, of reserve requirements and
Federal Deposit Insurance Corporation assessments which would be incurred
by or imposed upon the Bank if the Loan were made directly from the Bank
to the Company.
BANK LOAN AGREEMENT:
"Bank Loan Agreement" shall mean that Amended and Restated Loan
Agreement dated as of June 1, 1998, by and between Xxxxxxx and the Bank
(which Bank Loan Agreement amends and restates that certain loan agreement
dated January 14, 1997 between Xxxxxxx and the Bank) as the same may be
amended, modified, replaced or superceded from time to time hereafter.
BASE INTEREST RATE
"Base Interest Rate" shall mean a rate of interest based on either
the Bank Adjusted Treasuries Rate or the LIBOR Rate.
BASE RATE MATURITY DATE:
"Base Rate Maturity Date" shall mean the last day of the Interest
Period with respect to principal outstanding under a Base Interest Rate
Loan. (Undefined)
BANK REFERENCE RATE:
"Bank Reference Rate" shall mean the rate of interest announced by
the Bank from time to time at its corporate headquarters as its Reference
Rate. The effective date of any change in the Bank's Reference Rate shall
be the date of the public announcement of such change. The Reference Rate
is an index rate determined by the Bank from time to time as a means of
pricing certain extensions of credit and is neither directly tied to any
external rate of interest or index nor necessarily the lowest rate of
interest charged by the Bank at any given time.
BOND COUNSEL:
"Bond Counsel" shall mean Xxxxxxx Xxxxxx, P.A., Jackson, Mississippi,
or an attorney-at-law or a firm of attorneys, designated by the Issuer, of
nationally recognized standing in matters pertaining to bonds issued by
states and their political subdivisions, duly admitted to the practice of
law before the highest court of any state of the United States of America.
BOND COUNSEL'S OPINION:
"Bond Counsel's Opinion" shall mean an opinion signed by Bond Counsel
and satisfactory to the Issuer, the Trustee, and the Purchaser.
BOND FUND:
"Bond Fund" shall mean the fund established pursuant to Section 6.1
of the Indenture.
BOND PURCHASE AGREEMENT:
"Bond Purchase Agreement" shall mean the Bond Purchase Contract dated
as of May 1, 1998, among the Issuer, the Company and the Purchaser.
BONDHOLDER:
"Bondholder" or "holder of the Bonds" or "holder" shall mean the
Registered Owner(s) of any fully registered Bond.
BOND REGISTER AND BOND REGISTRAR:
"Bond Register" and "Bond Registrar" shall have the respective
meanings specified in Section 2.9 of the Indenture.
BONDS:
"Bonds" or "Bond" shall mean the Issuer's $3,000,000 aggregate
principal amount of Taxable Industrial Development Revenue Bonds, Series
1998, (Xxxxxxx Dura-Vent Company, Inc. Project), dated as of May 1, 1998,
issued under the Indenture and any Bonds thereafter authenticated and
delivered in lieu of or in substitution for such bonds, pursuant to the
provisions of the Indenture.
BUILDINGS:
"Building" or "Buildings" shall mean the construction of the
building located on the Project Site, as described in Exhibit A to this
Agreement, and all additions, modifications and improvements thereto, as
they may at any time exist.
BUSINESS DAY:
"Business Day" shall mean a day which is not a Saturday or Sunday on
which Bank is open for business in the State of California, and, with
respect to the rate of interest based on the LIBOR Rate, on which dealings
in U.S. dollar deposits outside of the United States may be carried on by
Bank.
COMPANY:
"Company" shall mean Xxxxxxx Dura-Vent Company, Inc., a California
corporation, or any person or entity which is the surviving, resulting or
transferee person in any merger, consolidation or transfer of assets
permitted under Section 5.2 of this Agreement and shall also mean, unless
the context otherwise requires, and any assignee of this Agreement as
permitted by Section 6.1 of this Agreement.
COMPLETION DATE:
"Completion Date" shall mean, with respect to the Bonds, the date of
completion of the Project, the date of completion of a Project, as that
date shall be certified pursuant to Section 5.3 of the Indenture.
COST:
"Cost" or "Cost of the Project" shall mean and be deemed to include
to the extent permitted by the Act, incurred after October 15, 1997 (a)
obligations incurred for labor, Equipment and other expenses paid to
contractors, builders and materialmen in connection with the construction,
installation and equipping of the Project and improvements thereto
including, but not limited to, improvements to the Project Site; (b) the
cost of contract or performance bonds or of other bonds and of insurance
of all kinds that may be required or necessary prior to or during the
course of construction of the Project; (c) all costs of architectural and
engineering services, including the expenses of the Issuer and the Company
for test borings, surveys, test and pilot operations, estimates, plans and
specifications and preliminary investigations therefor, and for
supervising construction, as well as for the performance of all other
duties required by or consequent upon the proper completion of the
Project; (d) compensation and expenses of the Issuer and the Trustee,
legal, accounting, financial and printing expenses, fees and all other
expenses incurred in connection with the issuance of the Bonds, which are
not otherwise provided for under the terms of this Agreement; (e) all
other costs which the Issuer or the Company shall be required to pay under
the terms of any contract or contracts for the acquisition (by purchase,
lease or otherwise), construction, installation and equipping of the
Project; (f) any sums required to reimburse the Issuer or the Company for
advances made by either of them for any of the above items, or for any
other costs incurred and for work done by any of them, which are properly
chargeable to the Project; (g) Administration Expenses; and (h) any other
expenses or fees of the Issuer or the Trustee, which in the opinion of the
Issuer or the Trustee, are related to the Project or the Bonds, including
but not limited to, commitment and legal fees and the costs, fees and
expenses in connection with the initial issuance and sale of the Bonds.
DEBT SERVICE:
"Debt Service" shall mean interest expenses plus prior period current
portion of long term debt, including subordinated debt payments.
EQUIPMENT:
"Equipment" shall mean those items of machinery, equipment, fixtures
and other tangible personal property, which have been or are to be
acquired and installed in the Buildings or elsewhere at or on the Project
Site with the proceeds of the Bonds, if any, and which are generally
described in Exhibit C to this Agreement as the same may be changed from
time to time and any item of machinery, equipment, fixtures and other
tangible personal property which may be acquired and installed in the
Buildings or elsewhere at or on the Project Site in substitution thereof
or in addition thereto pursuant to the provisions of this Agreement, and
any renewals and replacements of any of the foregoing. At such time as the
Project is completed, a complete detailed list of Equipment and other
items of personalty acquired with the proceeds of the Bonds can be found
in the records of the Project Fund maintained by the Trustee.
EVENT(S) OF DEFAULT:
"Event(s) of Default" shall mean any Event(s) of Default specified in
Section 7.1 of this Agreement.
GOVERNMENTAL AUTHORITY:
"Governmental Authority" means any federal, state, local, foreign or
other governmental or administrative body, instrumentality, department or
agency or any court, tribunal, administrative hearing body, arbitration
panel, commission, or other similar dispute-resolving panel or body.
GUARANTORS:
"Guarantors" shall mean Xxxxxxx and Xxxxxxx Strong Tie Company, Inc.,
a California corporation.
GUARANTY:
"Guaranty" shall mean either of the continuing guaranties from the
Guarantors to the Bank under which the Guarantors guaranteed the
obligations of the Company under this Loan Agreement. Guaranties shall
mean both such guaranties.
HAZARDOUS MATERIALS:
"Hazardous Materials" shall mean all materials defined as hazardous
wastes or substances under any local, state or federal environmental laws,
rules or regulations, and petroleum, petroleum products, oil and asbestos.
INDENTURE:
"Indenture" shall mean the Indenture dated as of May 1, 1998, between
the Issuer and the Trustee, as the same may be amended and supplemented
from time to time.
INITIAL ADMINISTRATIVE FEE:
"Initial Administrative Fee" shall mean the initial fee of the Issuer
with respect to the Bonds in the amount of $10,000 which fee is required
to be paid by the Company to the Issuer pursuant to this Loan Agreement.
INTEREST PERIOD:
Interest Period shall mean (i) with respect to funds bearing interest
at a rate based on the Bank Adjusted Treasuries Rate, any period of not
less than 30 nor more than 270 days, or (ii) with respect to funds bearing
interest at a rate based on the LIBOR Rate, any calendar period of one,
three, six, nine or twelve months. In determining an Interest Period, a
month means a period that starts on one Business Day in a month and ends
on and includes the day preceding the numerically corresponding day in the
next month. For any month in which there is no such numerically
corresponding day, then as to that month, such day shall be deemed to be
the last calendar day of such month. Any Interest Period which would
otherwise end on a non-Business Day shall end on the next succeeding
Business Day unless that is the first day of a month, in which event such
Interest Period shall end on the next preceding Business Day.
INVESTMENT SECURITIES:
"Investment Securities" shall mean, only to the extent permitted by
State law, any of the following unless the Company has determined that the
same are not at the time legal investments of the Company's monies:
(a) savings accounts and certificates of deposit issued by a
commercial bank or savings and loan association incorporated under the
laws of the United States of America or any state thereof or the District
of Columbia having a capital stock and surplus of more than $50,000,000,
including the Trustee, or which are fully collateralized by investments of
the type described in (b) below or are rated either A-1 or A-2 by Standard
& Poor's Corporation or P-1 or P-2 by Xxxxx'x Investors Service, Inc.;
(b) bonds, notes and other evidences of indebtedness of the United
States of America or the State and any other security unconditionally
guaranteed as to the payment of principal and interest by the United
States of America or any agency thereof;
(c) repurchase agreements involving the purchase and resale of
investments described in (b) above; provided, that (i) the purchase price
of any such agreement shall at no time exceed the fair market value of the
investments underlying the same, (ii) each such agreement shall provide
for the payment of cash or deposit of additional investments at least
monthly so that the sum of the fair market value of investments and the
amount of cash underlying the same shall remain at least equal to the
purchase price thereof, (iii) the Trustee shall take physical possession
of such investments or the Trustee shall be named as the record owner of
such investments in the records of a Federal Reserve Bank, in each case no
later than the time the purchase price therefor is paid by the Trustee,
(iv) the other party to such repurchase agreement shall be a commercial
bank or savings and loan association incorporated under the laws of the
United States or any state thereof or the District of Columbia or a
securities firm registered under the Securities Exchange Act of 1934, in
either case having combined capital and surplus of at least $50,000,000
including the Trustee, and (v) the repurchase obligations are at the
demand of the Trustee or have a maturity of less than one year;
(d) any money market fund rated "AAA" by Xxxxx'x Investors Service,
Inc. comprised of the investments of the type described in paragraph (b);
(e) any other investment or investment agreement as the Registered
Owner(s) of not less than fifty-one percent (51%) in the aggregate
principal amount of the Bonds then Outstanding may approve.
ISSUER:
"Issuer" shall mean the Mississippi Business Finance Corporation,
constituting a public body corporate and a political subdivision of the
State,its successors and assigns, and any public corporation resulting
from or surviving any consolidation or merger to which it or its
successors may be a party.
LIBOR RATE:
"LIBOR Rate" shall mean a per annum rate of interest (rounded upward,
if necessary, to the nearest 1/100 of 1%) at which dollar deposits, in
immediately available funds and in lawful money of the United States would
be offered to Bank, outside of the United States, for a term coinciding
with the Interest Period selected by the Company and for an amount equal
to the amount of principal covered by the Company's interest rate
selection, plus Bank's costs, including the cost, if any, of reserve
requirements.
LIEN:
Lien shall mean any mortgage, deed of trust, pledge, security
interest, hypothecation, assignment, deposit arrangement, encumbrance
securing indebtedness (other than liens for taxes not delinquent)
(statutory or other), or preference, priority, or other security agreement
or preferential arrangement, charge, or encumbrance securing indebtedness
(other than liens for taxes not delinquent) of any kind or nature
whatsoever (including, without limitation, any conditional sale or other
title retention agreement, any financing lease having substantially the
same economic effect as any of the foregoing, and the filing of any
financing statement under the Uniform Commercial Code or comparable law of
any jurisdiction to evidence any of the foregoing).
LOAN:
"Loan" means the loan made by the Issuer to the Company from the
proceeds of the issuance of the Bonds.
LOAN AGREEMENT:
"Loan Agreement" shall mean this Loan Agreement as amended or
supplemented from time to time in accordance with the terms hereof.
LOAN DOCUMENTS:
"Loan Documents" shall mean the Loan Agreement, the Indenture, the
Bond Purchase Agreement, the Note, the Bond, the Assignment of the Loan
Agreement, the Guaranties and the Assignment of the Note, and any and all
promissory notes executed by the Company in favor of the Issuer and all
other security agreements, documents, instruments, guarantees,
certificates and agreements executed and/or delivered by the Company, or
the Guarantor in connection with this Loan Agreement.
LOAN PAYMENTS:
"Loan Payments" shall mean the payments required to be made by the
Company pursuant to Section 4.2 hereof.
MBFC:
"MBFC" shall mean Mississippi Business Finance Corporation.
NOTE:
"Note" shall mean the promissory note of the Company issued by the
Company to the Issuer in accordance with Section 4.1 hereof, the form of
which is attached hereto as Exhibit D.
OUTSTANDING:
"Outstanding," when used with reference to Bonds, shall mean, at any
date as of which the amount of outstanding Bonds is to be determined, the
aggregate of all Bonds authorized, issued, authenticated and delivered
under the Indenture except:
(a) Bonds cancelled or surrendered to the Trustee for cancellation
pursuant to Section 2.12 of the Indenture prior to such date;
(b) Bonds in lieu of or in substitution for which other Bonds shall
have been authenticated and delivered pursuant to the Indenture unless
proof satisfactory to the Trustee and the Company is presented that any
such Bond is held by a bona fide holder in due course.
In determining whether holders of a requisite aggregate principal
amount of Bonds outstanding have concurred in any request, demand,
authorization, direction, notice, consent or waiver under the Indenture,
Bonds which are owned by the Company or the Issuer shall be disregarded
and deemed not to be outstanding for the purpose of any such
determination; provided, however, that for the purpose of determining
whether the Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only Bonds
which the Trustee knows to be so owned shall be so disregarded.
PERMITTED ENCUMBRANCES:
"Permitted Encumbrances" shall mean and include:
(a) any lien or charge incident to construction or maintenance other
than those then payable and filed of record unless such are being
contested as permitted by Section 4.6 of this Agreement;
(b) the lien of taxes and assessments which are not delinquent;
(c) the lien of taxes and assessments which are delinquent but the
validity of which is being contested as permitted by Section 4.6 of this
Agreement;
(d) any liens created under this Agreement, the Indenture, the Note
and the Security Agreement;
(e) easements, exceptions or reservations for the purpose of
pipelines, telephone lines, telegraph lines, power lines and substations,
roads, streets, alleys, highways, railroad purposes, drainage and sewerage
purposes, dikes, canals, laterals, ditches, the removal of oil, gas, coal
or other minerals, and other like purposes, or for the joint or common use
of real property, facilities and equipment, which, in the reasonable
opinion of the Issuer and the Purchaser do not in the aggregate materially
impair the value or the use of such property for the purposes for which it
is or may reasonably be expected to be held;
(f) rights reserved to or vested in any municipality or governmental
or other public authority to control or regulate or use in any manner any
portion of the Project which in the aggregate do not materially impair the
use of the Project for the purposes for which, in the reasonable opinion
of the Company, the Issuer and the Purchaser, it is or may reasonably be
expected to be held;
(g) any obligations or duties affecting any portion of the Project
Site to any municipality or governmental or other public authority with
respect to any right, power, franchise, grant, license or permit;
(h) present or future valid zoning laws and ordinances, provided the
same do not, in the opinion of the Company, the Issuer and the Purchaser,
prohibit the carrying on of the business of the Company at the Project
Site;
(i) the rights of the Issuer and the Trustee under this Agreement,
the Indenture and the Note;
(j) any lien on the Project or any part thereof created or that may
be created pursuant to this Agreement from the Company to the Issuer, as
assigned to the Trustee pursuant to the Indenture including the Security
Agreement;
(k) such other encumbrances as the Purchaser may approve; and
(l) any lien or encumbrance permitted under the Bank Loan Agreement
or by the Bank in writing.
PERSON OR PERSON:
"Person" or "person" shall mean an individual, partnership,
corporation, business trust, joint stock company, trust, unincorporated
association, joint venture, governmental authority, or other entity of
whatever nature.
PLANS AND SPECIFICATIONS:
"Plans and Specifications" shall, to the extent applicable, mean the
plans and specifications prepared for the Project, certified by an
Authorized Company Representative, as the same may be implemented,
detailed and revised from time to time.
PROJECT:
"Project" shall mean an expansion to the building on the Project Site
and acquisition and installation of the Equipment financed with the
proceeds of the Loan, and as the same may become more detailed from time
to time, including any repair, replacement or modification thereof and
substitutions therefor and additions thereto and excluding deletions
therefrom, including personal property installed in accordance with
Section 4.5 of the Agreement, to be used for the purpose of facilitating
the relocation and expansion of an existing manufacturing facility for the
manufacturing processing, assembling and distribution of building material
products and other permissible products under the Act.
PROJECT FUND:
"Project Fund" shall mean the fund created under Section 5.1 of the
Indenture.
PROJECT SITE:
"Project Site" shall mean the real property described in Exhibit B
attached hereto on which the Buildings and the Equipment acquired and
installed with the proceeds of the Bonds are or will be situated, which
property is owned by the Company.
PURCHASER:
"Purchaser" shall mean the Bank.
REDEMPTION PRICE:
"Redemption Price" shall mean the principal of and interest on the
Bonds to be redeemed at par, without premium, and all other amounts due
and owing in respect to the Bonds.
REGISTERED OWNER(S):
"Registered Owner(s)" shall mean the Person or Persons in whose name
or names the particular registered Bond or Bonds shall be registered on
the Bond Register.
REVENUES:
"Revenues" shall mean all payments, receipts and revenues payable by
the Company to the Issuer under this Loan Agreement (except payment of
Administration Expenses and indemnification payments pursuant to Sections
4.2 and 4.11, respectively, of this Loan Agreement) and any other
payments, receipts and revenues derived by the Issuer from the Company
under this Loan Agreement.
XXXXXXX:
"Xxxxxxx" shall mean Xxxxxxx Manufacturing Co., Inc., a California
corporation.
STATE:
"State" shall mean the State of Mississippi.
TRUSTEE:
"Trustee" shall have the meaning set forth in the Indenture.
SECTION 1.2. ACCOUNTING TERMS. All accounting terms not
specifically defined or otherwise specified herein shall have the meanings
generally attributed to such terms under generally accepted accounting
principles, as in effect from time to time, consistently applied, except
that for purposes of calculating any ratios hereunder, consolidated items
shall include those of each Affiliate whether or not such Affiliate would
otherwise be consolidated under such accounting principles.
ARTICLE II
REPRESENTATIONS
SECTION 2.1. REPRESENTATIONS OF THE ISSUER. The Issuer makes the
following representations as the basis for the undertakings on the part of
the Company herein contained:
(a) The Issuer is a public corporation of the State and is
authorized pursuant to the provisions of the Act to enter into the
transactions contemplated by this Agreement.
(b) The Issuer has full power and authority to enter into the
transactions contemplated by this Agreement and to carry out its
obligations hereunder.
(c) The Issuer is not in default under any provisions of the laws of
the State material to the performance of its obligations under this
Agreement.
(d) The Issuer has been duly authorized to execute and deliver this
Agreement and by proper corporate action has duly authorized the execution
and delivery hereof and as to the Issuer, this Agreement is valid and
legally binding and enforceable in accordance with its terms, except to
the extent that the enforceability thereof may be limited (1) by
bankruptcy, reorganization, or similar laws limiting the enforceability of
creditors' rights generally or (2) by the availability of any
discretionary equitable remedies.
(e) The Loan for the Cost of the Project by the Company, as provided
by this Agreement, will further the purposes of the Act, to wit: to
induce the location or expansion of manufacturing facilities within the
State in order to advance the public purposes of relieving unemployment.
SECTION 2.2. REPRESENTATIONS OF COMPANY. The Company makes the
following representations as the basis for the issuance by the Issuer of
the Bonds and the undertakings on the part of the Issuer herein
contained:
(a) The Company is a corporation duly incorporated under the laws of
the State of California is in good standing and is duly qualified to
transact business in the State, has power to enter into the Loan
Documents, and by proper corporate action has duly authorized the
execution and delivery of the Loan Documents, and as to the Company, the
Loan Documents are valid and legally binding and enforceable in accordance
with their respective terms, except to the extent the enforceability
thereof may be limited (i) by bankruptcy, reorganization, or similar laws
limiting the enforceability of creditors' rights generally or (ii) by the
availability of any discretionary equitable remedies.
(b) The Company is not in violation of any provision of its
certificate of incorporation, its bylaws or any laws in any manner
material to its ability to perform its obligations under the Loan
Documents, has power to enter into the Loan Documents and has duly
authorized the execution and delivery of the Loan Documents by proper
corporate action.
(c) The Project consists of (1) the acquisition of certain real
property and the construction of a Building as more particularly described
in Exhibit A to this Agreement and in the Plans and Specifications, and
(2) the acquisition and installation of Equipment as more particularly
described in Exhibit C to this Agreement.
(d) The estimated Cost of the Project exceeds the principal amount
of the Loan.
(e) The Company is engaged in the building products industry and
other permissible products under the Act.
(f) That as a result of the construction of the Project, the Company
will provide gainful employment opportunities to the residents of the
State. The Company has been advised by the Issuer that it is an eligible
company as defined in the Act.
(g) Neither the execution and delivery of the Loan Documents, the
consummation of the transactions contemplated hereby or thereby, nor the
fulfillment of or compliance with the terms and conditions of the Loan
Documents, conflicts with or results in a breach of the terms, conditions
or provisions of any corporate restriction or any agreement or instrument
to which the Company is now a party or by which it, or any of its
property, is bound, or constitutes a default under any of the foregoing,
or results in the creation or imposition of any impermissible Lien, charge
or encumbrance whatsoever upon any of the property or assets of the
Company under the terms of any instrument or agreement.
(h) Each of the Guarantors is duly organized and existing under the
laws of the jurisdiction of its incorporation, has full and adequate
corporate power to carry on its business as now conducted and is duly
licensed or qualified to do business in all jurisdictions where failure to
be so licensed or qualified would have a material adverse effect on the
Guarantors' business or financial condition.
(i) Neither the Company nor either of the Guarantors is a party to
any agreement, note, indenture or other instrument binding upon it which
contains a provision prohibiting the creation of a Lien upon any of its
property or assets, other than this Agreement, the Bank Loan Agreement,
the loan agreement currently in effect between Xxxxxxx and Xxxxx Fargo
Bank, N.A., and the other Loan Documents.
(j) The Company and each of its Affiliates has filed or caused to be
filed all tax returns that to its knowledge are required to be filed
(except for returns not yet due), and has paid all taxes shown to be due
and payable on said returns and all other taxes, impositions, assessments,
fees or other charges imposed on it by governmental authority, agency or
instrumentality, prior to any delinquency with respect thereto (other than
taxes, impositions, assessments, fees, and charges currently being
contested in good faith by appropriate proceedings, for which appropriate
amounts have been reserved).
(k) Neither the business nor the properties of the Company or either
Guarantor are presently affected by any fire, explosion, accident, strike,
lockout or other labor dispute, drought, storm, hail, earthquake, embargo,
act of God, or other casualty (whether nor not covered by insurance)
materially and adversely affecting such business or properties or the
operation of the Company or either Guarantor.
(l) All information furnished by the Company to the Issuer and the
Purchaser for the purpose of approving the Project and the financing of
the Loan through the issuance and sale of the Bonds including, but not
limited to, its application for the Loan is true, accurate and complete in
all material respects as of the date hereof and thereof.
(m) The Loan is not being made to finance any existing debt except
for the repayment of existing debt which qualifies as a Cost of the
Project, or any costs, expenses or other obligations incurred by the
Company or any other Person on behalf of the Company prior to October 15,
1997.
(n) There are no suits or proceedings pending or to the knowledge of
the Company threatened against or affecting the Company, which, if
adversely determined, would have a material adverse effect on the
financial condition or business or operations of the Company, and there
are no proceedings by or before any governmental commission, board, bureau
or other administrative agency pending or to the knowledge of the Company
threatened against or affecting the Company which, if adversely
determined, would have a material adverse effect on the financial
condition or business or operations of the Company.
(o) The Company and each Affiliate is in substantial compliance in
all material respects with all applicable provisions of ERISA.
(p) The Company acknowledges the terms and provisions of the
Indenture and will comply with such terms of the Indenture to the extent
that such terms and provisions are applicable to the Company.
(q) No material advance change has occurred in the financial
condition, operation, business or prospects of the Company and its
Affiliates since March 31, 1998.
SECTION 2.3. BENEFITS UNDER THE ACT. (a) The parties hereto
acknowledge that the Company has been induced to proceed with the
acquisition and construction of the Project in part by the benefits
conferred by the Act. The Issuer hereby agrees that the Company shall be
permitted to take advantage of all of the benefits provided by the Act to
the fullest extent therein set forth subject to the rules and regulations
of the Issuer. The Issuer agrees that it will not take any action to
limit, curtail or otherwise make unavailable to the Company any of the
benefits available under the Act.
(b) With respect to benefits conferred by the Act referenced in (a)
above, the following shall apply:
(1) the maximum benefits accruing in any calendar year with
respect to the income tax credit (other than any credits
which may be carried forward to future years pursuant to
the Act) shall not exceed the payments of the principal of,
premium, if any and interest payments on the Building Bonds
during such year and the fees and expenses of the Trustee
and any other fees and expenses referenced herein.
(2) any benefit claimed or received by the Company for any Cost
shall not be used as a deduction under the laws of the
State of Mississippi in order to determine the taxable
income of the Company.
(3) the Company shall request the Trustee to provide the
Issuer, not later than ninety (90) days after the end of
each calendar year, with a certificate setting forth the
amount of all payments made to the Trustee with respect to
the Bonds whether for principal, premium, interest or the
fees and expenses of the Trustee.
(4) the benefits accruing to the Company under this Section 2.3
shall cease in the event:
(A) a default should occur under this Agreement or the
Indenture; or
(B) the Company should fail to operate the Project for a
period of nine (9) consecutive months following the
initial start up of the Project except for force
majeure, strikes, lockouts, damage, destruction, act
of God or in general, reasons beyond the Company's
reasonable control excepting, however, general
economic conditions.
(5) the Company agrees to comply with the terms and provisions
of the Act in all respects with respect to the benefits
available under the Act.
(6) the benefits or credits available under the Act shall cease
to accrue on the date the principal and interest on the
Bonds are paid in full whether at maturity or by way of
redemption.
(7) the benefits accruing to the Company under this Section 2.3
shall be limited to the annual debt service payments on the
Bonds for qualified Cost of the Project and shall be
reduced by the amount of surplus funds remaining after
completion which shall be used to redeem Bonds as provided
for in Section 3.7 of this Agreement.
(8) the tax credits allowed as a benefit under the Act shall be
further limited so that the credits allowed in any year
shall not exceed eighty percent (80%) of the amount of
taxes due to the State prior to the application of the
credits (as directed in Section 27-7-22.3 of the
Mississippi Code of 1972, as amended). To the extent that
the payments of the principal of, premium, if any, and
interest payments on the Bonds during any year and the fees
and expenses of the Trustee and any other fees and expenses
referenced herein exceed the amount of the tax credit
authorized by Section 27-7-22.3, in any taxable year, such
excess payment may be recouped from excess credits in
succeeding years not to exceed three (3) years following
the date upon which the credit was earned.
(9) the Company will report to the Mississippi Employment
Security Commission ("MESC") its employees as required by
law, and shall annually report to MBFC the average number
of employees reported for each year to the MESC. This
shall be done for each year after the year in which the
Project was induced for financing by the MBFC for so long
as the Bonds are outstanding.
With respect to the benefits that may accrue to the Company under
this Section 2.3, the Company acknowledges and agrees that the Issuer
makes no representation, warranty or covenant regarding the enforceability
of the Company's rights to receive the benefits, the extent that such
benefits may be received nor the term under which the Company may be
entitled to receive the benefits.
ARTICLE III
COMPLETION OF PROJECT; ISSUANCE OF BONDS
SECTION 3.1. COMPLETION OF PROJECT; BEST EFFORTS. The Company will
acquire, construct, install and equip the Project or cause the Project to
be acquired, constructed, installed and equipped in accordance with the
Plans and Specifications and as herein provided, will use its best efforts
to cause the acquisition, construction, installation and equipping thereof
to be completed with all reasonable dispatch, but if for any reason such
acquisition, construction, installation and equipping shall not be
completed there shall be no resulting diminution in or postponement of the
payments required in Section 4.2 hereof to be paid by the Company under
this Agreement and the Note.
Anything in this Agreement notwithstanding, the Issuer shall not be
obligated to complete the acquisition, construction, installation and
equipping of the Project upon acceleration of the payment of the unpaid
portion of the payments due pursuant to this Agreement and the Note, and
the making of all payments in the amount required by and in accordance
with the terms of this Agreement and the Note.
In order to effectuate the purposes of this Agreement, the Company
will make, execute, acknowledge and deliver, or cause to be made,
executed, acknowledged and delivered, all contracts, orders, receipts,
writings and instructions, in the name of the Company or otherwise, with
or to other persons, firms or corporations, and in general do or cause to
be done all such other things as may be requisite or proper for the
construction, installation and equipping of the Project and fulfillment of
the obligations of the Company under this Agreement.
The Company will maintain such records in connection with the cost of
the construction, installation and equipping of the Project as to permit
ready identification thereof which records the Issuer, the Purchaser and
the Trustee shall have the right to inspect upon reasonable notice during
regular business hours.
The Company hereby grants to the Issuer, the Trustee and the
Purchaser the right, privilege and authority to take all actions and to do
all other things necessary to effectuate the purposes of this Agreement.
SECTION 3.2. ISSUANCE OF BONDS. The Issuer, concurrent with or as
soon as practical after the execution of this Agreement, will use its best
efforts to sell, issue and deliver the Bonds to the Purchaser thereof and
deposit the proceeds thereof, from time to time, with the Trustee in
accordance with Sections 5.1 and 6.1 of the Indenture.
SECTION 3.3. LOAN; DISPOSITION OF BOND PROCEEDS. The Issuer, as
issuer of the Bonds, hereby lends from the proceeds of the issuance and
sale of the Bonds, in the principal amount of $3,000,000 to the Company,
which is equal to the original face amount of the Bonds, paid by the
purchaser thereof, for the purposes and in accordance with the terms and
conditions set forth in the Indenture.
SECTION 3.4. REQUISITION FOR PROJECT FUNDS. The Issuer has, in the
Indenture, authorized and directed the Trustee to make payments from the
Project Fund to pay the Cost of the Project, upon receipt by the Trustee,
with a copy to the Purchaser, of (a) original executed requisitions (upon
which both the Issuer and the Trustee may rely conclusively and shall be
protected in relying) signed by an Authorized Company Representative, and
approved by the Purchaser stating with respect to each payment to be made:
(1) the requisition number, (2) the name and address of the Person to whom
payment is due or, in the event such payment is to reimburse the Issuer or
the Company, the name and address of the Person to whom payment previously
has been made (or, in the case of payments to the Bond Fund, instructions
to make such payments to the Bond Fund), (3) the amount to be paid, (4)
that there has been no "Event of Default" under Section 7.1 of this
Agreement by the Company under this Agreement, and (5) that each
obligation, item of cost or expense mentioned therein has been properly
incurred, is a proper charge against the Project Fund and has not been the
basis of any previous withdrawal; and (b) copies of all invoices or
statements from a contractor, vendor or other payee supporting each
requisition for payment from the Project Fund and clearly identifying the
property or service comprising the Cost of the Project to be paid or
reimbursed which shall be maintained by the Trustee.
If any contract provides for retention by the Company of a portion of
the contract price, there shall be paid from the Project Fund only the net
amount remaining after deduction of such portion, until such retainage
becomes due in accordance with the terms of the contract.
SECTION 3.5. PLANS AND SPECIFICATIONS; REVISIONS. Upon request, the
Company shall deposit a completed set of Plans and Specifications with the
Purchaser as soon as such Plans and Specifications are available. The
Company may revise the Plans and Specifications at any time and from time
to time prior to the Completion Date.
SECTION 3.6. RATE REQUESTS. The Loan shall be funded and remain
outstanding pursuant to Section 2.2 of the Indenture. The Bonds shall
bear interest at either of the rates defined as Interest Rate A, Interest
Rate B or Interest Rate C, as defined in the Indenture.
SECTION 3.7. CERTIFICATE OF COMPLETION. When the Project is
completed and ready to be placed in service, the Trustee and the Issuer
shall receive a certificate of an Authorized Company Representative
stating, as applicable, that (a) the construction of the Building has been
completed substantially in accordance with the Plans and Specifications;
(b) the acquisition of the Equipment has been completed substantially in
accordance with the list of Equipment attached hereto as Exhibit C; (c)
the Project complies with all zoning, planning, building and all
regulations of any other governmental entities having jurisdiction over
the Project; and (d) payment, or provision therefor of the Cost of the
Building and the Equipment has been made except for any cost of the
Building and the Equipment not then due and payable or the liability for
payment of which is being contested or disputed by the Company.
Notwithstanding the foregoing, such certificate shall state that it is
given without prejudice to any rights against third parties which exist at
the date thereof or which may subsequently come into being. The Issuer
and the Company agree to cooperate in causing such certificates to be
furnished to the Trustee and the Issuer.
SECTION 3.8. COMPLETION OF PROJECT IF BOND PROCEEDS INSUFFICIENT;
SURPLUS PROCEEDS. If the moneys in the Project Fund available for payment
of the Cost of the Project are not sufficient to pay the Cost of the
Project in full, the Company will complete or cause to be completed the
Project and pay or cause to be paid all of that portion of the Cost of the
Project in excess of the moneys available therefor in the Project Fund.
The Issuer does not make any warranty, either express or implied, that the
moneys which will be paid into the Project Fund will be sufficient to pay
the Cost of the Project. If the Company shall pay any portion of the Cost
of the Project pursuant to the provisions of this Section 3.7, it shall
not be entitled to any reimbursement therefor from the Issuer, the Trustee
or the holders of any of the Bonds, nor shall it be entitled to any
diminution in or postponement of the Loan Payments required in Section 4.2
hereof to be paid by the Company.
If, upon the Completion Date, there shall be any surplus funds
remaining in the Project Fund not reserved to pay for the Cost of the
Project, such funds shall, (a) be deposited in the Bond Fund and used, at
the earliest date permissible under the terms of the Indenture without the
payment of a call premium or penalty, to pay principal on such Bonds
through redemption or retirement; and (b) be invested as provided for in
the Indenture until such time as such surplus funds are expended as
provided for in this Section 3.7.
SECTION 3.9. DEFAULT BY CONTRACTOR. In the event of default of any
supplier, contractor or subcontractor under any contract made by it in
connection with the Project or in the event of a breach of warranty with
respect to any materials, workmanship or performance guaranty, the Company
may proceed, either separately or in conjunction with others, to pursue
such remedies against the supplier, contractor or subcontractor so in
default and against each surety for the performance of such contract as it
may deem advisable. The Company will advise the Issuer, the Purchaser and
the Trustee of the steps it intends to take in connection with any such
default. If the Company shall so notify the Issuer and the Trustee, the
Company may, in its own name or in the name of the Issuer, prosecute any
action or proceeding or take any other action involving any such supplier,
contractor, subcontractor or surety which the Company deems reasonably
necessary, and in such event the Issuer will cooperate fully with the
Company. Any amounts recovered by way of damages, refunds, adjustments or
otherwise in connection with the foregoing prior to the Completion Date
shall be paid into the Project Fund or, if recovered after the Completion
Date and full disposition of the Project Fund, shall be deposited in the
Bond Fund, or in such other manner as the Issuer shall reasonably
determine to be consistent with the Loan Agreement.
SECTION 3.10. INVESTMENT OF PROJECT FUND. Any moneys held as a part
of the Project Fund or any other fund created pursuant to the Indenture
shall, at the facsimile request of an Authorized Company Representative,
confirmed in writing within two (2) Business Days, be invested or
reinvested by the Trustee as provided in Article VII of the Indenture.
ARTICLE IV
SECURITY; LOAN PAYMENTS; OTHER OBLIGATIONS
SECTION 4.1. NOTE/GUARANTIES. Concurrently with the sale and
delivery by the Issuer of the Bonds, in order to secure the obligation of
the Company hereunder, (i) the Company will execute and deliver the Note
substantially in the form attached hereto as Exhibit D which shall be
dated the same date as the date of delivery of the Bonds and (ii) the
Guarantors will execute and deliver the Guaranties.
SECTION 4.2. LOAN PAYMENTS. As and for security for repayment of
the Loan made to Company by the Issuer pursuant to Section 3.3 hereof, the
Company agrees to the assignment of the Loan Documents to the Trustee for
the account of the Issuer and Purchaser. The Company agrees to pay or
cause to be paid to the Trustee a sum equal to the aggregate principal
amount of the Bonds issued under the Indenture, premium, if any, and
interest on the unpaid balance thereof at the rates payable by the Trustee
on such Bonds, in the amounts and on the Payment Dates as follows:
(a) for deposit in the Bond Fund, on the Business Day prior to each
Interest Payment Date, the amount which equals the interest to be paid on
the Bonds on such Interest Payment Date (computed in accordance with
Section 2.2 of the Indenture); provided, however, such deposits of
interest shall not be required to be made into the Bond Fund to the extent
that money on deposit therein is available for such purpose; and
(b) for deposit in the Bond Fund, on the Business Day prior to each
Principal Payment Date on which principal of the Bonds is due, the amount
which equals the sum of (1) the principal of the Bonds which will be due
and payable on such Principal Payment Date, and (2) the amount of the
Redemption Price due and payable on such Principal Payment Date, if any,
provided, however, that such deposits of principal shall not be required
to be made into the Bond Fund to the extent that money on deposit therein
is available for such purpose; provided, however, that if the Bonds shall
theretofore have been deemed to have been paid pursuant to the Indenture
from amounts paid by the Company, but solely to the extent of amounts paid
by the Company, no further payments need be made under subsections (a) and
(b) of this Section provided however that:
(c) notwithstanding the foregoing, during only such periods when all
Outstanding Bonds are registered in the name of the Bank, payments by the
Company under this Section 4.2 shall be made directly to the Bank in
accordance with Section 6.3 of the Indenture.
In the event the Company shall fail to make or cause to be made any
of the payments required in this Section 4.2, the payment so in default
shall continue as an obligation of the Company until the amount in default
shall have been fully paid, and the Company will pay the same with
interest thereon until paid at the rate or rates per annum borne by the
Bonds.
The Company further agrees to pay, when due, to the party to whom
such payment is due, the Administration Expenses, all sums constituting a
Cost of the Project and all other amounts due in respect of the Bonds and
required under the terms and provisions of this Agreement as same shall
have become due and payable.
In addition, in the event the Company is obligated to make payments
which are accelerated hereunder upon the occurrence of certain events, all
as described in Article VII hereof, such payments to be made in an amount
sufficient (a) to redeem at the earliest date permitted under the
Indenture the Bonds to be redeemed at the Redemption Price, (b) to pay any
interest which will become due on such Bonds to such redemption date and
(c) to pay all Administration Expenses accrued and to accrue.
SECTION 4.3. OBLIGATION TO MAKE PAYMENTS ABSOLUTE. It is understood
and agreed that all payments by the Company under this Agreement and the
Note shall be absolute and unconditional and shall not be subject to any
defense (other than payment) or any right of set-off, counterclaim or
recoupment arising out of any breach by the Issuer or the Trustee of any
obligation to the Company, whether hereunder or otherwise, or out of any
indebtedness or liability at any time owing to the Company by the Issuer
or the Trustee.
So long as any Bonds are Outstanding, the Company will pay directly
to the Issuer or the Trustee when due, as the case may be, the amount of
Administration Expenses payable to them respectively not theretofore
provided for which have then accrued and become payable (except as
otherwise provided herein); provided, however, that before any such
payment is due and payable, the Issuer or the Trustee, as the case may be,
shall give notice to the Company, at least fifteen (15) days prior to such
Payment Date, of the amount and nature of such Administration Expenses.
SECTION 4.4 SOLE POSSESSION OF PROJECT BY THE COMPANY. The Company
is entitled to sole and exclusive possession of the Project subject to the
provisions of this Agreement.
SECTION 4.5 MAINTENANCE OF PROJECT. The Company will use its best
efforts to maintain, preserve and keep the Project or cause the Project to
be maintained, preserved and kept, with the appurtenances and every part
and parcel thereof, in good repair, working order and condition and will
from time to time make or cause to be made all necessary and proper
repairs, replacements and renewals.
Subject to Section 6.1 of this Agreement, the Company shall have the
privilege, provided the value of the Project is not materially diminished,
of remodeling the Project or making substitutions, modifications and
improvements to the Project from time to time as it, in its discretion,
may deem to be desirable for its uses and purposes, the cost of which
remodeling, substitutions, modifications and improvements shall be paid by
the Company, and the same shall be included under the terms of this
Agreement as part of the Project.
SECTION 4.6. TAXES AND ASSESSMENTS; TAX INDEMNITY. The Company
shall:
(a) file all tax returns and appropriate schedules thereto that are
required to be filed under applicable law, prior to the date of
delinquency;
(b) pay and discharge all taxes, assessments and governmental
charges or levies imposed upon by the Company, upon its income and profits
or upon any properties belonging to it, prior to the date on which
penalties attach thereto; and
(c) pay all taxes, assessments and governmental charges or levies
that, if unpaid, might become a Lien upon any of its properties; provided,
however, that the Company in good faith may contest any such tax,
assessment, governmental charge or levy described in the foregoing clauses
(b) and (c) so long as appropriate reserves are maintained with respect
thereto. If any tax is or may be imposed by any governmental entity in
respect of sales of the Company's inventory or the payment of compensation
to the Company's employees, or as a result of any other transaction of the
Company, which tax the Issuer is or may be required to withhold or pay,
the Company agrees to indemnify and hold harmless the Issuer in connection
with such taxes (including penalties and interest), and the Company shall
immediately reimburse the Issuer for any such amounts paid by the Issuer.
SECTION 4.7. OPERATION OF PROJECT. The Company agrees that so long
as any of the Bonds are Outstanding it will maintain the Project as an
eligible company in accordance with the Act, unless the Project is sold
pursuant to Section 6.1 hereof.
SECTION 4.8. PAYMENT OF EXPENSES. The Company will pay, or cause to
be paid, in addition to the payments provided for in Sections 4.2 and 4.3
hereof, all of the expenses of operation of the Project, including,
without limitation, the cost of all necessary and proper repairs,
replacements and renewals made pursuant to Section 4.5 hereof and any and
all taxes and assessments payable pursuant to Section 4.6 hereof.
SECTION 4.9. PAYMENTS CONTINUE UPON DESTRUCTION OF PROJECT. It is
understood and agreed that the payments under Section 4.2 hereof and on
the Note and other charges payable hereunder shall continue to be payable
at the time and in the amounts herein specified, whether or not the
Project, or any portion thereof, shall have been condemned or taken by
eminent domain or destroyed, wholly or partially, by fire or other
casualty, and that there shall be no abatement or diminution of any such
payments and other charges by reason thereof.
SECTION 4.10. PAYMENT OF INITIAL ADMINISTRATIVE FEE. Concurrently
with the sale and delivery by the Issuer of the Bonds, the Company shall
pay to the Issuer an Initial Administrative Fee in the amount of $10,000.
SECTION 4.11. RELEASE AND INDEMNIFICATION OF THE ISSUER. The
Company hereby releases the Issuer from, and agrees that the Issuer and
its respective officers, directors, members, employees, attorneys, and
agents shall not be liable for, and agrees to defend, indemnify and hold
the Issuer and its respective officers, directors, members, employees,
attorneys, and agents harmless against:
(a) any liability, cost or expense in the administration of this
Agreement or the Indenture and the obligations imposed on the Issuer
thereby and hereby;
(b) any or all liability or loss, cost or expense, including
reasonable attorneys' fees, resulting from or arising out of any loss or
damage to property or any injury to or death of any person occurring on or
about the Project Site or resulting from any defect in the fixtures,
machinery, equipment or other property located on the Project Site or
arising out of, pertaining to, or having any connection with the Project
or the financing thereof (whether or not arising out of acts, omissions or
negligence of the Company);
(c) any or all liability or loss, cost or expense, including
attorneys' fees, arising out of or in connection with, or pertaining to
the issuance, sale or delivery of the Bonds, including, but not limited
to, liabilities arising under the Securities Act of 1933, the Securities
Exchange Act of 1934 or any applicable state securities laws;
(d) any and all claims, damages, judgments, penalties, costs, and
expenses (including attorneys' fees and court costs now or hereafter
arising from the aforesaid enforcement of this paragraph) arising directly
or indirectly from (i) the activities of the Company and its predecessors
in interest, (ii) third parties with whom it has a contractual
relationship, or (iii) the violation of any environmental protection,
health, or safety law, whether any such claims are asserted by any
Governmental Authority or any other Person which indemnity shall survive
the termination of this Agreement.
The indemnity specified in this Section 4.11 shall not be effective
to relieve the Issuer or its respective officers, directors, members,
employees, attorneys and agents from damages that result from negligence
or intentional misconduct on the part of the Issuer. This indemnification
covenant shall survive the termination of this Agreement with respect to
liability arising out of any event or act occurring prior to such
termination.
The provisions of this Section 4.11 shall also apply in favor of the
Trustee, except to the extent that any liability, loss, cost or expense on
the part of the Trustee results from the Trustee's own willful misconduct
or gross negligence.
SECTION 4.12. INSURANCE. The Company shall maintain insurance with
responsible insurance companies on such of its properties, in such amounts
and against such risks as is customarily maintained by similar business
operating n the same vicinity, specifically to include fire and extended
coverage insurance covering all assets located at the Project Site,
business interruption insurance, workers compensation insurance and
liability insurance, all to be with such companies and in such amounts as
are satisfactory to the Issuer and with respect to insurance on the
collateral referred to in any of the Loan Documents, to contain a mortgage
clause naming the Purchaser and the Trustee as a loss payee or an
additional insured (as applicable) as its interest may appear and
providing for at least thirty (30) days prior notice to the Issuer of any
cancellation thereof. Satisfactory evidence of such insurance will be
supplied to the Purchaser and the Trustee prior to funding under the Loan
and thirty (30) days prior to each policy renewal. Risk of loss or damage
is the Company's to the extent of any deficiency in any effective
insurance coverage.
SECTION 4.13. APPLICATION OF INSURANCE PROCEEDS.
(a) Immediately after the occurrence of any damage or loss to the
Project in excess of $1,000,000 the Company shall notify the Issuer, the
Purchaser and the Trustee as to the nature and extent of such damage or
loss. If the Company shall determine that rebuilding, repairing or
restoring the Project is practicable and desirable, the Company shall
obtain written consent from the Purchaser and upon receiving such approval
the Company shall forthwith proceed with such rebuilding, repairing or
restoring the Project to its former condition and shall notify the Issuer,
the Purchaser and the Trustee upon the completion thereof. If the Company
determines to rebuild, repair or restore the Project, all net proceeds of
such insurance, if any, shall be delivered to the Trustee and all such
funds held by the Trustee for the rebuilding, repairing or restoring of
the Project shall be disbursed by the Trustee in accordance with the
procedures established for making payments from the Project Fund in
Section 5.2 of the Indenture. In the event the Company elects to rebuild,
repair or restore the Project, and the net proceeds of insurance, if any,
will be insufficient to pay in full the costs of rebuilding, repairing or
restoring the Project under this Section, the Company will nonetheless
perform such rebuilding, repairing or restoration. Prior to the
commencement thereof, the Company shall, upon written request of the
Purchaser, pay the deficiency to the Trustee for disbursement. The
Company shall not, by reason of the payment of any such deficiency, be
entitled to any reimbursement from the Trustee and the Purchaser or the
Issuer or any abatement or diminution of payments under this Agreement or
the Note. In the event the Company elects to rebuild, repair or restore
the Project, any insurance proceeds received in respect of such damage or
loss not expended in rebuilding, repairing or restoring the Project shall
be paid to the Company.
(b) If the Company chooses not to rebuild, repair or restore the
Project, the Company shall pay or cause to be paid to the Trustee, acting
for and on behalf of the Issuer, the net proceeds of such insurance, if
any, to be applied to the prepayment of the Loan as provided for in
Article VIII hereof.
(c) Any provisions of this Agreement to the contrary
notwithstanding, the Company shall be entitled to receive, keep and retain
that portion of insurance proceeds received for damages to its own
property other than the Project. The Issuer and the Purchaser shall
cooperate fully with the Company in the handling and the conduct of any
prospective or pending insurance claims with respect to the Project or any
portion thereof.
SECTION 4.14. CONDEMNATION.
(a) In the event that title to or the temporary use of the Project,
or any portion thereof, shall be taken in condemnation or by the exercise
of the power of eminent domain by any governmental body or by any person,
firm or corporation acting under Governmental Authority in excess of
$1,000,000, the Company shall notify the Issuer, the Purchaser and the
Trustee as to the nature and extent of such condemnation or eminent domain
proceedings. If the Company deems it practicable and desirable to replace
or restore that portion of the Project taken in or affected by
condemnation or by the exercise of the power of eminent domain, the
Company shall obtain written consent from the Purchaser and upon receiving
such approval the Company shall forthwith proceed with such replacement or
restoration of the Project to a useful condition and shall notify the
Issuer, the Purchaser and the Trustee upon the completion thereof, and
such replaced or restored property shall become part of the Project
subject to the security interests granted herein. If the Company
determines to proceed with such replacement or restoration, all net
proceeds of such award or awards shall be delivered to the Trustee and all
such funds held by the Trustee for replacement or restoration of the
Project shall be disbursed by the Trustee in accordance with the
procedures established for making payments from the Project Fund in
Section 5.2 of the Indenture. In the event the Company elects to restore
or replace the Project, and the net proceeds of such condemnation award or
awards will be insufficient to pay in full the costs of restoration or
replacement of the portion of the Project taken in or affected by
condemnation or the power of eminent domain, the Company will nonetheless
perform such restoration or replacement. Prior to the commencement
thereof, the Company shall pay the deficiency to the Trustee for
disbursement. The Company shall not, by reason of the payment of any such
deficiency, be entitled to any reimbursement from the Trustee, the
Purchaser or the Issuer or any abatement or diminution of payments under
this Agreement or the Note. In the event the Company elects to restore
or replace the Project, any proceeds received from any award or awards in
respect of the Project or any portion thereof made in such condemnation or
eminent domain proceedings, after payment of all expenses incurred in the
collection thereof and not otherwise used by the Company for the
replacement or restoration by the Company of the portion of the Project
taken in or affected by condemnation or by the exercise of the power of
eminent domain, shall be paid to the Company.
(b) In the event the Company chooses not to replace or restore the
Project, the Company shall pay or cause to be paid to the Issuer the net
proceeds of the condemnation award or awards to be applied to the
prepayment of the Loan as provided for in Article VIII hereof.
(c) Any provisions of this Agreement to the contrary
notwithstanding, the Company shall be entitled to receive, keep and retain
that portion of the proceeds of any condemnation award made for damages to
or taking of its own property other than the Project. The Issuer shall
cooperate fully with the Company in the handling and the conduct of any
prospective or pending condemnation proceedings with respect to the
Project or any portion thereof.
ARTICLE V
SPECIAL COVENANTS
SECTION 5.1. NO WARRANTY AS TO SUITABILITY OF PROJECT BY THE ISSUER.
The Issuer makes no warranty, either express or implied, as to the actual
or designed capacity of the Project, as to the suitability of the Project
for the purposes specified in this Agreement, as to the condition of the
Project, or that the Project will be suitable for the Company's purposes
or needs.
SECTION 5.2. CONTINUATION OF EXISTENCE OF COMPANY. The Company
covenants that it will maintain its existence in its present form, will
obtain, maintain and keep in full force and effect all governmental
approvals, consents, permits and licenses as may be necessary for
continued use of the Project, will not dissolve or otherwise dispose of
all or substantially all its assets and will not consolidate with or merge
into another Person or permit one or more other Persons (other than a
subsidiary) to consolidate with or merge into it without first obtaining
the prior written consent of the Purchaser and the Issuer. If written
approval of the Purchaser and the Issuer is obtained, upon any
consolidation or merger, or any conveyance or transfer of the assets of
the Company substantially as an entirety in accordance with this Section
5.2, the successor Company formed by such consolidation or into which the
Company is merged or to which such conveyance or transfer is made shall
succeed to, and be substituted for, and may exercise every right and power
of, the Company under this Agreement with the same effect as if such
successor Company had been named as the Company herein.
In the event of any such conveyance or transfer, the Company as the
predecessor person may be dissolved, wound up and liquidated (if
applicable) at any time thereafter.
If a consolidation, merger or sale or other transfer is made as
permitted by this Section 5.2, the provisions of this Section 5.2 shall
continue in full force and effect and no further consolidation, merger or
sale or other transfer shall be made except in compliance with the
provisions of this Section 5.2 and Section 6.1 hereof.
SECTION 5.3. COVENANT BY THE COMPANY TO LEAVE ASSETS, INCLUDING THE
PROJECT, FREE OF OTHER LIENS OR ENCUMBRANCES. The Company covenants that
it shall not create or suffer to be created any Lien on its assets,
including, without limitation, the Project or any part thereof, except
Permitted Encumbrances.
SECTION 5.4. AGREEMENT TO COOPERATE. In the event it may be
necessary for the proper performance of this Agreement, or for the
exercise of any rights hereunder, on the part of the Issuer or the Company
that any application or applications for any permit or license or
authorization to do or to perform certain things be made to any
governmental or other agency by the Company or the Issuer, or both, the
Company and the Issuer each agree to execute and prosecute upon the
request of the other such application or applications.
SECTION 5.5. QUALIFICATION IN MISSISSIPPI. Subject to Section 5.2
hereof, the Company warrants that it is and throughout the term of this
Agreement will continue to be duly qualified to do business in the State.
SECTION 5.6. TITLE COVENANTS. The Company covenants that the
Project and, to the extent applicable, each component thereof, including
the Project Site and the Equipment, is free from all Liens except for
Permitted Encumbrances and that the Company has and will maintain
throughout the term of this Agreement a valid fee simple interest in the
Project Site described in Exhibit B attached hereto.
SECTION 5.7. MAINTENANCE. The Company will, if necessary in its
opinion, maintain all of its tangible property used in connection with its
business in good condition and repair and make all necessary replacements
thereof, and preserve and maintain all licenses, trademarks, privileges,
permits, franchises, certificates and the like necessary for the operation
of its business.
SECTION 5.8. ENVIRONMENTAL LAW COMPLIANCE. The conduct of the
Company's and each of the Guarantors' business operations do not and will
not violate any federal laws, rules or ordinances for environmental
protection, regulations of the Environmental Protection Agency and any
applicable local or state law, rule, regulation or rule of common law and
any judicial interpretation thereof relating primarily to the environment
or Hazardous Materials and the Company will not use or permit any other
party to use any Hazardous Materials at any of the Company's places of
business or at any other property owned by the Company except such
materials as are incidental to the Company's normal course of business,
maintenance and repairs and which are handled in compliance with all
applicable environmental laws. On or after (i) an event requiring the
Company to notify the Issuer under Section 5.12(e) hereof, (ii) Issuer
obtains a Lien on additional assets of the Company, or (iii) a default
under any of the Loan Documents, the Company agrees to permit the Issuer,
its agents, contractors and employees to enter and inspect any of the
Company's places of business or any other property of the Company at any
reasonable times upon three (3) days prior notice for the purposes of
conducting an environmental investigation and audit (including taking
physical samples) to insure that the Company is complying with this
covenant and the Company shall reimburse the Issuer on demand for the
costs of any such environmental investigation and audit. The Company
shall provide the Issuer, its agents, contractors, employees and
representatives with access to and copies of any and all data and
documents relating to or dealing with any Hazardous Materials used,
generated, manufactured, stored or disposed of by Company's business
operations within five (5) days of the request therefore.
SECTION 5.9. FINANCIAL REPORTING. The Company shall submit, and
shall cause the Guarantors to submit, financial information to the
Purchaser as required by Section 5(d) of the Bond Purchase Agreement.
SECTION 5.10. MAINTENANCE OF BOOKS AND RECORDS; INSPECTION. The
Company shall maintain its books, accounts and records in accordance with
generally accepted accounting principles and permit the Issuer, the
Purchaser or the Trustee, their officers and employees and any
professionals designated by the Issuer, the Purchaser or the Trustee in
writing, at any time during regular business hours, to visit and inspect
any of its properties (including but not limited to the collateral
security described in the Loan Documents), corporate books and financial
records, and to discuss its accounts, affairs and finances with any
employee, officer, director, or shareholder of the Company. Unless written
notice of another location is given to the Issuer, the Purchaser or the
Trustee, the Company's books and records will be located at Company's
chief executive office set forth above.
SECTION 5.11. AFFIRMATIVE COVENANTS. Until full payment and
performance of all obligations of the Company under the Loan Documents,
the Company agrees to comply with the following covenants, unless the Bank
consents otherwise in writing (and without limiting any requirement of any
other Loan Document):
(a) Within sixty (60) days after the close of each fiscal quarter, a
financial statement, to include a balance sheet, income statement,
statement of cash flow and consolidating schedules for the Company;
(b) Within one hundred twenty (120) days after the close of each
fiscal year, a consolidated financial statement of the Company prepared by
the Company;
(c) Give notice to the Bank and the Trustee of occurrence of any
Event of Default or of any event, condition, or occurrence which, with the
giving of notice or the message of time or both, would constitute an Event
of Default;
(d) Give prompt written notice to Bank of all events of default
under any of the terms or provisions of this Agreement or of any other
agreement, contract, document or instrument entered, or to be entered into
with Bank; and of any litigation which, if decided adversely to the
Company or the Guarantors, would have a material adverse effect on the
Company's or the Guarantors' financial condition; and of any other matter
which has resulted in, or is likely to result in, a material adverse
change in its financial condition or operations;
(e) The Company shall pay promptly to Bank upon demand, reasonable
attorney's fees (including but not limited to the reasonable estimate of
the allocated costs and expenses of in-house legal counsel and legal
staff) and all costs and other expenses paid or incurred by Bank in
collecting, modifying or compromising this Loan Agreement or in enforcing
or exercising its rights or remedies created by, connected with or
provided for in this Loan Agreement or any of the Loan Documents, whether
or not an arbitration, judicial action or other proceedings is commenced.
If such proceeding is commenced, only the prevailing party shall be
entitled to attorneys' fees and court costs;
(f) The Company shall promptly, upon demand by Bank, take such
further action and execute all such additional documents and instruments
in connection with this Loan Agreement as Bank in its reasonable
discretion deems necessary, and promptly supply Bank with such other
information concerning its affairs as Bank may reasonably request from
time to time; and
(g) The Company shall pay or reimburse Bank for all costs, expenses
and fees incurred by Bank in preparing and documenting this Loan Agreement
and the Loan Documents, and all amendments and modifications thereof,
including but not limited to all filing and recording fees, costs of
appraisals, insurance and attorneys' fees, including the reasonable
estimate of the allocated costs and expenses of in-house legal counsel and
legal staff.
SECTION 5.12. NEGATIVE COVENANTS. Until full payment and performance
of all obligations of the Company under the Loan Documents, the Company
will not, without the prior written consent of the Bank (and without limiting
any requirement of any other Loan Documents):
(a) create, assume or suffer to exist any mortgage, pledge, security
interest, encumbrance, or lien on any of its assets, other than Permitted
Encumbrances.
(b) create, incur, assume or permit to exist any indebtedness or
liabilities resulting from borrowings, loans or advances, whether secured
or unsecured, matured or unmatured, liquidated or unliquidated, joint or
several, except (a) the liabilities of Company to Bank; (b) trade debt
incurred by Company in the normal course of its business; or (c) the
existing liabilities of Company disclosed to Bank on its financial
statement referenced in Section 5.1 hereof.
(c) liquidate, dissolve, or enter into any consolidation, merger,
partnership or other combination, nor convey, nor sell, nor lease all or
the greater part of its assets or business; nor permit the dissolution,
merger, consolidation or sale of all or any greater part of the assets of
any of the Company's Affiliates or subsidiaries;
(d) become a guarantor or surety, pledge its credits or properties
in any manner to secure the indebtedness of another excess of $3,000,000
in the aggregate; and
(e) transfer the proceeds of any loan or advance hereunder, or any
other asset of Company to any Affiliate or the Guarantors, unless such
transfer is evidenced by a valid and enforceable instrument or statement
or account.
ARTICLE VI
ASSIGNMENT, LEASE AND SALE OF PROJECT
SECTION 6.1. DISPOSAL OF PROJECT AND ASSETS BY COMPANY.
(a) The Company will not sell, lease or otherwise dispose of or
encumber its interest in the Project, except for Permitted Encumbrances or
transactions permitted pursuant to Section 5.2 hereof and this Section
6.1, without the prior written consent of the Issuer and the Purchaser,
and with notice to the Trustee. Upon prior written consent of the Issuer
and the Purchaser, this Agreement may be assigned in whole or in part, and
the interest of the Company in the Project may be sold or leased as a
whole or in part by the Company, provided, however, that any such
assignee, vendee or lessee shall, in writing, specifically assume the
obligations and affirm in its own capacity the representations, warranties
and covenants made by the Company in this Agreement, subject, however, to
the following conditions:
(1) No sale, assignment or leasing of the Project (other than
pursuant to Section 5.2 hereof), shall relieve the Company from liability
for any of its obligations hereunder, and in the event of any such sale,
assignment or leasing the Company shall continue to remain primarily
liable for the payments specified in Section 4.2 and Section 4.3 hereof
and for performance and observance of the other agreements on its part
herein provided, unless otherwise approved by the Issuer and the
Purchaser, in writing, in which case such vendee, assignee or lessee shall
assume the obligations of the Company hereunder and shall become liable
for the payments specified in Section 4.2 and Section 4.3 hereof and for
performance and observance of the other agreements of the Company herein
provided as to which the Company shall no longer be liable and the Issuer,
the Purchaser and the Trustee shall execute such release.
(2) The Company shall, no later than ten (10) days prior to the
effective date thereof, furnish or cause to be furnished to the Issuer,
the Purchaser and the Trustee a copy of each such proposed sale agreement,
assignment and lease, as the case may be.
(3) The Company shall, ten (10) days after the delivery
thereof, furnish or cause to be furnished to the Issuer, the Purchaser and
the Trustee, a true and complete copy of each such sale agreement,
assignment and lease, as the case may be, and before the execution thereof
furnish the form thereof to the Issuer.
(4) There shall be delivered to the Issuer, the Purchaser and
the Trustee a Bond Counsel's Opinion, addressed to the Issuer and the
Trustee, to the effect that such sale, assignment or leasing is not
prohibited by the Act.
(b) Notwithstanding any of the foregoing, except in the ordinary
course of business the Company may with the prior written consent of the
Purchaser (with notice to the Trustee and the Issuer) from time to time
sell or permit the sale of or lease or otherwise dispose of a portion of
the Equipment or its other assets without complying with the conditions of
Section 6.1(a) hereof if the aggregate fair market value of the Equipment
or other assets so sold, leased or otherwise disposed of does not exceed
$100,000 and if the Company shall certify, in writing, to the Issuer, the
Trustee and the Purchaser that such Equipment or other assets are no
longer needed or are no longer useful in its operation of the Project and
the proceeds thereof shall be applied to the replacement of or
substitution of Equipment or other assets of equal value or utility for
the Equipment or other assets so sold or disposed of, and such Equipment
or other assets purchased in replacement or substitution shall become part
of the Project, or the proceeds shall be paid to the Trustee for deposit
in the Bond Fund.
ARTICLE VII
EVENTS OF DEFAULT AND REMEDIES
SECTION 7.1. DEFAULT. Any of the following events shall constitute
a "default" or "event of default" under this Loan Agreement:
(a) the failure to pay any obligation, liability or indebtedness of
the Company or either of the Guarantors (i) to the Purchaser, or (ii) to
the Issuer or the Trustee under any of the Loan Documents, as and when due
(whether upon demand, at maturity or by acceleration) and such failure is
not cured within ten (10) days thereof;
(b) the failure to pay or perform any other obligation, liability or
indebtedness of the Company to the Purchaser under the Loan Documents or
Xxxxxxx under the Bank Loan Agreement, and such failure to pay a monetary
obligation is not cured within ten (10) days thereof, or the failure to
perform any other obligation is not cured within thirty (30) days
following written notice to the Company by the Purchaser;
(c) any default under any Loan Documents by the Company or the Bank
Loan Agreement by Xxxxxxx, subject to any cure period applicable thereto;
(d) the filing or commencement of a proceeding against the Company
for dissolution or liquidation, or the Company's voluntary or involuntary
termination or dissolution;
(e) insolvency of, business failure of, the appointment of a
custodian, trustee, liquidator or receiver of or for any of the property
of, or an assignment for the benefit of creditors by, or the filing of a
petition under bankruptcy, insolvency, debtor's relief law or for any
adjustment of indebtedness, composition or extension by or against the
Company or either of the Guarantors;
(f) an Event of Default shall have occurred and be continuing under
either of the Guaranties or the Bank Loan Agreement;
(g) the Company shall fail to maintain a net profit from operations,
as determined in accordance to generally accepted accounting principles,
of a positive amount for each fiscal year; or
(h) any representation or warranty made by the Company in any Loan
Documents or otherwise to the Purchaser was untrue or materially
misleading when made.
SECTION 7.2. REMEDIES UPON DEFAULT. Whenever any Event of Default
referred to in Section 7.1 hereof shall have occurred and be continuing,
any one or more of the following remedial steps may be taken.
The Issuer may and upon written request of the Purchaser shall:
(a) declare all amounts due under any of the Loan Documents, at the
option of the Purchaser, to be immediately due and payable, and/or
(b) exercise all other rights, powers and remedies available under
each of the Loan Documents and well as all rights and remedies available
at law or in equity.
SECTION 7.3. NO REMEDY EXCLUSIVE. The failure at any time of the
Issuer, Trustee or Purchaser to exercise any of its options or any other
rights hereunder shall not constitute a waiver thereof, nor shall it be a
bar to the exercise of any of its options or rights at a later date. All
rights and remedies of the Issuer shall be cumulative and may be pursued
singly, successively or together, at the option of the Issuer. The
acceptance by the Issuer of any partial payment shall not constitute a
waiver or any default or of any of Issuer's rights under this Note. No
waiver of any of its rights hereunder and no modification or amendment of
this Agreement or the Note shall be deemed to be made by the Issuer unless
the same will be in writing, duly signed on behalf of the Purchaser; and
each such waiver shall apply only with respect to the specific instance
involved, and shall in no way impair the rights of the Purchaser or the
obligations of the Company to the Bank or the Issuer in any other respect
at any such time.
SECTION 7.4. PAYMENT OF FEES AND EXPENSES. If the Company shall
default under any of the provisions of this Agreement and the Issuer or
the Trustee shall employ attorneys or incur other expenses for the
collection of the Loan payments or to secure possession, or to resell the
Project or for the enforcement of performance or observance of any
obligation or agreement on the part of the Company contained in this
Agreement, the Company will on demand therefor pay the reasonable fees and
expenses of the issuer , the Purchaser or the Trustee and their attorneys
as they are incurred including all fees of counsel including those incurred
for negotiation, trial, appeals of ruling of any lower tribunals,
administrative hearings, bankruptcy and creditors' reorganization
proceedings.
SECTION 7.5. EFFECT OF WAIVER. The Trustee, after having first
received the prior written approval of the Purchaser, may waive any Event
of Default under this Agreement. In the event any agreement contained in
this Agement shall be breached and such breach shall thereafter be waived,
such waiver shall be limited to the particular breach so waived and shall
not be deemed to waive any other breach hereunder.
ARTICLE VIII
PREPAYMENT OF LOAN
SECTION 8.1. OBLIGATIONS TO ACCELERATE LOAN PAYMENTS. In the event
the Company makes provision for payment of all loan payments and any other
amounts payable pursuant to the Loan Documents in accordance with Article
VIII of the Indenture, following written notification thereof to the
Issuer, the Purchaser and the Trustee, the total amount due will be a sum,
payable in cash and/or Government Obligations, sufficient, together with
interest earned on such Government Obligations and other funds held by the
Trustee and available for such purpose, (a) to redeem at the earliest
redemption date or dates provided in the Indenture all Bonds then
outstanding under the Indenture at a Redemption Price equal to the
principal amount thereof, (b) to pay in accordance with the Indenture the
interest which will become due on all such Bonds to the date fixed for
redemption, and (c) to pay all Administration Expenses accrued and to
accrue through the date fixed for redemption. Furthermore, loan payments
and amounts due under the Note shall be accelerated prior to the maturity
of the Bonds (or prior to making provision for payment thereof in
accordance with Article XIV of the Indenture) if the Bonds shall be
subject to redemption pursuant to Sections 2.3 or 2.4, as the case may be,
of the Indenture. In such case, the total amount due shall be the sums
required pursuant to Sections 2.3 or 2.4, as the case may be, of the
Indenture, on the dates required by Sections 2.3 or 2.4, as the case may
be, of the Indenture.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1. NOTICES. All notices, certificates, requests or other
communications hereunder shall be sufficiently given and shall be deemed
given when received by registered or certified mail, return receipt
requested (except as otherwise specified herein), postage prepaid; or when
received by overnight delivery; or when personally delivered; addressed as
follows:
IF TO THE ISSUER:
Mississippi Business Finance Corporation
1306 Xxxxxx Xxxxxxx Building
000 Xxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxxx 00000
Xxxx Xxxxxx Xxx 000
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: Executive Director
Telephone Number: (000) 000-0000
Facsimile Number: (000) 000-0000
IF TO THE TRUSTEE:
Union Bank of California, N.A.
0000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Corporate Trust Department
Telephone Number: (000) 000-0000
Facsimile Number: (000) 000-0000
IF TO THE COMPANY:
Xxxxxxx Manufacturing Co., Inc.
0000 Xxxxxx Xxxx, Xxxxx 000
Post Office Xxx 00000
Xxxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxxxx, Chief Financial Officer
Telephone Number: (000) 000-0000
Facsimile Number: (000) 000-0000
IF TO THE PURCHASER:
Union Bank of California, N.A.
0000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxx
Telephone Number: (000) 000-0000
Facsimile Number: (000) 000-0000
WITH A COPY TO:
Union Bank of California, N.A.
000 Xxxxxxxxxx Xxxxxx - 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Lebbeus S. Case, Jr.
Telephone Number: (000) 000-0000
Facsimile Number: (000) 000-0000
A duplicate copy of each notice, certificate, request or other
communication given hereunder to the Issuer, the Company, the Trustee or
the Purchaser shall also be given to the others. The Company, the Issuer,
the Trustee or the Purchaser and may, by notice given under Section 9.1,
designate any further or different addresses to which subsequent notices,
certificates, requests or other communications shall be sent.
SECTION 9.2. PARTIES INTERESTED. This Agreement shall inure to the
benefit of the Purchaser, the Issuer and the Company and shall be binding
upon the Issuer, the Company and their respective successors and assigns,
subject to the limitation that any obligation or liability of the Issuer
created by or arising out of this Agreement shall not be a general debt of
the Issuer or the State, but shall be payable by the Issuer solely out of
the proceeds derived from this Agreement or from the security interests
granted herein.
No covenant, stipulation, obligation or agreement contained in this
Agreement shall be deemed or construed to be a covenant, stipulation,
obligation or agreement of any present or future member, agent, employee
or official of the Issuer in his individual capacity, and no present or
future member, agent, employee or official of the Issuer shall be liable
personally, for any breach or non-observance or failure to comply with the
above mentioned covenants, stipulations, obligations, or on the Bonds or
be subject to any personal liability or accountability by reason of the
issuance thereof or by reason of the said covenants, stipulations,
obligations or agreements, above mentioned. No present or future member,
agent, employee or official of the Issuer shall incur any personal
liability in acting or proceeding or in not acting or proceeding, in good
faith, reasonably, under the provisions of this Agreement. If in or by or
as a result of the execution of this Agreement or any other document in
connection with this transaction or any other related transaction, the
Issuer or any member, agent, employee or official thereof shall become
obligated in excess of or contrary to the provisions of the statutory
authority granted by the Act, then such excess or contrary obligation
shall not be binding on or enforceable against the Issuer or any present
or future member, agent, employee or official thereof.
SECTION 9.3. AMENDMENT TO AGREEMENT. Except as otherwise provided
in this Agreement, subsequent to the initial issuance of the Bonds and
prior to payment or provision for the payment of such Bonds in full
(including interest and premium, if any, thereon), in accordance with the
provisions of the Indenture, and payment or provisions for the payment of
other obligations incurred by the Issuer to pay the Cost of the Project
including interest, premiums and other charges, if any, thereon, and
payment or provision for the payment of Administration Expenses, this
Agreement may not be amended, changed, modified, altered or terminated
without the prior approval of the Purchaser and the Trustee. No
amendment, change, modification, or alteration of this Agreement shall be
made other than pursuant to a written instrument signed by the Issuer and
the Company and of an Opinion of Bond Counsel to the effect that such
amendment, change, modification or alteration of this Agreement is
authorized or permitted by the provisions of this Agreement.
SECTION 9.4. COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which, when so executed and delivered,
shall be an original; but such counterparts shall together constitute but
one and the same Agreement.
SECTION 9.5. SEVERABILITY OF INVALID PROVISIONS. If any clause,
provision or section of this Agreement be held illegal or invalid by any
court, the invalidity of such clause, provision or section shall not
affect any of the remaining clauses, provisions or sections hereof, and
this Agreement shall be construed and enforced as if such illegal or
invalid clause, provision or section had not been contained herein.
SECTION 9.6. GOVERNING LAW. This Agreement shall be governed as to
validity, construction and performance by the laws of the State.
SECTION 9.7. TAX EXEMPTIONS AND CREDITS. The Company may take
action to secure certain ad valorem tax exemptions (other than school
taxes) available under Sections 00-00-000 and/or 00-00-000 of the
Mississippi Code of 1972, as amended, and income tax credits under Section
00-00-000 of the Act as well as other provisions of the Mississippi Code
of 1972, as amended. The Issuer will assist the Company in securing said
tax exemptions and credits.
SECTION 9.8. NO ORAL ARGUMENT. This written Loan Agreement and the
other Loan 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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written on the cover
page hereof.
MISSISSIPPI BUSINESS FINANCE CORPORATION
BY: /s/X. XXXXX
------------------------------------
EXECUTIVE DIRECTOR
ATTEST:
/s/XXXXXX XXXXX
-----------------------------
SECRETARY
STATE OF MISSISSIPPI
COUNTY OF XXXXX
Personally appeared before me, the undersigned notary public in and
for the jurisdiction aforesaid, the within named XXXXXXX X. XXXXX and
XXXXXX XXXXX, to me known, who acknowledged they are the Executive
Director and Secretary, respectively, of the MISSISSIPPI BUSINESS FINANCE
CORPORATION, a public corporation organized and existing under the laws of
the State of Mississippi, and that for and on behalf of said corporation
and as its act and deed, they signed and delivered the foregoing LOAN
AGREEMENT as of the date therein mentioned with actual execution on the
date of this acknowledgment, after having been first duly authorized so to
do.
IN WITNESS WHEREOF, I hereunto set my hand and official seal, this the
day of June, 1998.
----------------------------------
NOTARY PUBLIC
MY COMMISSION EXPIRES:
----------------------
[ S E A L ]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written on the cover
page hereof.
XXXXXXX DURA-VENT COMPANY, INC.
BY: /s/XXXXXXX X. XXXXXX
------------------------------
TITLE: C.F.O.
---------------------------
STATE OF CALIFORNIA
--------------------
COUNTY OF ALAMEDA
-------------------
Personally appeared before me, the undersigned notary public in and
for the jurisdiction aforesaid, the within named XXXXXXX X. XXXXXX,
to me known, who acknowledged he is the C.F.O. , of
XXXXXXX DURA-VENT COMPANY, INC., a corporation organized and existing
under the laws of the State of California, and that for and on behalf of
said corporation and as its act and deed, he signed and delivered the
foregoing LOAN AGREEMENT as of the date therein mentioned with actual
execution on the date of this acknowledgment, after having been first duly
authorized so to do.
IN WITNESS WHEREOF, I hereunto set my hand and official seal, this
the 26th day of June, 1998.
/s/XXXXXXXX X. XXXXXXXX
----------------------------------
NOTARY PUBLIC
MY COMMISSION EXPIRES:
MAY 4, 2001
----------------------
[ S E A L ]
EXHIBIT A
TO
LOAN AGREEMENT DATED AS OF MAY 1, 1998
BY AND BETWEEN
MISSISSIPPI BUSINESS FINANCE CORPORATION
AND
XXXXXXX DURA-VENT COMPANY, INC.
BUILDING DESCRIPTIONS
---------------------
BUILDING
--------
Construction of a building consisting of approximately _______ sq.
ft. and located on the Project Site described in Exhibit B hereto.
EXHIBIT B
TO
LOAN AGREEMENT DATED AS OF MAY 1, 1998
BY AND BETWEEN
MISSISSIPPI BUSINESS FINANCE CORPORATION
AND
XXXXXXX DURA-VENT COMPANY, INC.
THE PROJECT SITE
----------------
WARRANTY DEED
IN CONSIDERATION of the sum of Ten ($10.00) Dollars cash in hand paid
and other good valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the undersigned, XXXXXXX MANUFACTURING CO., INC.,
a California corporation, ("Grantor"), does hereby, subject to the terms
and conditions hereinafter stated, convey and warrant unto XXXXXXX DURA-VENT
COMPANY, INC. ("Grantee"), that certain tract or parcel of land lying and
being situate in Xxxxxx County, State of Mississippi, more particularly
described as follows, to-wit:
A parcel of land lying in the Northwest One-Quarter (NW 1/4) of
the Southeast One-Quarter (SE 1/4) and in the Northeast One-
Quarter (NE 1/4) of the Southeast One-Quarter (SE 1/4) and in the
Southwest One-Quarter (SW 1/4) of the Southeast One-Quarter (SE
1/4) and in the Southeast One-Quarter (SE 1/4) of the Southeast
One-Quarter (SE 1/4) of Section 13, Township 16 North, Range 5
East, Xxxxxx County, Mississippi, more particularly described as
follows, to-wit:
Beginning at an iron pin marking the intersection of the Southerly
line of Road "B" Extended with the Easterly line of Road "C" of
the Industrial Complex, Phase I, E.D.A. Project No. 00-00-00000,
Contract 3, Site Development, said iron pin being 50 feet from the
centerline of Road "C" and 50 feet from the centerline of Road
"B", all being measured perpendicular to the centerline of each
roadway; said iron pin lying 5,645.65 feet South of and 3,454.40
feet East of an iron rail marking the Northwest corner of the
Southwest One-quarter of Section 00, Xxxxxxxx 00 Xxxxx, Xxxxx 0
Xxxx, Xxxxxx Xxxxxx, Xxxxxxxxxxx; said iron pin lying South 05
degrees 46 minutes 09 seconds East, 100.11 feet from a recovered
iron pin marking the Southwest corner of that tract conveyed by
Xxxxxx County, Mississippi to XxXxxxx Foods, Inc. by Warranty Deed
dated April 17, 1990 and recorded in Deed book 890 at Page 658 of
the records of the Chancery Clerk at Vicksburg, Xxxxxx County,
Mississippi; run thence North 85 degrees 14 minutes 36 seconds
East, 30.0 feet along the Southerly line of Road "B" Extended;
thence leaving the Southerly line of Road "B" Extended, run South
05 degrees 59 minutes 24 seconds East, 38.15 fee; run thence North
85 degrees 01 minutes 06 seconds East, 38.0 feet; run thence North
05 degrees 59 minutes 24 seconds West, 38.0 feet to the Southerly
line of Road "B" Extended; run thence North 85 degrees 14 minutes
36 seconds East, 822.00 feet along the Southerly line of Road "B"
Extended; thence leaving the Southerly line of Road "B" Extended,
run South 04 degrees 45 minutes 24 seconds East, 1,160.77 feet;
run thence South85 degrees 14 minutes 36 seconds West, 870.21 feet
to the Easterly line of Road "C"; run thence North 05 degrees 44
minutes 00 seconds West, 1,160.94 feet along the Easterly line of
Road "C" to the Point of Beginning, containing 23.420 acres, more
or less, a plat of said property being attached hereto in aid of
this description.
The warranty of this conveyance is subject to all of the terms and
conditions set forth in that certain Warranty Deed from Xxxxxx County,
Mississippi and the Xxxxxx County Port Commission to Xxxxxxx Manufacturing
Co., Inc. dated November 6, 1997 and recorded in Book 1124 at Page 1 in the
office of the Chancery Clerk of Xxxxxx County, Mississippi.
It is Grantor's intention herein to convey to the Grantee herein all of
the property which Grantor acquired by deed from Xxxxxx County, Mississippi
and the Xxxxxx County Port Commission dated November 6, 1997 and recorded in
Book 1124 at Page 1 in the office of the Chancery Clerk of Xxxxxx County,
Mississippi.
WITNESS the signature of the undersigned on this the 26th day of March
1998.
XXXXXXX MANUFACTURING CO., INC.
BY: /s/XXXXXXX X. XXXXXX
---------------------------
STATE OF CALIFORNIA
--------------
COUNTY OF ALAMEDA
-------------
PERSONALLY appeared before me the undersigned authority, in and for
said County and State, within my jurisdiction, the within named, XXXXX
XXXXXX, who acknowledged that he is C.F.O. of Xxxxxxx Manufacturing Co.,
Inc., a California corporation, and that for and on behalf of said
corporation, and as its act and deed, he signed, sealed and delivered the
above and foregoing instrument of writing for the purposes mentioned on the
day and year therein mentioned, after first having been duly authorized by
said corporation so to do.
GIVEN under my hand and official seal of office this the 26th day of
MARCH, 1998.
/s/Xxxxxxxx X. Xxxxxxxx
---------------------------
MY COMMISSION EXPIRES:
May 4, 2001
----------------------
Grantor: Grantee:
Name: Xxxxxxx Manufacturing Name: Xxxxxxx Dura-Vent
Co., Inc. Company, Inc.
Add: 0000 Xxxxxx Xxxxx, Xxx 000 Add: 0000 Xxxxxxx Xxxx
X.X. Xxx 00000 Xxxxxxxxx, XX
Xxxxxxxxxx, XX 00000-0000
Bus. Phone:0-000-000-0000 Bus. Phone: 000-0000
Prepared by:
Xxxxx, Xxxxxxxx & Xxxx, Ltd.
000 Xxxxxxx Xxxxxx
X.X. Xxxxxx 0000
Xxxxxxxxx, XX 00000
Telephone: 000-0000
Fax: 000-0000
EXHIBIT C
TO
LOAN AGREEMENT DATED AS OF MAY 1, 1998
BY AND BETWEEN
MISSISSIPPI BUSINESS FINANCE CORPORATION
AND
XXXXXXX DURA-VENT COMPANY, INC.
EQUIPMENT
---------
All items of machinery, equipment (including parts, accessories and
attachments thereto), fixtures and other personal property acquired with
the proceeds of the Bonds, including all substitutions and replacements of
such personal property and fixtures and the proceeds thereof, which are
acquired or are to be acquired by the Company with the proceeds of the
Loan and the Bonds. A complete detailed list of items of personalty
acquired with the proceeds of the Loan and the Bonds is on file in the
office of the Trustee in its corporate trust office in San Francisco,
California.
EXHIBIT D
TO
LOAN AGREEMENT DATED AS OF MAY 1, 1998
BY AND BETWEEN
MISSISSIPPI BUSINESS FINANCE CORPORATION
AND
XXXXXXX DURA-VENT COMPANY, INC.
PROMISSORY NOTE
---------------
DATE: JUNE 30, 1998 $3,000,000 MAXIMUM PRINCIPAL AMOUNT
FOR VALUE RECEIVED, Xxxxxxx Dura-Vent Company, Inc., a corporation
organized and existing under and pursuant to the laws of the State of
California and qualified to do business in the State of Mississippi (the
"Company"), hereby promises to pay to the order of Mississippi Business
Finance Corporation (the "Issuer") or its assigns, the principal amount of
$3,000,000 together with interest on the unpaid principal balance thereof
at the rates set forth in the hereinafter defined Loan Agreement and
Indenture until fully and finally paid, and all other amounts payable by
the Company under the Loan Agreement (as hereinafter defined). This Note
shall bear interest at the prevailing rate of interest on the Bonds (as
hereinafter defined) except as otherwise provided hereunder.
This Note has been executed under and pursuant to a Loan Agreement
dated as of May 1, 1998 between the Issuer and the Company (the "Loan
Agreement") and will be issued and secured by a Trust Indenture dated as
of May 1, 1998 between the Issuer and Union Bank of California, N.A., as
Trustee (the "Indenture"), which Loan Agreement and Indenture are
incorporated herein in their entirety by reference. This Note is issued
to evidence the obligation of the Company under the Loan Agreement to
repay the loan made by the Issuer from the proceeds of the Mississippi
Business Finance Corporation Taxable Industrial Development Revenue Bonds,
Series 1998, (Xxxxxxx Dura-Vent Company, Inc. Project) (the "Bonds"),
together with interest thereon at the interest rates as set forth in the
Loan Agreement, the Indenture and the Bonds, and all other payments of any
kind required to be paid by the Company under the Loan Agreement. The Loan
Agreement includes provisions for prepayment and acceleration of this
Note. In the event that the terms of this Note conflict with the terms of
the Loan Agreement, the Indenture and the Bonds, the terms of the Loan
Agreement, the Indenture and the Bonds shall control. The proceeds of the
Loan (and the Bond) will be funded at such time as the Bond and the Note
are executed and delivered.
As provided in the Loan Agreement and subject to the provisions
thereof including, without limitation, Section 4.2(c) thereof, payments
hereon are to be made at the principal office of the Trustee as shown in
the Loan Agreement in an amount which together with other monies available
therefor pursuant to the Loan Agreement, will equal the amount payable as
principal of, premium, if any, and interest on the Bonds Outstanding (as
defined in the Loan Agreement) on such due date. Each payment of
principal and interest on this Note shall constitute an equal and
corresponding payment under the Loan Agreement, the Indenture and the
Bond.
The Company shall make principal payments on this Note in the amounts
on the dates and at the rates of interest, unless paid prior thereto
through redemption, all as set forth in the Loan Agreement and the
Indenture and in addition shall make such other payments as are required
pursuant to the Loan Agreement, the Indenture and the Bonds. Upon the
occurrence of an Event of Default, as defined in the Loan Agreement, the
principal of, premium, if any, and interest on this Note may be declared
immediately due and payable as provided in the Loan Agreement. Upon any
such declaration the Company shall pay all costs, disbursements, expenses
and reasonable counsel fees of the Issuer, the Purchaser and the Trustee
in seeking to enforce their rights under the Loan Agreement and this Note.
The Company (a) waives diligence, demand, presentment for payment,
notice of nonpayment, protest and notice of protest, notice of any
renewals or extension of this Note, and (b) agrees that the time for
payment of this Note may be extended at the sole discretion of the Issuer
without impairing the Company's liability hereon. Any delay on the part
of the Issuer in exercising any right hereunder shall not operate as a
waiver of any such right, and any waiver granted with respect to one
default shall not operate as a waiver in the event of any subsequent or
continuing default.
This Note shall be governed and construed in accordance with the laws
of the State of Mississippi.
IN WITNESS WHEREOF, the undersigned has caused this Note to be
executed in its name and, if applicable, its corporate seal to be hereunto
affixed and attested to by its duly authorized officers all as of the day
and year first above written.
XXXXXXX DURA-VENT COMPANY, INC.
BY: /s/XXXXXXX X. XXXXXX
------------------------------
TITLE: C.F.O.
---------------------------
ASSIGNMENT OF PROMISSORY NOTE
FOR VALUE RECEIVED, the Mississippi Business Finance Corporation
hereby assigns and transfers, without recourse, to Union Bank of
California, N.A., as Trustee, the Promissory Note executed by Xxxxxxx
Dura-Vent Company, Inc., in favor of Mississippi Business Finance
Corporation in the principal amount of $3,000,000 on this the ____ day of
June, 1998.
MISSISSIPPI BUSINESS FINANCE CORPORATION
BY:
------------------------------
EXECUTIVE DIRECTOR
ATTEST:
-------------------------
SECRETARY
