SUPPORT AGREEMENT
This SUPPORT AGREEMENT ("Agreement") is made as of the 3rd day of
January, 1997, among Xxxxxx X. Xxxxxxxx (hereinafter referred to as the
"undersigned"), Service Business Systems, Inc., Colorado corporation (the
"Borrower"), and Norwest Business Credit, Inc. (hereinafter referred
to as "NBCI").
WITNESSETH:
WHEREAS, NBCI and Borrower have entered into that certain Credit and
Security Agreement ("Credit Agreement") dated as of January 3, 1997,
pursuant to which NBCI may, from time to time, at its discretion, make
advances to or for the benefit of Borrower;
WHEREAS, the undersigned is the duly elected, qualified and acting
President of the Borrower and is fully familiar with all of the Borrower's
business and financial affairs;
NOW, THEREFORE, to induce NBCI to make advances to or for the account
of the Borrower under the Credit Agreement and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the undersigned, the Borrower and NBCI agree as follows:
1. The undersigned agrees that in the event (i) NBCI comes into
possession of any or all of the tangible Collateral (as such term is defined
in the Credit Agreement) or is collecting the Borrower's accounts receivable
or otherwise disposing of Collateral by reason of the occurrence of an Event
of Default under the Security Documents (as defined in Credit Agreement),
(ii) NBCI has given notice of an acceleration of all of the obligations under
and an defined in the Security Agreement, and (iii) he is then in the employ
of the Borrower, he will, if and at such time as he ceases to be employed by
the Borrower, at NBCI's option and upon NBCI's request, and until this
Agreement shall have terminated as provided herein, enter NBCI's employ for a
period not to exceed six months, for the sole purpose of disposing of such
Collateral and collecting such accounts, or assisting NBCI in disposing of
such Collateral and collecting such accounts. During the period of such
employment the undersigned shall exert his best efforts and devote all of
his regular working hours to obtain sales of such Collateral at the best
obtainable prices and terms and to collect such accounts at their full face
value. If the events described in clauses (i) and (ii) occur at a time when
the undersigned is employed by the Borrower, then, if requested by NBCI,
Borrower shall cause the undersigned, so long as he is in its employ, to
exert his best efforts and devote all of his regular working hours to obtain
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sales of such Collateral at the best obtainable prices and terms and to
collect such accounts at their full face value.
2. NBCI shall have the right to terminate the undersigned's
employment or other assistance described in Paragraph 1 above at any time on
five business days' notice, for any cause or without cause.
3. The sole compensation and remuneration of the undersigned for
any employment or assistance rendered pursuant to Paragraph 1 above shall be
a weekly salary paid at the same rate as the average salary (on a weekly
basis) paid to such person by Borrower in the twelve (12) months immediately
preceding the commencement of such employment or activities. Such
compensation shall be prorated for partial weeks of service.
4. In connection with such employment, the undersigned shall not
have any authority to bind NBCI, except such specific authority as NBCI may
grant in writing.
5. In the event that the undersigned fails to comply with the
provisions of Paragraph 1 above, unless such failure occurs as a result of
death, mental or physical incapacity, or NBCI's termination of employment of
the undersigned, the undersigned shall pay NBCI an amount equal to $25,000 as
liquidated damages, but not as a penalty, because of the difficulty of
proving actual damages for the breach of premium of the type contained
herein. Such liquidated damages shall be immediately due and payable upon
the failure by the undersigned to comply with the provisions of Paragraph 1
above. In addition, the undersigned shall be liable for NBCI's costs and
expenses (including reasonable attorneys, fees and legal costs) incurred in
enforcing this liquidated damages provision. In no event, however, shall the
undersigned be liable for more than NBCI's actual damages, plus NBCI's costs
of enforcement of this Agreement. Notwithstanding the foregoing, the
undersigned shall not have any obligation under this Paragraph 5 if he shall
have ceased to be employed by the Borrower more than thirty (30) business
days prior to the occurrence of the events described in clauses (i) add (ii)
of Paragraph 1 hereof, and shall have given notice of such cessation of
employment to NBCI at least thirty (30) business days prior to the occurrence
of such events.
6. In the event of the death, mental or physical incapacity, or
termination by NBCI of employment of the undersigned, Borrower shall be
responsible for obtaining a replacement for such person and Borrower shall
use its best efforts to cause such replacement to execute a support agreement
substantially in the form of this Agreement.
7. This agreement shall remain in full force and effect so long as
the Credit Agreement is outstanding or until otherwise agreed by an amendment
hereto signed by NBCI and the undersigned.
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8. The provisions of this Agreement are declared to be severable.
If any provision of this Agreement shall be held to be invalid, illegal or
unenforceable, such invalidity, illegality or unenforceability shall not
affect any other provisions of this Agreement.
9. The undersigned and the Borrower waive notice of NBCI's
acceptance hereof.
SERVICE BUSINESS SYSTEMS, INC.
BY(Signature) /s/Xxxxxx X. Xxxxxxxx
(Name and Title) Xxxxxx X. Xxxxxxxx,
President and CEO
NORWEST BUSINESS CREDIT, INC.
BY(Signature) /s/Xxxx Xxxxxxxx
(Name and Title) Xxxx Xxxxxxxx,
Vice President
BY(Signature) /s/Xxxxxx X. Xxxxxxxx
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