LOAN AGREEMENT
Name and Address of Borrower:
Rotherwood Corporation Legal Status of Borrower: corporation
000 Xxxxx Xx. Jurisdiction of Borrower: Xxxxxxxxx
Xxxxxx Xxxx, XX 00000-0000
Name and address of Guarantors:
Xxxxxx, Inc. Legal Status of Guarantor: corporation
000 Xxxxx Xx. Jurisdiction of Guarantor: Kansas
Xxxxxx Xxxx, XX 00000-0000
The American Companies, Legal Status of Guarantor: corporation
Inc. Jurisdiction of Guarantor: Kansas
000 Xxxxx Xx.
Xxxxxx Xxxx, XX 00000-0000
Sagebrush Technology, Legal Status of Guarantor: corporation
Inc. Jurisdiction of Guarantor: Minnesota
00000 X. Xxxxxxxx Xx.
Xxxxxxxxxx, XX 00000
Pacer Corporation Legal Status of Guarantor: corporation
00 Xxxxx 0xx Xxxxxx Jurisdiction of Guarantor: South Dakota
Xxxxxx, XX 00000
American Bindery-Xxxxx, Legal Status of Guarantor: corporation
Inc. Jurisdiction of Guarantor: Virginia
0000 Xxxxxxxx Xxxx
Xxxxxxxx, XX
Dollar Amount and Type of Facility: $3,750,000.00 Revolving
Line of Credit
(See attached Facility Description Rider for details)
This Agreement, entered into this 27th day of August, 1996, by
and between the above named Borrower (hereinafter called
"Borrower"), Xxxxxx Inc., The American Companies, Inc., Sagebrush
Technology, Inc., Pacer Corporation (hereinafter sometimes called
the "Borrowing Base Guarantors"), American Bindery-Xxxxx, Inc.
(American Bindery-Xxxxx, Inc. and the Borrowing Base Guarantors
herein sometimes referred to collectively as the "Guarantors")
and Xxxx Xxxxx Kansas City Bank, 0000 Xxxx, Xxxxxxx, Xxxxxx 00000
(hereinafter called "Bank"). Borrower is desirous of borrowing
from Bank the amount specified in the attached Facility
Description Rider and the Bank is willing to lend to Borrower
such specified amount in accordance with certain terms,
warranties, covenants, and agreements as specified herein.
ARTICLE I
SECTION 1.1. Payments and Computations. The Borrower shall
make each payment hereunder and under the Note (further described
in the Facility Description Rider attached and hereinafter
referred to as the "Note") not later than 12:00 noon (Kansas
City, Kansas time) on the day when due in lawful money of the
United States of America to the Bank at its address referred to
above. All computations of interest under the Note shall be made
by the Bank on the basis of a year of 360 days for the actual
number of days (including the first day but excluding the last
day) elapsed.
SECTION 1.2. Payment on Non-Business Days. Whenever any
payment to be made hereunder or under the Note shall be stated to
be due on a Saturday, Sunday or a public or bank holiday or the
equivalent for banks generally under the laws of the State of
Missouri (any other day being a "Business Day"), such payment may
be made on the next succeeding Business Day, and such extension
of time shall in such case be included in the computation of
payment of interest.
SECTION 1.3. Conditions Precedent to Advances. If the Facility
provides for future advances, then the obligation of the Bank to
make any advance to the Borrower shall be subject to the
conditions precedent that on the date of such advance (i) the
representations and warranties contained in Section 2.1 remain
correct on and as of such date as though made on and as of such
date, (ii) no event has occurred and is continuing, or would
result from such advance, which constitutes an Event of Default
(as defined in Section 4.1 hereof) or would constitute an Event
of Default but for the requirement that notice be given or time
elapse or both, and (iii) the Bank shall have received such
approvals, opinions and documents as the Bank may reasonably
request.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
SECTION 2.1. Representations and Warranties of the Borrower.
The Borrower represents and warrants as follows:
(a) The Borrower's legal status is correctly set forth at
the beginning of this Loan Agreement, and the Borrower has been
duly formed and is validly existing and in good standing under
the laws of the state of its organization as set forth above.
(b) The execution, delivery and performance by the Borrower
of this Agreement, the Note and any other documents or agreements
executed in connection herewith are within the Borrower's
corporate or partnership powers (as the case may be), have been
duly authorized by all necessary action on the part of its
officers, directors, shareholders or partners, and do not
contravene (i) the Borrower's organizational documents (Articles
of Incorporation, by-laws or partnership agreement) or (ii) any
law or any contractual restriction binding on or affecting the
Borrower.
(c) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or
regulatory body is required for the due execution, delivery and
performance by the Borrower of this Agreement or the Note.
(d) This Agreement is, and the Note when delivered
hereunder will be, legal, valid and binding obligations of the
Borrower enforceable against the Borrower in accordance with
their respective terms.
(e) The balance sheets of the Borrower and the related
statements of income and retained earnings, copies of which have
been furnished to the Bank, fairly present the financial
condition of the Borrower as of the date of such reports and the
results of the operations of the Borrower as of such date, all in
accordance with generally accepted accounting principles
consistently applied throughout the periods involved, and since
such date there has been no material adverse change in such
condition or operations.
(f) There is no pending or threatened action or proceeding
affecting the Borrower before any court, governmental agency or
arbitrator, which may materially adversely affect the financial
condition or operations of the Borrower.
ARTICLE III
COVENANTS OF THE BORROWER
SECTION 3.1. Standard Covenants. So long as the Note shall
remain unpaid or, in the case of a facility providing for future
advances, the Bank shall have any commitment to make advances to
the Borrower hereunder, the Borrower will, unless the Bank shall
otherwise consent in writing:
(a) Compliance with Laws. Comply in all material respects
with all applicable laws, rules, regulations and orders, such
compliance to include, without limitation, paying before the same
become delinquent all taxes, assessments and governmental charges
imposed upon it or upon its property except to the extent
contested in good faith.
(b) Maintenance of Insurance. Maintain insurance with
responsible and reputable insurance companies or associations in
such amounts and covering such risks as is usually carried by
companies engaged in similar businesses and owning similar
properties in the same general area in which the Borrower
operates.
(c) Maintenance of Existence. Maintain its corporate or
partnership existence, as the case may be, in the jurisdiction of
its organization.
(d) Reporting Requirements. Furnish to the Bank:
(i) As soon as available and in any event within 45
days after the end of each quarter balance sheets of
the Borrower as of the end of each quarter and
statements of income and retained earnings of the
Borrower of for the period commencing at the end of the
previous fiscal year and ending with the end of each
quarter certified by the chief financial officer of the
Borrower;
(ii) As soon as available and in any event within 90
days after the end of each fiscal year of the Borrower,
a copy of the balance sheets, financial statement and
retained earnings of the Borrower certified in a manner
acceptable to the Bank by an independent Public
Accounting Firm satisfactory to the Bank;
(iii) Other ___________________________________________
______________________________________________________;
and, such other information respecting the condition or
operations, financial or otherwise, of the Borrower as the Bank
may from time to time reasonably request.
(e) Negative Pledge. Not create or suffer to exist any
lien, security interest or other charge or encumbrance, or any
other type of preferential arrangement, upon or with respect to
any of its properties, whether now owned or hereafter acquired;
or assign any right to receive income.
(f) Change in Nature of Business. Not make any material
change in the nature of its business as carried on at the date
hereof.
SECTION 3.2. Special Covenants and/or Agreements.
X See attached facility description and/or special
covenant rider which is/are incorporated herein by
reference.
ARTICLE IV
EVENTS OF DEFAULT
SECTION 4.1. Events of Default. If any of the following events
("Events of Default") shall occur and be continuing:
(a) The Borrower shall fail to pay any installment of
principal or interest on the Note when due; or
(b) Any representation or warranty made by the Borrower in
connection with this Agreement shall prove to have been incorrect
in any material respect when made; or
(c) The Borrower shall fail to perform or observe any other
term, covenant or agreement contained in this Agreement or in any
other document relative to this Agreement on its part to be
performed or observed; or
(d) The Borrower shall fail to pay any Debt ["Debt" means
(i) indebtedness for borrowed money or for the deferred purchase
price of property or services, (ii) obligations as lessee under
leases which shall have been or should be, in accordance with
generally accepted accounting principles, recorded as capital
leases, (iii) obligations under direct or indirect guaranties in
respect of, and obligations (contingent or otherwise) to purchase
or otherwise acquire, otherwise to assure a creditor against loss
in respect of, indebtedness or obligations of others of the kinds
referred to in clause (i) or (ii) above, (iv) liabilities in
respect of unfunded vested benefits under employee retirement
plans covered by Title IV of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), and (v) withdrawal
liability asserted by the sponsor of any multi-employer plan (as
defined in ERISA)], but excluding Debt evidenced by the Note of
the Borrower, or any interest or premium thereon, when due
(whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise) and such failure shall
continue after the applicable grace period, if any, specified in
the agreement or instrument relating to such Debt; or
(e) The Borrower shall generally not pay its Debts as such
Debts become due, or shall admit in writing its inability to pay
its Debts generally, or shall make a general assignment for the
benefit of creditors; or any proceeding shall be instituted by or
against the Borrower seeking to adjudicate it a bankrupt or
insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief, or composition of it
or its Debt under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an
order for relief or the appointment of a receiver, trustee, or
other similar official for it or for any substantial part of its
property; or
(f) A final judgment or order for the payment of money in
excess of $10,000.00 shall be rendered against the Borrower and
either (i) enforcement proceedings shall have been commenced by
any creditor upon such judgment or order or (ii) there shall be
any period of 10 consecutive days during which a stay of
enforcement of such judgement or order, by reason of a pending
appeal or otherwise, shall not be in effect; or
(g) The Borrower shall be in default under any other
agreement between the Borrower and the Bank; or
(h) Any provision of any guaranty, security agreement,
pledge agreement, deed of trust or other document that secures
the Note shall for any reason cease to be valid and binding on
the guarantor, pledgor or grantor (as the case may be), or the
guarantor, pledgor or grantor shall so state in writing; or
(i) Any pledge agreement, security agreement, deed of trust
or other document that secures the Note shall for any reason,
except to the extent permitted by the terms thereof, cease to
create a valid and perfected security interest in any of the
collateral or real estate purported to be encumbered thereby; or
(j) The Bank shall determine that the prospects for
repayment of the Note have been adversely affected or the Bank
otherwise deems itself insecure; then, and in any such event, the
Bank may (i) in the case of a facility providing for future
advances, declare any obligation to make additional advances to
the Borrower to be terminated, whereupon the same shall forthwith
terminate, and (iii) in all cases, declare the Note, all interest
thereon and all other amounts payable under this Agreement to be
forthwith due and payable, whereupon the Note, all such interest
and all such amounts shall become and be forthwith due and
payable, without presentment, demand, protest, or further notice
of any kind, all of which are hereby expressly waived by the
Borrower. IF THE NOTE IS STATED TO BE PAYABLE ON DEMAND, THEN
THIS ENUMERATION OF EVENTS OF DEFAULT AND THE REMEDIES SHALL NOT
BE CONSTRUED TO ALTER THE DEMAND NATURE OF THE NOTE.
ARTICLE V
MISCELLANEOUS
SECTION 5.1. Amendments and Waivers. No amendment or waiver of
any provision of this Agreement or the Note, nor consent to any
departure by the Borrower therefrom, shall in any event be
effective unless the same shall be in writing and signed by the
Bank and then such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which
given.
SECTION 5.2. Notices. All notices and other communications
provided for hereunder shall be in writing (including telegraphic
communication, and mailed or telegraphed or delivered, if to the
Borrower, at its address on the cover page hereof; and if to the
Bank, at its address on the cover page hereof, Attention
President; or, as to each party, at such other address as shall
be designated by such party in a written notice to the other
party. All such notices and communications shall, when mailed or
telegraphed, be effective when deposited in the mails or
delivered to the telegraph company, respectively, addressed as
aforesaid, except that notices to the Bank pursuant to the
provisions of Article I shall not be effective until received by
the Bank.
SECTION 5.3. Remedies. No failure on the part of the Bank to
exercise, and no delay in exercising, any right hereunder or
under the Note shall operate as a waiver thereof; nor shall any
single or partial exercise of any right hereunder or under the
Note preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
SECTION 5.4. Accounting Terms. All accounting terms not
specifically defined herein shall be construed in accordance with
generally accepted accounting principles consistently applied.
SECTION 5.5. Subsidiaries. If the Borrower has any
subsidiaries, then the Borrower (i) represents that each of the
representations and warranties in Article II hereof is true and
correct with respect to each of its subsidiaries, and (ii)
covenants and agrees to cause each of its subsidiaries to comply
with all of the covenants in Article III hereof.
SECTION 5.6. Costs, Expenses and Taxes. The Borrower agrees to
pay on demand all costs and expenses in connection with
preparation, execution, delivery and administration of this
Agreement, the Note and the other documents to be delivered
hereunder, including, without limitation, the reasonable fees and
out-of-pocket expenses of counsel for the Bank with respect
thereto and with respect to advising the Bank as to its rights
and responsibilities under this Agreement, and all costs and
expenses, if any (including counsel fees and expenses), in
connection with the enforcement of this Agreement, the Note and
the other documents to be delivered hereunder.
SECTION 5.7. Right of Set-off. Upon the occurrence and during
the continuance of any Event of Default the Bank is hereby
authorized at any time and from time to time, to the fullest
extent permitted by law, without notice to the Borrower (any such
notice being expressly waived by the Borrower), to set off and
apply any and all deposits (general or special, time, demand, or
Certificate of Deposit, provisional or final) at any time held
and other indebtedness at any time owing by the Bank to or for
the credit or the account of the Borrower against any and all of
the obligations of the Borrower now or hereafter existing under
this Agreement and the Note, irrespective of whether or not the
Bank shall have made any demand under this Agreement or the Note
and although such obligations may be unmatured. The Bank agrees
promptly to notify the Borrower after any such set-off and
application, provided that the failure to give such notice shall
not affect the validity of such set-off and application. The
rights of the Bank under this Section are in addition to other
rights and remedies (including, without limitation, other rights
of set-off) which the Bank may have.
SECTION 5.8. Lien on Deposits and Other Property Held by Bank.
As security for the due payment and performance of all
obligations of the Borrower under this Agreement and the Note and
any other obligations of the Borrower to the Bank, whether now
existing or hereafter arising, the Borrower hereby grants to the
Bank a lien on and security interest in any and all deposits
(general or special, time, demand, or Certificate of Deposit,
provisional or final) or other sums at any time credited by or
due from the Bank to the Borrower, and any and all monies,
securities and other property of the Borrower, and the proceeds
thereof, now or hereafter held or received by or in transit to
the Bank from or for the Borrower, whether for safekeeping,
custody, pledge, transmission, collection or otherwise, and any
such deposits, sums, monies, securities and other property may,
when an Event of Default has occurred and is continuing, be set
off, appropriated and applied by the Bank against any and all
obligations, whether now existing or hereafter arising, of the
Borrower to the Bank under this Agreement or the Note or
otherwise.
SECTION 5.9. Participations. The Borrower hereby acknowledges
that the Bank may from time to time sell all or part of this loan
to other participants. The Borrower authorizes the Bank to
disclose information about the Borrower to such participants, and
hereby grants to any participants all rights and remedies granted
to the Bank under Section 5.7 and 5.8 hereof.
SECTION 5.10. Binding Effect; Governing Law. This Agreement
shall be binding upon and inure to the benefit of the Borrower
and the Bank and their respective successors and assigns, except
that the Borrower shall not have the right to assign its rights
hereunder or any interest herein without the prior written
consent of the Bank. This Agreement and the Note shall be
governed by, and construed in accordance with, the laws of the
State of Kansas, and Borrower agrees that any consent to
jurisdiction and venue in this Agreement or in any of the other
loan documents given in conjunction herewith shall not prohibit
or in any way limit Bank from bringing any action or proceeding
in any jurisdiction or venue that is otherwise proper in the
event of any legal proceeding under any such loan documents.
SECTION 5.11. Other Terms. If there is a rider or riders
attached to this Loan Agreement, then the terms contained therein
shall be deemed to be incorporated herein by reference, and any
such terms shall govern over any inconsistent term herein.
SECTION 5.12. Renewal, etc. of Note. If the Note is renewed,
extended, modified or amended in any respect after the date
hereof, or if another note is given in replacement or
substitution of the Note, then each successive renewal,
extension, modification, amendment, replacement or substitution
shall be deemed to incorporate the terms of this Agreement, and
any Rider hereto, except to the extent that the Borrower and the
Bank otherwise agree in writing.
THIS AGREEMENT IS THE FINAL EXPRESSION OF THE CREDIT AGREEMENT
BETWEEN BORROWER AND LENDER, AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR OR CONTEMPORANEOUS ORAL AGREEMENTS OR PRIOR
WRITTEN AGREEMENTS BETWEEN BORROWER AND LENDER. IF THERE ARE ANY
ADDITIONAL TERMS OR ORAL AGREEMENTS, THEY ARE REDUCED TO WRITING
AS FOLLOWS: NONE
BORROWER HEREBY AFFIRMS THAT NO UNWRITTEN ORAL AGREEMENTS BETWEEN
BORROWER AND LENDER.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their duly authorized representatives, as of
the date first above written.
XXXX XXXXX KANSAS CITY BANK ROTHERWOOD CORPORATION
(Name of Borrower)
By: Title: By: /s/ Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx, Secretary
XXXXXX INC.
(Name of Guarantor)
By: /s/ Xxxx Xxxxx
Xxxx Xxxxx, Secretary
THE AMERICAN COMPANIES, INC.
(Name of Guarantor)
By: /s/ Xxxx Xxxx
Xxxx Xxxx, Secretary
SAGEBRUSH TECHNOLOGY, INC.
(Name of Guarantor)
By: /s/ Xxxx Xxxx
Xxxx Xxxx, Secretary
PACER CORPORATION
(Name of Guarantor)
By: /s/ Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxx, President
AMERICAN BINDERY-XXXXX, INC.
(Name of Guarantor)
By: /s/ Xxxxx X. Xxxxxxxxx
Xxxxx X. Xxxxxxxxx, President
