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EXHIBIT 10.22
LOAN AGREEMENT
THIS LOAN AGREEMENT (this "Agreement") is executed as of the 7th day of
August, 1998, by and between TELEHUB COMMUNICATIONS CORPORATION, a Nevada
corporation ("Telehub") and XXXXXXX X. XXXXXX, an individual ("Borrower").
WITNESSETH:
WHEREAS, Telehub and Borrower entered into an Employment Agreement dated
May 4, 1998, as subsequently amended on even date therewith (collectively, as
amended the "Employment Agreement"), which provides the terms and conditions of
Borrower's employment with Telehub;
WHEREAS, pursuant to the terms and conditions of the Employment Agreement,
Telehub has agreed to loan Four Hundred Thousand Dollars ($400,000.00) to
Borrower for the purchase of a residence in Illinois (the "Loan");
WHEREAS, in consideration for Telehub making the Loan, Borrower has agreed
to execute and deliver to Telehub a promissory note in the principal amount of
Four Hundred Thousand Dollars ($400,000.00) in the form attached hereto as
Exhibit A and incorporated herein by this reference (the "Note"), and to secure
the Note by executing a deed of trust (the "Deed of Trust") for the Illinois
residence (the "Real Property") in favor of Telehub pursuant to the terms and
conditions set forth herein.
NOW THEREFORE, in consideration of the mutual convenants and agreements
contained herein, and for other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, the parties agree as follows:
1. LOAN TERMS AND CONDITIONS. Upon the mutual execution of this
Agreement and the performance by Borrower of all other requirements as set
forth herein, Telehub agrees to make the Loan to Borrower, subject to the
following terms and conditions:
1.1 Terms of Loan. The term of the Loan shall be for a period of
seven (7) years. Interest shall accrue on the Loan for the first three (3) years
and at the end of the three (3) year period, accrued interest shall be added to
the Principal Sum. Commencing on September 1, 2001, interest shall be payable
monthly, amortized over a period of thirty (30) years, with all sums, including
principal and all accrued interest, becoming due and payable on September 1,
2005.
1.2 Interest Rate. The loan shall be made at the rate of interest
of seven percent (7%) per annum, and shall not be readjusted during the term of
the Loan.
1.3 Non-Recourse Loan. No recourse shall be had to Borrower for
payment of principal and/or interest under the Note, and Telehub shall look
solely to the Real Property as security for payment of principal or interest
under the Note. In no event shall Borrower be held
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personally liable for any payment of principal or interest under the
Note or for any Event of Default, as hereinafter defined, under the terms of
this Agreement, the Note or the Deed of Trust (collectively, the "Loan
Document").
1.4 Title Insurance. As a condition precedent to Telehub funding
the Loan, Borrower shall obtain a mortgagee's title insurance policy in the
amount of the Loan with TeleHub as the insured (the "Policy") insuring the Loan
as a valid lien against the Real Property, subject only to the Senior Loan, as
hereinafter defined.
1.5 Improvements. Within one (1) year of obtaining the Loan,
Borrower agrees to invest at least One Hundred Thousand Dollars ($100,000.00)
of his own funds ("Investment") into the Real Property. After this Investment
is made, Borrower will maintain this Investment during the term of the Loan.
1.6 Subordination. The Loan will be subordinate and subject to all
other loans relating to the Real Property (the "Senior Loans"), provided that
the aggregate outstanding balance of the Loan and the Senior Loans, including
all costs and fees associated with the Loan and Senior Loan, does not exceed
the purchase price paid by Borrower for the Real Property. If required,
TeleHub shall execute and deliver any subordination agreement and other
agreement to subordinate the Loan to the Senior Loans in a form reasonably
acceptable to TeleHub.
1.7 Due on Sale. All sums outstanding under the Note shall be
immediately due and payable upon the sale or transfer or refinance of all or any
part of the Real Property, or any interest in the Real Property. A "sale or
transfer" means the conveyance or leasing of the Real Property or any right,
title or interest therein; whether legal, beneficial or equitable; whether
voluntary or involuntary; whether by outright sale, deed, installment sale
contract, land contract, leasehold interest, lease-option contract, or by any
other method of conveyance.
1.8 Additional Loan. In the event Borrower sells or transfers the
Real Property during the term of the Loan and the Loan becomes immediately due
and payable pursuant to Section 1.7, TeleHub shall re-loan Borrower the sum of
Four Hundred Thousand Dollars ($400,000.00) for an additional seven (7) year
period in accordance with the terms and conditions contained in this Agreement
(the "Second Loan"), excluding this Section 1.8, subject to the following
conditions: (i) no Event of Default shall have occurred under the Loan
Documents which is continuing; (ii) Borrower shall acquire a replacement
property (the "Replacement Property") within one hundred fifty (150) days from
the date of the sale or transfer of the Real Property; and (iii) the Second
Loan is used solely for the acquisition of the Replacement Property.
1.9 Insurance. Throughout the term of the Loan, Borrower shall keep
the Real Property fully insured against hazard and liability in amounts
reasonably required by TeleHub.
2. EVENTS OF DEFAULT. The occurrence of any one or more of the
following events shall constitute an Event of Default by Borrower under this
Agreement:
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2.1 Failure to Pay. If Borrower fails to pay when due and payable
or when declared due and payable, any portion of the Note, whether principal or
interest or otherwise.
2.2 Failure to Perform. If Borrower fails or neglects to perform or
observe any term, provision or condition or breaches any representation,
warranty, covenant or agreement contained in the Loan Documents;
2.3 Levy or Attachment. If any material portion of Borrower's
assets is attached, seized, subject to a writ or distress warrant or is levied
upon or comes into the possession of any judicial officer or assignee.
2.4 Bankruptcy. Involuntary bankruptcy which is not terminated in
sixty (60) days.
2.5 Failure to Invest Equity. Borrower's failure to invest and
maintain at least One Hundred Thousand Dollars ($100,000.00) in equity in the
Real Property during the term of the Loan.
3. RIGHTS AND REMEDIES UPON EVENT OF DEFAULT. Upon the occurrence of an
Event of Default, Telehub may, at its election, without demand or notice of
its election, do any one or more of the following, all of which are authorized
by Borrower: (i) declare all obligations, whether evidenced by the Note, the
Loan Documents or otherwise, immediately due and payable in full, and (ii)
exercise any and all rights and remedies available to Telehub under the Loan
Documents.
4. NOTICE. For purposes of this Agreement, notices, demands and all
other communications provided for in this Agreement shall be in writing and
shall be deemed to have been duly given (i) when hand delivered, (ii) when
received if sent by overnight mail, overnight courier or facsimile
transmission, or (iii) two (2) business days after the date when mailed by
United States certified mail, return receipt requested, postage prepaid,
addressed as follows:
If to Borrower: Xxxxxxx X. Xxxxxx
0000 Xxx-Xxxxx Xxxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
If to Telehub: Telehub Communications Corporation
0000 Xxx-Xxxxx Xxxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
5. MISCELLANEOUS.
5.1 Entire Agreement. This Agreement and the other Loan Documents
contain the entire agreement between the parties with respect to the Loan and
supersede all prior and contemporaneous agreements, representations and
understandings of the parties with respect to the Loan. This Agreement may be
amended only by a written instrument signed by the parties hereto.
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5.2. Further Assurances. Borrower shall promptly execute and deliver all
further instruments and documents, and perform all further actions, as may be
reasonably requested by Telehub in connection with this Agreement.
5.3. Binding Effect. This Agreement shall inure to the benefit of, and be
binding upon, the parties hereto and their respective heirs, legal
representatives, successors and assigns.
5.4. Inconsistencies Among Loan Documents. In the event of any
inconsistencies between the terms of this Agreement and any terms of any of the
other Loan Documents, the terms of this Agreement shall be controlling.
5.5. Choice of Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
Illinois without giving effect to the conflict of laws principles thereof.
5.6 Severability. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability
of any other provision or provisions of this Agreement, which shall remain in
full force and effect.
5.7. Titles and Headings. The titles and headings of sections of this
Agreement are intended for convenience only and shall not in any way affect the
meaning or construction of any provision of this Agreement.
5.8. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument. Facsimile signatures
shall constitute original signatures for all purposes.
IN WITNESS WHEREOF, Telehub has caused its name to be subscribed to this
Agreement by its duly authorized representative and Borrower has executed this
Agreement as of the date and year first above written.
TELEHUB COMMUNICATIONS CORPORATION, a Nevada corporation
By: /s/ X.X. Xxxxxx
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Its: CEO
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"BORROWER"
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
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EXHIBIT A
000 Xxxxxxxx Xxxx
Xxxx Xxxxxx, Xxxxxxxx 00000
