PROMISSORY NOTE
Exhibit 10.13
$
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Crookston, Minnesota | |
Maturity
Date: , 2008
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, 2007 | |
Note Number CD-00 |
FOR VALUE RECEIVED, the undersigned, Agassiz Energy, LLC, a Minnesota limited
liability company, with its principal place of business at 000 Xxxxxx Xxxx 00, Xxxxxx Xxxxxxxxxx
Xxxx, Xxxxxxxxx, Xxxxxxxxx, 00000 (“Borrower”) hereby agrees and
promises to pay to the order of (“Holder”), at or such other place as Holder may from
time to time designate, the principal sum of Dollars ($ ) (the “Principal Balance”) together with
interest on the unpaid principal balance until this Note is fully paid, at the rate of five and
one/quarter percent (5.25%) per annum. Both the principal balance and interest thereon shall be
payable in coin or currency which at the time of payment is legal tender for the payment of
public or private debts in the United States of America.
On
, 2008 (the “Maturity Date”), the entire outstanding Principal Balance, together with
accrued interest shall be due and payable in full.
The outstanding Principal Balance evidenced by this Note may be prepaid in full or in part
without penalty or premium at any time during the term of this Note. Partial prepayments shall
be applied against the outstanding Principal Balance of this Note and shall not extend or
postpone the due date of any subsequent installments or change the amount of such installments
unless Holder shall agree otherwise in writing.
Per diem interest shall be computed on the basis of a three hundred sixty (360) day year
but shall be payable on the actual days elapsed during the term of this Note.
It is agreed that time is of the essence in the performance of this Note. Upon the
occurrence of an event of default in the payment of principal or interest hereon or upon the
occurrence of any other event of default hereunder, Holder shall have the right and option to
declare, upon ten (10) days prior written notice, all remaining unpaid principal and accrued
interest evidenced by this Note immediately due and payable. Holder may exercise this option to
accelerate at any time during the occurrence of any event of default described above regardless
of any forbearance by Holder.
Any payment not made by Borrower within ten (10) days of the due date shall be subject to a
late payment charge equal to five percent (5%) of such payment. The late charge shall apply
individually to all payments past du, there will be no daily
adjustment, and it shall be used to defray the costs of Holder incident to collecting such late payment. This provision shall
not be deemed to excuse a late payment or be deemed a waiver of any other rights Holder may
have,
including the right to declare the entire unpaid principal and interest immediately due and
payable.
All payments made under this Note may, at Xxxxxxxx’s discretion, be applied first to
principal, second to interest, and then to any late charges due hereunder, except that if any
advances made by Xxxxxx due to the occurrence of an event of default hereunder or under the terms
of any instrument securing the Note are not repaid on demand, any moneys received, at the option
of Holder, may first be applied to repay such advances and the balance, if any, shall be applied
on account of any installments then due.
Upon the occurrence of an event of default as described above and if the same is referred to
an attorney for collection or any action at law or in equity is brought with respect hereto,
Borrower shall pay Holder all reasonable expenses and costs of collection, including but not
limited to attorneys’ fees.
Borrower waives presentment for payment, protest and notice of nonpayment and dishonor. From
time to time, without affecting the obligations of Borrower under this Note and without giving
notice to or obtaining the consent of Borrower, and without liability on the part of Holder, Holder
may, at Holder’s option, extend the time for payment of sums due under this Note, reduce payments
thereon, release anyone liable for the payment of any portion of the indebtedness evidenced by this
Note, accept a renewal of the Note, modify the terms and time of payment of the indebtedness
evidenced by this Note, join in any extension or subordination agreement, release any security
given herefor and agree in writing with Borrower to modify the rate of interest or period of
amortization of this Note or change the amounts payable hereunder.
All agreements between Xxxxxx and Borrower are hereby expressly limited so that in no
contingency or event whatsoever, by reason of acceleration of maturity of the indebtedness
evidenced hereby or otherwise, shall the amount paid or agreed to be paid to Holder for the use,
forbearance, loaning or detention of the indebtedness evidenced hereby exceed the maximum
permissible under applicable law. If from any circumstances whatsoever, fulfillment of any
provisions hereof or shall involve transcending the limit of validity prescribed by law, then the
obligation to be fulfilled shall automatically be reduced to the limit of such validity and if
from any circumstances Holder should ever receive as interest an amount which would exceed the
highest lawful rate, such amount which would be in excess of such highest lawful rate shall be
applied to the reduction of the Principal Balance evidenced hereby, to the payment of interest or
returned to Borrower, at the option of Holder. This provision shall control every other provision
of all agreements between Borrower and Holder and shall also be binding upon and available to any
subsequent holder or endorsee of this Note.
No delay or omission on the part of Holder in exercising any right hereunder shall operate as
a waiver of such right or of any other remedy under this Note. A waiver on any one occasion shall
not be construed as a bar to or waiver of any such right or remedy on a future
occasion.
The remedies of Holder, as provided herein, shall be cumulative and concurrent and may be
pursued singularly, successively or together at the sole discretion of Holder and may be exercised
as often as the occasion therefor shall arise.
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Holder warrants, represents and understands that Xxxxxxxx has entered into negotiations with
certain owners of Borrower to obtain additional working capital through loans to the Borrower.
Holder further warrants, represents and understands that the funds provided by Holder to Borrower
in connection with this Note will be placed by Borrower into an interest bearing Certificate of
Deposit held by Borrower with American Federal Bank of Crookston, Minnesota (the “Bank”) in the
amount of Eight Hundred Thousand Dollars ($800,000) in the minimum (the “Minimum”) and One Million
Seven Hundred Fifty Thousand Dollars ($1,750,000) in the maximum (the “Maximum”). Holder further
warrants, represents and understands that if Borrower does not receive the Minimum amount of
loans, then all such funds provided by Holder to Borrower shall be returned to Holder and this
Note shall be cancelled.
Holder warrants, represents and understands that Borrower will use the funds provided by
Xxxxxx and placed into an interest bearing Certificate of Deposit held by Borrower with the Bank to
secure a line of credit with the Bank up to the Maximum amount of loans. Holder further warrants,
represents and understands that the President of Xxxxxxxx, subject to approval by the three (3)
member loan committee consisting of Xxxxx Xxxxxxxxx, Xxxx Xxxxxxxxxx and Xxxxx Xxxxxxxxx, is
authorized and directed to execute and further (a) to borrow from the Bank such amount or amounts
of money as may be made available to the Borrower through the line of credit by the Bank; (b) to
extend or renew the line of credit or any installment of principal or interest thereof; and (c) to
enter into such other financing arrangements while this Note is in effect.
Holder warrants, represents and understands that the Borrower will enter into a security
agreement (the “Security Agreement”) with the Bank which grants the Bank a security interest in
the Certificate of Deposit held by the Borrower with the Bank and funded by the Holder and other
certain owners of Borrower. Holder further warrants, represents and understands that except for
the Bank’s security interest in the Certificate of Deposit held by Borrower with the Bank, and
each other Note issued by Borrower (which shall be on a pari passu basis with this Note) this Note
is superior to any and all other debts, liens and amounts owed of Borrower. Borrower hereby grants
a security interest in all of its assets to Borrower. Holder further warrants, represents and
understands the funds provided to Borrower by Holder are at risk and that the Borrower cannot and
does not guaranty repayment of this Note.
IN WITNESS WHEREOF, the undersigned has executed this Note as of the day and
year first above written.
| AGASSIZ ENERGY, LLC |
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| By: | ||||
| Xxxxxx Xxxxxxxx, President | ||||
[CONTINUED ON NEXT PAGE]
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HOLDER ACKNOWLEDGEMENT:
Holder hereby represents and acknowledges that Xxxxxx has read and understands the terms and
provisions of this Promissory Note and agrees to provide by the provisions herein.
If Entity, please state title |
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