PROMISSORY NOTE
Principal Loan Date Maturity Loan No Call / Coll Account Officer Initials
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$1,421,000.00 08-21-2001 08-24-2026 3600039904 01
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References in the shaded area are for Lender's use only and do not limit the applicability of
this document to any particular loan or item. Any item above containing "***" has been omitted
due to text length limitations.
Borrower: Eldorado Artesian Springs, Inc. (TIN: ▇▇-▇▇▇▇▇▇▇) P.O. Box 445
Eldorado Springs, CO 80025
Lender: Bank of the West
Secondary Marketing
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
P.0. Box 61000
Truckee, CA 96160
Principal Amount: $1,421,000.00 Initial Rate: 7.500% Date of Note: August 21, 2001
PROMISE TO PAY. Eldorado Artesian Springs. Inc. (Borrower") promises to pay to
Bank of the West ("Lender"), or order, in lawful money of the United States of
America, the principal amount of One Million Four Hundred Twenty-one Thousand &
00/100 Dollars ($1,421,000.00), together with interest on the unpaid principal
balance from August 24, 2001, until paid in full.
PAYMENT. Subject to any payment changes resulting from changes in the Index,
Borrower will pay this loan in 300 payments of $10,602.33 each payment.
▇▇▇▇▇▇▇▇'s first payment is due September 24, 2001, and all subsequent payments
are due on the same day of each month after that. ▇▇▇▇▇▇▇▇'s final payment will
be due on August 24, 2026, `and will be for all principal and all accrued
interest not yet paid. Payments include principal and interest. Unless otherwise
agreed or required by applicable law, payments will be applied first to accrued
unpaid interest, then to principal, and any remaining amount to any unpaid
collection costs and late charges. The annual interest rate for this Note is
computed on a 365/360 basis; that is, by applying the ratio of the annual
interest rate over a year of 360 days, multiplied by the outstanding principal
balance, multiplied by the actual number of days the principal balance is
outstanding. Borrower will pay Lender at ▇▇▇▇▇▇'s address shown above or at such
other place as Lender may designate in writing.
VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from
time to time based on changes in an independent index, which is the Prime Rate
as published in the Wall Street Journal (the "Index"). The Index is not
necessarily the lowest rate charged by Lender on its loans. If the Index becomes
unavailable during the term of this loan, Lender may designate a substitute
index after notice to Borrower. Lender will tell Borrower the current Index rate
upon ▇▇▇▇▇▇▇▇'s request. The interest rate change will not occur more often than
each month. Borrower understands that Lender may make loans based on other rates
as well. The Index currently is 6.750% per annum. The interest rate to be
applied to the unpaid principal balance of this Note will be at a rate of 0.750
percentage points over the Index, resulting in an initial rate of 7.500% per
annum. NOTICE: Under no circumstances will the interest rate on this Note be
more than the maximum rate allowed by applicable law. Whenever increases occur
in the interest rate, Lender, at its option, may do one or more of the
following: (A) increase Borrower's payments to ensure Borrower's loan will pay
off by its original final maturity date, (B) increase Borrower's payments to
cover accruing interest, (C) increase the number of Borrower's payments, and (D)
continue Borrower's payments at the same amount and increase Borrower's final
payment.
PREPAYMENT PENALTY. Upon prepayment of this Note, ▇▇▇▇▇▇ is entitled to the
following prepayment penalty: ▇▇▇▇▇▇▇▇ agrees that all loan fees and other
prepaid finance charges are earned fully as of the date of the loan and will not
be subject to refund upon early payment (whether voluntary or as a result of
default), except as otherwise required by law. Upon prepayment of the Note,
▇▇▇▇▇▇ is entitled to the following prepayment penalty: Any prepayment in full
is subject to a prepayment penalty of five percent (5%) of the outstanding loan
balance if said payment is received during the first year of the loan,
decreasing by one percent (1%) each year until the end of year five, at which
time the prepayment penalty provision expires. No partial prepayments may be
made during the prepayment period. Except for the foregoing, Borrower may pay
all or a portion of the amount owed earlier than it is due. Early payments will
not, unless agreed to by ▇▇▇▇▇▇ in writing, relieve ▇▇▇▇▇▇▇▇ of ▇▇▇▇▇▇▇▇'s
obligation to continue to make payments under the payment schedule. Rather,
early payments will reduce the principal balance due and may result in
Borrower's making fewer payments. ▇▇▇▇▇▇▇▇ agrees not to send Lender payments
marked "paid in full", "without recourse", or similar language. If Borrower
sends such a payment, ▇▇▇▇▇▇ may accept it without losing any of ▇▇▇▇▇▇'s rights
under this Note, and Borrower will remain obligated to pay any further amount
owed to Lender. All written communications concerning disputed amounts,
including any check or other payment instrument that indicates that the payment
constitutes "payment in full" of the amount owed or that is tendered with other
conditions or limitations or as full satisfaction of a disputed amount must be
mailed or delivered to: Bank of the West , Secondary Marketing, ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇, ▇. ▇. Box 61000, Truckee, CA 96160.
LATE CHARGE. If a payment is 10 days or more late, Borrower will be charged
5.000% of the unpaid portion of the regularly scheduled payment or $15.00,
whichever is greater.
INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final
maturity, at ▇▇▇▇▇▇'s option, and if permitted by applicable law, Lender may add
any unpaid accrued interest to principal and such sum will bear interest
therefrom until paid at the rate provided in this Note (including any increased
rate). Upon default, Lender, at its option, may, if permitted under applicable
law, increase the variable interest rate on this Note to 5.750 percentage points
over the Index. The interest rate will not exceed the maximum rate permitted by
applicable law.
DEFAULT. Each of the following shall constitute an event of default ("Event of
Default") under this Note:
Payment Default. Borrower fails to make any payment when due under this Note.
Other Defaults. Borrower fails to comply with or to perform any other term,
obligation, covenant or condition contained in this Note or in any of the
related documents or to comply with or to perform any term, obligation, covenant
or condition contained in any other agreement between Lender and Borrower.
Environmental Default. Failure of any party to comply with or perform when due
any term, obligation, convenant or condition contained in any environmental
agreement executed in connection with any loan.
False Statements. Any warranty, representation or statement made or furnished to
Lender by Borrower or on Borrower's behalf under this Note or the related
documents is false or misleading in any material respect, either now or at the
time made or furnished or becomes false or misleading at any time thereafter.
Insolvency. The dissolution or termination of ▇▇▇▇▇▇▇▇'s existence as a going
business, the insolvency of ▇▇▇▇▇▇▇▇, the appointment of a receiver for any part
of ▇▇▇▇▇▇▇▇'s property, any assignment for the benefit of creditors, any type of
creditor workout, or the commencement of any proceeding under any bankruptcy or
insolvency laws by or against Borrower.
Creditor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture
proceedings, whether by judicial proceeding, self-help, repossession or any
other method, by any creditor of Borrower or by any governmental agency against
any collateral securing the loan. This includes a garnishment of any of
▇▇▇▇▇▇▇▇'s accounts, including deposit accounts, with Lender. However, this
Event of Default shall not apply if there is a good faith dispute by ▇▇▇▇▇▇▇▇ as
to the validity or reasonableness of the claim which is the basis of the
creditor or forfeiture proceeding and if Borrower gives ▇▇▇▇▇▇ written notice of
the creditor or forfeiture proceeding and deposits with Lender monies or a
surety bond for the creditor or forfeiture proceeding, in an amount determined
by Lender, in its sole discretion, as being an adequate reserve or bond for the
dispute.
Events Affecting Guarantor. Any of the preceding events occurs with respect to
any Guarantor of any of the indebtedness or any Guarantor dies or becomes
incompetent, or revokes or disputes the validity of, or liability under, any
guaranty of the indebtedness evidenced by this Note. in the event of a death,
Lender, at its option, may, but shall not be required to, permit the Guarantor's
estate to assume unconditionally the obligations arising under the guaranty in a
manner satisfactory to Lender, and, in doing so, cure any Event of Default.
Change in Ownership. Any change in ownership of twenty-five percent (25%) or
more of the common stock of Borrower.
Adverse Change. A material adverse change occurs in Borrower's financial
condition, or ▇▇▇▇▇▇ believes the prospect of payment or performance of this
Note is impaired.
Insecurity. Lender in good faith believes itself insecure.
Cure Provisions. If any default, other than a default in payment is curable and
if Borrower has not been given a notice of a breach of the same provision of
this Note within the preceding twelve (12) months, it may be cured land no event
of default will have occurred) if Borrower, after receiving written notice from
Lender demanding cure of such default: (1) cures the default within thirty (30)
days; or (2) if the cure requires more than thirty (30) days, immediately
initiates steps which Lender deems in ▇▇▇▇▇▇'s sole discretion to be sufficient
to cure the default and thereafter continues and completes all reasonable and
necessary steps sufficient to produce compliance as soon as reasonably
practical.
LENDER'S RIGHTS. Upon default, ▇▇▇▇▇▇ may declare the entire unpaid principal
balance on this Note and all accrued unpaid interest immediately due, and then
Borrower will pay that amount.
ATTORNEYS' FEES; EXPENSES. Lender may hire or pay someone else to help collect
this Note if Borrower does not pay. Borrower will pay Lender that amount. This
includes, subject to any limits under applicable law, ▇▇▇▇▇▇'s attorneys' fees
and ▇▇▇▇▇▇'s legal expenses, whether or not there is a lawsuit, including
without limitation all attorneys' fees and legal expenses for bankruptcy
proceedings (including efforts to modify or vacate any automatic stay or
injunction), and appeals. If not prohibited by applicable law, Borrower also
will pay any court costs, in addition to a)) other sums provided by law.
GOVERNING LAW. This Note will be governed by, construed and enforced in
accordance with federal law and the laws of the State of Colorado. This Note has
been accepted by ▇▇▇▇▇▇ in the State of Colorado.
CHOICE OF VENUE. If there is a lawsuit, ▇▇▇▇▇▇▇▇ agrees upon ▇▇▇▇▇▇'s request to
submit to the jurisdiction of the courts of Boulder County, State of Colorado.
RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a
right of setoff in all Borrowers' accounts with Lender (whether checking,
savings, or some other account). This includes a)) accounts Borrower holds
jointly with someone else and all accounts Borrower may open in the future.
However, this does not include any IRA or ▇▇▇▇▇ accounts, or any trust accounts
for which setoff would be prohibited by law. Borrower authorizes ▇▇▇▇▇▇, to the
extent permitted by applicable law, to charge or setoff all sums owing on the
indebtedness against any and a)) such accounts.
COLLATERAL. Borrower acknowledges this Note is secured by a Deed of Trust dated
August 21, 2001, to the Public Trustee for the benefit of Lender on real
property located in Boulder County, State of Colorado, all the terms and
conditions of which are hereby incorporated and made a part of this Note; an
Assignment of All Rents to Lender on real property located in Boulder County,
State of Colorado, all the terms and conditions of which are hereby incorporated
and made a part of this Note
SUCCESSOR INTERESTS. The terms of this Note shall be binding upon ▇▇▇▇▇▇▇▇, and
upon ▇▇▇▇▇▇▇▇'s heirs, personal representatives, successors and assigns, and
shall inure to the benefit of Lender and its successors and assigns.
NOTIFY US OF INACCURATE INFORMATION WE REPORT TO CONSUMER REPORTING AGENCIES.
Please notify us if we report any inaccurate information about your account(s)
to a consumer reporting agency. Your written notice describing the specific
inaccuracy(ies) should be sent to us at the following address: Bank of the West
P. 0. Box 61000 Truckee, CA 96160
GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights or
remedies under this Note without losing them. Borrower and any other person who
signs, guarantees or endorses this Note, to the extent allowed by law, waive
presentment, demand for payment, and notice of dishonor. Upon any change in the
terms of this Note, and unless otherwise expressly stated in writing, no party
who signs this Note, whether as maker, guarantor, accommodation maker or
endorser, shall be released from liability. All such parties agree that Lender
may renew or extend (repeatedly and for any length of time) this loan or release
any party or guarantor or collateral; or impair, fail to realize upon or perfect
▇▇▇▇▇▇'s security interest in the collateral; and take any other action deemed
necessary by ▇▇▇▇▇▇ without the consent of or notice to anyone. Al) such parties
also agree that ▇▇▇▇▇▇ may modify this loan without the consent of or notice to
anyone other than the party with whom the modification is made. The obligations
under this Note are joint and several.
PRIOR TO SIGNING THIS NOTE, ▇▇▇▇▇▇▇▇ READ AND UNDERSTOOD ALL THE PROVISIONS OF
THIS NOTE. INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. ▇▇▇▇▇▇▇▇ AGREES TO
THE TERMS OF THE NOTE.
BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE.
BORROWER:
ELDORADO ARTESIAN SPRINGS, INC.
By:/s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President of Eldorado Artesian Springs, Inc
By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Secretary of Eldorado Artesian Springs, Inc
By:/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President of Eldorado Artesian Springs, Inc
CORPORATE RESOLUTION TO BORROW / GRANT COLLATERAL
Principal Loan Date Maturity Loan No Call / Coll Account Officer Initials
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$1,421,000.00 08-21-2001 08-24-2026 3600039904 01
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References in the shaded area are for Lender's use only and do not limit the applicability of
this document to any particular loan or item. Any item above containing "***" has been omitted
due to text length limitations.
Borrower: Eldorado Artesian Springs, Inc. (TIN: ▇▇-▇▇▇▇▇▇▇)
P.O. Box 445
Eldorado Springs, CO 80025
Lender: Bank of the West
Secondary Marketing
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
P.0. Box 61000
Truckee, CA 96160
I, THE UNDERSIGNED, DO HEREBY CERTIFY THAT:
THE CORPORATION'S EXISTENCE. The complete and correct name of the Corporation is
Eldorado Artesian Springs, Inc. ("Corporation"). The Corporation is a
corporation for profit which is, and at all times shall be, duly organized,
validly existing, and in good standing under and by virtue of the laws of the
State of Colorado. The Corporation is duly authorized to transact business in
all other states in which the Corporation is doing business, having obtained a))
necessary filings, governmental licenses and approvals for each state in which
the Corporation is doing business. Specifically, the Corporation is, and at all
times shall be, duly qualified as a foreign corporation in all states in which
the failure to so qualify would have a material adverse effect on its business
or financial condition. The Corporation has the full power and authority to own
its properties and to transact the business in which it is presently engaged or
presently proposes to engage. The Corporation maintains its principal office at
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇▇▇▇▇, ▇▇. Unless the Corporation has designated
otherwise in writing, this is the principal office at which the Corporation
keeps its books and records. The Corporation will notify Lender prior to any
change in the location of the Corporation's state of organization or any change
in the Corporation's name. The Corporation shall do a)) things necessary to
preserve and to keep in full force and effect its existence, rights and
privileges, and shall comply with all regulations, rules, ordinances, statutes,
orders and decrees of any governmental or quasi-governmental authority or court
applicable to the Corporation and the Corporation's business activities.
RESOLUTIONS ADOPTED. At a meeting of the Directors of the Corporation, or if the
Corporation is a close corporation having no Board of Directors then at a
meeting of the Corporation's shareholders, duly called and held on August 21,
2001, at which a quorum was present and voting, or by other duly authorized
action in lieu of a meeting, the resolutions set forth in this Resolution were
adopted.
OFFICERS. The following named persons are officers of Eldorado Artesian Springs, Inc.:
NAMES TITLES AUTHORIZED ACTUAL SIGNATURES
----- ------ ---------- -----------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ President Y
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Vice President Y
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Secretary Y
ACTIONS AUTHORIZED. Any three (3) of the authorized persons listed above may
enter into any agreements of any nature with Lender, and those agreements will
bind the Corporation. Specifically, but without limitation, any three (3) of
such authorized persons are authorized, empowered, and directed to do the
following for and on behalf of the Corporation:
Borrow Money. To borrow, as a cosigner or otherwise, from time to time from
Lender, on such terms as may be agreed upon between the Corporation and
Lender, such sum or sums of money as in their judgment should be borrowed,
without limitation.
Execute Notes. To execute and deliver to Lender the promissory note or
notes, or other evidence of the Corporation's credit accommodations, on
Lender's forms, at such rates of interest and on such terms as may be
agreed upon, evidencing the sums of money so borrowed or any of the
Corporation's indebtedness to Lender, and also to execute and deliver to
Lender one or more renewals, extensions, modifications, refinancings,
consolidations, or substitutions for one or more of the notes, any portion
of the notes, or any other evidence of credit accommodations.
Grant Security. To mortgage, pledge, transfer, endorse, hypothecate, or
otherwise encumber and deliver to Lender any property now or hereafter
belonging to the Corporation or in which the Corporation now or hereafter
may have an interest, including without limitation all real property and
all personal property (tangible or intangible) of the Corporation, as
security for the payment of any loans or credit accommodations so obtained,
any promissory notes so executed (including any amendments to or
modifications, renewals, and extensions of such promissory notes), or any
other or further indebtedness of the Corporation to Lender at any time
owing, however the same may be evidenced. Such property may be mortgaged,
pledged, transferred, endorsed, hypothecated or encumbered at the time such
loans are obtained or such indebtedness is incurred, or at any other time
or times, and may be either in addition to or in lieu of any property
theretofore mortgaged, pledged, transferred, endorsed, hypothecated or
encumbered.
Execute Security Documents. To execute and deliver to Lender the forms of
mortgage, deed of trust, pledge agreement, hypothecation agreement, and
other security agreements and financing statements which Lender may require
and which shall evidence the terms and conditions under and pursuant to
which such liens and encumbrances, or any of them, are given; and also to
execute and deliver to Lender any other written instruments, any chattel
paper, or any other collateral, of any kind or nature, which Lender may
deem necessary or proper in connection with or pertaining to the giving of
the liens and encumbrances. Notwithstanding the foregoing, any one of the
above authorized persons may execute, deliver, or record financing
statements.
Negotiate Items. To draw, endorse, and discount with Lender all drafts,
trade acceptances, promissory notes, or other evidences of indebtedness
payable to or belonging to the Corporation or in which the Corporation may
have an interest, and either to receive cash for the same or to cause such
proceeds to be credited to the Corporation's account with ▇▇▇▇▇▇, or to
cause such other disposition of the proceeds derived therefrom as they may
deem advisable.
Further Acts. In the case of lines of credit, to designate additional or
alternate individuals as being authorized to request advances under such
lines, and in all cases, to do and perform such other acts and things, to
pay any and all fees and costs, and to execute and deliver such other
documents and agreements as the officers may in their discretion deem
reasonably necessary or proper in order to carry into effect the provisions
of this Resolution.
ASSUMED BUSINESS NAMES. The Corporation has filed or recorded a)) documents or
filings required by law relating to a)) assumed business names used by the
Corporation. Excluding the name of the Corporation, the following is a complete
list of all assumed business names under which the Corporation does business:
None.
BUSINESS LOAN AGREEMENT
Principal Loan Date Maturity Loan No Call/ Coll Account Officer Initials
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$1 421.000.00 08.21-2001 08-24-2026 3600039904 01
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References in the shaded area are for Lender's use only and do not limit the applicability of
this document to any particular loan or item.
Any item above containing "***" has been omitted due to text length limitations.
Borrower: Eldorado Artesian Springs, Inc. (TIN: ▇▇-▇▇▇▇▇▇▇) Lender: Bank of the West
P.O. Box 445 Secondary Marketing
Eldorado Springs, CO 80025 ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
P. 0. Box 61000
Truckee, CA 96160
THIS BUSINESS LOAN AGREEMENT dated August 21, 2001, is made and executed between
Eldorado Artesian Springs, Inc. ("Borrower") and Bank of the West ("Lender") on
the following terms and conditions. Borrower has received prior commercial loans
from Lender or has applied to Lender for a commercial loan or loans or other
financial accommodations, including those, which may be described on any exhibit
or schedule, attached to this Agreement ("Loan"). ▇▇▇▇▇▇▇▇ understands and
agrees that: (A) in granting, renewing, or extending any Loan. Lender is relying
upon Borrower's representations, warranties, and agreements as set forth in this
Agreement, and (B) all such Loans shall be and remain subject to the terms and
conditions of this Agreement.
TERM. This Agreement shall be effective as of August 21, 2001, and shall
continue in full force and effect until such time me as all of Borrower's Loans
in favor of Lender have been paid in full, including principal, interest, costs,
expenses, attorneys fees, and other fees and charges, or until August 24, 2026.
CONDITIONS PRECEDENT TO EACH ADVANCE. Lender's obligation to make the initial
Advance and each subsequent Advance under this Agreement shall be subject to the
fulfillment to ▇▇▇▇▇▇'s satisfaction of all of the conditions set forth in this
Agreement and in the Related Documents.
Loan Documents. Borrower shall provide to Lender the following documents
for the Loan: (1) the Note; (2) Security Agreements granting to Lender
security interests in the Collateral; (3) financing statements and all
other documents perfecting Lender's Security Interests; (4) evidence of
insurance as required below; (5) guaranties; (6) together with all such
Related Documents as Lender may require for the Loan; all in form and
substance satisfactory to Lender and ▇▇▇▇▇▇'s counsel.
Borrower's Authorization. Borrower shall have provided in form and
substance satisfactory to Lender properly certified resolutions, duly
authorizing the execution delivery of this Agreement the Note and the
Related Documents. In addition, Borrower shall have provided such other
resolutions, authorizations, documents and instruments as Lender or its
counsel, may require.
Payment of Fees and Expenses. Borrower shall have paid to Lender all fees,
charges, and other expenses, which are then due and payable as specified in
this Agreement or any Related Document.
Representations and Warranties. The representations and warranties set
forth in this Agreement, in the Related Documents, and in any document or
certificate delivered to Lender under this Agreement are true and correct.
No Event of Default. There shall not exist at the time of any Advance a
condition which would constitute an Event of Default under this Agreement
or under any Related Document.
REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants to Lender, as
of the date of this Agreement, as of the date of each disbursement of loan
proceeds, as of the date of any renewal, extension or modification of any Loan,
and at all times any Indebtedness exists:
Organization. Borrower is a corporation for profit which is, and at all
times shall be, duly organized, validly existing, and in good standing
under and by virtue of the laws of the State of Colorado. Borrower is duly
authorized to transact business in all other states in which Borrower is
doing business, having obtained all necessary filings, governmental
licenses and approvals for each state in which Borrower is doing business.
Specifically, Borrower is, and at all times shall be, duly qualified as a
foreign corporation in all states in which the failure to so qualify would
have a material adverse effect on its business or financial condition.
Borrower has the full power and authority to own its properties and to
transact the business in which it is presently engaged or presently
proposes to engage. Borrower maintains its principal office at ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇., ▇▇▇▇▇▇▇▇▇▇, ▇▇. Unless Borrower has designated otherwise in writing,
this is the principal office at which Borrower keeps its books and records
including its records concerning the Collateral. Borrower will notify
Lender prior to any change in the location of ▇▇▇▇▇▇▇▇'s state of
organization or any change in Borrower's name. Borrower shall do all things
necessary to preserve and to keep in full force and effect its existence,
rights and privileges, and shall comply with all regulations, rules,
ordinances, statutes, orders and decrees of any governmental or
quasi-governmental authority or court applicable to Borrower and ▇▇▇▇▇▇▇▇'s
business activities.
Assumed Business Names. ▇▇▇▇▇▇▇▇ has filed or recorded all documents or
filings required by law relating to all assumed business names used by
▇▇▇▇▇▇▇▇. Excluding the name of ▇▇▇▇▇▇▇▇, the following is a complete list
of all assumed business names under which Borrower does business: None.
Authorization. ▇▇▇▇▇▇▇▇'s execution, delivery, and performance of this
Agreement and all the Related Documents have been duly authorized by all
necessary action by Borrower and do not conflict with, result in a
violation of, or constitute a default under (1) any provision of Borrower's
articles of incorporation or organization, or bylaws, or any agreement or
other instrument binding upon Borrower or 12) any law, governmental
regulation, court decree, or order applicable to Borrower or to Borrower's
properties.
Financial Information. Each of ▇▇▇▇▇▇▇▇'s financial statements supplied to
▇▇▇▇▇▇ truly and completely disclosed ▇▇▇▇▇▇▇▇'s financial condition as of
the date of the statement, and there has been no material adverse change in
▇▇▇▇▇▇▇▇'s financial condition subsequent to the date of the most recent
financial statement supplied to Lender. Borrower has no material contingent
obligations except as disclosed in such financial statements.
Legal Effect. This Agreement constitutes, and any instrument or agreement
Borrower is required to give under this Agreement when delivered will
constitute legal, valid, and binding obligations of Borrower enforceable
against Borrower in accordance with their respective terms.
Properties. Except as contemplated by this Agreement or as previously
disclosed in ▇▇▇▇▇▇▇▇'s financial statements or in writing to Lender and as
accepted by ▇▇▇▇▇▇, and except for property tax liens for taxes not
presently due and payable, Borrower owns and has good title to all of
Borrower's properties free and clear of all Security Interests, and has not
executed any security documents or financing statements relating to such
properties. All of ▇▇▇▇▇▇▇▇'s properties are title in ▇▇▇▇▇▇▇▇'s name, and
▇▇▇▇▇▇▇▇ has not used, or filed a financing statement under, any other name
for at least the last five (5) years.
Hazardous Substances. Except as disclosed to and acknowledged by ▇▇▇▇▇▇ in
writing, Borrower represents and warrants that: (1) During the period of
Borrower's ownership of Borrower's Collateral, there has been no use,
generation, manufacture, storage, treatment, disposal, release or
threatened release of any Hazardous Substance by any person on, under,
about or from any of the Collateral. 12) Borrower has no knowledge of, or
reason to believe that there has been (a) any breach or violation of any
Environmental Laws; (b) any use, generation, manufacture, storage,
treatment, disposal, release or threatened release of any Hazardous
Substance on, under, about or from the Collateral by any prior owners or
occupants of any of the Collateral; or (c) any actual or threatened
litigation or claims of any kind by any person relating to such matters.
(3) Neither Borrower nor any tenant, contractor, agent or other authorized
user of any of the Collateral shall use, generate, manufacture, store,
treat, dispose of or release any Hazardous Substance on, under, about or
from any of the Collateral; and any such activity shall be conducted in
compliance with all applicable federal, state, and local laws, regulations,
and ordinances, including without limitation all Environmental Laws.
Borrower authorizes Lender and its agents to enter upon the Collateral to
make such inspections and tests as Lender may deem appropriate to determine
compliance of the Collateral with this section of the Agreement. Any
inspections or tests made by Lender shall be at Borrower's expense and for
Lender's purposes only and shall not be construed to create any
responsibility or liability on the part of Lender to Borrower or to any
other person. The representations and warranties contained herein are based
on Borrower's due diligence in investigating the Collateral for hazardous
waste and Hazardous Substances. Borrower hereby (1) releases and waives any
future claims against Lender for indemnity or contribution in the event
Borrower becomes liable for cleanup or other costs under any such laws, and
(2) agrees to indemnify and hold harmless Lender against any and all
claims, losses, liabilities, damages, penalties, and expenses which Lender
may directly or indirectly sustain or suffer resulting from a breach of
this section of the Agreement or as a consequence of any use, generation,
manufacture, storage, disposal, release or threatened release of a
hazardous waste or substance on the Collateral. The provisions of this
section of the Agreement, including the obligation to indemnify, shall
survive the payment of the Indebtedness and the termination, expiration or
satisfaction of this Agreement and shall not be affected by ▇▇▇▇▇▇'s
acquisition of any interest in any of the Collateral, whether by
foreclosure or otherwise.
Litigation and Claims. No litigation, claim, investigation, administrative
proceeding or similar action including those for unpaid taxes) against
Borrower is pending or threatened, and no other event has occurred which
may materially adversely affect Borrower's financial condition or
properties, other than litigation, claims, or other events, if any, that
have been disclosed to and acknowledged by ▇▇▇▇▇▇ in writing.
Taxes. To the best of ▇▇▇▇▇▇▇▇'s knowledge, all of ▇▇▇▇▇▇▇▇'s tax returns
and reports that are or were required to be filed, have been filed, and all
taxes, assessments and other governmental charges have been paid in full,
except those presently being or to be contested by Borrower in good faith
in the ordinary course of business and for which adequate reserves have
been provided.
Lien Priority. Unless otherwise previously disclosed to Lender in writing,
▇▇▇▇▇▇▇▇ has not entered into or granted any Security Agreements, or
permitted the filing or attachment of any Security Interests on or
affecting any of the Collateral directly or indirectly securing repayment
of Borrower's Loan and Note, that would be prior or that may in any way be
superior to ▇▇▇▇▇▇'s Security Interests and rights in and to such
Collateral.
Binding Effect. This Agreement, the Note, all Security Agreements (if any),
and a)) Related Documents are binding upon the signers thereof, as well as
upon their successors, representatives and assigns, and are legally
enforceable in accordance with their respective terms.
AFFIRMATIVE COVENANTS. Borrower covenants and agrees with ▇▇▇▇▇▇ that, so long
as this Agreement remains in effect, Borrower will:
Notices of Claims and Litigation. Promptly inform ▇▇▇▇▇▇ in writing of (1)
all material adverse changes in Borrower's financial condition, and (2) all
existing and all threatened litigation, claims, investigations,
administrative proceedings or similar actions affecting Borrower or any
Guarantor which could materially affect the financial condition of Borrower
or the financial condition of any Guarantor.
Financial Records. Maintain its books and records in accordance with GAAP,
applied on a consistent basis, and permit ▇▇▇▇▇▇ to examine and audit
▇▇▇▇▇▇▇▇'s books and records at all reasonable times.
Financial Statements. Furnish Lender with such financial statements and
other related information at such frequencies and in such detail as Lender
may reasonably request.
Additional Information. Furnish such additional information and statements,
as ▇▇▇▇▇▇ may request from time to time.
Insurance. Maintain fire and other risk insurance, public liability
insurance, and such other insurance as Lender may require with respect to
Borrower's properties and operations, in form, amounts, coverages and with
insurance companies acceptable to Lender. Borrower, upon request of ▇▇▇▇▇▇,
will deliver to Lender from time to time the policies or certificates of
insurance in form satisfactory to Lender, including stipulations that
coverages will not be cancelled or diminished without at least ten (10)
days prior written notice to Lender. Each insurance policy also shall
include an endorsement providing that coverage in favor of Lender will not
be impaired in any way by any act, omission or default of Borrower or any
other person, in connection with all policies covering assets in which
Lender holds or is offered a security interest for the Loans, Borrower will
provide Lender with such lender's loss payable or other endorsements as
Lender may require.
Insurance Reports. Furnish to Lender, upon request of Lender, reports on
each existing insurance policy showing such information as Lender may
reasonably request, including without limitation the following: (1) the
name of the insurer; (2) the risks insured; (3) the amount of the policy;
(4) the properties insured; 15) the then current property values on the
basis of which insurance has been obtained, and the manner of determining
those values; and (6) the expiration date of the policy. ln addition, upon
request of Lender (however not more often than annually), Borrower will
have an independent appraiser satisfactory to Lender determine, as
applicable, the actual cash value or replacement cost of any Collateral.
The cost of such appraisal shall be paid by Borrower.
Guaranties. Prior to disbursement of any Loan proceeds, furnish executed
guaranties of the Loans in favor of ▇▇▇▇▇▇, executed by the guarantors
named below, on ▇▇▇▇▇▇'s forms, and in the amounts and under the conditions
set forth in those guaranties.
Names of Guarantors Amounts
------------------- -------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ $1,421,000.00
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ $1,421,000.00
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ $1,421,000.00
Other Agreements. Comply with all terms and conditions of a)) other
agreements, whether now or hereafter existing, between Borrower and any
other party and notify Lender immediately in writing of any default in
connection with any other such agreements.
Loan Proceeds. Use all Loan proceeds solely for ▇▇▇▇▇▇▇▇'s business
operations, unless specifically consented to the contrary by ▇▇▇▇▇▇ in
writing.
Taxes, Charges and Liens. Pay and discharge when due all of its
indebtedness and obligations, including without limitation all assessments,
taxes, governmental charges, levies and liens, of every kind and nature,
imposed upon Borrower or its properties, income, or profits, prior to the
date on which penalties would attach, and all lawful claims that, if
unpaid, might become a lien or charge upon any of Borrower's properties,
income, or profits.
Performance. Perform and comply, in a timely manner, with all terms,
conditions, and provisions set forth in this Agreement, in the Related
Documents, and in all other instruments and agreements between Borrower and
Lender. Borrower shall notify ▇▇▇▇▇▇ immediately in writing of any default
in connection with any agreement.
Operations. Maintain executive and management personnel with substantially
the same qualifications and experience as the present executive and
management personnel; provide written notice to Lender of any change in
executive and management personnel; conduct its business affairs in a
reasonable and prudent manner.
Environmental Studies. Promptly conduct and complete, at Borrower's
expense, all such investigations, studies, samplings and testings as may be
requested by Lender or any governmental authority relative to any
substance, or any waste or by-product of any substance defined as toxic or
a hazardous substance under applicable federal, state, or local law, rule,
regulation, order or directive, at or affecting any property or any
facility owned, leased or used by Borrower.
Compliance with Governmental Requirements. Comply with all laws,
ordinances, and regulations, now or hereafter in effect, of all
governmental authorities applicable to the conduct of Borrower's
properties, businesses and operations, and to the use or occupancy of the
Collateral, including without limitation, the Americans With Disabilities
Act. Borrower may contest in good faith any such law, ordinance, or
regulation and withhold compliance during any proceeding, including
appropriate appeals, so long as Borrower has notified Lender in writing
prior to doing so and so long as, in ▇▇▇▇▇▇'s sole opinion, ▇▇▇▇▇▇'s
interests in the Collateral are not jeopardized. Lender may require
Borrower to post adequate security or a surety bond, reasonably
satisfactory to Lender, to protect ▇▇▇▇▇▇'s interest.
Inspection. Permit employees or agents of Lender at any reasonable time to
inspect any and a)) Collateral for the Loan or Loans and ▇▇▇▇▇▇▇▇'s other
properties and to examine or audit ▇▇▇▇▇▇▇▇'s books, accounts, and records
and to make copies and memoranda of ▇▇▇▇▇▇▇▇'s books, accounts, and
records. If Borrower now or at any time hereafter maintains any records
(including without limitation computer generated records and computer
software programs for the generation of such records) in the possession of
a third party, Borrower, upon request of ▇▇▇▇▇▇, shall notify such party to
permit Lender free access to such records at all reasonable times and to
provide Lender with copies of any records it may request, all at Borrower's
expense.
Compliance Certificates. Unless waived in writing by ▇▇▇▇▇▇, provide Lender
at least annually, with a certificate executed by ▇▇▇▇▇▇▇▇'s chief
financial officer, or other officer or person acceptable to Lender,
certifying that the representations and warranties set forth in this
Agreement are true and correct as of the date of the certificate and
further certifying that, as of the date of the certificate, no Event of
Default exists under this Agreement.
Environmental Compliance and Reports. Borrower shall comply in all respects
with any and all Environmental Laws; not cause or permit to exist, as a
result of an intentional or unintentional action or omission on Borrower's
part or on the part of any third party, on property owned and/or occupied
by Borrower, any environmental activity where damage may result to the
environment, unless such environmental activity is pursuant to and in
compliance with the conditions of a permit issued by the appropriate
federal, state or local governmental authorities; shall furnish to Lender
promptly and in any event within thirty (30) days after receipt thereof a
copy of any notice, summons, lien, citation, directive, letter or other
communication from any governmental agency or instrumentality concerning
any intentional or unintentional action or omission on Borrower's part in
connection with any environmental activity whether or not there is damage
to the environment and/or other natural resources.
Additional Assurances. Make, execute and deliver to Lender such promissory
notes, mortgages, deeds of trust, security agreements, assignments,
financing statements, instruments, documents and other agreements as Lender
or its attorneys may reasonably request to evidence and secure the Loans
and to perfect all Security Interests.
RECOVERY OF ADDITIONAL COSTS. If the imposition of or any change in any law,
rule, regulation or guideline, or the interpretation or application of any
thereof by any court or administrative or governmental authority (including any
request or policy not having the force of law) shall impose, modify or make
applicable any taxes (except federal, state or local income or franchise taxes
imposed on Lender), reserve requirements, capital adequacy requirements or other
obligations which would (Al increase the cost to Lender for extending or
maintaining the credit facilities to which this Agreement relates, (B) reduce
the amounts payable to Lender under this Agreement or the Related Documents, or
IC) reduce the rate of return on Lender's capital as a consequence of Lender's
obligations with respect to the credit facilities to which this Agreement
relates, then Borrower agrees to pay Lender such additional amounts as will
compensate Lender therefor, within five (5) days after ▇▇▇▇▇▇'s written demand
for such payment, which demand shall be accompanied by an explanation of such
imposition or charge and a calculation in reasonable detail of the additional
amounts payable by Borrower, which explanation and calculations shall be
conclusive in the absence of manifest error.
▇▇▇▇▇▇'S EXPENDITURES. If any action or proceeding is commenced that would
materially affect ▇▇▇▇▇▇'s interest in the Collateral or if Borrower fails to
comply with any provision of this Agreement or any Related Documents, including
but not limited to Borrower's failure to discharge or pay when due any amounts
Borrower is required to discharge or pay under this Agreement or any Related
Documents, Lender on Borrower's behalf may (but shall not be obligated to) take
any action that Lender deems appropriate, including but not limited to
discharging or paying all taxes, liens, security interests, encumbrances and
other claims, at any time levied or placed on any Collateral and paying all
costs for insuring, maintaining and preserving any Collateral. All such
expenditures incurred or paid by Lender for such purposes will then bear
interest at the rate charged under the Note from the date incurred or paid by
Lender to the date of repayment by ▇▇▇▇▇▇▇▇. Al) such expenses will become a
part of the Indebtedness and, at Lender's option, will (A) be payable on demand;
(B) be added to the balance of the Note and be apportioned among and be payable
with any installment payments to become due during either (1) the term of any
applicable insurance policy; or (2) the remaining term of the Note; or (C) be
treated as a balloon payment which will be due and payable at the Note's
maturity.
NEGATIVE COVENANTS. Borrower covenants and agrees with Lender that while this
Agreement is in effect, Borrower shall not, without the prior written consent of
Lender:
Indebtedness and Liens. (1) Except for trade debt incurred in the normal
course of business and indebtedness to Lender contemplated by this
Agreement, create, incur or assume indebtedness for borrowed money,
including capital leases, (2) sell, transfer, mortgage, assign, pledge,
lease, grant a security interest in, or encumber any of Borrower's assets
(except as allowed as Permitted Liens), or (3) sell with recourse any of
Borrower's accounts, except to ▇▇▇▇▇▇.
Continuity of Operations. (1) Engage in any business activities
substantially different than those in which Borrower is presently engaged,
12) cease operations, liquidate, merge, transfer, acquire or consolidate
with any other entity, change its name, dissolve or transfer or sell
Collateral out of the ordinary course of business, or (31 pay any dividends
on Borrower's stock (other than dividends payable in its stock), provided,
however that notwithstanding the foregoing, but only so long as no Event of
Default has occurred and is continuing or would result from the payment of
dividends, if Borrower is a " Subchapter S Corporation" (as defined in the
Internal Revenue Code of 1986, as amended), Borrower may pay cash dividends
on its stock to its shareholders from time to time in amounts necessary to
enable the shareholders to pay income taxes and make estimated income tax
payments to satisfy their liabilities under federal and state law which
arise solely from their status as Shareholders of a Subchapter S
Corporation because of their ownership of shares of Borrower's stock, or
purchase or retire any of Borrower's outstanding shares or alter or amend
Borrower's capital structure.
Loans, Acquisitions and Guaranties. (1) Loan, invest in or advance money or
assets, (2) purchase, create or acquire any interest in any other
enterprise or entity, or (31 incur any obligation as surety or guarantor
other than in the ordinary course of business.
CESSATION OF ADVANCES. If Lender has made any commitment to make any Loan to
Borrower, whether under this Agreement or under any other agreement, Lender
shall have no obligation to make Loan Advances or to disburse Loan proceeds if:
(A) Borrower or any Guarantor is in default under the terms of this Agreement or
any of the Related Documents or any other agreement that Borrower or any
Guarantor has with Lender; (B) Borrower or any Guarantor dies, becomes
incompetent or becomes insolvent, files a petition in bankruptcy or similar
proceedings, or is adjudged a bankrupt; (C) there occurs a material adverse
change in Borrower's financial condition, in the financial condition of any
Guarantor, or in the value of any Collateral securing any Loan; or ID) any
Guarantor seeks, claims or otherwise attempts to limit, modify or revoke such
Guarantor's guaranty of the Loan or any other loan with Lender; or (El Lender in
good ▇▇▇▇▇ ▇▇▇▇▇ itself insecure, even though no Event of Default shall have
occurred.
RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a
right of setoff in all Borrower's accounts with Lender (whether checking,
savings, or some other account). This includes all accounts Borrower holds
jointly with someone else and all accounts Borrower may open in the future.
However, this does not include any IRA or ▇▇▇▇▇ accounts, or any trust accounts
for which setoff would be prohibited by law. ▇▇▇▇▇▇▇▇ authorizes ▇▇▇▇▇▇, to the
extent permitted by applicable law, to charge or setoff all sums owing on the
Indebtedness against any and a)) such accounts.
DEFAULT. Each of the following shall constitute an Event of Default under this
Agreement:
Payment Default. ▇▇▇▇▇▇▇▇ fails to make any payment when due under the
Loan.
Other Defaults. Borrower fails to comply with or to perform any other term,
obligation, covenant or condition contained in this Agreement or in any of
the Related Documents or to comply with or to perform any term, obligation,
covenant or condition contained in any other agreement between Lender and
Borrower.
Environmental Default. Failure of any party to comply with or perform when
due any term, obligation, covenant or condition contained in any
environmental agreement executed in connection with any Loan.
False Statements. Any warranty, representation or statement made or
furnished to Lender by Borrower or on Borrower's behalf under this
Agreement or the Related Documents is false or misleading in any material
respect, either now or at the time made or furnished or becomes false or
misleading at any time thereafter.
Insolvency. The dissolution or termination of ▇▇▇▇▇▇▇▇'s existence as a
going business, the insolvency of ▇▇▇▇▇▇▇▇, the appointment of a receiver
for any part of ▇▇▇▇▇▇▇▇'s property, any assignment for the benefit of
creditors, any type of creditor workout, or the commencement of any
proceeding under any bankruptcy or insolvency laws by or against Borrower.
Defective Collateralization. This Agreement or any of the Related Documents
ceases to be in full force and effect (including failure of any collateral
document to create a valid and perfected security interest or lien) at any
time and for any reason.
Creditor or Forfeiture Proceedings. Commencement of foreclosure or
forfeiture proceedings, whether by judicial proceeding, self-help,
repossession or any other method, by any creditor of Borrower or by any
governmental agency against any collateral securing the Loan. This includes
a garnishment of any of ▇▇▇▇▇▇▇▇'s accounts, including deposit accounts,
with Lender. However, this Event of Default shall not apply if there is a
good faith dispute by ▇▇▇▇▇▇▇▇ as to the validity or reasonableness of the
claim which is the basis of the creditor or forfeiture proceeding and if
Borrower gives ▇▇▇▇▇▇ written notice of the creditor or forfeiture
proceeding and deposits with Lender monies or a surety bond for the
creditor or forfeiture proceeding, in an amount determined by Lender, in
its sole discretion, as being an adequate reserve or bond for the dispute.
Events Affecting Guarantor. Any of the preceding events occurs with respect
to any Guarantor of any of the Indebtedness or any Guarantor dies or
becomes incompetent, or revokes or disputes the validity of, or liability
under, any Guaranty of the Indebtedness. In the event of a death, Lender,
at its option, may, but shall not be required to, permit the Guarantor's
estate to assume unconditionally the obligations arising under the guaranty
in a manner satisfactory to Lender, and, in doing so, cure any Event of
Default.
Change in Ownership. Any change in ownership of twenty-five percent (25%)
or more of the common stock of Borrower.
Adverse Change. A material adverse change occurs in Borrower's financial
condition, or ▇▇▇▇▇▇ believes the prospect of payment or performance of the
Loan is impaired.
Insecurity. Lender in good faith believes itself insecure.
Right to Cure. If any default, other than a default on Indebtedness, is
curable and if Borrower or Grantor, as the case may be, has not been given
a notice of a similar default within the preceding twelve (12) months, it
may be cured (and no Event of Default will have occurred) if Borrower or
Grantor, as the case may be, after receiving written notice from Lender
demanding cure of such default: (1) cure the default within twenty (20)
days; or (2) if the cure requires more than twenty (20) days, immediately
initiate steps which Lender deems in ▇▇▇▇▇▇'s sole discretion to be
sufficient to cure the default and thereafter continue and complete all
reasonable and necessary steps sufficient to produce compliance as soon as
reasonably practical.
EFFECT OF AN EVENT OF DEFAULT. If any Event of Default shall occur, except where
otherwise provided in this Agreement or the Related Documents, all commitments
and obligations of Lender under this Agreement or the Related Documents or any
other agreement immediately will terminate (including any obligation to make
further Loan Advances or disbursements), and, at Lender's option, all
Indebtedness immediately will become due and payable, all without notice of any
kind to Borrower, except that in the case of an Event of Default of the type
described in the " Insolvency" subsection above, such acceleration shall be
automatic and not optional. In addition, Lender shall have a)) the rights and
remedies provided ln the Related Documents or available at law, in equity, or
otherwise. Except as may be prohibited by applicable law, all of Lender's rights
and remedies shall be cumulative and may be exercised singularly or
concurrently. Election by ▇▇▇▇▇▇ to pursue any remedy shall not exclude pursuit
of any other remedy, and an election to make expenditures or to take action to
perform an obligation of Borrower or of any Grantor shall not affect ▇▇▇▇▇▇'s
right to declare a default and to exercise its rights and remedies.
FINANCIAL RECORDS REQUIRED DURING TERM OF LOAN. ▇▇▇▇▇▇▇▇ agrees to furnish
Lender with, as soon as available, but in no event later than one hundred twenty
(120) days after the end of each fiscal year, the following: (1) annual compiled
financial statements for subject business(es), and any affiliate business(es) as
applicable, prepared by a CPA in accordance with Generally Accepted Accounting
Principles Time is of the Essence. Time is of the essence ln the performance of
this Agreement. (GAAP), (2) annual federal income tax return(s) or extension(s)
for business(es), and affiliate business(es) if applicable, and (3) annual
persona) financial statement(s) and federal income tax return(s) or extension(s)
on all individual Borrowers and full Guarantors.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Agreement:
Amendments. This Agreement, together with any Related Documents,
constitutes the entire understanding and agreement of the parties as to the
matters set forth in this Agreement. No alteration of or amendment to this
Agreement shall be effective unless given in writing and signed by the
party or parties sought to be charged or bound by the alteration or
amendment.
Attorneys' Fees; Expenses. ▇▇▇▇▇▇▇▇ agrees to pay upon demand all of
▇▇▇▇▇▇'s costs and expenses, including ▇▇▇▇▇▇'s attorneys' fees and
▇▇▇▇▇▇'s legal expenses, incurred in connection with the enforcement of
this Agreement. Lender may hire or pay someone else to help enforce this
Agreement, and Borrower shall pay the costs and expenses of such
enforcement. Costs and expenses include ▇▇▇▇▇▇'s attorneys' fees and legal
expenses whether or not there is a lawsuit, including attorneys' fees and
legal expenses for bankruptcy proceedings (including efforts to modify or
vacate any automatic stay or injunction), appeals, and any anticipated
post-judgment collection services. Borrower also shall pay all court costs
and such additional fees as may be directed by the court.
Caption Headings. Caption headings in this Agreement are for convenience
purposes only and are not to be used to interpret or define the provisions
of this Agreement.
Consent to Loan Participation. ▇▇▇▇▇▇▇▇ agrees and consents to ▇▇▇▇▇▇'s
sale or transfer, whether now or later, of one or more participation
interests in the Loan to one or more purchasers, whether related or
unrelated to Lender. Lender may provide, without any limitation whatsoever,
to any one or more purchasers, or potential purchasers, any information or
knowledge Lender may have about Borrower or about any other matter relating
to the Loan, and Borrower hereby waives any rights to privacy Borrower may
have with respect to such matters. Borrower additionally waives any and all
notices of sale of participation interests, as well as all notices of any
repurchase of such participation interests. ▇▇▇▇▇▇▇▇ also agrees that the
purchasers of any such participation interests will be considered as the
absolute owners of such interests in the Loan and will have all the rights
granted under the participation agreement or agreements governing the sale
of such participation interests. Borrower further waives all rights of
offset or counterclaim that it may have now or later against Lender or
against any purchaser of such a participation interest and unconditionally
agrees that either Lender or such purchaser may enforce ▇▇▇▇▇▇▇▇'s
obligation under the Loan irrespective of the failure or insolvency of any
holder of any interest in the Loan. ▇▇▇▇▇▇▇▇ further agrees that the
purchaser of any such participation interests may enforce its interests
irrespective of any persona) claims or defenses that Borrower may have
against ▇▇▇▇▇▇.
Governing Law. This Agreement will be governed by, construed and enforced
in accordance with federal law and the laws of the State of Colorado. This
Agreement has been accepted by ▇▇▇▇▇▇ in the State of Colorado.
Choice of Venue. If there is a lawsuit, ▇▇▇▇▇▇▇▇ agrees upon ▇▇▇▇▇▇'s
request to submit to the jurisdiction of the courts of Boulder County,
State of Colorado.
No Waiver by ▇▇▇▇▇▇. Lender shall not be deemed to have waived any rights
under this Agreement unless such waiver is given in writing and signed by
▇▇▇▇▇▇. No delay or omission on the part of Lender in exercising any right
shall operate as a waiver of such right or any other right. A waiver by
▇▇▇▇▇▇ of a provision of this Agreement shall not prejudice or constitute a
waiver of Lender's right otherwise to demand strict compliance with that
provision or any other provision of this Agreement. No prior waiver by
▇▇▇▇▇▇, nor any course of dealing between ▇▇▇▇▇▇ and Borrower, or between
Lender and any Grantor, shall constitute a waiver of any of Lender's rights
or of any of Borrower's or any Grantor's obligations as to any future
transactions. Whenever the consent of Lender is required under this
Agreement, the granting of such consent by Lender in any instance shall not
constitute continuing consent to subsequent instances where such consent is
required and in all cases such consent may be granted or withheld in the
sole discretion of Lender.
Notices. Any notice required to be given under this Agreement shall be
given in writing, and shall be effective when actually delivered, when
actually received by telefacsimile (unless otherwise required by law), when
deposited with a nationally recognized overnight courier, or, if mailed,
when deposited in the United States mail, as first class, certified or
registered mail postage prepaid, directed to the addresses shown near the
beginning of this Agreement. Any party may change its address for notices
under this Agreement by giving formal written notice to the other parties,
specifying that the purpose of the notice is to change the party's address.
For notice purposes, ▇▇▇▇▇▇▇▇ agrees to keep ▇▇▇▇▇▇ informed at all times
of ▇▇▇▇▇▇▇▇'s current address. Unless otherwise provided or required by
law, if there is more than one Borrower, any notice given by Lender to any
Borrower is deemed to be notice given to all Borrowers.
Severability. If a court of competent jurisdiction finds any provision of
this Agreement to be illegal, invalid, or unenforceable as to any
circumstance, that finding shall not make the offending provision illegal,
invalid, or unenforceable as to any other circumstance. If feasible, the
offending provision shall be considered modified so that it becomes legal,
valid and enforceable. If the offending provision cannot be so modified, it
shall be considered deleted from this Agreement. Unless otherwise required
by law, the illegality, invalidity, or unenforceability of any provision of
this Agreement shall not affect the legality, validity or enforceability of
any other provision of this Agreement.
Subsidiaries and Affiliates of Borrower. To the extent the context of any
provisions of this Agreement makes it appropriate, including without
limitation any representation, warranty or covenant, the word " Borrower"
as used in this Agreement shall include all of Borrower's subsidiaries and
affiliates. Notwithstanding the foregoing however, under no circumstances
shall this Agreement be construed to require Lender to make any Loan or
other financial accommodation to any of Borrower's subsidiaries or
affiliates.
Successors and Assigns. All covenants and agreements contained by or on
behalf of Borrower shall bind ▇▇▇▇▇▇▇▇'s successors and assigns and shall
inure to the benefit of Lender and its successors and assigns. Borrower
shall not, however, have the right to assign ▇▇▇▇▇▇▇▇'s rights under this
Agreement or any interest therein, without the prior written consent of
Lender.
Survival of Representations and Warranties. ▇▇▇▇▇▇▇▇ understands and agrees
that in making the Loan, ▇▇▇▇▇▇ is relying on all representations,
warranties, and covenants made by Borrower in this Agreement or in any
certificate or other instrument delivered by Borrower to Lender under this
Agreement or the Related Documents. ▇▇▇▇▇▇▇▇ further agrees that regardless
of any investigation made by ▇▇▇▇▇▇, all such representations, warranties
and covenants will survive the making of the Loan and delivery to Lender of
the Related Documents, shall be continuing in nature, and shall remain in
full force and effect until such time as ▇▇▇▇▇▇▇▇'s Indebtedness shall be
paid in full, or until this Agreement shall be terminated in the manner
provided above, whichever is the last to occur.
Time is of the Essence. Time is of the essence in the performance of this
Agreement.
DEFlNlTlONS The following capitalized words and terms shall have the following
meanings when used in this Agreement. Unless specifically stated to the
contrary, all references to dollar amounts shall mean amounts in (awful money of
the United States of America. Words and terms used in the singular shall include
the plural, and the plural shall include the singular, as the context may
require. Words and terms not otherwise defined in this Agreement shall have the
meanings attributed to such terms in the Uniform Commercial Code. Accounting
words and terms not otherwise defined in this Agreement shall have the meanings
assigned to them in accordance with generally accepted accounting principles as
in effect on the date of this Agreement:
Advance. The word "Advance" means a disbursement of Loan funds made, or to
be made, to Borrower or on Borrower's behalf on a line of credit or
multiple advance basis under the terms and conditions of this Agreement.
Agreement. The word "Agreement" means this Business Loan Agreement, as this
Business Loan Agreement may be amended or modified from time to time,
together with all exhibits and schedules attached to this Business Loan
Agreement from time to time.
Borrower. The word "Borrower" means Eldorado Artesian Springs, Inc., and
all other persons and entities signing the Note in whatever capacity.
Collateral. The word "Collateral" means all property and assets granted as
collateral security for a Loan, whether real or personal property, whether
granted directly or indirectly, whether granted now or in the future, and
whether granted in the form of a security interest, mortgage, collateral
mortgage, deed of trust, assignment, pledge, crop pledge, chattel mortgage,
collateral chattel mortgage, chattel trust, factor's lien, equipment trust,
conditional sale, trust receipt, lien, charge, lien or title retention
contract, lease or consignment intended as a security device, or any other
security or lien interest whatsoever, whether created by law, contract, or
otherwise.
Environmental Laws. The words " Environmental Laws" mean any and all state,
federal and local statutes, regulations and ordinances relating to the
protection of human health or the environment, including without limitation
the Comprehensive Environmental Response, Compensation, and Liability Act
of 1980, as amended, 42 U.S.C. Section 9601, et seq. ("CERCLA"), the
Superfund Amendments and Reauthorization Act of 1 986, Pub. L. No. 99-499
("▇▇▇▇"), the Hazardous Materials Transportation Act, 49 U.S.C. Section
1801, et seq., the Resource Conservation and Recovery Act, 42 U.S.C.
Section 6901, et seq., or other applicable state or federal laws, rules, or
regulations adopted pursuant thereto.
Event of Default. The words " Event of Default" mean any of the events of
default set forth in this Agreement in the default section of this
Agreement.
GAAP. The word "GAAP" means generally accepted accounting principles.
Grantor. The word "Grantor" means each and all of the persons or entities
granting a Security Interest in any Collateral for the Loan, including
without limitation all Borrowers granting such a Security Interest.
Guarantor. The word Guarantor" means any guarantor, surety, or
accommodation party of any or all of the Loan.
Guaranty. The word "Guaranty" means the guaranty from Guarantor to Lender,
including without limitation a guaranty of all or part of the Note.
Hazardous Substances. The words "Hazardous Substances" mean materials that,
because of their quantity, concentration or physical, chemical or
infectious characteristics, may cause or pose a present or potential hazard
to human health or the environment when improperly used, treated, stored,
disposed of, generated, manufactured, transported or otherwise handled. The
words " Hazardous Substances" are used in their very broadest sense and
include without limitation any and all hazardous or toxic substances,
materials or waste as defined by or listed under the Environmental Laws.
The term "Hazardous Substances" also includes, without limitation,
petroleum and petroleum by-products or any fraction thereof and asbestos.
Indebtedness. The word " Indebtedness" means the indebtedness evidenced by
the Note or Related Documents, including all principal and interest
together with all other indebtedness and costs and expenses for which
Borrower is responsible under this Agreement or under any of the Related
Documents.
Lender. The word "Lender" means Bank of the West, its successors and
assigns.
Loan. The word " Loan" means any and all loans and financial accommodations
from Lender to Borrower whether now or hereafter existing, and however
evidenced, including without limitation those loans and financial
accommodations described herein or described on any exhibit or schedule
attached to this Agreement from time to time.
Note. The word "Note" means the Note executed by ▇▇▇▇▇▇▇▇ in the principal
amount of $1,421,000.00 dated August 21, 2001, together with all renewals
of, extensions of, modifications of, refinancings of, consolidations of,
and substitutions for the note or credit agreement.
Permitted Liens. The words "Permitted Liens" mean (1) liens and security
interests securing Indebtedness owed by Borrower to Lender; (2) liens for
taxes, assessments, or similar charges either not yet due or being
contested in good faith; (3) liens of material men, mechanics,
warehousemen, or carriers, or other like liens arising in the ordinary
course of business and securing obligations which are not yet delinquent;
(4) purchase money liens or purchase money security interests upon or in
any property acquired or held by Borrower in the ordinary course of
business to secure indebtedness outstanding on the date of this Agreement
or permitted to be incurred under the paragraph of this Agreement titled
"Indebtedness and Liens"; (5) liens and security interests which, as of the
date of this Agreement, have been disclosed to and approved by the Lender
in writing; and (61 those liens and security interests which in the
aggregate constitute an immaterial and insignificant monetary amount with
respect to the net value of Borrower's assets.
Related Documents. The words " Related Documents" mean all promissory
notes, credit agreements, loan agreements, environmental agreements,
guaranties, security agreements, mortgages, deeds of trust, security deeds,
collateral mortgages, and all other instruments, agreements and documents,
whether now or hereafter existing, executed in connection with the Loan.
Security Agreement. The words " Security Agreement" mean and include
without limitation any agreements, promises, covenants, arrangements,
understandings or other agreements, whether created by law, contract, or
otherwise, evidencing, governing, representing, or creating a Security
Interest.
Security interest. The words " Security Interest" mean, without limitation,
any and all types of collateral security, present and future, whether in
the form of a lien, charge, encumbrance, mortgage, deed of trust, security
deed, assignment, pledge, crop pledge, chattel mortgage, collateral chattel
mortgage, chattel trust, factor's lien, equipment trust, conditional sale,
trust receipt, lien or title retention contract, lease or consignment
intended as a security device, or any other security or lien interest
whatsoever whether created by law, contract, or otherwise.
▇▇▇▇▇▇▇▇ ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN
AGREEMENT AND ▇▇▇▇▇▇▇▇ AGREES TO ITS TERMS. THIS BUSINESS LOAN AGREEMENT IS
DATED AUGUST 21, 2001.
BORROWER:
ELDORADO ARTESIAN SPRINGS, INC.
By:/s/▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, President of Eldorado Artesian Springs, Inc.
By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Secretary of Eldorado Artesian Springs, Inc.
By:/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇, Vice President of Eldorado Artesian Springs, Inc.
LENDER:
BANK OF THE WEST
By
Authorized Signer