UNITED BANK WEST VIRGINIA’S BANK
UNITED
BANK
WEST
VIRGINIA’S BANK
LOAN
NUMBER
▇▇▇▇▇▇▇-9002 LOAN
NAME
Champion
Industries, Inc. ACCT.
NUMBER
5112131
NOTE
DATE
12/29/06 INITIALS
LJP
NOTE
AMOUNT
$1,351,225.00 INDEX
(w/Margin)
Wall
Street Journal Prime RATE
8.250%
MATURITY
DATE 01/01/12 LOAN
PURPOSE
Commercial
Creditor
Use Only
(Commercial
- Single Advance - Variable Rate)
DATE
AND PARTIES.
The
date of this Promissory Note and Security Agreement {Loan Agreement) is October
26, 2004. The parties and their addresses are:
LENDER:
UNITED
BANK. INC.
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Telephone:
(▇▇▇) ▇▇▇-▇▇▇▇
BORROWER:
CHAMPION
INDUSTRIES, INC.
a
West
Virginia Corporation
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1.
DEFINITIONS.
As used
in this Loan Agreement, the terms have the following meanings:
A.
Pronouns.
The
pronouns "I," "me," and "my" refer to each Borrower signing this Loan Agreement,
individually and together with their heirs, successors and assigns, and each
other person or legal entity (including guarantors, endorsers, and sureties)
who
agrees to pay this Loan Agreement. "You" and "Your" refer to the Lender, with
its participants or syndicators, successors and assigns, or any person or
company that acquires an interest in the Loan Agreement.
B.
Loan Agreement.
Loan
Agreement refers to this combined Note and Security Agreement, and any
extensions, renewals,
modifications and substitutions of this Loan Agreement.
C.
Loan.
Loan
refers to this transaction generally, including obligations and duties arising
from the terms of all documents prepared or submitted for this transaction
such
as applications, security agreements, disclosures or notes, and this Loan
Agreement.
D.
Property.
Property is any property, real, person or intangible, that secures my
performance of the obligations of
this
Loan.
E.
Percent.
Rates
and rate change limitations are expressed as annualized
percentages.
2.
PROMISE TO PAY.
For
value received, l promise to pay you or your order, at your address, or at
such
other location as you may designate, the principal sum of $1,351,225.00
(Principal)
plus
interest from December 29, 2006 on the unpaid Principal balance until this
Loan
Agreement matures or this obligation is accelerated.
3.
INTEREST.
Interest
will accrue on the unpaid Principal balance of this Loan Agreement at the rate
of 8.250 percent
(Interest Rate)
until
December 30, 2006, after which time it may change as described in the Variable
Rate subsection.
A.
Post-Maturity Interest.
After
maturity or acceleration, interest will accrue on the unpaid Principal balance
of this Loan Agreement at the Interest Rate in effect from time to time until
paid in full.
B.
Maximum Interest Amount.
Any
amount assessed or collected as interest under the terms of this Loan Agreement
or obligation will be limited to the Maximum Lawful Amount of interest allowed
by state or federal law. Amounts collected in excess of the Maximum Lawful
Amount will be applied first to the unpaid Principal balance. Any remainder
will
be refunded to me.
C.
Statutory Authority.
The
amount assessed or collected on this Loan Agreement is authorized by the West
Virginia usury laws under W. Va. Code §§ 47A-1-1, 47-6-1 et. seq., 31A-4-27 to
31A-4-30a and 31C-7-2.
D.
Accrual.
During
the scheduled term of this Loan interest accrues using an Actual/360 days
counting method.
E.
Variable Rate.
The
Interest Rate may change during the term of this transaction.
(1)
Index.
Beginning with the first Change Date, the Interest Rate will be based on the
following index: the base rate on corporate loans posted by at least 75% of
the
nation’s 30 largest banks known as the Wall Street Journal Prime
Rate.
The
Current Index is the most recent index figure available on each Change Date.
You
do not guaranty by selecting this Index, or the margin, that the Interest Rate
on this Loan Agreement will be the same rate you charge on any other loans
or
class of loans you make to me or other borrowers. If this Index is no longer
available, you will substitute a similar index. You will give me notice of
your
choice.
(2)
Change
Date. Each date on which the Interest Rate may change is called a Change Date.
The Interest Rate may change December 30, 2006 and daily
thereafter.
(3)
Calculation Of Change. On each Change Date, you will calculate the Interest
Rate, which will be the Current Index.
The
result of this calculation will be rounded to the nearest .01 percent. Subject
to any limitations, this will be the Interest Rate until the next Change Date.
The new Interest Rate will become effective on each Change Date. The Interest
Rate and other charges on this Loan Agreement will never exceed the highest
rate
or charge allowed by law for this Loan Agreement.
(4)
Effect
Of Variable Rate. A change in the Interest Rate will have the following effect
on the payments: The amount of scheduled payments will change.
4.
ADDITIONAL CHARGES.
As
additional consideration, l agree to pay, or have paid, these additional fees
and charges.
A.
Nonrefundable Fees and Charges.
The
following fees are earned when collected and will not be refunded if I prepay
this Loan Agreement before the scheduled maturity date.
Loan.
A(n)
Loan fee of $500.00 payable from the loan proceeds.
5.
REMEDIAL CHARGES.
In
addition to interest or other finance charges, I agree that I will pay these
additional fees based on my method and pattern of payment. Additional remedial
charges may be described elsewhere in this Loan Agreement.
A.
Late Charge.
If a
payment is more than 10 days late, I will be charged 2.000
percent
of the Amount of Payment or $15.00,
whichever is greater. However, this charge will not be greater than $100.00.
I will
pay this late charge promptly but only once for each late payment.
6.
PURCHASE MONEY SECURITY INTEREST.
This
Loan creates a Purchase Money Security Interest to the extent you are making
advances or giving value to me to acquire rights in or the use of collateral
and
I in fact use the value given for that purpose. Purchase Money Loan means any
loan or advance used to acquire rights in or the use of any Property. The
portion of the Property purchased with loan proceeds will remain subject to
the
Purchase Money Security Interest until the Secured Debts are paid in full.
I
authorize you, at your option, to disburse the loan proceeds directly to the
seller of the Property. Payments on any non-Purchase Money Loan also secured
by
this Loan will not be applied to the Purchase Money Loan. Payments on the
Purchase Money Loan will be applied first to the non-purchase money portion
of
the loan, if any, and then to the purchase money portion in the order in which
the purchase money Property was acquired. If the purchase money Property was
acquired at the same time, then payments will be applied in the order you
select. No security interest will be terminated by application of this formula.
You may include the name of the seller on the check or draft for this Loan
Agreement.
7.
PAYMENT.
I agree
to pay this Loan Agreement in 48 payments. A payment of $27,652.88
will be
due February 1, 2007, and on the 1st day of each month thereafter. This
scheduled payment amount may change to reflect changes in the Interest Rate
as
described in the Variable Rate subsection of this Loan Agreement. A final
payment of the entire unpaid balance of Principal and interest will be due
January 1, 2012.
Payments
will be rounded to the nearest $.01. With the final payment I also agree to
pay
any additional fees or charges owing and the amount of any advances you have
made to others on my behalf. Payments scheduled to be paid on the 29th, 30th
or
31st day of a month that contains no such day will, instead, be made on the
last
day of such month.
If
the
amount of a scheduled payment does not equal or exceed interest accrued during
the payment period the unpaid portion will be added to, and will be payable
with, the next scheduled payment.
Each
payment I make on this Loan Agreement will be applied first to interest that
is
due then to principal that is due, and finally to any charges that I owe other
than principal and interest. If you and I agree to a different application
of
payments, we will describe our agreement on this Loan Agreement. The actual
amount of my final payment will depend on my payment record.
8.
PREPAYMENT. I
may
prepay this Loan in full or in part at any time. Any partial prepayment will
not
excuse any later scheduled payments until I pay in full.
9.
LOAN PURPOSE.
The
purpose of this Loan is to purchase Syscan Corporation.
10.
SECURITY.
This
Loan is secured by Property described in the SECURITY AGREEMENT section of
this
Loan Agreement and by the following, previously executed, security instruments
or agreements: WV UCC filing 0544326 recorded 7-28-00 and UCC filing
200200137297 recorded 7-30-02; WV UCC filing 200400584284 recorded 10-27-04.
11.
SECURITY AGREEMENT.
A.
Secured Debts.
This
Security Agreement will secure the following debts (Secured Debts), together
with all extensions, renewals, refinancings, modifications and replacements
of
these debts:
(1)
Sums
Advanced under the terms of this Loan Agreement. All sums advanced and expenses
incurred by you under the terms of this Loan Agreement
(2)
All
Debts. All present and future debts of all Borrowers owing to you, even if
this
Security Agreement is not specifically referenced, the future debts are also
secured by other collateral, or if the future debt is unrelated to or of a
different type than this debt. If more than one person signs this Security
Agreement, each agrees that it will secure debts incurred either individually
or
with others who may not sign this Security Agreement. Nothing in this Security
Agreement constitutes a commitment to make additional or future loans or
advances. Any such commitment must be in writing.
This
Security Agreement will not secure any debt for which you fail to give any
required notice of the right of rescission. This Security Agreement will not
secure any debt for which a non-possessory, non-purchase money security interest
is created in "household goods" in connection with a "consumer loan," as those
terms are defined by federal law governing unfair and deceptive credit
practices.
B.
Security Interest.
To
secure the payment and performance of the Secured Debts, I give you a security
interest in all of the Property described in this Security Agreement that I
own
or have sufficient rights in which to transfer an interest, now or in the
future, wherever the Property is or will be located, and all proceeds and
products from the Property (including, but not limited to, all parts,
accessories, repairs, replacements, improvements, and accessions to the
Property). Property is all the collateral given as security for the Secured
Debts and described in this Security Agreement, and includes all obligations
that support the payment or performance of the Property. "Proceeds" includes
anything acquired upon the sale, lease, license, exchange, or other disposition
of the Property; any rights and claims arising from the Property; and any
collections and distributions on account of the Property.
This
Security Agreement remains in effect until terminated in writing, even if the
Secured Debts are paid and you are no longer obligated to advance funds to
me
under any loan or credit agreement.
C.
Property Description.
The
Property subject to this Security Agreement is described as
follows:
(1)
Inventory. All inventory which I hold for ultimate sale or lease, or which
has
been or will be supplied under contracts of service, or which are raw materials,
work in process, or materials used or consumed in my business.
(2)
Accounts
and Other Rights to Payment. All rights I have now or in the future to payments
including, but not limited to, payment for property or services sold, leased,
rented, licensed, or assigned, whether or not I have earned such payment by
performance. This includes any rights and interests (including all liens and
security interests) which I may have by law or agreement against any Account
Debtor or obligor of mine.
(3)
General
Intangibles. All general intangibles including, but not limited to, tax refunds,
applications for
patents,
copyrights, trademarks, trade secrets, good will, trade names, customer lists,
permits and franchises, payment intangibles, computer programs and all
supporting information provided in connection with a transaction relating to
computer programs, and the right to use my name.
(4)
Equipment. All equipment including, but not limited to, all machinery, vehicles,
furniture, fixtures, manufacturing equipment, farm machinery and equipment,
shop
equipment, office and recordkeeping equipment, and parts and tools. All
equipment described in a list or schedule which I give will also be included
in
the Property, but such a list is not necessary for a valid security interest
in
my equipment.
(5)
Specific
Property. The above described collateral is limited to that of the borrower's
Charleston WV division and/or all business assets acquired by the purchase
of
the Syscan Corporation Charleston WV division.
D.
Duties Toward Property.
(1)
Protection of Secured Party's Interest. I will defend the Property against
any
other claim. I agree to do whatever you require to protect your security
interest and to keep your claim in the Property ahead of the claims of other
creditors. I will not do anything to harm your position. I
will
keep books, records and accounts about the Property and my business in general.
I will let you examine these and make copies at any reasonable time. I will
prepare any report or accounting you request which deals with the
Property.
(2)
Use,
Location, and Protection of the Property. I will keep the Property in my
possession and in good repair. I will use it only for commercial purposes.
I
will not change this specified use without your prior written consent. You
have
the right of reasonable access to inspect the Property and I will immediately
inform you of any loss or damage to the Property. I will not cause or permit
waste to the Property.
I
will
keep the Property at my address listed in the DATE AND PARTIES section unless
we
agree I may keep it at another location. If the Property is to be used in other
states, I will give you a list of those states. The location of the Property
is
given to aid in the identification of the Property. It does not in any way
limit
the scope of the security interest granted to you. I will notify you in writing
and obtain your prior written consent to any change in location of any of the
Property. I will not use the Property in violation of any law. I will notify
you
in writing prior to any change in my address, name or, if an organization,
any
change in my identity or structure.
Until
the
Secured Debts are fully paid and this Security Agreement is terminated, I will
not grant a security interest in any of the Property without your prior written
consent. I will pay all taxes and assessments levied or assessed against me
or
the Property and provide timely proof of payment of these taxes and assessments
upon request.
(3)
Selling,
Leasing or Encumbering the Property. I will not sell, offer to sell, lease,
or
otherwise transfer or encumber the Property without your prior written
permission, except for Inventory sold in the ordinary course of business at
fair
market value, or at a minimum price established between you and me. If I am
in
default under this Security Agreement, I may not sell the Inventory portion
of
the Property even in the ordinary course of business. Any disposition of the
Property contrary to this Security Agreement will violate your rights. Your
permission to sell the Property may be reasonably withheld without regard to
the
creditworthiness of any buyer or transferee. I will not permit the Property
to
be the subject of any court order affecting my rights to the Property in any
action by anyone other than you. If the Property includes chattel paper or
instruments, either as original collateral or as proceeds of the Property,
I
will note your security interest on the face of the chattel paper or
instruments.
(4)
Additional Duties Specific to Accounts. I will not settle any Account for less
than its full value without your written permission. Until you tell me
otherwise, I will collect all Accounts in the ordinary course of business.
I
will not dispose of the Accounts by assignment without your prior written
consent. I will keep the proceeds from all the Accounts and any goods which
are
returned to me or which I take back. I will not commingle them with any of
my
other property. I will deliver the Accounts to you at your request. If you
ask
me to pay you the full price on any returned items or items retaken by me,
I
will do so. I will make no material change in the terms of any Account, and
I
will give you any statements, reports, certificates, lists of Account Debtors
(showing names, addresses and amounts owing), invoices applicable to each
Account, and other data in any way pertaining to the Accounts as you may
request.
E.
Collection Rights Of The Secured Party.
Account
Debtor means the person who is obligated on an account, chattel paper, or
general intangible. I authorize you to notify my Account Debtors of your
security interest and to deal with the Account Debtors' obligations at your
discretion. You may enforce the obligations of an Account Debtor, exercising
any
of my rights with respect to the Account Debtors obligations to make payment
or
otherwise render performance to me, including the enforcement of any security
interest that secures such obligations. You may apply proceeds received from
the
Account Debtors to the Secured Debts or you may release such proceeds to me.
I
specifically and irrevocably authorize you to exercise any of the following
powers at my expense, without limitation, until the Secured Debts are paid
in
full:
(1)
demand
payment and enforce collection from any Account Debtor or Obligor by suit or
otherwise.
(2)
enforce
any security interest, lien or encumbrance given to secure the payment or
performance of any Account Debtor or any obligation constituting
Property.
(3)
file
proofs of claim or similar documents in the event of bankruptcy, insolvency
or
death of any person obligated as an Account Debtor.
(4)
compromise, release, extend, or exchange any indebtedness of an Account
Debtor.
(5)
take
control of any proceeds of the Account Debtors' obligations and any returned
or
repossessed goods.
(6)
endorse
all payments by any Account Debtor which may come into your possession as
payable to me.
(7)
deal in
all respects as the holder and owner of the Account Debtors'
obligations.
F.
Authority To
Perform.
I
authorize you to do anything you deem reasonably necessary to protect the
Property, and perfect and continue your security interest in the Property.
If I
fail to perform any of my duties under this Loan Agreement or any other security
interest, you are authorized, without notice to me, to perform the duties or
cause them to be performed.
These
authorizations include, but are not limited to, permission to:
(1)
pay and
discharge taxes, liens, security interests or other encumbrances at any time
levied or placed on the Property.
(2)
pay any
rents or other charges under any lease affecting the Property.
(3)
order
and pay for the repair, maintenance and preservation of the
Property.
(4)
sign,
when permitted by law, and file any financing statements on my behalf and pay
for filing and recording fees pertaining to the Property.
(5)
place a
note on any chattel paper indicating your interest in the Property.
(6)
take any
action you feel necessary to realize on the Property, including performing
any
part of a contract or endorsing it in my name.
(7)
handle
any suits or other proceedings involving the Property in my name.
(8)
prepare,
file, and sign my name to any necessary reports or accountings.
(9)
make an
entry on my books and records showing the existence of this
Agreement.
(10)
notify
any Account Debtor of your interest in the Property and tell the Account Debtor
to make payments to you or someone else you name.
If
you
perform for me, you will use reasonable care. Reasonable care will not include:
any steps necessary to preserve rights against prior parties; the duty to send
notices, perform services or take any other action in connection with the
management of the Property; or the duty to protect, preserve or maintain any
security interest given to others by me or other parties. Your authorization
to
perform for me will not create an obligation to perform and your failure to
perform will not preclude you from exercising any other rights under the law
or
this Loan Agreement.
If
you
come into actual or constructive possession of the Property, you will preserve
and protect the Property. For purposes of this paragraph, you will be in actual
possession of the Property only when you have physical, immediate and
exclusive
control
over the Property and you have affirmatively accepted that control. You will
be
in constructive possession of the Property only when you have both the power
and
the intent to exercise control over the Property.
G.
Name and Location.
My name
indicated in the DATE AND PARTIES section is my exact legal name. I am an entity
organized and registered under the laws of West Virginia. I will provide
verification of registration and location upon your request. I will provide
you
with at least 30 days notice prior to any change in my name, address, or state
of organization or registration.
H.
Perfection of Security Interest.
I
authorize you to file a financing statement covering the Property. I will comply
with, facilitate, and otherwise assist you in connection with obtaining
perfection or control over the Property for purposes of perfecting your security
interest under the Uniform Commercial Code. I agree to pay all actual costs
of
terminating your security interest.
12.
DEFAULT.
I will
be in default if any of the following occur:
A.
Payments.
I fail
to make a payment in full when due.
B.
Insolvency or Bankruptcy.
The
death, dissolution or insolvency of, appointment of a receiver by or on behalf
of, application of any debtor relief law, the assignment for the benefit of
creditors by or on behalf of, the voluntary or involuntary termination of
existence by, or the commencement of any proceeding under any present or future
federal or state insolvency, bankruptcy, reorganization, composition or debtor
relief law by or against me or any co-signer, endorser, surety or guarantor
of
this Loan Agreement or any other obligations I have with you.
C.
Business Termination.
I merge,
dissolve, reorganize, end my business or existence, or a partner or majority
owner dies or is declared legally incompetent.
D.
Failure to Perform.
I fail
to perform any condition or to keep any promise or covenant of this Loan
Agreement.
E.
Other Documents.
A
default occurs under the terms of any other transaction document.
F.
Other Agreements.
I am in
default on any other debt or agreement I have with you.
G.
Misrepresentation.
I make
any verbal or written statement or provide any financial information that is
untrue, inaccurate, or conceals a material fact at the time it is made or
provided.
H.
Judgment.
I fail
to satisfy or appeal any judgment against me.
I.
Forfeiture.
The
Property is used in a manner or for a purpose that threatens confiscation by
a
legal authority.
J.
Name Change.
I change
my name or assume an additional name without notifying you before making such
a
change.
K.
Property Transfer.
I
transfer all or a substantial part of my money or property.
L.
Property Value. The
value
of the Property declines or is impaired.
M.
Material Change. Without
first notifying you, there is a material change in my business, including
ownership, management, and financial conditions.
N.
Insecurity.
You
reasonably believe that you are insecure.
13.
ASSUMPTIONS.
Someone
buying the Property cannot assume the obligation. You may declare the entire
balance of the Loan Agreement to be immediately due and payable upon the
creation of, or contract for the creation of, any lien, encumbrance, or transfer
of the Property. However, I may sell or similarly dispose of any Property that
is inventory.
14.
WAIVERS AND CONSENT.
To the
extent not prohibited by law, I waive protest, presentment for payment, demand,
notice of acceleration, notice of intent to accelerate and notice of dishonor.
A.
Additional Waivers By Borrower. In addition, I, and any party to this Loan
Agreement, to the extent permitted by law, consent to certain actions you may
take, and generally wave defenses that may be available based on these actions
or based on the status of a party to this Loan Agreement.
(1)
You may
renew or extend payments on this Loan Agreement, regardless of the number of
such renewals or extensions.
(2)
You may
release any Borrower, endorser, guarantor, surety, accommodation maker or any
other co-signer.
(3)
You may
release, substitute or impair any Property securing this Loan Agreement.
(4)
You, or
any institution participating in this Loan Agreement, may invoke your right
of
set-off.
(5)
You may
enter into any sales, repurchases or participations of this Loan Agreement
to
any person in any amounts and I waive notice of such sales, repurchases or
participations.
(6)
I agree
that any of us signing this Loan Agreement as a Borrower is authorized to modify
the terms of this Loan Agreement or any instrument securing, guarantying or
relating to this Loan Agreement.
B.
No Waiver By Lender.
Your
course of dealing, or your forbearance from, or delay in, the exercise of any
of
your rights, remedies, privileges or right to insist upon my strict performance
of any provisions contained in this Loan Agreement, shall not be construed
as a
waiver by you, unless any such waiver is in writing and is signed by you.
C.
Waiver of Claims.
I waive
all claims for loss or damage caused by your acts or omissions where you acted
reasonably and in good faith.
15.
REMEDIES.
After I
default, and after you give any legally required notice and opportunity to
cure
the default, you may at your option do any one or more of the following.
A.
Acceleration.
You may
make all or any part of the amount owing by the terms of this Loan Agreement
immediately due.
B.
Sources.
You may
use any and all remedies you have under state or federal law or in any
instrument securing this Loan Agreement.
C.
Insurance Benefits.
You may
make a claim for any and all insurance benefits or refunds that may be available
on my default.
D.
Payments Made On My Behalf.
Amounts
advanced on my behalf will be immediately due and may be added to the balance
owing under the terms of this Loan Agreement, and accrue interest at the highest
post-maturity interest rate.
E.
Set-Off.
You may
use the right of set-off. This means you may set-off any amount due and payable
under the terms of this Loan Agreement against any right I have to receive
money
from you.
My
right
to receive money from you includes any deposit or share account balance I have
with you; any money owed to me on an item presented to you or in your possession
for collection or exchange; and any repurchase agreement or other nondeposit
obligation. "Any amount due and payable under the terms of this Loan Agreement"
means the total amount to which you are entitled to demand payment under the
terms of this Loan Agreement at the time you set-off. Subject to any other
written contract, if my right to receive money from you is also owned by someone
who has not agreed to pay this Loan Agreement, your right of set-off will apply
to my interest in the obligation and to any other amounts I could withdraw
on my
sole request or endorsement. Your right of set-off does not apply to an account
or other obligation where my rights arise only in a representative capacity.
It
also does not apply to any Individual Retirement Account or other tax-deferred
retirement account. You will not be liable for the dishonor of any check when
the dishonor occurs because you set-off against any of my accounts. I agree
to
hold you harmless from any such claims arising as a result of your exercise
of
your right of set-off.
F.
Assembly of Property.
You may
require me to gather the Property and make it available to you in a reasonable
fashion.
G.
Repossession.
You may
repossess the Property so long as the repossession does not involve a breach
of
the peace. You may sell the Property as provided by law. You may apply what
you
receive from the sale of the Property to your expenses, your attorneys' fees
and
legal expenses (where not prohibited by law), and any debt I owe you. If what
you receive from the sale of the Property does not satisfy the debt, I will
be
liable for the deficiency {where permitted by law). In some cases, you may
keep
the Property to satisfy the debt. Where a notice is required, I agree that
ten
days prior written notice sent by first class mail to my address listed in
this
Loan Agreement will be reasonable notice to me under the West Virginia Uniform
Commercial Code. If the Property is perishable or threatens to decline speedily
in value, you may, without notice to me, dispose of any or all of the Property
in a commercially reasonable manner at my expense following any commercially
reasonable preparation or processing. If any items not otherwise subject to
this
Loan Agreement are contained in the Property when you take possession, you
may
hold these items for me at my risk and you will not be liable for taking
possession of them.
H.
Use and Operation.
You may
enter upon my premises and take possession of all or any part of my property
for
the purpose of preserving the Property or its value, so long as you do not
breach the peace. You may use and operate my property for the length of time
you
feel is necessary to protect your interest, all without payment or compensation
to me.
I.
Waiver.
Except
as otherwise required by law, by choosing any one or more of these remedies
you
do not give up your right to use any other remedy. You do not waive a default
if
you choose not to use a remedy. By electing not to use any remedy, you do not
waive your right to later consider the event a default and to use any remedies
if the default continues or occurs again.
16.
COLLECTION EXPENSES AND ATTORNEYS' FEES.
On or
after Default, to the extent permitted by law, I agree to pay all expenses
of
collection, enforcement or protection of your rights and remedies under this
Loan Agreement. Expenses include, but are not limited to, attorneys' fees,
court
costs and other legal expenses. These expenses are due and payable immediately.
If not paid immediately, these expenses will bear interest from the date of
payment until paid in full at the highest interest rate in effect as provided
for in the terms of this Loan Agreement. All fees and expenses will be secured
by the Property I have granted to you, if any. To the extent permitted by the
United States Bankruptcy Code, I agree to pay the reasonable attorneys' fees
you
incur to collect this Debt as awarded by any court exercising jurisdiction
under
the Bankruptcy Code.
17.
COMMISSIONS.
I
understand and agree that you (or your affiliate) will earn commissions or
fees
on any insurance products, and may earn such fees on other services that I
buy
through you or your affiliate.
18.
WARRANTIES AND REPRESENTATIONS.
I make
to you the following warranties and representations which will continue as
long
as this Loan Agreement is in effect:
A.
Power.
I am
duly organized, and validly existing and in good standing in all jurisdictions
in which I operate. I have the power and authority to enter into this
transaction and to carry on my business or activity as it is now being conducted
and, as applicable, am qualified to do so in each jurisdiction in which I
operate.
B.
Authority.
The
execution, delivery and performance of this Loan Agreement and the obligation
evidenced by this Loan Agreement are within my powers, have been duly
authorized, have received all necessary governmental approval, will not violate
any provision of law, or order of court or governmental agency, and will not
violate any agreement to which I am a party or to which I am or any of my
Property is subject.
C.
Business Name.
Other
than previously disclosed in writing to you I have not changed my name or
principal place of business within the last 10 years and have not used any
other
trade or fictitious name. Without your prior written consent, I do not and
will
not use any other name and will preserve my existing name, trade names, and
franchises.
D.
Ownership of Property.
To the
extent this is a Purchase Money Security Interest I will acquire ownership
of
the Property with the proceeds of the Purchase Money Loan. Your claim to the
Property is ahead of the claims of any other creditor, except as disclosed
in
writing to you prior to any advance on the Secured Debts. I represent that
I am
the original owner of the Property and, if I am not, that I have provided you
with a list of prior owners of the Property.
19.
INSURANCE.
I agree
to obtain the insurance described in this Loan Agreement.
A.
Property Insurance. I
agree
to keep the Property insured against the risks reasonably associated with the
Property. I will maintain this insurance in the amounts you require. This
insurance will last until the Property is released from this Loan Agreement.
I
may choose the insurance company, subject to your approval, which will not
be
unreasonably withheld. I will have the insurance company name you as loss payee
on any insurance policy. I will give you and the insurance company immediate
notice of any loss. You may apply the insurance proceeds toward what is owed
on
the Secured Debts. You may require added security as a condition of permitting
any insurance proceeds to be used to repair or replace the Property. If
you
acquire the Property in damaged condition, my right to any insurance policies
and proceeds will pass to you to the extent of the Secured Debts.
I
will
immediately notify you of cancellation or termination of insurance. If I fail
to
keep the Property insured, you may obtain insurance to protect your interest
in
the Property. This insurance may include coverages not originally required
of
me, may be written by a company other than one I would choose, and may be
written at a higher rate than I could obtain if I purchased the
insurance.
20.
APPLICABLE LAW.
This
Loan Agreement is governed by the laws of West Virginia, the United States
of
America and to the extent required, by the laws of the jurisdiction where the
Property is located. In the event of a dispute, the exclusive forum, venue
and
place of jurisdiction will be in West Virginia, unless otherwise required by
law.
21.
JOINT AND INDIVIDUAL LIABILITY AND SUCCESSORS.
My
obligation to pay this Loan is independent of the obligation of any other person
who has also agreed to pay it. You may ▇▇▇ me alone, or anyone else who is
obligated on this Loan, or any number of us together, to collect this Loan.
Extending this Loan or new obligations under this Loan, will not affect my
duty
under this Loan and I will still be obligated to pay this Loan. The duties
and
benefits of this Loan will bind and benefit the successors and assigns of you
and me.
22.
AMENDMENT, INTEGRATION AND SEVERABILITY.
This
Loan Agreement may not be amended or modified by oral agreement. No amendment
or
modification of this Loan Agreement is effective unless made in writing and
executed by you and me. This Loan Agreement is the complete and final expression
of the agreement. If any provision of this Loan Agreement is unenforceable,
then
the unenforceable provision will be severed and the remaining provisions will
still be enforceable.
23.
INTERPRETATION.
Whenever
used, the singular includes the plural and the plural includes the singular.
The
section headings are for convenience only and are not to be used to interpret
or
define the terms of this Loan Agreement.
24.
NOTICE, FINANCIAL REPORTS AND ADDITIONAL DOCUMENTS.
Unless
otherwise required by law, any notice will be given by delivering it or mailing
it by first class mail to the appropriate party's address listed in the DATE
AND
PARTIES section, or to any other address designated in writing. Notice to one
party will be deemed to be notice to all parties. I will inform you in writing
of any change in my name, address or other application information. I will
provide you any financial statement or information you request. All financial
statements and information I give you will be correct and complete. I agree
to
sign, deliver, and tile any additional documents or certifications that you
may
consider necessary to perfect, continue, and preserve my obligations under
this
Loan and to confirm your lien status on any Property. Time is of the
essence.
25.
CREDIT INFORMATION.
I agree
to supply you with whatever information you reasonably request. You will make
requests for this information without undue frequency, and will give me
reasonable time in which to supply the information.
26.
ERRORS AND OMISSIONS.
I agree,
if requested by you, to fully cooperate in the correction, if necessary, in
the
reasonable discretion of you of any and all loan closing documents so that
all
documents accurately describe the loan between you and me. I agree to assume
all
costs including by way of illustration and not limitation, actual expenses,
legal fees and marketing losses for failing to reasonably comply with your
requests within thirty (30) days.
27.
SIGNATURES.
By
signing under seal, I agree to the terms contained in this Loan Agreement.
I
also acknowledge receipt of a copy of this Loan Agreement.
BORROWER:
Champion
Industries, Inc.
By____________________
(seal)
▇▇▇▇
▇.
▇▇▇, Chief Financial Officer
LENDER:
United
Bank, Inc.
By____________________
(seal)
▇▇▇▇▇
▇.
▇▇▇▇▇▇▇▇▇, Vice President