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Exhibit A to First Amendment to Letter Loan Agreement
NEW REVOLVING NOTE
$2,000,000 October 23,
1997
FOR VALUE RECEIVED, ▇▇▇▇ INCORPORATED (the"Borrower") hereby
promises to pay to the order of FIRST BANK NATIONAL
ASSOCIATION (the "Lender") the principal sum of TWO MILLION
AND NO/100 DOLLARS ($2,000,000) or, if less, the unpaid
principal of all amounts advanced hereunder, together with
interest (calculated on the basis of actual days elapsed and
a year of 360 days) on the unpaid principal balance hereof at
the rate or rates set forth below. Payments will be made to
the Lender at its office at Sr. ▇▇▇▇. Minnesota or at such
other place as the Lender may from time to time hereafter
designate to the Borrower in writing in immediately
available, lawful money of the United States of America.
INTEREST RATE
The unpaid principal balance hereof from time to time
outstanding shall bear interest at a floating rate per
annum equal to the "Reference Rate" of the Lender. In the
event of any changes in the Reference Rate, the rate
applicable hereto shall change effective as of such change
in the Reference Rate. The Reference Rate is the rate
publicly announced by the Lender from time to time as its
Reference Rate; the Lender may lend to its customers at
rates that are at, above or below the Reference Rate.
Upon the happening of any Event of Default the unpaid
balance of this Note shall, at the option of the Lender,
thereafter bear interest until paid in full at a rate per
annum equal to the rate of interest applicable immediately
prior to such Event of Default plus 2.0%.
PROCEDURE FOR ADVANCES
Until the final maturity of this Note, the Borrower may
from time to time request an advance (an "Advance")
hereunder (in minimum amounts of $10,000 or integral
multiples thereof) and repay and, upon repayment, reborrow,
provided that the aggregate unpaid principal amount of all
Advances hereunder shall never Exceed 2,000,000 at any
time. In order to request an Advance hereunder the Borrower
shall give the Lender written notice of the requested
Advance which must be received by the Lender not later than
10:00 a.m. local time on the date of the requested Advance.
In giving such notice the Borrower shall specify the amount
and the date for the request Advance. The Lender shall trot
be obligated to make any Advance hereunder at any time when
any Event of Default, or any event which with the passage
of time or the giving of notice, or both, would become an
Event of Default, exists. The making of any Advance shall
also be subject to the terms, conditions and limitations of
the Loan Agreement (defined below), and in the case of any
conflict between the terms of this Note and the Loan
Agreement with respect to the making of any Advance, the
terms of the Loan Agreement shall prevail.
REPAYMENT
The principal hereof is payable in full on October 1, 1998.
Interest shall be payable monthly in arrears on the first
day of each month commencing November 1, 1997, and at final
maturity.
This Note may be prepaid by the Borrower at any time in
whole or from time to time in part (in minimum partial
payments of at least $10,000) without premium or penalty.
Any prepayment shall be applied first against accrued and
unpaid interest and the balance shall be applied to
principal.
PAYMENT DATES
The Lender is authorized to charge any account the Borrower
maintains with the Lender for payment of any amount owing
on this Note when due. Whenever any payment to be made an
this Note shall be stated to be due on a Saturday, Sunday
or legal holiday, such payment shall be made on the next
succeeding business day and such extension of time, in the
case of a payment of principal, shall be included in the
computation of any interest on such principal payment.
OTHER AGREEMENTS
This Note is issued pursuant to a Letter Loan Agreement
dated as of February 25, 1997, as amended (as the same may
hereafter be amended, modified or supplemented, or any
agreement entered into in substitution or replacement
thereof, the "Loan Agreement") between the Borrower and the
Lender and is secured pursuant to a Security Agreement
dated as of February 25, 1997, as well as other security
agreements (as the same may hereafter be amended, modified
or supplemented, or any agreement entered into in
substitution replacement
therefor, the "Security Agreement") given by the Borrower
to the Lender. This Note is given in extension and renewal
or, but not in payment of, a Revolving Note dated as of
February 25, 1997 in the original principal amount of
2,000,000.
EVENTS OF DEFAULT; REMEDIES OF LENDER
The occurrence of any one or more of the following events
shall constitute an Event of Default, and upon the
occurrence of any Event of Default the Lender may declare
this Note to be, and the same shall forthwith become,
immediately due and payable and the tender may exercise all
rights and remedies under the Loan Agreement and the
Security Agreement and as may otherwise be allowed by law:
(a) The Borrower shall fail to make any payment of
principal or interest hereon when due.
(b) The Borrower shall fail to comply with any other
term of this Note.
(c) Any default shall occur under the terms of the
Loan Agreement or the Security Agreement and shall
continue for more than the period of grace, if any,
applicable thereto.
If any Event of Default occurs the Borrower agrees to
pay all costs of collection,
including attorneys' fees, and the Lender shall have
the right to set off any
indebtedness of the Lender to the borrower against the
indebtedness on this Note.
OTHER TERMS
This Note cannot be amended or modified, or any provisions
hereof waived, except pursuant to a writing signed by the
Lender. The Lender does not, by failing to exercise of
delaying in exercising any right against the Borrower give
up that right. The Lender has no obligation to renew or
extend this Note. If part of this Note is unenforceable,
the rest of it will still be enforceable. The Lender may
assign this Note or grant participation's herein at any
time without the Borrower's consent and share information
about the Borrower in connection therewith.
THE VALIDITY, CONSTRUCTION AND ENFORCEABILITY OF THIS NOTE
SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF
MINNESOTA, WITHOUT GIVING EFFECT TO CONFLICT OF LAWS
PRINCIPLES
THEREOF BUT GIVING EFFECT TO FEDERAL LAWS OF THE UNITED
STATES
APPLICABLE TO NATIONAL BANKS.
AT THE OPTION OF THE LENDER THIS NOTE MAY BE ENFORCED IN
ANY FEDERAL COURT OR MINNESOTA STATE COURT SITTING IN
HENNEPIN COUNTY, MINNESOTA; AND THE BORROWER CONSENTS TO
THE
JURISDICTION ANY VENUE OF ANY SUCH COURT ANY WAIVES ANY
ARGUMENT THAT THE VENUE IN SUCH FORUMS IS NOT CONVENIENT.
IF THE BORROWER COMMENCES ANY ACTION IN ANOTHER
JURISDICTION OR VENUE UNDER ANY TORT OR CONTRACT THEORY
ARISING DIRECTLY OR INDIRECTLY FROM THE RELATIONSHIP
CREATED BY THIS NOTE, THE LENDER AT ITS OPTION SHALL BE
ENTITLED TO HAVE THE CASE TRANSFERRED TO ONE OF THE
JURISDICTIONS AND VENUES ABOVE- DESCRIBED, OR IF SUCH
TRANSFER CANNOT BE ACCOMPLISHED UNDER APPLICABLE LAW, TO
HAVE SUCH CASE DISMISSED WITHOUT PREJUDICE.
EACH OF THE BORROWER AND THE LENDER BY ITS ACCEPTANCE OF
THIS NOTE, IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY
JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS NOTE OR THE TRANSACTIONS CONTEMPLATED HEREBY
The Borrower hereby waives presentment for payment, notice
of dishonor, protest and notice of protest
▇▇▇▇ INCORPORATED
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Treasure
FIRST AMENDMENT TO LETTER LOAN AGREEMENT
This FIRST AMENDMENT TO LETTER LOAN AGREEMENT (this
"Amendment"), made and entered into as of October 23 1997,
is by and between ▇▇▇▇ Incorporated, a corporation
organized under the laws of the State of Minnesota (the
"Borrower"), and First Bank National Association, a
national banking association (the "Lender").
RECITALS
1. The Lender and the Borrower entered into a Letter
Loan Agreement dated as of February 25, 1997 (the "Credit
Agreement"); and
2. The Borrower desires to amend certain provisions
of the Credit Agreement, and the Lender has agreed to make
such amendments, subject to the terms and conditions set
forth in this Amendment.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged
the Parties hereto hereby covenant and agree to be bound as
follows:
Section 1. Capitalized Terms. Capitalized terms used
herein and not otherwise defined herein shit have the
meanings assigned to them in the Credit Agreement, unless
the context shall otherwise require.
Section 2. Amendments, The Credit Agreement is
hereby amended as follows:
2.1 Introductory paragraph: The introductory
paragraph of the Credit Agreement is amended to read in its
entirety as follows:
First Bank National Association (the "Lender") agrees
to make (i) revolving advances ("Advances") to ▇▇▇▇
Incorporated (the "Borrower"), in an aggregate amount
outstanding from time to time of up to the lesser of
$2,000,000 or the Borrowing Base (defined below), from the
date of the First Amendment to this Agreement (the "First
Amendment") until October 1, 1998 under a promissory note
dated the date of the First Amendment (as the same may
hereafter be amended. restated, extended, renewed or
otherwise modified from time to time, the "Revolving
Note"), and (ii) one or more term loans of up to $300.000
in the aggregate (each a "Term Loan Each Term Loan shall be
evidenced by a term note dated the date of such Term Loan
(as the same may hereafter be amended. restated, or
otherwise modified
from time to time, each a "Term Note") (the Revolving Note,
each Term Note and all other notes from the borrower to the
Lender are collectively the "Notes "). Each Term Note will
be in the form then in current use by the Lender for such
fixed rate installment obligations. Advances and Term Loans
will be made upon the following terms and subject to the
following conditions:
2.2 Terms Loans and Advances. Paragraph 1.1 (a) of
the Credit Agreement is amended to read in its entirety as
follows:
(a) The Term Loans and Advances. The Lender does not have
to make any Advances or any Term Loans until the conditions
of paragraph 6 have been satisfied. The proceeds of the
Advances will be used by the Borrower for its general
business purposes. All amounts outstanding under the
Revolving Note will bear interest at the rate or rates
provided in the Revolving Note. In addition to the
requirements under paragraph 6, Term Loans are subject to
the submission by the Borrower of the information and
documents required under paragraph 7 below. Term Loans will
bear interest at a fixed rate determined on the date of the
Term Loan.
2.3 Revolving Due Date. Paragraph 4 of the Credit
Agreement is amended by deleting the date "October 1, 1997"
as it appears therein and inserting in lieu thereof the
date "October 1, 1998".
2.4 Conditions for Term Loans. Paragraph 7 of the
Credit Agreement is amended by deleting therefrom the last
two sentences thereof.
2.5 Borrowing Base Certificates. Paragraph 9. e),
subclause (i) is amended to read in its entirety as
follows:
(i) be dated as of the last day of each month during
which there are outstanding Advances and be delivered to
the Lender by the thirtieth day of the next month or if no
Advances are outstanding, be dated as of the last day of
the month preceding the date of the requested Advance and
be delivered to the Lender prior to an Advance, and
Section 3. Effectiveness of Amendments. The amendments
contained in this Amendment shall become effective upon
delivery by the Borrower of, and Compliance by the Borrower
with. the following:
3.1 This Amendment and the Revolving Note in the form
of Exhibit A hereto (the "New Revolving Note"), each duly
executed by the borrower.
3.2 A copy of the resolutions of the Board of
Directors of the Borrower authorizing the execution,
delivery and performance of this Amendment and the New
Revolving Note certified as true and accurate by its
Secretary or Assistant Secretary, along with a
certification by such Secretary or Assistant Secretary
(i) certifying that there has been no amendment to the
Articles of Incorporation or Bylaws of the Borrower
since true and accurate copies of the same were last
delivered to the Lender, and (ii) identifying each
officer of the Borrower authorized to execute this
Amendment, the New Revolving Note and any other
instrument or agreement executed by the Borrower in
connection with this Amendment (collectively, the
"Amendment Documents"), and certifying as to specimens
of such officer's signature and such officer's
incumbency in such offices as such officer holds.
3.3 Certified copies of all documents evidencing any
necessary corporate action, consent or governmental or
regulatory approval (if any) with respect to this Amendment
3.4 A good standing certificate for the Borrower from
the state of Minnesota issued not more than 30 days prior
to the date of this Amendment.
3.5 A UCC search for the Borrower from the State of
Minnesota issued not more than 15 days prior to the date of
this Amendment.
3.6 The Borrower shall have satisfied such other
conditions as specified by the Lender, including payment of
all unpaid legal fees and expenses incurred by the Lender
through the date of this Amendment in connection with the
Credit Agreement and the Amendment Documents.
Section 4. Representations Warranties Authority, No
Adverse Claims.
4.1 Reassertion of Representations and Warranties, No
Default.
The Borrower hereby represents that on and as of the date
hereof and after giving effect to this Amendment (a) all of
the representations and warranties contained in the Credit
Agreement are true, correct and complete in all respects as
of the date hereof as though made on and as of such date,
except for changes permitted by the terms of the Credit
Agreement, and (5) there will exist no Event of Default
under the Credit Agreement as amended by this Amendment on
such date which has not been waived by the Lender.
4.2 Authority, No Conflict, No Consent Required.
The Borrower represents and warrants that the Borrower has
the power and legal right and authority to enter into the
Amendment Documents and has duly authorized as appropriate
the execution and delivery of the Amendment Documents and
other
agreements and documents executed and delivered by the
Borrower in connection herewith or therewith by proper
corporate, and none of the Amendment Documents nor the
agreements contained herein or therein contravene or
constitute a default under any agreement, instrument or
indenture to which the Borrower is a party or a signatory
or a provision of the Borrower's Articles of incorporation,
Bylaws or any other agreement or requirement of law, or
result in
the imposition of any lien on my of its property under any
agreement binding on or applicable to the Borrower or any
of its property except, if any, in favor of the Lender. The
Borrower represents and warrants that no consent, approval
or authorization of or registration or declaration with any
person, including but not limited to any governmental
authority, is required in connection with the execution and
delivery by the Borrower of the Amendment Documents or
other agreements and documents executed and delivered by
the Borrower in connection therewith or the performance of
obligations of the Borrower therein described, except for
those which the Borrower has obtained or provided and as to
which the Borrower has delivered certified copies of
documents evidencing each such action to the Lender.
4.3 No Adverse Claim. The Borrower warrants,
acknowledges and agrees that no events have been taken
plate and no circumstances exist at the date hereof which
would give the Borrower a basis to assert a defense, offset
or counterclaim to any claim of the Lender with respect to
the Borrower's obligations under the Credit Agreement as
amended by this Amendment.
Section 5. Affirmation of Credit Agreement Further
References,
Affirmation of Security interest. The Lender and the
Borrower each acknowledge and affirm that the Credit
Agreement, as hereby amended, is hereby ratified and
confirmed in all respects and all terms, conditions and
provisions of the Credit Agreement, except as amended by
this Amendment. shall remain unmodified and in full force
and effect. All references in any document or instrument to
the Credit Agreement are hereby amended and shall refer to
the Credit Agreement as amended by this Amendment. The
Borrower confirms to the Lender that the Borrower's
obligations under the Credit Agreement, as amended by this
Amendment are and continue to be secured by the security
interest granted by the Borrower in favor of the Lender
under that certain security agreement dated as of February
25, 1997, and made by the Borrower in favor of the Lender,
and all of the terms, conditions, provisions. agreements.
requirements, promises, obligations, duties, covenants and
representations of the Borrower under such documents and
any and all other documents and agreements entered into
with respect to the obligations under the Credit Agreement
are incorporated herein by reference and are hereby
ratified and affirmed in all respects by the Borrower
Section 6. Merger and Integration, Superseding
Effect. This Amendment, from and after the date hereof,
embodies the entire agreement and understanding between the
parties hereto and supersedes and has merged into this
Amendment all prior oral and written agreements on the same
subjects by and between the parties hereto with the effect
that this Amendment, shall control with respect to the
specific subjects hereof and thereof.
Section 7. Severability. Whenever possible, each
provision of this Amendment and the other Amendment
Documents and any other statement instrument or transaction
contemplated hereby or thereby or relating hereto or
thereto shall be interpreted in such manner as to be
effective, valid and enforceable under the applicable law
of any jurisdiction, but, if any provision of this
Amendment, the other Amendment Documents or any other
statement, instrument or transaction contemplated hereby or
thereby or relating hereto or thereto shall be held to be
prohibited, invalid or unenforceable under the applicable
law, such provision shall be ineffective in such
jurisdiction only to the extent of such prohibition.
Invalidity or unenforceability, without invalidating or
rendering unenforceable the remainder of such provision or
the remaining provisions of this Amendment, the other
Amendment Documents or any other statement, instrument or
transaction contemplated hereby or thereby or relating
hereto or thereto in such jurisdiction, or affecting the
effectiveness, validity or enforceability
of such provision in any other jurisdiction.
Section 8. Successors. The Amendment Documents
shall be binding on the borrower and the Lender and their
respective successors and assigns and shall inure to the
benefit of the Borrower and the Lender and the successors
and
assigns of the Lender.
Section 9. Legal Expenses. The borrower agrees to
reimburse the Lender, upon execution of this Amendment, for
an reasonable out-of-pocket expenses (including attorneys'
fees and legal expenses of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel
for the Lender) incurred in connection with the Credit
Agreement, including in connection with the negotiation,
preparation and execution of the Amendment Documents and
all other documents negotiated. prepared and executed in
connection with the Amendment Documents, and in enforcing
the
obligations of the Borrower under the Amendment Documents,
and to pay and save the Lender harmless from 811 liability
for, any stamp or other taxes which may be payable with
respect to the execution or delivery of the Amendment
Documents, which obligations of the borrower shall survive
any termination of the Credit Agreement.
Section 10. Headings. The headings of various
sections of this Amendment have been inserted for reference
only and shall not be deemed to be a part of this
Amendment.
Section 11. Counterparts. The Amendment Documents
may be executed in several counterparts as deemed necessary
or convenient, each of which,
when so executed, shall 6e deemed an original, provided
that all such counterparts shall be regarded as one and the
same document, and either party to the Amendment Documents
may execute any such agreement by executing a counterpart
of such agreement
Section 12. Governing Law. THE AMENDMENT DOCUMENTS
SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF
MINNESOTA. WITHOUT GIVING EFFECT TO CONFLICT OF LAW
PRINCIPLES THEREOF, BUT GIVING EFFECT TO FEDERAL LAWS
APPLICABLE TO NATIONAL BANKS, THEIR HOLDING COMPANIES AND
THEIR AFFILIATES.
IN WITNESS WHEREOF, the parties hereto have caused
this Amendment to be executed as of the date and year first
above written.
BORROWER: ▇▇▇▇ INCORPORATED
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Treasure
LENDER: FIRST BANK NATIONAL ASSOCIATION
By: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇▇▇
Title: Vice President