FRANCHISEE NOTE SUBFEATURE Clause Samples

FRANCHISEE NOTE SUBFEATURE. (i) As a subfeature under the Line of Credit, Bank agrees from time to time during the term thereof to make loans (each a "Franchisee Loan" and collectively, the "Franchisee Loans") to certain franchisees or area distributors (each a "Franchisee") of Borrower to finance the payment of leasehold improvements to Borrower. Such loans will be evidenced by promissory notes (each a "Franchisee Note" and collectively, "Franchisee Notes") in the form attached hereto as Exhibit "C"; provided however, that the aggregate amount of all outstanding Franchisee Notes shall not at any time exceed Four Million Dollars ($4,000,000.00). Each Franchisee Loan shall be in a minimum amount of Two Hundred Thousand Dollars ($200,000.00). The aggregate principal amount of all Franchisee Notes shall be reserved under the Line of Credit and shall not be available for borrowings thereunder. (ii) Each Franchisee Note shall be issued for a term of one hundred eighty (180) days, and may be renewed one (1) time for another one hundred eighty days upon payment of the fee required by Section 1.3(d) of this Agreement; provided however, that no Franchisee Note, or renewal thereof, shall have an expiration date subsequent to the maturity date of the Line of Credit. Each Franchisee Note shall be subject to the additional terms and conditions of this agreement or other document, if any, required by Borrower in connection with the issuance thereof (each a "Franchisee Note Agreement" and collectively, "Franchisee Note Agreements"). (iii) Borrower acknowledges and agrees that the agreements and other provisions of this Agreement and the guaranty of all Franchisee Loans by Borrower are material inducements to Bank's decision whether to make any Franchisee Loan. Borrower agrees to guarantee and does hereby unconditionally guarantee the payment of all Franchisee Loan amounts, including future Franchisee Loans, until all such indebtedness is fully and finally paid. Borrower agrees that all of the terms and provisions of the Guaranty of Franchise Note form (attached hereto as Exhibit "D" and incorporated herein for all purposes) shall be and are hereby incorporated by reference as the terms and provisions of this guarantee by Borrower of the Franchisee Loan amounts. (iv) Borrower represents and warrants that the persons whose names are signed as borrowers with respect to Franchisee Loans shall be franchisees or area distributors of Borrower, their signatures shall be genuine, and their authority and com...