LINE OF CREDIT
West Pulteney Street
New York 14830
OF CREDIT LIMIT
LOAN PURPOSE: WORKING
Natural Gas Corporation
William Street, P. O. Box 58
LINE OF CREDIT AGREEMENT AND
NOTE. This Commercial Line of Credit Agreement and Note will be referred
to in this document as the “Agreement”.
LENDER. “Lender” means
Community Bank N.A. whose address is 331 West Pulteney Street, Corning, New York
14830 , its successors and assigns.
BORROWER. “Borrower” means
each person or legal entity who signs this Agreement.
PROMISE TO PAY. For value
received, receipt of which is hereby acknowledged, the Borrower promises to pay,
on demand by Lender, the principal amount of Eight Million and 00/100 Dollars
($8,000,000.00) or such lesser amount as shall have been advanced by Lender,
from time to time, to or on behalf of Borrower under this Agreement, and all
interest and any other charges, including service charges, to the order of
Lender at its office at the address noted above or at such other place as Lender
may designate in writing. The Borrower will make all payments in lawful money of
the United States of America.
PAYMENT SCHEDULE. This
Agreement will be paid according to the following required payment schedule:
Beginning on July 1, 2009, monthly payments of accrued and unpaid interest. All
payments received by the Lender from the Borrower for application to the Line of
Credit may be applied to the Borrower's obligations under the Line of Credit in
such order as determined by the Lender.
INTEREST RATE AND SCHEDULED PAYMENT
CHANGES. The initial variable interest rate on this Agreement will be
4.000% per annum. This interest rate may change on July 1, 2009, and on the same
day of each month thereafter. Each date on which the interest rate may change is
called the "Change Date." Beginning with the first Change Date, Lender will
calculate the new interest rate based on One Month Libor Rate in effect on the
Change Date (the "Index") plus 2.250 percentage points (the "Margin"). If the
Index is not available at that time, Lender will choose a new Index which is
based on comparable information. The Index is used solely to establish a base
from which the actual rate of interest payable under this Agreement will be
calculated, and is not a reference to any actual rate of interest charged by any
lender to any particular borrower. The interest rate will never be less than
contained herein shall be construed as to require the Borrower to pay interest
at a greater rate than the maximum allowed by law. If, however, from any
circumstances, Borrower pays interest at a greater rate than the maximum allowed
by law, the obligation to be fulfilled will be reduced to an amount computed at
the highest rate of interest permissible under applicable law and if, for any
reason whatsoever, Lender ever receives interest in an amount which would be
deemed unlawful under applicable law, such interest shall be automatically
applied to amounts owed, in Lender's sole discretion, or as otherwise allowed by
applicable law. An increase in the interest rates will result in a higher
payment amount. Interest on this Agreement is calculated on a 365/360 day basis.
The unpaid balance of this loan shall, after an Event of Default exists under
this Agreement or any other agreement related to the loan, be subject to a
Default Rate of interest equal to 2.000 percentage points over the applicable
variable interest rate in effect from time to time, calculated as described
above in the section "Interest Rate."
LATE PAYMENT CHARGE. If any
required payment is more than 10 days late, then at Lender's option, Lender will
assess a late payment charge of $25.00 or 5% of the amount past due, whichever
LINE OF CREDIT TERMS. This
Agreement is discretionary. The Borrower acknowledges and agrees that although
the Borrower may from time to time request an advance under this Agreement up to
a maximum amount equal to the Line of Credit Limit, the Lender in no way is
obligated to make such advance and all advances will be made by Lender in its
sole and absolute discretion and subject to the terms and conditions of this
under this Agreement may be requested orally or in writing by the Borrower or by
an authorized person.
total of all advances requested and unpaid principal cannot exceed Eight Million
and 00/100 Dollars ($8,000,000.00).
advances made will be charged to a loan account in Borrower's name on Lender's
books, and the Lender shall debit such account the amount of each advance made
to, and credit to such account the amount of each repayment made by Borrower.
Lender shall provide to Borrower periodic statements of Borrower's loan account,
which shall be deemed to be correct, accepted by, and binding upon Borrower
unless Lender receives a written statement of exception from Borrower within 10
days after such statement is furnished.
Suspension and Termination.
Advances under this Agreement will be available until the earlier to
occur of (a) demand by the Lender; (b) the Line of Credit is cancelled by
Borrower; or (c) the occurrence of an Event of Default.
Loan Type Conversion. Provided
no default or event of default shall have occurred, the Borrower may, at its
option, apply for conversion of this Agreement into a Term loan 30 days prior to
the Maturity Date. However, the Lender shall have no obligation to approve the
SECURITY TO NOTE. Security
(the "Collateral") for this Agreement is granted pursuant to the following
Agreement - all business assets dated August 4, 2005.
Agreement - assignment of trust fund dated November 28, 2005.
RIGHT OF SET-OFF. To the
extent permitted by law, Borrower agrees that Lender has the right to set-off
any amount due and payable under this Agreement, whether matured or unmatured,
against any amount owing by Lender to Borrower including any or all of
Borrower's accounts with Lender. This shall include all accounts Borrower holds
jointly with someone else and all accounts Borrower may open in the future. Such
right of set-off may be exercised by Lender against Borrower or against any
assignee for the benefit of creditors, receiver, or execution, judgment or
attachment creditor of Borrower, or against anyone else claiming through or
against Borrower of such assignee for the benefit of creditors, receiver, or
execution, judgment or attachment creditor, notwithstanding the fact that such
right of set-off has not been exercised by Lender prior to the making, filing or
issuance or service upon Lender of, or of notice of, assignment for the benefit
of creditors, appointment or application for the appointment of a receiver, or
issuance of execution, subpoena or order or warrant.
PAYABLE ON DEMAND. This is a
demand note. Payment is due upon Lender's demand.
DEFAULT. Upon the occurrence
of any one of the following events (each, an "Event of Default" or "default" or
"event of default"), Lender's obligations, if any, to make any advances will, at
Lender's option, immediately terminate and Lender, at its option, may declare
all indebtedness of Borrower to Lender under this Agreement to be immediately
due and payable without further notice of any kind notwithstanding anything to
the contrary in this Agreement or any other agreement: (a) Borrower's failure to
make any payment on time or in the amount due; (b) any default by Borrower under
the terms of this Agreement or any other agreement, security agreement executed
in connection with this Agreement (individually, a "Loan Document" and
collectively, the "Loan Documents"); (c) any default by Borrower under the terms
of any other loan agreement, security agreement, mortgage or other document in
favor of Lender; (d) the death, dissolution, or termination of existence of
Borrower or any guarantor; (e) Borrower is not paying Borrower's debts as such
debts become due; (f) the commencement of any proceeding under bankruptcy or
insolvency laws by or against Borrower or any guarantor or the appointment of a
receiver; (g) any default under the terms of any other indebtedness of Borrower
to any other creditor; (h) any writ of attachment, garnishment, execution, tax
lien or similar instrument is issued against any collateral securing the loan,
if any, or any of Borrower's property or any judgment is entered against
Borrower or any guarantor; (i) any part of Borrower's business is sold to or
merged with any other business, individual, or entity; (j) any representation or
warranty made by Borrower to Lender in any of the Loan Documents or any
financial statement delivered to Lender proves to have been false in any
material respect as of the time when made or given; (k) if any guarantor, or any
other party to any agreement or instrument with or in favor of Lender entered
into or delivered in connection with the Loan terminates, attempts to terminate
or defaults under any such agreement or instrument; (1) Lender has deemed itself
insecure or there has been a material adverse change of condition of the
financial prospects of Borrower or any collateral securing the obligations owing
to Lender by Borrower. Upon the occurrence of an event of default, Lender may
pursue any remedy available under any Related Document, at law or in
RELATED DOCUMENTS. If this
Agreement is secured by a security agreement, mortgage, deed of trust, trust
deed, security deed or loan agreement of even or previous date, it is subject to
all the terms thereof.
GENERAL WAIVERS. To the extent
permitted by law, the Borrower severally waives any required notice of
presentment, demand, acceleration, intent to accelerate, protest and any other
notice and defense due to extensions of time or other indulgence by Lender or to
any substitution or release of collateral. No failure or delay on the part of
Lender, and no course of dealing between Borrower and Lender, shall operate as a
waiver of such power or right, nor shall any single or partial exercise of any
power or right preclude other or further exercise thereof or the exercise of any
other power or right.
JOINT AND SEVERAL LIABILITY.
If permitted by law, each Borrower executing this Agreement is jointly and
SEVERABILITY. If a
court of competent jurisdiction determines any term or provision of this
Agreement is invalid or prohibited by applicable law, that term or provision
will be ineffective to the extent required. Any term or provision that has been
determined to be invalid or prohibited will be severed from the rest of this
Agreement without invalidating the remainder of either the affected provision or
rights and privileges of the Lender hereunder shall inure to the benefits of its
successors and assigns, and this Agreement shall be binding on all heirs,
executors, administrators, assigns and successors of Borrower.
may assign, pledge or otherwise transfer this Agreement or any of its rights and
powers under this Agreement without notice, with all or any of the obligations
owing to Lender by Borrower, and in such event the assignee shall have the same
rights as if originally named herein in place of Lender. Borrower may not assign
this Agreement or any benefit accruing to it hereunder without the express
written consent of the Lender.
ORAL AGREEMENTS DISCLAIMER.
This Agreement represents the final agreement between the parties and may not be
contradicted by evidence of prior, contemporaneous or subsequent oral agreements
of the parties. There are no unwritten oral agreements between the
GOVERNING LAW. This Agreement
is governed by the laws of the state of New York except to the extent that
federal law controls.
HEADING AND GENDER. The
headings preceding text in this Agreement are for general convenience in
identifying subject matter, but have no limiting impact on the text which
follows any particular heading. All words used in this Agreement shall be
construed to be of such gender or number as the circumstances
ATTORNEYS' FEES AND OTHER COSTS.
If legal proceedings are instituted to enforce the terms of this
Agreement, Borrower agrees to pay all costs of the Lender in connection
therewith, including reasonable attorneys' fees, to the extent permitted by
ADDITIONAL PROVISIONS. The
Commitment Letter from Lender to Borrower dated April 29, 2009, and its terms
and conditions, together with the Line of Credit Agreement dated June 5, 2009,
are incorporated by reference and made a part hereof with the same force and
effect as if it were set forth herein. In the event that any of the provisions
contained in the Commitment Letter or the Line of Credit Agreement conflict in
whole or in part with the provisions contained in this Commercial Line of Credit
Agreement and Note, the provisions contained in the Commitment Letter and Line
of Credit Agreement shall control.
OF JURY TRIAL. All parties to this Agreement hereby knowingly and voluntarily
waive, to the fullest extent permitted by law, any right to trial by jury of any
dispute, whether in contract, tort, or otherwise, arising out of, in connection
with, related to, or incidental to the relationship established between them in
this Agreement or any other instrument, document or agreement executed or
delivered in connection with this Agreement or the related
signing this Agreement, Borrower acknowledges reading, understanding, and
agreeing to all its provisions and receipt hereof.
Natural Gas Corporation