EXHIBIT 10(j)
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REVOLVING CREDIT AGREEMENT
OnCourse Technologies, Inc.
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(Name of Customer)
The above named customer ("Customer", whether one or more) agrees with Lincoln
State Bank, 0000 Xxxxx 00xx Xxxxxx, Xxxxxxxxx, XX 00000, ("Lender") as follows:
1. REVOLVING LOANS. Customer requests that Lender lend to Customer from time
to time such amounts as Customer may request in accordance with this
Agreement (the "Loans"), and, subject to the terms of this Agreement,
Lender agrees to lend such amounts up to the aggregate principal amount of
$1,100,000.00 at any time outstanding (the "Credit Limit"). Within the
Credit Limit, Customer may borrow, repay and reborrow under this Agreement.
Lender is not obligated to but may make Loans in excess of the Credit Limit
and in any event Customer is liable for and agrees to pay all Loans.
2. BORROWING BASE. The aggregate amount of all Loans at any time outstanding
under this Agreement shall never exceed the lesser of the Credit Limit or
the Borrowing Base described on Exhibit A.
3. CONDITIONS FOR LOANS. Lender's obligation to make the initial Loan is
subject to satisfaction of the following conditions:
a. Lender shall have received the following security documents and the
additional security documents described on Exhibit B, if any (the
"Security Agreements"), duly executed.
b. Lender shall have received copies, certified by the Secretary of
Customer, of the articles of incorporation and bylaws of Customer and
each wholly owned subsidiary, and resolutions of the Board of
Directors of Customer authorizing the issuance, execution and delivery
of this Agreement and the Security Documents, if any, and a
certification of the names and addresses of the representatives of
Customer and each wholly owned subsidiary authorized to sign this
Agreement and the Security Documents, if any and request Loans under
this Agreement, together with true signatures of such representatives.
c. Lender shall have received from counsel for Customer a favorable
opinion satisfactory to Lender covering the matters described in
sections 5(c) and 5(d) as applicable, and 5(f) of this Agreement and
such other matters as Lender may reasonably request.
d. Lender shall have received a guaranty of payment of the Loans duly
executed by Micro Estimating Systems, Inc., TekSoft, Inc., Cimtronics,
Inc., and CAM Solutions, Inc. on WBA form 151.
e. All proceedings taken by Customer in connection with the Loans, the
Security Documents and other documents provided to Lender shall be
satisfactory to Lender and Lender shall have received copies of all
documents reasonably required by it.
4. LOAN PROCEDURES. Customer may obtain Loans under this Agreement as
provided below: Customer shall give Lender at lease one business day's
prior notice of any Loan requested under this Agreement, specifying the
date and amount of the Loan. Lender will make the Loan available to
Customer by crediting the amount of the Loan to Customer's account (acct.
no. 20-01 200 1) with Lender. Each Loan, which is less than the full
amount available to Customer under this Agreement shall be in an amount no
less than $1,000.00. Lender's obligation to make each Loan (including the
initial Loan) is subject to the further condition that Lender shall have
received a certificate signed by Customer, dated the date of the Loan
request and stating that the representations and warranties in section 5
are true and correct as of the date of the request and that no event of
default has occurred and is continuing or would result from such Loan.
5. REPRESENTATIONS. Customer represents and warrants to Lender that on the
date of each Loan:
a. No part of any Loan will be used for personal, family, household or
agricultural purposes.
b. Customer will not use any part of the proceeds of Loans to purchase
any margin stock within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System.
c. The execution and delivery of this Agreement and the Security
Documents, and the performance by Customer of its obligations under
this Agreement and the Security Documents, are within its power, have
been duly authorized by proper action on the part of Customer, are not
in violation of any existing law, rule or regulation, any order or
decision of any court, the articles of incorporation, bylaws, articles
of organization, operating agreement, partnership agreement or other
governing documents of Customer, as applicable, or the terms of any
agreement or restriction to which Customer is a party or by which it
is bound, and do not require the approval or consent of any person or
entity. This Agreement and the Security Documents, when executed and
delivered, will constitute the valid and binding obligations of
Customer enforceable in accordance with their terms.
d. Customer is a corporation validly existing and in good standing under
the laws of the State of Nevada and is duly qualified to do business
and is in good standing in every jurisdiction in which the nature of
its business or its ownership of properties requires such
qualification.
e. All financial statements of Customer furnished to Lender were prepared
in accordance with generally accepted principles of accounting
consistently applied throughout the periods involved and are correct
and complete as of their dates.
f.
i. There is no substance which has been, is or will be present,
used, stored, deposited, treated, recycled or disposed of on,
under in or about any real estate now or at any time owned or
occupied by Customer ("Property") during the period of Customer's
ownership or use of the Property in a form, quantity or manner
which is known to be present on, under, in or about the Property
would require clean-up, removal or some other remedial action
("Hazardous Substance") under any federal, state or local laws,
regulations, ordinances, codes or rules ("Environmental Laws");
ii. Customer has no knowledge, after due inquiry, or any prior use or
existence of any Hazardous Substance on the Property by any prior
owner of or person using the Property;
iii. without limiting the generality of the foregoing, Customer has no
knowledge, after due inquiry, that the Property contains
asbestos, polychlorinated biphenyl components (PCBs) or
underground storage tanks;
iv. there are no conditions existing currently or likely to exist
during the term of this Agreement which would subject Customer to
any damages, penalties, injunctive relive or clean-up costs in
any governmental or regulatory action or third-party claim
relating any Hazardous Substance;
v. Customer is not subject to any court or administrative
proceeding, judgment, decree, order or citation relating to any
Hazardous Substance; and
vi. Customer in the past has been, at the present is, and in the
future will remain in compliance with all Environmental Laws.
Customer shall indemnify and hold harmless Lender, its directors,
officers, employees and agents from all loss, cost (including
reasonable attorneys' fees and legal expenses), liability and
damage whatsoever directly or indirectly resulting from, arising
out of, or based upon
1. the presence, use, storage, deposit, treatment, recycling or
disposal, at any time, of any Hazardous Substance described
above on, under, in or about the Property, or the
transportation of any Hazardous Substance to or from the
Property,
2. the violation or alleged violation of any Environmental Law,
permit, judgment or license relating to the presence, use,
storage, deposit, treatment, recycling or disposal of any
Hazardous Substance on, under in or about the Property, or
the transportation of any Hazardous Substance to or from the
Property,
3. the imposition of any governmental lien for the recovery of
environmental clean-up costs expended under any
Environmental Law, or
4. breach of this representation or warranty.
Customer shall immediately notify Lender in writing of any
governmental or regulatory action or third-party claim instituted
or threatened in connection with any Hazardous Substance on, in,
or about the Property.
g. There is no litigation or administrative proceeding pending or, to the
knowledge of Customer, threatened against Customer which might result
in any material adverse change in the business or condition of
Customer.
6. FEES. Customer agrees to pay the following nonrefundable fees as a
condition of access to credit under this Agreement:
a. Commitment fee in the amount of $2,750.00
b. Commitment fee in an amount equal to 0.25% per year of the average
daily unused portion of the Credit Limit from the date of this
Agreement until the Termination Date specified in section 15, payable
on the last date of each year.
7. CAPITAL ADEQUACY. If Lender shall determine that any existing or future
law, rule, regulation, directive, interpretation, treaty or guideline
regarding capital adequacy (whether or not having the force of law)
increases or would increase, from that required on the date of this
Agreement, the amount of capital required or expected to be maintained by
the Lender, or any corporation controlling Lender, and if such increase is
based upon the existence of Lender's obligations under this Agreement and
other commitments of this type, then from time to time within ten days
after demand from Lender, the Customer shall pay to Lender such amount or
amounts as will compensate Lender for expenses or costs required to meet
such increased capital requirement. For purposes of calculating the amount
of compensation required, Lender, or and corporation controlling Lender,
may conclusively be deemed to have maintained the minimum amount of capital
required on the date of this Agreement, and may base such compensation on
the assumption that Lender (or such corporation) will need to increase its
capital from such minimum amount to the new required amount. The
determination of any amount to be paid by Customer under this section shall
take into consideration policies of Lender, or any corporation controlling
Lender, with respect to capital adequacy and shall be based upon a
reasonable method of attribution. A certificate of Lender setting forth
such amount or amounts as shall be necessary to compensate Lender and is
specified in this section shall be delivered to Customer and shall be
conclusive absent manifest error.
8. INTEREST RATE AND OTHER CHARGES. Customer agrees to pay interest to Lender
on the unpaid principal balance outstanding from time to time under this
Agreement:
a. At a rate per year equal to 0.000 percentage points over the prime
rate in effect at the Xxxxxxxx & Xxxxxx Bank, Milwaukee, WI, from time
to time, ("Index Rate"). The Index Rate may or may not be the lowest
rate charged by Lender. Any change in the interest rate resulting
from a change in the Index Rate shall become effective without notice
to Customer as of the day on which such change in the Index Rate
becomes effective. A change in the interest rate will apply both to
the outstanding principal balance and to new Loans. If the Index Rate
ceases to be made available to Lender during the term of the
Agreement, Lender may substitute a comparable index.
b. Interest under a. is computed on the basis of the actual number of
days the principal balance is unpaid based upon a year of 360 days.
If any payment (other than the final payment) is not made on or before
the 15th day after its due date, Lender may collect a delinquency
charge of 3.00% of the unpaid amount. Unpaid principal and interest
bear interest after maturity (whether by acceleration or lapse of
time) until paid at the rate which would otherwise be applicable plus
3.000 percentage points.
9. PAYMENT SCHEDULE. Customer agrees to pay to Lender the unpaid principal
balance and interest as follows:
a. In payments of interest, beginning November 1, 2000, and on the same
day of each succeeding month thereafter, plus a final payment of
unpaid principal and interest due on the Termination Date specified in
section 15.
In addition, Customer shall immediately pay any amount by which the
Loans exceed the Credit Limit or the Borrowing Base established under
section 2, if any, and any prior unpaid payments. Lender is
authorized to automatically change payments due under this Agreement
to any account of Customer with Lender. If payments are not
automatically charged to Customer's account, payments must be made to
the Lender at its address shown above and are note credited until
received in Lender's office. Lender is authorized to make book
entries evidencing Loans and payments under this Agreement and the
aggregate unpaid amount of all Loans as evidenced by those entries is
presumptive evidence that those amounts are outstanding and unpaid to
Lender.
10. COVENANTS. Customer shall, so long as any amounts remain unpaid, or
Lender has any commitment to make Loans under this Agreement:
a. Furnish to Lender, as soon as available, such financial information
respecting Customer as Lender from time to time requests, and without
request furnish to Lender:
i. Within 90 days after the end of each fiscal year of Customer a
balance sheet of Customer as of the close of such fiscal year and
related statements of income and retained earnings and cash flow
for such year all in reasonable detail and satisfactory in scope
to Lender, prepared in accordance with generally accepted
principles of accounting applied on a consistent basis, certified
by an independent certified public accountant acceptable to
Lender and the chief financial representative of Customer, and
ii. Within 45 days after the end of each third month a balance sheet
of Customer as of the end of such month and related statements of
income and retained earnings and cash flow for the period from
the beginning of the fiscal year to the end of such month,
prepared in accordance with generally accepted principles of
accounting applied on a consistent basis, certified, subject to
normal year-end adjustments, by an officer or partner of
Customer.
b. Keep complete and accurate books of records and accounts and permit
any representatives of Lender to examine and copy any of the books and
to visit and inspect any of Customer's tangible or intangible
properties as often as desired.
c. Maintain insurance coverage in the forms (together with any lender's
loss payee clause requested by Lender), amounts and with companies
which would be carried by prudent management in connection with
businesses engaged in similar activities in similar geographic areas.
Without limiting this section or the requirements of any Security
Document, Customer will
i. Keep all its physical property insured against fire and extended
coverage risks in amounts and with deductibles as least equal to
those generally maintained by businesses engaged in similar
activities in similar geographic areas,
ii. Maintain all such workers' compensation and similar insurance as
may be required by law and
iii. Maintain, in amounts and with deductibles at least equal to those
generally maintained by businesses engaged in similar activities
in similar geographic areas, general public liability insurance
against claims for bodily injury, death or property damage
occurring on, in or about the properties of Customer, business
interruption insurance and product liability insurance.
d. Pay and discharge all lawful taxes, assessments and governmental
charges upon Customer or against its properties prior to the date on
which penalties attach, unless and to the extent only that such taxes,
assessments and charges are contested in good faith and by appropriate
process by Customer.
e. Do all things necessary to maintain its existence, to preserve and
keep in full force and effect its rights and franchises necessary to
continue its business and comply with all applicable laws, regulations
and ordinances.
f. Timely perform and observe the following financial covenants, all
calculated in accordance with generally accepted principles of
accounting applied on a consistent basis:
i. Maintain at all times a ratio of funded debt to tangible net
worth of not greater than 2.00 to one.
ii. Maintain at all time a ratio of collateral base to funded debt of
not less than 1.1 to one.
g. Furnish to Lender the Borrowing Base Certificates required under
Exhibit A, if any.
h. Not create or permit to exist any lien or encumbrance with respect to
Customer's properties, except liens in favor of Lender, liens for
taxes if they are being contested in good faith by appropriate
proceedings and of which appropriate reserves are maintained, liens of
encumbrances permitted under any Security Document.
i. Not take any action or permit any event to occur which materially
impairs Customer's ability to make payments under this Agreement when
due. Such events include, without limitation, the fact that Customer,
Customer's spouse or any surety for Customer's obligations under this
Agreement ceases to exist, dies, changes marital status or domicile or
becomes insolvent or the subject of bankruptcy or insolvency
proceedings.
j. Timely perform all duties and responsibilities imposed on Customer
under Section 5(f).
k. Unless otherwise consented to in writing by Lender, timely perform and
observe all additional covenants described on Exhibit C.
11. SECURITY INTEREST. This Agreement is secured by all existing and future
security agreements, assignments and mortgages from Customer to Lender,
from any guarantor of this Agreement Lender, and from any other person to
Lender providing collateral security for customer obligations, and payment
of the Loans may be accelerated according to any of them. Unless a lien
would be prohibited by law or would fender a nontaxable account taxable,
Customer also grants to Lender a security interest and lien in any deposit
account Customer may at any time have with Lender. Lender may at any time
after the occurrence of an event of default set-off any amount unpaid
under this Agreement against any deposit balances or other money now or
hereafter owed to Customer by Lender.
12. DEFAULT AND ACCELERATION. Upon the occurrence of any one or more of the
following events of default:
a. Customer fails to pay an amount when due under this Agreement or under
any other instrument evidencing any indebtedness of Customer,
b. Any representation or warranty made under this Agreement or
information provided by Customer in connection with this Agreement is
or was false or fraudulent in a material respect,
c. A material adverse change occurs in customer's financial condition,
d. Customer fails to timely observe or perform any of the covenants or
duties contained in this Agreement,
e. Any guaranty of Customer's obligations under this Agreement is revoked
or becomes unenforceable for any reason or any such guarantor dies or
ceases to exist, or
f. An event of default occurs under any Security Document;
then, at Lender's option, and upon written or verbal notice to Customer,
Lender's obligation to make Loans under this Agreement shall terminate
and the total unpaid balance shall become immediately due and payable
without presentment, demand, protest, or further notice of any kind all
of which are hereby expressly waived by Customer. Lender's obligation
to make loans under this Agreement shall automatically terminate and the
total unpaid balance shall automatically become due and payable in the
event Customer becomes the subject of bankruptcy or other insolvency
proceedings. Lender may waive any default without waiving any other
subsequent or prior default. Customer agrees to pay Lender costs of
administration of this Agreement. Customer also agrees to pay all costs
of collection before and after judgment, including reasonable attorneys'
fees (including those incurred in successful defense or settlement of
any counterclaim brought by Customer or incident to any action or
proceeding involving Customer brought pursuant to the United Stated
bankruptcy Code).
13. INDEMNIFICATION. Customer agrees to defend, indemnify and hold harmless
Lender, its directors, officers, employees and agents, from and against any
and all loss, cost, expense, damage or liability (including reasonable
attorneys' fees) incurred in connection with any claim or counterclaim or
proceeding brought as a result of, arising out of or relating to any
transaction financed or to be financed, in whole or in part, directly or
indirectly, with the proceeds of any Loan or the entering into and
performance of this Agreement or any document or instrument relating to
this Agreement by Lender or the activities of customer. This indemnity
will survive termination of this Agreement, the repayment of all Loans and
the discharge and release of any Security Documents.
14. VENUE. To the extent not prohibited by law, venue for any legal proceeding
relating to enforcement of this Agreement shall be, at Lender's option, the
county in which Lender has its principal office in this state, the county
in which Customer resides, or the county in which this Agreement was
executed by Customer.
15. TERMINATION. Unless sooner terminated under section 12, Customer's right
to obtain Loans and Lender's obligation to extend credit under this
Agreement shall terminate on October 9, 2003 (the "Termination Date").
Customer may terminate Customer's right to obtain Loans under this
Agreement at any time and for any reason by written notice to the Lender.
Such notice of termination signed by a Customer shall be binding on each
Customer who signs this Agreement. Termination, for whatever reason, does
not affect Lender's rights, powers and privileges, nor Customer's duties
and liabilities, with regard to the then existing balance under this
Agreement. See Note ***
Note ***: However, since the Lender and Customer agree that this loan
is intended to be a three year renewable revolving credit agreement, the
Lender, at its election and Customer's acceptance, may add one year to the
previously stated termination date upon the satisfactorily completion of an
annual performance review by Lender and Customer. The annual performance
review must be performed within 20 days after the Lender receives the
Customer's Audited Consolidate Financial Statements.
Should either party decline to extend the revolving credit agreement for
another year, the declining party is required to send a notice as described
in section 20 of this agreement to the other party within 30 days from the
date the Lender received the Customer's Audited consolidated Financial
Statements. In the case of the annual renewal being declined by either
party, the termination date will remain as noted in this revolving credit
agreement or as later modified in writing between the Lender and Customer
under the terms of this three year renewable revolving credit agreement
provision.
16. AMENDMENT. No amendment, modification, termination or waiver of any
provision of this Agreement shall in any event be effective unless it is in
writing and signed by Lender, and then such waiver or consent shall be
effective only in the specific instance and for the specific purposes for
which given.
17. ENTIRE AGREEMENT. This Agreement, including the Exhibits attached or
referring to it, and the Security Documents, are intended by Customer and
Lender as a final expression of their Agreement and as a complete and
exclusive statement of its terms, there being no conditions to the full
effectiveness of this Agreement except as set forth in this Agreement and
the Security Documents.
18. NO WAIVER; REMEDIES. No failure on the part of Lender to exercise, and no
delay in exercising, any right, power or remedy under this Agreement shall
operate as a waiver of such right, power or remedy; nor shall any single or
partial exercise of any right under this Agreement preclude any other or
further exercise of the right or the exercise of any other right. The
remedies provided in this Agreement are cumulative and not exclusive of any
remedies provided by law.
19. MORE THAN ONE CUSTOMER. If more than one person signs this Agreement as
Customer, Lender may at its option and without notice refuse any request
for a Loan upon notice from any of the undersigned. Any of the undersigned
Customers may request Loans under this Agreement. Each of the undersigned
Customers is jointly and severally liable for all Loans and other
obligations under this Agreement.
20. NOTICE. Except as otherwise provided in this Agreement, all notices
required or provided for under this Agreement shall be in writing and
mailed, sent or delivered, if to Customer, at any last known address as
shown on the records of Lender, and if to Lender, at its address shown
below, or, as to each party, at such other address as shall be designated
by such party in a written notice to the other party. All such notices
shall be deemed duly given when delivered by hand or courier, or three
business days after being deposited in the mail (including any private mail
service), postage prepaid, provided that notice to Lender pursuant to
section 15 shall not be effective until received by Lender.
21. ADDRESS. Customer's address is shown below. Customer shall immediately
notify Lender in writing of any change of address.
22. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure to
the benefit of Lender and Customer and their respective heirs, personal
representatives, successors and assigns except that Customer may not assign
or transfer any of Customer's rights under this Agreement without the prior
written consent of Lender.
23. INTERPRETATION. The validity, construction and enforcement of this
Agreement are governed by the internal laws of Wisconsin. Invalidity of
any provision of this Agreement shall not affect the validity of any other
provisions of this Agreement.
24. Other Provision. None.
Dated as of October 9, 2000
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Lincoln State Bank OnCourse Technologies, Inc.
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(Name of Lender) (Name Of Customer)
By: /s/ Xxxxxx X. Xxxx A Nevada Corporation
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Xxxxxx X. Xxxx (Type of Organization)
Vice President
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(Title)
0000 Xxxxx 00xx Xxxxxx
Xxxxxxxxx, XX 00000 By: /s/ Xxxxxxx X. Xxxxx (CEO)
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(Address) Xxxxxxx X. Xxxxx III
Chief Executive Officer
By: /s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx
Chief Financial Officer
0000 X. 000xx Xxxxxx
Xxx Xxxxxx, XX 00000
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(Address)
EXHIBIT A
TO
REVOLVING CREDIT AGREEMENT (WBA 448R)
DATED OCTOBER 9, 2000
BORROWING BASE (SECTION 2)
A. DEFINITIONS.
a. "QUALIFIED INVENTORY" for the purposes of this agreement shall include
only net capitalized software.
b. "QUALIFIED ACCOUNTS" means an account owing to Customer which meets
the following specifications:
i. It arose from the performance of service by Customer, or from a
bona fide sale or lease of goods which have been delivered or
shipped to the account debtor and for which Customer has genuine
invoices, shipping documents or receipts.
ii. It is payable not more than 90 days from the earlier of
performance of the services, delivery of goods or date of
invoice, and is not more than 90 days past due.
iii. It is owned by Customer free and clear of all encumbrance and
security interests (other than Lender's).
iv. It is genuine and enforceable against the account debtor for the
amount shown as owing in the certificates furnished by Customer
to Lender. It and the transaction out of which it arose comply
with all applicable laws and regulations. It is not subject to
any set-off, credit allowance or adjustment, except discount for
prompt payment, nor has the account debtor returned the goods or
disputed his liability.
v. Its existence and amount have been certified to in a manner
satisfactory to Lender by a representative of Customer at such
times as Lender may request.
vi. Customer has no notice or knowledge of anything which might
impair the credit standing of the account debtor.
vii. Lender has not notified Customer that the account or account
debtor is unsatisfactory.
B. BORROWING BASE. The aggregate amount of all Loans at any time outstanding
under the Agreement shall never exceed the Borrowing Base which is an
amount equal to the sum of:
a. QUALIFIED INVENTORY. For the purposes of this agreement includes only
net capitalized software: 30% of capitalized software net of
amortization.
b. QUALIFIED ACCOUNTS: 75% of the amount owing on Qualified Accounts;
plus 35% on Unqualified Accounts described as accounts with due dates
greater than 90 days from invoice or greater than 90 days past due
from invoice due date; plus
c. FIXED ASSETS: 50% of fixed assets net of depreciation.
APPROVED
For Lender by: /s/ Xxxxxx X. Xxxx as Vice Pres
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For Customer by: /s/ Xxxxxxx X. Xxxxx as CFO
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EXHIBIT B
TO
REVOLVING CREDIT AGREEMENT (WBA 448R)
DATED OCTOBER 9, 2000
SECURITY DOCUMENTS (SECTION 3(A))
A. General Business Security Agreement from customer and each wholly owned
subsidiary including but not limited to Micro Estimating Systems, Inc., CAM
Solutions, Inc., Cimtronics, Inc. and TekSoft, Inc.
B. Chattel Security Agreement covering from customer and each wholly owned
subsidiary including but not limited to Micro Estimating Systems, Inc., CAM
Solutions, Inc., Cimtronics, Inc. and TekSoft, Inc. covering equipment
purchased with funds drawn under this agreement.
APPROVED
For Lender by: /s/ Xxxxxx X. Xxxx as Vice Pres
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For Customer by: /s/ Xxxxxxx X. Xxxxx as CFO
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EXHIBIT C
TO
REVOLVING CREDIT AGREEMENT (WBA 448R)
DATED OCTOBER 9, 2000
ADDITIONAL COVENANTS (SECTION 10(K))
A. DISTRIBUTIONS. Customer will not pay or declare any dividends or make
any other distribution based upon the stock of or other ownership
interest in Customer (except dividends payable solely in stock of
Customer) or make any purchases, redemptions or other acquisitions,
direct or indirect, of stock of or other ownership interest in Customer.
B. MERGERS. If Customer is a corporation or a limited liability company,
Customer will not merge or consolidate with or into any other entity or
if Customer is a partnership or a limited liability company, Customer
will not dissolve or liquidate, and in any event, Customer will not
sell, lease or transfer or otherwise dispose of all or a substantial part
of its assets (other than sales made in the ordinary course of
business).
C. CONDUCT OF BUSINESS. Customer will continue to engage in an efficient
and economical manner in a business of the same general type as
conducted by it on the date of this Agreement.
D. SALES OF RECEIVABLES. Customer will not discount or sell with recourse
any of its notes or accounts receivable.
E. SALES AND LEASEBACKS. Customer will not sell or transfer any fixed
assets and then or thereafter rent or lease as lessee any such assets.
F. DEBT. Customer will not incur, assume or permit to exist any
indebtedness or liability for borrowed money (except obligations under
this Agreement) or assume, guarantee, endorse or otherwise become liable
for obligation of another (except endorsements of negotiable instruments
for deposit or collection in the ordinary course of business), except:
loans not exceeding $75,000 per transaction nor aggregating more than
$250,000 in any fiscal year of customer.
APPROVED
For Lender by: /s/ Xxxxxx X. Xxxx as Vice Pres
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For Customer by: /s/ Xxxxxxx X. Xxxxx as CFO
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