Xxxxx Fargo Bank Iowa, Second Amended and Restated Credit
National Association Agreement
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THIS SECOND AMENDED AND RESTATED CREDIT AGREEMENT (the "Agreement") dated as of
March 28, 2002 (the "Effective Date") is between Xxxxx Fargo Bank Iowa, National
Association (the "Bank") and Patient Infosystems, Inc. (the "Borrower").
BACKGROUND
The Borrower and the Bank entered into an Amended and Restated Credit Agreement,
dated as of March 28, 2001 (the "Existing Credit Agreement') pursuant to which
the Bank made available to the Borrower a $2,500,000 revolving line of credit.
The Borrower has asked the Bank to renew its existing $2,500,000.00 revolving
line of credit, which the Borrower uses for general business purposes.
Borrowings under the line are currently evidenced by a $2,500,000.00 promissory
note dated March 28, 2001 (the "2001Note").
The Bank is agreeable to meeting the Borrower's request, provided that the
Borrower agrees to the terms and conditions of this Agreement. The Revolving
Note (defined in Section 1.3 below), this Agreement, and all "Security
Documents" described in Exhibit A may collectively be referred to as the
"Documents."
In consideration of the promises contained in this Agreement, the Borrower and
the Bank agree as follows:
1. LINE OF CREDIT
1.1 Line of Credit Amount. During the Line Availability Period defined below,
the Bank agrees to provide a revolving line of credit (the "Line") to the
Borrower. Outstanding amounts under the Line will not, at any one time,
exceed TWO MILLION FIVE HUNDRED THOUSAND DOLLARS and 00/100 Dollars
($2,500,000.00).
1.2 Line Availability Period. The "Line Availability Period" will mean the
period of time from the date on which all conditions precedent described in
this Agreement have been metthrough and including March 31, 2003 (the "Line
Expiration Date").
1.3 Advances. The Borrower's obligation to repay advances made under the Line
will be evidenced by a single promissory note (the "Revolving Note") dated
as of the Effective Date and in form and content acceptable to the Bank.
Reference is made to the Revolving Note for interest rate and repayment
terms. The Revolving Note will replace, but not be deemed to satisfy, the
2001 Note. As of March 26, 2002, the unpaid principal balance of the 2001
Note is $2,500,000.00 and accrued but unpaid interest is $11,096.31.
Reference is made to the Revolving Note for interest rate and repayment
terms.
2. EXPENSES
2.1 Origination Fee. The Borrower shall pay to the Bank an origination fee of
$2,500.00, which shall be paid at closing, and which shall be deemed to be
earned upon payment by the Borrower.
2.2 Commitment Fee. During the Line Availability Period the Borrower shall pay
the Bank a commitment fee of 0.25% per annum on the average daily unused
amount of the Line. This fee shall be calculated on the basis of actual
days elapsed in a 360 day year and paid quarterly in arrears beginning June
30, 2002.
2.3 Documentation Expense. The Borrower agrees to reimburse the Bank for its
reasonable expenses relating to the preparation of the Documents and any
possible future amendments to the Documents, which reimbursement may
include, but shall not be limited to, reimbursement of reasonable
attorneys' fees, including the allocated costs of the Bank's in-house
counsel. Despite such reimbursement the Borrower acknowledges that the
Bank's counsel is engaged solely to represent the Bank and does not
represent the Borrower.
2.3 Collection Expenses. In the event the Borrower fails to pay the Bank any
amounts due under this Agreement or under the Documents, the Borrower will
pay all costs of collection, including reasonable attorneys' fees and legal
expenses incurred by the Bank.
3. DISBURSEMENTS AND PAYMENTS
3.1 Requests for Advances. Any Line advance permitted under this Agreement must
be requested by telephone or in a writing delivered to the Bank (or
transmitted via facsimile) by any person reasonably believed by the Bank to
be an authorized officer of the Borrower. The Bank will not consider any
such request if there is an event which is, or with notice or the lapse of
time would be, an event of default under this Agreement. Proceeds will be
deposited into the Borrower's account at the Bank or disbursed in such
other manner as the parties agree.
3.2 Interest Rate Option Based on LIBOR. In addition to interest rates based on
the Base Rate Option defined in the Revolving Note, the Borrower may elect
to fix a rate of interest for an agreed upon period of time and principal
amount agreeable to the Bank and Borrower based upon the margin stated in
the Revolving Note and at an interest rate derived from the current LIBOR
rate available to the Bank on national or international money markets for a
similar time period and dollar amount.
In order to elect the LIBOR Rate Option, as defined in the Revolving Note,
the Borrower must request a quote from the Bank two days prior to funding.
This request must designate an amount (the "LIBOR Rate Portion") and a
period (the "LIBOR Interest Period"). The LIBOR Rate Portion must be at
least $100,000 and the LIBOR Interest Period will be for 30, 60 or 90 days
or such other period to which the parties may agree. The Bank shall not be
obligated to provide a LIBOR rate quote if it determines that no deposits
with an amount and maturity equal to those for which a quotation has been
requested are available to it in the London interbank market. The Borrower
must orally accept a quote when received or it will be deemed rejected. If
accepted, the LIBOR Rate Option will remain in effect for the LIBOR
Interest Period specified in the quote. At the end of each LIBOR Interest
Period the principal amount subject to the LIBOR Rate Option shall bear
interest at the Base Rate Option (as defined in the Revolving Note).
3.3 Payments. All principal, interest and fees due under the Documents shall be
paid in immediately available funds as contracted in this Agreement and no
later than the payment due date set forth in the statement mailed to the
Borrower by the Bank. Should a payment come due on a day other than a day
on which the Bank is open for substantially all of its business (a "Banking
Day", except as otherwise provided), then the payment shall be made no
later than the next Banking Day. For amounts bearing interest at the LIBOR
Rate (if any) a Banking Day is a day on which the Bank is open for
substantially all of its business and on which dealings in U.S. dollar
deposits are carried on in the London interbank market.
4. SECURITY
All amounts due under this Agreement and the Documents will be secured as
provided in Exhibit A. The Security Documents listed in Schedule 1 of Exhibit A
were delivered to the Bank prior to the Effective Date and the Bank shall
continue to rely on the Security Documents as security for the amounts due under
this Agreement and the Documents. The Security Documents listed in Schedule 2 of
Exhibit A shall be delivered to the Bank pursuant to Section 5, below, and the
Bank shall also rely on such Security Documents as security for the amounts due
under this Agreement and the Documents. The Borrower also hereby grants the Bank
a security interest (independent of the Bank's right of set-off) in its deposit
accounts at the Bank and in any other debt obligations of the Bank to the
Borrower.
5. CONDITIONS PRECEDENT
Notwithstanding the execution of this Agreement, or the delivery of all
Documents in furtherance thereof, this Agreement and the Revolving Note shall
only become effective upon the timely satisfaction of the following conditions
precedent: (a) The Borrower shall have delivered to the Bank the documents
described in Schedule 2 of Exhibit A, properly executed and in form and content
acceptable to the Bank and such documents shall have been filed of record and
recorded as necessary or appropriate with such verification of filing and
priority as may be required by the Bank.
(b) The Borrower shall have paid to the Bank unpaid interest accrued on the
2001 Note through March 26, 2002, in the amount of $11,096.31.
(c) The Borrower shall have reimbursed the Bank for all expenses and fees,
including, without limitation, attorney's fees, incurred by the Bank in
connection with the negotiation and preparation of the Documents.
Upon this Agreement and the Revolving Note becoming effective, (i) the Existing
Credit Agreement and the 2001 Note shall be deemed to have been replaced by this
Agreement and the Revolving Note, respectively, (ii) the Arbitration Agreement,
dated December 23, 1999, between the Borrower and the Bank shall be deemed to be
terminated, and (iii) the letter agreement, dated March 28, 2001, between the
Bank and the Personal Guarantor (defined below), a copy of which is attached,
shall be deemed to be terminated.
6. REPRESENTATIONS AND WARRANTIES
To induce the Bank to enter into this Agreement, the Borrower, to the best of
its knowledge and upon due inquiry, makes the representations and warranties
contained in Exhibit B. Each request for an advance under this Agreement
constitutes a reaffirmation of these representations and warranties.
7. COVENANTS
Until all amounts due under the Documents are paid in full, unless the Bank
shall otherwise agree in writing, the Borrower agrees to:
7.1 Financial Information
(a) Annual Financial Statements. Provide the Bank within 120 days of the
Borrower's fiscal year end, the Borrower's annual audited financial
statements.
(b) Notices. Provide the Bank prompt written notice of (1) any event which has
or might after the passage of time or the giving of notice, or both,
constitute an event of default under the Documents, or (2) any event that
would cause the representations and warranties contained in this Agreement
to be untrue.
(c) Additional Information. Provide the Bank with such other information as it
may reasonably request, and permit the Bank to visit and inspect its
properties and examine its books and records.
7.2 Other Covenants
(a) Nature of Business. Refrain from engaging in any line of business
materially different from that presently engaged in by the Borrower.
(b) Books and Records. Maintain adequate books and records consistent with
sound business practices.
(c) Compliance with Laws. Comply in all material respects with all laws
applicable to its business and the ownership of its property.
(d) Preservation of Rights. Maintain and preserve all rights, privileges,
charters and franchises it now has, excluding sale of assets in the
ordinary course of business and the loss of a management contract with
independent physicians.
These covenants were negotiated by the Bank and Borrower based on information
provided to the Bank by the Borrower. A breach of a covenant is an indication
that the risk of the transaction has increased. As consideration for any waiver
or modification of these covenants, the Bank may require: additional collateral,
guaranties or other credit support; higher fees or interest rates; and possible
modifications to the Documents and the monitoring of the Agreement. The waiver
or modification of any covenant that has been violated by the Borrower will be
made in the sole discretion of the Bank. These options do not limit the Bank's
right to exercise its rights under Section 8 of this Agreement.
8. EVENTS OF DEFAULT AND REMEDIES
8.1 Default
Upon the occurrence of any one or more of the following events of default, or at
any time afterward unless the default has been cured, the Bank may declare the
Line to be terminated and in its discretion accelerate and declare the unpaid
principal, accrued interest and all other amounts payable under the Revolving
Note to be immediately due and payable:
(a) Default by the Borrower in the payment when due of any principal or
interest due under the Revolving Note and continuance for twenty (20) days.
(b) Default by the Borrower in the observance or performance of any covenant or
agreement contained in this Agreement, and continuance for more than twenty
(20) days.
(c) Default by the Borrower in the observance or performance of any covenant or
agreement contained in the Documents, or any of them, excluding this
Agreement, after giving effect to any applicable grace period.
(d) Default by the Borrower in an amount exceeding $100,000.00 in any agreement
with the Bank or any other lender that relates to indebtedness or
contingent liabilities which would allow the maturity of such indebtedness
to be accelerated.
(e) Any representation or warranty made by the Borrower to the Bank in this
Agreement, or in any financial statement or report submitted to the Bank by
or on behalf of the Borrower or by or on behalf of the Personal Guarantor
(defined below) before or after the Effective Date is untrue or misleading
in any material respect.
(f) Any litigation or governmental proceeding against the Borrower seeking an
amount that would have a material adverse effect on the Borrower or the
Borrower's operations and which is not insured or subject to indemnity by a
solvent third party either 1) results in a judgment equal to or in excess
of that amount against the Borrower or 2) remains unresolved on the 270th
day following its filing.
(g) A garnishment, levy or writ of attachment, or any local, state, or federal
notice of tax lien or levy is served upon the Bank for the attachment of
property of the Borrower in the Bank's possession or indebtedness owed to
the Borrower by the Bank.
(h) Xxxx Xxxxxxxxx, or any other person who personally guaranties indebtedness
of the Borrower, (the "Personal Guarantor") dies or becomes insolvent or is
the subject of a voluntary or involuntary petition under the United States
Bankruptcy Code, or the Personal Guarantor is in default with respect to
any liabilities or indebtedness owed to the Bank which would permit the
Bank to accelerate his indebtedness.
(i) The issuer of any one of the Standby L/Cs described in Exhibit A is placed
into receivership by the FDIC or advises the Bank that it intends to
repudiate its obligations to the Bank under the Standby L/C issued by it.
8.2 Immediate Default
(a) On the Line Expiration Date, the Line shall immediately terminate and the
unpaid principal, accrued interest and all other amounts under the
Revolving Note and the Documents will become immediately due and payable
without notice or demand.
(b) If, with or without the Borrower's consent, a custodian, trustee or
receiver is appointed for any of the Borrower's properties, or if a
petition is filed by or against the Borrower under the United States
Bankruptcy Code, then the Line shall immediately terminate and the unpaid
principal, accrued interest and all other amounts payable under the
Revolving Note and the Documents will become immediately due and payable
without notice or demand.
9. LIMITATION AND INDEMNIFICATION OF LIABILITY.
The Bank shall not be liable or responsible to the Borrower, the Personal
Guarantor, or any third party, in connection with its conduct or performance
under this Agreement, or any of the Documents, except for acts of gross
negligence or willful misconduct, and the Borrower shall indemnify the Bank and
hold the Bank harmless against all claims, actions, suits, proceedings, costs,
expenses, losses, damages and liabilities of any kind, including tort, penalties
and interest, whether made by the Borrower, the Personal Guarantor or any third
party, in connection with any act of the Bank, directly or indirectly, in
connection with this Agreement, or the Documents, except for acts of gross
negligence or willful misconduct of the Bank.
These provisions and conditions shall survive the payment of all
obligations to the Bank.
10. WAIVER OF CLAIMS
The Borrower does hereby release and forever discharge the Bank, Xxxxx Fargo &
Company and their officers, directors, attorneys, agents, employees, successors
and assigns from all causes of action, suits, claims and demands of every kind
and character, liquidated or unliquidated, fixed, contingent, direct or indirect
without limit, including any action in law or equity, which the Borrower now has
or may ever have had against them, if the circumstances giving rise to such
causes of action, suits, claims and demands arose prior to the date of this
Agreement.
This Section 10 shall survive the payment of all obligations to the Bank.
11. MISCELLANEOUS
(a) 360 Day Year. All interest and fees due under this Agreement will be
calculated on the basis of actual days elapsed in a 360 day year.
(b) GAAP. Except as otherwise stated in this Agreement, all financial
information provided to the Bank and all calculations for compliance with
financial covenants will be made using generally accepted accounting
principles consistently applied ("GAAP").
(c) No Waiver; Cumulative Remedies. No failure or delay by the Bank in
exercising any rights under this Agreement shall be deemed a waiver of
those rights. The remedies provided for in the Agreement are cumulative and
not exclusive of any remedies provided by law.
(d) Amendments or Modifications. Any amendment or modification of this
Agreement must be in writing and signed by the Bank and Borrower. Any
waiver of any provision in this Agreement must be in writing and signed by
the Bank.
(e) Binding Effect: Assignment. This Agreement and the Documents are binding on
the successors and assigns of the Borrower and Bank. The Borrower may not
assign its rights under this Agreement and the Documents without the Bank's
prior written consent. The Bank may sell participations in or assign this
Agreement and the Documents and exchange financial information about the
Borrower with actual or potential participants or assignees.
(f) Iowa Law. This Agreement and the Documents will be governed by the
substantive laws of the State of Iowa. Any action to enforce the provisions
of this Agreement and the Documents or arising from the actions of any
party in connection therewith, shall be brought in the United States
District Court for the Southern District of Iowa or in the Iowa District
Court in Polk County, Iowa, except such action as may be necessary by the
Bank to protect, preserve and realize its security interest in collateral
located in another jurisdiction.
(g) Severability of Provisions. If any part of this Agreement or the Documents
are unenforceable, the rest of this Agreement or the Documents may still be
enforced.
(h) Integration. This Agreement and the Documents describe the entire
understanding and agreement of the parties and supersedes all prior
agreements between the Bank and the Borrower relating to each credit
facility subject to this Agreement, whether verbal or in writing.
(i) The Borrower acknowledges receipt of a copy of the Agreement and all
related documents referenced therein and executed by the Borrower in
connection with the Agreement and the indebtedness of the Borrower to the
Bank under the Agreement.
IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD BE READ
CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERNS OR
ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY ENFORCED.
YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEMENT.
THIS NOTICE ALSO APPLIES TO ANY OTHER CREDIT AGREEMENTS (EXCEPT CONSUMER LOANS
OR OTHER EXEMPT TRANSACTIONS) NOW IN EFFECT BETWEEN YOU AND THIS LENDER. BY
SIGNING BELOW THE BORROWER HEREBY ACKNOWLEDGES THAT IT HAS RECEIVED COPIES OF
THIS AGREEMENT AND ALL OTHER DOCUMENTS.
Address for notices to Bank: Address for notices to Borrower:
Xxxxx Fargo Bank Iowa, Patient Infosystems, Inc.
National Association 00 Xxxxxx Xxxxxx
000 Xxxxxx Xxxxxx, X.X. Xxx 000 Xxxxxxxxx, XX 00000
Xxx Xxxxxx, Xxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxxxx, Attention: Xxxx Xxxxxx
Vice President
With a copy to:
Xxxx Xxxxxxxxx
c/o Equity Dynamics
2116 Financial Center
000 Xxxxxx Xxxxxx
Xxx Xxxxxx, Xxxx 00000
Xxxxx Fargo Bank Iowa,
National Association Patient infosystems, inc.
By: /s/Xxxxxx X. Xxxxxxxx By: /s/Xxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxxxx, Vice President Its: Vice President
DC1425E1
EXHIBIT A
SCHEDULE 1 TO EXHIBIT A - EXISTING SECURITY DOCUMENTS
Security Documents
Standby Letters of Credit. The following standby letters of credit (each standby
letter of credit a "Standby L/C") naming the Bank as beneficiary thereunder and
bearing an expiry date of April 30, 2002: 1) Issued by West Des Moines State
Bank for Xxxx Xxxxxxxxx in the amount of $750,000.00; 2) Issued by
Manufactureres and Traders Trust Company for Xxxxxx X. Xxxxxxxx in the amount of
$1,250,000.00. Each Standby L/C supports the obligations of the Borrower under
the Revolving Note.
Personal Guaranty of Xxxx Xxxxxxxxx. The unconditional personal Guaranty of Xxxx
Xxxxxxxxx. Pursuant to the Guaranty, the Guarantor guarantees a maximum of
$580,000.
Personal Line of Credit Reserve Agreement of Xxxx Xxxxxxxxx. An agreement with
Xxxx Xxxxxxxxx whereby he agrees that his personal line of credit with the Bank
will be reserved in the amount of $500,000.00 for purposes of making an advance
to cover his obligations to the Bank under his personal Guaranty referenced
above.
Security Agreement of Borrower. The Security Agreement signed by the Borrower
dated December 23, 1999, granting the Bank a first lien security interest in the
Borrower's accounts, inventory, equipment and general intangibles described in
that Agreement, together with one or more UCC-1 Financing Statements sufficient
to perfect the security interest granted to the Bank in each jurisdiction where
such property is located and the jurisdiction in which the Borrower is
organized.
SCHEDULE 2 TO EXHIBIT A - CONDITIONS PRECEDENT TO INITIAL ADVANCE.
Note
The Revolving Note
Security Documents
Security Agreement of Borrower. A Security Agreement granting the Bank a first
lien security interest in the Borrower's accounts, inventory, equipment and
general intangibles described in that Agreement, together with one or more UCC-1
Financing Statements sufficient to perfect the security interest granted to the
Bank in each jurisdiction where such property is located and the jurisdiction in
which the Borrower is organized.
Standby Letters of Credit. Standby letters of credit (each standby letter of
credit a "Standby L/C") issued by banking institutions and in a form acceptable
to the Bank upon the application of each of the following individuals as account
party in the following amount, naming the Bank as beneficiary thereunder: 1)
Xxxx Xxxxxxxxx, $750,000.00; 2) Xxxxxx X. Xxxxxxxx, $1,250,000.00. Each Standby
L/C will support the obligations of the Borrower under the Revolving Note.
Each Standby L/C shall bear an expiry date of April 30, 2003, and shall permit
the Bank to draw upon it in an amount equal to the amount of the Standby L/C
following a default by the Borrower under the Revolving Note or at any time on
or after March 31, 2003.
Personal Guaranty of Xxxx Xxxxxxxxx. The unconditional personal Guaranty of Xxxx
Xxxxxxxxx. Pursuant to the Guaranty, the Guarantor guarantees a maximum of
$580,000.
Consent and Ratification of Xxxx Xxxxxxxxx. The Bank shall have received the
Consent and Ratification of Xxxx Xxxxxxxxx under which he (i) consents to this
Agreement, (ii) ratifies the $580,000 Personal Guaranty of Xxxx Xxxxxxxxx, (iii)
confirms that $580,000 Personal Guaranty of Xxxx Xxxxxxxxx is in addition to a
Standby L/C provided by him and not in lieu thereof, (iv) agrees that the Bank
may reduce his personal line of credit with the Bank that is evidenced by a
promissory note dated June 26, 2001 in the principal amount of $500,000 for
purposes of supporting such guaranty, (v) permits the Bank, in the event that it
makes demand under such guaranty, to make an advance under his personal line of
credit for purposes of satisfying his obligations under such guaranty.
The Bank must have received a letter, in the form attached as Exhibit "C", from
all of the Facility Guarantors (as that term is defined in such letter).
Authorization
Corporate Certificate of Authority. A certificate of the Borrower's corporate
secretary as to the incumbency and signatures of the officers of the Borrower
signing the Documents and containing a copy of resolutions of the Borrower's
board of directors authorizing execution of the Documents and performance in
accordance with the terms of the Agreement.
Organization
Articles of Incorporation And By - Laws. A certified copy of the Borrower's
Articles of Incorporation and By-Laws and any amendments, if applicable.
Certificate of Good Standing. A copy of the Borrower's Certificate of Good
Standing, recently certified by the Delaware Secretary of State.
DC1425E1
EXHIBIT B
REPRESENTATIONS AND WARRANTIES
Organizational Status. The Borrower is a corporation duly formed and in good
standing under the laws of the State of Delaware.
Chief Executive Office. The Borrower's chief executive office is located at 00
Xxxxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxx.
Authorization. This Agreement, and the execution and delivery of the Documents
required hereunder, is within the Borrower's powers, has been duly authorized
and does not conflict with any of its organizational documents or any other
agreement by which the Borrower is bound, and has been signed by all persons
authorized and required to do so under its organizational documents.
Litigation. There is no litigation or governmental proceeding pending or
threatened against the Borrower which could have a material adverse effect on
the Borrower's financial condition or business, except those disclosed in
Exhibit D attached hereto.
Taxes. The Borrower has paid when due all federal, state and local taxes.
No Default. Except as otherwise disclosed to the Bank prior to the date hereof,
there is no event which is, or with notice or the lapse of time would be, an
event of default under this Agreement.
ERISA. The Borrower is in compliance in all material respects with ERISA and has
received no notice to the contrary from the PBGC or other governmental entity.
Environmental Matters. (1) The Borrower is in compliance in all material
respects with all health and environmental laws applicable to the Borrower and
its operations and knows of no conditions or circumstances that could interfere
with such compliance in the future; (2) the Borrower has obtained all
environmental permits and approvals required by law for the operation of its
business; and (3) the Borrower has not identified any "recognized environmental
conditions", as that term is defined by the American Society for Testing and
Materials in its standards for environmental due diligence, which could subject
the Borrower to enforcement action if brought to the attention of appropriate
governmental authorities.
DC1425E1
EXHIBIT C
March 28, 2002
To: Xxxx Xxxxxxxxx and Xxxxxx Xxxxxxxx (the "Facility Guarantors")
Re: Patient Infosystems, Inc., a Delaware corporation (the "Company") Revolving
Credit Facility
Gentlemen:
Xxxxx Fargo Iowa, National Association (the "Bank") has extended a $2,500,000.00
revolving credit facility (the "Revolving Facility") to Patient Infosystems,
Inc., a Delaware corporation (the "Company") subject to the conditions set forth
in the Second Restated and Amended Credit Agreement between the Bank and the
Company, dated March 28, 2002.
At the Company's request, the Facility Guarantors have agreed to provide in
favor of the Bank various guaranty agreements, letters of credit and other
documents (collectively the "Credit Support Arrangements"), in the following
amounts for each respective Facility Guarantor, to secure the performance by the
Company of its obligation to the Bank under the Revolving Facility:
Revolving Facility
Xxxx Xxxxxxxxx Personal Guaranty $ 580,000
Xxxx Xxxxxxxxx Letter of Credit $ 750,000
Xxxxxx Xxxxxxxx Letter of Credit $ 1,250,000
The Facility Guarantors hereby consent to the Second Amended and Restated Credit
Agreement and the Revolving Facility.
If the Bank proceeds against the Credit Support Arrangements and receives
payment in full of the Revolving Facility, the Bank immediately shall assign all
of its rights and remedies under the Revolving Facility and related documents,
including the Bank's collateral documents to the Facility Guarantors. Any such
assignment shall be made by the Bank without recourse and without any
representations or warranties of any kind, except that the Bank owns the
Revolving Facility and related collateral documents and has the right to assign
the same.
The liability of the Facility Guarantors under the Credit Support Arrangements
shall not be reduced or impaired by any of the following acts or events (which
the Bank is expressly authorized to do, omit or suffer from time to time,
without notice to or the consent of or approval of the Facility Guarantors): (a)
any acceptance of collateral security, guarantors, accommodation parties or
sureties for the Revolving Facility; (b) any one or more extensions or renewals
of the Revolving Facility (whether or not for a period longer than the original
period) or any modification of the interest rate, maturity or other contractual
terms applicable to all or part of the Revolving Facility; (c) any waiver or
indulgence granted to the Company, any delay or lack of diligence in the
enforcement of the Revolving Facility, or any failure to institute proceedings,
file a claim, give any required notices or otherwise protect the Revolving
Facility; (d) any full or partial release of, settlement with, or agreement not
to xxx, the Company or any other Facility Guarantor or other person liable with
respect to the Revolving Facility; (e) any discharge of any evidence of the
Revolving Facility or the acceptance of any instrument renewing or refinancing
the Revolving Facility; (f) any failure to obtain collateral security (including
rights of setoff) for the Revolving Facility, or to assure its proper or
sufficient creation, perfection, or priority, or to protect, insure, or enforce
any collateral security; or any modification, substitution, discharge,
impairment, or loss of such collateral security; (g) any foreclosure or
enforcement of any collateral security by the Bank or any other creditor of the
Company with a security interest in the collateral security; (h) any assignment
or transfer of the Revolving Facility; (i) any order of application of any
payments or credits upon the Revolving Facility from the Company, a Facility
Guarantor or any other person; and (j) any election by the Bank under Sec
1111(b)(2) of the United States Bankruptcy Code.
The respective agreements of the Bank and the Facility Guarantors stated herein
shall be binding on their respective successors and assigns.
This letter agreement may be executed in one or more identical counterparts,
which, when executed by all parties, shall constitute one and the same document.
This letter agreement and the Credit Support Arrangements shall be construed in
accordance with the laws of Iowa applicable to contracts performed entirely
within the State. Any action to enforce the provisions of this letter agreement
or the Credit Support Arrangements or arising from the actions of any party in
connection therewith, shall be brought in the United States District Court for
the Southern District of Iowa or in the Iowa District Court in Polk County,
Iowa, except such action as may be necessary by the Bank to protect, preserve
and realize its security interest in collateral located in another jurisdiction.
IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD BE READ
CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR
ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY ENFORCED.
YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEMENT.
THIS NOTICE ALSO APPLIES TO ANY OTHER CREDIT AGREEMENTS (EXCEPT CONSUMER LOANS
OR OTHER EXEMPT TRANSACTIONS) NOW IN EFFECT BETWEEN YOU AND THIS LENDER.
Please indicate your acceptance of the terms hereof by signing in the
appropriate space below and returning to the undersigned the enclosed duplicate
original of this letter agreement.
Very truly yours,
XXXXX FARGO BANK IOWA, N.ATIONAL ASSOCIATION
By: /s/ Xxxxxx X. Xxxxxxxx
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Xxxxxxx X. Xxxxxxxx, Vice President
THE FACILITY GUARANTORS:
, 2002
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Xxxx Xxxxxxxxx
, 2002
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Xxxxxx Xxxxxxxx
