EXHIBIT 10.1
UNION BANK OF CALIFORNIA
BUSINESS LOAN AGREEMENT
This Business Loan Agreement (this "Agreement") is entered into as of the date
set forth below between Union Bank of California. N.A. ("Bank") and the
undersigned ("Borrower") with respect to each and every extension of credit
(whether one or more, collectively referred to as the "Loan") from Bank to
Borrower. In consideration of the Loan, Bank and Borrower agree to the
following terms and conditions.
1. THE LOAN
1.1 The Note. The Loan is evidenced by one or more promissory notes or
other evidences of indebtedness, including each amendment, extension,
renewal or replacement thereof, which are incorporated herein by this
reference (whether one or more, collectively referred to as the "Note").
1.2 Revolving Loan Clean-up Period. For any portion of the Loan which is a
revolving loan, at least N/A consecutive days during each 12 month
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period, the principal amount outstanding under such revolving loan must
be zero.
1.3 Term Loan Availability Period. For any portion of the Loan which is a
term loan, loan proceeds shall be available for disbursement from N/A,
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through _____, ____, only.
1.4 Fee. Borrower shall pay to Bank a fee of $N/A.
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1.5 Collateral. The payment and performance of all obligations of Borrower
under the Loan Documents are and shall be during the term of the Loan
secured by a perfected security interest in such real or personal
property collateral as is required by Bank and each security interest
shall rank in first priority unless otherwise specified in writing by
Bank.
1.6 Guaranty. The payment and performance of all obligations of Borrower
under the Loan Documents are and shall be during the term of the Loan
guaranteed by N/A.
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1.7 Subordination. Certain other obligations of Borrower are and shall be
during the term of the Loan subordinated to the repayment of the Loan
and all other obligations of Borrower to Bank, pursuant to one or more
subordination agreement(s) in favor of Bank executed and delivered by
N/A.
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2. CONDITIONS TO AVAILABILITY OF THE LOAN. Before Bank is obligated to disburse
all or any portion of the Loan, Bank must have received (a) the Note and
every other document required by Bank in connection with the Loan, each of
which must be in form and substance satisfactory to Bank (together with this
Agreement, referred to as the "Loan Documents"), (b) confirmation of the
perfection of its security interest in any collateral for the Loan, and
(c) payment of any fee required in connection with the Loan.
3. REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants (and each
request for a disbursement of the proceeds of the Loan shall be deemed a
representation and warranty made on the date of such request) that:
3.1 Borrower is an individual or Borrower is duly organized and existing
under the laws of the state of its organization and is duly qualified to
conduct business in each jurisdiction in which its business is
conducted;
3.2 The execution, delivery and performance of the Loan Documents executed
by Borrower are within Borrower's power, have been duly authorized, are
legal, valid and binding obligations of Borrower, and are not in
conflict with the terms of any charter, bylaw, or other organization
papers of Borrower or with any law, indenture, agreement or undertaking
to which Borrower is a party or by which Borrower is bound or affected;
3.3 All financial statements and other financial information submitted by
Borrower to Bank are true and correct in all material respects, and
there has been no material adverse change in Borrower's financial
condition since the date of the latest of such financial statements;
3.4 Borrower is properly licensed and in good standing in each state in
which Borrower is doing business, and Borrower has complied with all
laws and regulations affecting Borrower, including without limitation,
each applicable fictitious business name statute;
3.5 There is no event which is, or with notice or lapse of time or both
would be, an Event of Default (as defined in Article 5);
3.6 Borrower is not engaged in the business of extending credit for the
purpose of, and no part of the Loan will be used, directly or
indirectly, for purchasing or carrying margin stock within the meaning
of Federal Reserve Board Reg. U; and
3.7 Borrower is not aware of any fact, occurrence or circumstance which
Borrower has not disclosed to Bank in writing which has, or could
reasonably be expected to have, a material adverse effect on Borrower's
ability to repay the Loan or perform its obligations under the Loan
Documents.
4. COVENANTS. Borrower agrees, so long as the Loan or any commitment to make
any advance under the Loan is outstanding and until full and final payment of
all sums outstanding under any Loan Document, that Borrower will:
4.1 Maintain:
(a) Working Capital of at least $N/A (As used herein, "Working
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Capital" means the excess of current assets over current liabilities.
"Current Assets" means cash, marketable securities, accounts
receivable and inventory);
(b) A ratio of current assets to current liabilities of at least
N/A:1.00;
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(c) A quick ratio of cash, accounts receivable and marketable
securities to current liabilities of at least N/A:1.00;
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(d) Tangible Net Worth of at least $ 3,000,000.00 (As used herein,
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"Tangible Net Worth" means net worth increased by indebtedness of
Borrower subordinated to Bank and decreased by patents, licenses,
trademarks, trade names, goodwill and other similar intangible assets,
organizational expenses, and monies due from affiliates (including
officers, shareholders and directors));
(e) A ratio of total liabilities to Tangible Net Worth of not greater
than N/A:1.00 (As used herein "Tangible Net Worth" means net worth
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increased by indebtedness of Borrower subordinated to Bank and
decreased by patents, licenses, trademarks, trade names, goodwill and
other similar intangible assets, organizational expenses, and monies
due from affiliates (including officers, shareholders and directors));
(f) A profit after taxes of not less than $ N/A, to be measured as of
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the end of each fiscal ____ of Borrower for the ______ period
immediately preceding the date of measurement;
(g) A ratio of Cash Flow to Debt Service of at least N/A:1:00.
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Compliance with this subsection to be measured as of the end of each
fiscal ______ of Borrower. (As used herein, "Cash Flow" means net
profit after taxes, to which depreciation, amortization and other non-
cash expenses are added for the _______ month period immediately
preceding the date of calculation, and "Debt Service" means that
portion of long-term liabilities and capital leases coming due within
______ months after the date of calculation); and
(h) N/A
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All accounting terms used in this Agreement shall have the definitions given
them by generally accepted accounting principles, unless otherwise defined
herein.
4.2 Give written notice to Bank within 15 days of the following:
(a) Any litigation or arbitration proceeding affecting Borrower where
the amount in controversy is $ N/A or more;
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(b) Any material dispute which may exist between Borrower and any
government regulatory body or law enforcement body;
(c) Any Event of Default or any event which, upon notice, or lapse of
time, or both, would become an Event of Default;
(d) Any other matter which has resulted or is likely to result
in a material adverse change in Borrower's financial condition or
operation; and
(e) Any change in Borrower's name or the location of Borrower's
principal place of business, or the location of any collateral for
the Loan, or the establishment of any new place of business or the
discontinuance of any existing place of business.
4.3 Furnish to Bank an income statement, balance sheet, and statement of
retained earnings, with supportive schedules ("Financial Statement"),
and any other financial information requested by Bank, prepared in
accordance with generally accepted accounting principles and in a form
satisfactory to Bank as follows:
(a) Within sixty (60) days after the close of each fiscal three-
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month period, Borrower's Financial Statement as the close of such
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period;
(b) Within one hundred twenty (120) days after the close of each
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fiscal year, a copy of Borrower's annual Financial Statement
prepared by an independent certified public accountant on a(n)
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audited basis. Any independent certified public accountant who
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prepares Borrower's Financial Statement shall be selected by
Borrower and reasonably satisfactory to Bank;
(c) Annually, upon request, a copy of each guarantor's annual
Financial Statement;
(d) If a Borrowing Base Addendum is made part of this Agreement,
within twenty (20) days after each calendar month-end, in form
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required by Bank, a copy of Borrower's monthly accounts receivable
and accounts payable agings, a report of Borrower's inventory, and
a certificate of compliance with the borrowing base described in
said Borrowing Base Addendum, which certificate shall accurately
report the collateral in form required by Bank; and
(e) Promptly upon request, any other financial information
requested by Bank.
4.4 Furnish to Bank, on Bank's request, a copy of Borrower's and each
guarantor's most recently filed federal income tax return with all
accompanying schedules.
4.5 Pay or reimburse Bank for all costs, expenses and fees incurred by
Bank in preparing and documenting this Agreement and the Loan, and
all amendments and modifications thereof, including but not limited
to all filing and recording fees, costs of appraisals, insurance
and attorney's fees, including the reasonable estimate of the
allocated costs and expenses of in-house legal counsel and staff.
4.6 Maintain and preserve Borrower's existence, present form of
business and all rights, privileges and franchises necessary or
desirable in the normal course of its business, and keep all of
Borrower's properties in good working order and condition.
4.7 Maintain and keep in force insurance with companies acceptable to
Bank and in such amounts and types, including without limitation
fire and public liability insurance, as is usual in the business
carried on by Borrower, or as Bank may reasonably request. Such
insurance policies must be in form and substance satisfactory to
Bank.
4.8 Maintain adequate books, accounts and records and prepare all
financial statements required hereunder in accordance with
generally accepted accounting principles, and in compliance with
the regulations of any governmental regulatory body having
jurisdiction over Borrower or Borrower's business and permit
employees or agents of Bank at any reasonable time to inspect
Borrower's assets and properties, and to examine or audit
Borrower's books, accounts and records and make copies and
memoranda thereof.
4.9 At all times comply with, or cause to be complied with, all laws,
statutes, rules, regulations, orders and directions of any
governmental authority having jurisdiction over Borrower or
Borrower's business, and all material agreements to which Borrower
is a party.
4.10 Except as provided in this Agreement, or in the ordinary course of
its business as currently conducted, not make any loans or
advances, become a guarantor or surety, pledge its credit or
properties in any manner, or extend credit.
4.11 Not purchase the debt or equity of another person or entity except
for savings accounts and certificates of deposit of Bank, direct
U.S. Government obligations and commercial paper
issued by corporations with top ratings of Moody's or Standard &
Poor's, provided that all such permitted investments shall mature
within one year of purchase.
4.12 Not create, assume or suffer to exist any mortgage, encumbrance,
security interest, pledge or lien ("Lien") on Borrower's real or
personal property, whether now owned or hereafter acquired, or upon
the income or profits thereof except the following: (a) Liens in
favor of Bank, (b) Liens for taxes or other items not delinquent or
contested in good faith and (c) other Liens which do not exceed in
the aggregate $N/A at any one time.
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4.13 Not sell or discount any account receivable or evidence of
indebtedness, except to Bank; not borrow any money or become
contingently liable for money borrowed, except pursuant to
agreements made with Bank.
4.14 Neither liquidate, dissolve, enter into any consolidation, merger,
partnership or other combination; nor convey, sell or lease all or
the greater part of its assets or business; nor purchase or lease
all or the greater part of the assets or business of another.
4.15 Not engage in any business activities or operations substantially
different from or unrelated to Borrower's present business
activities and operations.
4.16 Not, in any single fiscal year of Borrower, expend or incur
obligations of more than $N/A for the acquisition of fixed or
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capital assets.
4.17 Not, in any single fiscal year of Borrower, enter into any lease of
real or personal property which would cause Borrower's aggregate
annual obligations under all such real and personal property leases
to exceed $N/A.
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4.18 Borrower will promptly, upon demand by Bank, take such further
action and execute all such additional documents and instruments in
connection with this Agreement as Bank in its reasonable discretion
deems necessary, and promptly supply Bank with such other
information concerning its affairs as Bank may request from time to
time.
5. EVENTS OF DEFAULT. The occurrence of any of the following events ("Events of
Default") shall terminate any obligation on the part of Bank to make or
continue the Loan and automatically, unless otherwise provided under the Loan
Documents, shall make all sums of interest and principal and any other
amounts owing under the Loan immediately due and payable, without notice of
default, presentment or demand for payment, protest or notice of nonpayment
or dishonor, or any other notices or demands:
5.1 Borrower shall default in the due and punctual payment of the principal
of or the interest on the Note or any of the other Loan Documents.
5.2 Any default shall occur under the Note or any of the other Loan
Documents:
5.3 Borrower shall default in the due performance or observance of any
covenant or condition of the Loan Documents;
5.4 Any guaranty or subordination agreement required hereunder shall be
breached or become ineffective, or any guarantor or subordinating
creditor shall die or disavow or attempt to revoke or terminate such
guaranty or subordination agreement; or
5.5 There shall be a change in ownership or control of 10% or more of the
issued and outstanding stock of Borrower or any guarantor, or (if the
Borrower is a partnership) there shall be a change in ownership or
control of any general partner's interest.
6. MISCELLANEOUS PROVISIONS
6.1 The rights, powers and remedies given to Bank hereunder shall be
cumulative and not alternative and shall be in addition to all rights,
powers and remedies given to Bank by law against Borrower or any other
person, including but not limited to Bank's rights of setoff and
banker's lien.
6.2 Any forbearance or failure or delay by Bank in exercising any right,
power or remedy hereunder shall not be deemed a waiver thereof and any
single or partial exercise of any right,
power or remedy shall not preclude the further exercise thereof. No
waiver shall be effective unless it is in writing and signed by an
officer of Bank.
6.3 The benefits of this Agreement shall inure to the successors and assigns
of Bank and the permitted successors and assigns of Borrower, and any
assignment by Borrower without Bank's consent shall be null and void.
6.4 This Agreement and all other agreements and instruments required by Bank
in connection herewith shall be governed by and construed according to
the laws of the State of California.
6.5 Should any one or more provisions of this Agreement be determined to be
illegal or unenforceable, all other provisions nevertheless shall be
effective.
6.6 Except for documents and instruments specifically referenced herein,
this Agreement constitutes the entire agreement between Bank and
Borrower regarding the Loan and all prior communications, verbal or
written, between Borrower and Bank shall be of no further effect or
evidentiary value.
6.7 The section and subsection headings herein are for convenience of
reference only and shall not limit or otherwise affect the meaning
hereof.
6.8 This Agreement may be amended only in writing signed by all parties
hereto.
6.9 Borrower and Bank may execute one or more counterparts to this
Agreement, each of which shall be deemed an original, but taken together
shall be one and the same instrument.
6.10 Any notices or other communications provided for or allowed hereunder
shall be effective only when given by one of the following methods and
addressed to the respective party at its address given with the
signatures at the end of this Agreement and shall be considered to have
been validly given: (a) upon delivery, if delivered personnally; (b)
upon receipt, if mailed, first class postage prepaid, with the United
States Postal Service; (c) on the next business day if sent by overnight
courier service of recognized standing; and (d) upon telephoned
confirmation of receipt, if telecopied.
7. ADDITIONAL PROVISIONS
The following additional provisions, if any, are hereby made a part of this
Agreement:
N/A
THIS AGREEMENT is executed on behalf of the parties as of 5/10 , 1999.
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Union Bank of California, N.A. Tivoli Industries, Inc.
("Bank") ("Borrower")
By: /s/ Xxxxx Xxxxxxxxx By: /s/ Xxxxxxxx X. Xxxxx
Title: Assistant Vice President Title: Chief Executive Officer
Printed Name: Xxxxx X. Xxxxxxxxx Printed Name: Xxxxxxxx X. Xxxxx
Address where notices to Bank Address where notices to Borrower
are to be sent: are to be sent:
00000 Xxxxx xx Xxxxxxxx 0000 X. Xx. Xxxxxxxx Xxxxx
Xxxxxx Xxxxx, XX 00000 Xxxxx Xxx, XX 00000
Attn: Xxxxx Xxxxxxxxx Attn: Xxxxxxxx X. Xxxxx
Fax Number: (000) 000-0000 Fax Number:
Telephone No. (000) 000-0000 Telephone No. (000) 000-0000
BORROWING BASE ADDENDUM
This Borrowing Base Addendum is hereby made a part of and incorporated into the
Business Loan Agreement dated as of ___________, _______ as amended and
supplemented from time to time (the "Agreement") between Union Bank of
California, N.A. and the undersigned ("Borrower").
1.8 Borrowing Base. An amount of the Loan equal to $1,250,000, evidenced by
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the Note dated _________, ______ or any substitutions or replacements
thereof, is a revolving loan subject to a borrowing base ("Borrowing Base
Loan"). Notwithstanding any other provision of the Agreement or any other
Loan Document, Bank shall not be obligated to advance any funds under the
Borrowing Base Loan if the principal amount of such Borrowing Base Loan
including such advance exceeds 80% of Borrower's Eligible Accounts plus
--
50% of Borrower's Eligible Inventory. However, extensions of credit under
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the Borrowing Base Loan which are based on availability under Borrower's
Eligible Inventory shall not at any time exceed $400,000. If at any time
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Borrower's obligations to Bank under the Borrowing Base Loan exceed the sum
so permitted, Borrower shall immediately repay to Bank such excess.
The term "Accounts" means all presently existing and hereafter arising
accounts receivable, contract rights, chattel paper, and all other forms of
obligations owing to Borrower, payable in U.S. Dollars, arising out of the
sale or lease of goods, or the rendition of services by Borrower, whether
or not earned by performance, and any and all credit insurance, guaranties
and other security, as well as all merchandise returned to or reclaimed by
Borrower and Borrower's books and records relating to any of the foregoing.
The term "Eligible Accounts" means those Accounts, net of finance charges,
which have been validly assigned to Bank and strictly comply with all of
Borrower's representations and warranties to Bank, but Eligible Accounts
shall not include the following:
(a) Any Account with respect to which the account debtor is an officer,
shareholder, director, employee or agent of Borrower;
(b) Any Account with respect to which the account debtor is a subsidiary of,
related to, or affiliated or has common officers or directors with
Borrower;
(c) Any Account relating to goods placed on consignment, guaranteed sale or
other terms by reason of which the payment by the account debtor may be
conditional;
(d) Any Account with respect to which the account debtor is not a resident of
the United States;
(e) Any Account with respect to which the account debtor is a federal, state or
local governmental entity or agency;
(f) Any Account with respect to which Borrower is or may become liable to the
account debtor for goods sold or services rendered by the account debtor to
Borrower;
(g) Any Account with respect to which there is asserted a defense,
counterclaim, discount or setoff, whether well-founded or otherwise; except
for those discounts, allowances and returns arising in the ordinary course
of Borrower's business;
(h) Any Account with respect to which the account debtor becomes insolvent,
fails to pay its debts as they mature or goes out of business or which is
owed by an account debtor which has become the subject of a proceeding
under any provision of the United States Bankruptcy Code, as amended, or
under any other bankruptcy or insolvency law, including, but not limited
to, assignments for the benefit of creditors, formal or informal
moratoriums, compositions or extensions with all or substantially all of
its creditors;
(i) Any account owed by any account debtor with respect to which twenty-five
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percent (25%) or more of the aggregate dollar amount is its Accounts is not
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paid within ninety (90) days from the date of invoice;
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(j) Any Account that is not paid by the account debtor within ninety (90) days
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of the date of invoice;
(k) That portion of the Account owed by any single account debtor which exceeds
25% of all of the Accounts;
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(l) Any Account which Bank deems not to be an Eligible Account; and
(m)
The term "Inventory" means all present and future inventory of Borrower held by
Borrower for sale or lease or to be furnished under a contract of service and
all of Borrower's present and future raw materials, work in process used or
consumed in Borrower's business.
The term "Eligible Inventory" means that portion of Borrower's Inventory of raw
materials and finished goods consisting of Borrower's main line(s) of business
products, which is (a) owned by Borrower, free and clear of all liens and
encumbrances except those in favor of Bank, (b) held for sale or lease by
Borrower and normally and currently saleable in the ordinary course of
Borrower's business, (c) of good and merchantable quality, free from defects (d)
located only at locations of which Bank is notified in writing, and (e) at all
times subject to a perfected first priority security interest in favor of Bank.
"Eligible Inventory" does not include any of the following: work in process,
spare parts, returned items, damaged, defective or recalled items, items unfit
for further processing, obsolete or unmerchantable items, items used as
salesperson's samples or demonstrators, inventory held in stock more than twelve
(12) months, or inventory which Bank otherwise deems not to be Eligible
Inventory.
Capitalized terms used herein which are not otherwise defined shall have the
meanings given to them in the Agreement.
THIS AGREEMENT is executed on behalf of the parties as of 5/10, 1999.
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Union Bank of California, N.A. Tivoli Industries, Inc.
("Bank") ("Borrower")
By: /s/ XXXXX XXXXXXXXX By: /s/ XXXXXXXX X. XXXXX
Title: Assistant Vice President Title: Chief Executive Officer
Printed Name: Xxxxx X. Xxxxxxxxx Printed Name: Xxxxxxxx X. Xxxxx
UNION BANK OF CALIFORNIA
COMMERCIAL PROMISSORY NOTE
Borrower Name:
TIVOLI INDUSTRIES, INC.
Borrower Address: Office: Loan Number:
0000 X. XX. XXXXXXXX XXXXX 00000 9209823046 0000-00-0000
XXXXX XXX, XX 00000
Maturity Date: Amount:
MARCH 1, 2001 $1,250,000.00
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DATE:
April 13, 1999 $1,250,000.00
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FOR VALUE RECEIVED, on MARCH 1, 2001 the undersigned ("Debtor") promises
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to pay to the order of UNION BANK OF CALIFORNIA, N.A. ("Bank"), as indicated
below, the principal sum of ONE MILLION TWO HUNDRED FIFTY THOUSAND AND NO/100
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Dollars ($1,250,000.00), or so much thereof as is disbursed, together with
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interest on the balance of such principal sum from time to time outstanding, at
a per annum rate equal to the Reference Rate plus ONE AND NO/100 percent
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(1.000%), such per annum rate to change as and when the Reference Rate shall
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change.
As used herein, the term "Reference Rate" shall mean the rate announced by Bank
from time to time at its corporate headquarters as its "Reference Rate." The
Reference Rate is an index rate determined by Bank from time to time as a means
of pricing certain extensions of credit and is neither directly tied to any
external rate of interest or index nor necessarily the lowest rate of interest
charged by Bank at any given time. All computations of interest under this note
shall be made on the basis of a year of 360 days, for actual days elapsed.
1. Interest Payments. Debtor shall pay interest on the 1ST day of each
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MONTH commencing MAY 1, 1999. Should interest not be so paid, it shall
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become a part of the principal and thereafter bear interest as herein
provided.
At any time prior to the maturity of this note, the maker(s) may borrow,
repay and reborrow hereon so long as the total outstanding at any one time
does not exceed the principal amount of this note.
Debtor shall pay all amounts due under this note in lawful money of the
United States at SOUTH ORANGE COUNTY - BBC Office, or such other office as
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may be designated by Bank, from time to time.
2. Late payments. If any installment payment required by the terms of this note
shall remain unpaid ten days after due, at the option of Bank, Debtor shall
pay a fee of $100 to Bank.
3. Interest Rate Following Default. In the event of default, at the option of
Bank, and, to the extend permitted by law, interest shall be payable on the
outstanding principal under this note at a par annum rate equal to five
percent (5%) in excess of the interest rate specified in the initial
paragraph of this note, calculated from the date of default until all amounts
payable under this note are paid in full.
4. Default and Acceleration of Time For Payment. Default shall include , but
not be limited to, any of the following: (a) the failure of Debtor to make
any payment required under this note when due; (b) any breach,
misrepresentation or other default by Debtor, any guarantor, co-maker,
endorser, or any person or other entity other than Debtor providing security
for this note (hereinafter individually and collectively referred to as the
"Obligor") under any security agreement, guaranty or other agreement
between Bank and any Obligor; (c) the insolvency of any Obligor or the
failure of any Obligor generally to pay such Obligor's debts as such debts
become due; (d) the commencement as to any Obligor of any voluntary or
involuntary proceeding under any laws relating to bankruptcy, insolvency,
reorganization, arrangement, debt adjustment or debtor relief; (e) the
assignment by any Obligor's creditors; (f) the appointment, or commencement
of any proceedings for the appointment, of a receiver, trustee, custodian or
similar official for all or substantially all of any Obligor's property; (g)
the commencement of any proceeding for the dissolution or liquidation of any
Obligor; (h) the termination of existence or death of any Obligor; (i) the
revocation of any guaranty or subordination agreement given in connection
with this note (j) the failure of any Obligor to comply with any order,
judgment, injunction, decree, writ or demand of any court or other public
authority; (k) the filing or recording against any Obligor, or the property
of any authority; (k) the filing or recording against any Obligor, or the
property of any Obligor, of any notice of levy, notice to withhold, or other
legal process for taxes, other than property taxes (l) the default by any
Obligor personally liable for amounts owed hereunder on any obligation
concerning the borrowing of money; (m) the issuance against any Obligor, or
the property of any Obligor,of any writ of attachment, execution, or other
judicial lien; or (n) the deterioration of the financial condition of any
Obligor which results in Bank deeming itself, in good faith, insecure.
Upon the occurrence of any such default, Bank, in its discretion, may cease
to advance funds hereunder and may declare all obligations under this note
immediately due and payable; however, upon the occurrence of an event of
default under d, e, f, or g, all principal and interest shall automatically
become immediately due and payable.
5. Additional Agreements of Debtor. If any amounts owing under this note are
not paid when due, Debtor promises to pay all costs and expenses, including
reasonable attorney's fees, incurred by Bank in the collection of enforcement
of this note. Debtor and any endorsers of this note, for the maximum period
of time and the full extent permitted by law, (a) waive diligence,
presentment, demand, notice of nonpayment, protest, notice of protest, and
notice of every kind; (b) waive the right to assert the defense of any
statute of limitations to any debt or obligation hereunder; and (c) consent
to renewals and extensions of time for the payment of any amounts due under
this note. If this note is signed by more than one party, the term "Debtor"
includes each of the undersigned and any successors in interest thereof; all
of whose liability shall be joint and several. Any married person who signs
this note agrees that recourse may be had against the separate property of
that person for any obligations hereunder. The receipt of any check or other
item of payment by Bank, at its option, shall not be considered a payment on
account until such a check or other item of payment is honored when presented
for payment at the drawee bank. Bank may delay the credit of such payment
based upon Bank's schedule of funds availability, and interest under this
note shall accrue until the funds are deemed collected. In any action
brought under or arising out of this note, Debtor and any endorser of this
note, including their successors and assigns, hereby consents to the
jurisdiction of any competent court within the State of California, as
provided in any alternative dispute resolution agreement executed between
Debtor and Bank, and consents to service of process by any means authorized
by California law. The term "Bank" includes, without limitation, any holder
of this note. This note shall be construed in accordance with and governed
by the laws of the State of California. This note hereby incorporates any
alternative dispute resolution agreement previously, concurrently or
hereafter executed between Debtor and Bank.
TIVOLI INDUSTRIES, INC.
By: /s/ XXXXXXXX X. XXXXX Title: Chief Executive Officer
UNION BANK OF CALIFORNIA
COMMERCIAL PROMISSORY NOTE
Borrower Name:
TIVOLI INDUSTRIES, INC.
Borrower Address: Office: Loan Number:
0000 X. XX. XXXXXXXX XXXXX 00000 9209823046 0000-00-000
XXXXX XXX, XX 00000
Maturity Date: Amount:
MARCH 1, 2004 $250,000.00
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DATE:
APRIL 13, 1999 $250,000.00
FOR VALUE RECEIVED, the undersigned ("Debtor") promises to pay to the order of
UNION BANK OF CALIFORNIA, N.A. ("Bank"), as indicated below, the principal sum
of TWO HUNDRED FIFTY THOUSAND AND NO/100 Dollars ($250,000.00), or so
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much thereof as is disbursed, together with interest on the balance of such
principal sum from time to time outstanding, at a per annum rate equal to the
Reference Rate plus ONE AND NO/100 percent (1.000%) such per annum rate
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to change as and when the Reference Rate shall change.
As used herein, the term "Reference Rate" shall mean the rate announced by Bank
from time to time at its corporate headquarters as its "Reference Rate." The
Reference Rate is an index rate determined by Bank from time to time as a means
of pricing certain extensions of credit and is neither directly tied to any
external rate of interest or index nor necessarily the lowest rate of interest
charged by Bank at any given time. All computations of interest under this note
shall be made on the basis of a year of 360 days, for actual days elapsed.
AT ANY TIME PRIOR TO MARCH 1, 2000, THE DEBTORS(S) MAY BORROW UNDER THIS NOTE;
PROVIDED THAT AT NO TIME MAY DEBTOR REBORROW AND AMOUNT REPAID TO BANK.
1. PAYMENTS. Interest Payments. Debtor shall pay interest on the
1ST day of each MONTH commencing MAY 1, 1999.
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Principal Payments. PRINCIPAL PAYMENTS SHALL BE PAYABLE IN FORTY EIGHT (48)
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EQUAL CONSECUTIVE MONTHLY INSTALLMENTS, EACH INSTALLMENT IN AN AMOUNT SUFFICIENT
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TO FULLY AMORTIZE THE PRINCIPAL BALANCE BY THE FINAL MATURITY DATE, BEGINNING
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APRIL 1, 2000, AND CONTINUING ON THE FIRST (1ST) DAY OF EACH CONSECUTIVE MONTH.
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On MARCH 1,2004, all principal and interest then unpaid shall be due and
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payable.
Debtor shall pay all amounts due under this note in lawful money of the United
States at SOUTH ORANGE COUNTY - BBC Office, or such other office as may be
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designated by Bank, from time to time.
2. Late payments. If any installment payment required by the terms of this note
shall remain unpaid ten days after due, at the option of Bank, Debtor shall
pay a fee of $100 to Bank.
3. Interest Rate Following Default. In the event of default, at the option of
Bank, and, to the extend permitted by law, interest shall be payable on the
outstanding principal under this note at a par annum rate equal to five
percent (5%) in excess of the interest rate specified in the initial
paragraph of this note, calculated from the date of default until all amounts
payable under this note are paid in full.
4. Default and Acceleration of Time For Payment. Default shall include , but
not be limited to, any of the following: (a) the failure of Debtor to make
any payment required under this note when due; (b) any breach,
misrepresentation or other default by Debtor, any guarantor, co-maker,
endorser, or any person or other entity other than Debtor providing security
for this note (hereinafter individually and collectively referred to as the
"Obligor") under any security agreement, guaranty or other agreement between
Bank and any Obligor; (c) the insolvency of any Obligor or the failure of any
Obligor generally to pay such Obligor's debts as such debts become due; (d)
the commencement as to any Obligor of any voluntary or involuntary proceeding
under any laws relating to bankruptcy, insolvency, reorganization,
arrangement, debt adjustment or debtor relief; (e) the assignment by any
Obligor's creditors; (f) the appointment, or commencement of any proceedings
for the appointment, of a receiver, trustee, custodian or similar official
for all or substantially all of any Obligor's property; (g) the commencement
of any proceeding for the dissolution or liquidation of any Obligor; (h) the
termination of existence or death of any Obligor; (i) the revocation of any
guaranty or subordination agreement given in connection with this note (j)
the failure of any Obligor to comply with any order, judgment, injunction,
decree, writ or demand of any court or other public authority; (k) the filing
or recording against any Obligor, or the property of any authority; (k) the
filing or recording against any Obligor, or the property of any Obligor, of
any notice of levy, notice to withhold, or other legal process for taxes,
other than property taxes (l) the default by any Obligor personally liable
for amounts owed hereunder on any obligation concerning the borrowing of
money; (m) the issuance against any Obligor, or the property of any
Obligor,of any writ of attachment, execution, or other judicial lien; or (n)
the deterioration of the financial condition of any Obligor which results in
Bank deeming itself, in good faith, insecure.
Upon the occurrence of any such default, Bank, in its discretion, may cease
to advance funds hereunder and may declare all obligations under this note
immediately due and payable; however, upon the occurrence of an event of
default under d, e, f, or g, all principal and interest shall automatically
become immediately due and payable.
5. Additional Agreements of Debtor. If any amounts owing under this note are
not paid when due, Debtor promises to pay all costs and expenses, including
reasonable attorney's fees, incurred by Bank in the collection of enforcement
of this note. Debtor and any endorsers of this note, for the maximum period
of time and the full extent permitted by law, (a) waive diligence,
presentment, demand, notice of nonpayment, protest, notice of protest, and
notice of every kind; (b) waive the right to assert the defense of any
statute of limitations to any debt or obligation hereunder; and (c) consent
to renewals and extensions of time for the payment of any amounts due under
this note. If this note is signed by more than one party, the term "Debtor"
includes each of the undersigned and any successors in interest thereof; all
of whose liability shall be joint and several. Any married person who signs
this note agrees that recourse may be had against the separate property of
that person for any obligations hereunder. The receipt of any check or other
item of payment by Bank, at its option, shall not be considered a payment on
account until such a check or other item of payment is honored when presented
for payment at the drawee bank. Bank may delay the credit of such payment
based upon Bank's schedule of funds availability, and interest under this
note shall accrue until the funds are deemed collected. In any action
brought under or arising out of this note, Debtor and any endorser of this
note, including their successors and assigns, hereby consents to the
jurisdiction of any competent court within the State of California, as
provided in any alternative dispute resolution agreement executed between
Debtor and Bank, and consents to service of process by any means authorized
by California law. The term "Bank" includes, without limitation, any holder
of this note. This note shall be construed in accordance with and governed
by the laws of the State of California. This note hereby incorporates any
alternative dispute resolution agreement previously, concurrently or
hereafter executed between Debtor and Bank.
TIVOLI INDUSTRIES, INC.
By: /s/ XXXXXXXX X. XXXXX Title: Chief Executive Officer
