LOAN AGREEMENT
This Loan Agreement (this "Agreement") executed to be effective as of the 16th
day of August 2001 will serve to set forth the terms of the transactions by and
between Stockton Feed and Milling, Inc. and Ranchers Feed Yards, Inc.
(hereinafter collectively referred to as "Borrower") and Xxxxx Xxxxxxx, Xx.
("Lender").
1. Purpose. The purpose of the execution of the Loan Documents (hereinafter
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defined) is to evidence the agreement relating to the indebtedness between the
parties hereto concerning the payment and repayment of certain amounts owed by
Borrower to Lender as the result of actual loans from Lender to Borrower and the
settlement of claims. The parties will execute a separate agreement with
respect to the particulars of the settlement of claims.
2. Promissory Note. The loan from Lender to Borrower (the "Loan") shall be
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evidenced by a promissory note (the "Note") of even date herewith, in the
principal amount of $1,722,000.12 executed by Borrower and payable to the order
of Holland. Interest on the Note shall accrue at the rate set forth therein.
The principal of and interest on the Note shall be due and payable in accordance
with the terms and conditions set forth in the Note and this Agreement.
3. Collateral and Credit. As collateral and security for the indebtedness
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evidenced by the Note, Borrower has executed and delivered to Lender a Deed of
Trust/Security Agreement/Financing Statement (herein so called) dated of even
date herewith to the trustee named therein for the benefit of Lender. In
addition, the Stock Related Property received or to be received by Lender shall
be used as a credit against the Note and for other purposes as described in the
Note and shall be dealt with by Lender as provided in the Note and the Loan
Documents. The Note, this Agreement and the Deed of Trust/Security
Agreement/Financing Statement are collectively referred to as the "Loan
Documents."
4. Events of Default. Each of the following shall constitute an "Event of
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Default" under the Loan Documents:
(a) The failure, refusal or neglect of Borrower to pay when due any
part of the principal of, or interest on, the Note and failure to cure within
ten (10) days after written notice from Lender; and
(b) The failure of Borrower to timely and properly observe, keep or
perform any other covenant, agreement, warranty or condition required herein or
in any of the other Loan Documents and the failure of Borrower to cure such
default within thirty (30) days after written notice from Lender specifying such
default, provided that if such default or violation is susceptible of being
remedied, but such remedy cannot reasonably be accomplished within the initial
thirty (30) day cure period, no Event of Default shall be deemed to have
occurred so long as Borrower is diligently pursuing such remedy.
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5. Remedies. Upon the occurrence of any one or more of the foregoing Events
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of Default, and upon the expiration of all notice and cure periods, the entire
unpaid balance of principal of the Note, together with all accrued but unpaid
interest thereon, and all other indebtedness owing to Lender by Borrower at such
time shall at the option of Lender, become immediately due and payable upon
notice and demand. All rights and remedies of Lender set forth in this
Agreement and in any of the other Loan Documents may also be exercised by
Lender, at its option and in its sole discretion, upon the occurrence of an
Event of Default.
6. Benefits. This Agreement shall be binding upon and inure to the benefit
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of Lender and Borrower, and their respective successors and assigns, provided,
however, that Lender may not, without the prior written consent of Borrower
assign any rights, powers, duties or obligations under this Agreement or any of
the other Loan Documents.
7. Notices. All notices, requests, demands or other communications required
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or permitted to be given pursuant to this Agreement or the other Loan Documents
shall be in writing and given by (i) personal delivery, (ii) expedited delivery
service with proof of delivery, or (iii) United States mail, postage prepaid,
registered or certified mail, return receipt requested, sent to the intended
addressee at the address set forth below and shall be deemed to have been
received either, in the case of personal delivery, as of the time of personal
delivery, in the case of expedited delivery service, as of the date of first
attempted delivery at the address and in the manner provided herein, or in the
case of mail, upon deposit in a depository receptacle under the care and custody
of the United States Postal Service. Either party shall have the right to
change its address for notice hereunder to any other location within the United
States by notice to the other party of such new address at least thirty (30)
days prior to the effective date of such new address.
Borrower's Notice Address: c/o Loch Xxxxxx, Inc.
0000 Xxxxx Xxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Lender's Notice Address: 00000 XX 000
Xxxxxx, Xxxxx 00000
8. Construction. This Agreement and the other Loan Documents have been
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executed and delivered in Xxxxxx County, Texas, shall be governed by and
construed in accordance with the laws of the State of Texas, and shall be
performable by the parties hereto and venue for enforcement and construction of
the terms of this Agreement shall lie in Xxxxxx County, Texas.
9. Invalid Provisions. If any provision of this Agreement or any of the
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other Loan Documents is held to be illegal, invalid or unenforceable under
present or future laws, such provision shall be fully severable and the
remaining provisions of this Agreement or any of the other Loan Documents shall
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remain in full force and effect and shall not be affected by the illegal,
invalid or unenforceable provision or by its severance.
10. Conflicts. In the event any term or provision hereof is inconsistent
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with or conflicts with any provision of the other Loan Documents, the terms and
provisions contained in this Agreement shall be controlling.
11. Counterparts. This Agreement may be separately executed in any number
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of counterparts, each of which shall be an original, but all of which, taken
together, shall be deemed to constitute one and the same instrument.
12. Limitation of Liability. The liability of Borrower for the payment of
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the Note and for the performance and observance of the covenants,
representations and warranties of Borrower contained in the Note and in this
Agreement is limited in the manner described in the Note, reference to which is
hereby made for all purposes.
13. Obligation to Look for Buyer. Lender agrees that it will diligently
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pursue finding a buyer for the feed yard, feed mill and store owned by Borrower.
If a bona fide offer is received for a price and on terms mutually agreeable to
Borrower and Lender, both parties agree that they will proceed with a sale and
the proceeds shall be disbursed as set forth in the Note; provided, however,
upon such agreement to sell the Property, Lender shall sell the Stock Related
Property, paying the proceeds to Loch.
14. Preparation. THE LOAN DOCUMENTS WERE PREPARED BY COUNSEL FOR BORROWER.
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ACCORDINGLY, LENDER IS ADVISED TO CONSULT WITH HIS OWN ATTORNEY TO ENSURE HIS
RIGHTS ARE PROTECTED. LENDER ACKNOWLEDGES THAT BORROWER'S COUNSEL HAS NOT
RENDERED, AND CANNOT RENDER, TO LENDER ANY LEGAL ADVICE REGARDING THE MATTERS
SET FORTH IN THE LOAN DOCUMENTS.
NOTICE TO COMPLY WITH STATE LAW
For the purpose of this Notice, the term "WRITTEN AGREEMETN" shall include the
document set forth above, together with each and every other document relating
to and/or securing the same loan transaction, regardless of the date of
execution.
THIS WRITTEN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICED BY EVIDENCE OR PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
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In witness hereof, the parties have executed this Agreement to be effective as
of the date first written above.
BORROWER
STOCKTON FEED AND MILLING, INC.
By:______________________________________
Name:____________________________________
Title:___________________________________
RANCHERS FEED YARDS, INC.
By:______________________________________
Name:____________________________________
Title:___________________________________
LENDER
_________________________________________
Xxxxx Xxxxxxx, Xx.
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