Attached files
file | filename |
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10-Q - FORM 10-Q - EACO CORP | a59269e10vq.htm |
EX-10.2 - EX-10.2 - EACO CORP | a59269exv10w2.htm |
EX-31.1 - EX-31.1 - EACO CORP | a59269exv31w1.htm |
EX-32.1 - EX-32.1 - EACO CORP | a59269exv32w1.htm |
Exhibit 10.1 |
DISBURSEMENT REQUEST AND AUTHORIZATION
Principal | Loan Date | Maturity | Loan No | Call / Coll | Account | Officer | Initials | |||||||
$1,000,000.00 | 03-10-2011 | 03-01-2013 | 7100839 | CLS 07 / 240 | 600714 | 765 |
References in the boxes above are for Lenders use only and do not limit the applicability of this document to any particular loan or item.
Any item above containing *** has been omitted due to text length limitations.
Any item above containing *** has been omitted due to text length limitations.
Borrower:
|
BISCO INDUSTRIES, INC. | Lender: | COMMUNITY BANK | |||
1500 N. LAKEVIEW AVE. | ANAHEIM BRANCH | |||||
ANAHEIM, CA 92807 | 1750 S. STATE COLLEGE BLVD. | |||||
ANAHEIM, CA 92806 | ||||||
(800) 788-9999 |
LOAN TYPE. This is a Variable Rate Nondisclosable Loan to a Corporation for $1,000,000.00 due on
March 1, 2013.
PRIMARY PURPOSE OF LOAN. The primary purpose of this loan is for:
o Personal, Family, or Household Purposes or Personal Investment.
þ Business (Including Real Estate Investment).
SPECIFIC PURPOSE. The specific purpose of this loan is: WORKING CAPITAL.
DISBURSEMENT INSTRUCTIONS. Borrower understands that no loan proceeds will be disbursed until all
of Lenders conditions for making the loan have been satisfied. Please disburse the loan proceeds
of $1,000,000.00 as follows:
Other Disbursements: |
$ | 1,000,000.00 | ||
$1,000,000.00 Principal paydown on Loan No. 155354101 |
||||
Note Principal: |
$ | 1,000,000.00 |
AUTOMATIC PAYMENTS. Borrower hereby authorizes Lender automatically to deduct from Borrowers
Demand Deposit - Checking account, numbered 704000652, the amount of any loan payment. If the funds
in the account are insufficient to cover any payment, Lender shall not be obligated to advance
funds to cover the payment. At any time and for any reason, Borrower or Lender may voluntarily
terminate Automatic Payments.
FINANCIAL CONDITION. BY SIGNING THIS AUTHORIZATION, BORROWER REPRESENTS AND WARRANTS TO LENDER THAT
THE INFORMATION PROVIDED ABOVE IS TRUE AND CORRECT AND THAT THERE HAS BEEN NO MATERIAL ADVERSE
CHANGE IN BORROWERS FINANCIAL CONDITION AS DISCLOSED IN BORROWERS MOST RECENT FINANCIAL STATEMENT
TO LENDER. THIS AUTHORIZATION IS DATED MARCH 10, 2011.
BORROWER:
BISCO
INDUSTRIES, INC.
By: | /s/ GLEN F. CEILEY | |||
GLEN F. CEILEY, Chairman and CEO of BISCO | ||||
INDUSTRIES, INC. | ||||
LASER
PRO Lending, Ver 5,55,00,002 Copr. Harland Financial Solution, Inc.
1997, 2011. All Rights Reserved. CA G:\CFISO\CFI\LPL\120.FC
TR-12974 PR-UCCSEC
PROMISSORY NOTE
Principal
|
Loan Date | Maturity | Loan No | Call / Coll | Account | Officer | Initials | |||||||
$1,000,000.00 | 03-10-2011 | 03-01-2013 | 7100839 | CLS 07 / 240 | 600714 | 765 |
References in the boxes above are for Lenders use only and do not limit the applicability of this
document to any particular loan or item.
Any item above containing *** has been omitted due to text length limitations.
Any item above containing *** has been omitted due to text length limitations.
Borrower:
|
BISCO INDUSTRIES, INC. | Lender: | COMMUNITY BANK | |||
1500 N. LAKEVIEW AVE. | ANAHEIM BRANCH | |||||
ANAHEIM, CA 92807 | 1750 S. STATE COLLEGE BLVD. | |||||
ANAHEIM, CA 92806 | ||||||
(800) 788-9999 |
Principal Amount: $1,000,000.00 | Date of Note: March 10, 2011 |
PROMISE TO PAY. BISCO INDUSTRIES, INC. (Borrower) promises to pay to COMMUNITY BANK (Lender),
or order, in lawful money of the United States of America, the principal amount of One Million &
00/100 Dollars ($1,000,000.00), together with interest on the unpaid principal balance from March
10, 2011, until paid in full.
PAYMENT. Borrower will pay this loan in full immediately upon Lenders demand. If no demand is
made, subject to any payment changes resulting from changes in the Index, Borrower will pay this
loan in 24 payments of $43,083.05 each payment. Borrowers first payment is due April 1, 2011, and
all subsequent payments are due on the same day of each month after that. Borrowers final payment
will be due on March 1, 2013, and will be for all principal and all accrued interest not yet paid.
Payments include principal and interest. Unless otherwise agreed or required by applicable law,
payments will be applied to any accrued unpaid interest; then to principal; then to late charges;
then to any unpaid collection costs. Notwithstanding anything to the contrary contained in the
immediately preceding sentence, all payments will be applied as invoiced, so any payment received
prior to the due date will result in an invoice the succeeding month that is calculated to include
a partial interest credit. Conversely, if a payment is received after the due date, the succeeding
months invoice will reflect a higher accrued interest amount than would otherwise be due if the
payment had been made and applied on the due date. Borrower will pay Lender at Lenders address
shown above or at such other place as Lender may designate in writing.
VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from time to time based
on changes in an index which is the rate from time to time established by Lender as its Reference
Rate and used to determine the actual interest rates charged on commercial loans, with the
understanding that such Reference Rate is only one of the base rates that may be used by Lender to
determine the actual interest rate charged on a commercial loan and may not be the lowest of the
base rates so used (the Index). Lender will tell Borrower the current Index rate upon Borrowers
request. The interest rate change will not occur more often than each day. Borrower understands
that Lender may make loans based on other rates as well. The Index currently is 3.250% per
annum. Interest on the unpaid principal balance of this Note will be calculated as described in the
INTEREST CALCULATION METHOD paragraph using a rate equal to the Index, resulting in an initial
rate of 3.250%. NOTICE: Under no circumstances will the interest rate on this Note be more than the
maximum rate allowed by applicable law. Whenever increases occur in the interest rate, Lender, at
its option, may do one or more of the following: (A) increase Borrowers payments to ensure
Borrowers loan will pay off by its original final maturity date, (B) increase Borrowers payments
to cover accruing interest, (C) increase the number of Borrowers payments, and (D) continue
Borrowers payments at the same amount and increase Borrowers final payment.
INTEREST CALCULATION METHOD. Interest on this Note is computed on a 365/360 basis; that is, by
applying the ratio of the interest rate over a year of 360 days, multiplied by the outstanding
principal balance, multiplied by the actual number of days the principal balance is outstanding.
All interest payable under this Note is computed using this method.
PREPAYMENT; MINIMUM INTEREST CHARGE. In any event, even upon full prepayment of this Note, Borrower
understands that Lender is entitled to a minimum interest charge of $500,00. Other than Borrowers
obligation to pay any minimum interest charge, Borrower may pay without penalty all or a portion of
the amount owed earlier than it is due. Early payments will not, unless agreed to by Lender in
writing, relieve Borrower of Borrowers obligation to continue to make payments under the payment
schedule. Rather, early payments will reduce the principal balance due and may result in Borrowers
making fewer payments. Borrower agrees not to send Lender payments marked paid in full, without
recourse, or similar language. If Borrower sends such a payment, Lender may accept it without
losing any of Lenders rights under this Note, and Borrower will remain obligated to pay any
further amount owed to Lender. All written communications concerning disputed amounts, including
any check or other payment instrument that indicates that the payment constitutes payment in full
of the amount owed or that is tendered with other conditions or limitations or as full satisfaction
of a disputed amount must be mailed or delivered to: COMMUNITY BANK, Loan Support Group, Post
Office Box 54477 Los Angeles, CA 90054.
LATE CHARGE. If a payment is 10 days or more late, Borrower will be charged 5.000% of the unpaid
portion of the regularly scheduled payment or $25.00, whichever is greater.
INTEREST AFTER DEFAULT. Upon default, the interest rate on this Note shall, if permitted under
applicable law, immediately increase by adding an additional 5,000 percentage point margin
(Default Rate Margin). The Default Rate Margin shall also apply to each succeeding interest rate
change that would have applied had there been no default.
DEFAULT. Each of the following shall constitute an event of default (Event of Default) under this
Note:
Payment Default. Borrower fails to make any payment when due under this Note. | |||
Other Defaults. Borrower fails to comply with or to perform any other term, obligation, covenant or condition contained in this Note or in any of the related documents or to comply with or to perform any term, obligation, covenant or condition contained in any other agreement between Lender and Borrower. | |||
Default in Favor of Third Parties. Borrower or any Grantor defaults under any loan, extension of credit, security agreement, purchase or sales agreement, or any other agreement, in favor of any other creditor or person that may materially affect any of Borrowers property or Borrowers ability to repay this Note or perform Borrowers obligations under this Note or any of the related documents. | |||
False Statements. Any warranty, representation or statement made or furnished to Lender by Borrower or on Borrowers behalf under this Note or the related documents is false or misleading in any material respect, either now or at the time made or furnished or becomes false or misleading at any time thereafter. |
PROMISSORY NOTE | ||||
Loan No: 7100839 | (Continued) | Page 2 |
Insolvency. The dissolution or termination of Borrowers existence as a going business, the
insolvency of Borrower, the appointment of a receiver for any part of Borrowers property, any
assignment for the benefit of creditors, any type of creditor workout, or the commencement of any
proceeding under any bankruptcy or insolvency laws by or against Borrower.
Creditor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings, whether
by judicial proceeding, self-help, repossession or any other method, by any creditor of Borrower or
by any governmental agency against any collateral securing the loan. This includes a garnishment of
any of Borrowers accounts, including deposit accounts, with Lender. However, this Event of Default
shall not apply if there is a good faith dispute by Borrower as to the validity or reasonableness
of the claim which is the basis of the creditor or forfeiture proceeding and if Borrower gives
Lender written notice of the creditor or forfeiture proceeding and deposits with Lender monies or a
surety bond for the creditor or forfeiture proceeding, in an amount determined by Lender, in its
sole discretion, as being an adequate reserve or bond for the dispute.
Events Affecting Guarantor. Any of the preceding events occurs with respect to any guarantor,
endorser, surety, or accommodation party of any of the indebtedness or any guarantor, endorser,
surety, or accommodation party dies or becomes incompetent, or revokes or disputes the validity of,
or liability under, any guaranty of the indebtedness evidenced by this Note.
Change In Ownership. Any change in ownership of twenty-five percent (25%) or more of the common
stock of Borrower.
Adverse Change. A material adverse change occurs in Borrowers financial condition, or Lender
believes the prospect of payment or performance of this Note is impaired.
Insecurity. Lender in good faith believes itself insecure.
Cure Provisions. If any default, other than a default in payment is curable and if Borrower has not
been given a notice of a breach of the same provision of this Note within the preceding twelve (12)
months, it may be cured if Borrower, after Lender sends written notice to Borrower demanding cure
of such default: (1) cures the default within fifteen (15) days; or (2) if the cure requires more
than fifteen (15) days, immediately initiates steps which Lender deems in Lenders sole discretion
to be sufficient to cure the default and thereafter continues and completes all reasonable and
necessary steps sufficient to produce compliance as soon as reasonably practical.
LENDERS RIGHTS. Upon default, Lender may declare the entire unpaid principal balance under this
Note and all accrued unpaid interest immediately due, and then Borrower will pay that amount.
ATTORNEYS FEES; EXPENSES. Lender may hire or pay someone else to help collect this Note if
Borrower does not pay. Borrower will pay Lender that amount. This includes, subject to any limits
under applicable law, Lenders attorneys fees and Lenders legal expenses, whether or not there is
a lawsuit, including attorneys fees, expenses for bankruptcy proceedings (including efforts to
modify or vacate any automatic stay or injunction), and appeals, Borrower also will pay any court
costs, in addition to all other sums provided by law.
JURY
WAIVER. To the extent permitted by applicable law. Lender and Borrower hereby waive the right
to any jury trial in any action, proceeding, or counterclaim brought by either Lender or Borrower
against the other.
GOVERNING LAW. This Note will be governed by federal law applicable to Lender and, to the extent
not preempted by federal law, the laws of the State of California without regard to its conflicts
of law provisions. This Note has been accepted by Lender in the State of California.
DISHONORED ITEM FEE. Borrower will pay a fee to Lender of $15.00 if Borrower makes a payment on
Borrowers loan and the check or preauthorized charge with which Borrower pays is later dishonored.
RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a right of setoff in
all Borrowers accounts with Lender (whether checking, savings, or some other account). This
includes all accounts Borrower holds jointly with someone else and all accounts Borrower may open
in the future. However, this does not include any IRA or Keogh accounts, or any trust accounts for
which setoff would be prohibited by law. Borrower authorizes Lender, to the extent permitted by
applicable law, to charge or setoff all sums owing on the indebtedness against any and all such
accounts.
COLLATERAL. Borrower acknowledges this Note is secured by Collateral as described in two (2)
Commercial Security Agreements each dated March 23, 2010.
ARBITRATION. Borrower and Lender agree that all disputes, claims and controversies between them
whether individual, joint, or class in nature, arising from this Note or otherwise, including
without limitation contract and tort disputes, shall be arbitrated pursuant to the Rules of the
American Arbitration Association in effect at the time the claim is filed, upon request of either
party. No act to take or dispose of any collateral securing this Note shall constitute a waiver of
this arbitration agreement or be prohibited by this arbitration agreement. This includes, without
limitation, obtaining injunctive relief or a temporary restraining order; invoking a power of sale
under any deed of trust or mortgage; obtaining a writ of attachment or imposition of a receiver; or
exercising any rights relating to personal property, including taking or disposing of such property
with or without judicial process pursuant to Article 9 of the Uniform Commercial Code. Any
disputes, claims, or controversies concerning the lawfulness or reasonableness of any act, or
exercise of any right, concerning any collateral securing this Note, including any claim to
rescind, reform, or otherwise modify any agreement relating to the collateral securing this Note,
shall also be arbitrated, provided however that no arbitrator shall have the right or the power to
enjoin or restrain any act of any party. Borrower and Lender agree that in the event of an action
for judicial foreclosure pursuant to California Code of Civil Procedure Section 726, or any similar
provision in any other state, the commencement of such an action will not constitute a waiver of
the right to arbitrate and the court shall refer to arbitration as much of such action, including
counterclaims, as lawfully may be referred to arbitration. Judgment upon any award rendered by any
arbitrator may be entered in any court having jurisdiction. Nothing in this Note shall preclude any
party from seeking equitable relief from a court of competent jurisdiction. The statute of
limitations, estoppel, waiver, laches, and similar doctrines which would otherwise be applicable in
an action brought by a party shall be applicable in any arbitration proceeding, and the
commencement of an arbitration proceeding shall be deemed the
commencement of an action for these purposes. The Federal Arbitration Act shall apply to the
construction, interpretation, and enforcement of this arbitration provision.
PRIMARY BANKING RELATIONSHIP. Borrower and Lender acknowledge and agree that Borrower now maintains
or will maintain its primary banking relationship, including its primary deposit account
relationship (Primary Banking Relationship), with Lender. In the event Borrower ceases to
maintain its Primary Banking Relationship with Lender (as determined by Lender in its sole
discretion), the interest rate margin set forth in this Note shall be increased by one percent
(1.00%) from zero percent (0.00%) to one percent (1.00%), at Lenders option, following a five (5)
day written notice to the Borrower.
SUCCESSOR INTERESTS. The terms of this Note shall be binding upon Borrower, and upon Borrowers
heirs, personal representatives, successors and assigns, and shall inure to the benefit of Lender
and its successors and assigns.
NOTIFY US OF INACCURATE INFORMATION WE REPORT TO CONSUMER REPORTING AGENCIES. Borrower may notify
Lender if Lender reports any inaccurate information about Borrowers account(s) to a consumer
reporting agency. Borrowers written notice describing the specific inaccuracy(ies) should be sent
to Lender at the following address: COMMUNITY BANK Loan Support Group P.O. Box 54477 Los Angeles,
CA 90054.
PROMISSORY NOTE | ||||
Loan No: 7100839 | (Continued) | Page 3 |
GENERAL PROVISIONS. This Note is payable on demand. The inclusion of specific default provisions or
rights of Lender shall not preclude Lenders right to declare payment of this Note on its demand.
If any part of this Note cannot be enforced, this fact will not affect the rest of the Note. Lender
may delay or forgo enforcing any of its rights or remedies under this Note without losing them.
Borrower and any other person who signs, guarantees or endorses this Note, to the extent allowed by
law, waive any applicable statute of limitations, presentment, demand for payment, and notice of
dishonor. Upon any change in the terms of this Note, and unless otherwise expressly stated in
writing, no party who signs this Note, whether as maker, guarantor, accommodation maker or
endorser, shall be released from liability. All such parties agree that Lender may renew or extend
(repeatedly and for any length of time) this loan or release any party or guarantor or collateral;
or impair, fail to realize upon or perfect Lenders security interest in the collateral; and take
any other action deemed necessary by Lender without the consent of or notice to anyone. All such
parties also agree that Lender may modify this loan without the consent of or notice to anyone
other than the party with whom the modification is made. The obligations under this Note are joint
and several.
PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE, INCLUDING
THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO THE TERMS OF THE NOTE.
BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE.
BORROWER:
BISCO INDUSTRIES, INC. |
||||
By: | /s/ GLEN F. CEILEY | |||
GLEN F. CEILEY, Chairman and CEO of BISCO INDUSTRIES, INC. |
||||
LASER
PRO Lending. Ver 5.55.00.002 Copr, Harland Financial
Solutions, Inc. 1997, 2011. All Rights Reserved CA
G:\CFISO\CFI\LPL\020.FC TR-12974 PR-UCCSEC