EXHIBIT 10.10
LOAN AGREEMENT
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This LOAN AGREEMENT is made and entered into by and between SUNWEST BANK OF
ALBUQUERQUE, NATIONAL ASSOCIATION, a national banking association, hereinafter
referred to as "Bank," and New Mexico Utilities, Inc., a New Mexico
corporation, hereinafter referred to as "Borrower".
For and in consideration of the mutual covenants, agreements and
obligations herein contained, it is agreed as follows:
1. CREDIT. Bank has agreed to furnish the following credit facilities
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(the "Loans") to Borrower under the terms and conditions hereinafter set forth:
Note A: A revolving line of credit up to, but not exceeding, Two Million and
No/100 Dollars ($2,000,000).
Note B: A revolving line of credit up to, but not exceeding, Five Hundred
Thousand and 00/100 Dollars ($500,000).
2. LOANS. The Loans shall be extended in varying amounts from time to
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time as follows:
(a) Coincident with the execution hereof, Borrower will execute separate
promissory notes payable to Bank, the form and substance of which shall be
acceptable to Bank, and which shall bear interest and be due and payable as
follows:
(i) The per annum interest on the outstanding principal balance (the
"Interest Rate") shall be at a rate equal to one-half percent (0.5%) over the
Chase
Manhattan Bank Prime Rate established from time to time by that Bank; the
Interest Rate shall be adjusted coincident with any change in the rate and
applied prospectively.
(ii) Interest only on the outstanding principal balance shall be
payable monthly. Payments shall be due and payable on the last day of the
each month beginning on the first (1st) month following the date of the
first advance and continuing until the principal balance with accrued
interest shall be paid in full.
(iii) The entire principal balance plus accrued interest shall be due
and payable March 31, 1996 or upon demand in the event Borrower becomes in
default under this Agreement.
(b) Payments shall be applied first to interest and the balance, if
any, shall then be applied to reduce principal, however, if Borrower is not in
default of this agreement, then at Bank's option payments may be applied to
principal.
3. PURPOSE. The proceeds of Note A shall be used only to pay for utility
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system improvements. The proceeds of Note B shall be used for working capital
purposes.
4. COLLATERAL. The Loans are unsecured.
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5. GUARANTY. The Loans shall be guaranteed by an Unlimited Continuing
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Guaranty of Southwest Water Company which shall be in form and substance
acceptable to Bank, which guarantees payment of
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Borrower's indebtedness evidenced by the Notes and which further guarantees
Borrower's performance of the provisions of this Loan Agreement.
6. BORROWER'S REPRESENTATIONS AND WARRANTIES. Borrower represents and
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warrants to Bank, which representations and warranties shall survive the
delivery of the Notes, that:
(a) Borrower is a corporation duly organized, legally existing and in good
standing under the laws of the State of New Mexico and has duly qualified as a
foreign corporation to do business in all other jurisdictions wherein the
property owned or the business transacted by it makes such qualification
necessary.
(b) The Borrower has full power and authority and legal right to incur the
obligations provided for in this Agreement, to execute and deliver, and to
perform and observe the terms and provisions of this Agreement, the Notes, and
any other agreements or documents referred to herein or contemplated hereby.
Such agreements and documents constitute the legal valid and binding obligations
of the Borrower enforceable in accordance with their respective terms.
(c) The last financial statements of Borrower, which are dated September
30, 1994, fully and accurately reflect the financial condition of Borrower as
of the date hereof and no material adverse change has since occurred in the
condition, financial or otherwise, of Borrower.
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(d) To the best of Borrower's knowledge, there is no litigation, legal or
administrative proceeding, investigation or other action of any nature pending
or, threatened against or affecting Borrower, which involves the possibility of
any judgment or liability which would materially and adversely affect the
business or the assets of Borrower or Guarantors or the right of Borrower to
carry on its business as now conducted; and no unusual or unduly burdensome
restriction, restraint or hazard exists by contract, law or governmental
regulation, other than by restrictions and obligations on and of Borrower to
comply with requirements of the New Mexico Public Utilities Commission, relative
to the business or properties of Borrower.
7. AFFIRMATIVE COVENANTS. Borrower covenants and agrees that:
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(a) Borrower will furnish or cause to be furnished to the Bank in form
acceptable to Bank:
(i) Within forty-five (45) days after the end of each quarter, an
unaudited balance sheet of Borrower, an unaudited operating statement of
Borrower (showing income, expenses and net income or loss), in form
acceptable to Bank and such other financial information as Bank may
require, all as of the end of the preceding quarter, and certified by a
principal officer of Borrower
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as being true and correct and prepared in accordance with generally accepted
accounting principles consistently applied throughout the period indicated;
(ii) Within forty-five (45) days after Borrower's fiscal year end, copies
of Borrower's budget and forecasts for the ensuing fiscal year;
(iii) Within one hundred twenty (120) days after the end of Borrower's
fiscal year end, audited balance sheet and income statements.
(iv) Year end audited balance sheet and income statement, and related and
customary schedules of Guarantor within one hundred twenty (120) days of the end
of its fiscal year end.
(v) Within forty-five (45) days after issuance, a copy of Guarantor's
SEC Report Form 10-Q and 10-K and consolidating schedules for the Balance
Sheet,Income Statement and reconcilement of equity accounts as of the period
ending for which a Form 10-Q is issued.
(b) Borrower will maintain with financially sound and reputable insurers,
insurance with respect to its properties and business against such liabilities,
casualties, risk and contingencies and in such types and amounts as are
acceptable to Bank.
(c) Borrower will pay all fees incurred in connection with this Agreement
and all transactions pursuant thereto,
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including, without limitation, the fees and expenses attributable to the
preparation of all documentation, and all amendments thereto, and for necessary
filings.
(d) Borrower will upon the discovery of the existence of any event of
default hereunder, immediately furnish Bank written notification thereof.
(e) Borrower will keep accurate and complete records of its business
operations and Bank shall have the right, at Borrower's expense and during
normal working hours, without hindrance, to orderly inspect, audit, check and
make abstracts of the records at intervals determined by Bank.
(f) Borrower will provide Bank with written notification of all changes in
the directors or officers of Borrower, which notification shall be given within
ten (10) days of any such change.
8. NEGATIVE COVENANTS. Borrower covenants and agrees with Bank that:
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(a) Borrower will not become a guarantor or surety to or for any other
person, firm or corporation except in ordinary course of business without the
prior written consent of Bank.
(b) Borrower will not mortgage, pledge or otherwise encumber assets in any
manner, nor allow any lien or encumbrance to be placed thereon without the prior
written
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consent of Bank, except that the foregoing restrictions shall not apply to:
(i) Liens for taxes, assessments and other governmental charges not yet
due or being contested in good faith if such reserve as shall be required
by generally accepted accounting principles shall have been made therefor;
(ii) Liens of landlords, vendors, suppliers, carriers, warehousemen,
mechanics, laborers and materialmen arising by law in the ordinary course
of business for sums not yet due or being contested in good faith if a
reserve, as shall be required by generally accepted accounting principles,
shall have been made therefor;
(iii) Lien of First Mortgage Bonds, Series A, due March 12, 2002 in the
amount of Two Million Dollars ($2,000,000) to Allstate Insurance Company.
(c) Borrower will not, without the prior written consent of the Bank:
(i) Amend its articles of incorporation in any way so as to adversely
affect the rights of Bank;
(ii) Consolidate or merge with or purchase all or a substantial part of
the assets or capital stock of any corporation, firm, association or
enterprise. However, purchases of all or a substantial part of the assets
or
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the capital stock of any corporation, firm, association or enterprise
aggregating less than One Million Dollars ($1,000,000) are not hereby
restricted.
(iii) Sell, lease or sell and lease-back or otherwise transfer all or
substantially all of its assets;
(iv) Engage in any material new or additional business line or
activity.
(d) Borrower will not permit its debt to tangible net worth ratio to be
more than 4.0 to 1.0. The debt to net worth ratio will be calculated excluding
amounts in the liability accounts on the Borrower's Balance Sheet entitled
"Contributions in Aid of Construction", and "Deferred Revenue" regardless of how
such amounts are titled on future Balance Sheets.
(e) On December 31, 1995 and at each fiscal year end thereafter, Borrower
will not permit its debt service ratio to be less than 1.20 to 1.0. The debt
service ratio shall be calculated by taking earnings before interest, taxes,
depreciation and amortization divided by principal and interest payments based
on a ten (10) year amortization of First Mortgage Bond obligations, this
commitment ($2,500,000), and other debt incurred, including obligations owed to
Southwest Water Company, for which interest is to accrue. The interest rate to
be considered in the amortization will be the
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rate in effect on the respective obligation effective at each fiscal year end.
(f) For purpose of paragraphs 7(d) and 7(e) all measurements and
calculations shall be determined on the last day of Borrower's fiscal year end.
(g) Borrower will not, unless approved in writing by Bank, pay
any dividend that exceeds ninety percent (90%) of net income after taxes in
any fiscal year.
(h) Borrower will not make any other distributions or loans to any of its
related entities without the prior written permission of the Bank, except
Borrower may continue payment of management fees to Southwest Water Company,
provided that the dollar amount of management fees paid in year 1995 and
succeeding years may not exceed One hundred Fifty Percent (150%) of the amount
actually paid in the prior year unless previously approved in writing by Bank.
9. EVENTS OF DEFAULT. If any one or more of the following events of
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default occurs and is continuing:
(a) Default in the payment of any installment of principal of, or any
interest on, any note executed and delivered pursuant to the terms of this
Agreement or any renewal or extension thereof; or
(b) Default in the due observance or performance of any negative covenant
contained in this Agreement; or
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(c) Any warranty or representation made herein by Borrower to the Bank
is untrue or misleading in any material respect as of the date such warranty or
representation is made or any certificate, statement, or writing furnished by
Borrower to the Bank is untrue in any material respect on the date as of which
the fact set forth are stated or certified; or
(d) Borrower discontinues its business; or
(e) Borrower becomes insolvent or admits in writing its inability to pay
its debts as they mature, or makes an assignment for the benefit of creditors,
or applies for, consents to or acquiesces in the appointment of a trustee or
receiver for Borrower or any of its property; or, in the absence of such
application, consent or acquiescence, proceedings for the appointment of a
trustee or receiver for Borrower or for a substantial part of its property is
authorized or instituted by or against Borrower; or any bankruptcy,
reorganization, debt arrangement or other proceedings under any bankruptcy or
insolvency law or any dissolution or liquidation proceeding is instituted by or
against Borrower; or provided that if any bankruptcy, receivership, liquidation
or similar proceedings are instituted otherwise than by Borrower, such an
occurrence will not constitute an event of default if such proceedings are
dismissed within thirty (30) days of their commencement; or
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(f) A final money judgment (after appeal, if any, has been decided
adversely to Borrower, or after the time to appeal therefrom shall have expired)
shall be entered against Borrower and the same shall remain unsatisfied for more
than thirty (30) days; or
(g) A material adverse change in the financial condition of Borrower occurs
which in the opinion of Bank affects the ability of Borrower to pay in
accordance with its terms any note executed and delivered pursuant to the terms
of this Agreement or any renewal or extension thereof; or
(h) Default in the due observance or performance by Borrower of the
Indenture of Mortgage dated February 14, 1992 securing First Mortgage Bonds,
Series A due March 12, 2002; or
then in any such event of default, the Bank may, at its option, declare all
indebtedness incurred hereunder immediately due and payable and the Bank shall
be under no other or further obligation to make further advances under the terms
of this Agreement. Upon such declaration, the Bank may then proceed to enforce
payment or collection of said indebtedness and to exercise any or all of the
rights and remedies afforded and provided for in this Agreement or in any note,
security agreement or other document executed in connection with the loans to be
made hereunder, anything in said documents to the contrary notwithstanding, or
the Bank may pursue any other remedy available to it, whether in law or
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in equity. All of the above rights and remedies are cumulative, and no delay on
the part of the Bank in exercising any right, power or privilege shall operate
as a waiver of such rights, power or privilege, nor will the partial exercise
thereof operate as a waiver of such right, power or privilege.
10. FUNDING. Bank shall not be obligated to fund the Loans until (i) Bank
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shall have received certified copies of resolutions of the Board of Directors of
Borrower in form and substance satisfactory to the Bank authorizing the
incurring of the indebtedness contemplated hereby; (ii) the execution and
delivery of this Agreement and of the other instruments and agreements provided
for herein to be executed and delivered by Borrower; (iii) all terms and
conditions of Bank's commitment letter dated January 9, 1995 have been duly
satisfied; and (iv) until all other terms and conditions of this Agreement and
such other terms and conditions as Bank may reasonably require have been duly
satisfied by Borrower.
11. MISCELLANEOUS COVENANTS. Bank and Borrower covenant and agree that:
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(a) A waiver of any breach of this Agreement shall not be considered as a
waiver of any subsequent breach thereof, whether or not notice of such breach
and of waiver of same has been given.
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(b) If any term or provision of this Agreement or the application
thereof to any person, corporation, or under any circumstances shall, to any
extent, be invalid or unenforceable, the remainder of this Agreement or the
application of such term or provision to a person or corporation or under
circumstances other than those as to which it has been held invalid or
unenforceable, shall not be affected hereby, and each term and provision of this
Agreement shall be valid and enforceable to the fullest extent permitted by law.
(c) This Agreement supersedes and replaces all prior agreements between the
parties hereto, and this Agreement shall not be amended or modified except by
agreement in writing duly executed by parties affected thereby or as otherwise
provided herein.
(d) Bank shall have no obligation to extend or renew the credit facilities
described herein, but if Bank shall renew or extend such credit facilities, the
terms of this Loan Agreement shall govern all extensions and renewals of the
credit facilities described herein.
(e) The laws of the State of New Mexico shall govern the construction of
this Agreement and the rights and duties of the parties.
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(f) Headings used in this Agreement are for the convenience of reference
only and shall not be deemed to be part of this Loan Agreement for any purpose.
(g) All notices given pursuant to this Agreement shall be in writing and
shall be validly given when hand delivered, mailed by prepaid first class mail
or transmitted by telefax
(1) if to Bank, addressed to:
Sunwest Bank of Albuquerque, National Association
P.O. Box 25500
Albuquerque, New Mexico 87125-0500
Attention: Commercial Loan Department
Telefax # (505) 764-4178
and (2) if to Borrower, addressed to:
New Mexico Utilities, Inc.
4700 Irving Blvd., N.W.
Albuquerque, New Mexico 87114
Attention: Mr. William C. Jasura, Vice President
Telefax # (505) 898-6379
and
Southwest Water Company
225 North Barranca Avenue, Suite 200
West Covina, CA 91791-1605
Attention: Controller
Telefax # (818) 915-1558
(h) Borrower acknowledges that Borrower is aware of the provisions of
the New Mexico statutes including Section 58-6-5 NMSA 1990 Repl. Pamp. which
provide that a promise or commitment to loan money or to grant, extend or renew
credit or any modification thereof is unenforceable unless in writing and signed
by the Bank.
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(i) BORROWER AND BANK HEREBY WAIVE THE RIGHT TO A JURY TRIAL ON ANY
ISSUE ARISING OUT OF OR RELATING, DIRECTLY OR INDIRECTLY, TO THIS AGREEMENT, THE
NOTE, THE GUARANTY, OR ANY DOCUMENT EXECUTED AND DELIVERED PURSUANT TO THIS
AGREEMENT.
DATED: January 25, 1995.
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BORROWER:
NEW MEXICO UTILITIES, INC,
a New Mexico corporation
By: /S/ ROBERT L. SWARTWOUT
Robert L. Swartout,
President
By: /S/ WILLIAM C. JASURA
William C. Jasura
Vice President and
Chief Financial Officer
GUARANTOR:
SOUTHWEST WATER COMPANY
a Delaware corporation
By: /S/ DIANE CASTELLO PITTS
Diane Castello Pitts
Controller and Treasurer
LENDER:
SUNWEST BANK OF ALBUQUERQUE,
NATIONAL ASSOCIATION, a
national banking association
By: /S/ DON K. PADGETT
Don K. Padgett
Vice President
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PROMISSORY NOTE - NOTE A
SUNWEST BANK New Mexico Utilities, Inc.
of Albuquerque, N.A. A New Mexico Corporation
P.O. Box 25500
Albuquerque, NM 87125-5500
(505) 765-2211
"BANK" "BORROWER"
FOR VALUE RECEIVED, Borrower promises to pay to the order of Bank, its
successors and assigns at Albuquerque, New Mexico (or such other place as the
Bank may designate) (i) the principal amount of Two Million and No/100 Dollars
($2,000,000.00), or so much thereof as is advanced; (ii) the fees and other
charges as provided herein; and (iii) per annum interest on the outstanding
principal balance from Date of Disbursement, until paid at the rate of 0.500%
above the index rate for this loan which is Chase Manhattan Bank Prime, in
effect from time to time, and which is published by Chase Manhattan Bank, N.A.,
with a minimum rate of N/A%. As of the date of this note, the index rate is
8.500%. Adjustments in the interest rate will be effective as announced and may
increase or decrease the amount of the regular payments. If the index rate is
discontinued then the interest rate shall be the rate being charged by Bank on
similar loans.
Borrower agrees to pay as follows:
[X] Interest on the 28th day of every single month beginning February 28,
1995, and continuing until this Note is paid in full.
This Loan is payable in full on March 31, 1996. Borrower must repay the
outstanding principal balance of the loan and unpaid interest then due. The
Bank is under no obligation to refinance the loan at that time.
Borrower shall pay Bank a late charge of N/A% or N/A, whichever is less, of
any installment not received by Bank within fifteen (15) days after the
installment is due.
All payments shall be applied first to reduce fees and charges other than
interest, then to reduce interest, then to reduce principal.
[X] This is a multiple advance note. Borrower has received $0.00 and future
principal advances are contemplated. No principal advances will be made after
March 31, 1996. Repaying a part of the principal will entitle Borrower to
additional advances unless an event of default has occurred, or the open-end
feature has expired.
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Each of the following are events of default under this Note: (i) Failure to
make a payment on time or in the amount due; (ii) Default under any agreement
made in connection with or securing this Note; (iii) Borrower's default on any
other agreement with Bank; (iv) Borrower's death, incompetency, bankruptcy or
insolvency; (v) any written statement or financial information provided by
Borrower is untrue or inaccurate; or (vi) any other event which reasonably
causes Bank to be insecure about being repaid or about the adequacy of the
security for this Note.
Upon the occurrence of any event of default contained in this Note, the
Bank may declare the principal amount, accrued interest thereon, and fees and
other charges as provided in this Note immediately due and payable without
notice or demand, refuse to make any further advances under this Note, enforce
its rights under any document securing the indebtedness evidenced by this Note,
set off the amount Borrower owes Bank against any funds on deposit with Bank,
retain the proceeds of any checks, drafts, notes or other instruments or
acceptances which it may hold or have in the process of collection for the
account of any of the makers, endorsers and guarantors hereof and may apply such
proceeds (together with any funds on deposit with Bank) to the payment of the
indebtedness evidenced by this Note, and use any remedy available under state or
federal law.
No delay or omission on the part of Bank in exercising any right hereunder
shall operate as a waiver of such right or of any other right under this Note.
A waiver on any occasion shall not be construed as a bar to, or waiver of, any
such right or remedy on any future occasion.
Every maker, endorser and guarantor of this Note, or the indebtedness
represented hereby waives presentment, demand, notice, protest, and all other
demands and notices in connection with the delivery, acceptance, performance,
default or enforcement of this note and assents to any extension or postponement
of the time of payment or other indulgence, to the addition or release of any
other party or person primarily or secondarily liable on this note or to the
addition or release of any security interest or collateral securing this note.
Any time this Note is placed in the hands of an attorney for collection, or
to defend or enforce any of the Bank's rights hereunder, Borrower shall pay to
the Bank its reasonable attorneys' fees, together with all court costs and other
expenses.
If no default exists hereunder, Borrower may prepay at any time, without
premium or fee, the entire indebtedness or any part thereof evidenced by this
Note and such prepayments shall be applied in the manner scheduled payments are
applied unless Borrower directs Bank to apply such prepayment in reduction of
the outstanding principal indebtedness. Partial prepayments shall not postpone
the due date of any subsequent monthly installments or change the amount of such
installments (other than the amount of interest) and shall not postpone the due
date for payment of the indebtedness evidenced by this Note.
Borrower has delivered and shall deliver to Bank within 120 days after the
end of each annual accounting period of Borrower and at such other times as Bank
may request, copies of its balance sheet, income statement, cash flow analysis,
list of contingent liabilities and such other financial information as Bank may
require, all in reasonable detail, and Borrower warrants and represents to
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Bank that the financial information delivered, and to be delivered, is and will
be true and correct in all material respects, prepared in accordance with
generally accepted accounting principles, consistently applied throughout the
period indicated, within a time and in a form acceptable to Bank.
Borrower acknowledges that a contract, promise or commitment to loan money
or to grant, extend or renew credit or any modification thereof, in an amount
greater that Twenty-Five Thousand Dollars ($25,000), not primarily for personal,
family or household purposes, made by a financial institution shall not be
enforceable unless in writing and signed by the party to be charged or that
party's authorized representative.
This Note is being executed pursuant to a Business Loan Agreement
("Agreement") dated January 25, 1995, and to the extent the terms of this Note
are inconsistent with the Agreement, the terms of the Agreement shall control.
This Note is secured by the following:
DATED this 25th day of January, 1995.
New Mexico Utilities, Inc.
A New Mexico Corporation
By: /S/WILLIAM C. JASURA By: /S/DIANE CASTELLO PITTS
William C. Jasura, V.P. Finance Diane Castello Pitts
and Chief Financial Officer Controller and Treasurer of
Southwest Water Company
Borrower's Primary Business Address: Borrower's Notice Address:
4700 Irving Blvd., N.W., Ste. 201 4700 Irving Blvd.,N.W.,Ste. 201
Albuquerque, NM 87114 Albuquerque, NM 87114
Borrower's Telephone Number: TIN/SS#: 85-0205240
(505) 898-2661
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PROMISSORY NOTE - NOTE B
SUNWEST BANK New Mexico Utilities, Inc.
of Albuquerque, N.A. A New Mexico Corporation
P.O. Box 25500
Albuquerque, NM 87125-5500
(505) 765-2211
"BANK" "BORROWER"
FOR VALUE RECEIVED, Borrower promises to pay to the order of Bank, its
successors and assigns at Albuquerque, New Mexico (or such other place as the
Bank may designate) (i) the principal amount of Five Hundred Thousand and No/100
Dollars ($500,000.00), or so much thereof as is advanced; (ii) the fees and
other charges as provided herein; and (iii) per annum interest on the
outstanding principal balance from Date of Disbursement, until paid at the rate
of 0.500% above the index rate for this loan which is Chase Manhattan Bank
Prime, in effect from time to time, and which is published by Chase Manhattan
Bank, N.A., with a minimum rate of N/A%. As of the date of this note, the index
rate is 8.500%. Adjustments in the interest rate will be effective as announced
and may increase or decrease the amount of the regular payments. If the index
rate is discontinued then the interest rate shall be the rate being charged by
Bank on similar loans.
Borrower agrees to pay as follows:
[X] Interest on the 28th day of every single month beginning February 28,
1995, and continuing until this Note is paid in full.
This Loan is payable in full on March 31, 1996. Borrower must repay the
outstanding principal balance of the loan and unpaid interest then due. The
Bank is under no obligation to refinance the loan at that time.
Borrower shall pay Bank a late charge of N/A% or N/A, whichever is less, of
any installment not received by Bank within fifteen (15) days after the
installment is due.
All payments shall be applied first to reduce fees and charges other than
interest, then to reduce interest, then to reduce principal.
[X] This is a multiple advance note. Borrower has received $0.00 and future
principal advances are contemplated. No principal advances will be made after
March 31, 1996. Repaying a part of the principal will entitle Borrower to
additional advances unless an event of default has occurred, or the open-end
feature has expired.
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Each of the following are events of default under this Note: (i) Failure to
make a payment on time or in the amount due; (ii) Default under any agreement
made in connection with or securing this Note; (iii) Borrower's default on any
other agreement with Bank; (iv) Borrower's death, incompetency, bankruptcy or
insolvency; (v) any written statement or financial information provided by
Borrower is untrue or inaccurate; or (vi) any other event which reasonably
causes Bank to be insecure about being repaid or about the adequacy of the
security for this Note.
Upon the occurrence of any event of default contained in this Note, the
Bank may declare the principal amount, accrued interest thereon, and fees and
other charges as provided in this Note immediately due and payable without
notice or demand, refuse to make any further advances under this Note, enforce
its rights under any document securing the indebtedness evidenced by this Note,
set off the amount Borrower owes Bank against any funds on deposit with Bank,
retain the proceeds of any checks, drafts, notes or other instruments or
acceptances which it may hold or have in the process of collection for the
account of any of the makers, endorsers and guarantors hereof and may apply such
proceeds (together with any funds on deposit with Bank) to the payment of the
indebtedness evidenced by this Note, and use any remedy available under state or
federal law.
No delay or omission on the part of Bank in exercising any right hereunder
shall operate as a waiver of such right or of any other right under this Note.
A waiver on any occasion shall not be construed as a bar to, or waiver of, any
such right or remedy on any future occasion.
Every maker, endorser and guarantor of this Note, or the indebtedness
represented hereby waives presentment, demand, notice, protest, and all other
demands and notices in connection with the delivery, acceptance, performance,
default or enforcement of this note and assents to any extension or postponement
of the time of payment or other indulgence, to the addition or release of any
other party or person primarily or secondarily liable on this note or to the
addition or release of any security interest or collateral securing this note.
Any time this Note is placed in the hands of an attorney for collection, or
to defend or enforce any of the Bank's rights hereunder, Borrower shall pay to
the Bank its reasonable attorneys' fees, together with all court costs and other
expenses.
If no default exists hereunder, Borrower may prepay at any time, without
premium or fee, the entire indebtedness or any part thereof evidenced by this
Note and such prepayments shall be applied in the manner scheduled payments are
applied unless Borrower directs Bank to apply such prepayment in reduction of
the outstanding principal indebtedness. Partial prepayments shall not postpone
the due date of any subsequent monthly installments or change the amount of such
installments (other than the amount of interest) and shall not postpone the due
date for payment of the indebtedness evidenced by this Note.
Borrower has delivered and shall deliver to Bank within 120 days after the
end of each annual accounting period of Borrower and at such other times as Bank
may request, copies of its balance sheet, income statement, cash flow analysis,
list of contingent liabilities and such other financial
20
information as Bank may require, all in reasonable detail, and Borrower warrants
and represents to Bank that the financial information delivered, and to be
delivered, is and will be true and correct in all material respects, prepared in
accordance with generally accepted accounting principles, consistently applied
throughout the period indicated, within a time and in a form acceptable to Bank.
Borrower acknowledges that a contract, promise or commitment to loan money
or to grant, extend or renew credit or any modification thereof, in an amount
greater that Twenty-Five Thousand Dollars ($25,000), not primarily for personal,
family or household purposes, made by a financial institution shall not be
enforceable unless in writing and signed by the party to be charged or that
party's authorized representative.
This Note is being executed pursuant to a Business Loan Agreement
("Agreement") dated January 25, 1995, and to the extent the terms of this Note
are inconsistent with the Agreement, the terms of the Agreement shall control.
This Note is secured by the following:
DATED this 25th day of January, 1995.
New Mexico Utilities, Inc.
A New Mexico Corporation
By: /S/WILLIAM C. JASURA By: /S/DIANE CASTELLO PITTS
William C. Jasura, V.P. Finance Diane Castello Pitts
and Chief Financial Officer Controller and Treasurer of
Southwest Water Company
Borrower's Primary Business Address: Borrower's Notice Address:
4700 Irving Blvd., N.W., Ste. 201 4700 Irving Blvd.,N.W.,Ste. 201
Albuquerque, NM 87114 Albuquerque, NM 87114
Borrower's Telephone Number: TIN/SS#: 85-0205240
(505) 898-2661
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