EXHIBIIT 10.6
CENTURA. COMMERCIAL NOTE
UNSECURED/SECURED
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CUSTOMER NO. Winston-Salem , NC
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NOTE NO. July 21, 1997
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$1,500,000.00
__
/_/ Master Note
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FOR VALUE RECEIVED, the undersigned, jointly and severally, promise(s) to pay to
CENTURA BANK ("Bank"), or order, the sum of ONE MILLION FIVE HUNDRED THOUSAND
AND 00/100---------------------------------------------------------------------
Dollars ($1,500,000.00) or so much as shall have been disbursed from time to
time and remains unpaid, including or together with interest at the rate and
payable in the manner hereinafter stated. Principal and interest shall be
payable at any banking office of Bank in the city or town indicated above, or
such other place as the holder of this Note may designate.
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INTEREST RATE (ONE OF THE FOLLOWING MUST BE SELECTED. TERMS APPEARING NEXT TO
BLOCKS NOT CHECKED ARE DELETED.) All payments made on this Note will be applied
first to accrued interest and then to principal. Interest will accrue on the
unpaid principal balance at the rate set forth below until maturity and will
accrue on any unpaid interest before maturity and on any unpaid balance after
maturity as set forth on the reverse side of this Note. Interest payable on this
Note per annum will be at the rate of:
/_/ Centura Index Rate +--------------------- /_/ Centura Prime Rate +---------------------% /_/ ------------------------% Fixed
/_/ Business Base Rate +---------------------% |X| Wall Street Journal Prime + 0.00% /_/ Other --------------------
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"Centura Index Rate" and "Centura Prime Rate" are Bank's variable rate base
indices and are defined on the reverse side hereof.
Interest will be calculated on the basis of: |X| Actual days/360 day year /_/ Actual days/365 day year /_/ Other ----------------
Adjustments to rates subject to change will be made without prior notice at the
sole option of Bank and will be effective:
|X| *As of the date the rate changes. /_/ Other ---------------------------
(Asterisked term selected if no term checked.)
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PRINCIPAL PAYMENTS TERMS (ONE OF THE FOLLOWING MUST BE SELECTED. PAYMENT TERMS
NOT CHECKED ARE DELETED.) Principal (and interest if indicated under Interest
and Payment Terms below) shall be payable as follows:
/_/ Payable on demand, or on _______________________________, 19_____ if demand
is not sooner made (the time of payment is herein referred to as "Maturity").
|X| Payable in one single payment on JANUARY 21, 1997 (herein referred to as
"Maturity").
/_/ Payable in _______________________ equal consecutive _______________________
payments of $_______________________________ each, commencing
(monthly, quarterly, semi-annual, etc.)
on ______________________________________, 19___ and on the same day of each
such calendar period thereafter and one final payment of the entire balance due
on ______________________________________, 19___ (herein referred to as
"Maturity").
/_/ Other -------------------------------------------------------------------
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INTEREST PAYMENT TERMS (ONE OF THE FOLLOWING MUST BE SELECTED. PAYMENT TERMS NOT
CHECKED ARE DELETED.) Interest shall be payable as follows:
|X| Payable QUARTERLY beginning ----------------------------------- OCTOBER 1,
1997 and consecutively on the same -------------------------------- --
calendar day of each such calendar day of each such calendar period thereafter.
/_/ The payment amount selected above under "PRINCIPAL PAYMENT TERMS' includes
interest.
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PREPAYMENT (ONE OF THE FOLLOWING MUST BE SELECTED. PREPAYMENT TERM NOT CHECKED
IS DELETED. ASTERISKED TERM SELECTED IF NO TERM CHECKED.)
|X| *This Note may be prepaid in whole or in part at any time
without any fee.
/_/ This Note may be prepaid in whole or in part at any time only on payment of
the following fee:------------------------------------------------------
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LOAN AGREEMENT AND SECURITY (ONE OR MORE OF THE FOLLOWING MUST BE SELECTED. LOAN
AGREEMENT AND SECURITY TERMS APPEARING NEXT TO BLOCKS NOT CHECKED ARE DELETED.)
/_/ The Bank and undersigned have entered into a Loan Agreement dated
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/_/ UNSECURED. This Note is unsecured except as provided in the Loan Agreement,
if any, and in paragraphs 1 and 2 below.
|X| SECURED. This Note is secured by collateral described in the following
security instruments: /_/ Assignment of Life Insurance dated /_/ Assignment of
Time Deposit dated _______________________ /_/ Deed of Trust dated
________________ covering:
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|X| Collateral Pledge and Security Agreement dated 10-10-96 covering: 61,303
shares of Omega Healthcare Investor, Inc.
/_/ Security Agreement dated _________________________ covering:
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/_/ Other---------------------------------------------------------------------
1) At maturity of this Note, or upon default, Bank is authorized and empowered
to apply to the payment hereof, any and all money deposited in Bank in the
name of or to the credit of each party, without advance notice, and is
authorized to offset any obligation of Bank to any party to the payment
hereof.
2) Collateral securing other loans of each party with Bank may also secure this
loan and this loan may also be supported by separate Guaranty Agreement(s).
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ADDITIONAL TERMS: THIS NOTE IS SUBJECT TO THE ADDITIONAL TERMS AND PROVISIONS
CONTAINED ON THE REVERSE SIDE, WHICH ARE EXPRESSLY MADE A PART OF THIS NOTE BY
REFERENCE
IN WITNESS WHEREOF, this Note is executed (i) if by individuals, by
hereunto setting their hands under seal by adoption of the word "SEAL" appearing
next to the individuals' names, (ii) if by a corporation, by the duly authorized
officer(s) of the corporation on its behalf under seal by adoption of the
facsimile seal printed hereon for such purpose or, if an impression seal appears
hereon, by affixing such impression seal, or (iii) if by a partnership, by the
duly authorized partner(s) of the partnership on its behalf under seal by
adoption of the word "SEAL" appearing next to the name of the partnership and/or
the signatures of the partner(s), on the day and year first above written.
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________________________(SEAL) CUSTOMER NUMBER DIVERSIFIED CUSTOMER
(INDIVIDUAL) SENIOR SERVICES, NUMBER
INC. (SEAL)
(PARTNERSHIP OR
CORPORATION)
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________________________(SEAL) CUSTOMER NUMBER
(INDIVIDUAL) By: S// ( SEAL)
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Vice President/CFO
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________________________(SEAL) CUSTOMER NUMBER
INDIVIDUAL) By: S// ( SEAL)
--------------------------------
(Title)
________________________(SEAL) CUSTOMER NUMBER Attest: CORP.
(INDIVIDUAL) S// SEAL
--------------------------------
Secretary
DEFAULT Any of the following shall constitute an event of default:
(1) the failure to make when due any payment described
herein, whether of principal, interest or otherwise; (2) the
failure of any party hereto to perform any of the terms and
conditions written into the Loan Agreement or security
instrument(s) securing this Note or any guaranty agreement
or security instrument(s) securing such guaranty agreement
which apply to this Note; (3) the death, dissolution,
merger, consolidation or termination of existence of any
party; or if any party is a corporation with thirty-five
(35) or fewer shareholders, the aggregate transfer(s) of
voting shares in such party whereby persons or entities not
owning on the date hereof, singly or in the aggregate, 50%
or more of the voting shares of such party, become the
owner(s), singly or in the aggregate, of 50% or more of such
voting shares, or if such party is a limited or general
partnership, any change in general partnership interest(s)
in such party; (4) the application for the appointment of a
receiver for any party or the filing of a petition under any
provisions of the Bankruptcy Code or Act by or against any
party or any assignment for the benefit of creditors by or
against any party; (5) the failure of any party to furnish
from time to time, at the Bank's request, financial
information with respect to such party; (6) a determination
by Bank that it deems itself insecure or that an adverse
change in the financial condition of any party has occurred
since the date hereof; (7) the failure of any party to
perform any other obligation to Bank; (8) the termination of
any guaranty agreement which applies to this Note.
LATE CHARGES,
EXPENSES AND
ACCELERATION Each party agrees to pay any late charges permitted by
applicable law that Bank may, in its discretion, charge for
late payments. If this Note is not paid in full whenever it
becomes due and payable, each party agrees to pay all costs
and expenses of collection, including a reasonable
attorney's fee in the amount of (15) percent of the then
outstanding balance. Upon the occurrence of an event of
default, the entire unpaid balance of this Note shall, at
the option of Bank, become immediately due and payable,
without notice or demand. Failure to exercise the option to
accelerate shall not constitute a waiver of the right to
exercise same in the event of any subsequent default.
INTEREST Upon the nonpayment of any payment of interest described
herein, the Bank, at its option and without accelerating
this Note, may accrue interest on such unpaid interest at
the rate(s) applicable hereunder from time to time until
maturity of this Note. After maturity of this Note, whether
by acceleration or otherwise, interest will accrue on the
unpaid principal of this Note and any accrued but unpaid
interest at the contract rate provided for herein until this
Note is paid in full. After entry of judgment, interest
shall accrue at the contract rate provided for herein,
provided however, if the loan evidenced by this Note was
extended for personal, family, household or agricultural
purposes, interest shall be at the legal rate as in effect
from time to time not to exceed the contract rate. The
purpose of the loan represented by Borrower to Bank on the
application for this loan shall control the interest rate
charged after judgment.
THIS IS A VARIABLE RATE NOTE, unless denoted as a fixed rate
note. Any change in the contract rate of interest will equal
the change in the variable rate index to which the contract
rate is tied, but will not exceed the maximum contract rate
permitted by applicable law, or the maximum rate specified
on the form of this Note, if any, whichever is lower.
The "Centura Prime Rate" is one of the Bank's variable rate
base indices for credit extensions and is set by Bank at its
discretion based on the Bank's perception of market interest
rate levels, trends and a general economic conditions. It is
not tied to any specific index published by any third party
and is not represented by Bank to be the lowest rate at
which Bank extends credit.
The "Business Base Rate" is one of the Bank's variable rate
base indices for credit extensions and is set by Bank at its
discretion based on the bank's perception of market interest
rate levels and trends for commercial loans to small
business borrowers and on general economic conditions. It is
not tied to any specific index published by any third party.
It is not the same as and it is not tied to the Centura
Prime Rate. It will typically be higher than the Centura
Prime Rate.
The "Centura Index Rate" is one of the Bank's variable rate
base indices for credit extensions and is set by Bank at its
discretion based on the Bank's cost of funds and on the
Bank's perception of market interest rate levels, trends and
general economic conditions. It is not tied to any specific
index published by any third party. It is not the same as
and it is not tied to the Centura Prime Rate. It will
typically be higher than the Centura Prime Rate.
The "Wall Street Journal Prime Rate" is defined as that
interest rate listed as the PRIME RATE as published each
business day in the Money Rates guide in the Money &
investing section of The Wall Street Journal, Eastern
Edition (if more than one rate is listed, the lowest rate
will be used). The Wall Street Journal Prime Rate is not
represented by Bank to be the lowest rate at which Bank
extends credit. Borrower understands that Bank may make
other loans based on other indices as well.
WAIVER Each party waives presentment, demand, protest and notice of
dishonor, waives any rights which they may have to require
Bank to proceed against any other person or property, agrees
that without notice to any party and without affecting any
party's liability, Bank, at any time or times, may grant
extension of the time for payment or other indulgences to
any party or permit the renewal, amendment or modification
of this Note, the Loan Agreement or security instrument(s),
or permit the substitution, exchange or release of any
security for this Note and may add or release any party
primarily or secondarily liable, and agrees that Bank may
apply all moneys made available to it from any party of the
proceeds from the disposition of any security for this Note
either to this Note or to any other obligation of any of the
parties to Bank, as Bank may elect from time to time.
PARTIES Each signatory of this Note is herein sometimes referred to
as "Party" or collectively as "Parties" and each agrees to
be liable hereunder jointly and severally. This Note shall
apply to and bind each party's heirs, personal
representatives, successors and assigns. All references in
this Note to Bank shall include the holder thereof and this
Note shall inure to the benefit of any holder, its
successors and assigns. Each party acknowledges that
Customer Numbers may be added to this Note at the places
indicated after execution of this Note by the parties and
that the information under the heading "BANK USE ONLY" may
also be completed by Bank after execution of this Note by
the parties. Each party agrees to Bank inserting Customer
Numbers and the information under the heading "BANK USE
ONLY" after execution of this Note by the party and that the
insertion of such information shall not affect the validity
of this Note or the liability of each party hereunder. In
addition, in the event the date of the Note is omitted from
the upper right corner on the obverse side hereof, each
party consents that the Bank may insert the date for
administrative purposes of identifying the Note and that
this consent is without prejudice to any party's right to
dispute the accuracy of the date so inserted. However, such
insertion shall not affect the validity of this Note or the
liability of each party hereunder.
PARTIES' DUE
DILIGENCE All parties hereto acknowledge and represent that they have
relied upon their own due diligence in making their own
independent evaluations of the purposes for which the
proceeds of this Note will be used and the business affairs
and financial condition of all parties hereto, and they will
continue to be responsible for making their own appraisals
of such matters. The parties hereto have not relied upon and
will not hereafter rely upon Bank for such information for
such appraisal or other assessment or review and, further,
will not rely upon any such information which may not or
hereafter be prepared by Bank for any appraisals regarding
the purposes for which the proceeds of this Note will be
used or the parties hereto.
CREDIT The Bank is authorized to investigate from time to
INVESTIGATION time the credit of each party and to answer questions
relating to the Bank's credit experience with each party.
MASTER NOTE If this Note is designated on its face as a MASTER NOTE,
then this Note evidences a revolving line of credit under
the Loan Agreement or security instrument(s) and each party
shall be liable for only so much of the principal amount as
shall be equal to the total of the amounts advanced to or
for each party by the Bank from time to time less all
payments made by or for each party and applied by the Bank
to principal, and for interest on each such advance, all as
shown on Bank's books and records which shall be prima facie
evidence of the amount owned.
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BANK USE ONLY (THIS SECTION IS NOT A For Real Estate Loans Only
PART OF THIS NOTE)
City #_____________ Branch # Collateral Location Code
_____________ Officer _____________
Comp. Call Code * _____________ Collateral Type Code
Purpose Code _____________
Loan Grade ____ CRA Code _____ SIC Conforming/Nonconforming
Code _____ (mark either C or N)
*Loans secured by real estate should
have a Real Estate Comp. Call Code.
Tied to Line ( ) Yes ( ) No #
___________ Revolving Note ( ) Yes
( ) No
Appraised Value
Participation Purchased ( ) Yes ( $___________________________
) No Correspondent # _______________ 1 - Revenues * $1 million
___ 2-Revenues * $1 million
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Business/property address:
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Amount Advanced $_____________
Effective Date __________________ ______________________________
GUARANTEED BY:
Name Customer # Notice Percent
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CENTURA. UNCONDITIONAL GUARANTY
JULY 21, 1997
(Date of Execution and Delivery)
OBLIGOR(S): DIVERSIFIED SENIOR SERVICES, INC. 915 WEST FOURTH STREET, WINSTON-SALEM, FORSYTH NC
_____________________________________________________________________________________________________________________
(Print Full Name) (No. Street or RFD) (City) (County) (State)
GUARANTOR(S):TAYLOR HOUSE ENTERPRISES, LTD. 915 WEST FOURTH STREET WINSTON-SALEM, FORSYTH NC
_____________________________________________________________________________________________________________________
(Print Full Names) (No. Street or RFD) (City) (County) (State)
OBLIGEE: CENTURA BANK: PO BOX 5039, 2150 COUNTRY CLUB ROAD, WINSTON-SALEM, FORSYTH NC
______________________________________________________________________________________________________________________
(Mailing Address)(No. and Street) (City) (County) (State)
WHEREAS, the above OBLIGOR(S) (hereinafter jointly and severally termed
"CUSTOMER") desire(s) to obtain extensions of credit and/or a continuation of
credit extensions and/or to engage in business transactions and enter into
various contractual relationships and otherwise to deal with CENTURA BANK
(hereinafter termed "BANK"); and
WHEREAS, BANK is unwilling to extend or continue to extend credit to and/or to
engage in business transactions and entire into various contractual
relationships with, and otherwise to deal with CUSTOMER; unless it receives an
unconditional continuing, joint and several guaranty from the above identified,
undersigned GUARANTOR(S) (each, any and all of whom are hereinafter termed
"GUARANTOR"), covering all "Obligations of CUSTOMER," as hereinafter defined.
NOW THEREFORE, in connection of, the premises and of other good and valuable
consideration, and IN ORDER TO INDUCE BANK, from time to time, in its sole
discretion TO EXTEND OR CONTINUE TO EXTEND CREDIT (with or without security) TO
AND/OR TO ENGAGE IN BUSINESS TRANSACTIONS AND ENTER INTO VARIOUS CONTRACTUAL
RELATIONSHIPS WITH CUSTOMER (without limiting the generality of the foregoing,
this Guaranty is being given in order to induce BANK to lease and/or sell real,
personal and/or mixed property to CUSTOMER, to purchase or discount any
Acceptances, Accounts, Chattel Paper, Checks, Contracts, Contract Rights,
Drafts, General Intangibles, Instruments, Investment Securities, Land Contracts,
Purchase Money Security Agreements (Conditional Sale Contracts of real and/or
personal property), Real and/or Personal Property Leases, or any other
instruments or evidences of indebtedness (with or without recourse) upon which
CUSTOMER, jointly or severally, is or may be liable as maker, co-maker,
indorser, acceptor, guarantor, surety or otherwise AND OTHERWISE TO DEAL WITH
CUSTOMER), GUARANTOR (jointly and severally, if more than one) HEREBY ABSOLUTELY
AND UNCONDITIONALLY GUARANTEES TO BANK and its successors and assigns, THE DUE
AND PUNCTUAL PAYMENT OF ALL INDEBTEDNESS, OBLIGATIONS AND LIABILITIES OF SAID
CUSTOMER TO BANK, and all claims of BANK, against the CUSTOMER primary or
secondary (whether by way of indorsement or otherwise), whether now existing or
hereafter arising, whether arising out of contract(s), tort(s) or otherwise,
whether created directly with BANK or acquired by BANK through assignment,
indorsement or otherwise; whether matured or unmatured; whether absolute or
contingent; whether joint or several; whether secured or unsecured; whether
monetary or nonmonetary; whether liquidated or unliquidated, as and when the
same become due and payable (whether by acceleration or otherwise), in
accordance with the terms of any instruments, accounts receivable, security
agreements, land and/or other contracts, drafts, leases, chattel paper, debts,
obligations or liabilities evidencing any such indebtedness, obligations,
liabilities, or claims, including all renewals, extensions, substitutions and/or
modifications thereof (all indebtedness, obligations and liabilities of the
CUSTOMER to BANK and claims of BANK against CUSTOMER, including all of the
foregoing, being hereinafter collectively termed "Obligations of CUSTOMER")
PROVIDED, HOWEVER, THAT the maximum liability, jointly and severally, of the
undersigned GUARANTORS hereunder, at any one time outstanding, with respect to
the aggregate principal amount of the "Obligations of CUSTOMER," shall not
exceed the sum of money here specified, plus all interest or Financing Charges
thereon, Costs of Court, default interest thereon, late payment charges and the
reasonable attorney's fees of BANK, TO WIT:
ONE MILLION FIVE HUNDRED THOUSAND AND 00/100 ($1,500,000.00).
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FURTHER if the Obligations of CUSTOMER or this Guaranty are referred to an
attorney-at-law, including BANK'S in-house counsel, for collection, whether or
not suit is commenced, Guarantor expressly hereby agrees to pay all legal
expenses and the reasonable attorneys' fees. GUARANTOR hereby stipulates and
agrees that, if suit is instituted, 15% of the total amount(s) due hereunder and
remaining unpaid at the time suit is instituted by BANK shall be deemed to be
the "reasonable attorneys' fees."
In order to implement the foregoing and as additional inducements to BANK,
GUARANTOR further covenants and agrees:
1. This guaranty is and shall remain an unconditional and continuing guaranty
of payment and not of collection, shall remain in full force and effect
irrespective of any interruption(s) in the business or other dealings and
relations of CUSTOMER with BANK and shall apply to and guarantee the due and
punctual payment of all "Obligations of CUSTOMER" due by CUSTOMER to BANK. To
that end, GUARANTOR hereby expressly waives any right to require BANK to bring
any action against any CUSTOMER or any other person(s) or to require that resort
be had to any security or to any balance(s) of any deposit or other account(s)
or debt(s) or credit(s) on the books of BANK in favor of CUSTOMER or any other
person(s) and without limiting the generality of the foregoing, undersigned
GUARANTOR herewith expressly waives any rights he otherwise might have had under
the provisions of G.S. SS.26.7, ET SEQ. and/or other North Carolina Laws to
require BANK to attempt to recover against CUSTOMER and/or to realize upon any
securities or collateral security which BANK holds for the Obligations of
CUSTOMER. Any GUARANTOR may, by a WRITTEN NOTICE, delivered personally to or
received by certified or registered United States Mail by an Officer of BANK
actually involved in the transactions being guaranteed hereby, at the address of
BANK first above given, terminate this Guaranty with respect to all "Obligations
of CUSTOMER" incurred or contracted by CUSTOMER, acquired by BANK, or otherwise
arising more than thirty (30) business days after the date on which such WRITTEN
NOTICE is so delivered to or received by said BANK officer. Such written notice
of termination shall be the sole and exclusive method for terminating this
Guaranty as to future Obligations of CUSTOMER and notwithstanding termination,
this Guaranty and all security given for this Guaranty and/or the Obligations of
CUSTOMER shall remain in full force and effect as to all Obligations of CUSTOMER
incurred, existing, or arising in any
manner pre-termination, incuding, without limitation, all Obligations of
CUSTOMER arising under loan commitments which exist pre-termination and all
Obligations of CUSTOMER under lines of credit and/or revolving lines of credit
for advances both pre- and post-termination.
2. TIME IS OF THE ESSENCE HEREOF. Any notice(s) to GUARANTOR shall be
sufficiently given, if mailed to the first above stated address(es) of
GUARANTOR.
3. This Guaranty Agreement constitutes the ENTIRE AGREEMENT between the
parties with respect to this Guaranty, and no waivers or modifications shall be
valid unless they are reduced to writing, duly executed by the party to be
charged thereby, and expressly approved in writing by an Officer of BANK
actually involved in the transactions being guaranteed hereby. This Guaranty
does not terminate, cancel, supersede, renew, or substitute for any existing
guarantee to BANK by any GUARANTOR, unless expressly provided herein, and the
execution and delivery hereafter to BANK by any GUARANTOR of a new guarantee
shall not terminate, cancel, supersede, or be a renewal or substitution for this
Guaranty, unless expressly provided therein, and all rights and remedies of BANK
hereunder, under any existing guarantee, or under any guarantee hereafter given
to BANK by any GUARANTOR shall be cumulative and may be enforced singly or
concurrently.
4. If any process is issued or ordered to be served upon BANK, seeking to
seize CUSTOMER'S and/or GUARANTOR'S rights and/or interests in any bank
account(s), such bank account(s) shall be deemed to have been and shall be
set-off against any and all "Obligations of CUSTOMER" and/or all obligations and
liabilities of GUARANTOR hereunder, as of the time of the issuance of any such
writ or process, whether or not CUSTOMER, GUARANTOR and/or BANK shall then have
been served with notice therewith.
5. All moneys available to and/or received by BANK for application toward
payment of (or reduction of) the "Obligations of CUSTOMER" may be applied by
BANK to such individual debt(s) in such manner, and apportioned in such
amount(s) and at such time(s), as BANK, in its sole discretion, may deem
suitable or desirable.
6. As security for any and all liabilities of GUARANTOR hereunder, now
existing or hereafter arising, GUARANTOR hereby grants BANK a security interest
in any and all moneys or other property (i.e., goods and merchandise, as well as
all documents relative thereto, also, funds, investment securities, chooses in
action and any and all other forms of property, whether real, personal or mixed,
and any right, title, or interest of GUARANTOR therein or thereto) and/or the
proceeds thereof, which have been or may hereafter be, deposited or left with
BANK (or with any agent or other third party acting on BANK'S behalf) by or for
the account or credit of GUARANTOR, including (without limitation of the
foregoing), any property in which GUARANTOR may have any interest. Further,
where any obligation of GUARANTOR is due and unpaid BANK hereunder, BANK is
herewith authorized to exercise its right of Set-Off or "Bank Lien" as to any
moneys deposited in demand, checking, time, savings, or other accounts or any
nature maintained in and with it by any of the undersigned, without advance
notice. Such right of Set-Off shall also be applicable and exercised by BANK, in
its sole discretion, where BANK is indebted to any GUARANTOR by reason of any
Certificate(s) of Deposit, Bond(s), Note(s) or otherwise.
7. GUARANTOR acknowledges that any termination of liability hereunder, as
provided for in paragraph 1 above shall not terminate this Guaranty as to
existing Obligations of CUSTOMER nor release GUARANTOR from full liability for
"Obligations of CUSTOMER" hereby guaranteed and then in existence including,
without limitation, all Obligations of CUSTOMER arising under loan commitments
which exist pre-termination and all Obligations of CUSTOMER under lines of
credit and for revolving lines of credit for advances subsequent to the
effective date of termination, or from full liability for renewal(s) or
extension(s) of the "Obligations of CUSTOMER" in whole or in part, whether such
renewals or extensions are made before or after the effective date of such
termination, and with or without notice to GUARANTOR, and for substitution
therefor, or modifications thereof.
8. The termination of the Guaranty by one or more GUARANTORS, or the release,
settlement or compromise by BANK with respect to any one or more GUARANTORS,
shall not affect the obligations of liability of the remaining GUARANTORS
hereunder, and as to the remaining GUARANTORS, this Guaranty shall continue in
effect as if such GUARANTORS had been the only GUARANTORS executing this
Guaranty.
9. GUARANTOR agrees that his liability hereunder shall not be diminished by
any failure on the part of BANK to prefect or continue perfection of (by filing,
recording or otherwise) any security interest(s) it may have in any property
securing this Unconditional Guaranty and/or the "Obligations of CUSTOMER"
secured hereby and hereunder.
10. GUARANTOR further hereby consents and agrees that BANK may at any time,
or from time to time, in its sole discretion: (i) renew, extend or otherwise
change the time of payment, and/or the manner, place or terms of payment of any
or all of the "Obligations of CUSTOMER" or otherwise modify the Obligations of
CUSTOMER; (ii) grant indulgences generally from time to time to the CUSTOMER
and/or any other person liable for the "Obligations of CUSTOMER"; (iii)
exchange, release and/or surrender all or any of the collateral security, or any
part(s) thereof, by whomsoever deposited, which is or may hereafter be held by
it or in which it has a lien or security interest in connection with all or any
of the "Obligations of CUSTOMER" and/or any liabilities or obligations of
GUARANTOR hereunder; (iv) sell or otherwise dispose of and/or purchase all or
any of any such collateral at public or private sale, or to or through any
Investment Securities Broker, and after deducting all costs and expenses of
every kind for collection, preparation for sale, sale or delivery, the net
proceeds of any such sale(s) or other disposition may be applied by BANK upon
all or any of the "Obligations of CUSTOMER"; and (v) settle or compromise with
the Customer, any insurance carrier and/or any other person(s) liable thereon,
any and all of the "Obligations of CUSTOMER," and/or subordinate the payment of
all or any part of same, to the payment of any other debts or claims, which may
at any time(s) be due or owing to BANK and/or any other persons(s); all in such
manner and upon such terms as BANK may deem proper and/or desirable, and without
notice to or further assent from GUARANTOR, it being agreed that GUARANTOR shall
be and remain bound upon this Unconditional Guaranty, irrespective of the
existence, value or condition of any collateral, or the impairment of any
collateral (to include, without limitation, failure to perfect a security
interest in collateral), or the unenforceability of any of the Obligations of
CUSTOMER or the discharge of or release of CUSTOMER from liability for any of
the Obligations of CUSTOMER and notwithstanding any such change, exchange,
settlement, compromise, surrender, release, sale or other disposition,
application, renewal or extension and notwithstanding also that the "Obligations
of CUSTOMER" may at any time(s) exceed the aggregate principal sum hereinabove
prescribed (if any such limiting sum appears). If BANK should request GUARANTOR
to consent to any of the foregoing, such request and/or consent by GUARANTOR
shall not constitute a waiver by BANK of the provisions of this paragraph which
permit such actions without GUARANTOR's consent, nor of any other provision of
this Guaranty relating to acts or inactions of BANK and such request and/or
consent shall not create a course of dealing between BANK and GUARANTOR that
would require the consent of GUARANTOR to any of the foregoing in the future.
Further, this Guaranty shall not be construed to impose any obligation on BANK
to extend or continue to extend credit or otherwise deal with CUSTOMER at any
time.
11. If CUSTOMER is an organization, this Guaranty covers all "Obligations of
CUSTOMER" purporting to be created or undertaken on behalf of such organization
by any officer, partner, manager or agent of such organization, without regard
to the actual authority of any such officer, partner, manager or agent, whether
or not corporate or partnership resolutions, proper or otherwise, are given by
any CUSTOMER to BANK, and/or whether or not such purported organizations are
legally chartered or organized.
12. This Unconditional Continuing Guaranty shall be binding upon GUARANTOR,
and the heirs, executors, administrators, successors and assigns of GUARANTOR;
and it shall inure to the benefit of, and be enforceable by BANK, and its
successors, transferees and assigns. The death of GUARANTOR shall not terminate
any liability hereunder. This Unconditional Guaranty shall remain in force after
GUARANTOR's death until written notice of termination, sent by a legal
representative of GUARANTOR, is received by BANK as set forth in paragraph 1
above and such termination shall be limited as provided in paragraphs 1 and 7
above.
13. This Unconditional Guaranty shall be deemed to have been made under and
shall be governed by the Laws of the State of North Carolina in all respects,
including matters of construction, validity and performance. Further, all terms
of expressions contained herein which are defined in Articles 1, 3, or 9 of the
North Carolina Uniform Commercial Code shall have the same meaning herein as in
said Articles of said Code.
14. No waiver by BANK of any default(s) by GUARANTOR or CUSTOMER shall
operate as a waiver of any other default or of the same default on a future
occasion. If more than one person has signed this Guaranty, such parties are
jointly and severely obligated hereunder. Further, use of the masculine of
neuter pronoun herein shall include the masculine, feminine OR neuter, and also
the plural. The term "GUARANTOR," as used herein, shall (if signed by more than
one person) mean the "GUARANTORS and each of them." If any GUARANTOR shall be a
partnership, the obligations, liabilities and agreements on the part of such
GUARANTOR shall remain in full force and effect and fully applicable
notwithstanding any changes in the individuals composing the partnership.
Further, the "GUARANTOR" shall include in such event any altered or successive
partnerships, it being also understood that the predecessor partnership(s) and
their partners shall not thereby be released from any obligations or liabilities
hereunder, BANK, or any other holder hereof, may correct patent errors in this
Guaranty.
15. GUARANTOR hereby waives: (i) notice of acceptance of this Guaranty; (ii)
notice(s) of extensions of credit and/or continuations of credit extensions to
CUSTOMER by BANK; (iii) notice(s) of entering into and engaging in business
transactions and/or contractual relationships and any other dealings between
CUSTOMER and BANK; (iv) presentment and/or demand for payment of any of the
"Obligations of CUSTOMER"; (v) protest or notice of dishonor or default to
GUARANTOR or to any other person with respect to any of the "Obligations of
CUSTOMER" or with respect to any security therefor; (vi) all other notices to
which GUARANTOR might otherwise be entitled; (vii) any demand for payment under
this Guaranty; (viii) any defense of any kind which the CUSTOMER might have; and
(ix) application of any other defenses available to GUARANTOR.
16. Anything contained herein to the contrary notwithstanding, if for any
reason the effective rate of interest on any of the Obligations of CUSTOMER
should exceed the maximum lawful contract rate, the effective rate of such
obligation(s) shall be deemed reduced to and shall be such maximum lawful
contract rate, and any sums of interest which have been collected in excess of
such maximum lawful contract rate shall be applied as a credit against the
unpaid principal balance due hereunder.
17. In the event any provision(s) of this instrument should be left blank or
incomplete, GUARANTOR hereby authorizes and empowers BANK to supply and complete
the necessary information to complete or fill in the blank provision(s).
18. Should any one or more provisions of this Unconditional Guaranty be
determined to be illegal or unenforceable by a court of competent jurisdiction,
the other provisions shall remain in full force and effect.
19. In the event of a change in, or amendment or modification of the legal
status or existence of the CUSTOMER, this Guaranty shall continue and shall also
cover the indebtedness of the CUSTOMER under the new or amended status,
according to the terms hereof guaranteeing the Obligations of the original
CUSTOMER.
20. The obligation of any GUARANTOR executing this Unconditional Guaranty
shall not be dependent upon the subsequent execution hereof by any other person.
21. GUARANTOR shall provide BANK with such financial information as BANK may
from time to time request. Any statement of account or records that bind the
CUSTOMER shall be binding against the GUARANTOR and the records of BANK
maintained in the ordinary course of its business with respect to the
Obligations of CUSTOMER shall be binding on GUARANTOR in all respects,
including, without limitation, the extent and nature of the Obligations of
CUSTOMER and the liabilities of GUARANTOR under this Guaranty.
22. GUARANTOR warrants and covenants that GUARANTOR has made such inquiries
as GUARANTOR deems necessary in order to ascertain the financial condition of
CUSTOMER, and has, in fact, ascertained the financial condition of CUSTOMER and
is satisfied with such financial condition, that GUARANTOR has adequate means to
obtain from CUSTOMER, on a continuing basis, information concerning the
financial condition of CUSTOMER, and that GUARANTOR has not relied, and will not
rely, on BANK to provide such information, now or in the future.
23. GUARANTOR agrees that in the event judgment or any court order or
administrative order for turnover or recovery is entered against BANK (whether
by consent, compromise, settlement or otherwise) for, or BANK is required or
agrees to repay (i) the amount of any monetary payment or transfer of any
property (whether real, personal or mixed, tangible or intangible, or the value
thereof) made to BANK by or on behalf of the CUSTOMER and/or GUARANTOR for
credit to the Obligations of CUSTOMER, or (ii) the amount of any set-off(s)
exercised by BANK and credited to Obligations of CUSTOMER, the then in such
event (and notwithstanding the prior discharge or satisfaction in whole or in
part of any or all Obligations of CUSTOMER due BANK or the written or stamped
notation of cancellation, release or satisfaction affixed to this GUARANTY or
any instrument of indebtedness evidencing the Obligations of CUSTOMER, or any
prior notice of the termination of this Guaranty as to future debts of CUSTOMER)
the amount of value of any such payments, property or set-off(s) recovered from
BANK shall be deemed to be Obligations of CUSTOMER and this GUARANTY and the
liabilities of GUARANTOR hereunder shall be automatically revived and reinstated
and shall continue and remain in full force and effect as to the same, together
with interest thereon from date of recovery at the rate(s) applicable to the
Obligations of CUSTOMER to which such payments, transfers or set-off(s) were
credited, costs of court, and the reasonable attorney's fees incurred by BANK in
connection therewith.
24. GUARANTOR further expressly waives, for BANK'S benefit and the benefit of
CUSTOMER and any other guarantor, maker or endorser of the Obligations of
CUSTOMER, any and all rights of recourse against CUSTOMER, or any other
guarantor, maker, or endorser of the Obligations of CUSTOMER, or property or
assets of the same, arising out of any payment made under or pursuant to this
GUARANTY, including any claim or subrogation, reimbursement, exoneration,
contribution or indemnity that the undersigned GUARANTOR may have against the
CUSTOMER, any other guarantor, or maker or endorser of the Obligations of
CUSTOMER. GUARANTOR will not enter into any contract or agreement in violation
of the provisions hereinabove, and any such purported contract or agreement
shall be void ab initio.
25. EVENTS OF DEFAULT. GUARANTOR shall be in default under this Unconditional
Guaranty upon the happening of any of the following events, circumstances or
conditions, to wit:
(a) Default in the payment or performance of any of the obligations or of any
covenant, warranty or liability contained or referred to herein, or contained in
any other contract or agreement of CUSTOMER and/or GUARANTOR with BANK, whether
now existing or hereafter arising; or
(b) Any warranty, representation or statement made or furnished to BANK by or
on behalf of CUSTOMER and/or GUARANTOR, in connection with this Guaranty
Agreement or to
induce BANK to extend credit or otherwise deal with CUSTOMER and/or GUARANTOR
proving to have been false in any material respect when made or furnished; or
(c) Death, dissolution, termination of existence, insolvency, business
failure, appointment of a Receiver of any part of the property of, Assignment
for the Benefit of Creditors by, or the commencement of any proceeding under any
State or Federal Bankruptcy or Insolvency Laws by or against GUARANTOR and/or
CUSTOMER; or
(d) Failure of a corporate CUSTOMER and/or GUARANTOR to maintain its
corporate existence in good standing; or
(e) Upon the entry of any monetary judgment or the assessment and/or filing
of any tax lien against either CUSTOMER and/or GUARANTOR or upon the issuance of
any writ of garnishment of attachment against any property of, debts due or
rights of CUSTOMER and/or GUARANTOR, to specifically include the commencement of
any action of proceeding to seize moneys of either CUSTOMER and/or GUARANTOR on
deposit in any bank account with BANK; or
(f) If BANK should otherwise deem itself, any security interests, its
collateral or property, or the "Obligations of CUSTOMER" guaranteed hereby and
hereunder and/or the liability of GUARANTOR hereunder unsafe or insecure, or
should BANK, in good faith, believe that the prospect of payment or other
performance by CUSTOMER and/or GUARANTOR is impaired.
26. REMEDIES OF DEFAULT. Upon the occurrence of any of the foregoing events,
circumstances, or conditions of default, all of the obligations evidenced herein
and secured or guaranteed hereby shall immediately be due and payable without
notice. Further, BANK shall then have all of the rights and remedies granted
hereunder, all of the rights and remedies of a Secured Party and/or
Holder-in-Due Course under the North Carolina Uniform Commercial Code and/or
under other Laws of North Carolina.
27. GUARANTOR acknowledges that GUARANTOR has read this Guaranty and fully
understands the rights granted to BANK herein, and the waiver of rights of
GUARANTOR. GUARANTOR further acknowledges that each of the terms contained
herein is a material inducement to BANK to extend credit to the CUSTOMER and is
necessary in order for the BANK to fully realize the benefits of BANK'S
bargained for agreement with the CUSTOMER and GUARANTOR.
This Guaranty is secured by: _________________________________________________
______________________________________________________________________________
IN WITNESS WHEREOF, this Guaranty is executed (i) if by individuals, by hereunto
setting their hands under seal by adoption of the word "SEAL" appearing next to
the individuals' names, (ii) if by a corporation, by the duly authorized
officers of the corporation on its behalf under seal by adoption of the
facsimile seal printed hereon for such purpose or, if an impression seal appears
hereon, by affixing such impression seal, or (iii) if by a partnership, by the
duly authorized partners of the partnership on its behalf under seal by adoption
of the word "SEAL" appearing next to the name of the partnership and/or the
signatures of the partners, on the day and year first above written.
TAYLOR HOUSE ENTERPRISES, LTD.
_______________________________(SEAL)
(NAME OF CORPORATION OR PARTNERSHIP)
Attest:
By: /S/ G.L. CLARK, JR. (SEAL)
Vice President & CFO (TITLE)
____________________ Secretary
___________________________(SEAL)
CORP
____ ___________________________(SEAL)
SEAL
___________________________(SEAL)
___________________________(SEAL)