Exhibit 10.7
NATIONAL BANK OF CANADA
ACKNOWLEDGMENT OF DEBT
REVOLVING DEMAND CREDIT
In consideration of the National Bank of Canada (thereinafter
called the "Bank") providing the undersigned thereinafter called
the "Customer") with a revolving demand loan facility
(thereinafter called the "Loan Facility") in the aggregate
principal amount, not exceeding $ 900,000.00
, Nine Hundred
Thousand______________________________________________________________________
__________________________xx dollars (x CDN: / / CDN or US Equivalent: / / US)
the customer agrees with the following::
1. TERMS OF CREDIT
The customer promises to pay the Bank, on demand, all amounts outstanding
under this Loan Facility including, without limitation, principal, interest,
fees and accessories.
2. INTEREST RATE
X 2.1 Advances in CDN$
Advances in CDN$ shall bear interest, until payment in full, at the
Canadian Prime Rate of the Bank plus 1.00 per cent, calculated
daily and payable monthly, with a minimum charge of $ 10.00 .
At the date hereof the Canadian Prime Rate of the Bank is
per cent per annum.
/ / 2.2 Advances in US$
Advances in US$ shall bear interest, until payment in full, at the US
Base Rate of the Bank plus per cent, calculated daily and
payable monthly, with a minimum charge of $ . At that date
hereof the US Base Rate of the Bank is Per cent per annum.
3. FINANCING CONDITIONS
3.1 The Customer authorizes the Bank, but the Bank is not obliged, to debit
from time to time his Account with the amount of interest accrued and
unpaid by the Customer.
3.2 Provided that the Bank has not demanded payment of any amount
outstanding under this Loan Facility, or has not terminated this
Agreement, the Customer may, at the Bank's discretion, borrow, repay
and reborrow up to the amount available under this Loan Facility at
any time and from time to time in the following manner:
3.2.1 The Customer authorizes the Bank, daily or otherwise as and
when determined by the Bank from time to time, to ascertain
the position or net position (as the case may be) between
the Customer and the Bank in respect to the deposit account
or, if more than one, the deposit accounts maintained by the
Customer with the Bank (herein called the "Account") and that
3.2.1.1 If such position or net position is a credit in
favour of the Customer, the Bank may apply the
amount of such credit or any part thereof, rounded
to the nearest $ 15,000.00 as a repayment of the
Loan Facility, and the Bank will debit the Account
with the amount of such repayment; and
3.2.1.2 If such position or net position is a debit in
favour of the Bank, the Bank will make an advance
under the Loan Facility of such amount, rounded to
the nearest $15,000.00 as is required to place the
Account in such credit or net credit position as
has been agreed between the customer and the Bank
from time to time, and the Bank may increase the
unpaid balance owing under the Loan Facility, and
credit the Account with the amount of such advance:
provided that at no time shall the balance owing
exceed the amount of the Loan Facility.
3.3 The Customer agrees to maintain an average monthly minium credit
balance in the Account, which may include compensating balances to
cover service charges, reserves and debit float. Such balance shall
be the amount agreed to in writing between the Customer and the Bank
from time to time.
3.4 The Bank shall maintain on the books of its unit of account,
accounts and records evidencing the outstanding principal amount of
the loan of the Bank to the Customer under this Loan Facility
together with any interest in respect thereof. The Bank shall
maintain a record or computerized data of the amount of the
balance, each advance, and each payment of principal and interest
on account of the loan. The Bank's accounts and records constitute
in the absence of manifest
error prima facie evidence of the indebtedness of the Customer to the
Bank under this Loan Facility.
4. CONSOLIDATION
4.1 The Customer acknowledges that the outstanding principal balance
owing to the Bank under existing credit facilities which will be
replaced by this Loan Facility is $ ,
dollars,
as at the close of business on 19 . The initial outstanding
principal balance under this Loan Facility will be adjusted to
reflect transactions under the existing credit facility occurring
between 19 and the date of execution of this
agreement. The Customer acknowledges and declares that the security
previously granted to the Bank by the Customer remains in full
force and effect. The Bank hereby reserving all of its rights,
title and interest to and in the rights, hypothecs and privileges
granted to the Bank under the terms of said security.
5. SECTION 427 OF THE BANK ACT
5.1 This Agreement is given pursuant to the application for credit and
promise to give security made by the undersigned to the Bank and
dated the 17th day of June 1996, and any supplemental application
for credit and promise to give security. The Customer promises to
give the Bank from time to time warehouse receipts and/or bills of
lading covering the property described in such application(s) for
credit and promise(s) to give security or any part thereof which is
now or may hereafter be covered by warehouse receipts or bills of
lading, as security for this Loan Facility. No such security shall
be merged in any subsequent security or be taken to be substituted
for any security previously acquired. This section applies only to
loans granted under the provisions of the Bank Act.
6. INTERPRETATION
6.1 Definitions
For the purposes hereof, the following words and phrases shall have
the following meaning:
"Canadian Dollars" "CDN$": means lawful money of Canada.
"Canadian Prime Rate": means the annual variable rate of interest
announced from time to time by the Bank and used to determine the
interest rates on Canadian dollar commercial loans granted by the
Bank in Canada.
"Debt", "Indebtedness" or "total indebtedness": means the aggregate
amount of principal, interest and accessories due by the Customer
hereunder.
"Floating Rate": means the interest rate applicable to floating rate
advances made hereunder in Canadian or U.S. dollars, as the case
may be.
"U.S. Base Rate": means the annual variable rate of interest
announced from time to time by the Bank and used to determine the
interest rates on U.S. dollar commercial loans granted by the Bank
in Canada.
"U.S. Dollars" "US$": means lawful money of the United States of
America.
6.2 Conversion to U.S. or Canadian dollars
Each time an amount in Canadian dollars must be converted or
expressed in U.S. dollars, or the equivalent in U.S. dollars (or
inversely) must be determined, such calculation shall be made, on
the appropriate date, in accordance with the cash purchase rate of
the Bank at about 10:30 a.m.
6.3 Other Agreements
The Customer acknowledges that the terms of this agreement are in
addition to and not in substitution for any terms and conditions of
any other agreements between the Customer and the
Bank.
7. GENERAL TERMS AND CONDITIONS OF REPAYMENT
7.1 Currency and place of payment
All amounts due by the Customer under the terms hereof shall be
paid by the Customer to the Bank in Canadian dollars in the case
of a
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financing granted in Canadian dollars, or in U.S. dollars in the
case of a financing granted in U.S. dollars.
Should the amount of principal of the debt owing to the Bank
exceed the credit limit effectively granted hereunder, the
Customer shall reimburse the Bank, on demand, an amount equal to
such excess amount.
7.2 Judgment rendered in a currency other than the currency in which
the financing granted was due
Should a judgment be obtained against the Customer for an
amount owned by it, in a currency other than the one in which
the said amount was owing hereunder, the Customer shall pay the
Bank, as applicable, on the judgment date, such additional
amount as is equal to the excess of the amount that was due
hereunder and converted into the other currency, on the
judgment payment date, with respect to the judgment amount.
The exchange rate applicable for the purposes of obtaining the
judgment and for calculating said conversion shall be the rate
at which the Bank is able, on the appropriate date, in Montreal
to sell the currency applicable to this agreement to purchase
the other currency.
Any additional amount owing, under this clause
shall be due as a separate debt from that which
gave rise to the judgment, which judgment shall
not constitute resjudicata.
8. LANGUAGE
The Customer has expressly requested that this document be drawn up and
executed in the English language.
EXECUTED AT TORONTO THIS 25TH DAY OF APRIL, 1997
Per: /S/
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SIGNATURE (Bank) SIGNATURE (Customer)
Per: /S/
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SIGNATURE (Customer)
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