Exhibit 10.24
MASTER GRID NOTE
(SECURED REVOLVING LINE OF CREDIT)
$ 3,000,000.00 October 31, 1996
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FOR VALUE RECEIVED, the undersigned, Edwards Capital Corp., DOES HEREBY
PROMISE TO PAY on or before June 30 , 1997 to the order of FIRST BANK OF THE
AMERICAS (the "Bank"), at its office at 375 Park Avenue, New York, New York
10152, in lawful money of the United States and in immediately available funds,
the principal amount of THREE MILLION DOLLARS ($ 3,000,000.00) or, if less, the
aggregate unpaid principal amount of all advances (the "Advances") made to the
undersigned by the Bank.
The undersigned promises to pay interest on the aggregate unpaid principal
amount of this Note from the date of the initial Advance until such aggregate
principal amount is paid in full, in like money, at said office at a rate per
annum equal to, at the option of the undersigned, one and one quarter percent
(1.25%) above LIBOR or zero percent (0.0%) above the prime rate set forth by
First Bank of The Americas (the "Prime Rate"), on a floating rate basis, such
interest to be payable on the first day of each month during the term hereof and
on the date of payment in full of this Note. Any amount of principal hereof
which is not paid when due, whether after demand or an Event of Default, shall
bear interest from the date when due until said principal amount is paid in
full, at a rate per annum equal to five percent (5%) above the Rate then in
effect. Any change in the interest rate resulting from a change in the Prime
Rate shall be effective as of the beginning of the day on which such change in
the Prime Rate becomes effective.
The undersigned hereby authorizes the Bank to endorse on the grid annexed
to this Note all Advances made to the undersigned and all payments of principal
and interest in respect to such Advances, which endorsements shall, in the
absence of manifest error, be conclusive as to the outstanding principal amount
of all Advances; provided, however, that the failure to make such notation with
respect to any Advance or payment shall not limit or otherwise affect the
obligations of the undersigned under this Note or any other agreement or
document delivered in connection therewith.
Payments and Computations
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The undersigned shall have the right, without penalty, at any time to
prepay this Note in whole or, from time to time, in part. The undersigned hereby
authorizes the Bank to charge, from time to time, any or all of the
undersigned's accounts with the Bank any amounts, which have not been paid when
due.
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If the Bank elects not to extend this line of credit beyond June 30, 1997
the Bank will notify the undersigned in writing and the payment of all Advances
under this Note will be extended one time only and shall be due and payable on
or before August 31, 1997 provided that there are no events of default under the
line or under any other credit facilities extended by the Bank.
All computations of interest shall be made by the Bank on the basis of a
year of 360 days for the actual number of days occurring in the period for which
such interest is payable. Whenever any payment to be made hereunder shall be
stated to be due, on a day other than a business day, such payment shall be made
on the next succeeding business day, and such extension of time shall in such
case be included in the computation of interest.
Events of Default
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Upon the occurrence and continuation of any of the following events (each
an "Event of Default"): (i) if any of the Liabilities of the Undersigned (as
hereinafter defined) shall not be paid when due, or (ii) if it appears, in the
Bank's good faith opinion, at any time that any representation in any agreement
or financial or other statement of any Obligor (as hereinafter defined)
delivered to the Bank by or on behalf of any Obligor is untrue in any material
respect or omits any material fact, or (iii) if a material adverse change, in
the Bank's good faith opinion, shall occur in the financial condition of any
Obligor, or (iv) if any Obligor shall die or be dissolved, or shall become
insolvent (however evidenced), or (v) upon the suspension of business of any
Obligor, or (vi) upon the commencement of any proceeding under (or the use of
any of the provisions of) Article 52 of the New York Civil Practice Law and
Rules by any judgment creditor against any Obligor which has not been stayed or
dismissed within 60 days, or with respect to any property of any Obligor, or
(vii) upon an assignment for the benefit of creditors by any Obligor, or (viii)
upon a trustee or receiver being appointed for any Obligor or for any
substantial part of the property thereof, or (ix) upon any proceedings being
commenced by or against any Obligor under bankruptcy, reorganization,
arrangement of debt, insolvency, receivership, liquidation or dissolution law or
statute and, if commenced against any Obligor, such proceedings shall not have
been stayed or dismissed within 60 days, or (x) if any governmental authority or
any court at the instance thereof shall take possession of any substantial part
of the property, or assume control over the affairs or operations of, any
Obligor, or (xi) if any indebtedness of any Obligor for borrowed money in an
amount in excess of $10,000 shall become due and payable by acceleration or
maturity thereof, or (xii) if the undersigned shall be party to any merger or
consolidation without the written consent of the Bank, or (xiii) if the
undersigned without the written consent of the Bank, shall grant or permit to
exist any security interest, pledge, mortgage or lien whatsoever (other than
liens which are not material in amount) in or on any of its property or shall
file or authorize or permit to be filed in any jurisdiction any financing
statement under the Uniform Commercial Code or like document under applicable
law other than in the ordinary course of business, or (xiv) if the ratio of
Senior Debt + Unsecured Debt/(Subordinated Debt + Tangible Net Worth) for the
undersigned shall exceed 1.25, or (xv) if the current ratio of the undersigned
shall be less than 3.25, or (xv) if tangible net worth of the undersigned shall
be less than $8,750,000 THEN AND
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IN ANY SUCH EVENT, all Liabilities of the Undersigned shall become at once due
and payable, without notice, presentment or demand for payment, all of which are
hereby expressly waived.
The term "Liabilities of the Undersigned" shall mean the obligations of the
undersigned under this Note and any other agreement delivered to the Bank. The
term "Obligor" shall include the undersigned and each endorser, guarantor and
surety on this Note.
Other
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The undersigned shall pay all costs and expenses of every kind incurred in
connection with the enforcement of any Liabilities of the Undersigned, including
reasonable attorney's fees.
The undersigned hereby agrees that any legal action or proceeding against
it for enforcement of this Note and any other Liabilities of the Undersigned, or
any judgment with respect thereto may be brought in the courts of the State of
New York, or elsewhere, as the Bank may elect, and the undersigned hereby
irrevocably submits to the nonexclusive jurisdiction of each of said courts. The
undersigned irrevocably consents to service of process by mail in such action
and to the removal to any of such courts by the Bank of any action brought by
the undersigned in any court other than the one selected by the Bank in its sole
discretion, as the venue of such action. The undersigned waives trial by jury
and agrees not to raise any present or future claim it may have against the Bank
in any action brought by the Bank to enforce or collect this Note.
Any Advance under this Note shall be subject to no material adverse change
in the undersigned's financial condition or that of the Obligors in Bank's sole
judgment.
Until all of the Liabilities of the Undersigned are paid in full, the
undersigned hereby agrees to: (i) keep true and complete books, records and
accounts; (ii) keep its properties in good repair and maintain adequate
insurance against fire, theft and other such risks as is customary with other
comparable entities; promptly pay all taxes, unless contested in good faith, as
well as all lawful claims for labor, materials and supplies which, if unpaid
might become a lien or charge on its properties; (iii) furnish to Bank (a)
within 90 days after the end of each fiscal year financial statements audited
(certified) by an independent public accounting firm acceptable to Bank, and (b)
within 60 days after the close of each fiscal quarter, similar statements
certified by the undersigned's Chief Executive Officer, and (c) within 90 days
of the close of each fiscal year 10K reports for Medallion Financial Corp., and
(d) within 45 days of the close of each fiscal quarter 10Q reports for Medallion
Financial Corp.; and execute and deliver such further instruments and documents
and perform such further acts as may be necessary or proper, in our opinion, to
effectuate the provisions and purposes of the Note and all related Agreements.
The undersigned hereby represents and warrants, as of the date of the
execution of this Note, that: (i) the undersigned's financial statements
submitted to Bank are true and correct and
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fairly reflect its financial condition as of the date of such statements and no
material change has occurred since such date; (ii) the undersigned has filed all
tax returns which are required to be filed and has paid all taxes which have
become due pursuant to such returns or pursuant to any assessment; (iii) the
Note and all related documents have been or will be duly authorized, executed
and delivered and constitute valid, legally binding and enforceable Obligations
in accordance with their terms; (iv) except for the Bank's security interest,
all accounts receivable, inventory and the proceeds and products thereof are
free and clear of any liens or encumbrances.
This Note is secured by a Security Agreement dated October 31, 1996 by the
undersigned to the Bank, reference to which is hereby made for a description of
the collateral provided for thereunder and the rights of the Bank with respect
to such collateral.
No delay on the part of the Bank in exercising any of its options, powers
or rights, or partial or single exercise thereof, shall constitute a waiver
thereof. The options, powers and rights of the Bank specified herein are in
addition to those otherwise created. This Note and the rights and obligations of
the Bank and of the undersigned hereunder shall be governed by and construed in
accordance with the law of the State of New York.
Edwards Capital Corp.
By: /s/ Michael Kowalsky
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Title: President
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By: /s/ Daniel F. Baker
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Title: Treasurer
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SCHEDULE OF LOANS AND PAYMENTS
DATE AMOUNT OF LOAN AMOUNT OF PRINCIPAL PAID BALANCE REMAINING UNPAID NOTATION MADE BY
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LOAN NO._____________________
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