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HomeMy WebLinkAbout2005-20r • TOWN OF PULASHI, VIRGINIA RESOLUTION 2005-20 AMENDMENT TO RESOLUTION 2005-15 AMENDING AN URBAN DEVELOPMENT ACTION GRANT (UDAG) LOAN/GUARANTY TO MAGNOX WHEREAS, the Town of Pulaski acting by and through the Town Council of the Town of Pulaski has adopted Resolution 2005-15 granting an Urban Development Action Grant (UDAG) Loan/Guaranty for Magnox Corp., and its successors, assigns, and/or Tim Hopkins; and WHEREAS the Town Council of the Town of Pulaski has received from SunTrust Bank a document entitled "Unconditional Three (3) Year Guaranty", attached hereto and expressly made a part hereof and labeled "Attachment "A""; and NOW, THEREFORE, BE IT RESOLVED by the Town Council of the Town of Pulaski, Virginia that Resolution 2005-15 is hereby amended to include the terms and conditions of Attachment "A" and that the Town Manager of the Town of Pulaski is hereby authorized to execute any and all documents necessary to effectuate same and that Magnox Corp. and/or Magnox Acquisitions, Inc. and/or its successors and assigns and/or Tim Hopkins shall at or before closing of the transactions with SunTrust Bank pay to the Town of Pulaski UDAG fund a 1%non-refundable annual (or any portion thereof) fee, as expressed in the loan documents, for the issuance of the Guaranty upon the Town of Pulaski UDAG funds and pay all legal fees, costs and expenses, including but not limited to all recording fees, associated with this transaction for and on the behalf of the Town of Pulaski. • This resolution is effective upon adoption and is hereby adopted this 14th day of April 2005, by recorded vote of the Town Council of the Town of Pulaski, as follows: Bettye H. Steger -Aye Joel B. Burchett, Jr. -Aye John T. Bolen -Absent Jeffrey S. Worrell -Aye Lane R. Penn -Aye Daniel Talbert, Jr. -Aye Town of Pulaski, Virginia ~. By: harles L. Wa e, Mayor ATTESTED: Patricia Cruise, Clerk of Council • Attachment "A" UNCONDITIONAL THREE (3) YEAR GUARANTY THIS INSTUMENT CONTAINS A CONFESSION OF JUDMENT PROVISION WHICH CONSTITUTES A WAIVER OF IMPORTANT RIGHTS YOU MAY HAVE AS A GUARANTOR AND ALLOWS THE CREDITOR TO OBTAIN A JUDGEMENT AGAINST YOU WITHOUT ANY FURTHER NOTICE. WHEREAS, Magnox Acquisitions, Inc., A Virginia Corporation, the "Borrower" desires to transact business with and to obtain a revolving line of credit loan in the maximum principal credit amount of Two Million and 00/100 Dollars ($2,000,000.00) in credit, from SunTrust Bank, its present and future affiliates and their successors and assigns (collectively SunTrust) the "Lender" to provide senior debt financing with the proceeds to be used to (a) finance the asset purchaser of the Magnox manufacturing operations in Pulaski, Virginia the "Acquisition"; (b) pay fees and expenses incurred in connection with the Acquisition; and (c) thereafter for working capital and other general corporate purposes; and, WHERAS, the undersigned is familiar with the financial condition and affairs of the Borrower; and, WHEREAS, the undersigned benefits from the extension of credit to the Borrower, and desires to induce the Lender to extend the credit to Borrower; and, WHEREAS, Lender is unwilling to extend or continue credit to Borrower unless it receives an unconditional three (3) year Guaranty from the undersigned Guarantor with respect to the obligations, as defined below, of Borrower to SunTrust; and, NOW, THEREFORE, for and in consideration of such credit extended and/or to be extended by the Lender to the Borrower and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the undersigned, the undersigned hereby agrees for the benefit of the lender, and its successors, endorsees, and assigns as follows: 1. The Limitations of the undersigned in and to this Guaranty are as follows: a. The maximum liability of the undersigned shall be limited to a sum not in excess of the total sum of Two Hundred Fifty Thousand and 00/100 ($250,000.000); and b. A period of three (3) years from the date of this Guaranty. 2. The undersign shall pledge, and such obligation shall continue during the term of this Guaranty, as collateral with the Lender the principal sum of Two Hundred Fifty Thousand and 00/00 Dollars ($250,000.00) in cash to be placed on deposit with Lender in an interest bearing Certificate of Deposit account number and shall execute and Assignment of Account for the benefit of the Lender in and to said Deposit. The undersigned is entitled to the periodic payment of the interest on the account as set forth by the depository agreement with the Lender, and executed by the undersigned. The undersigned shall execute with this Guaranty an Assignment of Account to Lender, which the undersigned acknowledges perfects the Lender's security interest in and to said account, and that in the event of a default, as hereinafter defined, that in that event, the Lender may exercise it's right herein under this Guaranty in and to the Assignment of Account in and to the aforesaid Deposit, and collect the funds on Deposit in said account or any portion thereof, to be applied by Lender against the obligation of the Borrower as set forth herein. - 3. The undersigned hereby unconditionally and irrevocable guarantees to the Lender and its successors, endorsees and assigns (a) the punctual payment when due, whether by acceleration or otherwise, with such interest as may accrue thereon before or after any maturity thereof, and such prepayment premiums and other charges as maybe due in connection therewith, of a Note of the Borrower in the principal sum of Two Million and 00/100 ($2,000,000.00) dated the _ day of April, 2005, the "Note", which Note is a revolving line of credit, and (b) the punctual payment and/or performance by the Borrower of all covenants, agreements, liabilities and obligations under the Deed of Trust, Security Agreement and Financing Statement securing the Note (the "Security Instrument", or any other agreement or document executed in connection with the Note and Security Instrument (the Note, the Security instrument, and all other such agreements or documents evidencing, securing or executed in conjunction with the Note, other than this Guaranty, being sometimes hereinafter referred to as the "Loan Documents" as the same maybe amended, modified, renewed, or extended), including without limitation, the liability, and obligations of the Borrower under the section of the Security Instrument relating to "Environmental Requirements" (as defined in the Security Instrument), and the payment by the Borrower of any and all sums advanced by the Lender at its option under the terms of the Security Instrument and the other Loan Documents including, but not limited to sums advanced by the Lender for the payment of taxes and insurance premiums, whether such obligations now exist or arise hereafter. The undersigned further agrees to pay all expenses, including attorneys' fees and expenses of legal counsel incurred by the Lender in any way arising from or relating to the enforcement of the Note, this Guaranty, and any related collateral document or other document and the collection or attempted collection, whether by litigation or otherwise of the Note or this Guaranty. The aforesaid is limited howevex to the total sum of $250,000.00 which is the maximum total obligation of the undersigned. This is a Guaranty of payment and performance and not collection. 4. The undersigned consents and agrees that, (a) the whole or any part of the security (including real estate encumbered by the Security Instrument) now or hereafter held for the Note or the other obligations under the other Loan Documents with or without consideration maybe exchanged, compromised, or surrendered from time to time, (b) the time or place of payment of the Note or the obligations under the other Loan Documents or of any security therefore may from time to time be changed or extended, in whole or in part, to a time certain or otherwise, and maybe renewed or accelerated, in whole or in part, (c) the Borrower maybe granted indulgences generally (d) any of the provisions of the Loan Documents may be modified or waived, (e) any party liable for the payment thereof (including, without limitation, any co-guaranty) maybe granted indulgences or released, (f) neither the death, termination of existence, bankruptcy nor disability of the Borrower or any one or more of the guarantors shall affect the continuing obligation of any other guarantor, and that no claim need be asserted against the personal representative, guardian, custodian, trustee or debtor in bankruptcy or receiver of any deceased, incompetent, bankrupt or insolvent guarantor, and (g) any deposit balance of the credit of the Borrower or any other party liable for the payment of the Note or liable for any other obligations under the Loan Documents maybe released, in whole or in part, at, before, and/or after the stated, extended or accelerated maturity of the Note, all without notice to or further assent by the undersigned, who shall remain bound hereon, notwithstanding any such exchange, compromise, surrender, extension, renewal, acceleration, modification, indulgence or release. 5. The obligations of the Lender under the Loan Documents shall conclusively be deemed to have been created, contracted, or incurred in reliance upon this Guaranty, and all dealings between the Borrower and the Lender shall likewise be conclusively presumed to have been undertaken or consummated in reliance upon this Guaranty. The undersigned expressly waives: (a) notice of acceptance of this Guaranty and all extensions of credit to the Borrower; (b) presentment and demand for payment of the Note or of payment or performance under the Security Instrument or the other Loan Documents (c) protest and notice of dishonor or of default to the undersigned or to any other party with respect to the Note or with respect to any security therefore or with respect to the other Loan Documents; (d) any diligence in collecting the Note, this Guaranty or any failure to properly record any document or any other lack of due diligence by the Lender in creating, perfecting or with -respect to the other loan Documents, of protecting or realizing upon any security therefore; (e) any duty or obligation of the part of the Lender to ascertain the validity, extent or nature of any security for the Note, or any insurance or other rights respecting such security, or the liability of any party primarily or secondarily liable for payment of the Note, or liability upon any security therefore, or to take any steps or action to safeguard, protect, handle, obtain or convey information respecting, or otherwise follow in any manner, and such security, insurance or other rights; (f) any duty or obligation of the Lender to proceed to collect payment of the Note from, or to commence an action against the Borrower or any other person, or to resort to any security or to any balance of any deposit account or credit on the books of the Lender in favor of the Borrower or any other person, despite any notice or request of the undersigned to do so; (g) any modification of the Loan Documents or any obligation of Borrower relating to the Loan by operation of law or by action of any court, (h) all other notices to which the undersigned might otherwise be entitled; (i) any defense relative to the financial condition of the Borrower whether or not the undersigned is familiar therewith; (j) demand for payment or performance under this Guaranty; (k) any failure of Lender to commence action against Borrower or any other person or entity (including, without limitation, other guarantors, if any); (1) any invalidity, irregularity or unenforceability, in whole or in part, of any one or more of the Loan Documents; (m) the inaccuracy of any representation or other provision contained in any Loan Document; (n) any sale or assignment of the Loan Documents, in whole or in part; (o) any sale or assignment by Borrower of the collateral, or any portion thereof, whether or not consented to by Lender; (p) any lack of commercial reasonableness in dealing with collateral; (q} any deficiencies in the collateral or any deficiency in the ability of the Lender to collect or obtain performance from any persons or entities now or hereafter liable for the payment or performance of any obligation hereby guaranteed; and (r) any rights of the undersigned pursuant to Virginia Code Section 49-25 or 49-26 or any similar or subsequent law. 6. The liability of the undersigned on this Guaranty shall be direct and immediate and not conditional or contingent upon a demand upon the Borrower or any other person or upon the pursuit of any remedies against the Borrower or any other person or foreclosure of the Security Instrument or any other security interests or liens available to the Lender, its successors, endorsees or assigns. If the Note or other obligations hereby guaranteed are partially paid through foreclosure of the Security Instrument or through the election of the Lender, its successors, endorsees or assigns, to pursue any other remedy mentioned in this paragraph or if the Note and other obligations hereby guaranteed are otherwise partially paid, the undersigned shall remain liable for the balance thereof up to the limits of liability as set forth in this Guaranty. 7. Notwithstanding any payments made by the undersigned under this Guaranty, including any payments made toward the construction or completion of the Improvements or the existence of or realization by the Lender upon any collateral, until all of the obligations of the Borrower under the Note or any security therefore, have been fully paid, the undersigned shall have no right of subrogation to the rights of the Lender under the Note or the other Loan Documents or any security therefore, nor any right to participate in any way in any of the security for the Note or the other Loan Documents or in the right, title and interest of the Lender in and to the property subject to the Security Instrument, all such rights of subrogation and participation being hereby expressly waived and released. It is acknowledged however, that the undersigned shall have separate agreements and security agreements with the Borrower, which the undersigned has the right to enforce against the Borrower, once the obligation herein and to the Lender have been satisfied. 8. This Guaranty is a continuing guaranty, shall remain in force irrespective of any interruptions in the business relations of Borrower with Lender and shall apply to and guarantee any balance which shall remain due by Borrower to Lender. The collateral as set forth herein above and the Assignment of Account requirements of the undersigned, must remain in full force and affect during the terms of this Guaranty and may not be altered or changed without the express written consent of the Lender. 9. This Guaranty shall continue to be effective, or be reinstated, as the case maybe, if at any time payment of any of the obligations under the Note or any security therefore, or any part thereof, is rescinded or must otherwise be restored or returned by the Lender upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of Borrower, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, Borrower or any substantial part of its property, or otherwise, all as though such payments have not been made, provided however, that any such action was commenced against or by the Borrower during the three (3) year term of this Guaranty. 10. This Guaranty shall bind and inure to the benefit of the Lender, its successors and assigns, and likewise shall bind the undersigned, their successors and assigns. This Guaranty contains the entire agreement. Furthermore, no course of dealing between the parties, no usage of trade, and no parol or extrinsic evidence shall be used to supplement or modify any terms of this Guaranty; nor are there any conditions to the complete effectiveness of this Guaranty. Except as maybe otherwise expressly agreed upon in writing, this Guaranty and the liability of the undersigned hereunder shall neither affect nor be affected by any prior or subsequent guaranty by the undersigned of any other indebtedness to the Lender. 11. This Guaranty shall be governed by, and construed and interpreted in accordance with, the Laws of the Commonwealth of Virginia without regard to principles of conflict of Laws. 12. This Guaranty shall not be changed unless expressly agreed to in writing by all parties. 13. This Guaranty maybe executed in any number of counterparts. Each of the counterparts will be considered an original, and all counterparts constitute but one and the same instrument. 14. Guarantor agrees to provide to Lender updated financial information and financial statements within 180 days after the end of its fiscal year, a copy of its audited financial statements containing the unqualified report of its independent certified public accounts. 15. The Lender agrees that as to the delivery of the Environmental report, which is acknowledged will be delivered post closing, that in the event there are any adverse matters in the environmental report, that in that event the Lender will grant a thirty (30) day notice period to the Borrower to cure such matters, before exercising any rights the Lender has in and to this Guaranty or collection upon the collateral secured hereby. 16. The undersigned acknowledges that the Lender may reproduce (by electronic means or otherwise) any of the documents evidencing and/or securing the Note and thereafter may destroy the original documents. The undersigned does hereby agree that any document so reproduced shall be the binding obligation of the undersigned enforceable and admissible in evidence against it to the same extent as if the original document had not been destroyed. 17. No invalidity, irregularity or unenforceability of all or any part of the obligations or any collateral or security therefore shall affect, impair, or be a defense to this Guaranty, and this Guaranty is a primary obligation of Guarantor. 18. This Guaranty shall not be construed to impose any obligation of Lender to extend or continue any credit at any time. 19. No delay on the part of Lender in exercising any rights hereunder or failure to exercise the same shall operate as a waiver of such rights; no notice to or demand on Guarantor shall be deemed to be a waiver of the obligation of the Guarantor or of the right of Lender to take further action without notice or demand as provided f ` ~ • herein; nor in any event shall any modification or waiver of the provisions of this Guaranty be effective unless in writing signed by Lender nor shall any such waiver be applicable except in the specific instance for which given. 20. Guarantor hereby duly constitutes and appoints David W. DeHart and Patricia H. Meredith as its true and lawful attorney-in fact in its name, place and stead, and upon the occurrence of an event of default, to confess judgment against it in the Circuit Court for the County of Pulaski, Virginia, upon this guaranty and all amounts owed hereunder, including all costs of collection, attorneys fees and court costs, hereby ratifying and confirming the acts of the attorney - in- fact as if done by itself, expressly waiving benefit of any homestead or other exemption laws, but subject to the limitation of collection in the total amount of $250,000.00 which is the maximum amount of this Guaranty. 21. Waiver of Right to Jury Trial. Guarantor and Lender hereby knowingly, voluntarily, intentionally, and irrevocable waive, to the fullest extent permitted by applicable Law, the right either of them may have to a Trial by Jury in respect to any litigation, whether in contract or tort, at law or in equity, based hereon or arising out of, under or in connection with this Guaranty and any other document or instrument contemplated to be executed in conjunction with this Guaranty, or any course of conduct, course of dealing, statements (whether verbal or written) or actions of any party hereto. This provision is a material inducement for Lender entering into or accepting this Guaranty. Further Guarantor hereby certifies that no representative or agent of Lender, nor Lender's Counsel, has represented, expressly or otherwise, that Lender would not, in the event of such litigation, seek to enforce this Waiver of Right to Jury Trial Provision. By Execution of this Guaranty, the undersigned hereby represents that the undersigned is represented by competent counsel who has fully and completely advised the undersigned of the meaning and ramifications of the waiver of the right to a trial by Jury. The Undersigned Guarantor has read, understands and agrees to the provisions of this Guaranty and has executed the same voluntarily, with full authority and with the intent to be legally bound by its terms, conditions and obligations this day of Apri12005, as is evidenced by their execution hereto. Town of Pulaski, Virginia By: Title: John J. Hawley, Town Manager