Document:

exhibit1016.htm

Exhibit 10.16

NON-RECOURSE

LOAN PARTICIPATION AGREEMENT

	
Originating Bank

	
Participant

	
First Southern National Bank

	
Universal Guaranty Life Insurance Company

	
BORROWER

	
 

	
Interest

Rate

	
Principal Amount/Credit Limit

	
Funding/

Agreement

Date

	
Maturity

 Date

	
Customer Number

	
Loan

 Number

	  	  	  	  	  	  

TERMS AND CONDITIONS

	
1.

	
Sale of Loan Participation   Interest:      Originating   Bank   hereby   sells,   assigns,   transfers  and  delivers  to  the  Participant, a $___________________________ interest in the Originating Bank's ownership rights in and to the indebtedness, promissory note or notes, collateral security and all documents relating to the loan or loans described above (hereinafter, one or more, referred to as the 'Loan").

	  	  
	
2.

	
Ownership of Loan Participation Interest: The parties hereto agree that the Participant shall be considered for all purposes as the legal and equitable owner of the above interest in the indebtedness, promissory note or notes, collateral security and all documents relating to the Loan, together with all of the rights, privileges and remedies applicable thereto.

 

	
THIS LOAN PARTICIPATION CONSTITUTES A SALE OF A PERCENTAGE OWNERSHIP INTEREST IN THE ABOVE REFERENCED INDEBTEDNESS, NOTE OR NOTES, COLLATERAL SECURITY AND OTHER LOAN DOCUMENTS AND SHALL IN NO WAY BE CONSTRUED AS AN EXTENSION OF CREDIT BY THE PARTICIPANT TO THE ORIGINATING BANK.

 

	
3.

	
Agent for Collection and Servicing:

 

	  	
(a)

	
The Originating Bank shall act as the disclosed agent of the Participant in connection with receipt and collection of the Participant's ownership interest in the Loan and in payments to be made thereunder.  The Originating Bank shall additionally act as the disclosed agent of the Participant in connection with the continued servicing of the Loan.

	  	
(b)

	
The Originating Bank shall exercise the same degree of care and discretion in continuing to service the Loan and in collecting payments thereunder, as the Originating Bank would ordinarily take in servicing the Loan and in collecting payments thereunder solely for its own account.

	  	
(c)

	
The Originating Bank may not, however, without the prior consent and concurrence of the Participant; (i) make or consent to any amendments in the terms and conditions of the Loan, or the terms of the note or notes evidencing the Loan, or in any security agreement or instrument securing the Loan; (ii) waive or release any claim against any Borrower and/or against any co-maker, guarantor or endorser under the Loan; (iii) make or consent to any release, substitution or exchange of collateral; (iv) accelerate payment under the Loan and/or under any note or notes evidencing the Loan; (v) commence any type of collection proceeding against the Borrower and/or against any co-maker, guarantor or endorser under the Loan; and/or (vi) seize, sell, transfer, assign, foreclose or attempt to exercise against any collateral securing the Loan.

	  	
(d)

	
The Participant may terminate the agency status of the Originating Bank as provided in Section 4 of this Agreement.

	  	  	  
	
4.

	
Termination of Agency Status:

 

	  	
(a)

	
The Originating Bank's agency status under Section 3 above shall terminate at the election of the Participant upon: (i) the insolvency, closing or liquidation of the Originating Bank; (ii) if, within the opinion of the Participant, the Originating Bank should fail to comply with its fiduciary and/or other obligations as provided under this Agreement; or (iii) if the Originating Bank and the Participant are unable to mutually agree as to a course of action to be taken with regard to collection of the Loan following the Borrower's default or as to any matter listed in Section 3(C) of this Agreement.

	  	
(b)

	
Upon termination of the Originating Bank's agency status, the Participant shall have the right to immediately notify the Borrower, directing the Borrower to forward principal and interest payments under the Loan directly to the Participant, in sufficient amounts to satisfy the Participant's then percentage ownership interest in the Loan.  The Originating Bank shall join in this notice to the Borrower upon request by the Participant.

	  	
(c)

	
Unless otherwise provided herein, the remaining terms and conditions of this Agreement shall survive the termination of the Originating Bank agency status.  Such remaining terms and conditions of this Agreement shall continue to apply until such time as the Loan is paid in full or the Participant's ownership interest in the Loan is repurchased by the Originating Bank as provided in Section 11 below.

	  	  	  
	
5.

	
Representations and Warranties by Originating Bank:

 

	  	
(a)

	
The Originating Bank makes the following representations and warranties to the Participant: (i) the Originating Bank has provided the Participant with copies of all relevant credit and other information currently in the possession of the Originating Bank, that were used by the Originating Bank as a basis of and for its decision to make the Loan to the Borrower; (ii) the Originating Bank has additionally provided the Participant with copies of the Loan documents that were executed (and/or are to be executed) by the Borrower as well as by other co-makers, guarantors and endorsers under the Loan; (iii) where the Loan is presently in existence, there are no events of default under the Loan and/or under the Loan documents, the Loan has not been classified on the books of the Originating Bank, the Loan is presently on accrual status; and the terms of the Loan have not previously been renegotiated as a result of a prior deterioration in the Borrower's financial condition.

	  	
(b)

	
The Originating Bank makes no representation or warranties, whether expressed or implied, to the Participant, as to the collectibility of the Loan, the continued solvency of the Borrower, or as to the existence, sufficiency or value of the collateral securing the Loan.

	  	
(c)

	
The Originating Bank makes no representations or warranties, whether expressed or implied, to the Participant, as to the validity and enforceability of the Loan documents, other than that: (i) the Loan documents were validly executed by the Borrower, as well as, to the degree applicable, by the co-makers, guarantors and/or endorsers under the Loan; (ii) to the extent required under applicable law, the security agreements under the Loan were (and/or will be) properly recorded in order to result in the valid perfection of a security interest on the collateral subject to such agreements; and (iii) to the extent required under applicable law, the Originating Bank has taken (and/or will continue to take) whatever additional actions may be necessary and proper to validly perfect and maintain a security interest on the collateral securing the Loan.

	  	  	  
	
6.

	
Representations and Warranties by Participant: The Participant represents and warrants to the Originating Bank that the Participant based its decision to purchase a participation ownership interest in the Loan solely upon the Participant's own independent evaluation of the Loan, the Borrower's creditworthiness and the existence, value and lien status of collateral securing the Loan.

 

	
7.

	
Additional Obligations of Originating Bank:

 

	  	
(a)

	
The Originating Bank shall promptly notify the Participant should the Originating Bank learn or have knowledge of the following: (i) any change in the financial condition of the Borrower, or any co-maker, guarantor or endorser under the Loan, which may have a material adverse effect upon continuation of the payments under the Loan or the Loan's ultimate collectibility; (ii) any material change in the value of collateral securing the Loan; (iii) any change in lien status as affecting the secured collateral; (iv) any request by the Borrower, or by any co-maker, guarantor or endorser under the Loan, for any change in the terms and conditions of the Loan, or in the terms of any note or notes evidencing the Loan, or in any security agreement or instrument securing the Loan; (v) any request by the Borrower, or by any co-maker, guarantor or surety under the Loan, or the release, substitution or exchange of any collateral securing the Loan; (vi) any request of the Borrower, or by any co-maker, guarantor or endorser under the Loan, for the release of any personal obligations of any such party under the Loan; (vii) any request by the Originating Bank for any change in the terms and conditions of the Loan, or in the terms of any note or notes evidencing the Loan, or in any security agreement or instrument securing the Loan; (viii) any request by the Originating Bank for an increase in and/or substitution or exchange of collateral securing the Loan; (ix) any failure by the Borrower to pay principal and/or interest payments under the Loan when due; and/or (x) the occurrence of any other event, which with the passage of time and/or failure to cure, would constitute an event of default under the Loan or under any note or notes evidencing the Loan, or under any security agreement or instrument securing the Loan.

	  	
(b)

	
As long as the Participant continues to have an ownership interest in the Loan, the Originating Bank agrees to regularly provide the Participant with complete and current credit related and other information concerning the Borrower, the Loan and the collateral securing the Loan including without limitations, copies of: (i) current financial statements of the Borrower, as well as of all co-makers, guarantors and sureties under the Loan; (ii) any officer's certificates, financial and other statements and information submitted by the Borrower to the Originating Bank in connection with the Loan; (iii) the records of the Originating Bank reflecting the amounts and dates of receipt of principal and interest payments under the Loan; (iv) any information and/or documents in possession of the Originating Bank bearing upon the continuing creditworthiness of the Borrower.

	
8.

	
Application of the Payments (only the checked provision applies):

 

	  	
(a)

	
The Originating Bank and the Participant shall each share in all principal and interest payments and other collections under the Loan in proportion to their respective percentage ownership interests in the Loan (with appropriate provisions made for differences in interest rates between the Originating Bank and the Participant).

 

	  	
(b)

	
All principal payments under the Loan shall be first applied towards payment of the Participant's ownership interest in the Loan, until such time as the Participant's ownership interest is paid in full.  However, if there should be an event of default under the Loan (as provided under the Loan documents), the Originating Bank and the Participant shall thereafter each share in subsequent principal and interest payments and/or collections in proportion to their respective percentage ownership interests in the Loan as existing at time of default (with appropriate provisions made for differences in interest rates between the Originating Bank and the Participant).

	
Principal and interest payments and/or other amounts collected by the Originating Bank under the Loan shall be held in trust for the benefit of the Participant, until such funds, representing the Participant's ownership interest in such payments under (a) or (b) above, are actually paid to and received by the Participant.

	
9.

	
Additional Loans by Originating Bank:

 

	  	
(a)

	
The Participant recognizes and agrees that the Originating Bank may have other existing loans and in the future may make additional loans to the Borrower and/or to other co-makers, guarantors, and sureties under the Loan, which other and/or additional loans may not be participated to the Participant.

	  	
(b)

	
The Participant further recognizes and agrees that the Originating Bank shall have no obligation to attempt to collect payments under the Loan in preference and priority over the collection and/or enforcement of any other and/or additional loans by the Originating Bank as referenced in (a) above.

	  	
(c)

	
The Originating Bank, however, agrees that the proceeds of all collateral directly securing repayment of the Loan shall be applied first to the payment of the Loan as provided in Section 8 above.  Any excess proceeds may be applied by the Originating Bank to the payment of any other and/or additional loans then owing to the Originating Bank, that may be indirectly secured by such collateral as a result of the inclusion of "cross-collateralization" provisions in the security agreements executed in connection with the Loan in favor of the Originating Bank.

	  	
(d)

	
The parties hereto further agree that the Participant shall have no interest in any other property of the Borrower or any co-maker, guarantor or endorser, taken as security for any other and/or additional loan or loans made by the Originating Bank, or acquired by the Originating Bank or in any property now or hereafter in the possession or control of the Originating Bank, which other property may indirectly secure repayment of the Loan by reason of "cross-collateralization"; except that, if any such other property or the proceeds thereof is applied to the reduction of the Loan, then the Participant shall be entitled to share in such an application of payment or payments as provided in Section 8 of this agreement.

	
10.

	
Default:

 

	  	
(a)

	
Upon the occurrence of any event of default under the Loan, the Originating Bank and the Participant shall consult upon themselves as to a mutually agreed upon course of action to pursue in order to collect the amounts then owed under the Loan.

	  	
(b)

	
If the Participant and the Originating Bank cannot mutually agree upon what course of action to take, or if the Originating Bank should fail for any reason to take such mutually agreed upon action or actions to the satisfaction of the Participant, the parties hereto unconditionally agree that either the Originating Bank or the Participant may then elect, upon written notice to the other, to accelerate payment under the Loan and/or under any note or notes evidencing the Loan, and to institute such legal proceedings as are necessary and appropriate, within the sole opinion of the instituting bank, to collect the indebtedness then due under the Loan, to enforce the security therefore, and to protect and preserve the respective rights and interests of the parties.  To that end, the bank instituting such proceedings shall make the other bank a party thereto and each bank shall bear the costs and expenses of such proceedings in proportion to their respective percentage interest in the loan existing at the time of the default.

	  	
(c)

	
In the event that the Participant elects to accelerate payment of the Loan and to institute legal proceedings as provided in (b) above, or upon the Originating Bank's failure, insolvency and/or closing: (i) the Originating Bank unconditionally agrees to immediately forward the original Loan documents (including, without limitation, the original of the Borrower's note or notes evidencing the Loan and all security agreements and instruments therefore) to the Participant, together with such other documents, files and records as may be necessary, within the opinion of the Participant and its counsel, to permit the Participant to institute appropriate collection and/or foreclosure proceedings under the Loan and/or against the collateral securing the Loan; (ii) the Originating Bank shall further turn over any secured collateral in its possession to the Participant; (iii) the Originating Bank additionally agrees to join in any demand letter or other communications forwarded by the Participant to the Borrower and/or to any co-makers, guarantors or endorsers under the Loan; (iv) the Originating Bank further agrees to execute such additional documents in favor of the Participant as may be deemed to be necessary and proper by the Participant and its counsel to permit the Participant to foreclose against collateral securing the Loan under applicable state law procedures.

	
11.

	
Miscellaneous:

 

	  	
(a)

	
The Participant may not sell, pledge, assign, sub-participate or otherwise transfer its percentage ownership interest under the Loan without first obtaining the prior written consent of the Originating Bank, which consent shall not unreasonably be withheld.

	  	
(b)

	
This Agreement shall be governed and construed under the laws of the State of  Ohio.

	  	
(c)

	
This Agreement shall be binding upon the parties hereto, as well as their respective legal representatives, successors and assigns.

	  	
(d)

	
All notices under this Agreement shall be in writing and mailed to the respective parties at the address given herein.

	  	
(e)

	
Should any provision of this Agreement be deemed invalid or unenforceable as contrary to applicable law, the parties hereto agree that such provision shall automatically be deemed to be reformed as to be consistent with applicable law.

	  	  	  
	
12.

	
Other Terms and Conditions:

 

	  	
(a)

	
Participant will pay to Originating Bank an annual servicing fee  of .25%.

 

 

 

	
ORIGINATING BANK:

	  	
PARTICIPANT:

	  	  	  
	  
	  
	
First Southern National Bank

	  	
Universal Guaranty Life Insurance Company

	
 

Date

	  	  	
 

Dateex10v3.htm

  

  

  

Exhibit 10.3

NON-STATUTORY STOCK OPTION AGREEMENT

THIS AGREEMENT is entered into and effective as of this __ day of   ____________, ______ (the "Date of Grant"), by and between Aetrium Incorporated (the "Company") and ________________  ("Optionee").

A.           The Company has adopted the Aetrium Incorporated 2003 Stock Incentive Plan (the "Plan") authorizing the Board of Directors of the Company, or a committee as provided for in the Plan (the Board or such a committee to be referred to as the "Committee"), to grant non-statutory stock options to employees and non-employee consultants and independent contractors of the Company and its Subsidiaries (as defined in the Plan).

B.           The Company desires to give the Optionee an inducement to acquire a proprietary interest in the Company and an added incentive to advance the interests of the Company by granting to the Optionee an option to purchase shares of common stock of the Company pursuant to the Plan.

Accordingly, the parties agree as follows:

ARTICLE 1.  GRANT OF OPTION.

The Company hereby grants to the Optionee the right, privilege, and option (the "Option") to purchase _____________ (________) shares (the "Option Shares") of the Company's common stock, $.001 par value (the "Common Stock"), according to the terms and subject to the conditions hereinafter set forth and as set forth in the Plan.  The Option is not intended to be an "incentive stock option," as that term is used in Section 422 of the Internal Revenue Code of 1986, as amended (the "Code").

ARTICLE 2.  OPTION EXERCISE PRICE.

The per share price to be paid by Optionee in the event of an exercise of the Option will be $_________.

ARTICLE 3.  DURATION OF OPTION AND TIME OF EXERCISE

3.1           Initial Period of Exercisability.  The Option will become exercisable with respect to 1/48th of the Option Shares on __________, _______ and on the ____   day of each month thereafter until the Option becomes exercisable in full.  The Option may be exercised in whole or in part (but only to the extent it is then exercisable) at any time during the Option term, but in no event will this Option be exercisable after, and this Option will become void and expire as to all unexercised Option Shares at, 5:00 p.m.  (St. Paul, Minnesota time) on _________, _______ (the "Time of Termination").

  

1

  

3.2           Termination of Employment or Other Service.

(a)           In the event that the Optionee's employment or other service with the Company and all Subsidiaries is terminated by reason of the Optionee's death or Disability (as defined in the Plan), this Option will terminate and may no longer be exercised on the earlier of the Time of Termination or one year after such termination of employment or other service.

(b)           In the event the Optionee's employment or other service with the Company and all Subsidiaries is terminated for "cause" (as defined in the Plan), all rights of the Optionee under the Plan and this Agreement will immediately terminate without notice of any kind, and this Option will no longer be exercisable.

(c)           In the event the Optionee's employment or other service with the Company and all its Subsidiaries is terminated by reason of Retirement (as defined in the Plan) or for any other reason other than death, Disability or "cause," this Option will terminate and may no longer be exercised on the earlier of the Time of Termination or three months after such termination of employment or other service.

(d)           To the extent this Option is not vested at the time Optionee's employment or other service with the Company and all Subsidiaries is terminated, it will not vest thereafter or as a result thereof.

3.3           Change in Control.

(a)           If any events constituting a Change in Control (as defined in Section 13.1 of the Plan) of the Company occur, then, if approved by the Committee in its sole discretion, this Option will become immediately exercisable in full and will remain exercisable until the Time of Termination, regardless of whether the Optionee remains in the employ or service of the Company or any Subsidiary.  In addition, if a Change in Control of the Company occurs, the Committee, in its sole discretion and without the consent of the Optionee, may determine that the Optionee will receive, with respect to some or all of the Option Shares, as of the effective date of any such Change in Control of the Company, cash in an amount equal to the excess of the Fair Market Value (as defined in the Plan) of such Option Shares immediately prior to the effective date of such Change in Control of the Company over the option exercise price per share of this Option.

(b)           Notwithstanding anything in this Section 3.3 to the contrary, if, with respect to the Optionee, acceleration of the vesting of this Option or the payment of cash in exchange for all or part of this Option as provided above (which acceleration or payment could be deemed a "payment" within the meaning of Section 280G(b)(2) of the Code), together with any other payments which the Optionee has the right to receive from the Company or any corporation which is a member of an "affiliated group" (as defined in Section 1504(a) of the Code without regard to Section 1504(b) of the Code) of which the Company is a member, would constitute a "parachute payment" (as

  

2

  

defined in Section 280G(b)(2) of the Code), the payments to the Optionee as set forth herein will be reduced to the largest amount as will result in no portion of such payments being subject to the excise tax imposed by Section 4999 of the Code; provided, however, that if the Optionee is subject to a separate agreement with the Company or a Subsidiary that specifically provides that payments attributable to one or more forms of employee stock incentives or to payments made in lieu of employee stock incentives will not reduce any other payments under such agreement, even if it would constitute an excess parachute payment, then the limitations of this Section 3.3(b) will, to that extent, not apply.

ARTICLE 4.  MANNER OF OPTION EXERCISE.

4.1           Notice.  This Option may be exercised by the Optionee in whole or in part from time to time, subject to the conditions contained in the Plan and in this Agreement, by delivery, in person, by facsimile or electronic transmission or through the mail, to the Company at its principal executive office in North St. Paul, Minnesota (Attention: Chief Financial Officer), of a written notice of exercise.  Such notice will be in a form satisfactory to the Committee, will identify the Option, will specify the number of Option Shares with respect to which the Option is being exercised, and will be signed by the person or persons so exercising the Option.  Such notice will be accompanied by payment in full of the total purchase price of the Option Shares purchased.  In the event that the Option is being exercised, as provided by the Plan and Section 5 below, by any person or persons other than the Optionee, the notice will be accompanied by appropriate proof of right of such person or persons to exercise the Option.  As soon as practicable after the effective exercise of the Option, the Optionee will be recorded on the stock transfer books of the Company as the owner of the Option Shares purchased, and the Company will deliver to the Optionee one or more duly issued stock certificates evidencing such ownership.

4.2           Payment.  At the time of exercise of this Option, the Optionee will pay the total purchase price of the Option Shares to be purchased entirely in cash (including a check, bank draft or money order, payable to the order of the Company); provided, however, that the Committee, in its sole discretion, may allow such payment to be made, in whole or in part, by tender of a Broker Exercise Notice, Previously Acquired Shares or by a combination of such methods.  For purposes of this Agreement, the terms "Broker Exercise Notice" and "Previously Acquired Shares" will have the meanings set forth in the Plan.  In the event the Optionee is permitted to pay the total purchase price of this Option in whole or in part with Previously Acquired Shares, the value of such shares will be equal to their Fair Market Value on the date of exercise of this Option.

ARTICLE 5.  NONTRANSFERABILITY.

This Option may not be transferred by the Optionee, either voluntarily or involuntarily, or subjected to any lien, directly or indirectly, by operation of law or otherwise, except pursuant to testamentary will or the laws of descent and distribution

  

3

  

or as otherwise expressly permitted in the Plan.  Any attempt to transfer or encumber this Option other than in accordance with this Agreement and the Plan will be null and void and will void this Option.

ARTICLE 6.  LIMITATION OF LIABILITY.

Nothing in this Agreement will be construed to (a) limit in any way the right of the Company to terminate the employment or service of the Optionee at any time, or (b) be evidence of any agreement or understanding, express or implied, that the Company will retain the Optionee in any particular position, at any particular rate of compensation or for any particular period of time.

ARTICLE 7.  WITHHOLDING TAXES.

The Company is entitled to (a) withhold and deduct from future wages of the Optionee (or from other amounts which may be due and owing to the Optionee from the Company), or make other arrangements for the collection of, all legally required amounts necessary to satisfy any federal, state or local withholding and employment-related tax requirements attributable to the grant or exercise of this Option or otherwise incurred with respect to this Option, or (b) require the Optionee promptly to remit the amount of such withholding to the Company before acting on the Optionee's notice of exercise of this Option.  In the event that the Company is unable to withhold such amounts, for whatever reason, the Optionee hereby agrees to pay to the Company an amount equal to the amount the Company would otherwise be required to withhold under federal, state or local law.

ARTICLE 8.  ADJUSTMENTS.

In the event of any reorganization, merger, consolidation, recapitalization, liquidation, reclassification, stock dividend, stock split, combination of shares, rights offering, divestiture or extraordinary dividend (including a spin-off), or any other change in the corporate structure or shares of the Company, the Committee (or, if the Company is not the surviving corporation in any such transaction, the board of directors of the surviving corporation), in order to prevent dilution or enlargement of the rights of the Optionee, will make appropriate adjustment (which determination will be conclusive) as to the number, kind and exercise price of securities subject to this Option.

ARTICLE 9.  SUBJECT TO PLAN.

The Option and the Option Shares granted and issued pursuant to this Agreement have been granted and issued under, and are subject to the terms of, the Plan.  The terms of the Plan are incorporated by reference in this Agreement in their entirety, and the Optionee, by execution of this Agreement, acknowledges having received a copy of the Plan.  The provisions of this Agreement will be interpreted as to

  

4

  

be consistent with the Plan, and any ambiguities in this Agreement will be interpreted by reference to the Plan.  In the event that any provision of this Agreement is inconsistent with the terms of the Plan, the terms of the Plan will prevail.

ARTICLE 10.  MISCELLANEOUS.

10.1           Binding Effect.  This Agreement will be binding upon the heirs, executors, administrators and successors of the parties to this Agreement.

10.2           Governing Law.  This Agreement and all rights and obligations under this Agreement will be construed in accordance with the Plan and governed by the laws of the State of Minnesota.

10.3           Entire Agreement.  This Agreement and the Plan set forth the entire agreement and understanding of the parties to this Agreement with respect to the grant and exercise of this Option and the administration of the Plan and supersede all prior agreements, arrangements, plans and understandings relating to the grant and exercise of this Option and the administration of the Plan.

10.4           Amendment and Waiver.  Other than as provided in the Plan, this Agreement may be amended, waived, modified or canceled only by a written instrument executed by the parties hereto or, in the case of a waiver, by the party waiving compliance.

The parties to this Agreement have executed this Agreement effective the day and year first above written.

                     AETRIUM INCORPORATED

                     By____________________________________

                      Its___________________________________

 

By execution of this Agreement,                                                                                           OPTIONEE

the Optionee acknowledges having

received a copy of the Plan.                                                                                             _____________________________________

                                                  (Signature)

                                            _____________________________________

                                                                             (Name)

  

5

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00187-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00187-of-00352.parquet"}]]