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Intergraph experienced cash-flow problems in its initial months
of operation.
On the Overdraft Agreement, Nihon Intergraph was reflected
as the debtor, and Citibank Tokyo was reflected as the creditor.
Intergraph representatives did not sign, and Intergraph was not
reflected as a debtor, as a co-obligor, as a guarantor, nor in
any other capacity, on the Overdraft Agreement.
Due to Nihon Intergraph's affiliation with Intergraph and
Intergraph’s longstanding banking relationship with Citicorp, the
interest rate that was to be charged Nihon Intergraph by Citibank
Tokyo on the amount overdrawn on the checking account (overdraft
amount) reflected the best available short-term interest rate.
Interest that accrued on the overdraft amount was charged
directly to Nihon Intergraph's checking account, thereby
increasing the overdraft amount.
The overdraft amount was payable by Nihon Intergraph in yen
on demand from Citibank Tokyo.
On June 28, 1985 (with regard to the overdraft amount and
any other loans, advances, and overdrafts owed by Nihon
Intergraph to Citibank Tokyo), Intergraph entered into a guaranty
agreement (Guaranty Agreement) with Citibank, N.A., under which
Intergraph, among other things, guaranteed to repay to Citibank,
N.A., on demand the overdraft amount. The Guaranty Agreement was
similar to agreements that Intergraph entered into on behalf of
its other subsidiaries.
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Last modified: May 25, 2011