EXHIBIT 10.2
[Fleet Logo] Fleet Bank
January 1, 1997
Pam Kaplan
Manager, Corporate Tax and Treasury Services
Kronos Inc.
300 Billerica Road
Chelmsford, MA 01824
Dear Pam:
Fleet National Bank (the "Bank") is pleased to offer an informal credit facility
effective January 1, 1997 to Kronos Incorporated ("Kronos") for aggregate
advances not to exceed $3,000,000. This facility must not be construed as a
binding commitment to lend, but rather an indication of our willingness to
provide funds on an as offered basis. As such, it may be withdrawn by the Bank
at any time. This letter agreement supersedes the Loan Agreement between Kronos
Incorporated and Fleet Bank of Massachusetts, N.A. and the First Amendment to
Loan Agreement dated January 24, 1995, collectively the ("Loan Documents"). The
referenced line of credit facility in the Loan Documents will be canceled as of
the effective date of this facility.
Advances hereunder will be made only if in the opinion of the Bank, in its sole
discretion, there has been no material adverse change of circumstances in the
condition of Kronos, financial or otherwise, and if there exists no default
under any loan documentation executed by you. Advances shall be payable on
demand, and shall bear interest at your option of either the "Prime Rate or
Libor + 1.75%. The term "Prime Rate" as used herein shall mean the rate of
interest announced by Bank from time to time at its Boston offices as its Prime
Rate, the term Libor Rate shall mean the rate offered to the Bank by banks in
the London interbank market. Prepayment penalties will apply only if Kronos
elects to borrow at Libor + 1.75% and, only if Kronos does not give the Bank
thirty days written notice of its intent to repay. Interest and fees are
calculated on the basis of a 360-day year and actual days elapsed.
Please indicate your acceptance of this credit facility by signing below and
returning one copy to my attention.
Sincerely,
/s/ Ann M. Dillon
Ann M. Dillon
Vice President
ACCEPTED BY:
Kronos Incorporated
/s/ Paul Lacy
Name
V.P. Finance and Administration
Title
February 6, 1997
Date
cc: Paul A. Lacy
[Fleet Bank Logo] Commercial Promissory Note
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______, Massachusetts ____________, 19__
FOR VALUE RECEIVED, I, the undersigned, promise to pay to the order of
Fleet Bank of Massachusetts, National Association (with any subsequent holder
referred to in this note as "you") at any of your offices, the sum of Three
Million and 00/100 DOLLARS ($3,000,000.00) with interest in accordance with the
provisions below which are marked.
INTEREST RATE
I will pay interest on the unpaid principal balance of this Note as follows, but
in no event will interest exceed the maximum rate permitted by law: X FLOATING
RATE. At the aggregate of the Bank's Prime Rate as the Bank announces it from
time to time, or Libor plus 1.75% percent
per annum. Changes in the Bank's Prime Rate as the Bank announces it from
time to time are to take effect, for the purposes of the determination of
interest on this Note, when made effective generally to loans by the Bank.
_ FIXED RATE. At the rate of _______ percent per annum.
_ DISCOUNT. Interest to maturity has been deducted from the proceeds of this
Note. Interest at the rate of __________ percent per annum shall be paid on
any amount not paid when due hereunder until that amount and any such
interest are so paid.
INTEREST PAYMENTS
I will pay interest at the above rate as follows:
X PERIODICALLY. Monthly/Quarterly/Monthly, in arrears, with the first such
payment due on the _____ day of _________, 19___, and each subsequent payment
due on the corresponding day of each calendar month/calendar
quarter/_______________ thereafter.
_ AT MATURITY. At the maturity of this Note.
_ INTEREST INCLUDED IN REPAYMENTS. Interest is included in the payment(s) to be
made pursuant to the Repayment Provisions below.
REPAYMENT PROVISIONS
In addition to any interest payments to be made as indicated above, I will pay
you the amount stated above as follows:
X ON DEMAND. On demand by you.
_ PAYMENTS TO BE MADE UNTIL DEMAND. On demand by you, with payments of
$____________ each to be made monthly unless and until such demand is made.
The first such payments shall be due on the ______ day of __________, 19____
(if you have not made demand before then) and unless and until you make
demand, each subsequent payment shall be due on the corresponding day of each
month thereafter.
_ TIME. ______________ days after the date hereof on _______________, 19____.
_ INSTALLMENTS. In __________ consecutive monthly installments, of which each
but the last shall be $________ and the final of which shall be equal to the
then unpaid principal balance of this Note plus all accrued and unpaid
interest thereon. The first such monthly installment shall be due on the
______ day of __________, 19____ and each subsequent installment shall be due
on the corresponding day of each month thereafter, with the balance of all
principal and interest due on ____________, 19____.
PREPAYMENT. I will be entitled to prepay this note as follows: Prepayment
penalties will apply only if Kronos elects to borrow at Libor + 1.75% and, only
if Kronos does not give the Bank thirty days written notice of its intent to
repay.
LATE CHARGES. Upon default for more than fifteen (15) days in the making of any
payment of principal or interest on this Note. I will pay you, upon demand, in
addition to all other amounts payable hereunder, a late charge equal to three
percent (3%) of the payment due, but in no event are such charges to exceed the
maximum permitted by law.
APPLICATION OF PAYMENTS. Any payments you receive from me will be applied first
to any accrued and unpaid interest and then to the unpaid principal balance of
this Note. If any payment under this Note becomes due and payable on the day
upon which your office is legally closed to business, the due date shall be
extended to the next succeeding business day and interest shall be payable
during such extension at the rate stated above.
EACH BORROWER AND ENDORSER LIABLE. If more than one borrower has signed below,
each of us has made all of the promises contained in this Note, and we are
jointly and severally liable for all obligations on this Note. If one or more
endorser has signed below, each endorser agrees to all terms of this Note,
including without limitation the provisions relating to Security.
This Note is subject to the terms, provisions and conditions set forth on
the reverse side of this page. Signed as an instrument under seal on the date
stated above.
BORROWER(S)
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Name of Borrower
By: _____________________________________________
Name Title
By: _____________________________________________
Name Title
Address: _________________________________________
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By: _____________________________________________
Name Title
Address: _________________________________________
(ENDORSER(S):
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EVENTS OF DEFAULT. Upon the occurrence of any one or more of the following
Events of Default, the entire unpaid principal balance of this Note and all
unpaid accrued interest hereunder shall become immediately due and payable at
your option and without notice or demand. In addition, at your option and
without notice or demand, the occurrence of any such Event of Default shall also
constitute a default under all agreements between you and me as well as of all
instruments and papers that I have given to you. Events of Default are:
(a) my failure to pay when due (or upon demand, if payable on demand) any
amount due on this Note or any other amount I owe you; (b) my failure promptly,
punctually, and faithfully to perform any other obligation or discharge any
liability of mine to you; (c) your determination that any representation or
warranty I made to you in any document, instrument, agreement or paper was not
true or accurate when given; (d) the occurrence of any event of default under
any agreement between you and me or under any instrument or paper I have given
to you notwithstanding that you may not have exercised your rights upon default
under any such other agreement, instrument or paper; (e) any act by, against, or
relating to me or my property or assets, which act constitutes the application
for, consent to, or sufferance of, the appointment of a receiver, trustee, or
other person, pursuant to court action or otherwise over all or any part of my
property, the granting of any trust mortgage or execution of an assignment for
the benefit of my creditors or the occurrence of any other voluntary or
involuntary liquidation or extension of debt agreement for me; my written
admission of my inability to pay my debts as they mature; the filing of any
complaint, application, or petition by or against me initiating any matter in
which I am or may be granted any relief from my debts pursuant to the Federal
Bankruptcy Code or pursuant to any other insolvency statute or procedure; my
offering by or entering into any composition, extension, or any other
arrangement seeking relief or extension for my debts or any other judicial or
non-judicial proceeding or agreement by, against, or including me which seeks or
intends to accomplish a reorganization or arrangement with creditors; (f) the
imposition of any lien upon my assets or the entry of any judgment against me,
which lien is not discharged, or judgment appealed from or satisfied, within
fifteen (15) days after its imposition or entry; (g) any material adverse change
in my assets, liabilities, property, business or condition, financial or
otherwise; (h) the occurrence of any event or circumstance with respect to me
such that you deem yourself to be insecure; (i) my death, termination of
existence, dissolution, winding up, or liquidation; (j) the occurrence of any of
the foregoing Events of Default with respect to any guarantor or endorser to you
of my liabilities to you, as if such guarantor or endorser were a borrower who
signed this Note.
LOAN DOCUMENTS: SECURITY. The following loan documents and security
instruments are incorporated herein by reference with the same force and
effect as if set forth herein in full:
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The execution, endorsement or guaranty of this Note constitutes a confirmation
by each person that any security interest listed above which was given to you
before the date hereof shall continue in effect as security for this Note. In
addition to the foregoing, any and all of the deposits or other sums at any time
credited by or due from you to me or to any endorser or guarantor of this Note,
and any cash, securities, instruments, or other property of mine or of such
endorser or guarantor in your possession, whether for safekeeping, or otherwise,
shall at all times constitute security for this note, and for any and all of my
liabilities to you including, without limitation, the liability evidenced
hereby, and may be applied or set off by you against such liabilities at any
time whether or not such liabilities are then due and whether or not other
collateral is available to you.
COSTS AND EXPENSES. I and each endorser and guarantor of this Note, will
pay all costs and expenses, including, without limitation, reasonable attorneys'
fees and all expenses and disbursements of counsel, in connection with the
protection or enforcement of any of your rights against me or any such endorser
and guarantor and against any collateral given to you to secure this Note or any
other of my liabilities or of such endorser and guarantor to you (whether or not
suit is instituted by or against you).
ASSIGNABILITY BY YOU. You may assign and transfer this note to any person,
firm or corporation and deliver to the assignee any collateral or security
interest you hold in connection with this Note. In the event of such assignment,
you will have no further responsibility or liability with respect to such
collateral or security interest, and the terms of this Note and any related
documents shall inure to the benefit of your assignee and its successors. This
Note shall be binding upon me and each endorser and guarantor hereof and upon my
and their respective heirs, successors, assigns, and representatives, and shall
inure to the benefit of you and your successors and endorsees.
SEVERABILITY. If any provision of this Note is deemed by any court having
jurisdiction thereof to be invalid or unenforceable, the other provisions of
this Note shall remain in full force and effect. If any provision of this note
is deemed by any such court to be unenforceable because such provision is too
broad in scope, such provision shall be construed to be limited in scope to the
extent such court shall deem necessary to make it enforceable. If any provision
is deemed inapplicable by any such court to any person or circumstances, it
shall nevertheless be construed to apply to all other persons and circumstances.
WAIVER. No delay or omission by you in exercising or enforcing any of your
powers, rights, privileges, remedies, or discretions hereunder shall operate as
a waiver thereof on that occasion nor on any other occasion. No waiver of any
default hereunder shall operate as a waiver of any other default hereunder, nor
as a continuing waiver.
ENDORSEMENT. Each endorser, jointly and severally if more than one,
unconditionally guarantees prompt payment when due, by acceleration or
otherwise, of this Note, regardless of its genuineness, validity, regularity or
enforceability and waives any right to require you to proceed against the
Borrower or any collateral which you might have been granted to secure any
endorser's liabilities under this Note.
PRESENTMENT, EXTENSION. I and each endorser and guarantor of this Note
respectively waive presentment, demand, notices, and protest, and also waive any
delay on the part of the holder hereof. Each assents to any extension or other
indulgence (including, without limitation, the release of any other party to
this Note or the release or substitution of collateral) which you permit me or
any such endorser or guarantor with respect to this Note or any collateral given
to secure this Note and any other liability of mine or such endorser or
guarantor to you.
MISCELLANEOUS. My liabilities and those of any endorser or guarantor of
this Note are joint and several; provided, however, your release of me or any
endorser or guarantor shall not release any other person obligated on account of
this Note. Each reference in this Note to me, any endorser, and any guarantor,
is to such person individually and also to all such persons jointly. No person
obligated on account of this Note may seek contribution from any other person
also obligated unless and until all liabilities to you of the person from whom
contribution is sought have been satisfied in full.
I and each endorser and guarantor of this Note authorize you to complete
this Note if delivered in incomplete form, in any respect.
This Note is delivered to you at one of your offices in Massachusetts and
shall be governed by the laws of the Commonwealth of Massachusetts. I and each
endorser and guarantor of this Note submit to the jurisdiction of the courts of
the Commonwealth of Massachusetts for all purposes with respect to this Note,
any collateral given to secure their respective liabilities to you or their
respective liabilities to you or their respective relationships with you.