[Logo]BANK OF AMERICA NT & SA BUSINESS LOAN AGREEMENT
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This Agreement dated as of August 21, 1997 is between Bank of America NT &
SA (the "Bank") and Clarement Technology Group, Inc. (the "Borrower").
1. FACILITY NO. 1: LINE OF CREDIT AMOUNT AND TERMS
1.1 LINE OF CREDIT AMOUNT.
(a) During the availability period described below, the Bank will provide
a line of credit to the Borrower. The amount of the line of credit (the
"Facility 1 Commitment") is Two Million Dollars ($2,000,000).
(b) This is a revolving line of credit with a within line facility for a
standby letters of credit. During the availability period, the Borrower
may repay principal amounts and reborrow them.
(c) The Borrower agrees not to permit the outstanding principal balance of
the line of credit plus the outstanding amounts of any standby letters of
credit to exceed the Facility 1 Commitment.
1.2 AVAILABILITY PERIOD. The line of credit is available between the date
of this Agreement and September 1, 1999 the "Facility 1 Expiration
Date") unless the Borrower is in default.
1.3 INTEREST RATE.
(a) Unless the Borrower elects an optional interest rate as described
below, the interest rate is the Reference Rate plus .25 percentage point.
(b) The Reference Rate is the rate of interest publicly announced from
time to time by Bank as its Reference Rate. The Reference Rate is set
based on various factors, including Bank's costs and desired return,
general economic conditions and other factors, and is used as a reference
point for pricing some loans. The Bank may price loans to its customers
at, above, or below the Reference Rate. Any change in the Reference Rate
shall take effect at the opening of business on the days specified in the
public announcement of a change in the Reference Rate.
1.4 REPAYMENT TERMS.
(a) The Borrower will pay interest on September 1, 1997, and then monthly
thereafter until payment in full of any principal outstanding under this
line of credit.
(b) The Borrower will repay in full all principal and any unpaid interest
or other charges outstanding under this line of credit no later than the
Facility 1 Expiration Date.
1.5 OPTIONAL INTEREST RATES. Instead of the interest rate based on the
Reference Rate, the Borrower may elect to have all or portions of the line of
credit (during the availability period) bear interest at the rate(s)
described below during an interest period agreed to by the Bank and the
Borrower. Each interest rate is a rate per year. Interest will be paid on the
first day of every month and on the last day each interest period. At the end
of any interest period, the interest rate will revert to the rate based on
the Reference Rate, unless the Borrower has designated another optional
interest rate for the portion.
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1.6 OFFSHORE RATE. The Borrower may elect to have all or portions of the
principal balance of the line of credit bear interest at the Offshore Rate
plus 2.0 percentage points.
Designation of an Offshore Rate portion is subject to the following
requirements:
(a) The interest period during which the Offshore Rate will be in effect
will be no shorter than 30 days and no longer than one year. The last day
of the interest period will be determined by the Bank using the practices
of the offshore dollar inter-bank market.
(b) Each Offshore Rate portion will be for an amount not less than One
Hundred Thousand Dollars ($100,000).
(c) The "Offshore Rate" means the interest rate determined by the following
formula, rounded upward to the nearest 1/100 of one percent. (All amounts
in the calculation will be determined by the Bank as of the first day of
the interest period.)
Offshore Rate = Grand Cayman Rate
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(1.00 - Reserve Percentage)
Where,
(i) "Grand Cayman Rate" means the interest rate (rounded upward to
the nearest 1/16th of one percent) at which the Bank's Grand
Cayman, Branch Grand Cayman British West Indies, would offer U.S.
dollar deposits for the applicable interest period to other major
banks in the offshore dollar inter-bank market.
(ii) "Reserve Percentage" means the total of the maximum reserve
percentages for determining the reserves to be maintained by
member banks of the Federal Reserve System for Eurocurrency
Liabilities, as defined in the Federal Reserve Board Regulation
D, rounded upward to the nearest 1/100 of one percent. The
percentage will be expressed as a decimal, and will include,
but not be limited to, marginal, emergency, supplemental, special,
and other reserve percentages.
(d) The Borrower may not elect an Offshore Rate with respect to any portion
of the principal balance of the line of credit which is scheduled to be
repaid before the last day of the applicable interest period.
(e) Any portion of the principal balance of the line of credit already
bearing interest at the Offshore Rate will not be converted to a
different rate during its interest period.
(f) Each prepayment of an Offshore Rate portion, whether voluntary, by
reason of acceleration or otherwise, will be accompanied by the amount
of accrued interest on the amount prepaid, and a prepayment fee equal
to the amount (if any) by which
(i) the additional interest which would have been payable on the
amount prepaid had it not been paid until the last day of the
interest period, exceeds
(ii) the interest which would have been recoverable by the Bank by
placing the amount prepaid on deposit in the offshore dollar
market for a period starting on the date on which it was prepaid
and ending on the last day of the interest period for such
portion.
(g) The Bank will have no obligation to accept an election for an Offshore
Rate portion if any of the following described events has occurred and is
continuing:
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(i) Dollar deposits in the principal amount, and for periods equal
to the interest period, of an Offshore Rate portion are not
available in the offshore Dollar inter-bank market; or
(ii) the Offshore Rate does not accurately reflect the cost of an
Offshore Rate portion.
1.7 LIBOR RATE. The Borrower may elect to have all or portions of the
principal balance of the line of credit bear interest at the LIBOR Rate plus
2.0 percentage points.
Designation of a LIBOR Rate portion is subject to the following requirements:
(a) The interest period during which the LIBOR Rate will be in effect will
be 30, 60, 90, 180 or 365 days. The last day of the interest period
will be determined by the Bank using the practices of the London
inter-bank market.
(b) Each LIBOR Rate portion will be an amount not less than One Hundred
Thousand Dollars ($100,000).
(c) The Borrower shall irrevocably request a LIBOR Rate portion no later
than 9:00 a.m. San Francisco time three (3) banking days before the
commencement of the interest period.
(d) The "LIBOR Rate" means the interest rate determined by the following
formula, rounded upward to the nearest 1/100 of one percent. (All
amounts in the calculation will be determined by the Bank as of the
first day of the interest period.)
LIBOR Rate = London Rate
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(1.00 - Reserve Percentage)
Where,
(i) "London Rate" means the interest rate (rounded upward to the
nearest 1/16th of one percent) at which the Bank of America
NT & SA's London Branch, London, Great Britain, would offer
U.S. dollar deposits for the applicable interest period to other
major banks in the London inter-bank market at approximately
11:00 a.m. London time two (2) banking days before the
commencement of the interest period.
(ii) "Reserve Percentage" means the total of the maximum reserve
percentages for determining the reserves to be maintained by the
member banks of the Federal Reserve System for Eurocurrency
Liabilities, as defined in the Federal Reserve Board Regulation
D, rounded upward to the nearest 1/100 of one percent. The
percentage will be expressed as a decimal, and will include,
but not be limited to, marginal, emergency, supplemental,
special, and other reserve percentages.
(e) The Borrower may not elect a LIBOR Rate with respect to any portion of
the appreciable balance of the line of credit which is scheduled to be
repaid before the last day of the applicable interest period.
(f) Any portion of the principal balance of the line of credit already
bearing interest at the LIBOR Rate will not be converted to a different
rate during its interest period.
(g) Each prepayment of a LIBOR Rate portion, whether voluntary, by reason
of acceleration or otherwise, will be accompanied by the amount of accrued
interest on the amount prepaid, and a prepayment fee equal to the amount
(if any) by which:
(i) the additional interest which would have been payable on the
amount prepaid had it not been paid until the last day of the
interest period, exceeds
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(ii) the interest which would have been recoverable by the Bank by
placing the amount prepaid on deposit in the London inter-bank
market for a period starting on the date on which it was prepaid
and ending on the last day of the interest period for such
portion.
(h) The Bank will have no obligation to accept the election for LIBOR Rate
portion if any of the following described events has occurred and is
continuing:
(i) Dollar deposits in the principal amount, and for periods equal
to the interest period, of a LIBOR Rate portion are not
available in the London inter-bank market; or
(ii) the LIBOR Rate does not accurately reflect the cost of a LIBOR
Rate portion.
1.8 LETTERS OF CREDIT. At the request of the Borrower, between the date of
this Agreement and September 1, 1999, (the "Expiration Date"), the Bank will
issue standby letters of credit with a maximum maturity of one year, up to
365 days beyond the Expiration Date; provided, however, that the maturity
date may be automatically extended each year for an additional year unless
the Bank gives written notice to the contrary.
The amount of outstanding letters of credit, including amounts drawn on
letters of credit and not yet reimbursed, may not exceed at any one time
Seven Hundred Fifty Thousand Dollars ($750,000). The Borrower agrees:
(a) any sum owed to the Bank under a letter of credit may, at the option of
the Bank, be added to the principal amount outstanding under this
Agreement. The amount will bear interest and be due as described elsewhere
in this Agreement.
(b) if there is a default under this Agreement, to immediately prepay and
make the Bank whole for any outstanding letters of credit.
(c) the issuance of any letter of credit and any amendment to a letter of
credit is subject to the Bank's written approval and must be in form and
content satisfactory to the Bank and in favor of a beneficiary acceptable
to the Bank.
(d) to sign the Bank's form Application and Agreement for Standby Letter of
Credit.
(e) to pay any issuance and/or other fees that the Bank notifies the Borrower
will be charged for issuing and processing letters of credit for the
Borrower.
2. FACILITY NO. 2: TERM LOAN AMOUNT AND TERMS
2.1 OUTSTANDING TERM LOAN. There is outstanding from the Bank to the
Borrower a term loan in the original principal amount of Five Hundred
Thousand Dollars ($500,000). This term loan is currently subject to the terms
and conditions of Facility No. 2 of the Business Loan Agreement dated April
24, 1995. As of the date of this Agreement, the term loan shall be deemed to
be outstanding under Facility No. 2 of this Agreement, and shall be subject to
all the terms and conditions stated in this Agreement.
2.2 INTEREST RATE. Unless the Borrower elects an optional interest rate as
described below, the interest rate is the Reference Rate plus .5 percentage
point.
2.3 REPAYMENT TERMS.
(a) The Borrower will repay principal and interest in Ten successive monthly
installments of Fifteen Thousand Six Hundred Seventy-Nine and 72/100
Dollars ($15,679.72) starting September 10, 1997. On May 11, 1998, the
Borrower will repay the remaining principal balance plus any interest then
due.
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(b) The Borrower may prepay the loan if full or in part at any time. The
prepayment will be applied to the most remote installment of principal due
under this agreement.
2.4 OPTIONAL INTEREST RATES. Instead of the interest rate based on the
Reference Rate, the Borrower may elect to have all or portions of the loan
bear interest at the rate(s) described below during an interest period agreed
to by the Bank and the Borrower. Each interest rate is a rate per year.
Interest will be paid on the last day of each intrest period, and on the
first day each month and on the last day of each interest period. At the end
of any interest period, the interest rate will revert to the rate based on
the Reference Rate, unless the Borrower has designated another optional
interest rate for the portion.
2.5 LONG TERM RATE. The Borrower may elect to have all or portions of the
principal balance of the loan bear interest at the Long Term Rate, subject to
the following requirements:
(a) The interest period during which the Long Term Rate will be in effect
will be one year or more.
(b) The "Long Term Rate" means the fixed interest rate the Bank and the
Borrower agree will apply to the portion during the applicable interest
period.
(c) Each Long Term Rate portion will be for an amount not less than One
Hundred Thousand Dollars ($100,000).
(d) Any portion of the principal balance of the loan already bearing
interest at the Long Term Rate will not be converted to a different rate
during its interest period.
(e) The Borrower may prepay the Long Term Rate portion in whole or in part
in the minimum amount of One Hundred Thousand Dollars ($100,000). The
Borrower will give the Bank irrevocable written notice of the Borrower's
intention to make the prepayment, specifying the date and amount of the
prepayment. The notice must be received by the Bank at least 5 banking days
in advance of the prepayment. All prepayments of principal on the Long Term
Rate portion will be applied on the most remote principal installment or
installments then unpaid.
(f) Each prepayment of a Long Term Rate portion, whether voluntary, by
reason of acceleration or otherwise, will be accompanied by payment of all
accrued interest on the amount of the prepayment and the prepayment fee
described below.
(g) The prepayment fee will be the sum of fees calculated separately for each
Prepaid Installment, as follows:
(i) The Bank will first determine the amount of interest which would
have accrued each month for the Prepaid Installment had it remained
outstanding until the applicable Original Payment Date, using the
Long Term Rate;
(ii) The Bank will then subtract from each monthly interest amount
determined in (i), above, the amount of interest which would accrue for
that Prepaid Installment if it were reinvested from the date of
prepayment through the Original Payment Date, using the following rate:
(A) If the Original Payment Date is more than 5 years after the date of
prepayment: the Treasury Rate plus one-quarter of one percentage
point;
(B) If the Original Payment Date is 5 years or less after the date of
prepayment: the Money Market Rate.
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(iii) If (i) minus (ii) for the Prepaid Installment is greater than
zero, the Bank will discount the monthly differences to the date of
prepayment by the rate used in (ii) above. The sum of the discounted
monthly differences is the prepayment fee for that Prepaid
Installment.
(h) The following definitions will apply to the calculation of the prepayment
fee:
"Money Market" means the domestic certificate of deposit market, the
eurodollar deposit market or other appropriate money market
selected by the Bank.
"Money Market Rate" means the fixed interest rate per annum which the
Bank determines could be obtained by reinvesting a specified Prepaid
Installment in the Money Market from the date of prepayment through the
Original Payment Date.
"Original Payment Dates" mean the dates on which principal of the Long
Term Rate portion would have been paid if there had been no prepayment.
If a portion of the principal would have been paid later than the end of
the interest period in effect at the time of prepayment, then the
Original Payment Date for that portion will be the last day of the
interest period.
"Prepaid Installment" means the amount of the prepaid principal of the
Long Term Rate portion which would have been paid on a single Original
Payment Date.
"Treasury Rate" means the interest rate yield for U.S. Government
Treasury Securities which the Bank determines could be obtained by
reinvesting a specified Prepaid Installment in such securities from the
date of prepayment through the Original Payment Date.
(i) The Bank may adjust the Treasury Rate and Money Market Rate to
reflect the compounding, accrual basis, or other costs of the Long Term
Rate portion. Each of the rates is the Bank's estimate only and the Bank
is under no obligation to actually reinvest any prepayment. The rates
will be based on information from either the Telerate or Reuters
information services, The Wall Street Journal, or other information
sources the Bank deems appropriate.
3. FACILITY NO. 3 TERM LOAN AMOUNT AND TERMS
3.1 OUTSTANDING TERM LOAN. There is outstanding from the Bank to the Borrower
a term loan in the original principal amount of Two Million Dollars
($2,000,000). This term loan is currently subject to the terms and conditions
of Facility No. 3 of the Business Loan Agreement dated April 24, 1995. As of
the date of this Agreement, the term loan shall be deemed to be outstanding
under Facility No. 3 of this Agreement, and shall be subject to all the terms
and conditions stated in this Agreement.
3.2 INTEREST RATE. The interest rate is the Reference Rate plus 1.0
percentage point.
3.3 REPAYMENT TERMS.
(a) The Borrower will repay principal, interest and any other amounts
due, upon demand by the Bank, in the event of any default by a Nominee
Borrower.
(b) The Borrower may prepay each term loan in full or in part at any
time. Each prepayment will be applied to the most remote installment of
principal due under such term loan.
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3.4 NOMINEE BORROWER. At the Bank's sole option, during the availability
period described in 3.2 of the original Business Loan Agreement dated April
24, 1995, the Borrower may designate certain individuals, each of whom shall
be an Executive or officer of the Borrower, to whom the Bank may provide a
36 month term loan. The amount of any extension of credit to a Nominee
Borrower shall reduce the amount of the Facility 3 Commitment. Each such
Nominee Borrower shall execute a note and any other documents required by
the Bank, all in form and substance satisfactory to the Bank, evidencing
each term loan. Each note and term loan shall be guaranteed by the Borrower.
3.5 NOMINEE BORROWER TERM. The Bank and each Nominee Borrower shall execute
a note and any other documents required by the Bank. The documents shall
provide that the term of each term loan shall not exceed 36 months. The
Borrower will be required to make periodic interest payments and periodic
defined principal reductions. The term loans to the Nominee Borrowers shall
be unsecured but will be supported by a guaranty of the Borrower.
4. FACILITY NO. 4: TERM LOAN AMOUNT AND TERMS
4.1 OUTSTANDING TERM LOAN. There is outstanding from the Bank to the Borrower
a term loan in the original principal amount of Five Hundred Thousand Dollars
($500,000). This term loan is currently subject to the terms and conditions
of Facility No. 4 of the Business Loan Agreement dated April 24, 1995. As of
the date of this Agreement, the term loan shall be deemed to be outstanding
under Facility No. 4 of this Agreement, and shall be subject to all the terms
and conditions stated in this Agreement.
4.2 INTEREST RATE. Unless the Borrower elects an optional interest rate as
described below, the interest rate is the Reference Rate plus .5 percentage
point.
4.3 REPAYMENT TERMS.
(a) The Borrower will pay all accrued but unpaid interest on the 1st day of
each month and upon payment in full of the principal of this loan.
(b) The Borrower will repay principal in 15 successive equal monthly
installments of Thirteen Thousand Eight Hundred Eighty-Eight and 89/100
(13,888.89) starting September 1, 1997. On November 2, 1998, the Borrower
will repay the remaining principal balance plus any interest then due.
4.4 OPTIONAL INTEREST RATES. Instead of the interest rate based on the
Reference Rate, the Borrower may elect to have all or portions of the loan
bear interest at the rate(s) described below during an interest period agreed
to by the Bank and the Borrower. Each interest rate is a rate per year.
Interest will be paid on the last day of each interest period, and on the
first day each month and on the last day of each interest period. At the end
of any interest period, the interest rate will revert to the rate based on
the Reference Rate, unless the Borrower has designated another optional
interest rate for the portion.
4.5 LONG TERM RATE. The Borrower may elect to have all or portions of the
principal balance of the loan bear interest at the Long Term Rate, subject to
the following requirements:
(a) The interest period during which the Long Term Rate will be in effect
will be one year or more.
(b) The "Long Term Rate" means the fixed interest rate the Bank and the
Borrower agree will apply to the portion during the applicable interest
period.
(c) Each Long Term Rate portion will be for an amount not less than One
Hundred Thousand Dollars ($100,000).
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(d) Any portion of the principal balance of the loan already bearing
interest at the Long Term Rate will not be converted to a different rate
during its interest period.
(e) The Borrower may prepay the Long Term Rate portion in whole or in part
in the minimum amount of One Hundred Thousand Dollars ($100,000). The
Borrower will give the Bank irrevocable written notice of the Borrower's
intention to make the prepayment, specifying the date and amount of the
prepayment. The notice must be received by the Bank at least 5 banking days
in advance of the prepayment. All prepayments of principal on the Long Term
Rate portion will be applied on the most remote principal installment or
installments then unpaid.
(f) Each prepayment of a Long Term Rate portion, whether voluntary, by
reason of acceleration or otherwise, will be accompanied by payment of all
accrued interest on the amount of the prepayment and the prepayment fee
described below.
(g) The prepayment fee will be the sum of fees calculated separately for each
Prepaid Installment, as follows:
(i) The Bank will first determine the amount of interest which would
have accrued each month for the Prepaid Installment had it remained
outstanding until the applicable Original Payment Date, using the Long
Term Rate;
(ii) The Bank will then subtract from each monthly interest amount
determined in (i), above, the amount of interest which would accrue for
that Prepaid Installment if it were reinvested from the date of
prepayment through the Original Payment Date, using the following rate:
(A) If the Original Payment Date is more than 5 years after the date
of prepayment: the Treasury Rate plus one-quarter of one percentage
point;
(B) If the Original Payment Date is 5 years or less after the date of
prepayment: the Money Market Rate.
(iii) If (i) minus (ii) for the Prepaid Installment is greater than
zero, the Bank will discount the monthly differences to the date of
prepayment by the rate used in (ii) above. The sum of the discounted
monthly differences is the prepayment fee for that Prepaid Installment.
(h) The following definitions will apply to the calculation of the prepayment
fee:
"Money Market" means the domestic certificate of deposit market, the
eurodollar deposit market or other appropriate money market selected by
the Bank.
"Money Market Rate" means the fixed interest rate per annum which the
Bank determines could be obtained by reinvesting a specified Prepaid
Installment in the Money Market from the date of prepayment through the
Original Payment Date.
"Original Payment Dates" mean the dates on which principal of the Long Term
Rate portion would have been paid if there had been no prepayment. If a
portion of the principal would have been paid later than the end of the
interest period in effect at the time of prepayment, then the Original
Payment Date for that portion will be the last day of the interest period.
"Prepaid Installment" means the amount of the prepaid principal of
the Long Term Rate portion which would have been paid on a single Original
Payment Date.
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"Treasury Rate" means the interest rate yield for U.S. Government Treasury
Securities which the Bank determines could be obtained by reinvesting a
specified Prepaid Installment in such securities from the date of
prepayment through the Original Payment Date.
(i) The Bank may adjust the Treasury Rate and Money Market Rate to reflect
the compounding, accrual basis, or other costs of the Long Term Rate
portion. Each of the rates is the Bank's estimate only and the Bank is
under no obligation to actually reinvest any prepayment. The rates will
be based on information from either the TELERATE or REUTERS information
services, THE WALL STREET JOURNAL, or other information sources the Bank
deems appropriate.
5. FACILITY NO. 5: TERM LOAN AMOUNT AND TERMS
5.1 OUTSTANDING TERM LOAN. There is outstanding from the Bank to the
Borrower a term loan in the original principal amount of Two Million Dollars
($2,000,000). This term loan is currently subject to the terms and conditions
of Facility No. 5 of the Business Loan Agreement dated April 24, 1995. As of
the date of this Agreement, the term loan shall be deemed to be outstanding
under Facility No. 5 of this Agreement, and shall be subject to all the terms
and conditions stated in this Agreement.
5.2 INTEREST RATE. Unless the Borrower elects an optional interest rate as
described below, the interest rate is the Reference Rate plus .5 percentage
point.
5.3 REPAYMENT TERMS.
(a) The Borrower will repay principal and interest in Twenty successive
monthly installments of Sixty Thousand Six Hundred Fifty-Nine and 47/100
($60,659.47) starting September 1, 1997.
(b) The Borrower may prepay the loan in full or in part at any time. The
prepayment will be applied to the most remote installment of principal
due under this agreement.
5.4 OPTIONAL INTEREST RATES. Instead of the interest rate based on the
Reference Rate, the Borrower may elect to have all or portions of the loan
bear interest at the rate(s) described below during an interest period agreed
to by the Bank and the Borrower. Each interest rate is a rate per year.
Interest will be paid on the last day of each interest period, and on the
first day each month and on the last day of each interest period. At the end
of any interest period, the interest rate will revert to the rate based on
the Reference Rate, unless the Borrower has designated another optional
interest rate for the portion.
5.5 LONG TERM RATE. The Borrower may elect to have all or portions of the
principal balance of the loan bear interest at the Long Term Rate, subject to
the following requirements:
(a) The interest period during which the Long Term Rate will be in effect
will be one year or more.
(b) The "Long Term Rate" means the fixed interest rate the Bank and the
Borrower agree will apply to the portion during the applicable interest
period.
(c) Each Long Term Rate portion will be for an amount not less than One
Hundred Thousand Dollars ($100,000).
(d) Any portion of the principal balance of the loan already bearing interest
at the Long Term Rate will not be converted to a different rate during
its interest period.
(e) The Borrower may prepay the Long Term Rate portion in whole or in part
in the minimum amount of One Hundred Thousand Dollars ($100,000). The
Borrower will give the Bank irrevocable written notice of the Borrower's
intention to make the prepayment, specifying the date and amount of the
prepayment. The notice must be received by the Bank at least 5 banking
days in advance of the prepayment. All
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prepayments of principal on the Long Term Rate portion will be applied
on the most remote principal installment or installments then unpaid.
(f) Each prepayment of a Long Term Rate portion, whether voluntary, by
reason of acceleration or otherwise, will be accompanied by payment of
all accrued interest on the amount of the prepayment and the prepayment
fee described below.
(g) The prepayment fee will be the sum of fees calculated separately for
each Prepaid Installment, as follows:
(i) The Bank will first determine the amount of interest which would
have accrued each month for the Prepaid Installment had it remained
outstanding until the applicable Original Payment Date, using the
Long Term Rate;
(ii) The Bank will then subtract from each monthly interest amount
determined in (i), above, the amount of interest which would
accrue for that Prepaid Installment if it were reinvested from
the date of prepayment through the Original Payment Date, using
the following rate:
(A) If the Original Payment Date is more than 5 years after the
date of prepayment: the Treasury Rate plus one-quarter of
one percentage point;
(B) If the Original Payment Date is 5 years or less after the
date of prepayment: the Money Market Rate.
(iii) If (i) minus (ii) for the Prepaid Installment is greater than
zero, the Bank will discount the monthly differences to the date
of prepayment by the rate used in (ii) above. The sum of the
discounted monthly differences is the prepayment fee for that
Prepaid Installment.
(h) The following definitions will apply to the calculation of the prepayment
fee:
"Money Market" means the domestic certificate of deposit market, the
eurodollar deposit market or other appropriate money market selected by
the Bank.
"Money Market Rate" means the fixed interest rate per annum which the
Bank determines could be obtained by reinvesting a specified Prepaid
Installment in the Money Market from the date of prepayment through the
Original Payment Date.
"Original Payment Dates" mean the dates on which principal of the Long
Term Rate portion would have been paid if there had been no prepayment.
If a portion of the principal would have been paid later than the end of
the interest period in effect at the time of prepayment, then the
Original Payment Date for that portion will be the last day of the
interest period.
"Prepaid Installment" means the amount of the prepaid principal of the
Long Term Rate portion which would have been paid on a single Original
Payment Date.
"Treasury Rate" means the interest rate yield for U.S. Government
Treasury Securities which the Bank determines could be obtained by
reinvesting a specified Prepaid Installment in such securities from the
date of prepayment through the Original Payment Date.
(i) The Bank may adjust the Treasury Rate and Money Market Rate to reflect
the compounding, accrual basis, or other costs of the Long Term Rate
portion. Each of the rates is the Bank's estimate only and the Bank is
under no obligation to actually reinvest any prepayment. The rates will
be based on information from either the Telerate or Reuters information
services, The Wall Street Journal, or other information sources the Bank
deems appropriate.
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6. FEES AND EXPENSES
6.1 UNUSED COMMITMENT FEE. The Borrower agrees to pay a fee on any difference
between the Facility 1 Commitment and the amount of credit it actually
uses, determined by the weighted average loan balance maintained during
the specified period. The fee will be calculated at .20% per year. This
fee is paid quarterly in arrears.
6.2 EXPENSES.
(a) The Borrower agrees to immediately repay the Bank for expenses that
include, but are not limited to, filing, recording and search fees,
appraisal fees, title report fees and documentation fees.
(b) The Borrower agrees to reimburse the Bank for any expenses it incurs in the
preparation of this Agreement and any agreement or instrument required by
this Agreement. Expenses include, but are not limited to, reasonable
attorneys' fees, including any allocated costs of the Bank's in-house
counsel.
(c) The Borrower agrees to reimburse the Bank for the cost of periodic audits
and appraisals of the personal property collateral securing this
Agreement, at such intervals as the Bank may reasonable require. The
audits and appraisals may be performed by employees of the Bank of by
independent appraisers.
7. COLLATERAL
7.1 PERSONAL PROPERTY. The Borrower's obligations to the Bank under will be
secured by personal property the Borrower now owns or will own in the future
as listed below. The collateral is further defined in security agreement(s)
executed by the Borrower. In addition, all personal property collateral
securing this Agreement shall also secure all other present and future
obligations of the Borrower to the Bank (excluding any consumer credit
covered by the Federal Truth in Lending law, unless the Borrower has
otherwise agreed in writing). All personal property collateral securing any
other present or future obligations of the Borrower to the Bank shall also
secure this Agreement.
(a) Machinery and equipment.
(b) Receivables.
7.2 CASH COLLATERAL. (FACILITY 3). If the aggregate principal balance
outstanding on the term loan described in 3.1 on August 10, 1997 exceeds 60%
of the original aggregate balance of the term loans, the Borrower shall
provide the Bank with cash collateral equal to the amount of the difference.
The Borrower agrees to execute any documents which the Bank may require in
order to perfect the Bank's security interest in such collateral.
8. DISBURSEMENTS, PAYMENTS AND COSTS
8.1 REQUESTS FOR CREDIT. Each request for an extension of credit will be made
in writing in a manner acceptable to the Bank, or by another means acceptable
to the Bank.
8.2 DISBURSEMENTS AND PAYMENTS. Each disbursement by the Bank and each
payment by the Borrower will be:
(a) made at the Bank's branch (or other location) selected by the Bank
from time to time;
(b) made for the account of the Bank's branch selected by the Bank from
time to time;
(c) made in immediately available funds, or such other type of funds
selected by the Bank;
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(d) evidenced by records kept by the Bank. In addition, the Bank may, at
its discretion, require the Borrower to sign one or more promissory notes.
8.3 TELEPHONE AUTHORIZATION.
(a) The Bank may honor telephone instructions for advances or repayments or for
the designation of optional interest rates signer(s) of this Agreement or
a person or persons authorized by the signer(s) of this Agreement on
Facility 1.
(b) Advances on Facility 1 will be deposited in and repayments will be withdrawn
from the Borrower's account number 28013-00339, or such other accounts
with the Bank as designated in writing by the Borrower.
(c) The Borrower indemnifies and execuses the Bank (including its officers,
employees, and agents) for, from and against all liability, loss, and
costs in connection with any act resulting from telephone instructions it
reasonably believes are made by a signer of this Agreement or a person
authorized by a signer. This indemnity and excuse will survive this
Agreement's termination.
8.4 DIRECT DEBIT (PRE-BILLING)
(a) The Borrower agrees that the Bank will debit the Borrower's deposit account
number 28013-00339 (the "Designated Account") on the date each payment of
principal and interest and any fees from the Borrower becomes due (the
"Due Date"). If the Due Date is not a banking day, the Designated Account
will be debited on the next banking day.
(b) Approximately 10 days prior to the Due Date on Facility 1 Commitment, the
Bank will mail to the Borrower a statement of the amounts that will be
due on that Due Date (the "Billed Amount"). The calculation will be made
on the assumption that no new extensions of credit or payments will be
made between the date of the billing statement and the Due Date, and that
there will be no changes in the applicable interest rate.
(c) The Bank will debit the Designated Account for the Billed Amount,
regardless of the actual amount of principal due and interest accrued
(collectively, the "Accrued Amount").
If the Billed Amount debited to the Designated Account differs from the
Accrued Amount, the discrepancy will be treated as follows:
(i) If the Billed Amount is less than the Accrued Amount, the Billed
Amount for the following Due Date will be increased by the amount of
the discrepancy. The Borrower will not be in default by reason of any
such discrepancy.
(ii) If the Billed Amount is more than the Accrued Amount, the Billed
Amount for the following Due Date will be decreased by the amount of
the discrepancy.
Regardless of any such discrepancy, interest will continue to accrue
based on the actual amount of principal outstanding without compounding.
The Bank will not pay the Borrower interest on any overpayment.
(d) The Borrower will maintain sufficient funds in the Designated Account to
cover each debit. If there are insufficient funds in the Designated
Account on the date the Bank enters any debit authorized by this
Agreement, the debit will be reversed.
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8.5 BANKING DAYS. Unless otherwise provided in this Agreement, a banking
day is a day other than a Saturday or a Sunday on which the Bank is open for
business in Oregon and banks are open for business in California. For amounts
bearing interest at an offshore rate (if any), a banking day is a day other
than a Saturday or a Sunday on which the Bank is open for business in Oregon
and the Bank is dealing in offshore dollars. All payments and disbursements
which would be due on a day which is not a banking day will be due on the
next banking day. All payments received on a day which is not a banking day
will be applied to the credit on the next banking day.
8.6 TAXES. The Borrower will not deduct any taxes from any payments it
makes to the Bank. If any government authority imposes any taxes or charges
on any payments made by the Borrower, the Borrower will pay the taxes or
charges. Upon request by the Bank, the Borrower will confirm that it has paid
the taxes by giving the Bank official tax receipts (or notarized copies)
within 30 days after the due date. However, the Borrower will not pay the
Bank's net income taxes.
8.7 ADDITIONAL COSTS. The Borrower will pay the Bank, on demand, for the
Bank's costs or losses arising from any statute or regulation, or any request
or requirement of a regulatory agency. The costs and losses will be allocated
to the loan in a manner determined by the Bank, using any reasonable method.
The costs include the following:
(a) any reserve or deposit requirements; and
(b) any capital requirements relating to the Bank's assets and commitments
for credit.
8.8 INTEREST CALCULATION. Except as otherwise stated in this Agreement, all
interest and fees, if any, will be computed on the basis of a 360-day year
and the actual number of days elapsed. This results in more interest or a
higher fee than if a 365-day year is used.
8.9 INTEREST ON LATE PAYMENTS. At the Bank's sole option in each instance,
any amount not paid when due under this Agreement (including interest) shall
bear interest from the due date at the Reference Rate plus 1.0 percentage
point. This may result in compounding of interest.
8.10 DEFAULT RATE. Upon the occurrence and during the continuation of any
default under this Agreement, advances under this Agreement will at the
option of the Bank bear interest at a rate per annum which is 1.0 percentage
point higher than the rate of interest otherwise provided under this
Agreement. This will not constitute a waiver of any event of default.
9. CONDITIONS
The Bank must receive the following items, in form and content acceptable to
the Bank, before it is required to extend any credit to the Borrower under
this Agreement:
9.1 AUTHORIZATIONS. Evidence that the execution, delivery and performance
by the Borrower of this Agreement and any instrument or agreement required
under this Agreement have been duly authorized.
9.2 SECURITY AGREEMENTS. Signed original security agreements, financing
statements and fixture filings (together with collateral in which the Bank
requires a possessory security interest), which the Bank requires.
9.3 EVIDENCE OF PRIORITY. Evidence that security interests and liens in
favor of the Bank are valid, enforceable, and prior to all others' rights and
interests, except those the Bank consents to in writing.
9.4 INSURANCE. Evidence of insurance coverage, as required in the
"Covenants" section of this Agreement.
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9.5 BORROWER'S GUARANTY. Guaranty signed by the Borrower in the amount of
the extension of credit to each Nominee Borrower.
9.6 OTHER ITEMS. Any other items that the Bank reasonably requires.
10. REPRESENTATIONS AND WARRANTIES
When the Borrower signs this Agreement, and until the Bank is repaid in full,
the Borrower makes the following representations and warranties. Each
request for an extension of credit constitutes a renewed representation:
10.1 ORGANIZATION OF BORROWER. The Borrower is a corporation duly formed
and existing under the laws of the state where organized.
10.2 AUTHORIZATION. This Agreement, and any instrument or agreement
required hereunder, including the guaranty of loans to Nominee Borrowers, are
within the Borrower's powers, have been duly authorized, and do not conflict
with any of its organizational papers.
10.3 ENFORCEABLE AGREEMENT. This Agreement is a legal, valid and binding
agreement of the Borrower, enforceable against the Borrower in accordance
with its terms, and any instrument or agreement required hereunder, when
executed and delivered, will be similarly legal, valid, binding and
enforceable.
10.4 GOOD STANDING. In each state in which the Borrower does business, it
is properly licensed, in existence and in good standing, and, where required,
in compliance with fictitious name statutes.
10.5 NO CONFLICTS. This Agreement does not conflict with any law,
agreement, or obligation by which the Borrower is bound.
10.6 FINANCIAL INFORMATION. All financial and other information that has
been or will be supplied to the Bank, including the Borrower's financial
statement dated as of March 31, 1997 is:
(a) sufficiently complete to give the Bank accurate knowledge of the
Borrower's financial condition.
(b) in form and content required by the Bank.
(c) in compliance with all government regulations that apply.
Since the date of the financial statement specified above, there has been no
material adverse change in the assets or the financial condition of the
Borrower.
10.7 LAWSUITS. There is no lawsuit, tax claim or other dispute pending or
threatened against the Borrower which, if lost, would impair the Borrower's
financial condition or ability to repay the loan, except as have been
disclosed in writing to the Bank.
10.8 COLLATERAL. All collateral required in this Agreement is owned by the
grantor of the security interest free of any title defects or any liens or
interests of others.
10.9 PERMITS, FRANCHISES. The Borrower possesses all permits, memberships,
franchises, contracts and licenses required and all trademark rights, trade
name rights, patent rights and fictitious name rights necessary to enable it
to conduct the business in which it is now engaged without conflict with the
rights of others.
10.10 OTHER OBLIGATIONS. The Borrower is not in default on any obligation
for borrowed money, any purchase money obligations or any other material
lease, commitment, contract, instrument or obligation.
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10.11 INCOME TAX RETURNS. The Borrower has no knowledge of any pending
assessments or adjustments of its income tax for any year, except as have
been disclosed in writing to the Bank.
10.12 NO EVENT OF DEFAULT. There is no event which is, or with notice or
lapse of time or both would be, a default under this Agreement.
11. COVENANTS
The Borrower agrees, so long as credit is available under this Agreement and
until the Bank is repaid in full:
11.1 USE OF PROCEEDS.
(a) To use the proceeds of the Facility 1 credit only for working capital.
(b) To use the proceeds of the Facility 2 credit only for equipment
purchases.
(c) To use the proceeds of the Facility 3 credit only for Nominee Borrower
term loans.
11.2 FINANCIAL INFORMATION. To provide the following financial information
and statements and such additional information as requested by the Bank from
time to time:
(a) Within 90 days of the Borrower's fiscal year end, the Borrower's
annual 10K with audit.
(b) Within 45 days of the quarter end, the Borrower's 10Q.
11.3 CURRENT RATIO. To maintain on a consolidated basis a ratio of current
assets to current liabilities of at least 25:10.
For the purpose of this paragraph current assets shall consist of (i) cash,
(ii) trade receivables, (iii) revenue earned in excess of billings and (iv)
prepaid expenses. Facility No. 1 will be deemed a current liability for
purposes of calculating this covenant.
11.4 TANGIBLE NET WORTH. To maintain on a consolidated basis tangible net
worth equal to at least Thirty Three Million Dollars ($33,000,000).
"Tangible net worth" means the gross book value of the Borrower's assets
(excluding goodwill, patents, trademarks, trade names, organization expense,
treasury stock, unamortized debt discount and expense, deferred research and
development costs, deferred marketing expenses, and other like intangibles)
less total liabilities, including but not limited to accrued and deferred
income taxes, and any reserves against assets.
11.5 MAXIMUM NET LOSS. To report on a consolidated basis a net loss after
taxes and extraordinary items not to exceed Two Million Dollars ($2,000,000)
for each period of two (2) consecutive quarters.
11.6 OTHER DEBTS. Not to have outstanding or incur any direct or contingent
debts (other than those to the Bank and its affiliates), or become liable for
the debts of others without the Bank's written consent. This does not
prohibit:
(a) Acquiring goods, supplies, or merchandise on normal trade credit.
(b) Endorsing negotiable instruments received in the usual course of
business.
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(c) Obtaining safety bonds in the usual course of business.
(d) Debts and lines of credit in lines on the date of this
Agreement disclosed in writing to the Bank.
11.6 OTHER LIENS. Not to create, assume, or allow any security interest or lien
(including judicial liens) on property the borrower now or later owns, except:
(a) Deeds of trust and security agreements in favor of the Bank and its
affiliates.
(b) Liens for taxes not yet due.
(c) Liens outstanding on the date of this Agreement disclosed in writing to
the Bank.
11.7 LOANS TO OFFICERS. Not to make any loans, advances or other extensions
of credit (excluding those term loans provided for under the Facility 3
Commitment) to any of the Borrower's executives, officers, or directors or
shareholders (or any relatives of any of the foregoing) in an amount which
exceeds Twenty Thousand ($20,000) in the aggregate.
11.8 NOTICES TO BANK. To promptly notify the Bank in writing of:
(a) any lawsuit over Tow Hundred Fifty Thousand Dollars ($250,000) against
the Borrower.
(b) any substantial dispute between the borrower and any government
authority.
(c) any failure to comply with this Agreement.
(d) any material adverse change in the Borrower's financial condition or
operations.
(e) any change in the borrower's name, address or legal structure.
11.9 BOOKS AND RECORDS. to maintain adequate books and records.
11.10 AUDITS. To allow the Bank and its agents to inspect the Borrower's
properties and examine, audit and make copies of books and records at any
reasonable time. If any of the borrower's properties, books or records are in
the possession of a third party, the borrower authorizes that third party to
permit the Bank or its agents to have access to perform inspections or audits
and to respond to the Bank's requests for information concerning such
properties, books and records.
11.11 COMPLIANCE WITH LAWS. To comply with the laws (including any fictitious
name statute), regulations, and orders of any government body with authority
over the Borrower's business.
11.12 PRESERVATION OF RIGHTS. To maintain and preserve all rights,
privileges, and franchises the Borrower now has.
11.13 MAINTENANCE OF PROPERTIES. To make any repairs, renewals, or
replacements to keep the Borrower's properties in good working condition.
11.14 PERFECTION OF LIENS. To help the Bank perfect and protect its security
interest and liens, and reimburse it for related costs it incurs to protect
its security interests and liens.
11.15 COOPERATION. To take any action requested by the bank to carry out the
intent of this Agreement.
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11.16 INSURANCE.
(a) INSURANCE COVERING COLLATERAL. To maintain all risk property damage
insurance policies covering the tangible property comprising the
collateral. Each insurance policy must be in an amount acceptable to the
Bank. The insurance must be issued by an insurance company acceptable to
the Bank and must include a lender's loss payable endorsement in favor of
the Bank in a form acceptable to the Bank.
(b) GENERAL BUSINESS INSURANCE. To maintain insurance satisfactory to the
Bank as to amount, nature and carrier covering property damage (including
loss of use and occupancy) to any of the Borrower's properties, public
liability insurance including coverage for contractual liability, product
liability and workers' compensation, and any other insurance which is
usual for the Borrower's business.
(c) EVIDENCE OF INSURANCE. Upon the request of the Bank, to deliver to the
Bank a copy of each insurance policy, or, if permitted by the Bank, a
certificate of insurance listing all insurance in force.
11.17 ADDITIONAL NEGATIVE COVENANTS. Not to, without the Bank's written consent:
(a) engage in any business activities substantially different from the
Borrower's present business.
(b) liquidate or dissolve the Borrower's business.
(c) enter into any consolidation, merger, pool, joint venture, syndicate, or
other combination.
(d) lease, or dispose of all or a substantial part of the Borrower's business
or the Borrower's assets.
(e) acquire or purchase a business or its assets.
(f) sell or otherwise dispose of any assets for less than fair market value,
or enter into any sale and leaseback agreement covering any of its fixed
or capital assets.
12. HAZARDOUS WASTE INDEMNIFICATION
The Borrower will indemnify and hold harmless the Bank for, from, and against
any loss or liability directly or indirectly arising out of the use, generation,
manufacture, production, storage, release, threatened release, discharge,
disposal or presence of a hazardous substance. This indemnity will apply whether
the hazardous substance is on, under or about the Borrower's property or
operations or property leased to the Borrower. The indemnity includes but is not
limited to attorneys' fees (including the reasonable estimate of the allocated
cost of in-house counsel and staff). The indemnity extends to the Bank, its
parent, subsidiaries and all of their directors, officers, employees, agents,
successors, attorneys and assigns. For these purposes, the term "hazardous
substances" means any substance which is or becomes designated as "hazardous" or
"toxic" under any federal, state or local law, or any petroleum products,
including crude oil and any product derived directly or indirectly from, or any
fraction or distillate of, crude oil. This indemnity will survive repayment of
the Borrower's obligations to the Bank.
13. DEFAULT
If any of the following events occur, the Bank may do one or more of the
following: declare the Borrower in default, stop making any additional credit
available to the Borrower, and require the Borrower to repay its entire debt
immediately and without prior notice. If a bankruptcy petition is filed with
respect to the Borrower, the entire debt outstanding under this Agreement
will automatically become due immediately.
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13.1 FAILURE TO PAY. The Borrower fails to make a payment under this
Agreement when due.
13.2 NON-COMPLIANCE. The Borrower fails to meet the conditions of, or fails
to perform any obligation under:
(a) this Agreement,
(b) any other agreement made in connection with this loan, or
(c) any other agreement the Borrower has with the Bank or any affiliate of
the Bank.
13.3 CROSS-DEFAULT. Any default occurs under any agreement in connection
with any credit the Borrower has obtained from anyone else or which the
Borrower has guaranteed.
13.4 LIEN PRIORITY. The Bank fails to have an enforceable first lien (except
for any prior liens to which the Bank has consented in writing) on or
security interest in any property given as security for this loan.
13.5 FALSE INFORMATION. The Borrower has given the Bank false or misleading
information or representations.
13.6 BANKRUPTCY. The Borrower files a bankruptcy petition, a bankruptcy
petition is filed against the Borrower, or the Borrower makes a general
assignment for the benefit of creditors.
13.7 RECEIVERS. A receiver or similar official is appointed for the
Borrower's business, or the business is terminated.
13.8 LAWSUITS. Any lawsuit or lawsuits are filed on behalf of one or more
trade creditors against the Borrower in an aggregate amount of Two Hundred
Fifty Thousand Dollars ($250,000) or more in excess of any insurance coverage.
13.9 JUDGMENTS. Any judgments or arbitration awards are entered against the
Borrower; or the Borrower enters into any settlement agreements with respect
to any litigation or arbitration, in an aggregate amount of Two Hundred Fifty
Thousand Dollars ($250,000) or more in excess of any insurance coverage.
13.10 GOVERNMENT ACTION. Any government authority takes action that the Bank
believes materially adversely affects the Borrower's financial condition or
ability to repay.
13.11 DEFAULT UNDER GUARANTY OR SUBORDINATION AGREEMENT. Any guaranty,
subordination agreement, security agreement, deed of trust, or other document
required by this Agreement is violated or no longer in effect.
13.12 MATERIAL ADVERSE CHANGE. A material adverse change occurs in the
Borrower's financial condition, properties or prospects, or ability to repay
the loan.
13.13 NOMINEE BORROWER DEFAULT. Any Nominee Borrower fails to make any
payment when due under any term loan as described in Article 3 of this
Agreement.
14. ENFORCING THIS AGREEMENT; MISCELLANEOUS
14.1 GAAP. Except as otherwise stated in this Agreement, all financial
information provided to the Bank and all financial covenants will be made
under generally accepted accounting principles, consistently applied.
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14.2 OREGON LAW. This Agreement is governed by Oregon law.
14.3 SUCCESSORS AND ASSIGNS. This Agreement is binding on the Borrower's
and the Bank's successors and assignees. The Borrower agrees that it may not
assign this Agreement without the Bank's prior consent. The Bank may sell
participations in or assign this loan, and may exchange financial information
about the Borrower with actual or potential participants or assignees. If a
participation is sold or the loan is assigned, the purchaser will have the
right of set-off against the Borrower.
14.4 ARBITRATION.
(a) This paragraph concerns the resolution of any controversies or claims
between the Borrower and the Bank, including but not limited to those
that arise from:
(i) This Agreement (including any renewals, extensions or
modifications of this Agreement);
(ii) Any document, agreement or procedure related to or delivered in
connection with this Agreement;
(iii) Any violation of this Agreement; or
(iv) Any claims for damages resulting from any business conducted
between the Borrower and the Bank, including claims for injury
to persons, property or business interests (torts).
(b) At the request of the Borrower or the Bank, any such controversies or
claims will be settled by arbitration in accordance with the United
States Arbitration Act. The United States Arbitration Act will apply
even though this Agreement provides that it is governed by Oregon law.
(c) Arbitration proceedings will be administered by the American
Arbitration Association and will be subject to its commercial rules of
arbitration.
(d) For purposes of the application of the statute of limitations, the
filing of an arbitration pursuant to this paragraph is the equivalent of
the filing of a lawsuit, and any claim or controversy which may be
arbitrated under this paragraph is subject to any applicable statute of
limitations. The arbitrators will have the authority to decide whether
any such claim or controversy is barred by the statute of limitations
and, if so, to dismiss the arbitration on that basis.
(e) If there is a dispute as to whether an issue is arbitrable, the
arbitrators will have the authority to resolve any such dispute.
(f) The decision that results from an arbitration proceeding may be
submitted to any authorized court of laws to be confirmed and enforced.
(g) This provision does not limit the right of the Borrower or the Bank to:
(i) exercise self-help remedies such as setoff;
(ii) foreclose against or sell any real or personal property
collateral; or
(iii) act in a court of law, before, during or after the arbitration
proceeding to obtain:
(A) a provisional or interim remedy; and/or
(B) additional or supplemental remedies.
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(h) The pursuit of or a successful action for provisional, interim,
additional or supplementary remedies, or the filing of a court action,
does not constitute a waiver of the right of the Borrower or the Bank,
including the suing party, to submit the controversy or claim to
arbitration if the other party contests the lawsuit.
(i) If the Bank forecloses against any real property securing this
Agreement, the Bank has the option to exercise the power of sale under
the deed of trust or mortgage, or to proceed by judicial foreclosure.
Waivers. If any part of this Agreement is not enforceable, the rest of the
Agreement may be enforced. The Bank retains all rights, even if it makes a
loan after default. If the Bank waives a default, it may enforce a later
default. Any consent or waiver under this Agreement must be in writing.
14.6 COSTS. If the Bank incurs any expenses in connection with enforcing
this Agreement or administering this Agreement (including in connection with
extending, amending, renewing or modifying this Agreement), or if the Bank
takes collection action under this Agreement, it is entitled to costs and
reasonable attorneys' fees, including any allocated costs of in-house counsel.
14.7 ATTORNEYS' FEES. In the event of a lawsuit or arbitration proceeding,
the prevailing party is entitled to recover costs and reasonable attorneys'
fees (including any allocated costs of in-house counsel) incurred in
connection with the lawsuit or arbitration proceeding, as determined by the
court or arbitrator (and not by a jury). Such costs and attorneys' fees shall
include, without limitation, those incurred on any appeal, as determined by
the appellate court, and any anticipated costs and attorneys' fees to pursue
or collect any judgement.
14.8 ONE AGREEMENT. This Agreement and any related security or other
agreements required by this Agreement, collectively:
(a) represent the sum of the understandings and agreements between the Bank
and the Borrower concerning this credit; and
(b) replace any prior oral or written agreements between the Bank and the
Borrower concerning this credit; and
(c) are intended by the Bank and the Borrower as the final, complete and
exclusive statement of the terms agreed to by them.
In the event of any conflict between this Agreement and any other agreements
required by this Agreement, this Agreement will prevail.
14.9 EXCHANGE OF INFORMATION. The Borrower agrees that the Bank may
exchange financial information about the Borrower with BankAmerica
Corporation affiliates and other related entities.
14.10 NOTICES. All notices required under this Agreement shall be personally
delivered or sent by first class mail, postage prepaid, to the addresses on
the signature page of this Agreement, or to such other addresses as the Bank
and the Borrower may specify from time to time in writing.
14.11 HEADINGS. Article and paragraph headings are for reference only and
shall not affect the interpretation or meaning of any provisions of this
Agreement.
14.12 COUNTERPARTS. This Agreement may be executed in as many counterparts
as necessary or convenient, and by the different parties on separate
counterparts each of which, when so executed, shall be deemed an original but
all such counterparts shall constitute but one and the same agreement.
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14.12 WRITTEN AGREEMENTS. UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND
COMMITMENTS MADE BY THE BANK AFTER OCTOBER 3, 1989, CONCERNING LOANS AND
OTHER CREDIT EXTENSIONS WHICH ARE NOT FOR PERSONAL, FAMILY OR HOUSEHOLD
PURPOSES OR SECURED SOLELY BY THE BORROWER'S RESIDENCE MUST BE IN WRITING,
EXPRESS CONSIDERATION AND BE SIGNED BY THAT BANK TO BE ENFORCEABLE.
This Agreement is executed as of the date stated at the top of the first page.
[LOGO]
BANK OF AMERICA NT & SA CLAREMONT TECHNOLOGY GROUP, INC.
X /s/ Robert Countryman X /s/ Terry D. Murphy
- ---------------------------------- -------------------------------------
By: Robert Countryman By: Terry D. Murphy
Title: Vice President Title: Secretary/Vice President Finance
ADDRESS WHERE NOTICES TO THE BANK ADDRESS WHERE NOTICES TO THE BORROWER
ARE TO BE SENT: ARE TO BE SENT:
Oregon Commercial Banking #2090 1600 NW Compton Drive
P.O. Box 6400 Beaverton, Oregon 97006
Portland, Oregon 97228
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