Exhibit 10.7
[LOGO]
IMPERIAL BANK
Member FDIC
CORPORATE RESOLUTION REGARDING CREDIT
Office: Santa Clara Valley Regional ADDRESS: 226 Airport Parkway
San Jose, California 95110
Resolved, that GENESYS TELECOMMUNICATIONS LABORATORIES borrow from IMPERIAL
BANK, hereinafter referred to as "Bank", from time to time, such sums of money
as, in the judgement of the officer or officers hereinafter authorized, this
corporation may require; provided that the aggregate amount of such borrowing,
pursuant to this resolution, shall not at any one time exceed the principal sum
of Three Million and No/100 DOLLARS ($3,000,000.00), in addition to such amount
as may be otherwise authorized;
RESOLVED FURTHER, that any 1 of the following named officers
----------------
(Specify Number)
Greg Shenkman the President
- ---------------------------------- ------------------------------------
Seth Homayoon the COO
- ---------------------------------- ------------------------------------
Alec Miloslavsky the VP Engineering
- ---------------------------------- ------------------------------------
Michael McCloskey the CFO
- ---------------------------------- ------------------------------------
the
- ---------------------------------- ------------------------------------
of this corporation (the officer or officers acting in combination, authorized
to act pursuant hereto being hereinafter designated as "authorized officers"),
be and they are hereby authorized, directed and empowered, for and on behalf and
in the name of this corporation (1) to execute and deliver to the Bank such
notes or other evidences of indebtedness of this corporation for the monies so
borrowed, with interest thereon, as the Bank may require, and to execute and
deliver, from time to time, renewals or extensions of such notes or other
evidences of indebtedness; (2) to grant a security interest in, transfer, or
otherwise hypothecate or deed in trust for Bank's benefit and deliver by such
instruments in writing or otherwise as may be demanded by the Bank, any of the
property of this corporation as may be required by the Bank to secure the
payment of any notes or other indebtedness of this corporation or third parties
to the Bank, whether arising pursuant to this resolution or otherwise; and (3)
to perform all acts and execute and deliver all instruments which the Bank may
deem necessary to carry out the purposes of this resolution;
RESOLVED FURTHER, that said authorized officers be and they are hereby
authorized and empowered, and that any one of said authorized officers be and
he/she is hereby authorized and empowered (1) to discount with or sell to the
Bank conditional sales contracts, notes, acceptances, drafts, bailment
agreements, leases, receivables and evidences of indebtedness payable to this
corporation, upon such terms as may be agreed upon by them and the Bank, and to
endorse in the name of this corporation said notes, acceptances, drafts,
bailment agreements, leases, receivables and evidences of indebtedness so
discounted, and to guarantee the payment of the same to the Bank, and (2) to
apply for and obtain from the Bank letters of credit and in connection therewith
to execute such agreement, applications, guarantees, indemnities and other
financial undertakings as Bank may require;
RESOLVED FURTHER, that said authorized officers are also authorized to
direct the disposition of the proceeds of any such obligation, and to accept or
direct delivery from the Bank of any property of this corporation at any time
held by the Bank;
RESOLVED FURTHER, that the authority given hereunder shall be deemed
retroactive and any and all acts authorized hereunder performed prior to the
passage of this resolution are hereby ratified and affirmed;
RESOLVED FURTHER, that this resolution will continue in full force and
effect until the Bank shall receive official notice in writing from this
corporation of the revocation thereof by a resolution duly adopted by the Board
of Directors of this corporation, and that the certification of the Secretary of
this corporation as the signatures of the above named persons shall be binding
on this corporation.
I, Richard DeGolia, Secretary of the above named corporation, duly
organized and existing under the laws of the State of California, do hereby
certify that the foregoing is a full, true and correct copy of a resolution of
the Board of Directors of said corporation, duly and regularly passed and
adopted by the Board of Directors of said corporation.
I further certify that said resolution is still in full force and effect
and has not been amended or revoked, and that the specimen signatures appearing
below are the signatures of the officers authorized to sign for this corporation
by virtue of said resolution.
EXECUTED ON 10/28/96
AUTHORIZED SIGNATURES
Signature: /s/ Greg Shenkman
----------------------------
Greg Shenkman
Signature: /s/ Seth Homayoon /s/ Richard C. DeGolia
---------------------------- -------------------------------
Seth Homayoon (Secretary)
Richard DeGolia
Signature: /s/ Alec Miloslavsky
----------------------------
Alec Miloslavsky
Signature: /s/ Michael McCloskey
----------------------------
Michael McCloskey
Signature:
----------------------------
[LOGO]
IMPERIAL BANK
Member FDIC
226 Airport Parkway
San Jose, California October 28, 1996
Subject: Credit Terms and Conditions ("Agreement")
Borrower: Genesys Telecommunications Laboratories
Gentlemen:
To induce you to make loans to the undersigned (herein called "Borrower"), and
in consideration of any loan or loans to you, in your sole discretion, may make
to Borrower, Borrower warrants and agrees as follows:
A. Borrower represents and warrants that:
1. EXISTENCE AND RIGHTS.
Company is a corporation
Borrower is duly organized and existing and in good standing under the laws of
the State of California and is authorized and in good standing to do business in
the State of California. Borrower has powers and adequate authority, rights and
franchises to own its property and to carry on its business as now conducted,
and is duly qualified and in good standing in each State in which the character
of the properties owned by it therein or the conduct of its business makes such
qualification necessary, and Borrower has the power and adequate authority to
make and carry out this Agreement, Borrower has no investment in any other
business entity, except as previously disclosed to Bank.
2. AGREEMENT AUTHORIZED. The execution, delivery and performance of this
Agreement are duly authorized and do not require the consent or approval of any
governmental body or other regulatory authority; are not in contravention of or
in conflict with any law or regulation or any term or provision of Borrower's
articles of incorporation, by-laws, or Articles of Association, as the case may
be, and this Agreement is the valid, binding and legally enforceable obligation
of Borrower in accordance with its terms.
3. NO CONFLICT. The execution, delivery and performance of this
Agreement are not in contravention of or in conflict with any agreement,
indenture or undertaking to which Borrower is a party or by which it or any of
its property may be bound or affected, and do not cause any lien, charge or
other encumbrance to be created or imposed upon any such property by reason
thereof.
4. LITIGATION. There is no litigation or other proceeding pending or
threatened against or affecting Borrower, and Borrower is not in default with
respect to any order, writ, injunction, decree or demand of any court or other
governmental or regulatory authority.
5. FINANCIAL CONDITION. The balance sheet of Borrower as of 6/30/96, and
the related profit and loss statement for the year ended on that date, a copy of
which has heretofore been delivered to you by Borrower, and all other statements
and data submitted in writing by Borrower to you in connection with this request
for credit are true and correct, and said balance sheet and profit and loss
statement truly present the financial condition of Borrower as of the date
thereof and the results of the operations of Borrower for the period covered
thereby, and have been prepared in accordance with generally accepted accounting
principles on a basis consistently maintained. Since such date there have been
no materially adverse changes in the financial condition or business of
Borrower. Borrower has no knowledge of any liabilities, contingent or
otherwise, at such date not reflected in said balance sheet, and Borrower has
not entered into any special commitments or substantial contracts which are
not reflected in said balance sheet, other than in the ordinary and normal
course of its business, which may have a materially adverse effect upon its
financial condition, operations or business as now conducted.
6. TITLE TO ASSETS. Borrower has good title to its assets and the same
are not subject to any liens or encumbrances other than those permitted by
Section C.3 hereof.
7. TAX STATUS. Borrower has no liability for any delinquent state, local
or federal taxes, and if Borrower has contracted with any government agency,
Borrower has no liability for renegotiation of profits.
8. TRADEMARKS, PATENTS. Borrower, as of the date hereof, possesses all
necessary trademarks, trade names, copyrights, patents, patent rights, and
licenses to conduct its business as now operated, without any known conflict
with the valid trademarks, trade names, copyrights, patents and license rights
of others.
9. REGULATION U. The proceeds of this loan shall not be used to purchase
or carry margin stock (as defined with Regulation U of the Board of Governors of
the Federal Reserve System).
B. Borrower agrees that so long as it is indebted to you, it will, unless you
shall otherwise consent in writing:
1. RIGHTS AND FACILITIES. Maintain and preserve all rights, franchises
and other authority adequate for the conduct of its business; maintain its
properties, equipment and facilities in good order and repair; conduct its
business in an orderly manner without voluntary interruption and, if a
corporation or partnership, maintain and preserve its existence.
2. INSURANCE. Maintain public liability, property damage and workers'
compensation insurance and insurance on all its insurable property against fire
and other hazards with responsible insurance carriers to the extent usually
maintained by similar businesses.
3. TAXES AND OTHER LIABILITIES. Pay and discharge, before the same
become delinquent and before penalties accrue thereon, all taxes, assessments
and governmental charges upon or against it or any of its properties, and all
its other liabilities at any time existing, except to the extent and so long as:
(a) The same are being contested in good faith and by appropriate proceedings
in such manners as not to cause any materially adverse effect upon its financial
condition or the loss of any right of redemption from any sale thereunder, and
(b) it shall have set aside on its books reserves (segregated to the extent
required by generally accepted accounting practice) deemed by it adequate with
respect thereto.
4. RECORDS AND REPORTS. Maintain a standard and modern system of
accounting in accordance with generally accepted accounting principles on a
basis consistently maintained; permit your representatives to have access to,
and to examine its properties, books and records at all reasonable times; and
furnish you:
(a) As soon as available, and in any event within 30 days after the close of
each month of each fiscal year of Borrower, commencing with the month next
ending, a balance sheet, profit and loss statement and reconciliation of
Borrower's capital accounts as of the close of such period and covering
operations for the portion of Borrower's fiscal year ending on the last day of
such period, all in reasonable detail and stating in comparative form the
figures for the corresponding date and period in the previous fiscal year,
prepared in accordance with generally accepted accounting principles on a basis
consistently maintained by Borrower and certified by an appropriate officer of
Borrower, subject, however, to year-end audit adjustments;
(b) As soon as available, and in any event within 150 days after the close of
each fiscal year of Borrower, a report of audit of Company as of the close of
and for such fiscal year, all in reasonable detail and stating in comparative
form the figures as of the close of and for the previous fiscal year, with the
unqualified opinion of accountants satisfactory to you.
(c) Within 30 days after the close of each month of each fiscal month of
Borrower, a certificate by chief financial officer or partner of Borrower,
stating that Borrower has performed and observed each and every covenant
contained in this Letter of Inducement to be performed by it and that no event
has occurred and no condition then exists which constitutes an event of default
hereunder or would constitute such an event of default upon the lapse of time or
upon the giving of notice and the lapse of time specified herein or, if any such
event has occurred or any such condition exists, specifying the nature thereof;
(d) Promptly after the receipt thereof by Borrower, copies of any detailed
audit reports submitted to Borrower by independent accountants in connection
with each annual or interim audit of the accounts of Borrower made by such
accountants;
(e) Promptly after the same are available, copies of all such proxy statements,
financial statements and reports as Borrower shall send to its stockholders, if
any, and copies of all reports which Borrower may file with the Securities and
Exchange Commission or any governmental authority at any time substituted
therefor; and
(f) Such other information relating to the affairs of Borrower as you
reasonably may request from time to time.
(g) Notice of Default. Promptly notify the Bank in writing of the occurrence
of any event of default hereunder or any event which upon notice and lapse of
time would be an event of default.
C. Borrower agrees that so long as it is indebted to you, it will not, without
your written consent:
1. TYPE OF BUSINESS; MANAGEMENT. Make any substantial change in the
character of its business;
2. OUTSIDE INDEBTEDNESS. Create, incur, assume or permit to exist any
indebtedness for borrowed moneys other than loans from you except: (a)
Obligations now existing as shown in financial statement dated 6/30/96,
excluding those being refinanced by your bank
(b) Indebtedness subordinated to the indebtedness to you on
terms and conditions reasonably satisfactory to you;
(c) Indebtedness of Borrower to any of its subsidiaries;
(d) Indebtedness secured by Permitted Liens (as defined in the
Security and Loan Agreement; and
(e) Other Indebtedness in an amount not exceeding $100,000 in
the aggregate outstanding at any time; or sell or transfer, either with or
without recourse, any accounts or notes receivable or any moneys due to become
due.
3. LIENS AND ENCUMBRANCES. Create, incur, or assume any mortgage, pledge
encumbrance, lien or charge of any kind (including the charge upon property at
any time purchased or acquired under conditional sale or other title retention
agreement) upon any asset now owned or hereafter acquired by it, other than
liens for taxes not delinquent and liens in your favor and other than Permitted
Liens.
4. LOANS, INVESTMENTS, SECONDARY LIABILITIES. Make any loans or advances
to any person or other entity other than in the ordinary and normal course of
its business as now conducted or make any investment in the securities of any
person or other entity other than the United States Government; or guarantee or
otherwise become liable upon the obligation of any person or other entity,
except: (a) By endorsement of negotiable instruments for deposit or collection
in the ordinary and normal course of its business (b) (i) Marketable direct
obligations issued or unconditionally guaranteed by the United States of America
or any agency or any State thereof maturing within one (1) year from the date of
acquisition thereof, (ii) commercial paper maturing no more than 270 days from
the date of creation thereof and currently having the highest rating obtainable
from either Standard & Poor's Corporation or Moody's Investors Service, Inc.,
(iii) certificates of deposit maturing no more than one (1) year from the date
of investment therein issued by Bank, and (iv) any Investments permitted by
Borrower's investment policy, a amended from time to time, provided that such
investment policy (and any such amendment thereto) has been approved by the
Bank, which approval shall not be unreasonably withheld;
(c) Investments (whether consisting of the purchase of securities,
loans, capital contributions or otherwise) of Borrower in or to subsidiaries and
investments by Borrower in or to companies which simultaneously with such
investments become subsidiaries, provided that the sum of (i) all such
investments by Borrower in or to Subsidiaries, plus (ii) guarantees by Borrower
outstanding at any time with respect to the obligations of subsidiaries, minus
the sum of (x) investments by Subsidiaries in or to Borrower, plus (y) payments
to Borrower on account of investments of Borrower in or to Subsidiaries, plus
(z) distributions or dividends by Subsidiaries to Borrower, in each case, made,
incurred or arising on or after the date hereof does not exceed $750,000.
(d) Receivables owing to Borrower or its subsidiaries and advances to
customers or suppliers, in each case, if created, acquired or made in the
ordinary course of business;
(e) Loans and advances consisting (i) travel advances, employee
relocation loans and other employee loans and advances in the ordinary course of
business, (ii) loans to employees, officers or directors.
relating to the purchase of equity securities of Borrower, (iii) other loans to
officers and employees approved by the Board of Directors in an aggregate amount
not in excess of $250,000 outstanding at any time;
(f) Investments (including debt obligations) received in connection
with the bankruptcy or reorganization of customers or suppliers and in
settlement of delinquent obligations of, and other disputes with, customers or
suppliers arising in the ordinary course of business;
(g) Investments consisting of notes receivable of, or prepaid
royalties and other credit extensions to, customers and suppliers who are not
Affiliates in the ordinary course of business;
(h) Investments constituting acquisitions permitted hereunder;
(i) Deposit accounts of Borrower maintained in the ordinary course
of business; and
(j) Other Investments aggregating not in excess of $250,000 at any
time.
5. ACQUISITION OR SALE OF BUSINESS: MERGER OR CONSOLIDATION. Purchase
or otherwise acquire the assets of business of any person or other entity; or
liquidate, dissolve, merge or consolidate, or commence any proceedings therefor;
or sell any assets except in the ordinary and normal course of its business as
now conducted; or sell, lease, assign, or transfer any substantial part of its
business or fixed assets, or any property or other assets necessary for the
continuance of its business as now conducted including without limitation the
selling of any property or other asset accompanied by the leasing back of the
same; provided, that:
---------
(a) Borrower may sell and leaseback equipment within 90 days of
its original purchase;
(b) Borrower may sell other assets for cash outside the ordinary
course of business in an amount not exceeding $500,000 in any fiscal year;
(c) Borrower may purchase the assets or business of other entities
for cash in an amount not exceeding $500,000 in any fiscal year or for stock in
a transaction valued at not more than $5,000,000; and
(d) Borrower may merge with any subsidiary so long as it is the
surviving corporation.
6. DIVIDENDS, STOCK PAYMENTS. If a corporation, declare or pay any
dividend (other than dividends payable in common stock of Borrower) or make any
other distribution on any of its capital stock now outstanding or hereafter
issued or purchase, redeem or retire any of such stock, provided, that:
--------
(a) Borrower may convert any of its convertible securities into other
securities pursuant to the terms of such convertible securities or otherwise in
exchange therefor, and
(b) Borrower may redeem or repurchase its in connection with any
agreement between Borrower and any officer, director, employee or consultant of
Borrower entered into in the ordinary course of business wherein Borrower is
obligated or entitled to repurchase from such officer, director, employee or
consultant shares of equity securities of Borrower upon such person's
termination of employment or services or other event.
D. The occurrence of any one of the following events of default shall, at your
option, terminate the commitment to lend and make all sums of principal and
interest then remaining unpaid on all Borrower's indebtedness to you immediately
due and payable, all without demand, presentment or notice, all of which are
hereby expressly waived:
1. FAILURE TO PAY NOTE. Failure to pay any installment of principal or of
interest on any indebtedness of Borrower to you and such failure shall continue
for three (3) business days after receipt of notice thereof
2. BREACH OF COVENANT. Failure of Borrower to perform any other term or
condition of this Agreement binding upon Borrower and such failure shall
continue for fifteen (15) days after an officer of Borrower becomes aware
thereof
3. BREACH OF WARRANTY. Any of Borrower's representations or warranties
made herein or any statement or certificate at any time given in writing
pursuant hereto or in connection herewith shall be false or misleading in any
respect.
4. INSOLVENCY: RECEIVER OR TRUSTEE. Borrower shall become insolvent; or
admit its inability to pay its debts as they mature; or make an assignment for
the benefit of creditors; or apply for or consent to the appointment of a
receiver or trustee for it or for a substantial part of its property or
business.
5. JUDGMENTS, ATTACHMENTS. Any money judgment, writ or warrant of
attachment, or similar process shall be entered or filed against Borrower or any
of its assets and shall remain unvacated, unbonded or unstayed for a period of
10 days or in any event later than five days prior to the date of any proposed
sale thereunder.
6. BANKRUPTCY. Bankruptcy, insolvency, reorganization or liquidation
proceedings or other proceedings for relief under any bankruptcy law or any law
for the relief of debtors shall be instituted by or against Borrower and, if
instituted against it, shall be consented to.
E. MISCELLANEOUS PROVISIONS.
1. FAILURE OR INDULGENCE NOT WAIVER. No failure or delay on the part of
your Bank or any holder of Notes issued hereunder, in the exercise of any power,
right or privilege hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other right, power or privilege. All
rights and remedies existing under this agreement or any note issued in
connection with a loan that your Bank may make hereunder, are cumulative to, and
not exclusive of, any rights or remedies otherwise available.
See addendum dated October 28, 1996, and Inserts attached hereto and
incorporated herein by this reference for additional terms. In the event of a
conflict between this Agreement and the Addendum and/or Inserts, the terms in
the Addendum and/or Inserts prevail.
Genesys Telecommunications Laboratories
By /s/ Michael McCloskey
----------------------------------------
(Authorized Signature and Title)
GENESYS TELECOMMUNICATIONS LABORATORIES
ADDENDUM TO CREDIT TERMS & CONDITIONS
DATED OCTOBER 28, 1996
BORROWING BASE
- --------------
A) In accordance with the attached loan documents, advances under the line of
credit ("Line") will be limited to the lesser of: (i) 80% (subject to audit
results) of Eligible Accounts receivable (as hereinafter defined), or (ii)
$2,500,000. Line to include a $500,000 sublimit for the issuance of trade-
related standby and commercial letters of credit. As used herein,
"Eligible Accounts" shall be defined as: Borrower's accounts receivable
which are outstanding less than 90 days from invoice, with certain
exclusions for foreign (unless approved in writing by Bank), government,
contra, and inter-company accounts. Any account which alone exceeds more
than 25% of Borrower's total accounts receivable will have the amount in
excess of 25% excluded, and any account with more than 25% of the account
outstanding more than 90 days from invoice will be excluded.
B) In accordance with the attached loan documents, advances under the
equipment loan ("Term Loan") will be limited to a maximum of 90% of
submitted invoices less tax and freight. Term Loan includes an interest
only drawdown period ending 3/31/97 (in accordance with the terms and
conditions of the Note dated October 28, 1996). After 3/31/97, the
outstanding balance will be amortized on a thirty-six month basis with
principal and interest to be paid on a monthly basis.
FINANCIAL COVENANTS
- -------------------
Borrower to maintain on a fiscal monthly basis unless otherwise noted (covenants
apply to all loans):
1) A minimum Tangible Net Worth (defined as the financial statement net worth
of the Borrower prepared according to generally accepted accounting
principles less intangible assets, plus indebtedness fully subordinated to
the debt due to the Bank) greater than $6,000,000.
Beginning with the month ending 4/30/97, Borrower to maintain on a fiscal
monthly basis unless otherwise noted (covenants apply to all loans):
1) A minimum Quick Ratio (defined as cash and cash equivalents plus trade
accounts receivable to current liabilities) of 1.0:1.
2) A minimum Tangible Net Worth (defined as the financial statement net worth
of the Borrower prepared according to generally accepted accounting
principles less intangible assets, plus indebtedness fully subordinated to
the debt due to the Bank) greater than $6,500,000.
3) A maximum ratio of Total Liabilities (defined as all of the Borrower's
liabilities except for indebtedness fully subordinated to the debt due to
the Bank) less Deferred Revenues to Tangible Net Worth of 1.0:1.
4) Quarterly profitability required beginning with the quarter ending 9/30/97.
REPORTING
- ---------
Borrower to provide:
1) Unqualified audited financial statements within 150 days of fiscal year
end.
2) Beginning the earlier of: (i) 12/31/96, or (ii) five days prior to any
borrowing under the Line or Term Loan, Company prepared monthly financial
statements and Compliance Certificate within 30 days of each month end.
GENESYS TELECOMMUNICATIONS
LABORATORIES
Addendum to Credit Terms &
Conditions Dated October 28, 1996
Page Two
3) As a condition to any borrowing by Borrower, and at least 30 days prior to
the initial advance by Bank, monthly aged listings of accounts receivable
(to include customer addresses and telephone numbers) and accounts payable
along with a Borrowing Base Certificate in form and substance acceptable to
Bank within 20 days of each month end.
4) Budgets, sales projections, operating plans, or other financial exhibits
which Bank may reasonably request within five (5) business days after
Bank's request.
OTHER CONDITIONS
- ----------------
1) Borrower's primary banking relationship and accounts to be maintained at
Imperial Bank, including the operating account.
2) Borrower to notify Bank in writing of any legal action commenced against it
which, in the opinion of Borrower's counsel is reasonably likely to result
in damages over $50,000. Bank to be notified within fifteen (15) business
days after receipt by Borrower of written notice of the commencement of
such action.
3) As a condition to any borrowing by Borrower, Borrower to provide Bank proof
of insurance adequately covering all tangible corporate assets and a
Lender's Loss Payable Clause with Bank as beneficiary with respect to
Bank's collateral.
4) At its option and prior to any borrowing by Borrower, Bank may require an
annual accounts receivable audit by Bank's asset-based lending group at
Borrower's expense, with results satisfactory to Bank.
5) Prior to loan closing, Borrower shall execute and deliver to Bank any and
all documents required by Bank. Borrower to pay to Bank all reasonable fees
for loan documentation preparation, due at closing.
6) If any installment payment, interest payment, principal payment or
principal balance payment due hereunder is delinquent ten or more days,
Obligor agrees to pay Bank a late charge in the amount of 5% of the payment
so due and unpaid, in addition to the payment; but nothing in this
paragraph is to be construed as any obligation on the part of the holder of
this note to accept payment of any payment past due or less than the total
unpaid principal balance after maturity.
All payments shall be applied first to any late charges owing, then to
interest and the remainder, if any, to principal.
GENESYS TELECOMMUNICATIONS
LABORATORIES
By: /s/ Michael McCloskey
----------------------------------
Title: C.F.O.
--------------------------------
Date: 10/28/96
--------------------------------
IMPERIAL BANK
Member FDIC
SECURITY AND LOAN AGREEMENT
(ACCOUNTS RECEIVABLE)
This Agreement is entered into between GENESYS TELECOMMUNICATIONS LABORATORIES
, a Corporation
(herein called "Borrower") and IMPERIAL BANK (herein called "Bank").
1. Bank hereby commits, subject to all the terms and conditions of this
Agreement and prior to the termination of its commitment as hereinafter
provided, to make loans to Borrower from time to time in such amounts as may be
determined by Bank up to, but not exceeding in the aggregate unpaid principal
balance, the following Borrowing Base:
80% of Eligible Accounts
and in no event more than $2,500,000.
2. The amount of each loan made by Bank to Borrower hereunder shall be debited
to the loan ledger account of Borrower maintained by Bank (herein called "Loan
Account") and Bank shall credit the Loan Account with all loan repayments made
by Borrower. Borrower promises to pay Bank (a) the unpaid balance of Borrower's
Loan Account on demand and (b) on or before the tenth day of each month,
interest on the average daily unpaid balance of the Loan Account during the
immediately preceding month at the rate of No & 500/1000ths percent (0.500%) per
annum in excess of the rate of interest which Bank has announced as its prime
lending rate ("Prime Rate") which shall vary concurrently with any change in
such Prime Rate. Interest shall be computed at the above rate on the basis of
the actual number of days during which the principal balance of the loan account
is outstanding divided by 360, which shall for interest computation purposes be
considered one year. Bank at its option may demand payment of any or all of the
amount due under the Loan Account including accrued but unpaid interest in the
event of default. Such notice may be given verbally or in writing and should be
effective upon receipt by Borrower. The amount of interest payable each month
by Borrower shall not be less than a minimum monthly charge of $250.00. Bank is
hereby authorized to charge Borrower's deposit account(s) with Bank for all sums
due Bank under this Agreement.
3. Requests for loans hereunder shall be in writing duly executed by Borrower
in a form satisfactory to Bank and shall contain a certification setting forth
the matters referred to in Section 1, which shall disclose that Borrower is
entitled to the amount of loan being requested.
4. As used in this Agreement, the following terms shall have the following
meanings:
A. "Accounts" means any right to payment for goods sold or leased, or to be
sold or to be leased, or for services rendered or to be rendered no matter
how evidenced, including accounts receivable, contract rights, chattel
paper, instruments, purchase orders, notes, drafts, acceptances, general
intangibles and other forms of obligations and receivables,
B. "Collateral" means any and all personal property of Borrower which is
assigned or hereafter is assigned to Bank as security or in which Bank now
has or hereafter acquires a security interest.
C. "Eligible Accounts" means all of Borrower's Accounts excluding, however,
(1) all Accounts under which payment is not received within 90 days from
any invoice date, (2) all Accounts against which the account debtor or any
other person obligated to make payment thereon asserts any defense, offset,
counterclaim or other right to avoid or reduce the liability represented by
the Account and (3) any Accounts if the account debtor or any other person
liable in connection therewith is insolvent, subject to bankruptcy or
receivership proceedings or has made an assignment for the benefit of
creditors or whose credit standing is unacceptable to Bank and Bank has so
notified Borrower. Eligible Accounts shall only include such accounts as
Bank in its sole discretion shall determine are eligible from time to time.
D. "Permitted Liens" means any of the following:
(a) liens arising from judgments, attachments or similar proceedings
not constituting an Event of Default under Section D.5 of the Credit Terms
and Conditions;
(b) deposits or pledges made in connection with, or to secure payment
of, workmen's compensation, unemployment insurance, old age pensions or
other social security or similar obligations;
(d) liens of carriers, mechanics and materialmen and other like
liens in respect of obligations not overdue;
(e) such minor defects, irregularities, encumbrances, easements, rights
of way, and clouds on title as normally exist with respect to similar
properties which do not, individually or in the aggregate, materially
impair the property affected thereby for the purpose of which it was
acquired;
(f) liens of landlords or lessors under leases arising by
contract or operation of law;
(g) liens arising from purchase money obligations for tangible personal
property used in Borrower's business, and rights of lessors under capital
leases; provided that no such liens shall extend to any assets of Borrower
other than those financed by such a purchase money obligation or capital
lease (and accessions and additions thereto and replacements thereof and
the proceeds thereof);
(h) licenses granted to third parties the granting of which does
not result in a material adverse effect on the business of Borrower;
(i) liens in favor of customs and revenue authorities which secure
payment of customs duties in connection with the importation of goods;
(j) liens securing reimbursement obligations of Borrower under
documentary letters of credit; provided that such liens shall attach
--------
only to documents relating to such letters of credit, goods covered
thereby and products and proceeds thereof;
(k) liens which constitute rights of set-off of a customary nature or
bankers' liens on amounts on deposit, whether arising by contract or by
operation of law, in connection with arrangements entered into with
depository institutions in the ordinary course of business; and
(l) liens for taxes, fees, assessments or other governmental charges
or levies, either not delinquent or being contested in good faith by
appropriate proceedings, provided the same have no priority over any
--------
of Bank's security interests;
(m) liens in favor of Bank.
5. Borrower hereby assigns to Bank all Borrower's present and future Accounts,
including all proceeds due thereunder, all guaranties and security therefor, and
hereby grants to Bank a continuing security interest in all moneys in the
Collateral Account referred to in Section 6 hereof as security for any and all
obligations of Borrower to Bank, whether now owing or hereafter incurred and
whether direct, indirect, absolute or contingent. So long as Borrower is
indebted to Bank or Bank is committed to extend credit to Borrower, Borrower
will execute and deliver to Bank such assignments, including Bank's standard
forms of Specific or General Assignment covering individual Accounts, notices,
financing statements, and other documents and papers as Bank may require in
order to affirm, effectuate or further assure the assignment to Bank of the
Collateral or to give any third party, including the account debtors obligated
on the Accounts, notice of Bank's interest in the Collateral.
6. Until Bank exercises its rights to collect the Accounts pursuant to
paragraph 10. Borrower will collect with diligence all Borrower's Accounts. Any
collection of Accounts by Borrower, whether in the form of cash, checks, notes,
or other instruments for the payment of
money (properly endorsed or assigned where required to enable Bank to collect
same), shall be in trust for Bank. If an Event of Default has occurred,
Borrower shall keep all such collections separate and apart from all other funds
and property so as to be capable of identification as the property of Bank and
deliver said collections daily to Bank in the identical form received. The
proceeds of such collections when received by Bank may be applied by Bank
directly to the payment of Borrower's Loan Account or any other obligation
secured hereby. Any credit given by Bank upon receipt of said proceeds shall be
conditional credit subject to collection. Returned items collected by Bank
after an Event of Default may, at Bank's option, be charged to Borrower's
general account. All collections of the Accounts shall be set forth on an
itemized schedule, showing the name of the account debtor, the amount of each
payment and such other information as Bank may request.
7. Until Bank exercises its rights to collect the Accounts pursuant to
paragraph 10, Borrower may continue its present policies with respect to
returned merchandise and adjustments. However, Borrower shall immediately
notify Bank of all cases involving returns, repossessions, and loss or damage of
or to merchandise represented by the Accounts and of any credits, adjustments or
disputes arising in connection with the goods or services represented by the
Accounts and, in any of such events, Borrower will immediately pay to Bank from
its own funds (and not from the proceeds of Accounts or Inventory) for
application to Borrower's Loan Account or any other obligation secured hereby
the amount of any credit for such returned or repossessed merchandise and
adjustments made to any of the Accounts.
8. Borrower represents and warrants to Bank: (i) If Borrower is a corporation,
that Borrower is duly organized and existing in the State of its incorporation
and the execution, delivery and performance hereof are within Borrower's
corporate powers, have been duly authorized and are not in conflict with law or
the terms of any charter, by-law or other incorporation papers, or of any
indenture, agreement or undertaking to which Borrower is a party or by which
Borrower is found or affected; (ii) Borrower is, or at the time the collateral
becomes subject to Bank's security interest will be, the true and lawful owner
of and has, or at the time the Collateral becomes subject to Bank's security
interest will have, good and clear title to the Collateral, subject only to
Bank's rights therein; (iii) Each Account is, or at the time the Account comes
into existence will be, a true and correct statement of a bona fide indebtedness
incurred by the debtor named therein in the amount of the Account for either
merchandise sold or delivered (or being held subject to Borrower's delivery
instructions) to, or services rendered, performed and accepted by, the account
debtor; (iv) that there are or will be no defenses, counterclaims, or setoffs
which may be asserted against the Accounts; and (v) any and all financial
information, including information relating to the Collateral, submitted by
Borrower to Bank, whether previously or in the future, is or will be true and
correct.
9. Borrower will: (i) Furnish Bank from time to time such financial statements
and information as Bank may reasonably request and inform Bank immediately upon
the occurrence of a material adverse change therein; (ii) Furnish Bank
periodically, in such form and detail and at such times as Bank may require,
statements showing aging and reconciliation of the Accounts and collections
thereon; (iii) Permit representatives of Bank to inspect the Borrower's books
and records relating to the Collateral and make extracts therefrom at any
reasonable time and to arrange for verification of the Accounts, under
reasonable procedures, acceptable to Bank, directly with the account debtors or
otherwise at Borrower's expense; (iv) Promptly notify Bank of any attachment or
other legal process levied against any of the Collateral and any information
received by Borrower relative to the Collateral, including the Accounts, the
account debtors or other persons obligated in connection therewith, which may in
any way affect the value of the Collateral or the rights and remedies of Bank in
respect thereto; (v) Reimburse Bank upon demand for any and all legal costs,
including reasonable attorneys' fees, and other expense incurred in collecting
any sums payable by Borrower under Borrower's Loan Account or any other
obligation secured hereby, enforcing any term or provision of this Security
Agreement or otherwise or in the checking, handling and collection of the
Collateral and the preparation and enforcement of any agreement relating
thereto; (vi) Notify Bank of each location and of each office of Borrower at
which records of Borrower relating to the Accounts are kept; (vii) Provide,
maintain and deliver to Bank policies insuring the Collateral against loss or
damage by such risks and in such amounts, forms and companies as Bank may
require and with loss payable solely to Bank, and, in the event Bank takes
possession of the Collateral, the insurance policy or policies and any unearned
or returned premium thereon shall at the option of Bank become the sole property
of Bank, such policies and the proceeds of any other Insurance covering or in
any way relating to the Collateral, whether now in existence or hereafter
obtained, being hereby assigned to Bank; and (viii) In the event the unpaid
balance of Borrower's Loan Account shall exceed the maximum amount of
outstanding loans to which Borrower is entitled under Section 1 hereof, Borrower
shall immediately pay to Bank, from its own funds and not from the proceeds of
Collateral, for credit to Borrower's Loan Account the amount of such excess.
10. After and during the continuance of an Event of Default Bank may, without
prior notice to Borrower, collect the Accounts and may give notice of assignment
to any and all account debtors, and Borrower does hereby make, constitute and
appoint Bank its irrevocable, true and lawful attorney with power to receive,
open and dispose of all mail addressed to Borrower, to endorse the name of
Borrower upon any checks or other evidences of payment that may come into the
possession of Bank upon the Accounts to endorse the name of the undersigned upon
any document or instrument relating to the Collateral; in its name or otherwise,
to demand, sue for, collect and give acquittances for any and all moneys due or
to become due upon the Accounts; to compromise, prosecute or defend any action,
claim or proceeding with respect thereto; and to do any and all things necessary
and proper to carry out the purpose herein contemplated.
11. Until Borrower's Loan Account and all other obligations secured hereby
shall have been repaid in full, Borrower shall not sell, dispose of or grant a
security interest in any of the Collateral other than to Bank, or execute any
financing statements covering the Collateral in favor of any secured party or
person other than Bank.
12. Upon the occurrence, and during the continuance, of an Event of Default (as
defined in the Credit Terms and Conditions) Bank may, at its option and without
demand first made and without notice to Borrower, do any one or more of the
following: (a) Terminate its obligation to make loans to Borrower as provided in
Section 1 hereof; (b) Declare all sums secured hereby immediately due and
payable; (c) Immediately take possession of the Collateral wherever it may be
found, using all necessary force so to do, or require Borrower to assemble the
Collateral and make it available to Bank at a place designated by Bank which is
reasonably convenient to Borrower and Bank, and Borrower waives all claims for
damages due to or arising from or connected with any such taking; (d) Proceed in
the
foreclosure of Bank's security interest and sale of the Collateral in any manner
permitted by law, or provided for herein; (e) Sell, lease or otherwise dispose
of the Collateral at public or private sale, with or without having the
Collateral at the place of sale, and upon terms and in such manner as Bank may
determine, and Bank may purchase same at any such sale; (f) Retain the
Collateral in full satisfaction of the obligations secured thereby; (g) Exercise
any remedies of a secured party under the Uniform Commercial Code. Prior to any
such disposition, Bank may, at its option, cause any of the Collateral to be
repaired or reconditioned in such manner and to such extent as Bank may deem
advisable, and any sums expanded therefor by Bank shall be repaid by Borrower
and secured hereby. Bank shall have the right to enforce one or more remedies
hereunder successively or concurrently, and any such action shall not estop or
prevent Bank from pursuing any further remedy which it may have hereunder or by
law. If a sufficient sum is not realized from any such disposition of Collateral
to pay all obligations secured by this Security Agreement, Borrower hereby
promises and agrees to pay Bank any deficiency.
14. Borrower authorizes Bank to destroy all invoices, delivery receipts,
reports and other types of documents and records submitted to Bank in connection
with the transactions contemplated herein at any time subsequent to four months
from the time such items are delivered to Bank.
15. Nothing herein shall in any way limit the effect of the conditions set
forth in any other security or other agreement executed by Borrower, but each
and every condition hereof shall be in addition thereto.
16. Additional Provisions: Subject to conditions and limitations contained in
the Credit Terms and Conditions dated October 28, 1996.
Executed this 28th day of October, 1996
GENESYS TELECOMMUNICATIONS LABORATORIES
-----------------------------------------
(Name of Borrower)
By: /s/ Michael McCloskey
____________________________________
IMPERIAL BANK (Authorized Signature and Title)
By: By:
- ----------------------------- ------------------------------------
(Authorized Signature and Title)
SECURITY AGREEMENT (CONTINUED)
Obligor represents, warrants and agrees:
1. Obligor will immediately pay (a) any Debt when due, (b) Bank's costs
of collecting the Debt, of protecting, insuring or realizing on Collateral, and
any expenditure of Bank pursuant hereto, including attorneys' fees and expenses,
with interest at the rate of 24% per year, or the rate applicable to the Debt,
whichever is less, from the date of expenditure, and (c) any deficiency after
realization of Collateral.
2. Obligor will use the proceeds of any loan that becomes Debt hereunder
for the purpose indicated on the application therefore, and will promptly
contract to purchase and pay the purchase price of any property which becomes
Collateral hereunder from the proceeds of any loan made for that purpose.
3. As to all Collateral in Obligor's possession (unless specifically
otherwise agreed to by Bank in writing), Obligor will:
(a) Have, or has, possession of the Collateral at the location
disclosed to Bank and will not remove the Collateral from the
location.
(b) Keep the Collateral separate and identifiable.
(c) Maintain the Collateral in good and saleable condition, repair it
if necessary, clean, feed, shelter, water, medicate, fertilize,
cultivate, irrigate, prune and otherwise deal with the Collateral in
all such ways as are considered good practice by owners of like
property, use it lawfully and only as permitted by insurance policies,
and permit Bank to inspect the Collateral at any reasonable time.
(d) Not sell, contract to sell, lease, encumber or transfer the
Collateral (other than inventory Collateral) until the Debt has been
paid, even though Bank has a security interest in proceeds of such
Collateral.
4. As to Collateral which is inventory and accounts, Obligor:
(a) May, until notice from Bank, sell, lease or otherwise dispose of
inventory Collateral in the ordinary course of business only, and
collect the cash proceeds thereof.
(b) Will, upon notice from Bank, deposit all cash proceeds as
received in a demand deposit account with Bank, containing only such
proceeds and deliver statements identifying units of inventory
disposed of, accounts which gave rise to proceeds, and all
acquisitions and returns of inventory as required by Bank
(c) Will receive in trust, schedule on forms satisfactory to the Bank
and deliver to Bank all non-cash proceeds other than inventory
received in trade.
(d) If not in default, may obtain release of Bank's interest in
individual units of inventory upon request, therefore, payment to Bank
of the release price of such units shown on any Collateral schedule
supplementary hereto, and compliance herewith as to proceeds thereof.
5. As to Collateral which are accounts, chattel paper, general
intangibles and proceeds described in 4(c) above, Obligor warrants, represents
and agrees:
(a) All such Collateral is genuine, enforceable in accordance with
its terms, free from default, prepayment, defense and conditions
precedent (except as disclosed to and accepted by Bank in writing),
and is supported by consecutively numbered invoices to, or rights
against, the debtors thereon. Obligor will supply bank with duplicate
invoices or other evidence of Obligor's rights on Bank's request;
(b) All persons appearing to be obligated on such Collateral have
authority and capacity to contract;
(c) All chattel paper is in compliance with law as to form, content
and manner of preparation and execution and has been properly
registered, recorded, and/or filed to protect Obligor's interest
thereunder;
(d) If an account debtor shall also be indebted to Obligor on another
obligation, any payment made by him not specifically designated to be
applied on any particular obligation shall be considered to be a
payment on the account in which Bank has a security interest. Should
any remittance include a payment not on an account, it shall be
delivered to Bank and, if no event of default has occurred, Bank shall
pay Obligor the amount of such payment;
(e) Obligor agrees not to compromise, settle or adjust any account or
renew or extend the time of payment thereof without Bank's prior
written consent.
6. Obligor owns all Collateral absolutely, and no other person has or
claims any interest in any Collateral, except as disclosed to and accepted by
Bank in writing. Obligor will defend any proceeding which may affect title to
or Bank's security interest in any Collateral, and will indemnify and hold Bank
free and harmless from all costs and expenses of Bank's defense.
7. Obligor will pay when due all existing or future charges, liens or
encumbrances on and all taxes and assessments now or hereafter imposed on or
affecting the Collateral and, if the Collateral is in Obligor's possession, the
realty on which the Collateral is located.
8. Obligor will insure the Collateral with Bank as loss payee in form and
amounts with companies, and against risks and liability satisfactorily to Bank,
and hereby assigns such policies to Bank, agrees to deliver them to Bank at
Bank's request, and authorizes Bank to make any claim thereunder, to cancel the
insurance on Obligor's default, and to receive payment of and endorse any
instrument in payment of any loss or return premium. If Obligor should fail to
deliver the required policy or policies to the Bank, Bank may, at Obligor's cost
and expense, without any duty to do so, get and pay for insurance naming as the
insured, at Bank's option, either both Obligor and Bank, or only Bank, and the
cost thereof shall be secured by this Security Agreement, and shall be repayable
as provided in Paragraph 1 above.
9. Obligor will give Bank any information it requires. All information
at any time supplied to Bank by Obligor (including, but not limited to, the
value and condition of Collateral, financial statements, financing statements,
and statements made in documentary Collateral) is correct and complete, and
Obligor will notify Bank of any adverse change in such information. Obligor
will promptly notify Bank of any change of Obligor's residence, chief executive
office or mailing address.
10. Bank is irrevocably appointed Obligor's attorney-in-fact to do any act
which Obligor is obligated hereby to do, to exercise such rights as Obligor may
exercise, to use such equipment as Obligor might use, to enter Obligor's
premises to give notice of Bank's security interest, and to collect Collateral
and proceeds and to execute and file in Obligor's name any financing statements
and amendments thereto required to perfect Bank's security interest hereunder,
all to protect and preserve the Collateral and Bank's rights hereunder. Bank
may:
(a) Endorse, collect and receive delivery or payment of instruments
and documents constituting Collateral;
(b) Make extension agreements with respect to or affecting
Collateral, exchange it for other Collateral, release persons liable
thereon or take security for the payment thereof, and compromise
disputes in connection therewith;
(c) Use or operate Collateral for the purpose of preserving
Collateral or its value and for preserving or liquidating Collateral.
11. If more than one Obligor signs this Agreement, their liability is
joint and several. Any Obligor who is married agrees that recourse may be had
against separate property for the Debt. Discharge of any Obligor except for
full payment, or any extension, forbearance, change of rate of interest, or
acceptance, release or substitution of Collateral or any impairment or
suspension of Bank's rights against an Obligor, or any transfer of an Obligor's
interest to another shall not affect the liability of any other Obligor. Until
the Debt shall have been paid or performed in full, Bank's rights shall continue
even if the Debt is outlawed. All Obligors waive: (a) any right to require
Bank to proceed against any Obligor before any other, or to pursue any other
remedy; (b) presentment, protest and notice of protest, demand and notice of
nonpayment, demand or performance, notice of sale, and advertisement of sale;
(c) any right to the benefit of or to direct the application of any Collateral
until the Debt shall have been paid; (d) and any right of subrogation to Bank
until Debt shall have been paid or performed in full.
12. Upon default, at Bank's option, without demand or notice, all or any
part of the Debt shall immediately become due. Bank shall have all rights given
by law, and may sell, in one or more sales, Collateral in any county where Bank
has an office. Bank may purchase at such sale. Sales for cash or on credit to a
wholesaler, retailer or user of the Collateral, or at public or private auction,
are all to be considered commercially reasonable. Bank may require Obligor to
assemble the Collateral and make it available to Bank at the entrance to the
location of the Collateral, or a place designated by Bank.
Defaults shall include:
(a) Obligor's failure to pay or perform this or any agreement with
Bank or breach of any warranty herein, or Borrower's failure to pay or
perform any agreement with Bank.
(b) Any change in Obligor's or Borrower's financial condition which
in Bank's judgment impairs the prospect of Borrower's payment or
performance.
(c) Any actual or reasonably anticipated deterioration of the
Collateral or in the market price thereof which causes it, in Bank's
judgment, to become unsatisfactory as security.
(d) Any levy or seizure against Borrower or any of the Collateral.
(e) Death, termination of business, assignment for creditors,
insolvency, appointment of receiver, or the filing of any petition
under bankruptcy or debtor's relief laws of, by or against Obligor or
Borrower or any guarantor of the Debt.
(f) Any warranty or representation which is false or is believed in
good faith by Bank to be false.
13. Bank's acceptance of partial or delinquent payments or the failure of
Bank to exercise any right or remedy shall not waive any obligation of Obligor
or Borrower or right of Bank to modify this Agreement, or waive any other
similar default.
14. On transfer of all or any part of the Debt, Bank may transfer all or
any part of the Collateral. Bank may deliver all or any part of the Collateral
to any Obligor at any time. Any such transfer or delivery shall discharge Bank
from all liability and responsibility with respect to such Collateral
transferred or delivered. This Agreement benefits Bank's successors and assigns
and binds Obligor's heirs, legatees, personal representatives, successors and
assigns. Obligor agrees not to assert against any assignee of Bank any claim or
defense that may exist against Bank. Time is of the essence. This Agreement and
supplementary schedules hereto contain the entire security agreement between
Bank and Obligor. Obligor will execute any additional agreements, assignments
or documents reasonably required by Bank to carry this Agreement into effect.
15. This Agreement shall be governed by and construed in accordance with
the laws of the State of California, to the jurisdiction of whose courts the
Obligor hereby agrees to submit. Obligor agrees that service of process may be
accomplished by any means authorized by California law. All words used herein
in the singular shall be considered to have been used in the plural where the
context and construction so require.
[LOGO]
IMPERIAL BANK
MEMBER FDIC
GENERAL SECURITY AGREEMENT
(TANGIBLE AND INTANGIBLE PERSONAL PROPERTY)
This Agreement is executed on October 28, 1996, by GENESYS TELECOMMUNICATIONS
LABORATORIES
(hereinafter called "Obligor").
In consideration of financial accommodations given, to be given or continued,
the Obligor grants to IMPERIAL BANK (hereinafter called "Bank") a security
interest in (a) all property (i) delivered to Bank by Obligor, (ii) which shall
be in Bank's possession or control in any matter or for any purpose, (iii)
described below, (iv) now owned or hereafter acquired by Obligor of the type
or class described below and/or in any supplementary schedule hereto, or in any
financing statement filed by Bank and executed by or on behalf of Obligor; (b)
the proceeds, increase and products of such property, all accessions thereto,
and all property which Obligor may receive on account of such collateral which
Obligor will immediately deliver to Bank (collectively referred to as
"Collateral") to secure payment and performance of all of Obligor's present or
future debts or obligations to Bank, whether absolute or contingent (hereafter
referred to as "Debt"). Unless otherwise defined, words used herein have the
meanings given them in the California Uniform Commercial Code.
Collateral:
A. VEHICLE, VESSEL, AIRCRAFT:
- --------------------------------------------------------------------------------
Identification License or
Year Make/Manufacturer Model and Serial No. Registration No. New or Used
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Engine or other equipment:
------------------------------------------------------
(For aircraft - original ink signature on copy to FAA)
B. DEPOSIT ACCOUNTS:
Type _________________ Account Number _______________ Amount $ _________________
In name of___________________________ Depository _______________________________
AND ALL EXTENSIONS OR RENEWALS THEREOF
C. ACCOUNTS, INTANGIBLES AND OTHER: (Describe)
All personal property, whether presently existing or hereafter created or
acquired, including but not limited to: All accounts, chattel paper,
documents, instruments, money, deposit accounts and general intangibles
including returns, repossessions, books and records relating thereto, and
equipment containing said books and records. All goods including equipment
and inventory. All proceeds including, without limitation, insurance
proceeds. All guarantees and other security therefor.
The collateral not in Bank's possession will be located at: 1155 Market St.,
10th Fl., San Francisco, CA 94103
[_] If checked, the Obligor is executing this Agreement as an Accommodation
Debtor only and the Obligor's liability is limited to the security interest
granted In the Collateral described herein. The party being accommodated is
("Borrower").
All the terms and provisions on the reverse side hereof are incorporated herein
as though set forth in full, and constitute a part of this Agreement.
Signature
Name (indicate title, if applicable) Address
GENESYS /s/ Michael McCloskey BY /s/ Michael McCloskey 1155 Market St., 10th
- ---------------------------------- ------------------------------ ------------------------------
TELECOMMUNICATIONS LABORATORIES C.F.O.
Fl. San Francisco, CA
- ---------------------------------- ------------------------------ ------------------------------
94103
- ---------------------------------- ------------------------------ ------------------------------
[LOGO OF IMPERIAL BANK]
MEMBER FDIC
ITEMIZATION OF AMOUNT FINANCED
DISBURSEMENT INSTRUCTIONS
Name(s): GENESYS TELECOMMUNICATIONS LABORATORIES Date: October 28, 1996
$ paid to you directly by Cashiers Check No.
$2,500,000.00 credited to deposit account No. 20-001-232 when
advances are
$ paid on Loan(s) No. requested
$ 500,000.00 amounts paid to Bank for: Letters of Credit issuance
sublimit*
Amounts paid to others on your behalf:
$ to Title Insurance Company
$ to Public Officials
$ to Sublimit within total credit amount of
$2,500,000.00
$ to
$ to
$ to
$2,500,000.00 SUBTOTAL (NOTE AMOUNT)
Less $ 0.00 Prepaid Finance Charge (Loan fee(s))
$2,500,000.00 TOTAL (AMOUNT FINANCED)
Upon consummation of this transaction, this document will also serve as the
authorization for Imperial Bank to disburse the loan proceeds as stated above.
GENESYS TELECOMMUNICATIONS LABORATORIES
BY /s/ Michael McCloskey
- ---------------------------------- ------------------------------------
Signature Signature
- ---------------------------------- ------------------------------------
Signature Signature
- --------------------------------------------------------------------------------
[LOGO OF IMPERIAL BANK] AUTOMATIC DEBIT AUTHORIZATION
California's Business Bank(SM)
MEMBER FDIC
================================================================================
TO: IMPERIAL BANK
RE: LOAN #__________________
$2,500,000.00
You are hereby authorized and instructed to charge account No. 20-00l-232 in
----------
the name of GENESYS TELECOMMUNICATIONS LABORATORIES for principal and interest
---------------------------------------
payments due on above referenced loan as set forth below and credit the loan
referenced above.
[X] Debit each interest payment as it becomes due according to the terms
of the note and any renewals or amendments thereof.
[_] Debit each principal payment as it becomes due according to the terms
of the note and any renewals or amendments thereof.
This Authorization is to remain in full force and effect until revoked in
writing.
================================================================================
Borrower Signature Date
GENESYS TELECOMMUNICATIONS LABORATORIES 10/28/96
- ------------------------------------------------- --------------------------
BY /s/ Michael McCloskey
- ------------------------------------------------- --------------------------
- --------------------------------------------------------------------------------
[LOGO OF IMPERIAL BANK]
MEMBER FDIC
NOTE
$ 500,000.00 San Jose ; California October 28, 1996
On March 31, 2000, and as hereinafter provided, for value received, the
undersigned promises to pay to IMPERIAL BANK ("Bank"), a California banking
corporation, or order, at its Santa Clara Valley Regional office, the principal
sum of $500,000.00 or such sums up to the maximum if so stated, as the Bank may
now or hereafter advance to or for the benefit of the undersigned in accordance
with the terms hereof, together with interest from date of disbursement or N/A,
whichever is later, on the unpaid principal balance [_] at the rate of % per
year [X] at the rate of 1.000% per year in excess of the rate of interest
which Bank has announced as its prime lending rate (the "Prime Rate"), which
shall vary concurrently with any change in such Prime Rate, or $ 250.00,
whichever is greater. Interest shall be computed at the above rate on the basis
of the actual number of days during which the principal balance is outstanding,
divided by 360, which shall, for interest computation purposes, be considered
one year.
Interest shall be payable [X] monthly [_] quarterly [_] included with principal
[X] in addition to principal [_] beginning November 30, 1996, and if not so paid
shall become a part of the principal. All payments shall be applied first to
interest, and the remainder, if any, on principal. [X] (If checked), Principal
shall be payable in installments of $ **, or more, each installment on the last
day of each month, beginning April 30, 1997. Advances not to exceed any unpaid
balance owing at any one time equal to the maximum amount specified above, may
be made at the option of Bank.
Any partial prepayment shall be applied to the installments, if any, in
inverse order of maturity. Should default be made in the payment of principal or
interest when due, or in the performance or observance, when due, of any item,
covenant or condition of any deed of trust, security agreement or other
agreement (including amendments or extensions thereof) securing or pertaining to
this note, at the option of the holder hereof and without notice or demand, the
entire balance of principal and accrued interest then remaining unpaid shall (a)
become immediately due and payable, and (b) thereafter bear interest, until paid
in full, at the increased rate of 5% per year in excess of the rate provided for
above, as it may vary from time to time.
Defaults shall include, but not be limited to, the failure of the maker(s)
to pay principal or interest when due; the filing as to each person obligated
hereon, whether as maker, co-maker, endorser or guarantor (individually or
collectively referred to as the "Obligor") of a voluntary or involuntary
petition under the provisions of the Federal Bankruptcy Act; the issuance of any
attachment or execution against any asset of any Obligor; the death of any
Obligor; or any deterioration of the financial condition of any Obligor which
results in the holder hereof considering itself, in good faith, insecure.
[X] If any installment payment or principal balance payment due hereunder is
delinquent ten or more days, Obligor agrees to pay a late charge in the amount
of 5% of the payment so due and unpaid, in addition to the payment; but nothing
in this paragraph is to be construed as any obligation on the part of the holder
of this note to accept payment of any installment past due or less than the
total unpaid principal balance after maturity.
If this note is not paid when due, each Obligor promises to pay all costs
and expenses of collection and reasonable attorney's fees incurred by the holder
hereof on account of such collection, plus interest at the rate applicable to
principal, whether or not suit is filed hereon. Each Obligor shall be jointly
and severally liable hereon and consents to renewals, replacements and
extensions of time for payment hereof, before, at, or after maturity; consents
to the acceptance, release or substitution of security for this note; and waives
demand and protest and the right to assert any statute of limitations. Any
married person who signs this note agrees that recourse may be had against
separate property for any obligations hereunder. The indebtedness evidenced
hereby shall be payable in lawful money of the United States. In any action
brought under or arising out of this note, each Obligor, including successor(s)
or assign(s) hereby consents to the application of California law, to the
jurisdiction of any competent court within the State of California, and to
service of process by any means authorized by California law.
No single or partial exercise of any power hereunder, or under any deed of
trust, security agreement or other agreement in connection herewith shall
preclude other or further exercises thereof or the exercise of any other such
power. The holder hereof shall at all times have the right to proceed against
any portion of the security for this note in such order and in such manner as
such holder may consider appropriate, without waiving any rights with respect to
any of the security. Any delay or omission on the part of the holder hereof in
exercising any right hereunder, or under any deed of trust, security agreement
or other agreement, shall not operate as a waiver of such right, or of any other
right, under this note or any deed of trust, security agreement or other
agreement in connection herewith.
** See Addendum attached
GENESYS TELECOMMUNICATIONS LABORATORIES
- ---------------------------------- -----------------------------------------
BY /s/ Michael McCloskey
- ---------------------------------- -----------------------------------------
- ---------------------------------- -----------------------------------------
[LOGO IMPERIAL BANK]
MEMBER FDIC
ITEMIZATION OF AMOUNT FINANCED
DISBURSEMENT INSTRUCTIONS
Name(s): GENESYS TELECOMMUNICATIONS LABORATORIES Date: October 28, 1996
$ paid to you directly by Cashiers Check No.
$500,000.00 credited to deposit account No. 20-001-232 from undispersed
$ paid on Loan(s) No. loan proceeds when requested
$ amounts paid to Bank for:
Amounts paid to others on your behalf:
$ to Title Insurance Company
$ to Public Officials
$ to
$ to
$ to
$ to
$500,000.00 SUBTOTAL (NOTE AMOUNT)
LESS $ 0.00 Prepaid Finance Charge (Loan fee(s))
$500,000.00 TOTAL (AMOUNT FINANCED)
Upon consummation of this transaction, this document will also serve as the
authorization for Imperial Bank to disburse the loan proceeds as stated above.
GENESYS TELECOMMUNICATIONS LABORATORIES
BY /s/ Michael McCloskey
- ---------------------------------------- -------------------------------
Signature Signature
- ---------------------------------------- -------------------------------
Signature Signature
- --------------------------------------------------------------------------------
[LOGO OF IMPERIAL BANK] AUTOMATIC DEBIT AUTHORIZATION
CALIFORNIA'S BUSINESS BANK(SM)
MEMBER FDIC
================================================================================
TO: IMPERIAL BANK
RE: LOAN #__________________
$500,000.00
You are hereby authorized and instructed to charge account No. 20-00l-232 in the
----------
name of GENESYS TELECOMMUNICATIONS LABORATORIES for principal and interest
---------------------------------------
payments due on above referenced loan as set forth below and credit the loan
referenced above.
[X] Debit each interest payment as it becomes due according to the terms
of the note and any renewals or amendments thereof.
[X] Debit each principal payment as it becomes due according to the terms
of the note and any renewals or amendments thereof.
This Authorization is to remain in full force and effect until revoked in
writing.
================================================================================
Borrower Signature Date
GENESYS TELECOMMUNICATIONS LABORATORIES 10/28/96
- ------------------------------------------------- --------------------------
BY Michael McCloskey
- ------------------------------------------------- --------------------------
- --------------------------------------------------------------------------------
This FINANCING STATEMENT is presented for filing and will remain effective, with
certain exceptions, for five years from the date of filing, pursuant to Section
9403 of the California Uniform Commercial Code.
- -----------------------------------------------------------------------------------------------------------------------
1. DEBTOR (LAST NAME FIRST - IF AN INDIVIDUAL 1A. SOCIAL SECURITY OR FEDERAL TAX NO.
GENESYS TELECOMMUNICATIONS LABORATORIES 94-3120525
- -----------------------------------------------------------------------------------------------------------------------
1B. MAILING ADDRESS 1C. CITY, STATE 1D. ZIP CODE
1155 Market St., 10th Fl. San Francisco, CA 94103
- -----------------------------------------------------------------------------------------------------------------------
2. ADDITIONAL DEBTOR (IF ANY) (LAST NAME FIRST - IF AN INDIVIDUAL 2A. SOCIAL SECURITY OR FEDERAL TAX NO.
- -----------------------------------------------------------------------------------------------------------------------
2B. MAILING ADDRESS 2C. CITY, STATE 2D. ZIP CODE
- -----------------------------------------------------------------------------------------------------------------------
3. DEBTOR'S TRADE NAMES OR STYLES 3A. FEDERAL TAX NUMBER
=======================================================================================================================
4. SECURED PARTY 4A. SOCIAL SECURITY NO., FEDERAL TAX NO.
IMPERIAL BANK OR BANK TRANSIT AND A.B.A. NO.
NAME 226 Airport Parkway
MAILING ADDRESS San Jose, California 95110 16-144/1222
CITY STATE ZIP CODE
- -----------------------------------------------------------------------------------------------------------------------
5. ASSIGNEE OF SECURED PARTY (IF ANY) 5A. SOCIAL SECURITY NO., FEDERAL TAX NO.
OR BANK TRANSIT AND A.B.A. NO.
NAME
MAILING ADDRESS
CITY STATE ZIP CODE
- -----------------------------------------------------------------------------------------------------------------------
6. This FINANCING STATEMENT covers the following types or items of property (include description of real property on
which located and owner of record when required by instruction 4).
All personal property, whether presently existing or hereafter created
or acquired, including but not limited to: All accounts, chattel
paper, documents, instruments, money, deposit accounts and general
intangibles including returns, repossessions, books and records
relating thereto, and equipment containing said books and records. All
goods including equipment and inventory. All proceeds including,
without limitation, insurance proceeds. All guarantees and other
security therefor.
- -----------------------------------------------------------------------------------------------------------------------
7. CHECK [X] 7A. PRODUCTS OF 7B. DEBTOR(S) SIGNATURE NOT REQUIRED IN ACCORDANCE WITH
IF APPLICABLE [X] COLLATERAL ARE ALSO INSTRUCTION 5 (a) ITEM:
COVERED [_](1) [_](2) [_](3) [_](4)
- -----------------------------------------------------------------------------------------------------------------------
8. CHECK [X]
IF APPLICABLE [_] DEBTOR IS A `TRANSMITTING UTILITY' IN ACCORDANCE WITH UCC SECTION 9105 (1) (n)
- -----------------------------------------------------------------------------------------------------------------------
9. DATE: 10/28/96 C 10. THIS SPACE FOR USE OF FILING OFFICER
BY /s/ Michael McCloskey O (DATE, TIME, FILE NUMBER AND
SIGNATURE(S) OF DEBTORS D FILING OFFICER)
E
- -----------------------------------------------------------------------------------------------------------------------
GENESYS TELECOMMUNICATIONS LABORATORIES 1
TYPE OR PRINT NAME(S) OF DEBTOR(S)
- --------------------------------------------------------------------- 2
BY /s/ Michael McCloskey 3
SIGNATURE(S) 0F SECURED PARTY(IES)
- --------------------------------------------------------------------- 4
IMPERIAL BANK
5
TYPE OR PRINT NAME(S) OF SECURED PARTY(IES)
- --------------------------------------------------------------------- 6
11. Return copy to:
7
NAME IMPERIAL BANK
ADDRESS 9920 La Cienega Blvd. 8
CITY Inglewood, California 90301
STATE Att: Note Center 9
ZIP CODE
0
[LOGO OF IMPERIAL BANK]
MEMBER FDIC
AGREEMENT TO PROVIDE INSURANCE
(REAL OR PERSONAL PROPERTY)
TO: IMPERIAL BANK Date: October 28, 1996
226 Airport Parkway Borrower:
San Jose, California 95110 GENESYS TELECOMMUNICATIONS LABORATORIES
In consideration of a loan in the amount of $3,000,000.00, secured by All
tangible personal property including inventory and equipment.
I/We agree to obtain adequate insurance coverage to remain in force during the
term of the loan.
I/We also agree to advise the below named agent to add Imperial Bank as loss
payee on the new or existing insurance policy, and to furnish Bank at above
address with a copy of said policy/endorsements and any subsequent renewal
policies.
I/We understand that the policy must contain:
1. Fire and extended coverage in an amount sufficient to cover:
a) The amount of the loan, OR
b) All existing encumbrances, whichever is greater,
But not in excess of the replacement value of the improvements on the
real property.
2. Lender's "Loss Payable" Endorsement Form 438 BFU in favor of Imperial
Bank, or any other form acceptable to Bank.
INSURANCE INFORMATION
Insurance Co./Agent: Aon Risk Services Telephone No.: (408) 535-2817
Agent's Address: 100 Park Center Plaza, Ste. 506
San Jose, CA 95113
GENESYS TELECOMMUNICATIONS LABORATORIES
Signature of Obligor: BY /s/ Michael McCloskey
-----------------------------------
Signature of Obligor:
-----------------------------------
================================================================================
- -----------------------------------------------------------
FOR BANK USE ONLY
INSURANCE VERIFICATION: Date: _________________
Person Spoken to: ___________________________________
Policy Number: ________________________________________
Effective From: _________________ To: _________________
Verified By: ____________________________________
- -----------------------------------------------------------