1
EXHIBIT 10.32
WELLS FARGO BANK REVOLVING LINE OF CREDIT NOTE
- -------------------------------------------------------------------------------
$2,000,000.00
Oakland, California
August 14, 1996
FOR VALUE RECEIVED, the undersigned AVIGEN, INC. ("Borrower~) promises to pay
to the order of WELLS FARGO BANK, NATIONAL ASSOCIATION ("Bank") at its office
at East Bay RCBO, One Kaiser Plaza Suite 850, Oakland, CA 94612, or at such
other place as the holder hereof may designate, in lawful money of the United
States of America and in Immediately available funds, the principal sum of
$2,000,000.00, or so much thereof as may be advanced and be outstanding, with
interest thereon, to be computed on each advance from the date of its
disbursement as set forth herein.
INTEREST:
(a) Interest. The outstanding principal balance of this Note shall bear
interest (computed on the basis of a 360-day year, actual days elapsed) at a
rats per annum equal to the Prime Rate in effect from time to time~ The "Prime
Rate" is a bass rate that Bank from time to time establishes and which serves
as the basis upon which effective rates of interest are calculated for those
loans making reference thereto. Each change in the rate of interest hereunder
shall become effective on the date each Prime Rate change Is announced within
Bank.
(b) Payment of Interest. Interest accrued on this Note shall be payable on
the last day of each month, commencing September 30, 1996.
(C) Default Interest. From and after the maturity date of this Note, or such
earlier date as all principal owing hereunder becomes due and payable by
acceleration or otherwise, the outstanding principal balance of this Note shall
bear Interest until paid in full at an increased rate per annum (computed on
the basis of a 360-day year, actual days elapsed) equal to 4% above the rate of
interest from time to time applicable to this Note.
BORROWING AND REPAYMENT:
(a) Borrowing and Repayment. Borrower may from time to time during the term
of this Note borrow, partially or wholly repay its outstanding borrowings, and
reborrow, subject to all of the limitations, terms and conditions of this Note
and of any document executed in connection with or governing this Note;
provided however, that the total outstanding borrowings under this Note shall
not at any time exceed the principal amount stated above. The unpaid principal
balance of this obligation at any time shall be the total amounts advanced
hereunder by the holder hereof less the amount of principal payments made
hereon by or for any Borrower, which balance may be endorsed hereon from time
to time by the holder. The outstanding principal balance of this Note shall be
due and payable in full on September 30, 1997.
(b) Advances. Advances hereunder, to the total amount of the principal sum
available hereunder, may be made by the holder at the oral or written request
of (i) GLENN BAUER, any one acting alone, who are authorized to request
advances and direct the disposition of any advances until written notice of the
revocation of such authority is received by the holder at the office designated
above, or (ii) any person, with respect to advances deposited to the credit of
any account of any Borrower with the holder, which advances, when so deposited,
shall be conclusively presumed to have been made to or for the benefit of each
Borrower regardless of the fact that persons other than those authorized to
request advances may have authority to draw against such account. The holder
shall have no obligation to determine whether any person requesting an advance
is or has been authorized by any Borrower.
(c) Application of Payments. Each payment made on this Note shall be
credited first, to any interest then due and second, to the outstanding
principal balance hereof.
60
2
EVENTS OF DEFAULT:
The occurrence of any of the following shall constitute an "Event of Default"
under this Note:
(a) The failure to pay any principal, interest, fees or other charges when
due hereunder or under any contract, instrument or document executed in
connection with this Note.
(b) The filing of a petition by or against any Borrower, any guarantor of
this Note or any general partner or
(d) Any default in the payment or performance of any obligation, or any
defined event of default, under any provisions of any contract, instrument or
document pursuant to which any Borrower or Third Party Obligor has incurred any
obligation for borrowed money, any purchase obligation, or any other lability
of any kind to any person or entity, including the holder.
(e) Any financial statement provided by any Borrower or Third Party Obligor
to Bank proves to be incorrect, false or misleading in any material respect.
(f) Any sale or transfer of all or a substantial or material part of the
assets of any Borrower or Third Party Obligor other than in the ordinary course
of its business.
(9) Any violation or breach of any provision of, or any defined event of
default under, any addendum to this Note or any loan agreement, guaranty,
security agreement, deed of trust, mortgage or other document executed in
connection with or securing this Note.
MISCELLANEOUS:
(a) Remedies. Upon the occurrence of any Event of Default, the holder of
this Note, at the holder's option, may declare all sums of principal and
interest outstanding hereunder to be Immediately due and payable without
presentment, demand, notice of nonperformance, notice of protest, protest or
notice of dishonor, all of which are expressly waived by each Borrower, and the
obligation, if any, of the holder to extend any further credit hereunder shall
immediately cease and terminate. Each Borrower shall pay to the holder
immediately upon demand the full amount of all payments, advances, charges,
costs and expenses, including reasonable attorneys' fees (to include outside
counsel fees and all allocated costs of the holder's in-house counsel),
expended or Incurred by the holder in connection with the enforcement of the
holder's rights and/or the collection of any amounts which become due to the
holder under this Note, and the prosecution or defense of any action in any way
related to this Note, including without limitation, any action for declaratory
relief, whether incurred at the trial or appellate level, in an arbitration
proceeding or otherwise, and including any of the foregoing incurred in
connection with any bankruptcy proceeding (including without limitation, any
adversary proceeding, contested matter or motion brought by Bank or any other
person) relating to any Borrower or any other person or entity.
(b) Obligations Joint and Several. Should more than one person or entity
sign this Note as a Borrower, the obligations of each such Borrower shall be
joint and several.
(c) Governing Law. This Note shall be governed by and construed in
accordance with the laws of the state of California.
IN WITNESS WHEREOF, the undersigned has executed this Note as of the date first
written above.
AVIGEN, INC.
By: /s/ Glenn Bauer
61
3
Title: Controller
By: /s/ Thomas J. Paulson
Title: VP Finance
62
4
WELLS FARGO BANK CORPORATE RESOLUTION: BORROWING
- -------------------------------------------------------------------------------
TO: WELLS FARGO BANK, NATIONAL ASSOCIATION
RESOLVED: That this corporation, AVIGEN, INC., proposes to obtain credit from
time to time, or has obtained credit from Wells Fargo Bank, National
Association ('Bank").
BE IT FURTHER RESOLVED, that any one of the following officers:
together with any one of the following officers:
of this corporation be and they are hereby authorized and empowered for and on
behalf of and in the name of this corporation and as its corporate act and
deed:
(a) To borrow money from Bank and to assume any liabilities of any other
person or entity to Bank, in such form and on such terms and conditions as
shall be agreed upon by those authorized above and Bank, and to sign and
deliver such promissory notes and other evidences of indebtedness for money
borrowed or advanced and/or for indebtedness assumed as Bank shall require;
such promissory notes or other evidences of indebtedness may provide that
advances be requested by telephone communication and by any officer, employee
or agent of this corporation so long as the advances are deposited into any
deposit account of this corporation with Bank, this corporation shall be bound
to Bank by, and Bank may rely upon, any communication or act, including
telephone communications, purporting to be done by any officer, employee or
agent of this corporation provided that Bank believes, in good faith, that the
same is done by such person.
(b) To contract for the issuance by Bank of letters of credit, to discount
with Bank notes, acceptances and evidences of indebtedness payable to or due
this corporation, to endorse the same and execute such contracts and
instruments for repayment thereof to Bank as Bank shall require, and to enter
into foreign exchange transactions with or through Bank.
(c) To mortgage, encumber, pledge, convey, grant, assign or otherwise
transfer all or any part of this corporation's real or personal property for
the purpose of securing the payment of any of the promissory notes, contracts,
instruments and other evidences of indebtedness authorized hereby, and to
execute and deliver to Bank such deeds of trust, mortgages, pledge agreements
and/or other security agreements as Bank shall require.
(d) To perform all acts and to execute and deliver all documents described
above and all other contracts and instruments which Bank deems necessary or
convenient to accomplish the purposes of this resolution and/or to perfect or
continue the rights, remedies and security interests to be given to Bank
hereunder, including without limitation, any modifications, renewals and/or
extensions of any of this corporation's obligations to Bank, however evidenced;
provided that the aggregate principal amount of all sums borrowed and credits
established pursuant to this resolution shall not at any time exceed the sum of
$2,000.000.00 outstanding and unpaid.
Loans made pursuant to a special resolution and loans made by offices of Bank
other than the office to which this resolution is delivered shall be in
addition to foregoing limitation.
BE IT FURTHER RESOLVED, that the authority hereby conferred is in addition to
that conferred by any other resolution heretofore or hereafter delivered to
Bank and shall continue in full force and effect until Bank shall have received
notice in writing, certified by the Secretary of this corporation, of the
revocation hereof by a resolution duly adopted by the Board of Directors of
this corporation. Any such revocation shall be effective only as to credit
which is extended or committed by Bank, or actions which are taken by this
corporation pursuant to the resolutions contained herein, subsequent to Bank's
receipt of such notice. The authority hereby conferred shall be deemed
retroactive, and any and all acts-authorized herein which were performed prior
to the passage of this resolution are hereby approved and ratified.
63
5
CERTIFICATION
1, /s/ Thomas J. Paulson, Secretary of AVIGEN, INC., a corporation created
and existing under the laws of the state of CALIFORNIA, do hereby certify and
declare that the foregoing is a full, true and correct copy of the resolutions
duly passed and adopted by the Board of Directors of said corporation, by
written consent of all Directors of said corporation or at a meeting of said
Board duly and regularly called, noticed and held on November 22, 1996, at
which meeting a quorum of the Board of Directors was present and voted in favor
of said resolutions; that said resolutions are now in full force and effect;
that there is no provision in the Articles of Incorporation or Bylaws of said
corporation, or any shareholder agreement, limiting the power of the Board of
Directors of said corporation to pass the foregoing resolutions and that such
resolutions are in conformity with the provisions of such Articles of
Incorporation and Bylaws; and that no approval by the shareholders of, or of
the outstanding shares of, said corporation is required with respect to the
matters which are the subject of the foregoing resolutions.
IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed the corporate
seal of said corporation as of November 22, 1996.
/s/ Thomas J. Paulson
Secretary of Avigen Inc., a corporation
(Seal)
64