Exhibit 10.26
LOAN & SECURITY AGREEMENT
THIS LOAN AND SECURITY AGREEMENT entered into as of the 18th day of November,
1997 by and between MetLife Capital Corporation, a Delaware corporation, whose
address is 10900 NE 4th Street, Suite 500, Bellevue, WA 98004 ("Lender") and
PointCast Incorporated, a California corporation, whose address is 501 Marcara
Avenue, Sunnyvale, CA 94086 ("Borrower").
WHEREAS, Lender has agreed to make a commercial loan or loans to Borrower:
and
WHEREAS, as a condition to making the loans, and in order to secure the
repayment thereof, Lender has required Borrower to execute and deliver to Lender
this Loan and Security Agreement.
NOW THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Borrower and Lender agree as follows:
1. CREATION OF SECURITY INTEREST. As security for the due and punctual
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payment of any and all of the present and future obligations of the borrower to
Lender under this Loan and Security Agreement and the other Loan Documents (as
defined below), whether direct or contingent or joint or several, Borrower
hereby conveys, assigns and grants to Lender a continuing security interest in
all of Borrower's rights, title and interests in and to the equipment described
in the Supplemental Security Agreement(s) entered into pursuant to this Loan and
Security Agreement from time to time ("Equipment") including all present and
future additions, attachments and accessories thereto, all substitutions
therefor and replacements thereof and all proceeds thereof, including all
proceeds of insurance (such Equipment and property hereinafter called
"Collateral").
2. THE LOANS.
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(a) Subject to the terms and conditions of this Loan and Security Agreement,
lender agrees to make a loan or loans to Borrower. The maximum principal amount
of any loan or loans to be made by Lender to Borrower shall be within Lender's
discretion, subject to the exercise of Lender's reasonable business judgment,
and shall be as stated in the loan commitment letter issued by lender to
Borrower, or in the event a commitment letter is not issued by Lender, in
Lender's internal credit approval (each such loan or loans shall be referred to
as "the Loan Amount").
(b) The Loan Amounts shall be repaid by Borrower as a term loan or term loans
("Term Loan"). The Term Loan shall be evidenced by a promissory note or notes in
the form attached hereto as Exhibit "A" ("Term Note"). The payment provisions of
each Term Note shall be stated therein.
(c) If requested by Borrower, and in accordance with the terms and conditions
of Section 3 hereof, Lender shall make interim fundings to Borrower of a Term
Loan as partial advances of the Loan Amount ("Interim Loans"). The interim Loans
shall either be for the payment of the acquisition cost of any items of
Equipment delivered and accepted by Borrower prior to the expiration date of
Lender's loan commitment to Borrower ("Commitment Expiration date") or to fund
progress payments to the vendor or manufacturer of the Equipment, if the making
of progress payments was agreed to by Lender in its commitment or approval to
make the loan or loans to Borrower. The Interim Loans shall be evidenced by
promissory notes in the form attached hereto as Exhibit "B" ("interim Note").
Interest on all Interim Loans shall be payable as provided therein. The
principal amount due under the Interim Loans shall be due as provided in the
Interim Notes, at which time, provided no Event of Default hereunder has
occurred and is continuing or event which with the passing of time or giving of
notice or both would become an Event of Default hereunder has occurred and is
continuing. Lender shall consolidate all Interim Loans and convert them to a
Term Loan evidenced by a Term Note or Notes. Whether or not a Term Loan is
evidenced by one or more Term Notes shall be agreed between Lender and Borrower,
or in the absence of such an agreement, as decided by Lender,
in the exercise of its reasonable business judgment.
(d) In the event that the amount loan pursuant to the Interim Loans is less
than the Loan Amount, subject to Borrowers compliance with the terms and
conditions of this Loan and Security Agreement (including the satisfaction of
the conditions of borrowing set forth in Section 7 of this Loan and Security
Agreement including but not limited to providing Lender with a description of
the items of Equipment), Lender shall disburse to Borrower the balance of the
Loan Amount on the same date that the Interim Loans are converted into a term
loan.
3. METHOD FOR BORROWING ON INTERIM LOAN. Borrower shall give Lender at least
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five (5) business days written notice of a request for the disbursement of an
Interim Loan ("Request"), specifying the date on which the Interim Loan is to be
disbursed. Such Request shall be in the form attached hereto as Exhibit "C".
Such Request shall be accompanied by an original copy of the invoice or invoices
to be paid from the Interim Loan. Such Request shall constitute a representation
and warranty by the Borrower that (i) as of the date of the Request no Event of
Default or event which with the passing of time or the giving of notice or both
would constitute an Event of Default hereunder has occurred and is continuing
and (ii) in the event items of Equipment have been delivered to Borrower,
Borrower has unconditionally accepted the Equipment from the vendor thereof.
Subject to the conditions of this Loan and Security Agreement, Lender shall
disburse the Interim Loan to the invoicing party, or if Borrower shall have paid
the amount of such invoice, Lender shall reimburse Borrower, upon receipt of
proof of payment from Borrower.
4. CROSS COLLATERAL/CROSS DEFAULT. All Collateral shall secure the payment
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and performance of all of Borrower's liabilities and obligations to Lender
hereunder and under any of the loan documents relating hereto including, but not
limited to all Interim Notes and all Term Notes (the Loan and Security
Agreement, the Interim Notes, the Term Notes, the Supplemental Security
Agreement(s) and all other loan documents relating hereto may be referred to
herein collectively as the Loan Documents"). Lender's security interest in the
Collateral shall not be terminated until and unless all of Borrower's
obligations to Lender under any of the Loan Documents are fully paid and
performed. The occurrence of an event of default under any other of the Loan
Documents shall be deemed to be an Event of Default hereunder and an Event of
Default hereunder shall be deemed to be an event of default under any other of
the Loan Documents.
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5. REPRESENTATIONS AND WARRANTIES. Borrower hereby represents and warrants as
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follows:
(a) Power and Authorization. Borrower has the full power and (corporate)
authority to execute deliver and perform Borrower's obligations under the Loan
Documents. The execution and delivery of the Loan Documents have been authorized
by all requisite corporate (or partnership) action on the part of Borrower. The
execution, delivery and performance of the Loan Documents have not constituted
and will not constitute a breach, default or violation of or under Borrower's
articles of incorporation, by-laws (partnership agreement), or any other
agreement, indenture, contract, lease, law, order, decree judgment or injunction
to which Borrower is a party or may be bound and have not resulted and will not
result in the creation of any lien upon the Equipment pursuant to any agreement,
indenture, lease, contract or other instrument to which Borrower is a party,
except the lien created by this Loan and Security Agreement.
(b) Existence. If Borrower is a corporation, Borrower (i) is duly incorporated,
validly existing and in good standing under the laws of its state of
incorporation, (ii) has all corporate powers and all governmental licenses,
authorizations, consents and approvals required to carry out its business as now
conducted, and (iii) is duly qualified to transact business as now conducted,
and (iii) is duly qualified to transact business as a foreign corporation in
each jurisdiction where the Equipment will be located and in the jurisdiction
where its principal place of business is located. If Borrower is a partnership,
Borrower (i) has been duly formed as a (limited or general) partnership under
the laws of the state of its organization, (ii) is comprised of the general
partner(s) listed an the Schedule of Partners attached to this Loan and Security
Agreement, and (iii) is in good standing under the laws of the state of its
formation.
(c) Binding Effect. This Loan and Security Agreement constitutes the valid and
binding agreement of the Borrower; the Interim Notes and the Term Note, when
executed and delivered, will constitute the valid and binding obligations of the
Borrower, and the Loan Documents are enforceable in accordance with their terms
except as (i) the enforceability thereof may be limited by the bankruptcy laws,
and (ii) rights of acceleration and the availability of equitable remedies may
be limited by equitable principles of general applicability,
(d) Litigation. There is no action, suit or proceeding pending against, or to
the knowledge of the Borrower, threatened against or affecting the Borrower,
before any court of arbitrator or any governmental body, agency or official
which has not been previously disclosed to the Lender in writing and in which
there is a reasonable possibility of an adverse decision which could materially
adversely affect the business, financial condition or results of operations of
the Borrower or which would in any manner draw into question the validity of any
of the Loan Documents.
(e) Filing of Tax Returns. The Borrower has filed all tax returns required to
have been filed and has paid all taxes shown to be due and payable on such
returns, including interest and penalties, and all other taxes which are payable
by it, to the extent the same have become due and payable. The Borrower knows of
no proposed tax assessment against it and all tax liabilities of the Borrower
are adequately provided for.
(f) Title. The Borrower has or shall have at the time it executes the Term
Note good and indefeasible title to the Collateral free and clear of all liens
other than the Lender's lien.
(g) Compliance with Law. The business and operations of the Borrower have been
and are being conducted in accordance with all applicable laws, rules and
regulations, other than violations which could not (either individually or
collectively) have a material adverse effect on the financial condition or
operations of the Borrower.
(h) Full Disclosure. All documents, records, instruments, certificates,
statements (including, but not by way of limitations financial statements of
Borrower) and information provided to Lender by Borrower in connection with this
Loan and Security Agreement are true and
accurate in all material respects and do not contain any untrue statement, or
fail to contain any statement of a material fact necessary to make the
statements contained herein or therein not misleading. There is no fact known
to the Borrower that Borrower has not disclosed which could materially and
adversely affect the financial condition or operations of Borrower.
(i) Security Interest. The security interest granted to Lender hereunder is a
valid, first priority security interest in the Collateral and has been, or
Promptly after the execution of the Supplemental Security Agreement describing
the Collateral will be, perfected in accordance with the requirements of all
states in which any item of the Collateral is located.
(j) Personal Property. Under the laws of the state(s) in which the Collateral
is to be located, the Collateral is deemed to consist solely of personal
property.
(k) Pollution and Environmental Control. Borrower has obtained all permits,
licenses and other authorizations which are required under, and is in material
compliance with all federal, state, and local laws and regulations relating to
pollution, reclamation, or protection of the environment, including laws
relating to emissions, discharges, releases or threatened releases of
pollutants, contaminants, or hazardous or Toxic materials or wastes into air,
water, or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of
Pollutants, contaminants or hazardous or toxic materials or wastes Borrower
shall maintain all such permits, licenses, and authorizations current.
6. COVENANTS. Borrower hereby agrees and covenants as follows:
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(a) Payment. Borrower shall pay the indebtedness secured hereby as provided
herein and in the Interim Notes and Term Notes.
(b) Location of Collateral. Borrower will keep the Collateral located at the
location or locations stated on the Supplemental Security Agreements provided,
however, that Borrower may change the location of the Collateral with Lender's
prior written consent.
(c) No Liens. Except for the security interest granted hereby or under any
other agreement under which Lender is the secured party whether as mortgagee,
beneficiary or otherwise, Borrower shall keep the Collateral free and clear of
any security interest, lien or encumbrance of any kind and Borrower shall no
sell, assign (by operation of law or otherwise) exchange or otherwise dispose of
any of the Collateral.
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(d) Insurance. Borrower shall procure and continuously maintain and pay for
(a) all risk physical damage and property insurance covering loss or damage to
the equipment for not less than the full replacement value thereof naming Lender
as loss payee and (b) bodily injury and property damage combined single limit
liability insurance, all in such amounts and against such risks and hazards as
are reasonably required by Lender, with insurance companies and pursuant to
contracts or policies and with deductibles satisfactory to Lender. All contracts
and policies shall include provisions for the protection of Lender
notwithstanding any act or neglect of or breach or default by Borrower, shall
provide for payment of property insurance proceeds to Lender, shall provide that
they may not be modified, terminated or canceled unless Lender is given at least
thirty (30) days' advance written notice thereof, and shall provide that the
coverage is "primary coverage" for the protection of Borrower or Lender
notwithstanding any other coverage carried by Lender protecting against similar
risks. Borrower shall promptly notify any appropriate insurer and Lender of each
and every occurrence, which may become the basis of a claim or cause of action
against the insured and provide Lender with all data pertinent to such
occurrence. Borrower shall furnish Lender with certificates of such insurance or
copies of policies upon request and shall furnish Lender with renewal
certificates not less than thirty (30) days prior to the renewal date. Proceeds
of all property insurance are payable first to Lender to the extent of its
interest.
(e) Financing Statements. At the request of Lender, Borrower will join Lender
in executing one or more financing statements pursuant to the Uniform Commercial
Code and other documents deemed necessary by Lender under applicable law to
record or perfect its security interest in the Collateral, including
continuation statements, in form satisfactory to Lender and will pay the cost of
filing the same in all public offices wherever filing is deemed by Lender to be
necessary or desirable. Borrower hereby authorizes Lender, in such jurisdictions
where such action is authorized by law, to effect any such recordation or filing
of financing statements or other documents without Borrower's signature thereto.
(f) Change of Name or Address. Borrower will immediately notify Lender in
writing of any change in its place of business or the adoption or change of any
tradename or fictitious business name, and will upon request of Lender, execute
any additional financing statements or other similar documents necessary to
perfect or maintain its security interest.
(g) Use of Equipment, Maintenance. Borrower will cause the Equipment to be
used in a careful and proper manner, will comply with and conform to all
governmental laws, rules and regulations relating thereto, and will cause the
Equipment to be operated in accordance with the manufacturer's or supplier's
instructions or manuals and only by competent and duly qualified personnel.
Borrower will cause the Equipment to be kept and maintained in good repair,
condition and working order and will furnish all parts, replacements,
mechanisms, devices and servicing required therefor so that the value, condition
and operating efficiency thereof will at all times be maintained and preserved,
normal wear and tear excepted. All such repairs, parts, mechanisms, devices and
replacements shall immediately, without further act, become part of the
Equipment and subject to the security interest created by this Loan and Security
Agreement. Borrower will not make any improvement, change, addition or
alteration to the Equipment if such improvement, change, addition or alteration
will impair the originally intended function or use of the Equipment or impair
the value of the Equipment as it existed immediately prior to such improvement,
change, addition or alteration. Any part added to the Equipment in connection
with any improvement, change, addition or alteration shall immediately, without
further act, become part of the Equipment and subject to the security interest
created by this Loan and Security Agreement.
(h) Inspection. Lender may at any reasonable time or times inspect the
Equipment and may at any reasonable time or times inspect the books and
records of Borrower.
(i) Taxes. Borrower shall promptly pay, when due, all charges, fees,
assessments and taxes (excluding all taxes measured by Lender's income) which
may now or hereafter be imposed upon the ownership, leasing, possession,, sale
or use of the Collateral. Borrower may, in good-faith and by proper proceedings,
contest taxes and assessment for
which Borrower has created an appropriate reserve in accordance with generally
accepted accounting principles consistently applied, so long as any such contest
does not result in a lien being imposed on any of the Collateral.
(j) Performance by Lender. If Borrower fails to perform any agreement or
obligation contained herein, Lender may itself perform, or cause the performance
of such agreement or obligation. Borrower will pay, or reimburse Lender, on
demand, for any and all fees, including attorneys' fees, costs and expenses of
whatever kind or nature incurred by Lender in connection with (i) the creation,
preservation and protection of Lender's security interest in the Collateral,
including, without limitation, all fees and taxes in connection with the
recording or filing of instruments and documents in public offices, (ii)
payments or discharge of any taxes or liens upon or in respect of the
Collateral, (iii) premiums for insurance with respect to the Equipment and (iv)
this Loan and Security Agreement and with protecting, maintaining or preserving
the Collateral and Lender's interests therein, whether through judicial
proceedings or otherwise, or in connection with defending or prosecuting any
actions, suits or proceedings arising out of or related to the Loan and Security
Agreement and the Loan Documents or in connection with any debt restructuring,
loan workout negotiations or bankruptcy or insolvency case or proceedings. All
such amounts shall constitute obligations of Borrower secured by the Collateral.
In the event that Borrower fails to perform any of its agreements contained
herein, Borrower will, on demand, reimburse Lender for all such expenditures,
together with interest thereon from the date of such expenditure until fully
reimbursed at the rate of one percent (1%) per month on the outstanding balance
of such expenditures or the highest rate permitted by law, whichever is less.
(k) Power of Attorney. Borrower hereby irrevocably appoints Lender Borrower's
attorney-in-fact with full authority in the place and stead of Borrower and in
the name of Borrower or otherwise, from time to time in the Lenders discretion,
to take any action and to execute any instrument which Lender may deem necessary
or advisable to accomplish the purposes of this Loan and Security Agreement,
including, without limitation: (i) to obtain, compromise and adjust insurance
required to be paid to Lender; (ii) to ask, demand, collect, sue for, recover,
receive, and give acquittance and receipts for moneys due and to become due
under or in respect of any of the Collateral; (iii) to receive, endorse, and
collect any drafts or other instruments, documents, and chattel paper in
connection with clause (i) or (ii) above; and (iv) to file any claims or take
any action or institute any proceedings which Lender may deem necessary or
desirable for the collection of any of the Collateral or otherwise to enforce
the rights of Lender with respect to any of the Collateral.
(l) No Duties. The powers conferred on Lender hereunder am solely to protect
its interest in the Collateral and shall not impose any duty upon it to exercise
any such powers. Except for the safe custody of any Collateral in its possession
and the accounting for moneys
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actually received by it hereunder, Lender shall have no duty as to any
Collateral or as to the taking of any necessary steps to preserve right against
prior parties or any other rights pertaining to any Collateral.
(m) Financial Data. Borrower will furnish to Lender and will cause any
guarantor of Borrower's obligations to furnish to Lender on request (i) annual
balance sheet and profit and loss statements prepared in accordance with
generally accepted accounting principles and practice consistently applied and,
if Lender so requires, accompanied by the annual audit report of an Independent
certified public accountant reasonably acceptable to Lender, and (ii) all either
financial information and reports that Lender may from time to time reasonably
request including, if Lender so requires, income tax returns of Borrower and any
guarantor of Borrower's obligations hereunder.
7. CONDITIONS OF BORROWING. Lender shall not be obligated to make any loan
hereunder unless:
(a) The Interim Notes or Term Notes evidencing such loan shall have been duly
executed and delivered to Lender.
(b) Borrower shall have executed and delivered to Lender the Supplemental
Security Agreement describing the Collateral and stating except with respect to
progress payment fundings, the location thereof;
(c) Except with respect to progress payment fundings, Lender shall have
received evidence (as described in Section 6d hereof) that insurance has been
obtained in accordance with the provisions of this Loan and Security Agreement;
(d) Lender shall have received any and all third party consents, waivers or
releases deemed necessary or desirable by it in connection with the loan and the
Collateral being financed, including, without limitation, Uniform Commercial
Code lien releases and the consent and waiver, in form and substance
satisfactory to Lender, of each and every realty owner, landlord and mortgagee
holding an interest in or encumbrance on the real property where any of the
Collateral is to be located;
(e) All filings, recordings and other actions deemed necessary or desirable by
Lender in order to establish, protect, pro-serve and perfect its security
interest in the Collateral being financed by such loan as a valid perfected
first priority security interest shall have been duly effected, Including.
without limitation, the filing of financing statements and the recordation of
landlord (owners) and/or mortgages waivers or disclaimers, all in form and
substance satisfactory to Leader, and all fees, taxes and other charger relating
to such filings and recordings shall have been paid by Borrower;
(f) The representations and warranties contained in this Loan and Security
Agreement shall be true and correct in all respects on and as of the date of the
making of any loan hereunder with the same effect as if made on and as of such
date;
(g) In the sole judgment of Lender, there shall have been no material adverse
change in the financial condition, business or operations of Borrower from the
most recent date of any financial statement, credit report, business report or
similar document submitted to Lender for its review;
(h) All Loan Documents shall be satisfactory to Lender's attorneys; and
(i) Lender shall have received, in form and substance satisfactory to Lender,
such other documents as Lender shall require including, but not limited to, a
Request, proof of payment, vendor invoices and certificates of authority and
incumbency.
8. DEFAULT. The occurrence of any of the following events, following the
giving of any required notice and/or the expiration of any applicable period of
grace, shall constitute an event of default ("Event of Default") hereunder:
(a) Borrower's default in payment of any Installment of the principal of or
interest on any Interim Note or Term Note when and after the
same shall become due and payable, whether at the due date thereof or by
acceleration or otherwise, which default shall continue unremedied for ton (10)
days after receipt by Borrower of written notice thereof; or
(b) The failure by Borrower to make payment of any other amount payable
hereunder or under any Interim Note or Term Note, and the continuance of such
failure for more than ten (10) days after written notice thereof by Lender to
Borrower; or
(c) The failure by Borrower to perform or observe any covenant, condition,
obligation or agreement to be performed or observed by it hereunder, which
failure shall continue unremedied for thirty (30) days after written notice
thereof by Lender to Borrower; or
(d) The occurrence of a default described in Section 4 hereof; or
(e) Any warranty, representation or statement made or furnished with respect to
the Borrower or the Collateral to Lender by or on behalf of Borrower, in
connection with this Loan and Security Agreement, or the indebtedness secured
hereby, shall prove to have been false in any adverse, material respect when
made or furnished; or
(f) Borrower shall become insolvent or bankrupt or make an assignment for the
benefit of creditors or consent to the appointment of a trustee or receiver; or
a trustee or a receiver shall be appointed for Borrower or for a substantial
part of its property without its consent and shall not be dismissed for a period
of sixty (60) days; or bankruptcy, reorganization, liquidation, insolvency or
dissolution proceedings shall be instituted by or against Borrower and, if
instituted against Borrower, shall be consented to or be pending and not
dismissed for a period of sixty (60) days; or any execution or writ of process
shall be issued under any action or proceeding against Borrower in such capacity
whereby any of the Collateral may be taken or restrained; Borrower shall cease
doing business as a going concern; or, without the prior written Consent of
Lender, Borrower shall sell, transfer or dispose of all or substantially all of
its assets or property (excluding, however, any transfer of cash or stock to
acquire a business, if such acquisition does not constitute an Event of Default
under Section 8(h) and any sole of all or substantially all of Borrower's assets
or property that does not constitute an Event of Default under section 8(i)); or
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(g) The liquidation, consolidation, reorganization (excluding, however, any
acquisition by Borrower of a business for cash or stock, if such acquisition
does not constitute an Event of Default under Section 8(h) and any merger that
does not constitute an Event of Default under Section 8(i)), conversion to an
"S" status or dissolution, if Borrower is a corporation or partnership, of
Borrower, if in Lender's reasonable opinion, such act shall materially and
adversely affect Borrower's ability to perform under any of the Loan Documents:
or
(h) Without Lender's consent, Borrower (i) acquires another business for cash
in excess of (A) $5,000,000 prior to Borrower's initial pubic offering or (B)
$15,000,000 thereafter, or (ii) acquires another business for stock if such
acquisition would result in a material reduction of Borrower's tangible net
worth; or
(i) Without Lender's consent, which shall be given or withheld based on
Lender's good faith analysis of the credit quality of Borrower's successor and
shall not be unreasonably withheld, Borrower (1) sells all or substantially all
of its assets and, in conjunction therewith, assigns its obligations under this
Loan and Security Agreement without complying with Section 13 hereof, or (2)
merges with another entity; provided that, in the event Lender withholds such
consent, the Term Loans may be prepaid without penalty or premium; or
(j) Any item of Collateral is seized or levied on under legal or governmental
process or for any reason Lender deems itself insecure. Lender shall be entitled
to deem itself insecure when some event occurs, fails to occur or is threatened
or some objective condition exists or is threatened which significantly impairs
the prospects that any of Borrower's obligations to Lender will be paid when due
or which significantly impairs the value of the Collateral to Lender.
The occurrence of an Event of Default shall terminate any commitment or
obligation by Lender to make any of the loans contemplated by this Loan and
Security Agreement.
9. REMEDIES UPON DEFAULT. Upon the occurrence of an Event of Default
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hereunder, Lender may, at its option, do any one or more of the following:
(a) Declare all obligations of Borrower to Lender to be immediately due and
payable, whereupon all unpaid principal of and interest on said indebtedness and
other amounts declared due and payable shall be and become immediately due and
payable;
(b) Take possession of all or any of the Collateral and exclude therefrom
Borrower and all others claiming under Borrower, and thereafter hold, store,
use, operate, manage, maintain and control, make repairs, replacements,
alterations, additions and improvements to and exercise all rights and powers of
Borrower in respect to the Collateral or any part thereof. In the event Lender
demands, or attempts to take possession of the Collateral in the exercise of any
rights under this Loan and Security Agreement, Borrower promises and agrees to
promptly turn over and deliver complete possession thereof to Lender;
(c) Require Borrower to assemble the Collateral, or any portion thereof, at a
place designated by Lender and reasonably convenient to both parties, and
promptly to deliver such Collateral to Lender, or an agent or representative
designated by it;
(d) Sell, lease or otherwise dispose of the Collateral at public or private
sale, without having the Collateral at the place of sale, and upon terms and in
such manner as Lender may determine (and Lender may be a purchaser at any sale);
and
(e) Exercise any remedies of a secured party under the Uniform Commercial Code
as adopted in the state where the Collateral is located or any other applicable
law.
Except as to portions of the Collateral which are perishable or threaten to
decline speedily in value or are of a type customarily sold on a recognized
market, Lender shall give Borrower at least ten (10) days' prior written notice
of the time and place of any public or private sale of the Collateral or other
intended disposition thereof to be
made. Such notice may be mailed to Borrower at the address set forth in the
first paragraph of this Loan and Security Agreement. Borrower hereby
specifically agrees (to the extent that applicable law and public policy allows
it to effectively do so) that any public or private sale held in accordance with
the terms of this Loan and Security Agreement shall, for the purpose of the
Uniform Commercial Code as adopted in the state where the Collateral is located
and for all other purposes, be deemed to have been conducted in a commercially
reasonable manner and in good faith.
The proceeds of any sale under Section 9(d) shall be applied as follows:
(i) To the repayment of the costs and expenses of retaking, holding and
preparing for the sale and the selling of the Collateral (including legal
expenses and attorneys' fees) and the discharge of all assessments,
encumbrances, charges or liens, if any, on the Collateral prior to the lien
hereof (except any taxes. assessments, encumbrances, charges or liens subject to
which such sale shall have been made);
(ii) To the payment of the whole amount then due and unpaid of the
indebtedness of Borrower to Lender;
(iii) To the payment of other amounts then secured hereunder; and
(iv) The surplus, if any, shall be paid to the Borrower or to whomsoever
may be lawfully entitled to receive the same.
Lender shall have the right to enforce one or more remedies hereunder,
successively or concurrently, and such action shall not operate to stop or
prevent Lender from pursuing any further remedy which it may have, and any
repossession or retaking or sale of the Collateral pursuant to the terms hereof
shall not operate to release Borrower until full payment of any deficiency has
been made in cast
10. LIMITATION ON INTEREST. It is the intent of the parties to this Loan and
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Security Agreement to contract in strict compliance with applicable usury laws
from time to time in effect. In furtherance thereof, the parties stipulate and
agree that none of the terms and provisions contained in the Loan Documents
shall ever be construed to create a contract to pay for the use, forbearance or
detention of money at a rate in excess of the maximum interest rate permitted to
be charged by applicable law from time to time in effect.
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11. PERSONAL PROPERTY/TAGS. No item of Equipment will be attached or affixed
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to realty or any building without Lender's prior knowledge and written consent
and waiver of the landlord and the mortgagee, if any, of the real property. If
so requested by Lender, Borrower will affix tags supplied by Lender, reflecting
Lenders security interest in the Equipment.
12. LOSS AND DAMAGE. Borrower shall bear the risk of damage, loss, theft, or
---------------
destruction, partial or complete of the Equipment, whether or not such loss or
damage is covered by insurance, Lender agrees to apply toward payment of
obligations of Borrower insurance proceeds payable to Lender by reason of such
damage, loss, theft, or destruction. In the event of any damage, loss, theft,
or destruction, partial or complete, of any item of Equipment, Borrower shall
promptly notify Lender in writing and at the option of Lender (a) repair or
restore the Equipment to good condition and working order, or (b) replace the
Equipment with similar equipment in good repair, condition and working order, or
(c) pay Lender, in cash, an amount equal to the unamortized equipment cost for
the item or if the Equipment was not purchased with the loan proceeds, the pro
rata portion of the outstanding principal balance due under the Interim Note or
Term Note, as the case may be, and all other amounts relating to that item of
Equipment then due and owing hereunder, and upon payment of that amount,
Lender's lien shall be terminated with respect to that item of Equipment only,
and Lender will release its interest in that item of Equipment.
13. ASSIGNMENT. Without Lender's consent, which shall be given or withheld
----------
based on Lender's good faith analysis of the credit quality of Borrower's
assignee and shall not be unreasonably withheld, Borrower may not assign or
transfer any rights under this Loan and Security Agreement or to the Collateral.
14. INDEMNIFICATION. Borrower shall indemnify and hold harmless Lender from
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and against any and all claims, losses, liabilities, causes of action, costs and
expenses (including the fees of Lender's attorneys) ("Claims") in any way
relating to or arising out of this Loan and Security Agreement, the other Loan
Documents or the Collateral, except for any Claims resulting solely and directly
from Lender's gross negligence or willful misconduct.
15. NOTICES. Whenever Borrower or Lender shall desire to give or serve any
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notice, demand, request or other communication with respect to this Loan and
Security Agreement, each such notice, demand, request or communication shall be
in writing and shall be effective only if the same is physically delivered or is
by certified mail, postage prepaid, return receipt requested, or by overnight
courier, postage prepaid. mailed to the parties at the addresses set forth in
the first paragraph of this Loan and Security Agreement, with a copy to Lender's
Vice President of Credit. Any party hereto may change its address for such
notices by delivering or mailing to the other parties hereto, as aforesaid, a
notice of such change.
16. NO WAIVER BY LENDER. By exercising or failing to exercise any of its
-------------------
rights, options or elections hereunder, lender shall not be deemed to have
waived any breach or default on the part of Borrower or to have released
Borrower from any of the obligations secured hereby, unless such waiver or
release is in writing and is signed by Lender. In addition, the waiver by Lender
of any breach hereof for default in payment of an indebtedness secured hereby
shall not be deemed to constitute a waiver of any succeeding breach or default.
17. FURTHER AGREEMENTS. From time to time, Borrower will execute such further
------------------
instruments as Lender may reasonably require, in order to protect, preserve, and
maintain the security interest granted hereby.
18. BINDING UPON SUCCESSORS. All agreements, covenants, conditions and
-----------------------
provisions of this Loan and Security Agreement shall apply to and bind the
successors and assigns of all parties hereto.
19. GOVERNING LAWS. This Loan and Security Agreement shall be governed by the
--------------
laws of the State of Washington.
20. AMENDMENT. This Loan and Security Agreement can be modified or rescinded
---------
only by a writing expressly referring to this Loan and Security Agreement,
signed by both of the parties hereto.
21. INVALIDITY OF PROVISIONS. Every provision of this Loan and Security
------------------------
Agreement is intended to be severable. In the event that any term or provision
hereof is declared by a court to be illegal or invalid for any reason
whatsoever, such illegality or invalidity shall not affect the balance of the
terms and provisions hereof, which terms and provisions shall remain binding and
enforceable, then to the extent possible all of the other provisions shall
nonetheless remain in full force and effect.
IN WITNESS WHEREOF: Borrower and Lender have duly executed this Loan and
Security Agreement the day and year first above written.
Lender: MetLife Capital Corporation Borrower: PointCast Incorporated
By: /s/ Mitch Stevens By: /s/ Philip J. Koen
(Print Name): Mitch Stevens (Print Name): Philip J. Koen
Title: Vice President Title: Snr VP & CFO
Social Security Number
(If Borrower is an individual)
FEIN:
CERTIFICATE OF
CORPORATE RESOLUTION
The undersigned, being the Secretary _________ of PointCast Incorporated
("Company"), a corporation duly organized and validly existing under the laws of
the State of California, hereby certifies that the following resolution was duly
adopted in accordance with the articles of incorporation and bylaws of the
Company at a meeting of the Board of Directors of the Company held on November
18, 1997 and that the same has not been modified or rescinded and is in full
force and effect:
"RESOLVED that it is in the best interests of the Company to borrow in the
name of the Company from METLIFE CAPITAL CORPORATION ("MetLife"), and further
resolved that any one [1] of the following named officers of the, Company
is(are) authorized to pledge or mortgage for and on behalf of the Company such
personal or real property as this Company may now own or hereafter purchase or
in which it may now have or hereafter acquire any interest, to secure the
payment of any loans or other indebtedness or liability to MetLife and to
execute, on behalf of the Company, a loan and security agreement and any addenda
or amendments thereto, any promissory notes, and any other related instruments
and documents that MetLife may require in the course of its dealings with the
Company, in such form and substance as are deemed to be appropriate by such
officer(s), such determination to be conclusively evidenced by such officer(s)
execution thereof.
Names Titles Signatures
(Print or Type) (Print or Type)
Philip Koen Chief Financial Officer /s/ Philip J. Koen
Jacklyn A. Karceski Controller /s/ Jacklyn A. Karceski
"Resolved further that this resolution is intended to and does confer upon
the above named officers a general authority to deal with MetLife on behalf and
in the name of the Company, and this resolution shall apply to all transactions
of the Company with MetLife without specifically enumerating them herein. Any
and all actions taken by any officer of the Company in connection herewith prior
to the date of this resolution are hereby ratified, approved and confirmed in
all respects. This resolution shall continue in full force and effect until
notice in writing of its revocation shall be given to and received by MetLife."
The undersigned further certifies that the signatures appearing opposite
the names of the officers in the foregoing resolution the signatures of such
individuals and that such individuals hold the offices indicated above.
IN WITNESS WHEREOF the undersigned has executed this certificate and
affixed the corporate set of the Company thereto this 18th day of November, 1997
(Corporate Seal) /s/ Philip J. Koen
Secretary
No. 89.001 TERM PROMISSORY NOTE
3,346,590.16 November 18, 1997
FOR VALUED RECEIVED, the undersigned PointCast Incorporated, ("Maker"),
promises to pay to the order of MetLife Capital Corporation, ("Payee"), at its
office at P.O. Box C-97550, Bellevue, Washington 98009, the principal sum of
Three Million Three Hundred Forty-Six Thousand Five Hundred Ninety and 16/100
($3,346,590.16) Dollars together with interest on unpaid principal from the date
of disbursement of such principal amount until payment in full at a rate of Nine
and 70/100 percent (9.70%) per annum ("Rate") computed on the basis of a 360 day
year of twelve consecutive thirty day months. Interest hereunder shall be paid
on the unpaid principal, together with principal, in Thirty-Six (36)
installments of One Hundred Six Thousand Six Hundred Fifty-Two and 20/100
($106,652.20) commencing on November 21, 1997 and monthly thereafter until
October 21, 2000, on which date the entire balance of principal and interest
unpaid shall be due and payable. It is agreed that each installment, when paid,
shall be applied by the holder hereof, first so much as shall be required to the
payment of interest accrued as specified hereto, and the balance thereof to the
repayment of the principal sum.
The Rate expressed above will be adjusted at Loan Closing in accordance
with the following formula: The interest rate shall be fixed at 399 basis
points (3.99%) over the then weekly average yield of Two (2) year U.S. Treasury
Constant Maturities as published in the Federal Reserve Statistical Release H.
15[519].
Except as may be otherwise expressly provided herein, this Note may not be
prepaid in whole or in part, except with the prior written consent of Payee.
Maker shall have the privilege of prepaying all (but not part) of the then
outstanding balance under this Note on September 21, 1999 or on any installment
due date thereafter, subject to giving thirty (30) days prior written notice to
Payee specifying the date of prepayment and further subject to payment of a
prepayment premium equal to the amount, if any, required to offset the adverse
impact to Payee of any decline in interest rates. The prepayment premium is
determined by (i) calculating the decrease, expressed in basis points (but not
less than zero) in the current weekly average yield for Two (2)-year U.S.
Treasury Constant Maturities as published in Federal Reserve Statistical Release
-----------------------------------
15(519) (the
"Index") from the weekly average yield of 5.71% as of November 21, 1997 to the
Friday (or, if Friday is not a business day, the last business day) of the week
immediately preceding the prepayment date (ii) dividing the difference by 100,
(iii) multiplying the result by the applicable "Premium Factor" set forth below,
and (iv) multiplying the product by the principal to be prepaid. Any prepayment
shall be applied first to the prepayment premium, if any, next to accrued
interest and late charges (if any), and thereafter to the principal when
outstanding. The Premium Factor shall be the amount shown on the following
chart for the month in which prepayment occurs.
NUMBER OF MONTHS REMAINING (YEARS) PREMIUM FACTOR
18 - 13 (2) .010
12 - 1 (1) .005
In the event the Federal Reserve Board ceases to publish Statistical Release H
15(519), then the decrease in Two (2)-Year U.S. Treasury Constant Maturities
will be determined from another source designated by Payee.
If Maker shall have given to Payee notice of Makers intention to so prepay,
Maker Shall not then be entitled to withdraw such notice, and the indebtedness
proposed to be prepaid in such notice together with the aforesaid prepayment
fee, if applicable, shall be due and payable upon the date specified for such
prepayment in such notice. Upon the occurrence of an Event of Default and
acceleration of payment of indebtedness evidenced hereby during a period open to
prepayment, Maker shall pay to Payee, in addition to any and all other sums due
and payable hereunder, as liquidated damages for the loss of Payee's investment
and not as a penalty, an amount equal to the prepayment fee which would have
been payable hereunder in such date of acceleration in the event of a
voluntary prepayment. Maker and Payee agree that the foregoing amounts do not
constitute penalties but rather constitute reasonable calculations of the
investment loss that would be sustained by Payee in the event of such
prepayment.
It is specifically understood and agreed by Maker that, in the event of a
default under this Note or under any instrument securing the Note, a tender of
payment of the unpaid principal and accrued interest then outstanding shall be
deemed a prepayment, and, accordingly, said tender must include the premium
herein above required, or if said tender is made prior to the time this
privilege is operative, then said tender must include a premium equal to six (6)
months' interest at the Rate computed on the principal amount so tendered. It
is further understood and agreed by Maker that Payee shall not be obligated to
accept said tender, and said tender shall for all purposes be deemed ineffectual
and deficient, unless said tender shall include the premium herein above
required.
In the event that Payee does not receive any payment on the date due, Maker
will pay Payee a late charge of five percent (5%) of the payment outstanding
together with the payment and, provided said sum is received within ten (10)
days of the date due, Payee agrees not to demand immediate payment of the whole
sum of principal and interest as otherwise permitted herein.
If, from any circumstances whatsoever, payment of any obligation due under
this Note at the time such performance shall be due shall involve exceeding the
maximum amount currently prescribed by any applicable usury statute or any other
applicable law, then such obligation shall be reduced to such maximum amount, so
that in no event shall any payment be possible under this Note, or under any
other instrument evidencing or securing the indebtedness evidenced hereby, that
is in excess of such maximum amount.
In the event that an Event of Default shall occur under the Loan and
Security Agreement (as hereinafter defined) or any other instrument now or
hereafter securing repayment hereof, following any required notice and/or the
expiration of any applicable period of grace, then, and in such event, the
principal indebtedness evidenced hereby, and any other sums advanced hereunder,
together with all unpaid interest accrued thereon, shall, at the option of
Payee, at once become due and payable and may be collected forthwith, regardless
of the stipulated date of maturity. TIME IS OF THE ESSENCE WITH RESPECT TO THIS
NOTE. Interest shall accrue on the outstanding principal for so long as such
default continues, regardless of whether or not there has been an acceleration
of the indebtedness evidenced hereby as set forth herein, at the rate equal to
the lesser of fifteen percent (15%) per annum or the maximum rate allowable
under law. All such interest shall be paid at the time of and as a condition
precedent to the curing of any such default should Payee, at its sole option,
allow such default to be cured. In the event this Note, or any part thereof, is
collected by or through an attorney-at-law, Maker agrees to pay all costs of
collection including, but not limited to, reasonable attorneys' fees, whether or
not suit is filed.
This Note is one of the notes referred to in and is Secured by the Loan and
Security Agreement dated November 18, 1997 between Maker and Payee. The terms of
the Loan and Security Agreement are incorporated herein by reference.
Maker waives any right of exemption and waives presentment, protest and
demand and notice of protest, demand and of dishonor and nonpayment of this
Note, and consents that any holder hereof shall have the right, without notice,
to grant any extension or extensions of time for payment of this Note or any
part thereof or any other indulgences or forbearances whatsoever, or may release
any of the security for this Note without in any way affecting the liability of
any other party for the payment of this Note.
The due payment and performance of Maker's obligations hereunder shall be
without regard to any counterclaim, right of offset or any other counterclaim
whatsoever which Maker may have against Payee and without regard to any other
obligations of any nature whatsoever which Payee may have to Maker, and no such
counterclaim or offset shall be asserted by Maker in any action, suit or
proceeding instituted by Payee for payment of Maker's obligations hereunder.
This Note and the Loan and Security Agreement shall be governed by and
construed in accordance with the laws of the State of Washington.
Maker acknowledges that there is no presumption that the value of the
property securing this Note is equal to the face amount of the Note, and that a
deficiency judgment may be necessary In proceedings taken for enforcement
hereof.
No amendment to this Note shall be binding upon Payee unless it is in
writing and duly signed by Payee.
IN WITNESS WHEREOF, the Maker has caused these presents to be duly signed
the date first above written.
Borrower: PointCast Incorporated
By: /s/Philip J. Koen
Witness: (Print Name) Philip J. Koen
Title: Snr VP & CFO