CREDIT AGREEMENT
Exhibit 99.1
THIS CREDIT AGREEMENT (this “Agreement”) is entered into as of August 17, 2011, by and
between SYNAPTICS INCORPORATED, a Delaware corporation (“Borrower”), and XXXXX FARGO BANK,
NATIONAL ASSOCIATION (“Bank”).
Borrower has requested that Bank extend or continue credit to Borrower as described below,
and Bank has agreed to provide such credit to Borrower on the terms and conditions contained
herein.
(a) Line of Credit. Subject to the terms and conditions of this Agreement, Bank hereby agrees
to make advances to Borrower from time to time up to and including September 1, 2012, not to exceed
at any time the aggregate principal amount of Fifty Million Dollars ($50,000,000.00) (“Line of
Credit”), the proceeds of which shall be used to finance Borrower’s working capital requirements.
Borrower’s obligation to repay advances under the Line of Credit shall be evidenced by a promissory
note dated as of August 17, 2011 (“Line of Credit Note”), all terms of which are incorporated
herein by this reference.
(b) Letter of Credit Subfeature. As a subfeature under the Line of Credit, Bank agrees from
time to time during the term thereof to issue or cause an affiliate to issue standby letters of
credit for the account of Borrower (each, a “Letter of Credit” and collectively, “Letters of
Credit”); provided however, that the aggregate undrawn amount of all outstanding Letters of Credit
shall not at any time exceed Five Million Dollars ($5,000,000.00). The form and substance of each
Letter of Credit shall be subject to approval by Bank, in its sole discretion. Each Letter of
Credit shall be issued for a term not to exceed three hundred sixty-five (365) days, as designated
by Borrower; provided, however, that in the event that the Line of Credit is not renewed or
extended beyond its then applicable maturity date, Borrower shall deliver to Bank cash or cash
equivalents in an amount equal to the amount available to be drawn under then outstanding Letters
of Credit, which amount shall be maintained in an account with Bank as collateral for Borrower’s
obligations under such Letters of Credit. The undrawn amount of all Letters of Credit shall be
reserved under the Line of Credit and shall not be available for borrowings thereunder. Each Letter
of Credit shall be subject to the additional terms and conditions of the Letter of Credit
agreements, applications and any related documents required by Bank in connection with the issuance
thereof. Each drawing paid under a Letter of Credit shall be deemed an advance under the Line of
Credit and shall be repaid by Borrower in accordance with the terms and conditions of this
Agreement applicable to such advances; provided however, that if advances under the Line of Credit
are not available, for any reason, at the time any drawing is paid, then Borrower shall immediately
pay to Bank the full amount drawn, together with interest thereon from the date such drawing is
paid to the date such amount is fully repaid by Borrower, at the rate of interest applicable to
advances under the Line of Credit. In
such event Borrower agrees that Bank, in its sole discretion, may debit any account maintained by
Borrower with Bank for the amount of any such drawing.
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(c) Borrowing and Repayment. Borrower may from time to time during the term of the Line of
Credit borrow, partially or wholly repay its outstanding borrowings, and reborrow, subject to all
of the limitations, terms and conditions contained herein or in the Line of Credit Note; provided
however, that the total outstanding borrowings under the Line of Credit shall not at any time
exceed the maximum principal amount available thereunder, as set forth above.
(a) Interest. The outstanding principal balance of each credit subject hereto shall bear
interest, and the amount of each drawing paid under any Letter of Credit shall bear interest from
the date such drawing is paid to the date such amount is fully repaid by Borrower, at the rate of
interest set forth in each promissory note or other instrument or document executed in connection
therewith.
(b) Computation and Payment. Interest shall be computed on the basis of a 360-day year,
actual days elapsed. Interest shall be payable at the times and place set forth in each promissory
note or other instrument or document required hereby.
“Loan Documents” means this Agreement and each promissory note, contract, instrument and other
document required hereby or at any time hereafter delivered to Bank in connection herewith.
“Material Adverse Effect” means (a) a material adverse effect on the business, properties,
operations or condition (financial or otherwise) of the Borrower and its Subsidiaries taken as a
whole, (b) an material impairment of Borrower’s ability to repay its obligations to Bank, (c) a
material adverse effect on the legality, validity or enforceability of this Agreement or the other
Loan Documents.
“Other Assets” means all assets now owned or hereafter acquired by Borrower or any of its
Subsidiaries, excluding Restricted Assets.
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“Permitted Liens” means such of the following as to which no enforcement, collection,
execution, levy or foreclosure proceeding shall have been commenced: (a) liens described on
Schedule 1 attached hereto and incorporated herein by reference, (b) liens for taxes,
assessments and governmental charges or levies not yet due and payable; (c) liens imposed by law,
such as materialmen’s, mechanics, carriers, workmen’s and repairmen’s liens and other similar liens
arising in the ordinary course of Borrower’s business securing obligations that are not overdue for
a period of more than 30 days; (d) pledges or deposits to secure obligations under workers’
compensation laws or similar legislation or to secure public or statutory obligations; (e)
easements, rights of way and other encumbrances on title to real property that do not render title
to the property encumbered thereby unmarketable or materially adversely affect the use of such
property for its present purposes, and (f) purchase money liens on Other Assets acquired by
Borrower or any Subsidiary in the ordinary course of business provided that each such lien attaches
to the acquired property concurrently with its acquisition and the principal amount of all
indebtedness secured by such purchase money liens shall not exceed in the aggregate of
$5,000,000.00.
“Permitted Acquisition” means the acquisition by Borrower or a Subsidiary of (a) all or
substantially all the assets of another entity, of a division of another entity or of an
identifiable line of business of another entity, or (b) more than 50% of the common stock of
another corporation or of the equity interests of any other form of entity, provided that, in each
case (i) such acquisition is approved by the Board of Directors (or other governing body) of the
corporation or other entity whose assets or equity interests are being acquired, (ii) Borrower is
in compliance with all terms and conditions of this Agreement prior to such acquisition and would
remain in pro forma compliance therewith following such acquisition, as evidenced by a certificate
of pro forma compliance delivered to Bank prior to such acquisition (which shall also demonstrate
pro forma compliance with the Required Liquidity Level), (iii) the assets acquired are used in or
the entity acquired is in generally the same line(s) of business as Borrower and its Subsidiaries
as of the date of this Agreement, and (iv) immediately following such acquisition, the Required
Liquidity Level would be and is maintained.
“Required Liquidity Level” means Borrower’s unrestricted and unencumbered cash, cash
equivalents and marketable securities of not less than $125,000,000.00 plus an amount equal to the
outstanding balance of the Line of Credit on the applicable date of determination.
“Restricted Assets” means all accounts receivable, inventory and intellectual property now
owned or hereafter acquired by Borrower or any of its Subsidiaries.
“Subsidiary” means, in respect of Borrower, a corporation or other business entity the shares
constituting a majority of the outstanding capital stock (or other form of ownership) or
constituting a majority of the voting power in any election of directors (or shares constituting
both majorities) of which are (or upon the exercise of any outstanding warrants, options or other
rights would be) owned directly or indirectly at the time in question by such entity or another
subsidiary of such entity or any combination of the foregoing. As of the date hereof, the entities
named in Schedule II hereto are the only Subsidiaries of Borrower.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
REPRESENTATIONS AND WARRANTIES
Borrower makes the following representations and warranties to Bank, which representations and
warranties shall survive the execution of this Agreement and shall continue in full force and
effect until the full and final payment, and satisfaction and discharge, of all obligations of
Borrower to Bank subject to this Agreement.
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ARTICLE III
CONDITIONS
CONDITIONS
(a) Approval of Bank Counsel. All legal matters incidental to the extension of credit by Bank
shall be satisfactory to Bank’s counsel.
(b) Documentation. Bank shall have received, in form and substance satisfactory to Bank,
each of the following, duly executed:
(i) | This Agreement and each promissory note or other instrument or document required hereby. | ||
(ii) | Certificate of Incumbency. | ||
(iii) | Corporate Resolution: Borrowing. |
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(iv) | Disbursement Order. | ||
(v) | Such other documents as Bank may require under any other Section of this Agreement. |
(a) Compliance. The representations and warranties contained herein and in each of the other
Loan Documents shall be true on and as of the date of the signing of this Agreement and on the date
of each extension of credit by Bank pursuant hereto, with the same effect as though such
representations and warranties had been made on and as of each such date, and on each such date, no
Event of Default as defined herein, and no condition, event or act which with the giving of notice
or the passage of time or both would constitute such an Event of Default, shall have occurred and
be continuing or shall exist.
(b) Documentation. Bank shall have received all additional documents which may be required in
connection with such extension of credit.
(c) Additional Letter of Credit Documentation. Prior to the issuance of each Letter of Credit,
Bank shall have received a Letter of Credit Agreement, properly completed and duly executed by
Borrower.
ARTICLE IV
AFFIRMATIVE COVENANTS
AFFIRMATIVE COVENANTS
Borrower covenants that so long as Bank remains committed to extend credit to Borrower
pursuant hereto, or any liabilities (whether direct or contingent, liquidated or unliquidated) of
Borrower to Bank under any of the Loan Documents remain outstanding, and until payment in full of
all obligations of Borrower subject hereto, Borrower shall, and shall cause each Subsidiary to,
unless Bank otherwise consents in writing:
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(a) not later than 120 days after and as of the end of each fiscal year, a 10K report filed
with the Security Exchange Commission;
(b) not
later than 60 days after and as of the end of each fiscal quarter, a 10Q report
filed with the Security Exchange Commission;
(c) from time to time such other information as Bank may reasonably request.
(a) Tangible Net Worth not less than ninety percent (90%) of actual Tangible Net Worth as of
fiscal year ending June 30, 2011 (minus, on a cumulative basis, the amount paid by Borrower for
stock repurchases since June 30, 2011, subject to, and as permitted under the terms of Section 5.8
below), plus one hundred percent (100%) of the net proceeds from any equity offerings after June
30, 2011, plus on a cumulative basis, ninety percent (90%) of current
quarterly net income (excluding losses) measured quarterly, with “Tangible Net Worth” defined as
the aggregate of total stockholders’ equity less any intangible assets.
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Borrower further covenants that so long as Bank remains committed to extend credit to Borrower
pursuant hereto, or any liabilities (whether direct or contingent, liquidated or unliquidated) of
Borrower to Bank under any of the Loan Documents remain outstanding, and until payment in full of
all obligations of Borrower subject hereto, Borrower will not, and will not permit any Subsidiary
to, without Bank’s prior written consent:
SECTION 5.3. OTHER INDEBTEDNESS. Create, incur, assume or permit to exist any indebtedness or
liabilities resulting from borrowings, loans or advances, whether secured or unsecured, matured or
unmatured, liquidated or unliquidated, joint or several, except (a) the liabilities of Borrower or
any Subsidiary to Bank, (b) any other liabilities of Borrower or any Subsidiary existing as of, and
disclosed to Bank prior to, the date hereof, (c) indebtedness which is subordinated to Borrower’s
indebtedness to Bank on terms acceptable to Bank and which may not be prepaid except as set forth
in the next sentence, and (d) purchase money indebtedness in an aggregate amount not to exceed
$5,000,000.00 outstanding at any time. Borrower may prepay existing convertible subordinated debt
in an amount not to exceed $2,305,000.00 as long as (a) prior to such prepayment Borrower shall
deliver to Bank a compliance certificate which demonstrates pro forma compliance with the Required
Liquidity Level, and (b) immediately following such prepayment, the Required Liquidity Level would
be and is maintained.
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SECTION 6.1. The occurrence of any of the following shall constitute an “Event of Default”
under this Agreement:
(a) Borrower or any Subsidiary shall fail to pay when due any principal, interest, fees or
other amounts payable under any of the Loan Documents.
(b) Any financial statement or certificate furnished to Bank in connection with, or any
representation or warranty made by Borrower or any other party under this Agreement or any other
Loan Document shall prove to be incorrect, false or misleading in any material respect when
furnished or made.
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(c) Any default in the performance of or compliance with any obligation, agreement or other
provision contained herein or in any other Loan Document (other than those referred to in
subsections (a) and (b) above), and with respect to any such default which by its nature can be
cured, such default shall continue for a period of twenty (20) days from its occurrence.
(d) Any default in the payment or performance of any obligation, or any defined event of
default, under the terms of any contract or instrument (other than any of the Loan Documents)
pursuant to which Borrower, any Subsidiary or any guarantor hereunder has incurred any debt or
other liability to any person or entity, including Bank.
(e) The filing of a notice of judgment lien against Borrower, any Subsidiary or any guarantor;
or the recording of any abstract of judgment against Borrower, any Subsidiary or any guarantor in
any county in which Borrower, any Subsidiary or any guarantor has an interest in real property; or
the service of a notice of levy and/or of a writ of attachment or execution, or other like process,
against the assets of Borrower, any Subsidiary or any guarantor; or the entry of a judgment against
Borrower, any Subsidiary or any guarantor.
(f) Borrower, any Subsidiary or any guarantor shall become insolvent, or shall suffer or
consent to or apply for the appointment of a receiver, trustee, custodian or liquidator of itself
or any of its property, or shall generally fail to pay its debts as they become due, or shall make
a general assignment for the benefit of creditors; Borrower, any Subsidiary or any guarantor shall
file a voluntary petition in bankruptcy, or seeking reorganization, in order to effect a plan or
other arrangement with creditors or any other relief under the Bankruptcy Reform Act, Title 11 of
the United States Code, as amended or recodified from time to time (“Bankruptcy Code”), or under
any state or federal law granting relief to debtors, whether now or hereafter in effect; or any
involuntary petition or proceeding pursuant to the Bankruptcy Code or any other applicable state or
federal law relating to bankruptcy, reorganization or other relief for debtors is filed or
commenced against Borrower, any Subsidiary or any guarantor, or Borrower, any Subsidiary or any
guarantor shall file an answer admitting the jurisdiction of the court and the material allegations
of any involuntary petition; or Borrower, any Subsidiary or any guarantor shall be adjudicated a
bankrupt, or an order for relief shall be entered against Borrower, any Subsidiary or any guarantor
by any court of competent jurisdiction under the Bankruptcy Code or any other applicable state or
federal law relating to bankruptcy, reorganization or other relief for debtors.
(g) There shall exist or occur any event or condition which Bank in good faith believes
impairs, or is substantially likely to impair, the prospect of payment or performance by Borrower
of its obligations under any of the Loan Documents.
(h) The dissolution or liquidation of Borrower, any Subsidiary or any guarantor; or Borrower,
any Subsidiary or any guarantor, or any of its directors, stockholders or members, shall take
action seeking to effect the dissolution or liquidation of Borrower, any Subsidiary or any
guarantor.
(i) Any change in ownership of an aggregate of twenty-five percent (25%) or more of the common
stock of Borrower in any single transaction or set of related transactions.
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BORROWER: | SYNAPTICS INCORPORATED 0000 Xxxxx Xxxx. Xxxxx Xxxxx, XX 00000 |
|
BANK: | XXXXX FARGO BANK, NATIONAL ASSOCIATION Santa Xxxxx Technology Regional Commercial Banking Xxxxxx 000 X. Xxxxxx Xxxxxx, 0xx Xxxxx Xxx Xxxx, XX 00000 |
or to such other address as any party may designate by written notice to all other parties.
Each such notice, request and demand shall be deemed given or made as follows: (a) if sent by hand
delivery, upon delivery; (b) if sent by mail, upon the earlier of the date of receipt or three (3)
days after deposit in the U.S. mail, first class and postage prepaid; and (c) if sent by telecopy,
upon receipt.
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SECTION 7.10. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
(a) Arbitration. The parties hereto agree, upon demand by any party, to submit to
binding arbitration all claims, disputes and controversies between or among them (and their
respective employees, officers, directors, attorneys, and other agents), whether in tort, contract
or otherwise in any way arising out of or relating to (i) any credit subject hereto, or any of the
Loan Documents, and their negotiation, execution, collateralization, administration, repayment,
modification, extension, substitution, formation, inducement, enforcement, default or termination;
or (ii) requests for additional credit.
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(c) No Waiver of Provisional Remedies, Self-Help and Foreclosure. The arbitration
requirement does not limit the right of any party to (i) foreclose against real or personal
property collateral; (ii) exercise self-help remedies relating to collateral or proceeds of
collateral such as setoff or repossession; or (iii) obtain provisional or ancillary remedies such
as replevin, injunctive relief, attachment or the appointment of a receiver, before during or after
the pendency of any arbitration proceeding. This exclusion does not constitute a waiver of the
right or obligation of any party to submit any dispute to arbitration or reference hereunder,
including those arising from the exercise of the actions detailed in sections (i), (ii) and (iii)
of this paragraph.
(d) Arbitrator Qualifications and Powers. Any arbitration proceeding in which the
amount in controversy is $5,000,000.00 or less will be decided by a single arbitrator selected
according to the Rules, and who shall not render an award of greater than $5,000,000.00. Any
dispute in which the amount in controversy exceeds $5,000,000.00 shall be decided by majority vote
of a panel of three arbitrators; provided however, that all three arbitrators must actively
participate in all hearings and deliberations. The arbitrator will be a neutral attorney licensed
in the State of California or a neutral retired judge of the state or federal judiciary of
California, in either case with a minimum of ten years experience in the substantive law applicable
to the subject matter of the dispute to be arbitrated. The arbitrator will determine whether or not
an issue is arbitratable and will give effect to the statutes of limitation in determining any
claim. In any arbitration proceeding the arbitrator will decide (by documents only or with a
hearing at the arbitrator’s discretion) any pre-hearing motions which are similar to motions to
dismiss for failure to state a claim or motions for summary adjudication. The arbitrator shall
resolve all disputes in accordance with the substantive law of California and may grant any remedy
or relief that a court of such state could order or grant within the scope hereof and such
ancillary relief as is necessary to make effective any award. The arbitrator shall also have the
power to award recovery of all costs and fees, to impose sanctions and to take such other action as
the arbitrator deems necessary to the same extent a judge could pursuant to the Federal Rules of
Civil Procedure, the California Rules of Civil Procedure or other applicable law. Judgment upon the
award rendered by the arbitrator may be entered in any court having jurisdiction. The institution
and maintenance of an action for judicial relief or pursuit of a provisional or ancillary remedy
shall not constitute a waiver of the right of any party, including the plaintiff, to submit the
controversy or claim to arbitration if any other party contests such action for judicial relief.
(e) Discovery. In any arbitration proceeding, discovery will be permitted in
accordance with the Rules. All discovery shall be expressly limited to matters directly relevant to
the dispute being arbitrated and must be completed no later than 20 days before the hearing date.
Any requests for an extension of the discovery periods, or any discovery disputes, will be subject
to
final determination by the arbitrator upon a showing that the request for discovery is
essential for the party’s presentation and that no alternative means for obtaining information is
available.
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(f) Class Proceedings and Consolidations. No party hereto shall be entitled to join or
consolidate disputes by or against others in any arbitration, except parties who have executed any
Loan Document, or to include in any arbitration any dispute as a representative or member of a
class, or to act in any arbitration in the interest of the general public or in a private attorney
general capacity.
(g) Payment Of Arbitration Costs And Fees. The arbitrator shall award all costs and
expenses of the arbitration proceeding.
(h) Real
Property Collateral; Judicial Reference. Notwithstanding anything herein to
the contrary, no dispute shall be submitted to arbitration if the dispute concerns indebtedness
secured directly or indirectly, in whole or in part, by any real property unless (i) the holder of
the mortgage, lien or security interest specifically elects in writing to proceed with the
arbitration, or (ii) all parties to the arbitration waive any rights or benefits that might accrue
to them by virtue of the single action rule statute of California, thereby agreeing that all
indebtedness and obligations of the parties, and all mortgages, liens and security interests
securing such indebtedness and obligations, shall remain fully valid and enforceable. If any such
dispute is not submitted to arbitration, the dispute shall be referred to a referee in accordance
with California Code of Civil Procedure Section 638 et seq., and this general reference agreement
is intended to be specifically enforceable in accordance with said Section 638. A referee with the
qualifications required herein for arbitrators shall be selected pursuant to the AAA’s selection
procedures. Judgment upon the decision rendered by a referee shall be entered in the court in which
such proceeding was commenced in accordance with California Code of Civil Procedure Sections 644
and 645.
(i) Miscellaneous. To the maximum extent practicable, the AAA, the arbitrators and the
parties shall take all action required to conclude any arbitration proceeding within 180 days of
the filing of the dispute with the AAA. No arbitrator or other party to an arbitration proceeding
may disclose the existence, content or results thereof, except for disclosures of information by a
party required in the ordinary course of its business or by applicable law or regulation. If more
than one agreement for arbitration by or between the parties potentially applies to a dispute, the
arbitration provision most directly related to the Loan Documents or the subject matter of the
dispute shall control. This arbitration provision shall survive termination, amendment or
expiration of any of the Loan Documents or any relationship between the parties.
(j) Small Claims Court. Notwithstanding anything herein to the contrary, each party
retains the right to pursue in Small Claims Court any dispute within that court’s jurisdiction.
Further, this arbitration provision shall apply only to disputes in which either party seeks to
recover an amount of money (excluding attorneys’ fees and costs) that exceeds the jurisdictional
limit of the Small Claims Court.
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SYNAPTICS INCORPORATED | XXXXX FARGO BANK, NATIONAL ASSOCIATION |
|||||||||
By:
|
/s/ Xxxxxxx X. Xxxxxxx | By: | /s/ Xxxxx Xxxxx | |||||||
Xxxxxxx X. Xxxxxxx, | Xxxxx Xxxxx, | |||||||||
Interim President and CEO | Vice President | |||||||||
By: |
/s/ Xxxxxxxx Xxxxxxx | |||||||||
Xxxxxxxx Xxxxxxx, | ||||||||||
Chief Financial Officer |
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XXXXX FARGO | REVOLVING LINE OF CREDIT NOTE | |
$50,000,000.00 |
San Jose, California | |
August 17, 2011 |
FOR VALUE
RECEIVED, the undersigned SYNAPTICS INCORPORATED (“Borrower”) promises to pay to the
order of XXXXX FARGO BANK, NATIONAL ASSOCIATION (“Bank”) at its office at Santa Xxxxx Technology
RCBO, 000 X. Xxxxxx Xx 0xx Xxxxx, Xxx Xxxx, XX 00000, 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 $50,000,000.00, 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.
1. DEFINITIONS:
As
used herein, the following terms shall have the meanings set forth after each, and any
other term defined in this Note shall have the meaning set forth at the place defined:
1.1 “Business Day” means any day except a Saturday, Sunday or any other day on which
commercial banks in California are authorized or required by law to close.
1.2 “Fixed Rate Term” means a period commencing on a Business Day and continuing for 1, 2 or 3
months, as designated by Borrower, during which all or a portion of the outstanding principal
balance of this Note bears interest determined in relation to LIBOR; provided however, that no Fixed
Rate Term may be selected for a principal amount less than $100,000.00; and provided further, that
no Fixed Rate Term shall extend beyond the scheduled maturity date hereof. If any Fixed Rate Term
would end on a day which is not a Business Day, then such Fixed Rate Term shall be extended to the
next succeeding Business Day.
1.3 “LIBOR” means the rate per annum (rounded upward, if necessary, to the nearest whole 1/8 of
1%) determined by dividing Base LIBOR by a percentage equal to 100% less any LIBOR Reserve
Percentage.
(a) “Base LIBOR” means the rate per annum for United States dollar deposits quoted by
Bank as the Inter-Bank Market Offered Rate, with the understanding that such rate is quoted
by Bank for the purpose of calculating effective rates of interest for loans making reference
thereto, on the first day of a Fixed Rate Term for delivery of funds on said date for a
period of time approximately equal to the number of days in such Fixed Rate Term and in an
amount approximately equal to the principal amount to which such Fixed Rate Term applies.
Borrower understands and agrees that Bank may base its quotation of the Inter-Bank Market
Offered Rate upon such offers or other market indicators of the Inter-Bank Market as Bank in
its discretion deems appropriate including, but not limited to, the rate offered for U.S.
dollar deposits on the London Inter-Bank Market.
(b) “LIBOR Reserve Percentage” means the reserve percentage prescribed by the Board of
Governors of the Federal Reserve System (or any successor) for “Eurocurrency Liabilities” (as
defined in Regulation D of the Federal Reserve Board, as amended), adjusted by Bank for
expected changes in such reserve percentage during the applicable Fixed Rate Term.
1.4 “Prime Rate” means at any time the rate of interest most recently announced within Bank at
its principal office as its Prime Rate, with the understanding that the Prime Rate is one of Bank’s
base rates and serves as the basis upon which effective rates of interest are calculated for those
loans making reference thereto, and is evidenced by the recording thereof after its announcement in
such internal publication or publications as Bank may designate.
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2. INTEREST:
2.1 Interest. The outstanding principal balance of this Note shall bear interest
(computed on the basis of a 360-day year, actual days elapsed) either (a) at a fluctuating rate per
annum equal to the Prime Rate in effect from time to time, or (b) at a fixed rate per annum
determined by Bank to be 2.50000% above LIBOR in effect on the first day of the applicable Fixed
Rate Term. When interest is determined in relation to the Prime Rate, each change in the rate of
interest hereunder shall become effective on the date each Prime Rate change is announced within
Bank. With respect to each LIBOR selection option selected hereunder, Bank is hereby authorized to
note the date, principal amount, interest rate and Fixed Rate Term applicable thereto and any
payments made thereon on Bank’s books and records (either
manually or by electronic entry) and/or
on any schedule attached to this Note, which notations shall be prima facie evidence of the
accuracy of the information noted.
2.2 Selection of Interest Rate Options. At any time any portion of this Note bears
interest determined in relation to LIBOR, it may be continued by Borrower at the end of the Fixed
Rate Term applicable thereto so that all or a portion thereof bears interest determined in relation
to the Prime Rate or to LIBOR for a new Fixed Rate Term designated by Borrower. At any time any
portion of this Note bears interest determined in relation to the Prime Rate, Borrower may convert
all or a portion thereof so that it bears interest determined in relation to LIBOR for a Fixed Rate
Term designated by Borrower. At such time as Borrower requests an advance hereunder or wishes to
select a LIBOR option for all or a portion of the outstanding principal balance hereof, and at the
end of each Fixed Rate Term, Borrower shall give Bank notice specifying: (a) the interest rate
option selected by Borrower; (b) the principal amount subject thereto; and (c) for each LIBOR
selection, the length of the applicable Fixed Rate Term. Any such notice may be given by telephone
(or such other electronic method as Bank may permit) so long as, with respect to each LIBOR
selection, (i) if requested by Bank, Borrower provides to Bank written confirmation thereof not
later than 3 Business Days after such notice is given, and (ii) such notice is given to Bank prior
to 10:00 a.m. on the first day of the Fixed Rate Term, or at a later time during any Business Day
if Bank, at it’s sole option but without obligation to do so, accepts Borrower’s notice and quotes
a fixed rate to Borrower. If Borrower does not immediately accept a fixed rate when quoted by Bank,
the quoted rate shall expire and any subsequent LIBOR request from Borrower shall be subject to a
redetermination by Bank of the applicable fixed rate. If no specific designation of interest is
made at the time any advance is requested hereunder or at the end of any Fixed Rate Term, Borrower
shall be deemed to have made a Prime Rate interest selection for such advance or the principal
amount to which such Fixed Rate Term applied.
2.3 Taxes and Regulatory Costs. Borrower shall pay to Bank immediately upon demand, in
addition to any other amounts due or to become due hereunder, any and all (a) withholdings,
interest equalization taxes, stamp taxes or other taxes (except income and franchise taxes) imposed
by any domestic or foreign governmental authority and related in any manner to LIBOR, and (b)
future, supplemental, emergency or other changes in the LIBOR Reserve Percentage, assessment rates
imposed by the Federal Deposit Insurance Corporation, or similar requirements or costs imposed by
any domestic or foreign governmental authority or resulting from compliance by Bank with any
request or directive (whether or not having the force of law) from any central bank or other
governmental authority and related in any manner to LIBOR to the extent they are not included in the
calculation of LIBOR. In determining which of the foregoing are attributable to any LIBOR option
available to Borrower hereunder, any reasonable allocation made by Bank among its operations shall
be conclusive and binding upon Borrower.
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3.1
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 the Credit Agreement between Borrower and
Bank defined below; 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 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 1, 2012.
3.2 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 (a) Xxxxxxxx Xxxxxxx or
Xxxxxx Xxxxx, 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 (b) any person, with respect to advances deposited to
the credit of any deposit account of Borrower, which advances, when so deposited, shall be
conclusively presumed to have been made to or for the benefit of 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 Borrower.
3.3 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. All payments
credited to principal shall be applied first, to the outstanding principal balance of this Note
which bears interest determined in relation to the Prime Rate, if any, and second, to the
outstanding principal balance of this Note which bears interest
determined in relation to LIBOR,
with such payments applied to the oldest Fixed Rate Term first.
4. PREPAYMENT:
4.1 Prime Rate. Borrower may prepay principal on any portion of this Note which bears
interest determined in relation to the Prime Rate at any time, in any amount and without penalty.
(a) Determine the amount of interest which would have accrued each month on the amount
prepaid at the interest rate applicable to such amount had it remained outstanding until the
last day of the Fixed Rate Term applicable thereto.
(b) Subtract from the amount determined in (a) above the amount of interest
which would have accrued for the same month on the amount prepaid for the remaining term of
such Fixed Rate Term at LIBOR in effect on the date of prepayment for new loans made for such
term and in a principal amount equal to the amount prepaid.
(c) If the result obtained in (b) for any month is greater than zero, discount that
difference by LIBOR used in (b) above.
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Borrower acknowledges that prepayment of such amount may result in Bank incurring additional
costs, expenses and/or liabilities, and that it is difficult to ascertain the full extent of such
costs, expenses and/or liabilities. Borrower, therefore, agrees to pay the above-described
prepayment fee and agrees that said amount represents a reasonable estimate of the prepayment
costs, expenses and/or liabilities of Bank. If Borrower fails to pay any prepayment fee when due,
the amount of such prepayment fee shall thereafter bear interest until paid at a rate per annum
2.000% above the Prime Rate in effect from time to time (computed on the basis of a 360-day year,
actual days elapsed).
This Note is made pursuant to and is subject to the terms and conditions of that certain
Credit Agreement between Borrower and Bank dated as of August 17, 2011, as amended from time to
time (the “Credit Agreement”). Any default in the payment or performance of any obligation under
this Note, or any defined event of default under the Credit Agreement, shall constitute an “Event
of Default” under this Note.
6.1 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 Borrower, and the
obligation, if any, of the holder to extend any further credit hereunder shall immediately cease
and terminate. 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 Borrower or any other person or entity.
6.2 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.
6.3 Governing Law. This Note shall be governed by and construed in accordance with the
laws of the State of California.
SYNAPTICS INCORPORATED | ||||
By: |
/s/ Xxxxxxx X. Xxxxxxx | |||
Xxxxxxx X. Xxxxxxx, Interim President and CEO | ||||
By: |
/s/ Xxxxxxxx Xxxxxxx | |||
Xxxxxxxx Xxxxxxx, Chief Financial Officer |
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