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EXHIBIT 10.17
LOAN AND SECURITY AGREEMENT
THIS LOAN AND SECURITY AGREEMENT (this "Agreement") dated September 30,
1997, is made by the WASHINGTON ECONOMIC DEVELOPMENT FINANCE AUTHORITY, a
public body corporate and politic with perpetual corporate succession,
constituting an instrumentality of the State of Washington, as issuer
("Issuer"), INTRACEL CORPORATION (the "Borrower"), a Delaware corporation
qualified to do business in Washington having its principal place of business
and chief executive office at 0000 Xxxxxxxxx Xxxxxxxxx Xxxx, Xxxxxxxx,
Xxxxxxxxxx 00000, and TRANSAMERICA BUSINESS CREDIT CORPORATION, a Delaware
corporation (the "Lender"), having its principal office at Riverway II, West
Office Tower, 0000 Xxxx Xxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000.
WHEREAS, the Issuer is authorized under the laws of the State, including
Revised Code of Washington Chapter 43.163 (the "Act"), to issue nonrecourse
revenue bonds in the name of the Issuer and loan the proceeds of such bonds to
eligible borrowers to finance "project costs" (as defined in RCW
43.163.010(12)), which includes, among other things, the acquisition of
equipment; and
WHEREAS, the definition of "bonds" under RCW 43.163.010(2) also includes
notes, lines of credit and other financial arrangements, and, in relation
thereto, the Issuer is authorized to enter into "financing documents" (as
defined in RCW 43.163.010(9)) necessary or convenient for purposes of financing
project costs; and
WHEREAS, in accordance with the Act, Issuer proposes to issue its Economic
Development Revenue Bond, Series 1997-E (Intracel Corporation Project) (the
"Bond") to Lender, the borrowings under which shall be loaned by the Issuer to
Borrower in two installments and used by Borrower to finance all or a portion
of the Project (as hereinafter defined) pursuant to this Agreement; and
WHEREAS, Borrower proposes to borrow the proceeds of the Loan (as
hereinafter defined) upon the terms and conditions set forth herein to finance
all or a portion of the Project, which shall be located entirely within
Issaquah, Washington; and
WHEREAS, Borrower shall make Loan Payments (as hereinafter defined)
directly to the Debt Service Fund established in the name of Lender, as
assignee of Issuer and as holder of the Bond; and
WHEREAS, this Agreement shall not be deemed to constitute a debt or
liability or moral obligation of the Issuer or the State or any political
subdivision thereof, or a pledge of the faith and credit of the Issuer or the
State or any political subdivision thereof, but shall be a special obligation
payable solely from the Loan Payments payable hereunder by Borrower to Lender,
as assignee of Issuer;
NOW, THEREFORE, for good and valuable consideration, receipt of which is
hereby acknowledged, and in consideration of the premises contained in this
Agreement, Lender, Issuer and Borrower agree as follows:
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1. DEFINITIONS. As used herein, the following terms shall have the
following meanings, and shall be equally applicable to both the singular and
plural forms of the terms defined:
SECTION 1.1. DEFINED TERMS.
Bond means the Washington Economic Development Finance Authority
Economic Development Revenue Bond, Series 1997-E (Intracel Corporation Project),
in the form attached hereto as Exhibit X.
Xxxx Counsel means any nationally recognized counsel experienced in
matters for municipal law acceptable to Issuer and Lender.
Business Day shall mean any day other than a Saturday, Sunday or
public holiday or the equivalent for banks in New York City.
Code means the Internal Revenue Code of 1986, as amended, and United
States Treasury Regulations promulgated thereunder.
Collateral means the collateral pledged by Borrower to Lender to
secure the Loan, as described in Section 2 and Exhibit D hereof.
Debt Service Fund means Account No. 55-75427 ABA Routing Number
000-000-000, at The First National Bank of Chicago, into which Borrower will
make payments as required by this Agreement. The Debt Service Fund shall
constitute a special fund pursuant to RCW 43.163.130(3). Amounts deposited by
Borrower into the Debt Service Fund shall be applied towards Obligations
due hereunder.
Determination of Taxability means any determination, decision or
decree by the Commissioner of Internal Revenue, or any District Director of
Internal Revenue or any court of competent jurisdiction, or an opinion obtained
by Lender of counsel qualified in such matters, that an Event of Taxability
shall have occurred. A Determination of Taxability also shall be deemed to have
occurred on the first to occur of the following:
(a) the date when Borrower files any statement, supplemental
statement, or other tax schedule, return or document, which discloses that an
Event of Taxability shall have occurred; or
(b) the effective date of any federal legislation enacted after the
date of this Agreement or promulgation of any income tax regulation or ruling
by the Internal Revenue Service that causes an Event of Taxability after the
date of this Agreement.
Event of Default shall mean any event specified in Section 6 of this
Loan.
Event of Taxability means: (i) any act, failure to act or use of the
proceeds of the Loan, (ii) any change in the use of the Project, (iii) any
misrepresentation or inaccuracy in any of the representations, warranties or
covenants contained in this Agreement or the Tax Regulatory Agreement by Issuer
or Borrower, or (iv) the enactment of any federal legislation after the date of
this Agreement
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or the promulgation of any income tax regulation or ruling by the Internal
Revenue Service after the date of this Agreement, any one or more of which
causes the interest on the Bond to become includable in Lender's gross income
for federal income tax purposes.
GAAP shall mean generally accepted accounting principles in the
United States of America, as in effect from time to time.
Gross-Up Rate means, with respect to any Interest payment (including
payments made prior to the Event of Taxability), the rate necessary to
calculate an additional payment in an amount sufficient such that the sum of
the Interest payment plus the additional payments would, after reduced by the
federal tax (including interest and penalties) actually imposed thereon, equal
the amount of the Interest payment.
Interest means the portion of any payment from Borrower designated as
and comprising interest on the Loan and on the Bond.
Issuer means the Washington Economic Development Finance Authority, a
public body corporate and politic with perpetual corporate succession,
constituting an instrumentality of the State, acting as issuer under this
Agreement.
Loan means the loan from Issuer to Borrower pursuant to this
Agreement.
Loan Documents shall mean, collectively, this Agreement, the Bond, and
each other document, agreement, certificate and instrument executed by the
Borrower and delivered to the Lender in connection herewith and therewith, as
the same may be modified, extended, restated or supplemented from time to time.
Loan Payments means the loan payments payable by Borrower pursuant to
the provisions of this Agreement as specifically set forth in Exhibit B hereto.
As provided in Section 3 hereof, Loan Payments shall be payable by Borrower
directly to Lender, as assignee of Issuer and holder of the Bond, in the amounts
of Principal and Interest due on the Loan.
Material Adverse Change shall mean, with respect to any Person, a
material adverse change in the business, operations, results of operations,
assets, liabilities or condition (financial or otherwise) of such Person and
its subsidiaries, taken as a whole.
Material Adverse Effect shall mean, with respect to any Person, a
material adverse effect on the business, operations, results of operations,
assets, liabilities or condition (financial or otherwise) of such Person and
its subsidiaries, taken as a whole.
Obligations shall mean all indebtedness, obligations and liabilities
of the Borrower under this Agreement, whether on account of Principal,
Interest, indemnities, fees (including, without limitation, attorneys' fees,
remarketing fees, origination fees, collection fees and all other
professionals' fees), costs, expenses, taxes or otherwise.
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Opinion of Bond Counsel means a written opinion of Bond Counsel
addressed to Issuer and Lender that the action proposed to be taken will not
adversely affect the validity of the Bond or the exclusion from gross income
for federal income tax purposes of Interest of the Bond.
Person shall mean any individual, sole proprietorship, partnership,
joint venture, trust, unincorporated organization, association, corporation,
institution, entity, party or government (including any division, agency or
department thereof), and the successors, heirs and assigns of each.
Principal means the portion of any payment from Borrower designated as
and comprising part or all of the principal of the Loan and the Bond.
Project means the acquisition and installation of equipment to be used
in connection with Borrower's operation, which project is described in Exhibit
A hereto.
Project Costs means the costs of completing the Project, including
costs of issuance of the Bond, which Project Costs are set forth in Exhibit A
hereto.
Resolution means, collectively, Resolution No. W-96-013, dated December
10, 1996, and Resolution No. W-97-021, dated September 10, 1997, adopted by the
Issuer and pursuant to which the Bond will be issued and this Agreement will be
authorized.
Retained Rights means the Issuer's rights to receipt of fees,
reimbursement of costs, and indemnification as set forth in this Agreement.
State means the State of Washington.
Tax Regulatory Agreement means the Tax Regulatory Agreement of even
date herewith among Borrower, Issuer and Lender, as such Tax Regulatory
Agreement may be amended from time to time in accordance with its terms.
UCC means the Uniform Commercial Code as adopted and in effect in the
State.
SECTION 1.2 EXHIBITS. The following exhibits are attached hereto and
made a part hereof:
Exhibit A: Form of Schedule of Project Loan Payments describing the
Project and setting forth the Loan Payments and
Prepayment Prices.
Exhibit B: Form of Bond.
Exhibit C: Forms of Requisition.
Exhibit D: Description of Collateral Pledged to Secure Loan.
Exhibit E: Form of opinion of counsel to Borrower.
Exhibit F: Form of opinion of Bond Counsel.
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2. CREATION OF SECURITY INTEREST; COLLATERAL. The Borrower hereby
assigns and grants to the Lender a lien on and security interest in, all the
Borrower's right, title and interest in and to all the following collateral (the
"Collateral"), to secure the payment and performance of all the Obligations. The
Collateral consists of all equipment set forth on Exhibit D hereto (the
"Equipment"), together with all present and future additions, parts,
accessories, attachments, substitutions, repairs, improvements and repairs,
improvements and replacements thereof or thereto, and any and all proceeds
thereof, including, without limitation, proceeds of insurance. Borrower intends
that the security interest granted herein shall have first priority over all
others.
3. FINANCING OF PROJECT AND TERMS OF LOAN.
3.1 BORROWING; ISSUANCE OF BOND; AGREEMENT TO CONSTITUTE
CONTRACT. To provide funds to pay for Project Costs, Issuer hereby agrees to
borrow an amount of up to $1,500,000 from Lender and loan the proceeds of that
borrowing to Borrower. Such borrowing shall only be pursuant to requisitions
submitted by Borrower to Issuer in the form attached hereto as Exhibit C2. As
evidence of this indebtedness, Issuer will issue its Washington Economic
Development Finance Authority Economic Development Revenue Bond, Series 1997-E
(Intracel Corporation Project). This Agreement shall constitute a contract
between Issuer, Borrower and Lender, as holder of the Bond. The parties
covenant that they will abide by the terms of this Agreement and the Bond.
3.2 DESCRIPTION OF THE BOND. The Bond shall be issued as a
single bond in registered form as set forth in Exhibit B attached hereto. The
Bond shall mature, and Principal of, premium (if any) and Interest on the Bond
shall be payable as set forth herein. A single Bond will be issued to avoid the
execution of individual bonds or promissory notes for each advance by the Lender
to the Issuer for the benefit of the Borrower. The Bond and all obligations of
Issuer under or with respect to the Bond and this Agreement are limited
obligations of Issuer payable solely out of the Loan Payments made by Borrower
for deposit to the Debt Service Fund and other Collateral specifically pledged
hereunder. No recourse shall be had against any other properties, funds or
assets of Issuer for the payment of any amounts owing with respect to the Bond
or this Agreement. The Bond, this Agreement and the obligations of Issuer under
or with respect thereto do not constitute or create a charge against Issuer or
create an indebtedness of Issuer within the meaning of any constitutional debt
limitation. Holders of the Bond shall have no right to compel the payment of any
amounts owing under or with respect to the Bond or this Agreement out of any
funds or other assets of Issuer or the State. Issuer's agents, including the
person(s) executing this Agreement or the Bond, shall not be subject to any
personal liability for any reason relating to the issuance of the Bond or the
performance of any obligations under or with respect to this Agreement.
IN ACCORDANCE WITH RCW 43.163.140(1), THE BOND IS NOT A GENERAL, SPECIAL OR
MORAL OBLIGATION OF THE STATE OR ANY POLITICAL SUBDIVISION THEREOF, NOR A
PLEDGE OF THE FAITH AND CREDIT OF THE STATE OR ANY POLITICAL SUBDIVISION
THEREOF. THE BOND IS A SPECIAL NONRECOURSE REVENUE OBLIGATION OF THE ISSUER,
SECURED BY AND PAYABLE SOLELY FROM THE SPECIAL FUND OR FUNDS CREATED BY THE
ISSUER FOR THEIR REPAYMENT. THE ISSUER HAS NO TAXING POWER.
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3.3 ACQUISITION OF PROJECT. Borrower shall acquire the Project and
shall bear the risk with respect to any loss or claim relating to any portion of
the Project and shall be liable in respect of its duties and obligations in
accordance with any contract entered into in connection with the Project, and
neither Lender nor Issuer shall assume any such liability or risk of loss.
3.4 LOAN. Issuer hereby agrees, subject to the terms and conditions
of this Agreement and the Resolution, to borrow from Lender and loan to Borrower
an amount of $1,500,000 for the purpose of financing Project Costs. Issuer's
obligation to Lender shall be evidenced by the Bond described in Section 3.2
above. The borrowing and the Loan will be in two installments, the first of
which will be in an aggregate principal amount of $713,339.49 and will take
place on the date of execution and delivery of this Agreement. The second
installment will be for the balance and will take place on or about November 25,
1997 (but not later than December 1, 1997); provided, however, that the second
installment shall not be funded unless and until Issuer has received a written
statement from Bond Counsel that the average life of the Bond will not be
greater than 120% of the reasonably expected useful life of (1) the assets to be
financed with such installment, and (2) the assets financed with proceeds
derived from the first installment. Borrower hereby agrees, subject to the terms
and conditions of this Agreement, to borrow such amount from Issuer and to pay
all Obligations hereunder. Lender will advance funds necessary to make Loan
installments directly to Borrower pursuant to requisitions submitted by Issuer
and Borrower, which requisitions shall be in the forms of Exhibits C1 and C2
attached hereto. Issuer's obligation to issue the Bond, Lender's obligation to
provide financing for the Loan, and Borrower's obligation to repay the Loan,
shall commence on the date hereof.
3.5 INTEREST. The principal amount of the Bond and the Loan
hereunder outstanding from time to time shall bear interest (computed on the
basis of actual days elapsed in a 360-day year) as follows. Interest on the
first Loan installment and that portion of the Bond relating thereto shall
accrue from September 30, 1997 at a rate of 10.946%. Interest on the second Loan
installment and that portion of the Bond relating thereto shall accrue from the
date that funds are advanced by Lender to Issuer and loaned by Issuer to
Borrower at an interest rate to be established by Lender of not less than ten
percent (10%) and not greater than twelve percent (12%). Notwithstanding the
foregoing, upon any Determination of Taxability, Interest shall accrue at the
Gross-Up Rate.
3.6 PAYMENTS. Loan Payments and other payments shall be made by
Borrower directly to Lender, as Issuer's assignee and holder of the Bond.
Borrower shall pay Loan Payments in the amounts and on the dates set forth in
Exhibit A hereto.
As security for its obligation to pay the principal of, premium, if any, and
interest on the Bond, Issuer assigns to Lender all of Issuer's right to receive
Loan Payments from Borrower hereunder, all of Issuer's rights hereunder (except
for Retained Rights). Lender agrees to accept Loan Payments and other payments
made by Borrower hereunder (and proceeds, if any, of the Collateral) in
satisfaction of Issuer's corresponding obligations on the Bond. No provision,
covenant or agreement contained in this Agreement or any obligation herein
imposed on Issuer, or the breach thereof, shall constitute or give rise to or
impose upon Issuer a pecuniary liability, a charge upon its general credit or a
pledge of its general revenues. Issuer has no taxing power. In making the
agreements, provisions and covenants set forth in this Agreement, Issuer has not
obligated itself except with respect to its representations and warranties
herein and the application by Issuer of the Loan Payments to be paid by
Borrower. All amounts required to be paid by Borrower hereunder shall be paid in
lawful money of the United States of America by
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corporate check or wire transfer to the Debt Service Fund. No recourse shall be
had by Lender or Borrower for any claim based on this Agreement or the Tax
Regulatory Agreement against Issuer or any director, officer, employee or agent
of Issuer alleging personal liability, on the part of such person, unless such
claim is based on the willful dishonesty of or intentional violation of law by
such person.
3.7 PAYMENT ON NON-BUSINESS DAYS. Whenever any payment to be made
hereunder shall be stated to be due on a day which is not a Business Day, such
payment may be made on the next succeeding Business Day, and such extension of
time shall in such case be included in the computation of interest or the fees
hereunder, as the case may be.
3.8 LOAN PAYMENTS TO BE UNCONDITIONAL. The obligations of Borrower
to make the Loan Payments required hereunder and to make other payments
hereunder and to perform and observe the covenants and agreements contained
herein shall be absolute and unconditional in all events, without abatement,
diminution, deduction, setoff or defense for any reason, including (without
limitation) any failure of the Project to be completed, any defects,
malfunctions, breakdowns or infirmities in the Project or any accident,
condemnation, destruction or unforeseen circumstances. Notwithstanding any
dispute between Borrower and any of Issuer, Lender, or any other person,
Borrower shall make all Loan Payments when due and shall not withhold any Loan
Payments pending final resolution of such dispute, nor shall Borrower assert any
right of set-off or counterclaim against its obligation to make such payments
required under this Agreement.
3.9 PREPAYMENT. Borrower shall have the right to prepay the Loan
and direct Issuer to optionally redeem the Bond in full. The prepayment amount
shall be paid by Borrower to Lender in an amount equal to the present value of
all remaining unpaid Loan Payments discounted at a rate of six percent (6%) per
annum.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE ISSUER. Issuer
represents, warrants and covenants for the benefit of Lender and Borrower, as
follows:
(a) Issuer is a public body corporate and politic with perpetual
corporate succession, constituting an instrumentality of the State.
(b) Issuer is authorized under the laws of the State to enter into
this Agreement, the Tax Regulatory Agreement and the transactions contemplated
hereby, to issue the Bond and to perform all of its obligations hereunder.
(c) Issuer has duly authorized the execution and delivery of this
Agreement, the Bond and the Tax Regulatory Agreement under the terms and
provisions of the resolution of its governing body or by other appropriate
official approval, and further represents, covenants and warrants that all
requirements have been met and procedures have occurred in order to ensure the
enforceability of this Agreement, the Bond and the Tax Regulatory Agreement
against Issuer.
(d) The officer of Issuer executing this Agreement and any related
documents has been duly authorized to execute and deliver this Agreement, the
Bond and the Tax Regulatory Agreement and such related documents under the terms
and provisions of a resolution of Issuer's governing body, or by other
appropriate official action.
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(e) This Agreement, the Bond and the Tax Regulatory Agreement are
legal, valid and binding obligations of Issuer, enforceable in accordance with
their respective terms, except to the extent limited by bankruptcy,
reorganization or other laws of general application relating to effecting the
enforcement of creditors' rights.
(f) Issuer has assigned to Lender all of Issuer's rights in the
Project and this Agreement (except for Retained Rights) including the assignment
of all rights in the security interest granted to Issuer by Borrower.
(g) Issuer will not pledge, mortgage or assign this Agreement or its
duties and obligations hereunder to any person, firm or corporation, except as
provided under the terms hereof.
(h) Issuer will submit or cause to be submitted to the Secretary of
the Treasury a Form 8038 (or other information reporting statement) at the time
and in the form required by the Code.
(i) The financing of the Project has been approved by the
"applicable elected representative" (as defined in Section 147(f) of the Code)
of Issuer after a public hearing held upon reasonable notice.
5. THE BORROWER'S REPRESENTATIONS AND WARRANTIES.
5.1 GOOD STANDING; QUALIFIED TO DO BUSINESS. The Borrower (a) is
duly organized, validly existing and in good standing under the laws of the
State of Delaware, (b) has the requisite power and authority to own its
properties and assets and to transact the businesses in which it is presently,
or proposes to be, engaged and (c) is duly qualified and authorized to do
business in the State and is in good standing in every jurisdiction in which the
failure to be so qualified could have a Material Adverse Effect on (i) the
Borrower, (ii) the Borrower's ability to perform its obligations under the Loan
Documents or (iii) the rights of the Lender hereunder.
5.2 DUE EXECUTION, ETC. The execution, delivery and performance by
the Borrower of each of the Loan Documents to which it is a party are within the
powers of the Borrower, do not contravene the original documents, if any, of the
Borrower, and do not (a) violate any law or regulation, or any order or decree
of any applicable court or governmental authority, (b) conflict with or
result in a breach of, or constitute a default under, any material indenture,
mortgage or deed of trust or any material lease, agreement or other instrument
binding on the Borrower or any of its properties, or (c) require the consent,
authorization by or approval of or notice to or filing or registration with any
governmental authority or other Person, other than those that have been obtained
or made. This Agreement is, and each of the other Loan Documents to which the
Borrower is or will be a party, when delivered hereunder or thereunder, will be,
the legal, valid and binding obligation of the Borrower enforceable against the
Borrower in accordance with its terms, except as enforceability may be limited
by bankruptcy, insolvency or similar laws affecting creditors' right, generally
and by general principles of equity.
5.3 SOLVENCY; NO LIENS. The Borrower is solvent, is paying its debts
as they become due and has sufficient capital to conduct its business; the fair
saleable value of the Borrower's assets is in excess of the total amount of its
liabilities (including contingent liabilities) as they become absolute and
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matured; the security interests granted herein constitute and shall at all times
constitute the first and only liens on the Collateral (subject to subordinated
liens therein in accordance with any subordination agreement approved by
Lender); and the Borrower is, or will be at the time additional Collateral is
acquired by it, the absolute owner of the Collateral with full right to pledge,
sell, consign, transfer and create a security interest therein, free and clear
of any and all claims or liens in favor of any other Person.
5.4 NO JUDGMENTS, LITIGATION. No judgments are outstanding against
the Borrower nor is there now pending or, to the best of the Borrower's
knowledge after diligent inquiry, threatened any litigation, contested claim, or
governmental proceeding by or against the Borrower except judgments and pending
or threatened litigation, contested claims and governmental proceedings which
would not, in the aggregate, have a Material Adverse Effect on the Borrower.
5.5 NO DEFAULTS. The Borrower is not in default under any material
contract, lease, or commitment to which it is a party or by which it is bound or
the Borrower has received duly executed waivers for any of such defaults in form
and substance satisfactory to the Issuer and Lender. The Borrower knows of no
dispute regarding any contract, lease, or commitment to which the Borrower is a
party which could have a Material Adverse Effect on the Borrower.
5.6 COLLATERAL LOCATIONS. On the date hereof, the Collateral is
located at the place or places of business specified in Exhibit D hereto.
5.7 NO EVENTS OF DEFAULT. No Event of Default has occurred and is
continuing nor has any event occurred which, with the giving of notice or the
passage of time, or both, would constitute an Event of Default.
5.8 NO LIMITATION ON LENDER'S RIGHTS. Except as permitted herein,
none of the Collateral is subject to contractual obligations that may restrict
or inhibit the Lender's rights or abilities to sell or dispose of the Collateral
or any part thereof after the occurrence of an Event of Default.
5.9 PERFECTION AND PRIORITY OF SECURITY INTEREST. This Agreement
creates a valid and, upon completion of all required filings of financing
statements, a perfected and first priority and security interest in the
Collateral, securing the payment of all the Obligations.
5.10 MODEL AND SERIAL NUMBERS. Exhibit D hereto sets forth the true
and correct model number and serial number of each item of equipment that
constitutes Collateral.
6. COVENANTS OF THE BORROWER.
6.1 EXISTENCE, ETC. The Borrower will maintain its existence and its
current yearly accounting cycle; shall maintain in full force and effect all
licenses, bonds, franchises, leases, trademarks, patents, contracts and other
rights where the failure to so maintain would have a Material Adverse Effect;
shall continue in, and limit its operations to, the same general lines of
business as those presently conducted by it; and shall comply with all
applicable laws and regulations of any federal, state or local governmental
authority, except for such laws and regulations the violations of which would
not, in the aggregate, have a Material Adverse Effect on the Borrower.
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6.2 NOTICE TO THE LENDER. As soon as possible, and in any event within
five days after the Borrower learns of the following, the Borrower will give
written notice to the Lender of (a) any proceeding instituted or threatened to
be instituted by or against the Borrower in any federal, state, local or foreign
court or before any commission or other regulatory body (federal, state, local
or foreign), (b) the occurrence of any Material Adverse Change with respect to
the Borrower and (c) the occurrence of any Event of Default or event or
condition which, with notice or lapse of time or both, would constitute an Event
of Default, together with a statement of the action which the Borrower has taken
or proposes to take with respect thereto.
6.3 MAINTENANCE OF BOOKS AND RECORDS. The Borrower will maintain books and
records pertaining to the Collateral in such detail, form and scope as the
Lender shall require in its commercially reasonable judgment. The Borrower
agrees that the Lender or its agents (at Lender's cost and expense so long as no
Event of Default shall have occurred and be continuing) may enter upon the
Borrower's premises at any time and from time to time during normal business
hours, and at any time on and after the occurrence of an Event of Default, for
the purpose of inspecting the Collateral and any and all records pertaining
thereto.
6.4 INSURANCE. The Borrower will maintain insurance on the Collateral
under such policies of insurance, with such insurance companies, in such amounts
and covering such risks as are at all times reasonably satisfactory to the
Lender. All such policies shall be made payable to the Lender, in case of loss,
under a standard non-contributory "lender" or "secured party" clause and are to
contain such other provisions as the Lender may reasonably require to protect
the Lender's interests in the Collateral and to any payments to be made under
such policies. True copies of all original insurance policies are to be
delivered to the Lender, premium prepaid, with the loss payable endorsement in
the Lender's favor, and shall provide for not less than thirty days' prior
written notice to the Lender, of any material alteration, as determined in the
sole discretion of the Lender, or cancellation of coverage. If the Borrower
fails to maintain such insurance, the Lender may arrange for (at the Borrower's
expense and without any responsibility on the Lender's part for) obtaining the
insurance. Unless the Lender shall otherwise agree with the Borrower in writing,
the Lender shall have the sole right, in the name of the Lender or the Borrower,
to file claims under any insurance policies, to receive and give acquittance for
any payments that may be payable thereunder, and to execute any endorsements,
receipts, releases, assignments, reassignments or other documents that may be
necessary to effect the collection, compromise or settlement of any claims under
any such insurance policies.
6.5 TAXES. The Borrower will pay, when due, all taxes, assessments, claims
and other charges (herein "taxes") lawfully levied or assessed against the
Borrower or the Collateral other than taxes that are being diligently contested
in good faith by the Borrower by appropriate proceedings promptly instituted and
for which an adequate reserve is being maintained by the Borrower in accordance
with GAAP. If any taxes remain unpaid after the date fixed for the payment
thereof, or if any lien shall be claimed therefor, and such taxes are not being
diligently contested in good faith by the Borrower, then, upon notice to the
Borrower, but on the Borrower's behalf, the Lender may pay such taxes, and the
amount thereof shall be included in the Obligations.
6.6 BORROWER TO DEFEND COLLATERAL AGAINST CLAIMS; FEES ON COLLATERAL. The
Borrower will defend the Collateral against all claims and demands of all
Persons at any time claiming the same or any interest therein. Borrower will not
permit any notice creating or otherwise relating to
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liens on the Collateral or any portion thereof to exist or be on file in any
public office. The Borrower shall promptly pay, when due, all transportation,
storage and warehousing charges and license fees, registration fees,
assessments, charges, permit fees and taxes (municipal, state and federal)
which may now or hereafter be imposed upon the ownership, leasing, renting,
possession, sale or use of the Collateral, excluding, however, all taxes on or
measured by the Lender's income.
6.7 NO CHANGE OF LOCATION, STRUCTURE OR IDENTITY. The Borrower will
not (a) change the location of its chief executive office or establish any
place of business other than those specified herein or (b) move or permit the
movement of any Collateral from the location specified in Exhibit D hereto,
except that the Borrower may change its chief executive office, establish any
other place of business, and keep Collateral at other locations within the
United States provided that the Borrower has delivered to the Lender (i) prior
written notice thereof and (ii) duly executed financing statements and other
agreements and instruments (all in form and substance satisfactory to the
Lender) necessary to perfect and maintain in favor of the Lender a first
priority security interest in the Collateral. Notwithstanding anything to the
contrary in the immediately preceding sentence, the Borrower may keep any
Collateral consisting of motor vehicles or rolling stock at any location in the
United States provided that the Lender's security interest in any such
Collateral is conspicuously marked on the certificate of title thereof and the
Borrower has complied with the provisions of Section 4.9.
6.8 USE OF COLLATERAL; LICENSES. The Collateral shall be operated
by competent, qualified personnel in connection with the Borrower's business
purposes, for the purpose for which the Collateral was designed and in
accordance with applicable operating instructions, laws and government
regulations, and the Borrower shall use every reasonable precaution to prevent
loss or damage to the Collateral from fire and other hazards. The Collateral
shall not be used or operated for personal, family or household purposes. The
Borrower shall procure and maintain in effect all orders, licenses,
certificates, permits, approvals and consents required by federal, state or
local laws or by any governmental body, agency or authority in connection with
the delivery, installation, use and operation of the Collateral.
6.9 FURTHER ASSURANCES. The Borrower will, promptly upon request by
the Lender, execute and deliver any document required by the Lender (including,
without limitation, warehouseman or processor disclaimers, mortgagee waivers,
landlord disclaimers, or subordination agreements with respect to the
Obligations and the Collateral), give any notices, execute and file any
financing statements, mortgages or other documents (all in form and substance
reasonably satisfactory to the Lender), xxxx any chattel paper, deliver any
chattel paper or instruments to the Lender, and take any other actions that are
necessary or, in the commercially reasonable judgment of the Lender, desirable
to perfect or continue the perfection and priority of the Lender's security
interest in the Collateral, to protect the Collateral against the rights,
claims, or interests of any Persons, or to effect the purposes of this
Agreement. The Borrower hereby authorizes the Lender to file one or more
financing or continuation statements, and amendments thereto, relating to all or
any part of the Collateral without the signature of the Borrower where permitted
by law. A carbon, photographic or other reproduction of this Agreement or any
financing statement covering the Collateral or any part thereof shall be
sufficient as a financing statement where permitted by law. To the extent
required under this Agreement, the Borrower will pay all reasonable costs and
expenses (including attorneys' fees) incurred in connection with any of the
foregoing.
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11-LOAN AND SECURITY AGREEMENT
12
6.10 NO DISPOSITION OF COLLATERAL. The Borrower will not in any way
hypothecate or create or permit to exist any lien, security interest, charge or
encumbrance on or other interest in any of the Collateral, except for the lien
and security interest granted hereby, and the Borrower will not sell, transfer,
assign, pledge, collaterally assign, exchange or otherwise dispose of any of
the Collateral without written notice to and consent of the Lender and an
Opinion of Bond Counsel. In the event the Collateral, or any part thereof, is
sold, transferred, assigned, exchanged, or otherwise disposed of in violation
of these provisions, the security interest of the Lender shall continue in such
Collateral or part thereof notwithstanding such sale, transfer, assignment,
exchange or other disposition, and the Borrower will hold the proceeds thereof
in a separate account for the benefit of the Lender. Following such a sale, the
Borrower will transfer such proceeds to the Lender in kind.
6.11 NO LIMITATION ON LENDER'S RIGHTS. The Borrower will not enter
into any contractual obligations which may restrict or inhibit the Lender's
rights or ability to sell or otherwise dispose of the Collateral or any part
thereof.
6.12 PROTECTION OF COLLATERAL. The Lender shall have the right at any
time to make any payments and do any other acts the Lender may deem necessary to
protect its security interests in the Collateral, including, without limitation,
the rights to satisfy, purchase, contest or compromise any encumbrance, charge
or lien which, in the reasonable judgment of the Lender, appears to be prior to
or superior to the security interests granted hereunder, and appear in and
defend any action or proceeding purporting to affect its security interests in,
or the value of, any, of the Collateral. The Borrower hereby agrees to reimburse
the Lender for all reasonable payments made and reasonable expenses incurred in
connection with the enforcement of this Agreement including fees, expenses and
disbursements of attorneys and paralegals (including the allocated costs of
in-house counsel) acting for the Lender, including any of the foregoing payments
under, or acts taken to protect its security interests in, any of the
Collateral, which amounts shall be secured under this Agreement, and agrees it
shall be bound by any payment made or act taken by the Lender hereunder absent
the Lender's gross negligence or reckless or willful misconduct. The Lender
shall have no obligation to make any of the foregoing payments or perform any of
the foregoing acts.
6.13 DELIVERY OF ITEMS. The Borrower will promptly (but in no event
later than one Business Day) after its receipt thereof, deliver to the Lender
any documents or certificates of title issued with respect to any property
included in the Collateral, and any promissory notes, letters of credit or
instruments related to or otherwise in connection with any property included in
the Collateral, which in any such case come into the possession of the
Borrower, or shall cause the issuer thereof to deliver any of the same directly
to the Lender, in each case with any necessary endorsements in favor of the
Lender.
6.14 FUNDAMENTAL CHANGES. Without the prior written consent of the
Lender (which consent shall not be unreasonably withheld) and an Opinion of
Bond Counsel, the Borrower shall not merge or consolidate into any other
Person, or amend or modify its name, status or existence, or sell or otherwise
dispose of all or substantially all of its assets.
6.15 SALE OF ASSETS. Borrower will not sell, lease, assign, transfer
or otherwise dispose of any of the Collateral or any interest therein (whether
in one transaction or in a series of transactions) unless Borrower replaces
such Collateral with substitute property satisfactory to Lender in Lender's
sole discretion and such substitute property is substituted in this Agreement
and the related documents by
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12-LOAN AND SECURITY AGREEMENT
13
appropriate amendment prior to the date of such proposed sale. Borrower will
not sell, lease, assign, transfer or otherwise dispose of Project components
without an Opinion of Bond Counsel.
6.16 PLACE OF BUSINESS. Borrower will not permit any of the
Project to be moved outside the limits of Issaquah, Washington. Borrower will
not permit any of the Collateral or any records pertaining to the Collateral to
be moved outside the locations of such items on the date of issuance of the
Bond.
6.17 PROJECT A "MANUFACTURING FACILITY." Borrower owns or
will own the Project and intends to operate the Project, or cause the Project to
be operated, in conformance with the Act and as a "manufacturing facility,"
within the meaning of Section 144(a)(12)(C) of the Code, until the date on which
all of the Loan Payments have been fully paid.
6.18 TAX EXEMPT BORROWINGS. The aggregate authorized face
amount of the Bond allocated to any test-period beneficiary, when increased by
the outstanding tax-exempt facility-related bonds of such test-period
beneficiary, does not exceed $40,000,000, all within the meaning of Section
144(a)(10) of the Code. The aggregate amount of capital expenditures with
respect to any facilities located within Issaquah, Washington whose principal
user is the Borrower or an entity or person related to the Borrower to be paid
or incurred during the six-year period beginning September 30, 1994 and ending
September 30, 2000 shall not exceed $10,000,000, all within the meaning of
Section 144(a)(4) of the Code.
6.19 PRESERVATION OF TAX EXEMPT STATUS. Borrower will not
take any action that would cause the Interest on the Bond to become includable
in gross income of the holder thereof for federal income tax purposes under the
Code, and Borrower will take and will cause its officers, employees and agents
to take all affirmative actions legally within its power necessary to ensure
that such Interest does not become includable in gross income of the holder
thereof for federal income tax purposes under the Code (including, without
limitation, the calculation and payment of any rebate required to preserve such
exclusion).
6.20 ASSIST ISSUER. Borrower will aid and assist Issuer in
connection with preparing and submitting to the Secretary of the Treasury a Form
8038 (or other applicable information reporting statement) at the time and in
the form required by the Code.
6.21 TAX REGULATORY AGREEMENT. Borrower will comply fully at
all times with the Tax Regulatory Agreement, and Borrower will not take any
action, or omit to take any action, which, if taken or omitted, respectively,
would violate the Tax Regulatory Agreement.
7. FINANCIAL STATEMENTS. Until the payment and satisfaction in
full of all Obligations, the Borrower shall deliver to the Lender the following
financial information:
7.1 ANNUAL FINANCIAL STATEMENTS. As soon as available, but
not later than 120 days after the end of each fiscal year of the Borrower and
its consolidated subsidiaries, the consolidated balance sheet, income statement
and statements of cash flows and shareholders equity for the Borrower and its
consolidated subsidiaries (the "Financial Statements") for such year, reported
on by independent certified public accountants without an adverse
qualification; and
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13-LOAN AND SECURITY AGREEMENT
14
7.2 QUARTERLY FINANCIAL STATEMENTS. As soon as available,
but not later than 60 days after the end of each of the first three fiscal
quarters in any fiscal year of the Borrower and its consolidated subsidiaries,
the Financial Statements for such fiscal quarter, together with a certification
duly executed by a responsible officer of the Borrower that such Financial
Statements have been prepared in accordance with GAAP and are fairly stated in
all material respects (subject to normal year-end audit adjustments and lack of
footnote disclosure).
8. EVENTS OF DEFAULT. The occurrence of any of the following
events shall constitute an Event of Default hereunder:
(a) the Borrower shall fail to make any payment with
respect to Obligations as required hereunder when payable or within three
Business Days of when payable, whether at stated maturity, by acceleration or
otherwise;
(b) any representation or warranty made or deemed made by
the Borrower under or in connection with any Loan Document shall prove to have
been false or incorrect in any material respect when made;
(c) the Borrower shall fail to perform or observe any term,
covenant or agreement contained in any Loan Document (other than as set forth
in Section 8(a)) to be performed or observed on its part, and such failure
remains unremedied for the later of thirty days from (i) the date on which the
Lender has given the Borrower written notice of such failure and (ii) the date
on which the Borrower knew or should have known of such failure;
(d) any material provision of any Loan Document to which
the Borrower is a party shall for any reason cease to be valid and binding on
the Borrower, or the Borrower shall so state in writing;
(e) dissolution, liquidation, winding up or cessation of
the Borrower's business, or the failure of the Borrower to pay its debts as
they mature; or the admission in writing by the Borrower of its inability to
pay its debts as they mature; or the calling of a meeting of the Borrower's
creditors for purposes of compromising any of the Borrower's debts;
(f) the commencement by or against the Borrower of any
bankruptcy, insolvency, arrangement, reorganization, receivership or similar
proceedings under any federal or state law and, in the case of any such
involuntary proceeding, such proceeding remains undismissed or unstayed for
ninety days following the commencement thereof, or any action by the Borrower
is taken authorizing any such proceedings;
(g) an assignment for the benefit of creditors is made by
the Borrower, whether voluntary or involuntary, or the appointment of a
trustee, custodian, receiver or similar official for the Borrower authorizing
any such proceeding;
(h) the Borrower shall (i) default in the payment of
principal or interest on any indebtedness (other than the Obligations) in an
amount in excess of $100,000 beyond the period of grace, if any, provided in
the instrument or agreement under which such indebtedness was created; or (ii)
default
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14-LOAN AND SECURITY AGREEMENT
15
in the observance or performance of any other agreement or condition relating
to any such indebtedness beyond any grace period or contained in any instrument
or agreement relating thereto, or any other event shall occur or condition
exist, the effect of which default or other event or condition is to cause, or
to permit the holder or holders of such indebtedness to cause, with the giving
of notice if required, such indebtedness to become due prior to its stated
maturity.
(i) the Borrower suffers or sustains a Material Adverse Change;
(j) any federal tax lien is filed of record against the Borrower and
is not bonded or discharged within three Business Days;
(k) any judgment in an amount in excess of $100,000 shall be rendered
against the Borrower which shall not be stayed, vacated, bonded or discharged
within sixty days;
(l) any material covenant, agreement or obligation made by the
Borrower and contained in or evidenced by any of the Loan Documents shall cease
to be enforceable, or shall be determined to be unenforceable, in accordance
with its terms; the Borrower shall deny or disaffirm the Obligations under any
of the Loan Documents or any liens granted in connection therewith; or any liens
granted on any of the Collateral in favor of the Lender shall be determined to
be void, voidable or invalid, or are not given the priority contemplated by this
Agreement;
(m) there is a change in the ownership of control of the Borrower; or
(n) an Event of Taxability shall occur.
9. REMEDIES. If any Event of Default shall have occurred and be
continuing:
(a) The Lender may, without prejudice to any of its other rights
under any Loan Document or applicable law, declare all Obligations to be
immediately due and payable (except with respect to any Event of Default set
forth in Section 8(f) hereof, in which case all Obligations shall automatically
become immediately due and payable without necessity of any declaration)
without presentment, representation, demand of payment or protest, which are
hereby expressly waived.
(b) The Lender may take possession of the Collateral and, for that
purpose may enter, with the aid and assistance of any person or persons, any
premises where the Collateral or any part thereof is, or may be placed, and
remove the same.
(c) The obligation of the Lender, if any, to give additional (or to
continue) financial accommodations of any kind to the Borrower shall
immediately terminate.
(d) The Lender may exercise in respect of the Collateral, in
addition to other rights and remedies provided for herein (or in any other Loan
Document) or otherwise available to it, all the rights and remedies of a
secured party under the Uniform Commercial Code (the "UCC") whether or not the
UCC applies to the affected Collateral and also may (i) require the Borrower
to, and the Borrower hereby agrees that it will at its expense and upon request
of the Lender forthwith, assemble all or part of the Collateral as directed by
the Lender and make it available to the Lender at a place to be designated
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15 - LOAN AND SECURITY AGREEMENT
16
by the Lender that is reasonably convenient to both parties and (ii) without
notice except as specified below, sell the Collateral or any part thereof in
one or more parcels at public or private sale, at any of the Lender's offices
or elsewhere, for cash, on credit or for future delivery, and upon such other
terms as are commercially reasonable. The Borrower agrees that, to the extent
notice of sale shall be required by law, at least ten days' notice to the
Borrower of the time and place of any public sale or the time after which any
private sale is to be made shall constitute reasonable notification. The Lender
shall not be obligated to make any sale of Collateral regardless of notice of
sale having been given. The Lender may adjourn any public or private sale from
time to time by announcement at the time and place fixed therefor, and such
sale may, without further notice, be made at the time and place to which it was
so adjourned.
(e) All cash proceeds received by the Lender in respect of any sale
of, collection from, or other realization upon all or any part of the
Collateral shall be applied by the Lender against the Obligations. Any surplus
of such cash or cash proceeds held by the Lender and remaining after the full
and final payment of all the Obligations shall be promptly paid over to the
Borrower or to such other Person to which the Lender may be required under
applicable law, or directed by a court of competent jurisdiction, to make
payment of such surplus.
10. MISCELLANEOUS PROVISIONS.
10.1 NOTICES. Except as otherwise provided herein, all notices,
approvals, consents, correspondence or other communications required or desired
to be given hereunder shall be given in writing and shall be delivered by
overnight courier, hand delivery or certified or registered mail, postage
prepaid, if to the Issuer, then to Washington Economic Development Finance
Authority, 0000 Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, XX 00000, Attn: Executive
Director, if to the Lender, then to Technology Finance Division, 000 Xxxxxxxxxx
Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxx 00000, Attention: Assistant Vice President,
Lease Administration, with a copy to the Lender at Riverway II, West Office
Tower, 0000 Xxxx Xxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000, Attention: Legal
Department or such other address as shall be designated by the Lender to the
Borrower in accordance herewith, and if to the Borrower, then to 0000 Xxxxxxxxx
Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxx 00000, Attention: Xxxxxxx X. Xxxx, Chief
Financial Officer, or such other address as shall be designated by the Borrower
to the Lender in accordance herewith. All such notices and correspondence shall
be effective when received.
10.2 BORROWER REMAINS LIABLE. Anything herein to the contrary
notwithstanding, (a) the Borrower shall remain liable, under the contracts and
agreements included in the Collateral to the extent set forth therein to
perform all of its duties and obligations thereunder to the same extent as if
this Agreement had not been executed, (b) the exercise by the Lender of any of
the rights hereunder shall not release the Borrower from any of its duties or
obligations under the contracts and agreements included in the Collateral, and
(c) the Lender shall not have any obligation or liability under the contracts
and agreements included in the Collateral by reason of this Agreement, nor
shall the Lender be obligated to perform any of the obligations or duties of
the Borrower thereunder or to take any action to collect or enforce any claim
for payment assigned hereunder.
10.3 LENDER APPOINTED ATTORNEY-IN-FACT. The Borrower hereby irrevocably
appoints the Lender the Borrower's attorney-in-fact, with full authority in the
place and stead of the Borrower and in the name of the Borrower or otherwise,
from time to time in the discretion of the Lender, to take any
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16 - LOAN AND SECURITY AGREEMENT
17
action and to execute any instrument which the Lender may deem necessary or
advisable to accomplish the purpose of this Agreement, including, without
limitation:
(a) to obtain and adjust insurance required to be paid to the Lender
hereunder;
(b) upon the occurrence and during the continuance of an Event of
Default, to ask, demand, collect, xxx for, recover, compromise, receive and
give acquittance and receipts for moneys due and to become due under or in
respect of any of the Collateral;
(c) to receive, indorse and collect any drafts or other instruments,
documents and chattel paper, in connection with clause (a) or (b) above; and
(d) upon the occurrence and during the continuance of an Event of
Default, to file any claims or take any action or institute any proceedings
which the Lender may deem necessary or desirable for the collection of any of
the Collateral or otherwise to enforce the rights of the Lender with respect
to any of the Collateral.
10.4 HEADINGS. The headings in this Agreement are for purposes of
reference only and shall not affect the meaning or construction of any
provision of this Agreement.
10.5 ASSIGNMENTS. The Borrower shall not have the right to assign its
obligations under this Agreement or any interest therein. The Lender may not
assign its rights or delegate its obligations under the Bond or this Agreement
except as permitted by this Agreement and the Bond. The Bond may be transferred
by Lender if Lender delivers the following to Issuer: (i) an opinion of
nationally recognized bond counsel to Issuer to the effect that such transfer
and reregistration will not violate the registration requirements of federal or
State securities laws, and (ii) an investment letter in substantially the same
form as delivered to Issuer by Lender on the Closing Date executed by the
proposed new owner of the Bond. Any attempt by Lender to transfer any interest
in the Bond to any other person shall be void, and in such event Lender shall
defend, indemnify and hold harmless the Issuer against any claims relating to
any such transfer. In no event shall any transfer of the Bond result in the
Bond being owned by more than one owner. In addition to the foregoing, no such
transfer of the Bond or assignment of this Agreement by Lender shall be
effective unless and until Issuer and Borrower shall have received notice of
the transfer or assignment disclosing the name and address of the assignee or
subassignee. Upon receipt of notice of assignment, Borrower will reflect in a
book entry the assignee designated in such notice of assignment, and shall
agree to make all payments to the assignee designated in the notice of
assignment, notwithstanding any claim, defense, setoff or counterclaim
whatsoever (whether arising from a breach of this Agreement or otherwise) that
Issuer and Borrower may from time to time have against Lender or the assignee.
Borrower agrees to execute all documents, including notices of assignment and
chattel mortgages or financing statements, which may be reasonably requested by
Lender or its assignee to protect their interest in the Collateral and in this
Agreement. Notwithstanding the foregoing, Lender agrees that it will not make
any such assignment or transfer under this section to a direct competitor of
Borrower without Borrower's express written consent.
10.6 AMENDMENTS, WAIVERS AND CONSENTS. Any amendment or waiver of any
provision of this Agreement and any consent to any departure by the Borrower
from any provision of this
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17 - LOAN AND SECURITY AGREEMENT
18
Agreement shall be effective only by a writing signed by the Issuer, Lender and
Borrower and shall bind and benefit the parties and their respective successors
and assigns, subject, in the case of the Borrower, to the first sentence of
Section 10.5. Acquiescence in a course of performance rendered under this
Agreement shall not be relevant in determining the meaning of this Agreement
even though the accepting or acquiescing party had knowledge of the nature of
the performance and opportunity for objection.
10.7 CONTINUING SECURITY INTEREST. This Agreement shall create a
continuing security interest in the Collateral and shall (a) remain in full
force and effect until the indefeasible payment in full of the Obligations, (b)
be binding upon the Borrower and its successors and assigns and (c) inure,
together with the rights and remedies of the Issuer and Lender hereunder, to
the benefit of the Issuer and Lender and their respective successors,
transferees and assigns.
10.8 REINSTATEMENT. To the extent permitted by law, this Agreement
and the rights and powers granted to the Issuer and Lender hereunder and under
the Loan Documents shall continue to be effective or be reinstated if at any
time any amount received by the Issuer and Lender in respect of the Obligations
is rescinded or must otherwise be restored or returned by the Lender upon the
insolvency, bankruptcy, dissolution, liquidation or reorganization of the
Borrower or upon the appointment of any receiver, intervenor, conservator,
trustee or similar official for the Borrower or any substantial part of its
assets, or otherwise, all as though such payments had not been made.
10.9 SURVIVAL OF PROVISIONS. All representations, warranties and
covenants of the Borrower contained herein shall survive the execution and
delivery of this Agreement, and shall terminate only upon the full and final
payment and performance by the Borrower of the Obligations secured hereby.
10.10 INDEMNIFICATION. The Borrower agrees to indemnify and hold
harmless the Lender and its directors, officers, agents, employees and counsel
from and against any and all costs, expenses, claims, or liability incurred by
the Lender or such Person hereunder and under any other Loan Document or in
connection herewith or therewith, unless such claim or liability shall be due
to willful misconduct or gross negligence on the part of the Lender or such
Person.
10.11 GOVERNING LAW. THE VALIDITY, INTERPRETATION AND ENFORCEMENT OF
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF WASHINGTON WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW
PRINCIPLES THEREOF.
10.12 VENUE; SERVICE OF PROCESS. ANY LEGAL ACTION OR PROCEEDING WITH
RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE
COURTS OF THE STATE OF WASHINGTON SITUATED IN KING COUNTY, OR OF THE UNITED
STATES OF AMERICA FOR THE WESTERN DISTRICT OF WASHINGTON, AND, BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, THE BORROWER HEREBY ACCEPTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE
AFORESAID COURTS. THE BORROWER HEREBY IRREVOCABLY WAIVES, IN CONNECTION WITH
ANY SUCH ACTION OR PROCEEDING, (A) ANY OBJECTION, INCLUDING, WITHOUT
LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF
FORUM NON CONVENIENS, THAT IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY
SUCH ACTION OR PROCEEDING IN
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18 - LOAN AND SECURITY AGREEMENT
19
SUCH RESPECTIVE JURISDICTIONS AND (B) THE RIGHT TO INTERPOSE ANY NONCOMPULSORY
SETOFF, COUNTERCLAIM OR CROSS-CLAIM. THE BORROWER IRREVOCABLY CONSENTS TO THE
SERVICE OF PROCESS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL,
POSTAGE PREPAID, TO THE BORROWER AT THE ADDRESS FOR IT SPECIFIED IN SECTION 10
HEREOF. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE LENDER TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE
PROCEED AGAINST THE BORROWER IN ANY OTHER JURISDICTION, SUBJECT IN EACH
INSTANCE TO THE PROVISIONS HEREOF WITH RESPECT TO RIGHTS AND REMEDIES.
10.13 DELAYS; PARTIAL EXERCISE OF REMEDIES. No delays or omission of
the Lender to exercise any right hereunder, whether before or after the
happening of any Event of Default, shall impair any such right or shall operate
as a waiver thereof or as a waiver of any such Event of Default. No single or
partial exercise by the Lender of any right or remedy shall preclude any other
or further exercise thereof, or preclude any other right or remedy.
10.14 WAIVER OF JURY TRIAL. THE BORROWER AND THE LENDER IRREVOCABLY
WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
10.15 ENTIRE AGREEMENTS. The Issuer, Borrower and Lender agree that
this Agreement and the Exhibits hereto are the complete and exclusive statement
and agreement between the parties with respect to the subject matter hereof,
superseding all proposals and prior agreements, oral or written, and all other
communications between the parties with respect to the subject matter hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the date first set forth above and to be accepted by its duly authorized
officer.
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19 - LOAN AND SECURITY AGREEMENT
20
WASHINGTON ECONOMIC DEVELOPMENT
FINANCE AUTHORITY
By: /s/ XXXXXXX X. XXXXXXXXX
-------------------------------
Xxxxxxx X. Xxxxxxxxx, Chair
INTRACEL CORPORATION
By:
Name:
Title:
(FED ID NO. ###-##-####)
TRANSAMERICA BUSINESS CREDIT CORPORATION
By:
Name:
Title:
--------------------------------------------------------------------------------
SIGNATURE PAGE
21
WASHINGTON ECONOMIC DEVELOPMENT
FINANCE AUTHORITY
By:
-------------------------------
Xxxxxxx X. Xxxxxxxxx, Chair
INTRACEL CORPORATION
By: /s/ [ILLEGIBLE]
-------------------------------
Name:
Title:
(FED ID NO. ###-##-####)
TRANSAMERICA BUSINESS CREDIT CORPORATION
By:
Name:
Title:
--------------------------------------------------------------------------------
SIGNATURE PAGE
22
WASHINGTON ECONOMIC DEVELOPMENT
FINANCE AUTHORITY
By:
-------------------------------
Xxxxxxx X. Xxxxxxxxx, Chair
INTRACEL CORPORATION
By: /s/ [ILLEGIBLE]
-------------------------------
Name:
Title:
(FED ID NO. ###-##-####)
TRANSAMERICA BUSINESS CREDIT CORPORATION
By: /s/ XXXX X. XXXX
-------------------------------
Name: Xxxx X. Xxxx
Title: Vice President
--------------------------------------------------------------------------------
SIGNATURE PAGE
23
EXHIBIT A
DESCRIPTION OF PROJECT AND SCHEDULE OF LOAN PAYMENTS
Description of Project: Acquisition of equipment to be used by Borrower in
connection with the manufacture of medical diagnostic devices. The Borrower's
facilities are located in Issaquah, Washington.
Schedule of Loan Payments: Attached
24
09/29/1997 Page 1
INTRACEL CORPORATION C/S# 1007-001
Compound Period.......: Monthly
Nominal Annual Rate...: 10.946 %
Effective Annual Rate.: 11.512 %
Periodic Rate.........: 0.9122 %
Daily Rate............: 0.02999%
CASH FLOW DATA
Event Start Date Amount Number Period End Date
--------- ---------- ---------- ------ ------ ----------
1 Loan 09/30/1997 713,339.49 1
2 Payment 09/30/1997 506.85 1
3 Payment 10/01/1997 30,416.80 1
4 Payment 11/01/1997 15,208.40 58 Monthly 08/01/2002
AMORTIZATION SCHEDULE - Normal Amortization
Date Payment Interest Principal Balance
--------------- ---------- --------- --------- ----------
Loan 09/30/1997 713,339.49
1 09/30/1997 506.95 0.00 506.95 712,832.54
2 10/01/1997 30,416.80 213.77 30,203.03 682,629.51
3 11/01/1997 15,208.40 6,226.63 8,981.77 673,647.74
4 12/01/1997 15,208.40 6,144.70 9,063.70 654,584.04
1997 Totals 61,340.55 12,585.10 48,755.45
5 01/01/1998 15,208.40 6,082.02 9,146.38 655,437.66
6 02/01/1998 15,208.40 5,978.59 9,229.81 648,207.85
7 03/01/1998 15,208.40 5,894.40 9,314.00 636,893.85
8 04/01/1998 15,208.40 5,809.45 9,398.95 627,494.90
9 05/01/1998 15,208.40 5,723.71 9,494.89 618,010.21
10 06/01/1998 15,208.40 5,637.20 9,571.20 608,439.01
11 07/01/1998 15,208.40 5,549.89 9,658.51 598,780.50
12 08/01/1998 15,208.40 5,461.79 9,746.81 589,033.89
13 09/01/1998 15,208.40 5,372.89 9,835.51 579,198.38
14 10/01/1998 15,208.40 5,283.18 9,925.22 569,273.16
15 11/01/1998 15,208.40 5,192.64 10,015.76 559,257.40
16 12/01/1998 15,208.40 5,101.28 10,107.12 548,150.28
1998 Totals 182,500.80 67,067.04 115,433.76
17 01/01/1999 15,208.40 5,009.09 10,199.31 538,950.97
18 02/01/1999 15,208.40 4,916.06 10,292.34 528,658.63
19 03/01/1999 15,208.40 4,622.18 10,386.22 518,272.41
20 04/01/1999 15,208.40 4,727.44 10,480.96 507,791.45
21 05/01/1999 15,208.40 4,631.84 10,576.56 497,214.89
22 06/01/1999 15,208.40 4,535.36 10,673.04 488,541.85
23 07/01/1999 15,208.40 4,438.01 10,770.39 475,771.46
24 08/01/1999 15,208.40 4,339.76 10,868.54 454,902.82
25 09/01/1999 15,208.40 4,240.63 10,967.77 453,935.05
25
09/29/997 Page 2
INTRACEL CORPORATION C/S# 1007-001
--------------------------------------------------------------------------------
Date Payment Interest Principal Balance
--------------------------------------------------------------------------------
26 10/01/1999 15,208.40 4,140.58 11,067.82 442,867.23
27 11/01/1999 15,208.40 4,039.83 11,168.77 431,696.46
28 12/01/1999 15,208.40 3,937.75 11,270.65 420,427.81
1999 Totals 182,500.80 53,778.33 128,722.47
29 01/01/2000 15,208.40 3,834.94 11,373.45 409,054.35
30 02/01/2000 15,208.40 3,731.20 11,477.20 397,557.15
31 03/01/2000 15,208.40 3,626.51 11,581.89 385,995.26
32 04/01/2000 15,208.40 3,520.87 11,687.53 374,307.73
33 05/01/2000 15,208.40 3,414.26 11,794.14 362,513.59
34 06/01/2000 15,208.40 3,306.68 11,901.72 350,611.87
35 07/01/2000 15,208.40 3,198.12 12,010.28 338,601.59
36 08/01/2000 15,208.40 3,088.56 12,119.84 326,481.75
37 09/01/2000 15,208.40 2,978.01 12,230.39 314,251.36
38 10/01/2000 15,208.40 2,866.45 12,341.95 301,909.41
39 11/01/2000 15,208.40 2,753.88 12,454.52 289,454.89
40 12/01/2000 15,208.40 2,640.27 12,568.13 276,886.76
2000 Totals 182,500.80 35,959.75 143,541.05
41 01/01/2001 15,208.40 2,525.63 12,662.77 264,203.99
42 02/01/2001 15,208.40 2,409.94 12,798.46 251,405.53
43 03/01/2001 15,208.40 2,293.20 12,915.20 238,490.33
44 04/01/2001 15,208.40 2,175.40 13,033.00 225,457.33
45 05/01/2001 15,208.40 2,056.52 13,151.88 212,305.45
46 06/01/2001 15,208.40 1,936.55 13,271.85 188,033.60
47 07/01/2001 15,208.40 1,815.49 13,392.91 185,640.69
48 08/01/2001 15,208.40 1,693.33 13,516.07 172,125.62
49 09/01/2001 15,208.40 1,570.05 13,638.35 158,487.27
50 10/01/2001 15,208.40 1,445.65 13,762.75 144,724.52
51 11/01/2001 15,208.40 1,320.11 13,888.29 130,836.23
52 12/01/2000 15,208.40 1,193.43 14,014.97 116,821.26
2001 Totals 182,500.80 22,435.30 160,065.50
53 01/01/2002 15,208.40 1,065.59 14,142.81 102,878.45
54 02/01/2002 15,208.40 936.58 14,271.82 88,406.63
55 03/01/2002 15,208.40 806.50 14,402.00 74,004.63
56 04/01/2002 15,208.40 675.05 14,533.36 59,471.27
57 05/01/2002 15,208.40 642.47 14,665.93 44,805.34
58 06/01/2002 15,208.40 408.69 14,799.71 30,005.63
59 07/01/2002 15,208.40 273.70 14,934.70 15,070.93
60 08/01/2002 15,208.40 137.47 15,070.93 0.00
2002 Totals 121,667.20 4,845.94 116,821.26
Grand Totals 913,010.95 199,871.46 713,339.49
26
September 30, 1997
Transamerica Business Credit Corporation
Riverway II
West Office Tower
0000 Xxxx Xxxxxxx Xxxx
Xxxxxxxx, XX 00000
Ladies and Gentlemen:
Reference is made to the Security Agreement dated as of September 30,
1997 executed by the undersigned in favor of Transamerica Business Credit
Corporation ("Lender").
The undersigned authorizes and directs Leader to disburse the proceeds
of the loan as follows:
PAYEE ADDRESS AMOUNT
Intracel Corporation 0000 XX Xxxxxxxxxx Xxxx, Xxxxx 000 $308,335.16
Xxxxxxxx, XX 00000
Xxxxxxxx Technologies 00000 X.X. 00xx Xxxxxx $ 13,346.00
Xxxxxxxx, XX 00000
Scientek #000 - 00000 Xxxxxxxxxx Xxxx $ 50,145.00
Xxxxxxxx, XX Xxxxxx X0X 173
Xxxxxx Xxxxxx & Equipment 0000 X.X. 0xx Xxxxx $ 14,874.00
Xxxxxxxx, XX 00000-0000
Inova Pac-Systeme 0000 Xxxxxxxx Xxxxx $126,449.70
XX Xxx 00000
Xxxxx Xxx, XX 00000
Urania Engineering Co. 000 Xxxxx Xxxxx Xxxxxx $ 71,730.40
Xxxxxxxx, XX 00000-0000 $ 18,060.00
Telenet, Inc. 00000 00xx Xxxxxx X.X. #000 $ 9,605.85
Xxxxxxx, XX 00000
Accraply, Inc. 0000 Xxxx Xxxx Xxxxx $ 8,867.76
Xxxxxxxx, XX 00000-0000
VWR Scientific XX Xxx 0000 $ 4,176.31
Xxx Xxxxxxxxx, XX 00000 $ 3,232.06
$ 2,395.00 $ 9,803.37
Bio Rad $11,808.50
$ 5,432.00 $ 17,240.50
Imeca USA, Inc. 0000 Xxxxxx Xxxxx $ 35,958.00
Xxxxxxxx, XX 00000
Transamerica $ 30,932.75
Total $713.339.49
INTRACEL CORPORATION
By: [SIG]
------------------------------------
Name:
Title:
27
EXHIBIT B
FORM OF BOND
THIS BOND HAS NOT BEEN REGISTERED UNDER FEDERAL LAW OR STATE SECURITIES LAWS.
EXCEPT AS PROVIDED HEREIN ANY ATTEMPT TO TRANSFER ANY INTEREST IN THIS BOND TO
ANY OTHER PERSON OTHER THAN THE REGISTERED OWNER NAMED BELOW SHALL BE VOID.
No. R-1 $1,500,000
UNITED STATES OF AMERICA
WASHINGTON ECONOMIC DEVELOPMENT FINANCE AUTHORITY
ECONOMIC DEVELOPMENT REVENUE BOND, SERIES 1997-E
(Intracel Corporation Project)
ORIGINAL PRINCIPAL AMOUNT: $1,500,000
MATURITY DATE: August 1, 2002
DATED DATE: September 30, 1997
REGISTERED OWNER: Transamerica Business Credit Corporation
THE WASHINGTON ECONOMIC DEVELOPMENT FINANCE AUTHORITY (the "Issuer"), a
public body corporate and politic and an instrumentality of the State of
Washington, for value received, hereby promises to pay (but only out of
amounts, if any, on deposit in the Debt Service Fund) to the Registered Owner
set forth above, on the maturity date specified above, unless this Bond shall
have been called for redemption and payment of the redemption price shall have
been duly made or provided for, upon presentation and surrender hereof, the
Principal Amount set forth above, or so much thereof as shall have been
advanced by Lender (defined below), and to pay interest thereon from the dates
that installments of such sum are advanced by the Lender (defined below) as set
forth in the Loan and Security Agreement dated September 30, 1997 (the
"Agreement") between the Issuer, Intracel Corporation, a Delaware corporation,
as Borrower (the "Borrower"), and Transamerica Business Credit Corporation, a
Delaware corporation, as Lender (the "Lender") under the Agreement and as the
Registered Owner of this Bond. Notwithstanding the foregoing, in the event of a
Determination of Taxability (as defined in the Agreement), interest on this
Bond shall accrue at the interest rate set forth in the Agreement plus a
Gross-Up Rate (as defined in the Agreement) in the manner described in the
Agreement.
This Bond is given to avoid the execution of an individual bond or
promissory note for each advance by the Lender to the Issuer for the benefit of
the Borrower.
Principal of and premium, if any, and interest on this Bond shall be
payable in lawful money of the United States of America by the Borrower to the
Debt Service Fund (as defined below) for the account of the Registered Owner
hereof, as assignee of the Issuer, as of the close of business on the dates set
forth in the Agreement. Payment shall be paid by corporate check or by wire
transfer to the Debt Service Fund, as defined in the Agreement.
IN ACCORDANCE WITH RCW 43.163.140(1), THIS BOND IS NOT A GENERAL, SPECIAL
OR MORAL OBLIGATION OF THE STATE OF WASHINGTON OR ANY POLITICAL
28
SUBDIVISION THEREOF, NOR A PLEDGE OF THE FAITH AND CREDIT OF THE STATE OF
WASHINGTON OR ANY POLITICAL SUBDIVISION THEREOF. THE BOND IS A SPECIAL
NONRECOURSE REVENUE OBLIGATION OF THE ISSUER, SECURED BY AND PAYABLE SOLELY
FROM THE AMOUNTS, IF ANY, ON DEPOSIT IN THE DEBT SERVICE FUND. THE ISSUER HAS
NO TAXING POWER, AND NO TAXING POWER IS PLEDGED TO PAYMENT OF THE BOND.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS BOND SET FORTH ON THE
REVERSE HEREOF AND SUCH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME
EFFECT AS IF SET FORTH AT THIS PLACE.
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts and conditions
required to be performed precedent to and in the execution and delivery of the
Resolution and the Agreements and the issuance of this Bond have been performed
in due time, form and manner as required by law, and that the issuance of this
Bond does not exceed or violate any constitutional or statutory limitation.
IN WITNESS WHEREOF, the Washington Economic Development Finance Authority
has caused this Bond to be executed in its name by the manual or facsimile
signature of its Chair and either its Secretary or Executive Director.
Dated: September 30, 1997.
WASHINGTON ECONOMIC DEVELOPMENT FINANCE AUTHORITY
By:
---------------------------
Chair
By:
---------------------------
Secretary or Executive Director
--------------------------------------------------------------------------------
EXHIBIT B-2
29
[FORM OF REVERSE OF BOND]
This Bond of the Washington Economic Development Finance
Authority (the "Issuer") entitled Economic Development Revenue Bond, Series
1997-E (Intracel Corporation Project) in the original principal amount of One
Million Five Hundred Thousand Dollars ($1,500,000)(the"Bond") is issued pursuant
to, under authority of and in full compliance with the Constitution and laws of
the State of Washington, particularly RCW Chapter 43.163, as amended (the"Act"),
a Resolution of the Issuer duly adopted on September 10, 1997 (the
"Resolution"), and a Loan and Security Agreement dated September 30, 1997 (the
"Agreement"), for the purpose of paying a portion of the cost of the Project (as
described in the Agreement) and for paying costs and expenses incidental thereto
and to the issuance of the Bond. The proceeds of the Bond will be loaned to the
Borrower by the Issuer pursuant to the Agreement.
THE BOND IS SUBJECT TO OPTIONAL AND MANDATORY REDEMPTION UNDER
CERTAIN CONDITIONS, AS PROVIDED BELOW AND AS MORE FULLY DESCRIBED IN THE
AGREEMENT.
This Bond is not transferable by the owner hereof except as
expressly provided in Section 10.5 of the Agreement. Any attempt by Lender to
transfer any interest in the Bond to any other person shall be void. In no event
shall any transfer of the Bond result in the Bond being owned by more than one
owner. The Bond is issuable only as a fully registered Bond in the Authorized
Denomination described in the Resolution. Interest on the Bond shall be paid as
provided in the Agreement.
No recourse shall be had for the payment of the principal of,
premium, if any, or interest on the Bond, any advance thereunder or for any
claim based thereon or upon any obligation, covenant or agreement in the
Resolution or the Agreement, against the Issuer or any past, present or future
officer, employee or agent, or member of the Issuer, or successor to the Issuer,
under any rule of law or equity, statute or constitution or by the enforcement
of any assessment or penalty or otherwise, and all such liability of any such
officer, employee or agent, or member of the Issuer or successor to the Issuer
is hereby expressly waived and released as a condition of and in consideration
for the adoption of the Resolution, the execution of the Agreement and the
issuance of the Bond.
The Resolution and the Agreement prescribe the manner in which
this Bond may be discharged and after which the Bond shall no longer be secured
by or entitled to the benefits of the Resolution or the Agreement, except for
the purposes of registration and exchange of the Bond and the payment hereof.
EXHIBIT B-3
30
EXHIBIT C1
FORM OF REQUISITION
TO: Transamerica Business Credit Corporation
FROM: Washington Economic Development Finance Authority
SUBJECT: Loan and Security Agreement dated September __, 1997 (the "Agreement")
regarding Washington Economic Development Finance Authority Economic
Development Revenue Bond, Series 1997-E (Intracel Corporation Project)
(the "Bond")
This represents Requisition Certificate No. ____ in the total amount
of $________ for payment of costs of issuance of the Bond or Project Costs.
Amount of requisition:_______________________________________________
Payable to:__________________________________________________________
Account No.:_________________________________________________________
Amounts received pursuant to this requisition will be loaned by the
Washington Economic Development Finance Authority to Intracel Corporation (the
"Borrower") pursuant to Borrower's requisition, a true and complete copy of
which is attached hereto. You are instructed to transfer amounts pursuant to
this requisition directly to the Borrower in accordance with the terms of this
Agreement.
Terms capitalized herein have the meanings specified in the Agreement.
Executed this __ day of _________, 1997.
WASHINGTON ECONOMIC DEVELOPMENT
FINANCE AUTHORITY
By:_____________________
Name:___________________
Title:__________________
31
EXHIBIT C2
FORM OF REQUISITION
TO: Washington Economic Development Finance Authority
FROM: Intracel Corporation
SUBJECT: Loan and Security Agreement dated September __, 1997 (the "Agreement")
regarding Washington Economic Development Finance Authority Economic
Development Revenue Bond, Series 1997-E (Intracel Corporation
Project)(the "Bond")
This represents Requisition Certificate No. __ in the total amount of
$________ for payment of costs of issuance of the Bond or Project Costs.
Amount of requisition: ____________________________
Payable to: _______________________________________
Account No.: ______________________________________
The undersigned does hereby represent, warrant and certify under the
Agreement that:
1. The expenditures for which funds are requested hereby represent
proper costs of issuance of the Bond or Project Costs, have not been included
in a previous Requisition Certificate and have been properly recorded on the
Company's books. Attached hereto is a list of equipment, together with copies
of supplier's invoices and, if payment is not to be made directly to the
equipment supplier, copies of canceled checks relating to the purchase of the
equipment.
2. The funds requested hereby are not greater than those necessary to
meet obligations due and payable or to reimburse the Company for funds actually
advanced for Project Costs. The money requested does not include retention or
other money not yet due or earned under construction contracts.
3. No more than 2% of the proceeds of the Bond have been, or will be
upon payment under this requisition, used to pay costs of issuance of the Bond,
and substantially all (at lease 95%) of the sum of the payment herein requested
and all other payments from the proceeds of the Bond heretofore made have been
used, as required under Section 144(a) of the Internal Revenue Code of 1986, as
amended (the "Code"), and applicable regulations and rulings issued thereunder,
to finance the acquisition and installation of machinery and equipment for the
Project, all of which property is of a character subject to the allowance for
depreciation under Section 167 of the Code, and no substantial part of the sum
of the payment herein requested and all other payments from the proceeds of the
Bond heretofore made has been or will be used, directly or indirectly, as
working capital or to finance inventory.
4. The Company is not in default under the Agreement and nothing has
occurred to the knowledge of the Company that would prevent the performance of
its obligations under the Agreement.
Terms capitalized herein have the meanings specified in the agreement.
32
Executed this __ day of _____________, 19__.
INTRACEL CORPORATION
By ____________________________
Name __________________________
Title _________________________
33
Page 1 of 1
EXHIBIT D
________________________________________________________________________________
EXHIBIT D
34
INTRACEL CORPORATION
EQUIPMENT LIST
VENDOR EQUIPMENT DESCRIPTION TOTAL COST AMOUNT PAID BALANCE DOCUMENTATION
Carnorsca, Inc. Steam Generator $ 48,670.00 $ 48,670.00 $ Attached
PS VSG-500/50T1
Kunimann Technologies, Inc. Pharmegra Sterilizer $133,400.00 $120,114.00 $ 13,348.00 Attached,
XX0000000 cancelled check
to follow
Lesse Xxxxxxxx Xxxxx Sterilizer Installation $ ? $ $211,771.00 Attached proposal work
not yet complete
Scientek Glassware Washer $ 61,136.00 $ 10,000.00 % 50,145.00 Attached
Xxxxxx Boiler & Equipment Xxxxxx Steam Boiler $ 22,310.00 $ 7,436.00 $ 14,874.00 Attached
Serial # 45270
Inova Pac-Systems Aliso Folding, Inserting $180,671.00 $ 54,221.30 $126,448.70 Attached
& Screw Capping Machine
VFVM 4031 ?
Uranus Engineering Co. Pouch Pro System with $102,472.00 $ 30,741.60 $ 71,730.40 Attached
Dessiccant Dispenser
Telenet, Inc. Phone System $ 72,264.82 $ 82,058.77 $ 9,805.85 Attached, cancelled
check to follow
Accraphy, Inc. Infeed/Outfeed $ 13,295.00 $ ? $ 8,857.76 Attached
Turretable
Uranca Engineering Co. Rotary Band Heat $ 16,080.00 $ 16,080.00 Attached
Sealer with Ink Jet
Printer Interface
Model 3500P
VWR Scientific Masterpro Balance $ 4,176.31 $ 4,176.31 Attached
with 2 Stat Data
Printers
Model 620G X .001G
VWR Scientific Branston ? with $ 3,232.06 $ 3,232.06 To be faxed Tues. 9/23
1/4" micro tip
Model 450
Bio Rad Prep Cell with $ 11,808.50 $ 11,808.50 To be faxed Tues. 9/23
Power Pac
Model 491
Bio Rad Xxxx Protein II $ ? $ 5,423.00 To be faxed Tues. 9/23
Cell/?
Pac 3000 system
VWR Eppendorf Micro- $ 2,395.00 $ 2,395.00 To be faxed Tues. 9/23
centrifuge
Model 5417C
Ismeca USA, Inc. Bio-Line Dispensing $ 36,858.00 $ 35,953.00 Attached
System
Totals $924,601.49 $339,258.91 $586,342.58
35
EXHIBIT E
[Form of Borrower's Counsel Opinion]
36
[XXXXXXXX & XXXXXXXX LLP LETTERHEAD]
September 30, 1997
Washington Economic Development
Finance Authority
0000 0xx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxxxx 00000
Transamerica Business Credit Corporation
00 Xxxxxxxxx Xxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxx 00000-0000
Re: Intracel Corporation
Mesdames and Gentlemen:
We have acted as counsel for Intracel Corporation (the "Company") in
connection with the transaction contemplated by the Loan and Security
Agreement, dated September 30, 1997 (the "Loan Agreement"), among the
Washington Economic Development Finance Authority (the "Issuer"), the Company
and Transamerica Business Credit Corporation (the "Lender"). This opinion is
furnished to you at the request of the Company. Unless otherwise defined
herein, terms defined in the Loan Agreement shall have the same meanings
herein.
We have examined an original copy of the Loan Agreement and the Tax
Certificate and Regulatory Agreement, dated as of the date hereof, between the
Company and the Issuer (the "Tax Regulatory Agreement"). In addition, we have
examined such records, documents, certificates of public officials and of the
Company, made such inquiries of officials of the Company, and considered such
questions of law as we have deemed necessary for the purpose of rendering the
opinions set forth herein.
We have assumed the genuineness of all signatures and the authenticity of
all items submitted to us as originals and the conformity with originals of all
items submitted to us as copies. In making our examination of the Loan
Agreement, we have assumed that each party to the Loan Agreement other than the
Company has the power and authority to execute and deliver, and to perform and
observe the provisions of the Loan Agreement, and has duly authorized, executed
and delivered the Loan Agreement, and that the Loan Agreement constitutes the
legal, valid and binding obligations of such party.
37
Washington Economic Development
Finance Authority
Transamerica Business Credit Corporation
September 30, 1997
Page Two
Our opinion in paragraph (a) below as to the qualification and good
standing of the Company is based solely upon certificates of public officials
in the states named in those paragraphs.
The opinions hereafter expressed are subject to the following further
qualifications and exceptions;
(1) The effect of bankruptcy, insolvency, reorganization, arrangement,
moratorium or other similar laws relating to or affecting the rights of
creditors generally, including, without limitation, laws relating to fraudulent
transfers or conveyances, preferences and equitable subordination.
(2) Limitations imposed by general principles of equity upon the
availability of equitable remedies or the enforcement of provisions of the Loan
Agreement; and the effect of judicial decisions which have held that certain
provisions are unenforceable where their enforcement would violate the implied
covenant of good faith and fair dealing, or would be commercially unreasonable.
(3) We express no opinion as to the effect on the opinions expressed
herein of (i) the compliance or non-compliance of any party to the Loan
Agreement (other than the Company) with any laws or regulations applicable to
it, or (ii) the legal or regulatory status or the nature of the business of any
such party.
(4) We express no opinion herein as to the creation, perfection or
priority of any liens or security interests created or purported to be created
by the Loan Agreement.
(5) The enforceability of provisions of the Loan Agreement providing for
indemnification, to the extent such indemnification is against public policy.
(6) The enforceability of provisions of the Loan Agreement which purport
to establish evidentiary standards or to make determinations conclusive.
(7) The circumstances under which rights of setoff may be exercised.
(8) The enforceability of any provision of the Loan Agreement which
purports to establish particular courts as the forum for the adjudication of
any controversy relating to the Loan Agreement.
38
Washington Economic Development
Finance Authority
Transamerica Business Credit Corporation
September 30, 1997
Page Three
(9) Certain remedial provisions of the Loan Agreement may be
unenforceable in whole or in part under the laws of the State of New York, but
the inclusion of such provisions does not render invalid the Loan Agreement,
and the Loan Agreement contains, in our judgment, adequate provisions for the
practical realization of the benefits afforded thereby.
(10) We have assumed that the current Board of Directors of the Company
was validly elected.
Based upon and subject to the foregoing, we are of the opinion that:
(a) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and is duly qualified and
in good standing in the State of Washington, and has the corporate power and
authority to conduct its business as presently conducted.
(b) The Company has the corporate power and authority to execute and
deliver, and to perform and observe the provisions of, the Loan Agreement.
(c) Each of the Loan Agreement and the Tax Regulatory Agreement has been
duly authorized, executed and delivered by the Company. The Loan Agreement
constitutes valid and binding obligations of the Company enforceable against
the Company in accordance with its terms.
(d) The execution, delivery and performance of the Loan Agreement by the
Company are not in violation of its certificate of incorporation or bylaws.
We express no opinion as to matters governed by any laws other than the
substantive laws of the State of New York (without reference to its
choice-of-law rules), the General Corporation Law of the State of Delaware, and
the federal laws of the United States of America, which are in effect on the
date hereof. We note that the Loan Agreement is governed by the laws of the
State of Washington. In this regard, with respect to the opinions set forth
herein, we have assumed with your permission that the Loan Agreement is
governed by the laws of the State of New York. We express no opinion as to any
choice-of-law provision contained in the Loan Agreement.
39
Washington Economic Development
Finance Authority
Transamerica Business Credit Corporation
September 30, 1997
Page Three
(9) Certain remedial provisions of the Loan Agreement may be
unenforceable in whole or in part under the laws of the State of New York, but
the inclusion of such provisions does not render invalid the Loan Agreement,
and the Loan Agreement contains, in our judgment, adequate provisions for the
practical realization of the benefits afforded thereby.
Based upon and subject to the foregoing, we are of the opinion that:
(a) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and is duly qualified and
in good standing in the State of Washington, and has the corporate power and
authority to conduct its business as presently conducted.
(b) The Company has the corporate power and authority to execute and
deliver, and to perform and observe the provisions of, the Loan Agreement.
(c) Each of the Loan Agreement and the Tax Regulatory Agreement has been
duly authorized, executed and delivered by the Company. The Loan Agreement
constitutes valid and binding obligations of the Company enforceable against
the Company in accordance with its terms.
(d) The execution, delivery and performance of the Loan Agreement by the
Company are not in violation of its certificate of incorporation or bylaws.
We express no opinion as to matters governed by any laws other than the
substantive laws of the State of New York (without reference to its
choice-of-law rules), the General Corporation Law of the State of Delaware, and
the federal laws of the United States of America, which are in effect on the
date hereof. We note that the Loan Agreement is governed by the laws of the
State of Washington. In this regard, with respect to the opinions set forth
herein, we have assumed with your permission that the Loan Agreement is
governed by the laws of the State of New York. We express no opinion as to any
choice-of-law provision contained in the Loan Agreement.
40
Washington Economic Development
Finance Authority
Transamerica Business Credit Corporation
September 30, 1997
Page Four
This opinion is solely for your benefit and may not be relied upon by, nor
may copies be delivered to, any other person without our prior written consent.
In this regard, we acknowledge and agree that a copy of this opinion may be
delivered to Ater Xxxxx Xxxxxx Xxxxxx & Skerrill LLP, bond counsel in respect
of the transactions contemplated by the Loan Agreement, and may be included in
the transcript of the proceedings in connection with such transactions.
Very truly yours,
/s/ [SIG]
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