Exhibit 10.100
LOAN AGREEMENT
BY AND BETWEEN
BANK ONE, NA
AS LENDER
AND
E-LOAN, INC.
AS BORROWER
EFFECTIVE AS OF
APRIL 2, 2001
COLUMBUS, OHIO
Exhibit 10.100
LOAN AGREEMENT
THIS LOAN AGREEMENT ("Agreement") is entered into as of April 2, 2001, by
and between E-LOAN, INC., a Delaware corporation ("Borrower") and BANK ONE, NA,
a national banking association with its principal office in Columbus, Ohio
("Lender').
R E C I T A L S
A. Borrower is engaged in the business of originating and selling
Contracts (as hereinafter defined) to finance the purchase of motor vehicles.
B. The Borrower desires to borrow funds from Lender to finance
Borrower's working capital needs arising in the ordinary course of business,
which borrowings are to be secured by all of the assets of Borrower.
C. Based upon the foregoing and subject to the terms and conditions
hereinafter set forth, Lender is willing to make loans to Borrower.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, the parties hereby agree as follows:
AGREEMENT
SECTION 1. CERTAIN DEFINITIONS AND TERMS
As used herein, the following terms shall have the meanings herein
indicated:
1.1 ADVANCE REQUEST has the meaning set forth in Section 2.2.
1.2 AFFILIATE means any Person who (i) would be an "affiliate" of
Borrower within the meaning of the regulations promulgated pursuant to the
Securities Act of 1933, as such regulations and Act are amended and in effect on
the date in question, if such Person were subject to such Act and regulations,
or (ii) owns any legal or beneficial interest of twenty-five percent (25%) or
more in such Person, is a director or officer of Borrower, or is a relative of
any of the Persons described in this clause (ii).
1.3 AGREEMENT means this Loan Agreement, including any Schedules and
Exhibits hereto, as the same may be in effect from time to time after giving
effect to any amendments, supplements, increases, extensions, and renewals
hereof.
1.4 BORROWING BASE means, at any date of determination, an amount
equal to 92% of the aggregate amount of the principal balances outstanding under
the Eligible Contracts as calculated by Borrower's accounting systems and as
agreed to by Lender; provided, however, at any date of determination, no more
than ten percent (10%) of the
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Exhibit 10.100
Borrowing Base calculation shall be attributable to: (i) Sub Prime Contracts; or
(ii) Contracts which have been included in the Borrowing Base calculation for
longer than six (6) days. The Borrowing Base value of each Eligible Contract
shall amortize monthly by the reduction in principal balance of such Eligible
Contract calculated on the basis of a simple interest amortization.
1.5 BORROWING BASE REPORT means a certificate containing such
information as Lender may request concerning the amount or calculation of the
Borrowing Base.
1.6 BORROWING DATE has the meaning set forth in Section 2.2.
1.7 BUSINESS DAY means any day excluding Saturday, Sunday and holidays
and excluding any other day on which Lender is required or authorized to close.
1.8 CLAIM has the meaning set forth in Section 5.1 (e).
1.9 CLOSING DATE means the date of the initial advance hereunder.
1.10 CODE means the Internal Revenue Code of 1986, as amended, and all
regulations promulgated and rulings issued thereunder.
1.11 COLLATERAL means all present and future tangible or intangible
property and rights of any kind in which the Lender is granted a Lien pursuant
to the Security Documents or this Agreement (whether or not perfected) and shall
include all property of Borrower including, without limitation, all Contracts.
The Lien of Lender shall be the only Lien on Contracts of Borrower.
1.12 COMMITMENT means the commitment of the Lender to make Revolving
Credit Loans to Borrower pursuant to Section 2.1 hereof in an aggregate
principal amount at any one time outstanding not to exceed Twenty-Five Million
and 00/100 Dollars ($25,000,000) or such lower amount as may be provided for
pursuant to the terms of this Agreement.
1.13 COMMITMENT FEE means a fee paid to Lender by Borrower in the
amount of One Hundred and Twenty-Five Thousand and 00/100 Dollars ($125,000), as
a condition precedent to this Agreement.
1.14 COMMITMENT PERIOD means the period from and including the Closing
Date to, but not including, the Commitment Termination Date.
1.15 COMMITMENT TERMINATION DATE means the earlier of (i) noon, Eastern
Time, on the first anniversary of the Closing Date, and (ii) the date on which
the Commitment is otherwise terminated in accordance with the terms of this
Agreement.
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Exhibit 10.100
1.16 CONTRACTS means chattel paper, other instruments or documents
arising from direct loans for the purchase or refinance of motor vehicles
evidencing both a debt and security interest in such motor vehicles.
1.17 CONTRACT PURCHASER means a financial institution acceptable to
Lender which has entered into a Contract Purchase Agreement with Borrower.
1.18 CONTRACT PURCHASE AGREEMENT means a written agreement between
Borrower and a Contract Purchaser whereby the Borrower agrees to sell and the
Contract Purchaser agrees to purchase Contracts which satisfy such Contract
Purchaser's Loan Guidelines. All of the Borrower's Contract Purchase Agreements
are attached hereto as EXHIBIT C.
1.19 CURRENT FINANCIALS means the Financial Statements of Borrower for
the fiscal year ending December 31, 2000, and the month ending February 28,
2001.
1.20 DEALER means a retail seller of motor vehicles.
1.21 DEALER AGREEMENT means an agreement between Borrower and a Dealer
whereby Borrower agrees to make a direct loan to a consumer for the purchase of
a motor vehicle from Dealer, provided that Dealer performs certain acts and
provides certain documentation to Borrower, which agreement is in the form of
EXHIBIT D.
1.22 DEALER DRAFT means an instrument executed and delivered by the
Borrower to a Dealer to fund consumer's purchase of a motor vehicle.
1.23 DEBT of any Person includes, without duplication, (i) all
obligations, contingent or otherwise, which in accordance with GAAP should be
classified upon such Person's balance sheet as liabilities, (ii) all obligations
of such Person for borrowed money, (iii) all obligations of such Person
evidenced by bonds, debentures, notes and other similar instruments, (iv) all
obligations of such Person upon which interest charges are customarily paid, (v)
all obligations created or arising under any conditional sale or other title
retention agreement with respect to property acquired by such Person (even
though the rights and remedies of the seller or lender under such agreement in
the event of default are limited to repossession or sale of such property), (vi)
all obligations of such Person issued or assumed as the deferred purchase price
of property or services (other than accounts payable to suppliers incurred in
the ordinary course of business and paid, in each case, within thirty (30) days
of the date when each such account is payable), (vii) all obligations under
leases which shall have been or should be, in accordance with GAAP, recorded as
capitalized leases in respect of which such Person is liable as lessee, and
(viii) all Debt of the types referred to in clauses (i) through (vii) above
directly or indirectly guaranteed by such Person.
1.24 DEFAULT means any event which with the passage of time or the
giving of notice or both will be an Event of Default.
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Exhibit 10.100
1.25 DEFAULT RATE has the meaning set forth in Section 2.7
1.26 ELIGIBLE CONTRACT means a Contract payable to Borrower which meets
all of the following requirements at all relevant times, including, without
limitation, at the time of presentation of each Borrowing Base Report:
(a) arises from the finance by Borrower in the ordinary course
of Borrower's business of an obligor's purchase of a motor vehicle within thirty
(30) days of any date of determination;
(b) complies with the Loan Guidelines of a Contract Purchaser
and is subject to purchase by Contract Purchasers within three (3) Business Days
of receipt by Borrower of all documentation required under the Borrower's Dealer
Agreement;
(c) is subject to the Dealer Agreement requiring the Dealer to
supply documentation as set forth therein;
(d) has not been included in the Borrowing Base calculation for
more than ten (10) Business Days;
(e) represents a valid and binding obligation enforceable in
accordance with its terms for the amount outstanding thereof without offset,
counterclaim or defense (whether actual or alleged) and is not subject to
rescission;
(f) complies in all respects with applicable Law, including,
without limitation, truth in lending and credit disclosure laws and regulations;
(g) is secured by a first priority security interest in and
lien on the motor vehicle financed by such Contract and Lender has been granted
a first priority perfected Lien on such collateral interest of Borrower and a
first priority perfected Lien on the Contract and the Contract is free and clear
of any liens or claims of any other Person;
(h) the obligor thereon is not subject to any pending
receivership, insolvency or bankruptcy proceeding;
(i) the obligor thereon is not an Affiliate of Borrower or
employed by Borrower;
(j) the obligor thereunder has a FICO score of at least 500 and
has accepted delivery of and is in possession of the motor vehicle subject of
the Contract and such vehicle has not been returned by the obligor or
repossessed by Borrower;
(k) the first payment thereunder is due within forty-five (45)
days of the Contract's origination;
(l) all payments under the Contract are current;
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Exhibit 10.100
(m) the terms and provisions thereof have not been amended,
modified or extended;
(n) has not been charged-off;
(o) complies with other criteria which Lender may establish at
any time and from time to time, within its sole discretion.
At the discretion of Lender, a Contract may be deemed an Eligible
Contract pending receipt by Lender of documentation required by Lender to
determine eligibility. Lender reserves the right to determine if a Contract
complies with the foregoing criteria, in its sole discretion. An Eligible
Contract shall become ineligible at any time in which it fails to meet the
foregoing criteria.
1.27 ERISA means the Employee Retirement Income Security Act of 1974,
as amended, and the regulations promulgated and rulings issued thereunder.
1.28 ERISA AFFILIATE means any Person who for purposes of Title IV of
ERISA is a member of Borrower's control group, or who is under common control
with Borrower, within the meaniof Section 414 of the Code and the regulations
promulgated and rulings issued thereunder.
1.29 EVENT OF DEFAULT has the meaning set forth in Section 6 of this
Agreement and in the Loan Documents.
1.30 FINANCIAL REPORT CERTIFICATE means a certificate containing such
certifications, statements, calculations, explanations, and conclusions as
Lender may require concerning compliance with the Loan Documents in form and
substance satisfactory to Lender, presently in the form of EXHIBIT B.
1.31 FINANCIAL STATEMENTS means balance sheets, profit and loss
statements, and statements of cash flows prepared in comparative form with
respect to the corresponding period of the preceding fiscal year and prepared in
accordance with GAAP.
1.32 GAAP means all applicable generally accepted accounting principles
of the Accounting Principles Board of the American Institute of Certified Public
Accountants and the Financial Accounting Standards Board which are applicable as
of the date of the Current Financials.
1.33 GOVERNMENTAL AUTHORITY means any nation or government, any state,
county, or city and any political subdivision of any of the foregoing and any
entity exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.
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Exhibit 10.100
1.34 LNDEMNIFIED PARTY has the meaning set forth in Section 5.1(e).
1.35 INDEMNITY MATTERS has the meaning set forth in Section 5.1 (e).
1.36 LAW means all applicable statutes, laws, ordinances, regulations,
orders, writs, injunctions or decrees of any Governmental Authority.
1.37 LIBOR RATE means the offered rate for the period equal to or next
greater than the ninety (90) day rate for U.S. Dollar deposits of not less than
$1,000,000 as of 11:00 a.m., City of London, England time, two London Business
Days prior to the first day of the calendar month as shown on the display
designated as "British Bankers Association Interest Settlement Rates" on Reuters
for the purpose of displaying such rate. In the event such rate is not available
on Reuters, then such offered rate shall be otherwise independently determined
by Lender from an alternate, substantially similar independent source available
to Lender or shall be calculated by Lender by a substantially similar
methodology as theretofore used to determine such offered rate. The LIBOR Rate
shall be a fixed rate for the duration of each calendar month. The initial LIBOR
Rate shall be the rate in effect two (2) Business Days prior to the Closing Date
and shall be adjusted on the last day of each calendar month to the LIBOR Rate
in effect two (2) Business Days prior to such date.
1.38 LIEN means any mortgage, pledge, assignment, security interest,
encumbrance, lien, charge or deposit arrangement or other arrangement having the
practical effect of the foregoing and shall include the interest of a vendor or
lessor under any conditional sale agreement, capitalized lease or other title
retention agreement.
1.39 LITIGATION means any proceeding, claim, lawsuit or investigation
conducted or threatened by or before any Governmental Authority.
1.40 LOAN DOCUMENT(S) means this Agreement, the Revolving Credit Note,
the Security Documents and any other agreements, notes, guaranties,
certificates, instruments or other documents delivered pursuant to or therewith
as the same may be amended, modified, supplemented, extended or restated.
1.41 LOAN GUIDELINES means the loan guidelines issued to Borrower by a
Contract Purchaser pursuant to which Borrower enters into or purchases and sells
Eligible Contracts.
1.42 MATERIAL ADVERSE EFFECT means any set of circumstances or events
which would reasonably be expected to (i) have any adverse effect upon the
validity or enforceability of any Loan Document, (ii) be material and adverse to
the financial condition or business operations of Borrower or to the prospects
of Borrower, or (iii) cause a Default or an Event of Default.
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Exhibit 10.100
1.43 MATERIAL ASSETS means any asset which has a book or appraised
value of or is sold for consideration of $20,000 or more.
1.44 MAXIMUM RATE means the maximum rate or amount of interest which
Lender is allowed to contract for, charge, take, reserve or receive under
applicable Law.
1.45 MULTIEMPLOYER PLAN means a multiemployer plan as defined in
Sections 3(37) or 4001 (a) (3) of ERISA or Section 414 of the Code.
1.46 OBLIGATIONS means (i) the obligation of Borrower for the due and
punctual payment of the principal of and interest on the Revolving Credit Note
when due, whether at maturity, by acceleration, by notice of voluntary
prepayment or otherwise, (ii) all other obligations and all out-of-pocket
expenses and indemnities now or hereafter existing of Borrower to Lender under
this Agreement, (iii) all out-of-pocket costs and expenses, now or hereafter
existing, that may be incurred by Lender in connection with the administration
(as set forth in Section 5.1 (i)) and enforcement of the Loan Documents or the
realization on the security provided for by the Loan Documents, (iv) the
obligations of each of the pledgors, debtors, grantors, mortgagors, guarantors
or other Person obligated to Lender under the Security Documents, and (v) all
obligations of Borrower under Section 5.1 (e).
1.47 PERMITTED LIENS has the meaning set forth in Section 4.13.
1.48 PERSON means any individual, sole proprietorship, partnership,
joint venture, trust, unincorporated organization, association, corporation,
institution, entity, party, or Governmental Authority.
1.49 PLAN means any employee pension benefit plan as defined in Section
3(2) of ERISA that is covered by Title IV of ERISA (including a Multiemployer
Plan) or subject to the minimum funding standards of Section 412 of the Code
which is or has been maintained for the employees of Borrower or any ERISA
Affiliate.
1.50 REVOLVING CREDIT LOANS has the meaning set forth in Section 2.l.
1.51 REVOLVING CREDIT NOTE has the meaning set forth in Section 2.3.
1.52 REVOLVING RATE has the meaning set forth in Section 2.5.
1.53 RIGHTS means rights, remedies, powers, privileges and benefits.
1.54 SECURITY AGREEMENTS means those certain security agreements by and
between Borrower and the Lender in form and content acceptable to Lender and
Borrower as the same may be amended, supplemented, or otherwise modified from
time to time.
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Exhibit 10.100
1.55 SECURITY DOCUMENTS means (i) the Security Agreements and (ii) all
other documents, certificates and instruments from time to time securing or
guaranteeing the Obligations, in each case as the same may be amended, modified,
restated, supplemented, renewed, extended, substituted for or replaced from time
to time.
1.56 SUBSIDIARY is every firm, corporation, association, partnership,
joint venture, trust, or other entity of which an aggregate of fifty percent
(50%) or more of the equity interests or the issued and outstanding stock having
ordinary voting power (except directors' qualifying shares) is, at the time the
determination is being made, is owned, either directly or indirectly, or is
controlled by a Person in control of the Borrower or one or more such Person's
Subsidiaries.
1.57 SUB PRIME CONTRACT means Contracts with obligors who have a FICO
score of between 500 and 599. For purposes of this Agreement, the term "Sub
Prime Contract" shall not include Contracts with obligors who have a FICO score
of below 500.
1.58 TANGIBLE NET WORTH means total assets minus all indebtedness,
obligations or liabilities of (excluding indebtedness, obligations or
liabilities which are subordinated to the Obligations,) all determined in
accordance with GAAP; provided, however, for purposes of any computation of
Tangible Net Worth, "assets" shall not include (i) goodwill (whether
representing the excess of cost over book value of assets acquired or
otherwise), (ii) patents, trademarks, trade names, copyrights, and franchises,
(iii) Debt owed by any Affiliate of the Borrower, and (iv) all other similar
assets which would be classified as intangible assets under GAAP.
1.59 TAXES means all taxes, assessments, fees, levies, imposts, duties,
deductions, withholdings, or other charges of any nature whatsoever from time to
time or at any time imposed by any Law or Governmental Authority.
1.60 UCC means the Uniform Commercial Code as enacted in the State of
Ohio or other applicable jurisdiction, as amended.
1.61 UNUSED LINE FEE has the meaning set forth in Section 2.14.
SECTION 2. REVOLVING CREDIT FACILITY.
2.1 REVOLVING CREDIT COMMITMENT. Subject to and in reliance upon the
terms, conditions, representations and warranties contained in this Agreement,
Lender agrees to make revolving credit loans to Borrower in one or more advances
(the "Revolving Credit Loans") so long as the aggregate of the Revolving Credit
Loans outstanding never exceeds the lesser of (a) an amount equal to the
Borrowing Base or (b) the Commitment. Lender shall have no obligation to make
any Revolving Credit Loan on a non-Business Day or on or after the Commitment
Termination Date; provided that, Borrower' Obligations and Lender's Rights under
the Loan Documents shall continue in full force and effect until the Obligations
are paid and performed in full.
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Exhibit 10.100
During the Commitment Period, Borrower may borrow, repay and reborrow the
Revolving Credit Loans in whole or part, all in accordance with terms and
conditions of this Agreement.
2.2 BORROWING PROCEDURE; DISBURSEMENT. Each Revolving Credit Loan
shall be made on Borrower's notice (the "Advance Request") to Lender requesting
an advance on a certain date (the "Borrowing Date") together with a Borrowing
Base Report. Lender shall exercise its best efforts to advance the requested
funds by 3:00 PM Eastern Standard Time on the Borrowing Date; provided, however,
any failure by Lender in such regard shall not be deemed or construed to be a
breach by Lender under this Agreement. Each Advance Request shall be in a form
acceptable to Lender and must be received by Lender no later than noon (Eastern
Time on the Business Day of the Borrowing Date.
2.3 REVOLVING CREDIT NOTE. All Revolving Credit Loans shall be
evidenced by one (1) promissory note executed by Borrower, substantially in the
form of EXHIBIT A attached hereto (the "Revolving Credit Note"), payable to the
order of Lender, representing the obligation of Borrower to pay the aggregate
unpaid principal amount of all Revolving Credit Loans made by Lender, together
with interest thereon as prescribed by this Agreement.
2.4 MANNER OF PAYMENTS. All payments made by Borrower to Lender
hereunder on account of principal, interest or otherwise shall be received by
Lender not later than noon, Eastern Time, at Lender's account number 980404443,
ABA No. 000000000, at Lender's banking office in Columbus, Ohio or at such other
place as Lender shall direct in Columbus, Ohio, in immediately available United
States funds. Any payments made by Borrower to Lender by mail shall not be
effective until received by Lender as set forth in this Section 2.4. If any
payment by Borrower under this Agreement or the Revolving Credit Note is to be
made on a day which is not a Business Day, such payment shall be made on the
next succeeding Business Day and such extension of time will in such case be
included in computing interest in connection with such payment. All payments
shall be made by Borrower to Lender without offset or other reduction.
2.5 INTEREST. The Revolving Credit Loans shall bear interest from day
to day at a rate per annum which shall, from day to day, be equal to the lesser
of (i) the Maximum Rate, or (ii) the LIBOR Rate then in effect plus two and
one-half percent (2.50%) ("Revolving Rate").
Accrued and unpaid interest on the Revolving Credit Loans for each month
(or any shorter period) shall be payable monthly in arrears on the last day of
such month (or shorter period), commencing on the first such date to occur after
the date of this Agreement and continuing regularly and monthly thereafter until
the Obligations evidenced by the Revolving Credit Note are paid in full; and,
interest shall also be paid on the Commitment Termination Date (whether at
stated maturity, by acceleration or otherwise) and, after the Commitment
Termination Date, on demand.
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Exhibit 10.100
2.6 COMPUTATION OF INTEREST.
(a) Interest on the Revolving Credit Note shall be calculated
on the basis of actual days elapsed, and computed on a year consisting of 360
days, subject to the provisions of Section 8.16 below. Further, for the purpose
of computing interest, all items of payment received by Lender in immediately
available funds shall be applied by Lender against the Obligations on the
Business Day such payment is received and, any other items of payment received
in a form other than immediately available funds shall be applied by Lender
(subject to final payment of all drafts and other items) against the Obligations
on the second Business Day after receipt. The determination of when a payment is
received by Lender will be made in accordance with Section 2.4. Each
determination of an interest rate by Lender pursuant to any provision of this
Agreement shall be presumptively conclusive and binding on Borrower in the
absence of manifest error, subject, however, to the provisions of Section 8.16
below.
(b) Notwithstanding anything to the contrary in the Revolving
Credit Note or herein contained, in the event that the Revolving Rate should
ever exceed the Maximum Rate, thereby causing the interest accruing on any of
the indebtedness evidenced by the Revolving Credit Note to be limited to such
Maximum Rate, then any subsequent reduction in the LIBOR Rate shall not reduce
the rate of interest charged hereunder below the Maximum Rate until the total
amount of interest accrued on such indebtedness equals the amount of interest
which would have accrued on such indebtedness if the Revolving Rate had been in
effect at all times in the period during which the rate charged thereon was
limited to the Maximum Rate.
2.7 DEFAULT RATE. At Lender's option and to the extent permitted by
applicable Law and this Agreement, all past due Obligations shall bear interest
from maturity (whether at stated maturity, by acceleration or otherwise) at the
Revolving Rate then in effect plus three percent (3.0%) ("Default Rate")
(provided, however, the Default Rate shall never exceed the Maximum Rate) until
paid, regardless of whether such payment is made before or after entry of a
judgment.
2.8 PRINCIPAL PAYMENTS. Any unpaid principal balance of the Revolving
Credit Note and any accrued and unpaid interest shall be due and payable on the
Commitment Termination Date.
2.9 MANDATORY PAYMENT OF REVOLVING CREDIT LOANS. Borrower shall
establish an account in the name of Lender with Lender or an affiliate of Lender
and shall deposit or cause to be deposited into such account all funds arising
from or related to the Collateral, including, without limitation, all proceeds
from the sale of Contracts to Contract Purchasers or otherwise, received by
Borrower on a daily basis, which funds shall be applied by Lender to the
Obligations of Borrower hereunder in the order and manner as Lender deems
appropriate. Funds deposited in such account shall be deemed to be the property
of Lender and Borrower shall have no right to make
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Exhibit 10.100
withdrawals from such account or otherwise have access to funds deposited into
such account.
If, at any time during the Commitment Period, (i) the unpaid principal
balance of the Revolving Credit Note shall exceed the lesser of (a) the
Borrowing Base, and (b) the Commitment, then, Borrower shall immediately repay,
without premium or penalty, the Revolving Credit Loans in an amount equal to
such excess, along with accrued unpaid interest on the amount so repaid to the
date of such repayment.
2.10 CANCELLATION OF COMMITMENT. The Commitment shall, at the election
of Lender, terminate upon the occurrence and continuance of an Event of Default;
provided, however, that the Commitment shall automatically terminate upon the
occurrence of an Event of Default pursuant to Section 6.4(a) through (f) and
Section 6.4 (i) (with respect to Section 6.4(a) through (f) inclusive). Borrower
may terminate the Commitment and this Agreement in its entirety by giving
written notice of such termination to Lender no less than twenty (20) days prior
to the designated termination date, and on the designated termination date, all
of the Obligations shall become due and payable in immediately available funds.
2.11 VOLUNTARY PRINCIPAL PREPAYMENTS. Prior to the Commitment
Termination Date, the Revolving Credit Loans may be prepaid in whole or in part
at any time. Subject to the conditions of this Agreement, amounts so prepaid may
be reborrowed hereunder, and this Agreement shall not be deemed to be terminated
or canceled prior to the expiration or termination of Lender's commitment to
lend hereunder solely because the Obligations may from time to time be paid in
full.
2.12 ORDER OF APPLICATION. At any time, including any time during which
a Default or Event of Default has occurred and is continuing, all payments and
prepayments of the Obligations, including proceeds from the exercise of any
Rights under the Loan Documents or proceeds of any of the Collateral shall be
applied to the Obligations in the order and manner as Lender deems appropriate.
2.13 USE OF PROCEEDS. Borrower shall use the proceeds of the Revolving
Credit Loans to finance the working capital needs of Borrower arising in the
ordinary course of business. All loan proceeds shall be used by Borrower only
for legal and proper purposes (duly authorized by its governing body) which are
consistent with all applicable Laws. The foregoing notwithstanding, Borrower
shall not use any proceeds of the Revolving Credit Loans directly or indirectly
to purchase ineligible securities, as defined by applicable regulations of the
Federal Reserve Board, underwritten by any affiliate of Bank One Corporation
during the underwriting period and for thirty (30) days thereafter.
2.14 UNUSED LINE FEE. Borrower shall pay to Lender an Unused Line Fee
equal to one-quarter of one percent (.25%) per annum on the average amount of
the unused portion of the Revolving Loan ("Unused Line Fee"). The Unused Line
Fee will be in addition to the interest charge provided for herein and will be
payable quarterly in
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Exhibit 10.100
arrears. The Unused Line Fee will be calculated on the basis of actual days
elapsed, but computed as if each year consisted of three hundred and sixty (360)
days.
2.15 COMMITMENT FEE. Borrower shall pay to Lender the Commitment Fee,
which Commitment Fee shall be in addition to the interest charge provided for
herein.
SECTION 3. CONDITIONS PRECEDENT.
3.1 INITIAL LOANS. Lender will not be obligated to make the initial
Revolving Credit Loan unless it has received all of the items described on
SCHEDULE 3.1 in form and substance satisfactory to Lender and its legal counsel
and unless Borrower has complied with all the conditions and terms described on
SCHEDULE 3.1 to the satisfaction of Lender and its legal counsel.
3.2 EACH LOAN. In addition, Lender will not be obligated to make any
Revolving Credit Loan unless (a) the Lender has received an Advance Request with
respect to such proposed Revolving Credit Loan together with the information and
documentation required by Section 5.3(c) of this Agreement and each statement or
certification made by Borrower in the Advance Request shall be true and correct
in all material respects on the Borrowing Date; (b) at the time of each
Revolving Credit Loan (i) the representations and warranties made in the Loan
Documents are true and correct in all material respects, and (ii) neither any
change in the financial condition or prospect of Borrower which could have a
Material Adverse Effect nor any Default or Event of Default shall have occurred
and shall be continuing; (c) the making of each Revolving Credit Loan is
permitted by Law; (d) all conditions related to any Revolving Credit Loan are
satisfactory to Lender and its counsel, and, if requested by Lender, Borrower
shall have delivered to Lender evidence substantiating any of the conditions
contained in this Agreement which are necessary to enable Borrower to qualify
for any Revolving Credit Loan; and (e) Lender shall have received such other
agreements, documents, instruments, information, approvals or opinions as Lender
may reasonably request.
The delivery of an Advance Request by Borrower and the acceptance by
Borrower of the proceeds of any Loan hereunder shall each be deemed to
constitute a representation and warranty by Borrower as to the matters specified
in this Section 3.2.
3.3 WAIVER OF CONDITIONS. Lender may, at its election, make any
Revolving Credit Loan without all conditions being satisfied, but this shall not
be deemed to be a waiver of the requirement that each such condition precedent
be satisfied as a prerequisite for any subsequent Revolving Credit Loan, unless
Lender specifically waives each such item in writing.
SECTION 4. REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants to
Lender as follows:
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Exhibit 10.100
4.1 ORGANIZATION AND POWERS. Borrower (i) is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, (ii) has all requisite power and authority to own its property and
assets and to carry on its business as now conducted and as proposed to be
conducted, (iii) is qualified to do business in every jurisdiction where such
qualification is necessary, (iv) has the power and authority to execute, deliver
and perform each Loan Document to which it is or will be a party, and (v) has
taken all action necessary to authorize the execution, delivery and performance
of the Loan Documents to which it is or will be a party.
4.2 VALIDITY AND BINDING NATURE. This Agreement has been duly executed
and delivered by Borrower and is, and each other Loan Document when executed and
delivered by Borrower will be, a legal, valid and binding obligation of such
Borrower enforceable against it in accordance with its terms (except as
enforcement thereof may be limited by bankruptcy, reorganization, insolvency,
moratorium or other laws affecting the enforcement of creditors' rights
generally and equitable principles relating to or affecting enforcement of
creditors' rights generally or relief of debtors generally).
4.3 COMPLIANCE WITH LAWS AND DOCUMENTS. Borrower is not, nor will the
execution, delivery and the performance of and compliance with the terms of the
Loan Documents cause Borrower to be, in violation of any Laws or its bylaws or
certificate of incorporation (as each may be amended). The execution, delivery
and the performance of and compliance with the terms of the Loan Documents are
not inconsistent with, and will not conflict with or result in any breach of, or
constitute a default under, or result in the creation or imposition of any Lien
(except pursuant to the Loan Documents) upon any of the property, assets or
revenues of Borrower pursuant to the terms of, any indenture, mortgage, lease,
deed of trust, agreement, contract instrument or Law to which Borrower is a
party or by which Borrower or any of Borrower's property, assets or revenue is
bound or to which it is subject.
4.4 PRIOR NAMES. Except as disclosed on SCHEDULE 4.4, in the last five
years, Borrower has not transacted business under any other corporate or trade
name, been a party to any merger, combination, or consolidation or acquired all
or substantially all of the assets of any Person.
4.5 RELATIONSHIP WITH LENDER. No Person who may be deemed to have
"control" of Borrower is an "executive officer," "director," or "principal
shareholder" of Lender or any correspondent of Lender, as such quoted terms are
defined in Section 215.2 of Regulation 0 of the Board of Governors of the
Federal Reserve System, as amended.
4.6 FINANCIAL STATEMENTS. The Current Financials were prepared in
accordance with GAAP and present fairly the financial condition and the result
of operations of Borrower as of, and for the portion of the fiscal year ending
on, the date or dates thereof. All material liabilities (direct or indirect,
fixed or contingent) of Borrower as of the date or dates of the Current
Financials are reflected therein or in the notes thereto. Between the date or
dates of the Current Financials and the date hereof,
13
Exhibit 10.100
there has been no material adverse change in the financial condition of
Borrower, nor has Borrower incurred any material liability (direct or indirect,
fixed or contingent).
4.7 REGISTRATIONS AND LICENSES. Borrower possesses adequate authority
and licenses including, without limitation licenses and registrations necessary
to Eligible Contracts and to continue to conduct its business as presently
conducted.
4.8 LITIGATION. Except for the Litigation described on SCHEDULE 4.8,
Borrower is not involved in, nor is Borrower aware of, any Litigation involving
Borrower involving amounts in excess of $25,000, nor are there any outstanding
or unpaid judgments against Borrower. None of the Litigation described on
SCHEDULE 4.8 could, collectively or individually, have a Material Adverse Effect
if determined adversely against Borrower.
4.9 TAXES. All tax returns and reports of Borrower required to be
filed have been filed, and all Taxes imposed upon Borrower which are due and
payable have been paid, other than Taxes being contested in good faith for which
the criteria for Permitted Liens have been satisfied as set forth on SCHEDULE
4.13.
4.10 GOVERNMENT REGULATION. Neither Borrower nor any transaction
contemplated hereunder is subject to regulation under the Public Utility Holding
Company Act of 1935, the Federal Power Act, the Investment Company Act of 1940,
the Interstate Commerce Act (as any of the preceding acts have been amended),
any regulations promulgated by the Office of Foreign Assets Control as codified
in Chapter V of 31 C.F.R., or any other Law (other than Regulation G, T, U or X
of the Board of Governors of the Federal Reserve System) which regulates the
incurrence of Debt.
4.11 EMPLOYEE BENEFIT PLANS. Borrower does not currently sponsor or
contribute to, nor has any contract or other obligation to contribute to (nor
has Borrower in the preceding sixty (60) calendar months sponsored or
contributed to, or contracted to or become otherwise obligated to contribute to)
any Plan or any Multiemployer Plan, except as set forth on SCHEDULE 4.11.
4.12 PURPOSE OF LOAN. The proceeds of the Advances will be used only
for the purposes set forth in Section 2.13 and shall not be used (a) to purchase
or carry any "Margin Stock" (within the meaning of Regulation G or U of the
Board of Governors of the Federal Reserve System), or (b) for any purpose in
violation of Regulations G, T, U or X of said Board of Governors.
4.13 PROPERTIES; LIENS; DEBT. Borrower has good and marketable title to
all of its property. Except for Liens permitted by Lender to be listed on
SCHEDULE 4.13 and the Liens in favor of Lender (collectively, the "Permitted
Liens"), there is no Lien on any of Borrower's property or income. Borrower has
no Debt other than that listed on SCHEDULE 5.2(a).
14
Exhibit 10.100
4.14 MATERIAL AGREEMENTS. Borrower is not, nor will the execution,
delivery and performance of and compliance with the terms of the Loan Documents
cause Borrower to be, in default (nor has any potential default occurred) under
any material agreement, document or instrument other than such defaults or
potential defaults which could not, individually or collectively, cause a
Material Adverse Effect.
4.15 NO CONSENTS. Except as set forth on SCHEDULE 4.15, no order,
consent, approval, license, permit, waiver, exemption, authorization of or
validation of, or filing, recording or registration with (except as heretofore
have been obtained or made), or exemption by, any Person is required to
authorize, or is required in connection with, the execution, delivery,
performance, legality, validity, binding effect, or enforceability of the Loan
Documents.
4.16 SUBSIDIARIES AND AFFILIATES. Borrower has no Subsidiaries or
Affiliates other than as disclosed on SCHEDULE 4.16 below.
4.17 CAPITALIZATION AND CONTROL. The capitalization of Borrower as set
forth on SCHEDULE 4.17 is true, correct and complete. All of the issued and
outstanding stock of Borrower has been duly and validly issued in accordance
with Borrower's organizational documents and all applicable requirements of law
and is fully paid and nonassessable. There are no options, warrants, rights,
calls, commitments, plans, contracts or other agreements granted or issued
regarding the stock of Borrower and none are authorized, except as set forth in
Schedule 4.17.
4.18 GENERAL. To the best of Borrower's knowledge, there are no facts
or conditions relating to the Loan Documents, any of the Collateral or the
financial condition and business of Borrower which could, individually or
collectively, cause a Material Adverse Effect and which have not been revealed
in writing to Lender. All writings heretofore or hereafter exhibited or
delivered to Lender by or on behalf of Borrower are and will be genuine and in
all respects what they purport and appear to be. No information furnished to
Lender by or on behalf of Borrower contains any material misstatement of fact or
omits to state any fact necessary to make the statements contained herein or
therein, in light of the circumstances in which they were made, not misleading
which would result in a Material Adverse Effect.
4.19 CONTRACT PURCHASE AGREEMENTS. EXHIBIT D hereto represents all of
Borrower's Contract Purchase Agreements; such agreements are in full force and
effect; and, Borrower is not in default under any such agreement.
4.20 SUBSEQUENT AFFIRMATIONS. Affirmations of the foregoing
Representations and Warranties subsequent to the Closing Date shall be based on
information delivered to Lender by Borrower as of the Closing Date (or
subsequent information delivered by Borrower in compliance with Section 5.1(j),
if any,) and Financial Statements to be supplied by Borrower subsequent to the
Closing Date in compliance with Sections 5.3(a), 5.3(b) and 5.3(c).
15
Exhibit 10.100
SECTION 5. COVENANTS.
5.1 AFFIRMATIVE COVENANTS. Borrower covenants and agrees with Lender,
so long as this Agreement shall remain in effect and the principal of or
interest on the Revolving Credit Note, or any other Obligation, shall be unpaid,
as follows:
5.1(a) COMPLIANCE WITH LAW; MAINTENANCE OF PROPERTIES. Borrower
shall do or cause to be done all things necessary (i) to preserve and keep in
full force and effect at all times its existence and its rights, licenses and
franchises, (ii) to continue to conduct its business substantially as now
proposed to be conducted, (iii) to comply with all applicable Laws, the
violation of which might have a Material Adverse Effect on the operations of
Borrower or the Collateral, and (iv) to preserve all property in use or useful
in the conduct of its business and keep the same in good repair, working order
and condition and from time to time make, or cause to be made, all necessary and
proper repairs, renewals and replacements, betterment and improvements thereto
so its business carried on in connection therewith may be properly and
advantageously conducted at all times. Failure to comply with this provision may
be cured by Borrower within twenty (20) days of such failure; and upon such
timely cure, Borrower shall be in compliance with this provision.
5.1(b) INSURANCE. Borrower shall maintain comprehensive general
liability and public liability insurance and such other types of insurance
reasonably requested by Lender, all such insurance to be maintained with
financially sound and reputable insurance companies, against such casualties,
risks and contingencies, and in such types and amounts, as are consistent with
customary practices and standards of companies engaged in a similar business.
All insurance insuring the Collateral shall name Lender as a loss payee.
5.1(c) INSPECTION. Borrower shall permit any representative of the
Lender to visit and inspect any of its property, including the Collateral, to
examine its books and records and to make copies and take extracts therefrom,
and to discuss its affairs, finances and accounts with its officers. If no Event
of Default has occurred and is continuing, Lender shall give Borrower reasonable
notice of such examination and such examination shall occur during regular
business hours.
5.1(d) FURTHER ASSURANCES. Borrower shall execute any and all
further documents and take all further actions which may be required under
applicable law, or which the Lender may request, to grant, preserve, protect and
perfect the first priority Lien on the Collateral created by the Security
Documents (subject only to Liens permitted by the Loan Documents), including
without limitation, those actions required to perfect Liens on and assignment of
any interest of Borrower in any Contract in accordance with the laws of the
jurisdiction governing such Liens and the assignments.
5.1(e) INDEMNITY. Borrower shall indemnify Lender and its
officers, directors, employees, representatives, agents, attorneys and
affiliates (each, an
16
Exhibit 10.100
"Indemnified Party") from, hold each of them harmless against, promptly upon
demand pay or reimburse each of them with respect to any and all actions, suits,
proceedings (including any investigations, litigation or inquiries), claims,
demands, causes of action, costs, losses, liabilities, damages or expenses of
any kind or nature whatsoever (collectively, the "Indemnity Matters") other than
those proximately resulting from an Indemnified Party's negligence or willful
misconduct which may be incurred by or asserted against or involve any of them
(whether or not any of them is designated a party thereto) as a result of,
arising out of or in any way related to (i) any actual or proposed use by
Borrower of the proceeds of any of the Revolving Credit Loans, (ii) the breach
of any representation or warranty set forth in any Loan Document, or (iii) any
other aspect of this Agreement and the other Loan Documents, including, without
limitation, the reasonable fees and disbursements of counsel (including
allocated costs of internal counsel), and all other expenses incurred in
connection with investigating, defending or preparing to defend any such
Indemnity Matter. Borrower shall be obligated to pay or reimburse each
Indemnified Party for all out-of-pocket costs and expenses (including, without
limitation, reasonable attorneys' fees and expenses) incurred by such
Indemnified Party in connection with any Indemnity Matter at the time such costs
and expenses are incurred and such Indemnified Party has given Borrower written
notice thereof. Borrower's Obligations under this Section are subject to Section
8.14 hereof. In the event that any claim, demand, investigation, litigation or
inquiry (a "Claim") is brought against any Indemnified Party, the Indemnified
Party agrees to give written notice to Borrower with respect to same, together
with a copy of such Claim, and so long as no Event of Default shall have
occurred and be continuing, Borrower shall have the right in good faith and by
appropriate proceedings to defend any Indemnity Matter and to employ counsel
acceptable to the Indemnified Party to conduct such defense (at Borrower's sole
expense) so long as such defense shall not involve any danger of the
foreclosure, sale, forfeiture or loss of, or imposition of any Lien, other than
a Permitted Lien, on any part of the Collateral, or subject any Indemnified
Party to criminal liability. Should Borrower elect to engage its own counsel
acceptable to the Indemnified Party and Lender, the Indemnified Party and Lender
may continue to participate in the defense of any such Indemnified Matter and
will retain the right to settle any such matter on terms and conditions
satisfactory to Lender, Indemnified Party and Borrower. All such settlements
shall be paid by and remain the sole responsibility of Borrower. In the event
Borrower does not accept the defense of the Indemnity Matter as provided above,
Indemnified Party shall have the full right to defend against such Claim, in its
sole discretion, and pursue its rights hereunder.
5.1(f) BOOKS AND RECORDS. Borrower shall keep, in accordance with
GAAP, proper and complete books, records and accounts.
5.1(g) TAXES. Borrower shall promptly pay when due any and all
Taxes, except Taxes for which the criteria for Permitted Liens have been
satisfied.
5.1(h) PAYMENT OF OBLIGATIONS. Borrower shall promptly pay all of
its Debt as it becomes due except to the extent that any such Debt is being
contested in good faith and by appropriate and lawful proceedings diligently
conducted and for which
17
Exhibit 10.100
reserves or other provisions (if any) required by GAAP shall have been made;
provided, however, that except for payments to Borrower's mortgage warehouse
lenders, Borrower shall not, directly or indirectly, make (i) any prepayment of
principal of or interest on any Debt other than the Obligations, or (ii) any
payment of principal of or interest on any Debt subordinated to the Obligations
(such subordination to be in form and substance satisfactory to Lender) without
the prior written consent of Lender.
5.1(i) EXPENSES OF LENDER. Whether or not the transactions
contemplated by this Agreement shall be consummated, Borrower shall pay on
demand all out-of-pocket expenses (including, without limitation, the reasonable
fees and expenses of counsel for Lender) in connection with the negotiation,
preparation, execution, filing, recording, refiling, re-recording, modification,
release, supplement and waiver of the Loan Documents and the making, servicing
and collection of the Obligations including, without limitation, the Obligations
under Section 7.4.
5.1(j) SUPPLEMENTED SCHEDULES. Borrower shall as soon as possible
and in any event within fifteen (15) days after the occurrence thereof,
supplement in writing and deliver to Lender revisions of the Schedules annexed
to this Agreement to the extent necessary to disclose new or changed facts or
circumstances after the Closing Date so as to cause the representations and
warranties set forth herein to remain accurate and not misleading; provided,
that, subsequent disclosures shall not constitute a cure or waiver of any
Default or Event of Default resulting from the matters disclosed.
5.1(k) LOAN GUIDELINES. The Contracts of Borrower shall comply at
all times with Law, with the Loan Guidelines and the terms, conditions and
disclosures in each lending relationship by and between Borrower and its
customer.
5.1(l) COLLATERAL DEPOSIT ACCOUNTS. In addition to the account to
be established with Lender as required by section 2.9 of this Agreement,
Borrower shall establish as soon as possible (and no later than within ninety
(90) days of the Closing Date) with Lender or an affiliate of Lender all
accounts used by Borrower, in any way related to the Contracts if Lender can
provide the same or similar services and features for such accounts as are
presently being provided to Borrower.
5.2 NEGATIVE COVENANTS. Borrower covenants and agrees with Lender,
so long as this Agreement shall remain in effect and the principal of or
interest on the Revolving Credit Note, or any other Obligation, shall be unpaid,
as follows:
5.2(a) DEBT. Without the prior written consent of Lender, Borrower
shall not, directly or indirectly, create, incur or suffer to exist any direct,
indirect, fixed or contingent liability or any Debt, except for (i) the
Obligations, (ii) the Debt described on SCHEDULE 5.2(a), (iii) obligations to
pay Taxes, (iv) accounts payable in the ordinary course of business, (v)
salaries and wages, (vi) accrued expenses, deferred credits and loss
contingencies which are properly classified as liabilities or indebtedness under
18
Exhibit 10.100
GAAP, and (vii) Debt owing to any Person that is subordinated to the Obligations
on terms and conditions satisfactory to Lender.
5.2(b) LIENS. Without the prior written consent of Lender,
Borrower shall not, directly or indirectly, (i) create, incur or suffer or
permit to be created or incurred or to exist any Lien upon any of its assets
except for (a) the Liens in favor of Lender, and (b) the Liens described on
SCHEDULE 4.13, if any, or (ii) enter into or permit to exist any arrangement or
agreement, other than the Loan Documents, which directly or indirectly prohibits
Borrower from creating or incurring any Lien on any of its assets.
5.2(c) ACQUISITIONS, MERGERS AND DISSOLUTIONS. Without the prior
written consent of Lender, Borrower shall not, directly or indirectly (i)
acquire all or any substantial portion of the assets or stock of, or interest
in, any Person, (ii) merge or consolidate with any Person, (iii) liquidate, wind
up, or dissolve itself (or suffer any liquidation or dissolution) or (iv)
otherwise undergo a change in control of more than twenty-five percent (25%) of
the ownership of Borrower.
5.2(d) LOANS, ADVANCES AND INVESTMENTS. Without the prior written
consent of Lender, Borrower shall not directly or indirectly, make any loan,
advance or extension of credit, or capital contribution to, make any investments
in, or purchase or commit to purchase any stock or other securities or evidences
of contractual obligations of, or interests in, any Person, except for (i)
investments in obligations of the United States of America and agencies thereof
and obligations guaranteed by the United States of America maturing within one
year from the date of acquisition, and (ii) certificates of deposit issued by
commercial banks organized under the Laws of the United States of America or any
state thereof and having a combined capital, surplus and undivided profits of
not less than $500,000, or completely insured by the Federal Deposit Insurance
Corporation.
5.2(e) EMPLOYEE BENEFIT PLANS. Borrower shall not, directly or
indirectly, sponsor or contribute to, or create or suffer to exist any
contractual or other obligation to contribute to, any Plan or Multiemployer
Plan, other than those set forth on Schedule 4.11.
5.2(f) DIVIDENDS. Borrower shall not pay any dividends or
distributions to any Person if a Default or Event of Default has occurred or if
such payment would result in the occurrence of a Default or Event of Default.
5.2(g) ISSUANCE OF SECURITIES. Borrower shall not, directly or
indirectly, issue, sell or otherwise dispose of (i) any of its shares of capital
stock or other investment securities of any class such as to result in a change
in the controlling interest in Borrower, (ii) any securities convertible into or
exchangeable for any such shares, or (iii) any carrying Rights, warrants,
options, or other rights to subscribe for or purchase any such shares.
19
Exhibit 10.100
5.2(h) TRANSACTIONS WITH AFFILIATES OR SUBSIDIARIES. Borrower
shall not, directly or indirectly, enter into any transaction (including, but
not limited to, the sale or exchange of property or the rendering of service)
with any of its Affiliates or Subsidiaries, other than in the ordinary course of
business of Borrower and upon fair and reasonable terms no less favorable than
Borrower could obtain or could become entitled to in an arm's-length transaction
with a Person which was not an Affiliate or Subsidiary. All existing
transactions of Borrower with any Affiliate or Subsidiary are described on
SCHEDULE 5.2(h) hereto.
5.2(i) SALE OF ASSETS. Without Lender's prior written consent,
Borrower shall not, directly or indirectly, sell, lease or otherwise dispose of
any assets.
5.2(j) CHANGE IN MANAGEMENT OF BORROWER. Without Lender's prior
written consent, Borrower shall not initiate a change in the president, chief
executive officer or chief financial officer until replacement acceptable to
Lender has been engaged by Borrower. If such a change occurs which is not
initiated by Borrower, Borrower shall obtain replacement management acceptable
to Lender within sixty (60) days. During such sixty (60) day period, in addition
to and supplemental to all other Rights of Lender under this Agreement, Lender
may install an auditor(s) in any of the business locations of Borrower to
ascertain Borrower's compliance with this Agreement.
5.2(k) DEBT TO TANGIBLE NET WORTH. Borrower shall not permit its
ratio of (i) Debt minus Debt subordinated to the Obligations on terms and
conditions satisfactory to Lender, to (ii) Tangible Net Worth to exceed 2.0 to
1.0, as of the last day of each calendar quarter.
5.2(l) TANGIBLE NET WORTH. Borrower shall not permit its Tangible
Net Worth to be less than $25,000,000, as of the Closing Date and the last day
of each calendar month.
5.2(m) CONTRACT REDOCUMENTATION AND MODIFICATION. Borrower shall
not redocument or otherwise modify any Contract without the prior written
consent of Lender.
5.2(n) COMPLIANCE WITH LAWS AND DOCUMENTS. Borrower shall not,
directly or indirectly, violate the provisions of any Laws, its articles of
incorporation, bylaws, other governance documents or any agreements.
5.2(o) NEW BUSINESSES. Borrower shall not, directly or indirectly,
engage in any business other than that in which it is presently engaged without
the prior written consent of Lender.
5.2(p) FISCAL YEAR AND ACCOUNTING METHODS. Borrower shall not
change its fiscal year, which currently ends each December 31, or method of
accounting, other than immaterial changes in methods to which its independent
certified public accountants concur without the prior written consent of Lender.
20
Exhibit 10.100
5.2(q) USE OF NAME CONFIDENTIALITY. Borrower shall not use
Lender's name or trademark in connection with the operation of Borrower's
business, including, but not limited to, any advertising undertaken by Borrower,
and Borrower shall use all reasonable efforts to keep confidential the terms and
conditions of the Loan Documents except as required to satisfy disclosure
requirements of the Securities Exchange Commission or other supervising
governmental agency.
5.2(r) BUSINESS LOCATIONS. All present business locations of
Borrower are set forth on SCHEDULE 5.2(r), including, without limitation,
Borrower's principal place of business. Without the prior written consent of
Lender, Borrower shall not conduct its business operations or store or otherwise
locate any of the Collateral at any other location except as set forth on
SCHEDULE 5.2(r). Borrower shall establish no new Business location without
giving written notice to Lender thirty (30) days prior to such establishment and
executing and delivering to Lender any documents considered necessary by Lender,
in Lender's sole discretion, to perfect or continue perfection of its Liens on
the Collateral.
5.2(s) DELIVERY OF DEALER DRAFTS. Borrower shall fund no Dealer
Draft until the Dealer in a subject transaction has complied with the Dealer
Agreement.
5.2(t) MODIFICATION OF DEALER AGREEMENT. Without the prior written
consent of Lender, Borrower shall not amend, modify, supplement or otherwise
change the Dealer Agreement.
5.3 REPORTING REQUIREMENTS. Borrower shall furnish to Lender such
information as requested by Lender. Additionally, Borrower shall cause the
following to be furnished to Lender:
5.3(a) As soon as available, but no later than one hundred five
(105) days after the last day of each fiscal year of Borrower, unqualified
audited Financial Statements showing the financial condition and result of
operations of each Borrower as of, and for the year ended on, such last day,
accompanied by (i) the opinion of a firm of independent certified public
accountants acceptable to Lender, based on an audit using generally accepted
auditing standards, that such Financial Statements were prepared in accordance
with GAAP and present fairly the financial condition and result of operations of
Borrower, and (ii) a Financial Report Certificate with respect to such Financial
Statements.
5.3(b) As soon as available, but no later than thirty (30) days
after the last day of each calendar month (i) unaudited Financial Statements
(balance sheet and income statement only) showing the financial condition and
results of operations of Borrower as of, and for the period from the beginning
of the current fiscal year, to such last day, for the same time period (ii) a
Financial Report Certificate with respect to such Financial Statements.
21
Exhibit 10.100
5.3(c) As soon as available, but no later than Tuesday of each
week, as of Friday of the respective preceding week and upon submission of an
Advance Request a Borrowing Base Report. Each Borrowing Base Report prepared by
Borrower shall be certified as true, correct and complete by the president,
chief executive officer or chief financial officer of Borrower.
5.3(d) Notice, promptly after Borrower knows or has good faith
reason to believe, of (i) the existence and status of any Litigation with
respect to Borrower or any Guarantor which could have a Material Adverse Effect,
(ii) any change in any material fact or circumstance represented or warranted in
any Loan Document, and/or (iii) a Default or Event of Default, specifying the
nature thereof and what action Borrower has taken, is taking, or proposes to
take with respect thereto.
5.3(e) Promptly, but within five (5) Business Days upon request
therefor by Lender, such information (not otherwise required to be furnished
under the Loan Documents) respecting the business affairs, assets and
liabilities of Borrower or any Person guaranteeing or providing Collateral to
secure all or any part of the Obligations and such opinions, certifications and
documents, in addition to those mentioned in this Agreement, as Lender may
reasonably request.
5.4 USE OF REPORTS. Borrower acknowledges and agrees that although
Lender may rely on the unaudited financial statements and reports delivered to
Lender pursuant to Section 5.3 to determine whether Borrower is in compliance
with the financial covenants set forth in Section 5.2, Lender may make any
adjustment consistent with GAAP to such reports and statements, as it
determines, in its sole discretion, which is necessary to more accurately
reflect the financial condition of Borrower or to more accurately reflect the
value of the Collateral. Lender shall advise Borrower of any material
adjustments made pursuant to this Section 5.4. Any dispute between Borrower and
Lender as to the interpretation and/or application of GAAP shall be resolved by
obtaining the opinion of a certified public accountant and acceptable to Lender,
at the expense of Borrower.
5.5 AUDITS. Borrower shall permit Lender or its designated
representative to enter upon Borrower's premises at any of Borrower's business
locations to conduct periodic audits of Borrower's books, accounts, inventory
and operations. Such audits shall be conducted during each calendar quarter
during the term of this Agreement; provided, however, the frequency of such
audits may be increased or decreased within the sole discretion of Lender. If no
Event of Default has occurred and is continuing, Lender shall provide reasonable
notice to Borrower of such audits and shall conduct such audits during regular
business hours.
SECTION 6. EVENTS OF DEFAULT. The term "Event of Default" means the occurrence
of any one or more of the following events:
22
Exhibit 10.100
6.1 PAYMENT OF OBLIGATIONS. The failure or refusal of Borrower to pay
any portion of the Obligations as the same becomes due in accordance with the
terms of the Loan Documents.
6.2 OTHER COVENANTS. The failure or refusal of Borrower to punctually
and properly perform, observe and comply with any covenant, agreement or
condition contained in this Agreement.
6.3 LOAN DOCUMENTS AND SECURITY DOCUMENTS. An Event of Default shall
occur and be continuing under any Security Document or other Loan Document.
6.4 BANKRUPTCY. (a) Borrower shall commence a voluntary case
concerning itself under Title 11 of the United States Code entitled "Bankruptcy"
as now or hereafter in effect, or any successor thereto, (b) an involuntary case
is commenced against Borrower and the petition is not controverted within ten
(10) days, or is not dismissed within thirty (30) days, after commencement of
the case, (c) a custodian is appointed for, or takes charge of, all or any
substantial part of the property of Borrower, (d) Borrower commences any other
proceeding under any reorganization, arrangement, adjustment of debt, relief of
debtors, dissolution, insolvency or liquidation or similar law of any
jurisdiction whether now or hereafter in effect relating to Borrower or there is
commenced against Borrower any such proceeding which remains undismissed for a
period of thirty (30) days, (e) Borrower is adjudicated insolvent or bankrupt,
(f) Borrower makes a general assignment for the benefit of creditors, (g)
Borrower shall fail to pay, or shall state that it is unable to pay, or shall be
unable to pay, its debts generally as they become due, (h) Borrower shall call a
meeting of its creditors with a view to arranging a composition or adjustment of
its debts, or (i) Borrower shall by any act or failure to act indicate its
consent to, approval of or acquiescence in any of the foregoing.
6.5 ATTACHMENT. The failure to have discharged, within a period of
thirty (30) days after the commencement thereof, any attachment, sequestration
or similar proceeding against any Material Assets of Borrower.
6.7 PAYMENT OF JUDGMENTS. Borrower shall fail to pay, bond, secure or
obtain a stay of enforcement from a court of competent jurisdiction of or with
respect to any money judgment against it or its assets at least ten (10) days
prior to the date on which Borrower's assets may be sold lawfully to satisfy
such judgment.
6.8 DEFAULT UNDER OTHER DEBT. Borrower shall default in the due and
punctual payment of the principal of or the interest on any Debt, secured or
unsecured, including, without limitation, any Debt or other obligation to any
affiliate or subsidiary of Lender, or in the due performance or observance of
any covenant or condition of any indenture or other material agreement executed
in connection therewith, and such default shall have continued beyond any period
of grace provided with respect thereto.
23
Exhibit 10.100
6.9 MATERIAL ADVERSE EFFECT. The occurrence of any event or events
which shall have or cause a Material Adverse Effect.
6.10 IMPAIRMENT OF COLLATERAL OR ABILITY TO PAY. The discovery by
Lender of reliable and accurate information that the prospect of payment or
performance of the Obligations is reasonably likely to be materially impaired,
or that the value of the Collateral has or will be materially decreased.
6.11 MISREPRESENTATION. Any statement, representation, or warranty in
the Loan Documents or in any writing ever delivered by Borrower or on behalf of
Borrower to Lender pursuant to the Loan Documents is false, misleading or
erroneous in any material respect when made or when deemed to be repeated.
SECTION 7. RIGHTS AND REMEDIES.
7.1 REMEDIES. Upon and after the occurrence of an Event of Default,
Lender may, at its election, do any one or more of the following without notice
of any kind, including, without limitation, notice of acceleration or of
intention to accelerate, presentment and demand or protest, all of which are
hereby expressly waived by Borrower: (a) declare the entire unpaid balance of
the Obligations, or any part thereof, immediately due and payable, whereupon it
shall be due and payable (provided that, upon the occurrence of an Event of
Default under Section 6.4 (a)-(f) inclusive, the entire Obligations shall
automatically become due and payable without notice or other action of any kind
whatsoever); (b) terminate its commitment to lend hereunder; (c) exercise the
Rights of offset or banker's lien against the interest of Borrower in and to
every account and other property of Borrower which are in the possession of
Lender to the extent of the full amount of the Obligations; (d) foreclose any or
all Liens held by Lender or otherwise realize upon any and all of the Rights
Lender may have in and to the Collateral, or any part thereof; and (e) exercise
any and all other legal or equitable Rights afforded by the Loan Documents or
under Law. Notwithstanding the foregoing, Lender may, but shall be under no
obligation, to use reasonable efforts to notify Borrower of any of the
foregoing; provided, however, the parties hereto expressly agree that the
failure of Lender to provide notice shall not in any way affect or impair any
action taken by Lender, it being understood that any absolute obligation of
notice is hereby waived by Borrower to the fullest extent permitted by Law.
7.2 PERFORMANCE BY LENDER. If any covenant, duty or agreement of
Borrower is not performed in accordance with the terms of the Loan Documents,
Lender may, at its option, perform or attempt to perform, such covenant, duty or
agreement on behalf of Borrower. In such event, any amount expended by Lender in
such performance or attempted performance shall be payable by Borrower to Lender
on demand, shall become part of the Obligations and shall bear interest at the
Default Rate from the date of such expenditure by Lender until paid.
Notwithstanding the foregoing, it is expressly understood that Lender does not
assume and shall never have, except by express
24
Exhibit 10.100
written consent of Lender, any liability or responsibility for the performance
of any covenant, duty or agreement of Borrower.
7.3 DELEGATION OF DUTIES AND RIGHTS. Lender may perform any of its
duties or exercise any of its Rights under the Loan Documents by or through its
officers, directors, employees, attorneys, agents or other representatives.
7.4 EXPENDITURES BY LENDER. Borrower shall indemnify Lender for all
court costs, reasonable attorneys' fees, other costs of collection and other
sums spent by Lender pursuant to the exercise of any Right (including, without
limitation, any effort to collect or enforce the Revolving Credit Note) provided
herein shall be payable to Lender on demand, shall become part of the
Obligations and shall bear interest at the Default Rate from the date spent
until the date repaid. This Agreement, together with all other Loan Documents,
constitutes a contract of indebtedness pursuant to O.R.C. SS.1301.21.
SECTION 8. MISCELLANEOUS.
8.1 NOTICES. All notices, requests and other communications to be
given hereunder shall be in writing and shall be given to such party at its
address or fax number set forth on SCHEDULE 8.1 hereto or such other address or
fax number as such party may hereafter specify by notice to Lender and Borrower.
Each such notice, request or other communication shall be effective (i) if given
by fax during the business hours of the party receiving notice, when transmitted
to the fax number specified in this Section and a confirmation of receipt (which
may be telephonic) is given by the recipient, (ii) if given by mail, on the
third day after such communication is deposited in the mails with first class
postage prepaid, addressed as aforesaid or (iii) if given by any other means
(including, without limitation, by air courier), when delivered at the address
specified in this Section; provided, that, notices under this (iii) to Borrower
or to Lender shall not be effective until received. All notices shall also be
given, simultaneously and in like manner, to such party's legal counsel at its
address or fax number set forth on SCHEDULE 8.1 hereto or such other address or
fax number as such party may hereafter specify by notice to the other parties.
8.2 AMENDMENTS, ETC. No amendment or waiver of any provision of this
Agreement or any other Loan Document, nor consent to any departure by Borrower
therefrom, shall in any event be effective unless the same shall be in writing
and signed by Lender, and then such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given.
8.3 NO WAIVER; REMEDIES CUMULATIVE. No failure or delay on the part of
Lender in exercising any Right or remedy hereunder and no course of dealing
between Borrower and Lender shall operate as a waiver thereof, nor shall any
single or partial exercise of any Right or remedy hereunder preclude any other
or further exercise thereof or the exercise of any other Right or remedy
hereunder. The Rights and remedies herein expressly provided are cumulative and
not exclusive of any Rights or remedies which Lender would otherwise have.
25
Exhibit 10.100
8.4 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of Borrower and Lender and their respective successors and
permitted assigns. Borrower may not assign or transfer any of its rights or
obligations hereunder without the written consent of Lender and any purported
assignment in violation of the foregoing shall be null and void.
8.5 NUMBER AND GENDER OF WORDS. Whenever in any Loan Document the
singular number is used, the same shall include the plural where appropriate,
and vice versa; and words of any gender in any Loan Document shall include each
other gender where appropriate. The words "herein," "hereof," and "hereunder,"
and other words of similar import refer to the relevant Loan Document as a whole
and not to any particular part or subdivision thereof.
8.6 HEADINGS. The headings, captions, and arrangements used in any of
the Loan Documents are, unless specified otherwise, for convenience only and
shall not be deemed to limit, amplify, or modify the terms of the Loan
Documents, nor affect the meaning thereof.
8.7 EXHIBITS AND SCHEDULES. If any EXHIBIT or SCHEDULE, which is to be
executed and delivered, contains blanks, the same shall be completed correctly
and in accordance with the terms and provisions contained and as contemplated
herein prior to, at the time of, or after the execution and delivery thereof.
Each of the EXHIBITS and SCHEDULES are incorporated herein by this reference.
8.8 FORM AND NUMBER OF DOCUMENTS. Each agreement, document,
instrument, or other writing to be furnished to Lender under any provision of
this Agreement must be in form and substance and in such number of counterparts
as may be satisfactory to Lender and its counsel.
8.9 CONFLICTS. Except as otherwise provided in this Agreement and
except as otherwise provided in the other Loan Documents by specific reference
to the applicable provisions of this Agreement, if any provision contained in
this Agreement is in conflict with or is inconsistent with any provision in the
other Loan Documents, the provision contained in this Agreement shall govern and
control. The foregoing notwithstanding, as to the subject matter of the Loan
Document entitled Agreement With Respect to Prevention and Resolution of
Disputes, the provisions of that Loan Document shall govern and control.
8.10 WAIVERS BY BORROWER. TO THE FULLEST EXTENT PERMITTED BY LAW,
EXCEPT AS OTHERWISE PROVIDED FOR IN THIS AGREEMENT, BORROWER WAIVES (A)
PRESENTMENT, DEMAND AND PROTEST AND NOTICE OF PRESENTMENT, NOTICE OF INTENT TO
ACCELERATE THE MATURITY OF THE OBLIGATIONS AND NOTICE OF SUCH ACCELERATION,
PROTEST, DEFAULT, NON-PAYMENT, MATURITY, RELEASE, COMPROMISE, SETTLEMENT,
EXTENSION, OR RENEWAL; (B) ALL RIGHTS TO NOTICE OF A HEARING PRIOR TO THE
LENDER'S TAKING POSSESSION OR CONTROL OF, OR THE LENDER'S REPLEVY, ATTACHMENT OR
LEVY UPON, THE COLLATERAL OR ANY BOND OR
26
Exhibit 10.100
SECURITY WHICH MIGHT BE REQUIRED BY ANY COURT PRIOR TO ALLOWING THE LENDER TO
EXERCISE ANY OF LENDER'S REMEDIES; AND (C) THE BENEFIT OF ALL VALUATION,
APPRAISEMENT AND EXEMPTION LAWS. BORROWER ACKNOWLEDGES THAT IT HAS BEEN ADVISED
BY COUNSEL WITH RESPECT TO THIS AGREEMENT AND THE TRANSACTIONS EVIDENCED BY THIS
AGREEMENT.
8.11 WAIVER OF JURY. LENDER AND BORROWER HEREBY VOLUNTARILY,
IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN
RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE, BETWEEN
LENDER AND BORROWER ARISING OUT OF, IN CONNECTION WITH, RELATED TO, OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN BORROWER AND LENDER IN
CONNECTION WITH THE LOAN DOCUMENTS, THIS AGREEMENT, OR ANY OTHER AGREEMENT OR
DOCUMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS
RELATED HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT TO LENDER TO ENTER INTO
THE FINANCING TRANSACTION. IT SHALL NOT IN ANY WAY AFFECT, WAIVE, LIMIT, AMEND
OR MODIFY LENDER'S ABILITY TO PURSUE ITS REMEDIES, INCLUDING, BUT NOT LIMITED
TO, ANY CONFESSION OR JUDGMENT OR COGNOVIT PROVISION CONTAINED IN THE LOAN
DOCUMENTS OR ANY OTHER DOCUMENT RELATED HERETO.
8.12 CHANGES IN GAAP. All accounting and financial terms used in any of
the Loan Documents and the compliance with each covenant contained in the Loan
Documents which relates to financial matters shall be determined in accordance
with GAAP, except to the extent that a deviation therefrom is expressly stated
in such Loan Documents. Should a change in GAAP require a change in any method
of accounting, then such change shall not result in an Event of Default if, at
the time of such change, such Event of Default had not occurred and was not then
continuing, based upon the former methods of accounting used by or on behalf of
Borrower; provided that, after any such change in accounting methods, the
Financial Statements required to be delivered to Lender pursuant to the terms
hereof shall be prepared in compliance with such new method or methods of
accounting but accompanied by such information, in form and detail satisfactory
to Lender, that will allow Lender to readily determine the effect of such
changes in accounting methods on such Financial Statements, and, for the purpose
of determining whether an Event of Default has occurred, Lender shall look
solely to such Financial Statements as adjusted to reflect compliance with such
former method or methods of accounting.
8.13 EXCEPTIONS TO COVENANTS. Borrower shall not take any action or
fail to take any action which is permitted as an exception to any of the
covenants contained in any of the Loan Documents if such action or omission
would result in the breach of any other covenant contained in any of the Loan
Documents.
8.14 SURVIVAL. All covenants, agreements, undertakings,
representations, and warranties made in any of the Loan Documents shall survive
all closings under the Loan Documents and, except as otherwise indicated, shall
not be affected by any investigation made by any party. Borrower's obligations
under Sections 5.1(e) and 5.1(i) hereof shall remain operative and in full force
and effect regardless of the
27
Exhibit 10.100
termination of this Agreement, the repayment of the Revolving Credit Note, or
the existence of any investigation made on behalf of the Lender regarding the
representations and warranties made by Borrower in connection with the Loan
Documents. If and to the extent that the obligations of Borrower under Sections
5.1(E) and 5.1(I) are unenforceable for any reason, Borrower hereby agrees to
make the maximum contribution to the payment and satisfaction of such
obligations that is permissible under applicable Law.
8.15 GOVERNING LAW; VENUE. THIS AGREEMENT AND ALL OTHER LOAN DOCUMENTS
AND SECURITY DOCUMENTS SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAWS OF THE STATE OF OHIO. VENUE FOR ANY PROCEEDING RELATED TO OR ARISING FROM
THIS AGREEMENT AND ALL OTHER LOAN DOCUMENTS SHALL BE FRANKLIN COUNTY, OHIO, AT
THE OPTION OF LENDER.
8.16 MAXIMUM INTEREST RATE. It is the intention of the parties hereto
to comply with applicable usury laws (now or hereafter enacted); accordingly,
notwithstanding any provision to the contrary in this Agreement, the Revolving
Credit Note, the other Loan Documents, or any other document relating hereto, in
no event shall this Agreement or any such other document require the payment or
permit the collection of interest in excess of the maximum amount permitted by
such laws. If from any circumstances whatsoever, fulfillment of any provision of
this Agreement or of any other document pertaining hereto or thereto, shall
involve transcending the limit of validity prescribed by law for the collection
or charging of interest, then, ipso facto, the obligation to be fulfilled shall
be reduced to the limit of such validity, and if from any such circumstances
Lender shall ever receive anything of value as interest or deemed interest by
applicable law under this Agreement, the Revolving Credit Note, the other Loan
Documents, or any other document pertaining hereto or otherwise an amount that
would exceed the highest lawful rate, such amount that would be excessive
interest shall be applied to the reduction of the principal amount owing under
the Revolving Credit Note or on account of any other indebtedness of Borrower to
Lender, and not to the payment of interest, or if such excessive interest
exceeds the unpaid balance of principal of such indebtedness, such excess shall
be refunded to Borrower. In determining whether or not the interest paid or
payable with respect to any indebtedness of Borrower to Lender, under any
specific contingency, exceeds the highest lawful rate, Borrower and Lender
shall, to the maximum extent permitted by applicable law, (a) characterize any
non-principal payment as an expense, fee or premium rather than as interest, (b)
exclude voluntary prepayments and the effects thereof, (c) amortize, prorate,
allocate and spread the total amount of interest throughout the full term of
such indebtedness so that the actual rate of interest on account of such
indebtedness does not exceed the maximum amount permitted by applicable law,
and/or (d) allocate interest between portions of such indebtedness, to the end
that no such portion shall bear interest at a rate greater than that permitted
by applicable law.
8.17 SEVERABILITY. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable, such provision shall be fully severable, and
the remaining
28
Exhibit 10.100
provisions of this Agreement shall remain in full force and effect and shall not
be affected thereby.
8.18 LENDER NOT IN CONTROL. None of the covenants or other provisions
contained in this Agreement shall, or shall be deemed to, give Lender the Right
or power to exercise control over the affairs or management of Borrower, the
power of Lender being limited to the Right to exercise the remedies provided in
Section 7.
8.19 INFORMATION SHARING. The Lender may provide any information the
Lender may have about the Borrower or about any matter relating to this
Agreement or the Obligations hereunder to Bank One Corporation, or any of its
subsidiaries or affiliates or their successors, or to any one or more purchasers
or potential purchasers of the Obligations. The Lender may at any time sell,
assign or transfer one or more interests or participations in all or any part of
its rights or obligations under this Agreement to one or more purchasers whether
or not related to the Lender. Notwithstanding the foregoing, the parties agree
that they shall not share personally identifiable information of any consumers
or customers with the other party, except as required to perform the parties'
respective obligations under this Agreement, and except as may be necessary for
Lender to exercise its rights under this Section 8.19 relative to sales,
transfers or potential sales or transfers, of the Obligations; and neither party
shall solicit any consumers or customers of the other party, based on personally
identifiable information received in connection with this Agreement.
8.20 ENTIRETY AND AMENDMENTS. THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
BY THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS EMBODY THE ENTIRE AGREEMENT BETWEEN
BORROWER AND LENDER AND SUPERSEDE ALL PRIOR PROPOSALS, AGREEMENTS AND
UNDERSTANDINGS RELATING TO THE SUBJECT MATTER HEREOF. BORROWER CERTIFIES THAT IT
IS RELYING ON NO REPRESENTATION, WARRANTY, COVENANT OR AGREEMENT EXCEPT FOR
THOSE SET FORTH HEREIN AND THE OTHER LOAN DOCUMENTS OF EVEN DATE HEREWITH.
[Remainder of Page Intentionally Left Blank]
29
Exhibit 10.100
8.21 MULTIPLE COUNTERPARTS. This Agreement may be executed in a number
of identical counterparts, each of which shall be deemed an original for all
purposes and all of which constitute, collectively, one Agreement; but, in
making proof of this Agreement, it shall not be necessary to produce or account
for more than one such counterpart.
Lender:
BANK ONE, NA
By: /s/ XXXXX XXXXXX
------------------------------
Name: Xxxxx Xxxxxx
Title: Commercial Loan Officer
Borrower:
E-LOAN, INC.
By: /s/ XXXX XXXXXXX
------------------------------
Name: Xxxx Xxxxxxx
Title: CFO
30
Exhibit 10.100
EXHIBITS
TO LOAN AGREEMENT
EXHIBIT A REVOLVING CREDIT NOTE
---------
EXHIBIT B FINANCIAL REPORT CERTIFICATE
---------
EXHIBIT C CONTRACT PURCHASE AGREEMENTS
---------
EXHIBIT D DEALER AGREEMENT
---------
1
Exhibit 10.100
EXHIBIT A
REVOLVING CREDIT NOTE
EFFECTIVE AS OF
$25,000,000 APRIL 2, 2001 ("NOTE DATE")
FOR VALUE RECEIVED, the undersigned, E-LOAN, INC., a Delaware
corporation, ("MAKER"), hereby unconditionally promises to pay on the first
anniversary of the Note Date to the order of BANK ONE, NA, a national banking
association with its principal offices in Columbus, Ohio ("LENDER"), not later
than noon, Eastern Time, at its office located at 0000 Xxxxxxx Xxxxxxx #0X,
Xxxxxxxx, Xxxx 00000 or at such other place as may be designated by Lender from
time to time, in lawful money of the United States of America and in immediately
available funds, the principal amount of the lesser of (i) TWENTY-FIVE MILLION
AND NO/100 DOLLARS ($25,000,000), or (ii) the aggregate unpaid principal balance
of all Revolving Credit Loans (as defined in that certain Loan Agreement, dated
as of even date herewith by and between Maker and Lender, as amended, modified
or supplemented from time to time, the "LOAN AGREEMENT") made by Lender to the
undersigned pursuant to the Loan Agreement, together with any interest from the
date hereof until maturity at the rates per annum provided below. Capitalized
terms not otherwise defined herein shall have the meanings ascribed to such
terms in the Loan Agreement.
1. RATES OF INTEREST AND PAYMENTS. Subject to the provisions of the
Loan Agreement, Maker agrees to pay interest in like money on the unpaid
principal amount hereof from time to time outstanding from the date hereof until
the principal balance hereof is paid in full at a fluctuating rate per annum
equal to the applicable rate of interest as set forth in the Loan Agreement.
Principal and interest payments on the unpaid principal balance and accrued
interest due hereunder shall be made and applied in accordance with the
provisions of the Loan Agreement, particularly Sections 2.5, 2.6, 2.7, 2.8, 2.9,
2.11 and 2.12 of the Loan Agreement. The provisions of Sections 2.6 and 8.16 of
the Loan Agreement shall control the computation of interest hereunder.
2. NOTICES. All notices required or permitted hereunder shall be in
writing, and given in the manner, and addressed to the Maker and Lender at the
addresses set forth in, Section 8.1 of the Loan Agreement, or at such other
address as such party may from time to time designate by written notice to the
others.
3. LOAN AGREEMENT. This is the Revolving Credit Note referred to in
the Loan Agreement, and the holder hereof is entitled to all the benefits
provided therein and in the other Loan Documents. Reference is made to the Loan
Agreement and the other Loan Documents which, among other things, contain
provisions regarding optional and mandatory prepayment and acceleration of
maturity upon certain Events of
1
Exhibit 10.100
Default described therein. This Revolving Credit Note is secured by the Security
Documents.
4. WAIVERS. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED FOR IN THE LOAN
AGREEMENT, TO THE FULLEST EXTENT PERMITTED BY LAW, THE MAKER, SIGNERS, SURETIES,
GUARANTORS, ENDORSERS AND OTHER PARTIES EVER LIABLE FOR PAYMENT OF ANY SUMS OF
MONEY PAYABLE ON THIS REVOLVING CREDIT NOTE JOINTLY AND SEVERALLY WAIVE
VALUATION AND APPRAISAL, DEMAND, PRESENTMENT, NOTICE OF DISHONOR, NOTICE OF
INTENT TO DEMAND OR ACCELERATE PAYMENT HEREOF, NOTICE OF DEMAND, NOTICE OF
ACCELERATION, DILIGENCE IN COLLECTING, GRACE, NOTICE, AND PROTEST, AND AGREE TO
ONE OR MORE RENEWALS OR EXTENSIONS FOR ANY PERIOD OR PERIODS OF TIME, PARTIAL
PAYMENTS, AND RELEASES OR SUBSTITUTIONS OF SECURITY, IN WHOLE OR IN PART, WITH
OR WITHOUT NOTICE, BEFORE OR AFTER MATURITY. NO WAIVER BY LENDER OF ANY OF ITS
RIGHTS OR REMEDIES HEREUNDER OR UNDER ANY OTHER DOCUMENT EVIDENCING OR SECURING
THIS REVOLVING CREDIT NOTE OR OTHERWISE SHALL BE CONSIDERED A WAIVER OF ANY
OTHER SUBSEQUENT RIGHT OR REMEDY OF LENDER; NO DELAY OR OMISSION IN THE EXERCISE
OR ENFORCEMENT BY LENDER OF ANY RIGHTS OR REMEDIES SHALL EVER BE CONSTRUED AS A
WAIVER OF ANY RIGHT OR REMEDY OF LENDER; AND NO EXERCISE OR ENFORCEMENT OF ANY
SUCH RIGHTS OR REMEDIES SHALL EVER BE HELD TO EXHAUST ANY RIGHT OR REMEDY OF
LENDER.
5. LEGAL FEES. If this Revolving Credit Note shall be collected by
legal proceedings or through a probate or bankruptcy court, or shall be placed
in the hands of an attorney for collection after an Event of Default or
maturity, the undersigned agrees to indemnify Lender for all costs of
collection, including, but not limited to court costs and reasonable attorneys'
fees.
6. ACCELERATION. Upon the occurrence of one or more of the Events of
Default specified in the Loan Agreement, the holder thereof may, at its option,
declare the entire unpaid balance of principal and accrued interest on this
Revolving Credit Note to be immediately due and payable, without notice of any
kind.
7. AGREEMENT WITH RESPECT TO PREVENTION AND RESOLUTION OF DISPUTES.
THIS REVOLVING CREDIT NOTE SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH A CERTAIN AGREEMENT WITH RESPECT TO PREVENTION AND
ENFORCEMENT OF DISPUTES ("DISPUTE RESOLUTION AGREEMENT"), THE TERMS AND
PROVISIONS OF WHICH ARE INCORPORATED HEREIN. AMONG OTHER PROVISIONS, THE DISPUTE
RESOLUTION AGREEMENT PROVIDES FOR WAIVER OF JURY BY LENDER AND MAKER,
JURISDICTION AND VENUE IN FRANKLIN COUNTY, OHIO, AND CONSTRUCTION AND
INTERPRETATION UNDER THE LAWS OF THE STATE OF OHIO.
9. NOTICE OF FINAL AGREEMENT. THIS AGREEMENT REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
2
Exhibit 10.100
10. MISCELLANEOUS. Maker and the Lender intend that this Revolving
Credit Note shall be in compliance with all applicable laws and shall be
enforceable in accordance with its terms. If any provision of this Revolving
Credit Note shall be illegal or unenforceable, such provision shall be deemed
cancelled to the same extent, as though it never had appeared herein, but the
remaining provisions shall not be affected thereby. In the event that the
interest rate provided for in this Revolving Credit Note shall be deemed to be
usurious under applicable law, then such interest rate shall be deemed modified
to the highest rate permitted under such applicable usury law and all payments
theretofore made shall be credited as though such rate had been the rate
originally provided for herein.
Any and all references in this Revolving Credit Note to any other
document or documents shall be references to such other document or documents as
the same may from time to time be modified, amended, renewed, consolidated or
extended.
The term "Maker" as used herein shall include the undersigned and its
successors and assigns; provided that this paragraph shall not be deemed to be a
consent or approval by the Lender of any transfer or assignment by Maker.
This Revolving Credit Note, is executed as of the date and year first
above written.
MAKER:
E-LOAN, INC.
------------------------------
By:
---------------------------
Its:
--------------------------
3
Exhibit 10.100
EXHIBIT B
ADVANCE REQUEST FORM
TO: Bank One, NA
0000 Xxxxxxx Xxxxxxx #0X
Xxxxxxxx, XX 00000
Attn: Xxxxx Xxxxxx
DATED AS OF: ______________________
BORROWER: E-Loan, Inc.
Ladies and Gentlemen:
The undersigned is the President of the Borrower, and is authorized by
the Borrower to make and deliver this certificate pursuant to that certain Loan
Agreement effective as of April 2, 2001, by and between Borrower and Bank One,
NA (as the same may be amended, renewed, extended, modified and/or restated from
time to time, the "AGREEMENT"). All terms defined in the Agreement shall have
the same meaning herein. Borrower hereby requests a Revolving Credit Loan in
accordance with SECTION 2.1 of the Agreement.
In connection with the foregoing and pursuant to the terms and provisions
of the Agreement, the Borrower hereby represents and warrants that:
(a) All of the representations and warranties of Borrower contained in
the Agreement and in any of the other Loan Documents are true and correct in all
material respects on the date hereof, as though made on and as of such date. The
Financial Statements delivered by Borrower to Lender through the date hereof are
true, correct and complete in all material respects and fully comply with the
provisions of the Agreement.
(b) No event has occurred and is continuing, or would result from the
Revolving Credit Loan requested, which constitutes or would constitute a Default
or Event of Default.
(c) No change has occurred in the business, assets, operations,
prospects or financial or other condition of the Borrowers which could have a
Material Adverse Effect since the date of the last Revolving Credit Loan.
(d) The aggregate unpaid principal amount of all Revolving Credit
Loans, after giving effect to this Revolving Credit Loan is equal to or less
than the lesser of (x) the Borrowing Base, and (y) the Commitment.
(e) All information supplied herein and herewith is true, correct, and
complete as of the date hereof.
1
Exhibit 10.100
No Event of Default exists on the date hereof, other than ______________
_____________________________ [if none, so state].
Sincerely,
----------------------------------------
President
Enclosures:
[MATERIALS REQUIRED BY THE LOAN AGREEMENT]
2
Exhibit 10.100
FINANCIAL REPORT CERTIFICATE
[Letterhead of Borrower]
____________________, 2001
Bank One, NA-OH1-1009
0000 Xxxxxxx Xxxxxxx #0X
Xxxxxxxx, XX 00000
Attn: Xxxxx Xxxxxx
Ladies and Gentlemen:
The undersigned, President of E-Loan, Inc. ("BORROWER"), gives this
Financial Report Certificate (the "CERTIFICATE") to Bank One, NA ("LENDER") in
accordance with the requirements of that certain Loan Agreement effective as of
April 2, 2001, between Borrower and Lender ("LOAN AGREEMENT"). Capitalized terms
used in this Certificate, unless otherwise defined herein, shall have the
meanings ascribed to them in the Loan Agreement.
1. Based upon my review of the balance sheets and statements of
income and other financial information of Borrower for the [fiscal year] [month]
ending ___________, _____, copies of which are attached hereto, I hereby certify
that:
(a) The Borrower's ratio of Debt to Tangible Net Worth as of
_____________________ is _____ to _____. (See Section 5.2(k) of the Loan
Agreement.)
(b) The Borrower's Tangible Net Worth as of
__________________________ is __________________. (See Section 5.2(l) of
the Loan Agreement.)
2. No Event of Default exists on the date hereof, other than:
_______________________________ [if none, so state]; and
Very truly yours,
---------------------------
3
Exhibit 10.100
EXHIBIT C
CONTRACT PURCHASE AGREEMENTS
1. Strategic Alliance Agreement between Bank of America, N.A., Banc
of America Auto Finance Corp., and Electronic Vehicle Remarketing,
Inc. dated August 23, 1999 (1)+
2. Auto Loan Purchase and Sale Agreement with Bank of America dated
May 16, 2000 (2)+
3. Auto Loan Purchase and Sale Agreement with AmeriCredit Financial
Services dated June 5, 2000 (2)+
4. Auto Loan Purchase and Sale Agreement with TranSouth Financial
Corporation dated May 4, 2000 (2)+
5. Auto Loan Purchase and Sale Agreement with Xxxxx Fargo Bank, N.A.
- Auto Finance Group dated May 1, 2000 (2)+
(1) Filed with Quarterly Report on Form 10-Q (FQE 09/30/99) on November 15,
1999, as amended.
(2) Filed with Quarterly Report on Form 10-Q (FQE 06/30/00) on August 14, 2000.
+ Confidential Treatment Requested.
1
Exhibit 10.100
EXHIBIT D
DEALERSHIP AGREEMENT
[GRAPHIC]
1
Exhibit 10.100
SCHEDULES
SCHEDULE 3.1 CLOSING DOCUMENTS AND CONDITIONS
SCHEDULE 4.4 PRIOR NAMES AND TRADE NAMES OF BORROWER
SCHEDULE 4.8 PENDING LITIGATION INVOLVING BORROWER OR GUARANTOR
SCHEDULE 4.11 EMPLOYEE BENEFIT PLANS
SCHEDULE 4.13 PERMITTED LIENS
SCHEDULE 4.15 CONSENTS REQUIRED
SCHEDULE 4.16 SUBSIDIARIES AND AFFILIATES
SCHEDULE 4.17 OWNERSHIP
SCHEDULE 5.2(a) PERMITTED DEBT
SCHEDULE 5.2(h) TRANSACTIONS WITH AFFILIATES OR SUBSIDIARIES
SCHEDULE 5.2(r) BUSINESS LOCATIONS
SCHEDULE 8.1 NOTICES
1
Exhibit 10.100
SCHEDULE 3.1
CLOSING DOCUMENTS AND CONDITIONS
1. LOAN AGREEMENT. This Loan Agreement shall have been duly executed and
delivered to Lender by Borrower.
2. REVOLVING CREDIT NOTE. Lender shall have received the Revolving Credit
Note, dated on or about the Closing Date, conforming to the requirements of this
Loan Agreement and duly executed by Borrower.
3. AGREEMENT WITH RESPECT TO PREVENTION AND RESOLUTION OF DISPUTES. Lender
shall have received the Agreement With Respect To Prevention and Resolution of
Disputes, dated on or about the Closing Date, duly executed by Borrower.
4. SECURITY AGREEMENT. Lender shall have received the Security Agreement of
Borrower, dated on or about the Closing Date, duly executed by Borrower.
5. FINANCING STATEMENTS. All financing statements required or, in Lender's
opinion, advisable to be filed in order to create, in favor of Lender, a first
priority perfected Lien on all assets of Borrower with respect to which a Lien
can be perfected by means of filing a UCC financing statement, shall have been
properly executed and delivered to Lender and filed of record, and all necessary
filing, subscription and inscription fees and all recording and other similar
fees, and all taxes and other expenses related to such filings and recordings
shall have been paid in full on behalf of the above referenced parties.
6. UCC SEARCHES. Lender shall have received the results of UCC searches
showing all filings of purported lien holders against Borrower in such other
offices as Lender may require, each search dated a date reasonably close to the
Closing Date.
7. RELEASES AND/OR ASSIGNMENTS. Lender shall have received releases and/or
assignments or agreements to execute such releases and/or assignments of all
existing Liens (other than permitted liens) on the Collateral against the assets
of Borrower.
8. RELATED DOCUMENTS RELATIVE TO BORROWER. Lender shall have received the
following, dated reasonably close to the Closing Date, for Borrower:
a. GENERAL CERTIFICATE WITH INCUMBENCY. Lender shall have received a
Certificate from the President or Chief Executive Officer of Borrower, dated the
Closing Date, to the effect that: (i) the representations and warranties made by
Borrower in the Loan Documents to which such Borrower is a party or which are
contained in any certificate, document or financial or other statement furnished
at the time of or in connection with the transaction contemplated hereunder
shall be correct on and as of the Closing Date as if made on and as of such
date; (ii) no Default or Event of Default shall have occurred and be continuing
on the Closing Date; and, (iii) no outstanding or
1
Exhibit 10.100
unpaid judgment and/or actions, suits or proceedings, before any court or before
any governmental or administrative body or agency which might prevent or
preclude the consummation of the transactions contemplated hereunder are pending
or threatened against Borrower.
b. CORPORATE PROCEEDINGS. Lender shall have received a copy of the
resolution of the Board of Directors of Borrower authorizing: (i) the execution,
delivery and performance of all Loan Documents to which such Borrower is a
party, (ii) the consummation of the transactions contemplated hereunder or
thereunder; and, (iii) the borrowings and grants of Liens under the Loan
Documents, all of the above certified by the secretary of Borrower on or about
the Closing Date. Such certificates shall state that the resolutions set forth
therein have not been amended, modified, revoked or rescinded as of the date of
such certificates.
c. INCUMBENCY CERTIFICATES. Lender shall have received a certificate of
the President and/or Chief Executive Officer of Borrower dated on or about the
Closing Date, as to the incumbency and signature of the officers of Borrower
executing each of the Loan Documents to which Borrower is a party, together with
evidence of the incumbency of such Chief Executive Officer and/or President.
d. CHARTER DOCUMENTS AND BY-LAWS. Lender shall have received: (i) a copy,
certified as of the date reasonably close to the Closing Date by the secretary
of the state of incorporation or organization, of the Articles of Incorporation,
together with all amendments thereto, of Borrower; (ii) a copy, certified as of
the Closing Date by the Chief Executive Officer and/or President of Borrower, of
its by-laws in effect on the Closing Date; (iii) a certificate or telex
confirmation as of a date reasonably close to the Closing Date from the
Secretary of State or other appropriate governmental officer as to Borrower as
to the existence and standing of Borrower; (iv) a certificate dated as of a date
reasonably close to the Closing Date from each state in which Borrower is
qualified to do business as to the existence and standing of Borrower; and, (v)
a certificate dated as of the Closing Date from the Chief Executive Officer
and/or President of Borrower to the effect that the documents delivered pursuant
to clauses (i) and (ii) are true and correct copies of such documents and, as
relates to the documents delivered pursuant to clause (i), as on file with the
secretary of state of the state of incorporation or organization or other
governmental officer and no action has been taken to amend, modify or repeal
such documents delivered pursuant to clauses (i) and (ii) above, the same being
in full force and effect in such form on the Closing Date.
e. COPIES OF LEASES. Lender shall have received copies of each equipment
and premises lease to which Borrower is a party whether as lessor or lessee,
accompanied by a certificate that such copies are correct and complete, dated on
or about the Closing Date, by the President or Chief Executive Officer of
Borrower.
9. INSURANCE. Lender shall have received from Borrower evidence satisfactory
to Lender as to the satisfaction of the requirements relating to insurance set
forth in this Agreement.
2
Exhibit 10.100
10. CONTRACT PURCHASE AGREEMENTS. The Contract Purchase Agreements shall have
been delivered by Borrower to Lender which shall comport with the requirements
of this Loan Agreement.
11. REGULATORY APPROVALS: CONSENTS. Lender shall have received evidence
satisfactory to Lender that all requisite regulatory approvals and consents of
any other Person with respect to the transactions contemplated by the Loan
Documents have been obtained in order to consummate the transactions
contemplated hereby.
12. ABSENCE OF CHANGES. Lender shall have received evidence satisfactory to
Lender including, without limitation, a certificate executed by the President or
Chief Executive Officer of Borrower, to such effect, that no material adverse
change has occurred in the business, assets, operations, prospects or financial
or other condition of Borrower.
13. ACCOUNTANTS LETTER. Lender shall have received a letter or letters approved
by Borrower and addressed to Borrower's independent certified public
accountants, authorizing such accountants to disclose to Lender any and all
financial statements and other supporting financial documents and schedules,
including copies of any management letter with respect to the business,
financial condition and other affairs of Borrower.
14. REPORTS. Lender shall have received a Borrowing Base Report dated on or
about the Closing Date.
15. SUBORDINATION/INTERCREDITOR AGREEMENTS. Lender shall have received
Subordination or Intercreditor Agreements in favor of Lender, in form and
content acceptable to Lender in its sole discretion, authorized and executed by
each Person to whom/which Borrower owes Debt or other payment obligations.
16. OPINION OF BORROWER'S COUNSEL. Lender shall have received the opinion of
Borrower's legal counsel regarding the loan transaction hereunder and such
issues related thereto as Lender may require.
17. DUE DILIGENCE. The results of Lender's, its auditor's and legal counsel's
due diligence regarding the transaction hereunder shall be satisfactory to
Lender, and Lender shall be satisfied with the assets, books and records and the
business and financial condition of Borrower.
18. OTHER DOCUMENTS. Such other agreements, documents, instruments, opinions,
certificates and evidences as Lender or its legal counsel may request.
All of the foregoing shall be in a form and of a substance acceptable to
Lender.
3
Exhibit 10.100
SCHEDULE 4.4
PRIOR NAMES AND TRADE NAMES OF BORROWER
- Palo Alto Funding Group, Inc. (from October 1992 to December 18, 1997)
- Eloan, Inc. (from August 21, 1996 to August 28, 1997)
Exhibit 10.100
SCHEDULE 4.8
PENDING LITIGATION INVOLVING BORROWER
XXXXXXX V. FIRST UNION MORTGAGE CORPORATION, ET AL.
On December 21, 1999, Xxxxxxx Xxxxxxx ("Xxxxxxx") filed a complaint against
First Union Mortgage Corporation ("First Union") in the Circuit Court of Shelby,
Alabama, as case no. Cvaa-1049, seeking an injunction to prevent First Union
from foreclosing on the plaintiff's residence, compensatory and punitive
damages, and statutory damages for violation of the Fair Debt Collection
Practices Act. The case was removed to the U.S. District Court for the Northern
District of Alabama, as case no. CV-J-0160-S, and E-LOAN and Service Link, L.P.
were added as defendants, in a 1st Amendment to Complaint that was filed in that
Court. In the 1st Amendment to Complaint, the plaintiff seeks compensatory and
punitive damages in an unspecified amount against First Union, E-LOAN and
Service Link arising from their actions in August and September of 1999,
relating plaintiff's application for a refinance loan that was not funded. On or
about June 28, 2000, First Union filed a cross-claim against E-LOAN and Service
Link, alleging fraud and unjust enrichment, and seeking damages in the amount of
$77,940.27, plus compensatory and punitive damages, and attorney's fees. E-LOAN
has filed a response to the complaint and cross-claims, denying any liability.
The parties are proceeding with discovery, and have tentatively agreed to a
settlement whereby E-LOAN would make a no-fee mortgage loan to Xxxxxxx in the
principal amount of approximately $109,000, and pay the sum of $5,000, in
exchange for a dismissal with prejudice and a full release of claims.
Exhibit 10.100
SCHEDULE 4.11
EMPLOYEE BENEFIT PLANS
401(K) SAVINGS PLAN
The Company has a savings plan that qualifies as a deferred salary arrangement
under Section 401(k) of the Internal Revenue Code (the "401(k) Plan"). Under the
401(k) Plan, participating employees may defer a percentage (not to exceed 20%)
of their eligible pretax earnings up to the Internal Revenue Service's annual
contribution limit. All employees on the United States payroll of the Company
age 21 years or older are eligible to participate in the 401(k) Plan.
STOCK OPTION AND EMPLOYEE STOCK PURCHASE PLANS
As of December 31, 2000, the Company had reserved up to 12,100,000 shares of
common stock issuable upon exercise of options issued to certain employees,
directors, and consultants pursuant to the Company's 1997 Stock Option Plan.
Such options were exercisable at prices established at the date of grant, and
have a term of ten years. Initial optionee grants had a vested interest in 25%
of the option shares upon the optionee's completion of one year of service
measured from the grant date. The balance will vest in equal successive monthly
installments of 1/48 upon the optionee's completion of each of the next 36
months of service. If an option holder ceases to be employed by the Company,
vested options held at the date of termination may be exercised within three
months. Options under the plan may be either Incentive Stock Options, as defined
under Section 422 of the Internal Revenue Code, or Nonstatutory Options. During
the years ended December 31, 1998, 1999 and 2000, 3,084,627, 4,961,910 and
6,458,404 options had been granted and 621,630, 2,304,101 and 888,133 options
were still available for grant under the Company's stock option plan.
In March 1999, the Company adopted the 1999 Employee Stock Purchase Plan (the
"Purchase Plan") under which 1,500,000 shares of common stock were reserved for
issuance. Employees who participate in the Purchase Plan may have up to 15% of
their earnings withheld and used to purchase shares of common stock on specified
dates as determined by the Board. The price of common stock purchased under the
Purchase Plan is equal to 85% of the lower of the fair market value of the
common stock, at the commencement date or the ending date of each 24-month
offering period. Each offering period includes four six-month purchase periods.
No compensation expense is recorded in connection with this plan.
Attached is a summary of benefits for E-LOAN's California and Florida employees,
respectively.
[GRAPHIC]
Exhibit 10.100
SCHEDULE 4.13
PERMITTED LIENS
1. Pledges or deposits made to secure payment of worker's compensation,
or to participate in any fund in connection with worker's compensation,
unemployment insurance, pensions, or other social security programs;
2. The following to the extent no Lien has been filed in any jurisdiction
or agreed to: Liens for Taxes not yet due and payable; mechanic's lien and
materialmen's Liens for services or materials for which payment is not yet due
and payable; and landlord's Liens for rental not yet due and payable and which,
to the extent the same encumbers any of the Collateral, is subordinate to Liens
in favor of Lender;
3. The following so long as (i) the validity or amount thereof is being
contested in good faith and by appropriate and lawful proceedings diligently
conducted, (ii) reserve or other appropriate provision (if any) required by
Lender shall have been made, (iii) levy and execution thereon have been stayed
and continue to be stayed, (iv) any thereof covering any Collateral must be
subordinate to all Liens in favor of Lender, and (v) they do not in the
aggregate materially detract from the value of the property of the Person in
question, or materially impair the use thereof in the operation of its business:
Claims and Liens for Taxes due and payable; claims and Liens upon, and
defects of title to, real or personal property (other than any of the
Collateral), including any attachment of personal or real property or other
legal process prior to adjudication of a dispute on the merits; claims and
Liens of mechanics, materialmen, warehousemen, carriers, landlords, or
other like Liens; and adverse judgments on appeal.
Exhibit 10.100
SCHEDULE 4.15
CONSENTS REQUIRED
[GRAPHIC]
Exhibit 10.100
SCHEDULE 4.16
SUBSIDIARIES AND AFFILIATES
E-Loan International, Inc. - Wholly-owned subsidiary that is a British Virgin
Islands Corporation for the purpose of holding shares in our international joint
ventures.
E-Loan Japan, K.K. - Joint Venture with SOFTBANK Finance Corporation. E-Loan,
Inc. ownership is 40% as of March 2001.
Exhibit 10.100
SCHEDULE 4.17
OWNERSHIP
E-Loan, Inc., is a public company traded on NASDAQ under the symbol EELN. The
following are those beneficial owners of borrower of 5% or greater interest.
BENEFICIAL OWNER NUMBER PERCENT
---------------- ---------- -------
Entities affiliated with Benchmark Capital Partners 10,200,254 19.01%
Entities affiliated with Technology Partners 6,065,403 11.31%
Entities affiliated with SOFTBANK 5,437,797 10.14%
Xxxxxxxxx X. Xxxxxx 3,722,153 6.94%
Xxxxxx Xxxxxxxxx 3,672,303 6.84%
WARRANTS OUTSTANDING
1. Warrant to purchase 6,500,000 shares common stock at an exercise price of
$3.75, expires 4/25/2003
2. Warrant to purchase 6,600,000 shares common stock at an exercise price of
$15.00, expires 7/25/2003
3. Warrant to purchase 300,000 shares common stock at an exercise price of
$1.55, expires 2/23/2006
OPTIONS OUTSTANDING
1. 1997 Stock Option Plan - 12,290,455 shares authorized but unissued as of
3/30/01
2. 1999 Employee Stock Purchase Plan - 2,385,599 shares available for purchase
Exhibit 10.100
SCHEDULE 5.2(a)
PERMITTED DEBT
1. Debt secured by Permitted Liens; so long as such Permitted Liens do not
impair the priority or enforceability of the Liens of Lender.
Exhibit 10.100
SCHEDULE 5.2(h)
TRANSACTIONS WITH AFFILIATES OR SUBSIDIARIES
None.
Exhibit 10.100
SCHEDULE 5.2(r)
BUSINESS LOCATIONS
E-Loan, Inc.
0000 Xxxxxx Xxxx
Xxxxxx, XX 00000
E-Loan, Inc.
0000 - 000 Xxxxxxx Xxxxxxx
Xxxxxxxxxxxx, XX 00000
Exhibit 10.100
SCHEDULE 8.1
NOTICES
AS TO BORROWER WITH COPY TO:
E-Loan, Inc. E-Loan, Inc.
0000 Xxxxxx Xxxx 0000 Xxxxxx Xxxx
Xxxxxx, XX 00000 Xxxxxx, XX 00000
Telephone: 000- 000-0000 Telephone: 000-000-0000
Telefax: 000-000-0000 Telefax: 000-000-0000
Attn: Xxxxxx X. Xxxxxxx, President Attn: Xxxxxx X. Xxxxxxxx, Counsel
AS TO LENDER: WITH COPY TO:
Bank One, Columbus, NA-OH1 -1 009 Xxxxxx X. Xxx, Esq.
0000 Xxxxxxx Xxxxxxx #0X Xxxxx & Xxxxxx, LLP
Xxxxxxxx, XX 00000 1 0 Xxxx Xxxxx Xxxxxx
Telephone: 000-000-0000 Xxxxxxxx, XX 00000
Telefax: 000-000-0000 Telephone: 000-000-0000
Attn: Xxxxx Xxxxxx Telefax: 614-221-0479
