[LOGO] Fleet Exhibit 10.9
PLEDGE AGREEMENT
LOG ON AMERICA, INC., a corporation duly organized and existing by and under the
laws of the State of Delaware, having an office located at Three Regency Plaza,
Providence, Rhode Island 02903, (hereinafter jointly and severally if more than
one, referred to herein as the "Pledgor"), and FLEET NATIONAL BANK, a banking
institution duly organized and existing by and under the laws of the United
States of America, having an office located at 000 Xxxxxxxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxx Xxxxxx 00000, (hereinafter referred to as the "Bank"), hereby
agree as follows:
1. Definitions. The following definitions apply:
Borrower: shall mean LOG ON AMERICA, INC. (hereinafter jointly and severally if
more than one, referred to herein as "Borrower").
Liabilities: All obligations, indebtedness and liability of any type of the
Borrower and the Pledgor to the Bank, which arise out of or in connection with
or which in any way relates to that certain Promissory Note from the Borrower to
the Bank in the original principal amount of Four Million ($4,000,000.00)
Dollars, (hereinafter referred to herein as the "Loan") executed in connection
herewith, whether now existing or hereafter incurred, whether direct, indirect,
absolute or contingent, whether otherwise guaranteed or secured, and howsoever
evidenced or acquired, and expenses or costs incurred by the Bank in the
administration of this Pledge Agreement and the enforcement of any of its rights
with respect thereto.
For and in consideration of the sum of TEN ($10.00) DOLLARS, and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, and for and in consideration of inducing the Bank to lend to the
Borrower the principal sum referred to hereinabove, the Pledgor hereby pledges
to the Bank as collateral security for said loan, the following pledged
collateral:
Pledged Collateral: (i) The property delivered or otherwise transferred by the
Pledgor to the Bank and consisting, as of the date of this Agreement, of the
property described on affixed Exhibit A attached hereto and made a part hereof;
and/or any and all substitutions, additions and accessions thereto upon which
the Pledgor hereby grants and pledges to the Bank and upon which the Bank shall
have absolute control over the pledged collateral which shall include, but not
be limited to, investment property, securities, security entitlements and any
and all financial assets credited to said pledged collateral; (ii) any and all
securities (both certificated and uncertificated), closely held capital stock,
notes, mortgages, instruments, documents, letters of credit, certificates of
deposit, deposit accounts, bank accounts, balances in any account of the Pledgor
with the Bank, and all other property interests which may subsequently be
delivered or transferred by the Pledgor to the Bank; (iii) any of the foregoing
when put in transit to the Bank; (iv) in the case of securities and closely held
capital stock, Pledged Collateral shall include, without limitation, all shares
of any class of the capital stock of the issuer which shall be issued or
distributed (by way of stock dividends or otherwise) or sold by the issuer to
the Pledgor at any time or times after the date of this Agreement or which shall
be purchased or otherwise acquired by or on behalf of the Pledgor from the
issuer or from any other person or persons at any time or times after the date
of this Agreement; all dividends of every kind which shall become and be due and
payable or distributable on or in respect of all or any of the securities and
closely held capital stock; all payments of every kind whatever which shall
become and be due and payable or distributable on account of the purchase,
redemption, repurchase or other retirement of all or any of the securities and
closely held capital stock; all other distributions of every kind (including,
without limitation, all capital distributions) which shall become and be due and
payable or distributable on or in respect of the securities and closely held
capital stock; and (v) all proceeds of the foregoing, including, without
limitation, the roll-over or reinvested proceeds of the foregoing. Any delivery
or transfer of any of the Pledged Collateral to an agent or custodian designated
by the Bank shall be deemed a delivery or transfer to the Bank.
2. Security Interest. The Pledgor hereby pledges, hypothecates, and impresses
the Pledged Collateral with a lien in favor of the Bank, and grants to the Bank
a security interest in the Pledged Collateral, to secure the punctual payment
and performance of all Liabilities.
3. Pledgor's Additional Obligations. The Pledgor agrees that: (1) any
distribution in kind received by the Pledgor from any party for or on account of
the Pledged Collateral, including distributions of stock as a dividend or split
of any of the Pledged Collateral, shall be immediately delivered to the Bank in
the form received with any recurred endorsement; (2) additional collateral in
form and kind satisfactory to the Bank will be deposited by the Pledgor with the
Bank if the Bank at any time deems the Pledged Collateral insufficient or
unsatisfactory; (3) any note or other instrument executed and delivered to the
Pledgor by any party to evidence any obligation of such party with respect to
the Pledged Collateral shall be immediately delivered with any required
endorsement to the Bank. All such items shall be held by the Bank in accordance
with the terms of this Pledge Agreement.
The Pledgor agrees to pay to the Bank on demand all reasonable fees, costs and
expenses incurred by the Bank in connection with the administration of this
Pledge Agreement, including, without limitation, overnight courier fees, lien
search fees, and filing and recording fees.
The Pledgor agrees to execute and deliver to the Bank and/or third parties
designated by the Bank such additional documents, notices, requests and other
instruments as the Bank deems necessary or advisable to protect the Bank's
rights under this Pledge Agreement.
4. Certain Rights and Duties of Bank. The Pledgor acknowledges that: the Bank
has no duty of any type with respect to the Pledged Collateral except for the
use of due care in safekeeping any of the Pledged Collateral actually in the
physical custody of the Bank; prior to the occurrence of any event of default
described in the succeeding paragraph the Bank's rights with respect to the
Pledged Collateral shall be limited to the Bank's rights as a secured party and
pledgee and the right to perfect its security interest, preserve, enforce and
protect the lien granted hereunder and its interest in the Pledged Collateral;
and the Bank may sell, assign or grant participations in any of the Liabilities
and any of the Pledged Collateral and that the Bank's purchaser, assignee or
participant shall have the same rights and privileges with respect to such
Liabilities and Pledged Collateral as the Pledgor grants to the Bank under this
Pledge Agreement. With respect to any Pledged Collateral with a stated maturity
date (including, without limitation, certificates of deposit and other term
accounts), the Bank is authorized and directed, upon maturity, to roll-over and
reinvest such Pledged Collateral in a similar investment, with such tenor and
interest rate or yield as the Bank, in its discretion, deems to be reflective of
prevailing market conditions. Prior to the occurrence of any event of default
described in the succeeding paragraph, the Bank agrees that it will not vote any
Pledged Collateral constitution securities or closely held capital stock.
5. Events of Default; Remedies. Upon occurrence of any event of default under
any instrument evidencing any of the Liabilities or of any of the following
events: (1) default in the payment or performance of any other of the
obligations or liabilities of the Pledgor under any agreement between the Bank
and Pledgor; (2) the Pledgor, if a business entity, discontinues business
operations at any of the Pledgor's locations; (3) the Pledgor is generally
unable to pay debts as they become due or the Bank deems itself insecure; (4)
the Pledgor makes a general assignment for the benefit of creditors; (5) the
entry of a decree, order or order for relief by a court having jurisdiction of a
case initiated by or against the Pledgor under the federal bankruptcy code or
any other federal or state laws pursuant to which a receiver, liquidator,
assignee, custodian, trustee, sequestrator, debtor in possession, examiner or
other similar official, is appointed for the Pledgor or any of the Pledgor's
property with or without consent, for any purpose whatsoever; (6) a substantial
part of the property of the Pledgor is taken by attachment, execution or any
other form of legal process; (7) the assertion of any levy, seizure or
attachment on the Pledged Collateral; or (8) death of an individual Pledgor or
dissolution or termination of legal existence of a corporate, limited liability
company, partnership or trust Pledgor, then the Bank, with or without notice to
the Pledgor and without demand for additional collateral, may (a) transfer the
Pledged Collateral into the name of the Bank or its nominee and vote any Pledged
Collateral constituting securities or closely held capital stock, (b) sell at
public or private sale any or all of the Pledged Collateral, which the Bank may
purchase free from any right of [ILLEGIBLE]mption; or (c) at its discretion in
its own name or in the name of Pledgor take any action for the collection of
the Pledged Collateral, including the filing of a proof of claim in insolvency
proceedings, and may receive the proceeds thereof and execute releases therefor.
After deducting its expenses, including reasonable attorney's fees (which may
include costs allocated by the Bank's internal legal department), incurred in
the sale or collection of the Pledged Collateral, the Bank shall apply the
proceeds to the Liabilities and shall account to the Pledgor for any surplus.
The Pledgor agrees that the Bank has no obligation to sell or otherwise
liquidate the Pledged Collateral in any particular order or to apply the
proceeds thereof to any particular portion of the Liabilities. The Pledgor
further agrees that after the occurrence of an event of default, the Bank shall
have no obligation to vote any Pledged Collateral constituting securities or
closely held capital stock.
In connection with an secured party's sale, the Bank is authorized, if it deems
it advisable to do so, in order to comply with any applicable securities laws,
to restrict the prospective bidders or purchasers to persons who will represent
and agree that they are purchasing the Pledged Collateral for their own account
for investment, and not with a view to the distribution or re-sale thereof.
Sales made subject to such restriction shall be deemed to have been made in a
commercially reasonable manner.
6. Power of Attorney, Etc. The Pledgor hereby irrevocably constitutes and
appoints the Bank the true and lawful attorney-in-fact for and on behalf of the
Pledgor with full power of substitution and revocation in its own name or in the
name of the Pledgor to make, execute, deliver and record any and all financing
statements, continuation statements, assignments, proofs of claim, powers of
attorney, leases, discharges or other instruments or agreements which the Bank
in its sole discretion may deem necessary or advisable to perfect, preserve,
enforce or protect the lien granted hereunder and its interest in the Pledged
Collateral and to carry out the purposes of this Pledge Agreement, including but
without limiting the generality of the foregoing, any and all proofs of claim in
bankruptcy or other insolvency proceedings of the Borrower, with the right to
collect and apply to the Liabilities all distributions and dividends made on
account of the Pledged Collateral. The rights and powers conferred on the Bank
by the Pledgor are expressly declared to be coupled with an interest and shall
be irrevocable until all the Liabilities are paid and performed in full. A
carbon, photographic, or other reproduction of a security agreement (including
this Pledge Agreement) or a financing statement is sufficient as a financing
statement.
7. Miscellaneous. This Pledge Agreement and the Pledged Collateral shall not be
in any way be affected by the extension of time or renewal of any of the
Liabilities, the modification in any manner or the taking or release in whole or
in part of any security therefor or the obligations of any endorsers, sureties,
guarantors or other parties or the granting of any other indulgences to the
Borrower or to the Pledgor. No termination of this Pledge Agreement shall be
effective in an event until the Bank in its discretion determines that the
Liabilities of the Borrower covered by this Pledge Agreement have been satisfied
in full.
8 Notices. Except as otherwise specifically provided for herein, any notice,
demand or communication hereunder shall be given in writing (including facsimile
transmission or telex) and mailed or
delivered to each party at its address set forth below, or, as to each party, at
such other address as shall be designated by such party by a prior notice to the
other party in accordance with the terms of this provision.
Any notice to the Bank shall be sent as follows:
FLEET NATIONAL BANK
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxx Xxxxxx 00000
Attention: Xxxx Xxxxx, Senior Vice President
Any notice to the Pledgor shall be sent as follows:
LOG ON AMERICA, INC.
Three Regency Plaza
Providence, Rhode Island 02903
Attention: Xxxxx Paolo, President
All notices hereunder shall be effective (i) five (5) business days after such
notice is mailed, by registered or certified mail, postage prepaid (return
receipt requested), (ii) upon delivery by hand, (iii) upon delivery if delivered
by overnight courier (such delivery to be evidenced by the courier's records),
and (iv) in the case of any notice or communication by telex or telecopy, on the
date when sent.
9. Joint and Several Obligations; Construction. If more than one Pledgor has
signed this Pledge Agreement, the obligations of the Pledgor are joint and
several. The term "Pledgor" and all pronouns referring thereto as used herein
shall be construed in the masculine, feminine, neuter or singular or plural as
the context may require.
10. Successors and Assigns. This Pledge Agreement shall inure to the benefit of
the Bank and its successors and assigns and shall bind the Pledgor and the
successors, representatives, legal representatives and/or heirs and assigns of
the Pledgor.
This Pledge Agreement has been executed by the Pledgor and the Bank as of the
day and date written hereinbelow.
PLEDGOR:
LOG ON AMERICA, INC.
/s/ Xxxxx Paolo
-------------------------------------------
By: Xxxxx Paolo, duly authorized and in his
capacity as President
Date: 8/10/99
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EXECUTED IN THE PRESENCE OF:
/s/ [ILLEGIBLE]
-------------------------------------------
Witness as to Pledgor
BANK:
FLEET NATIONAL BANK
By: /s/ [ILLEGIBLE]
---------------------------------------
Title: Senior Vice President
-------------------------------------
Date: 8/10/99
-------------------------------------
EXECUTED IN THE PRESENCE OF:
/s/ [ILLEGIBLE]
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Witness as to Bank
SEE EXHIBIT "A" ATTACHED HERETO, MADE A PART HEREOF AND INCORPORATED HEREIN BY
REFERENCE.
EXHIBIT A
(Description of Pledged Collateral)
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I. Securities and Closely Held Capital Stock (Corporate)
Issuer No. of Shares Certificate No. Cusip No.
------ ------------- --------------- ---------
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II. Securities (U.S. Government & Federal Agency Securities)
Par Issue Interest Maturity
Description Value Cusip No. Date Rate Date
----------- ----- --------- ---- ---- ----
US GOVT & AGENCY OBLIGATIONS, Market Value: $5,000,000.00*
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III. Certificates of Deposit
Issuer Par Value Interest Rate Maturity Date
------ --------- ------------- -------------
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IV. OTHER
THE COLLATERAL PLEDGED HEREIN SHALL BE HELD IN FLEET INVESTMENT MANAGEMENT
ACCOUNT NUMBER: ___________________________ (IN ITS ENTIRETY)*
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*OR ANY AND ALL SUBSTITUTIONS AND/OR ADDITIONS ACCEPTABLE TO THE BANK ON THE
BANK'S SOLE AND ABSOLUTE DISCRETION
THE COLLATERAL PLEDGED HEREIN IN THE SOLE NAME OF THE PLEDGOR, LOG ON AMERICA,
INC. SHALL BE HELD IN ITS ENTIRETY, IN FLEET INVESTMENT MANAGEMENT ACCOUNT
NUMBER: ________________
Pledgor's Initials:
Log On America, Inc.
/s/ [ILLEGIBLE]
-----------------
By: DP, President
Date: 8/11/99
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Joint Venture Agreements
1. See acquisition closing books
[LETTERHEAD OF FLEET]
August 4, 1999
Log On America, Inc.
Three Regency Plaza
Providence, Rhode Island 02903
Attention: Xxxxx Paolo, President
RE: $4,000,000.00 SECURED LINE OF CREDIT
Dear Mr. Paolo
Fleet National Bank, (the Bank) is pleased to offer its commitment to finance a
Secured Line of Credit pursuant to the terms and conditions detailed below:
BORROWER: Log On America, Inc. (a Delaware Corporation)
PLEDGOR: Log On America, Inc.
PRINCIPAL
AMOUNT: Four Million ($4,000,000.00) Dollars.
PURPOSE: Proceeds shall be used by the Borrower for working capital purposes
PRICING: A Fixed Rate of Interest equal to One (1) Month, Two (2) Month, Three
(3) Month or One (1) Year LIBOR plus One Hundred Fifty (150) Basis Points or,
the Bank's Floating Prime Rate of Interest.
MATURITY: Due and payable in full on August 15, 2001 (the "Maturity Date").
FEES: Waived.
REPAYMENT: Borrower shall be obligated to make and pay to the Bank interest
payments only, on a consecutive monthly basis. The entire principal balance plus
any and all accrued interest thereon and/or any and [ILLEGIBLE] other sums due
and payable pursuant to the terms and conditions contained in the promissory
note evidencing this loan shall be due and payable in full on the Maturity Date.
COLLATERAL: This loan shall be fully secured by various marketable securities
held in the sole name of the Pledgor, Log On America, Inc. Said marketable
securities are more particularly described and designated in that certain Pledge
Agreement executed in connection herewith, which marketable securities shall be
held in Fleet Investment Management Account Number: __________________________.
The collateral pledged herein shall remain in the Bank's possession at all
times.
OTHER TERMS AND CONDITIONS:
1. This commitment letter is subject to any specific due diligence and necessary
internal review by the Bank of pending items. Borrower/Pledgor shall execute any
and all documents as may be reasonably required by the Bank and/or its counsel
from time to time (including documentation required subsequent to closing) in
order to close and manage the within facility in order to fully protect the
Bank's interest hereunder.
2. All closing documents shall be in form and substance satisfactory to the Bank
and/or its counsel with such provisions as the Bank may reasonably require to
protect its interest.
If you wish to accept the terms and conditions of the facility detailed above,
please sign below and return the same to me within 30 days of the date of this
letter. This commitment is not assignable and will expire if it is not accepted
during the aforementioned time period. Additionally, this commitment is subject
to the Borrower's/Pledgor's execution of all required loan documentation
(including this letter) containing terms and conditions acceptable to the Bank
and/or its counsel. Please note that the closing must take place within 60 days
from the date of this letter. If you have any questions prior to the loan
closing, please feel free to call me at 000-000-0000. Thank you for choosing
Fleet National Bank.
Sincerely,
/s/ Xxxx Xxxxx
Xxxx Xxxxx, Senior Vice President
Agreed to and accepted by
BORROWER/PLEDGOR:
LOG ON AMERICA, INC.
/s/ Xxxxx Paolo
-------------------------------------------
By: Xxxxx Paolo, duly authorized and in his
capacity as President
Date: 8/10/99
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PROMISSORY NOTE
MAXIMUM PRINCIPAL AMOUNT
$4,000,000.00
1. BORROWER: LOG ON AMERICA, INC.
2. BORROWER'S ADDRESS: Three Xxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxx Xxxxxx 00000.
3. BANK: FLEET NATIONAL BANK
4. BANK'S ADDRESS: 000 Xxxxxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxx Xxxxxx 00000.
5. INTEREST RATE: Shall mean One (1) Month, Two (2) Month, Three (3) Month or
One (1) Year LIBOR (as defined herein) plus One Hundred Fifty (150) Basis Points
or the Bank's Floating Prime Rate of Interest (as defined herein) to be elected
by the Borrower at the time each advance is made. With respect to each LIBOR
advance, no Interest Period applicable thereto shall extend beyond the Maturity
Date provided for herein and provided, further, that if prior to the end of any
such Interest Period (and within the time set forth herein) the Borrower and the
Bank fail to agree upon a new Interest Period therefor so as to maintain such
advance as a LIBOR advance, such LIBOR advance shall automatically be converted
to the Bank's Floating Prime Rate of Interest plus Zero Percent at the end of
such interest period and shall be maintained as such until a new LIBOR rate and
a new interest period therefor is agreed upon.
Loan Requests: Requests for LIBOR loans and for interest period subsequent to
the initial interest period therefor shall be made not less than two (2)
business days prior to the first day of each interest period applicable thereto.
Requests for Prime Rate loans may be made up until 1:00 p.m. on the date the
loan is to be made. Any request for a loan may be written or oral, but if oral,
written confirmation thereof must be received by the Bank within three (3)
business days thereafter.
6. PAYMENT SCHEDULE:
Interest: Commencing on the 10 day of September, 1999 and continuing on the same
date of each and every consecutive month thereafter, and until payment in full
of this Note, monthly payments of Interest only in arrears shall be due and
payable.
Principal: The entire principal balance shall be due and payable in full on the
Maturity Date (as defined herein). The final payment shall consist of the entire
balance of the funds due to the Bank whether for principal, interest, and/or any
and all other sums due and payable pursuant to the terms and conditions
contained herein.
7. MATURITY DATE: Each reference in this Note to the "Maturity Date" shall mean
AUGUST 15, 2001.
8. CHOICE OF LAW/BINDING EFFECT: This Note shall be construed in accordance with
and governed by the local laws including the conflict of laws rules, so-called)
of the State of Rhode Island.
9. SCHEDULE "A": Each reference made to Schedule "A" shall mean Schedule "A"
attached hereto made a part hereof and incorporated herein by reference. This
Note shall be subject to the terms and conditions set forth in said Schedule "A"
attached hereto.
10. LOAN AGREEMENT: That certain Pledge Agreement relating to the indebtedness
of the Borrower as evidenced hereby.
11. PROMISE TO PAY: FOR VALUE RECEIVED, the Borrower absolutely and
unconditionally promises to pay to the Bank, its assigns or order, on or before
the Maturity Date, the Maximum Principal Amount or, if less, the aggregate
unpaid principal amount of advances made by the Bank to the Borrower in
accordance with the terms and conditions contained herein, together with
interest in accordance with the Payment Schedule and at the Interest Rate on the
unpaid principal balance hereof from time to time outstanding. Notwithstanding
the foregoing, from and after demand and/or maturity, (including any accelerated
maturity), after judgment has been rendered on this Note, and/or from and after
any Event of Default (as defined herein), the entire principal balance plus any
and all other amounts outstanding and due and payable under this Note shall
bear interest at the rate of Four Percent (4.00%) per annum greater than the
applicable interest rate due and payable hereunder or up to the Maximum Interest
Rate allowable under applicable law until paid in full or until any event of
default has been fully cured in the sole and absolute discretion of the Bank. In
addition, Borrower's right to select pricing options as provided for hereunder
shall immediately cease. All interest payable hereunder shall be computed on the
basis of the actual number of days elapsed using a three hundred sixty (360) day
year.
12. MAXIMUM RATE OF INTEREST: All provisions of this Note are expressly subject
to the condition that in no event shall the amount paid or agreed to be paid to
the Bank hereunder and deemed interest under applicable law exceed the maximum
rate of interest on the unpaid principal balance of this Note allowed by
applicable law (the "Maximum Allowable Rate"), which shall mean the law in
effect as of the date of the execution of this Note, except that if there is a
change in such law which results in a higher Maximum Allowable Rate being
applicable to this Note, then this Note shall be governed by such amended law
from and after its effective date. In the event that fulfillment of any
provision of this Note results in the interest rate hereunder being in excess of
the Maximum Allowable Rate, the obligation to be fulfilled shall automatically
be reduced to eliminate such excess. If, notwithstanding the foregoing, the Bank
receives an amount which under applicable law would cause the interest rate set
forth in this Note to exceed the Maximum Allowable Rate, the portion thereof
which would be excessive shall automatically be applied to and deemed a
prepayment of the unpaid principal balance of the Note and not a payment of
interest.
13. ADVANCES: So long as the Borrower is not in default pursuant to the terms
and conditions of this Note and/or any and all other documents or security
instruments which may in any way evidence, govern and/or secure this Note, the
Bank agrees to make advances to the Borrower until the maturity date provided
for herein or until the Bank's decision to collect the balance due hereunder,
whether upon demand, maturity, or availability of the Bank's commitment or upon
the occurrence of any Event of Default (as defined herein), provided, however,
that the aggregate principal amount of this Note does not exceed the maximum
permissible amount hereunder (as indicated on page one). If any advance is made,
the Bank may, at its option, record on the books and records of the Bank and
make an appropriate notation evidencing any such advance, each repayment on
account of the principal thereof, and the amount of interest paid. The Borrower
authorizes the Bank to maintain such records or make such notations and agrees
that the amount indicated on the books and records of the Bank as outstanding
from time to time shall constitute the amount owing to the Bank pursuant to this
Note. In the event of any conflict with the amount due and payable hereunder
pursuant to the books and records of the Bank, the books and records of the Bank
shall control any such disposition of the conflict absent manifest error. If for
any reason the outstanding principal balance of this Note should at any time
exceed the maximum permissible amount allowable hereunder, then in said event,
the Borrower shall, forthwith, and without demand [ILLEGIBLE]ny type,
immediately pay to the Bank an amount sufficient to reduce the outstanding
principal balance of this Note to the maximum amount permissible hereunder.
Failure to reduce the amount shall constitute an immediate event of default
hereunder.
Within the maximum permissible amount allowable hereunder and until demand
and/or maturity, the Borrower may borrow, repay and reborrow in accordance with
the terms and conditions contained herein. The Borrower shall access this line
of credit by a telephonic request for an advance, which will be disbursed to the
Borrower's demand deposit checking account with the Bank. LIBOR Advances
hereunder shall be in the minimum amount of Twenty Five Thousand ($25,000.00)
Dollars. Prime Rate advances hereunder shall be in the minimum amount of Ten
Thousand ($10,000.00) Dollars The Borrower accepts all risks inherent in such
requests for advances. The Borrower hereby absolves and indemnifies the Bank
from and against any and all damages, loss and liabilities of any nature
whatsoever which may result from an unauthorized telephonic request, a defective
transmission, or a telephonic request which is misunderstood by any Bank
employee. The Bank nor any of its directors, officers or employees shall be
under any duty to pass upon the validity, accuracy, authorization, effectiveness
or genuineness of any telephone request, and the Bank and its directors,
officers and employees shall be entitled to assume that any such telephonic
instructions are valid, effective, accurate, genuine and authorized. The
Borrower consents to the Bank's taping and recording of all telephonic
conversations relating to any such advances. Advances hereunder will be made
only if in the sole and absolute discretion and [ILLEGIBLE]on of the Bank there
has been no material adverse change in the financial condition or circumstances
of the Borrower.
14. PAYMENT PROVISIONS: All sums payable hereunder shall be payable in lawful
money of the United States of America and in immediately available funds at the
Bank's Address or at such other place or places as the Bank, its successors
and/or assigns (collectively the "Holder") may designate in writing. If this
Note or any payment hereunder becomes due on a Saturday, Sunday or other holiday
on which the Bank is authorized to close, the due date of this Note or payment
shall be extended to the next succeeding business day, but any interest or fees
shall be calculated based upon the actual time of payment. Each Note payment
(other than final payment in full of the Note) made by check drawn on a bank
other than the Bank shall be credited to the Note on the business day that funds
are deemed to be available under applicable federal law.
15. LIBOR: Each reference in this Note to LIBOR shall mean, as applicable to any
LIBOR Advance, the rate per annum (rounded upward, if necessary, to the nearest
1/32 of one percent) as determined on the basis of the offered rates for
deposits in U.S. dollars for a period of time comparable to such LIBOR Advance
which appears on the Telerate page 3750 as of 11:00 a.m. London time on the day
that is two (2) London Banking Days preceding the first day of such LIBOR
Advance; provided, however, if the rate described above does not appear on the
Telerate System on any applicable interest determination date, the LIBOR rate
shall be the rate (rounded upwards as described above, if necessary) for
deposits in dollars for a period substantially equal to the interest period on
the Reuters Page "LIBO" (or such other page as may replace the LIBO Page on that
service for the purpose of displaying such rates), as of 11:00 a.m. (London
Time), on the day that is two (2) London Business Days prior to the beginning of
such interest period. "Banking Day" shall mean in respect to any city any date
on which commercial banks are open for business in that city. If both the
Telerate and Reuters system are unavailable, then the rate for that date will be
determined on the basis of the offered rates for deposits in U.S. dollars for a
period of time comparable to such LIBOR Advance which are offered by four major
banks in the London interbank market at approximately 11:00 a.m. London time, on
the day that is two (2) London Banking Days preceding the first day of such
LIBOR advance as selected by the Calculation Agent. The principal London office
of each of the four major London banks will be requested to provide a quotation
of its U.S. dollar deposit offered rate. If at least two such quotations are
provided, the rate for that date will be the arithmetic mean of the quotations.
If fewer than two quotations are provided as requested, the rate for that date
will be determined on the basis of the rates quoted for loans in U.S. dollars to
leading European banks for a period of time comparable to such LIBOR Advance
offered by major banks in New York City at approximately 11:00 a.m. New York
City time, on the day that is two (2) London Banking Days preceding the first
day of such LIBOR Advance. In the event that the Bank is unable to obtain any
such quotation as provided above, it will be deemed that LIBOR pursuant to a
LIBOR Advance cannot be determined. In the event that the Board of Governors of
the Federal Reserve System shall impose a Reserve Percentage with respect to
LIBOR deposits of the Bank, then for any period during which such Reserve
Percentage shall apply LIBOR shall be equal to the amount determined above
divided by an amount equal to one minus the Reserve Percentage. The "Interest
Period" referred to herein shall mean that the period selected by the Borrower,
within the limitations contained in this Note, during which a LIBOR Advance may
bear interest at the LIBOR Rate plus the margin referred to herein.
Prepayment of LIBOR Loans: The Borrower hereby indemnifies [ILLEGIBLE]e Bank
from and against any and all losses or expenses which the Bank may sustain or
incur as a consequence of the following: (a) the receipt or recovery by the
Bank, whether by acceleration or otherwise, of all or any part of a LIBOR
advance prior to the last day of an interest period applicable thereto; or; (b)
the conversion, prior to the last day of an applicable Interest Period into a
Prime Rate loan; or (c) the failure of the Borrower to borrow any LIBOR advance
after agreement shall have been reached with respect to the amount, interest
rate thereon and the Interest Period therefor. Without limiting the effect of
the foregoing, the amount to be paid by the Borrower to the Bank in order to so
indemnify the Bank for any loss occasioned by any of the events described
herein, and as liquidated damages therefor, shall be equal to the excess,
discounted to its present value as of the date paid to the Bank, of (i) the
amount of interest which otherwise would have accrued on the principal amount so
received, recovered, converted or not borrowed during the period (the "Indemnity
Period") commencing with the date of such receipt, recovery, conversion or
failure to borrow to the last day of the then applicable Interest Period for
such LIBOR advance at the rate of interest applicable to such Advance (or the
rate of interest agreed to in the case of a failure to borrow) provided for
herein (prior to default) over (ii) the amount of interest which would be earned
by the Bank during the Indemnify Period if it invested the principal amount so
received, recovered, converted or not borrowed at a rate per annum determined by
the Bank as the rate it would bid in the London interbank market for a deposit
of eurodollars in an amount approximately equal to such principal amount for a
period of time comparable to the Indemnity Period. For the purposes of this
Section, [ILLEGIBLE] determination by the Bank of such losses and reasonable
expenses shall be conclusive if made reasonably and in good faith. A certificate
as to any additional amounts payable pursuant to this section setting for the
basis and method of determining such amounts shall be conclusive, absent
manifest error, as to the determination by the Bank set forth therein if made
reasonably and in good faith. The Borrower shall pay any and all amounts so
certified to it by the Bank within ten (10) days of receipt of any such
certificate. The indemnities set forth herein shall survive payment in full of
all LIBOR loans and all other loans made pursuant to this Note.
Increased Costs: If the Bank determines that the effect of any applicable law or
government regulation, guideline or order or the interpretation thereof by any
governmental authority charged with the administration thereof (such as, for
example, a change in official reserve requirements which the Bank is required to
maintain in respect of loans or deposits or other funds procured for funding
such loans) is to increase the cost to the Bank of making or continuing LIBOR
advances hereunder or to reduce the amount of any payment of principal or
interest receivable by the Bank thereon, then the Borrower shall pay to the Bank
on demand such additional amounts as the Bank may determine in its sole and
absolute discretion, to be required to compensate the Bank for such additional
costs or reduction. Any additional payment under this section will be computed
from the effective date at which such additional costs have to be borne by the
Bank. A certificate as to any additional amounts payable pursuant to this
section setting forth the basis and method of determining such amounts shall be
conclusive, absent manifest error, as to the determination by the Bank set forth
therein if made [ILLEGIBLE]ablv and in good faith. The Borrower shall pay any
and all amounts so certified to it by the Bank within ten (10) days of receipt
of such certificate.
Alternate Rate of Interest: In the event, and on each occasion, that on the day
two (2) Business Days prior to the commencement of any Interest Period for a
LIBOR advance, the Bank shall have determined (i) that dollar deposits in the
amount of the requested principal amount of such LIBOR advance are not generally
available in the London interbank market, (ii) that the rate at which such
dollar deposits are being offered will not adequately and fairly reflect the
cost to the Bank of making or maintaining such LIBOR advance during such
Interest Period, or (iii) that reasonable means do not exist for ascertaining
the LIBOR Rate, the Bank shall, as soon as practicable thereafter, give written
notice or telex notice of such determination to the Borrower. In the event of
any such determination, until the circumstances giving rise to such notice no
longer exist, no LIBOR advances will be made hereunder. Each determination by
the Bank hereunder shall be conclusive absent manifest error.
Change in Legality: Notwithstanding anything to the contrary contained herein,
if any change in any law or regulation or with the administration or
interpretation thereof shall make it unlawful for the Bank to make or maintain
any LIBOR advance, then, by written notice to the Borrower, the Bank may: (i)
declare that LIBOR advances will not thereafter be made by the Bank hereunder,
whereupon the Borrower shall be prohibited from requesting LIBOR advances from
the Bank hereunder unless such declaration is subsequently withdrawn; and (ii)
require that all outstanding LIBOR advances made by it be converted to Prime
Rate loans, in which event (x) all such LIBOR advances shall be automatically
converted into Prime Rate loans as of the effective date of such notice as
provided for herein and (y) all payments and prepayments of principal which
would otherwise be applied to repay the converted LIBOR advances shall instead
be applied to repay the Prime Rate loans resulting from the conversion of such
LIBOR advances. For purposes of this section, a notice to the Borrower by the
Bank shall be effective on the day of receipt by the Borrower.
16. PRIME RATE: Each reference in this Note to the "Prime Rate" shall mean the
prime rate of interest designated from time to time by the Bank as being its
"prime rate" of interest, such interest rate to change on the effective date of
each change in the Prime Rate.
17. REPRESENTATIONS, WARRANTIES & COVENANTS: (a) if the Borrower is a
corporation, limited liability company, partnership, limited liability
partnership, trust or any other legal entity recognized under applicable law, it
is duly organized and validly existing; if a corporation, the Borrower is in
good standing under the laws of its jurisdiction or organization; if a
partnership, trust or other legal entity, the Borrower has filed in all
locations required under the laws of each state in which it does business; (b)
the Borrower is qualified to do business in every state in which the nature of
its business conducted or the character of its property owned in such state
would require such qualification; (c) the Borrower has the power to execute,
deliver and perform this Note and to borrow from the Bank; (d) the execution,
delivery and performance of this Note and/or any other agreements, security
instruments or documents which may in any way evidence, govern and/or secure
this Note have been duly authorized and will not violate the articles of
organization, certificate of incorporation, partnership agreement, bylaws,
operating agreement, declaration of trust or other similar organization
documents or any law, regulation or court order and will not result in a default
under any agreement or indenture to which the Borrower is or hereafter made a
part of or bound by in any manner whatsoever, (e) there is no suit or
proceeding at law or in equity affecting the Borrower or any of its properties
or assets which, if adversely determined, would materially impair the assets,
liabilities, financial condition or business of the Borrower; (f) the Borrower
has filed all federal, state and local tax returns and any other reports it is
required to file by law and has paid all taxes and other charges and assessments
that are due and payable; (g) The Borrower has furnished to the Bank such tax
returns, financial statements and other information about the Borrower's
financial condition as the Bank shall have requested, which tax returns,
financial statements and other information fairly and accurately represent the
financial condition of the Borrower, and since the date of the last financial
statements delivered to the Bank, there has been no material adverse change in
the assets, liabilities, financial condition or business of the Borrower; (h) no
Event of Default (as determined herein) has occurred and no event has occurred
or is continuing which, with the giving of notice or lapse of time or both,
would constitute an Event of Default; (i) all of the information, documents and
instruments furnished by the Borrower to the Bank and upon which the commitment
for this loan is based, including without limitation, financial statements, are
true, accurate, complete and without any material omissions of any nature
whatsoever and (j) the Borrower is now and shall continue to be in full and
complete compliance with any and all laws of the federal, state, county and
municipal laws, rules ordinances and regulations applicable to it, its business
and/or its properties or assets, including without limitation, any and all laws,
rules and regulations pertaining to or concerning the employment of labor,
employee benefits, public health, safety and any and all environmental laws of
any nature whatsoever whether now or hereafter in effect; (k) the Borrower shall
be obligated to keep all property of the Borrower, including without limitation,
all collateral securing the obligations of the Borrower to the Bank, insured
against risks of loss or damage by fire (including so-called extended coverage),
theft and such other casualties as the Bank may require, all in such amounts,
under such forms of policies and under such terms, for such periods and written
by such companies or underwriters as the Bank may approve with such insurance to
name the Bank, its successors and/or assigns as first loss payee and/or
mortgagee thereon; and (l) the Borrower shall maintain at all times a
satisfactory payment record with the Bank and with all other creditors of the
Borrower.
18. EVENTS OF DEFAULT/ACCELERATION: The Bank may, in its sole and absolute
discretion, accelerate the maturity hereof upon the occurrence of any Event of
Default hereunder, and/or any events of default described in any and all other
documents or security instruments which may in any way evidence, govern and/or
secure this Promissory Note. By way of example and not limitation, an Event of
Default hereunder shall include, but not be limited to any of the following
events: (a) any representation or warranty made herein or in any report,
certificate, financial statement or any other instrument furnished in connection
with the loan made hereby shall prove to be false or misleading in any material
respect; (b) failure to pay the principal or any interest due and payable
pursuant to this Note or any other indebtedness of the Borrower or any Guarantor
to the Bank within ten (10) days from the date the same or any installment
thereof shall become due and payable, whether at the due date thereof or at a
date fixed for prepayment or by acceleration or otherwise; (c) involvement in
financial difficulties as evidenced by: (i) the appointment or authorization of
a custodian as defined in the Bankruptcy Code, provided, however, that in the
case of the appointment of a receiver in an involuntary proceeding and such
appointment continues in effect and undischarged for a period of thirty (30)
days; or (ii) the filing of an involuntary petition under any chapter of the
Bankruptcy Code or any Receivership Proceeding, which proceeding or petition
remains undismissed for a period of thirty (30) days; (d) any levy, seizure,
attachment, execution or similar process shall be issued or levied on or against
any of the Borrower's or Guarantor's properties or assets; (e) the Bank believes
that any material adverse change in the assets, liabilities, financial condition
or business of the Borrower or any Guarantor has occurred since the date of any
financial statements delivered to the Bank before or after the date of the
execution of this Note; (f) call upon the Borrower for payment of any contingent
debt which would materially affect the Bank's position with regard to the
collateral pledged for this loan; (g) sale or other disposition of or
encumbrance on any property of the Borrower or any Guarantor, except as
permitted hereby or by any agreement, document or instrument which may in any
way evidence, govern and/or secure this Note; (h) assignment for the benefit of
creditors by, or the commencement of any case or any other proceeding (whether
for the purpose of liquidation or rehabilitation or otherwise) under any
bankruptcy or insolvency laws or the death of, by or against Borrower or of, by
or against any Guarantor; (i) the Bank in good faith believes that the prospect
of payment or performance is impaired; (j) participation in any illegal activity
or in any activity, whether or not related to the business of the Borrower or
any Guarantor that may subject the assets of the Borrower or Guarantor to a
restraining order or any form of injunction issued by any federal or state court
or any seizure, forfeiture or confiscation by any federal or state governmental
instrumentality; and (k) failure to comply with any and all terms and conditions
contained in any other document or security instrument which may in any way
evidence, govern and/or secure this Note. Upon the occurrence of any Event of
Default, the availability of advances hereunder shall, at the option of the
Bank, be deemed to be automatically terminated and the Bank, at its sole and
absolute discretion, may declare all advances outstanding hereunder, together
with any and all accrued interest thereon and all applicable late charges and
all other liabilities or obligations of the Borrower and/or any Guarantor to the
Bank to be forthwith due and payable without presentment or demand for payment,
notice of non-payment, protest or any other notice or demand of any type or
kind, all of which are hereby expressly waived by the Borrower and/or any
Guarantor.
19. LATE FEES: If the entire amount of any required principal and/or interest is
not paid in full within ten (10) days after the same is due, the Borrower shall
pay to the Bank a late fee equal to five percent (5%) of the required payment.
If this Note is governed in accordance with the laws of the Commonwealth of
Massachusetts, such late fee shall be reduced to three (3%) percent of any
required principal and interest payment that is not paid within fifteen (15)
days of the date it is due if this Note is secured by a mortgage on an
owner-occupied residence, one to four (1-4) units. If this Note is governed in
accordance with the laws of New York, such late fee shall be reduced to two (2%)
percent of any required principal and interest payment that is not paid within
fifteen (15) days of the date it is due if this Note is secured by a mortgage on
an owner-occupied residence, one to six (1-6) units.
20. FEES AND EXPENSES: The Borrower shall be obligated to pay any and all
expenses, fees and/or costs incurred by the Bank in connection with the
preparation of the loan documents, the making of the loan evidenced by this
Note, and the enforcement of the rights of the Bank in connection with this Note
and the loan documents and
security instruments including, but not limited to, all reasonable fees
[ILLEGIBLE] its counsel (which may include costs allocated by the Bank's
internal legal department) plus the disbursements of said counsel. The Borrower
shall be further obligated to pay to the Bank on demand all reasonable fees,
costs and expenses incurred by the Bank in connection with the collection,
enforcement and/or administration of the loan evidenced hereby which shall
include, without limitation, any and all overnight courier fees, lien search
fees, and filing and recording fees.
21. LIEN AND SET OFF: The Borrower and/or any Guarantor hereby grant the Bank a
lien, security interest and right of setoff for all liabilities and obligations
to the Bank, whether now existing or hereafter arising, upon and against all
deposits, credits, collateral and property now or hereafter in the possession,
custody, safekeeping or control of the Bank or any entity under the control of
Fleet Financial Group, Inc. or in transit to any of them. At any time after an
event of default, without demand or notice, Bank may set off the same or any
part thereof and apply the same to any liability or obligation of the Borrower
and any Guarantor even though unmatured and regardless of the adequacy of any
other collateral securing this Note. Any and all rights to require the Bank to
exercise its rights or remedies with respect to any other collateral which
secures this Note, prior to exercising its right of set off with respect to such
deposits, credits or other property of the Borrower or any Guarantor are hereby
knowingly, voluntarily and irrevocably waived.
22. WAIVERS: THE BORROWER AND/OR ANY GUARANTOR EXPRESSLY WAIVES PRESENTMENT,
DEMAND, NOTICE OF DISHONOR, PROTEST AND NOTICE OF NON-PAYMENT. WITH RESPECT TO
ANY PREJUDGMENT REMEDY WAIVER, THE BORROWER AND EACH GUARANTOR HEREBY
ACKNOWLEDGE THAT TO THE EXTENT THAT THE TRANSACTION OF WHICH THIS NOTE IS A PART
OF A COMMERCIAL TRANSACTION AND, TO THE EXTENT PERMITTED BY ANY STATE OR FEDERAL
LAW, BORROWER AND EACH GUARANTOR HEREBY WAIVE THE RIGHT ANY OF THEM MAY HAVE TO
PRIOR NOTICE OF AND A HEARING ON THE RIGHT OF THE BANK TO ANY REMEDY OR
COMBINATION OF REMEDIES THAT ENABLES SAID BANK, BY WAY OF ATTACHMENT, FOREIGN
ATTACHMENT, GARNISHMENT OR REPLEVIN, TO DEPRIVE BORROWER OR ANY GUARANTOR OF, OR
AFFECT THE USE, POSSESSION OR ENJOYMENT BY BORROWER OR ANY GUARANTOR OF ANY OF
THEIR PROPERTY, AT ANY TIME PRIOR TO JUDGMENT IN ANY LITIGATION OR ARBITRATION
INSTITUTED IN CONNECTION WITH THIS NOTE OR THE TRANSACTION OF WHICH THIS NOTE IS
A PART. IN ADDITION HERETO, THE BANK BORROWER AND EACH GUARANTOR MUTUALLY
HEREBY KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY
JURY IN RESPECT TO ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN
CONNECTION WITH THIS NOTE OR ANY OTHER LOAN DOCUMENTS OR SECURITY INSTRUMENTS
CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH OR ANY COURSE OF CONDUCT,
COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY
PARTY. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR THE BANK TO ACCEPT THIS
NOTE AND MAKE THE LOAN.
23. JOINT AND SEVERAL OBLIGATIONS /UNENFORCEABILITY: If this Note is executed by
more than one Borrower, then in said event, the obligations created herein shall
be the joint and several obligations and liability of each Borrower and each
Guarantor and each provision of this Note shall apply to each and all jointly
and severally and to the property and liabilities of each and all, each of whom
hereby waive presentment for the payment, protest and notice of dishonor, and
who hereby agree to any extension or delay in the time for payment or
enforcement, to renewal of this Note and to any substitution or release of any
collateral, all without notice and without any effect on their liabilities. Any
delay on the part of the Bank hereof in exercising any right hereunder or under
any other document or security instrument of any nature whatsoever which may
evidence, govern and/or secure this Note shall not operate as a waiver and any
waiver for one occasion shall not operate as a waiver in the event of any
subsequent default. The rights and remedies of the Bank hereof shall be
cumulative and not in the alternative and shall include all rights and remedies
granted herein or in any other document or security instrument which may in any
way evidence, govern and/or secure this Note under applicable law. In the event
that any term or provision of this Note or the application thereof to any person
or circumstance shall, to any extent, be held invalid or unenforceable, the
remainder of this Note or the application of such term or provision to persons
or circumstances other than those to which it is held invalid or unenforceable,
shall be valid and enforceable to the fullest extent permitted by law.
24. MISCELLANEOUS PROVISIONS: (a) Pledge to the Federal Reserve: the Bank may at
any time pledge all or any portion of its rights under the loan documents
including any portion of this Note to any of the twelve (12) Federal Reserve
Banks organized under Section 4 of the Federal Reserve Act, 12 U.S.C. Section
341. No such pledge or enforcement thereof shall release Bank from its
obligations under any of the loan documents. The Bank shall have the
unrestricted right at any time and from time to time, and without the consent of
or notice to Borrower or any Guarantor to grant to one or more banks or other
financial institutions (each, a "Participant") participating interests in the
Bank's obligation to lend hereunder and/or any or all of the loans held by the
Bank hereunder. In the event of any such grant by the Bank of a participating
interest to a Participant, whether or not upon notice to the Borrower or any
Guarantor, the Bank will remain responsible for the performance of its
obligations hereunder and Borrower and any Guarantor shall continue to deal
solely and directly with the Bank in connection with the Bank's rights and
obligations hereunder. The Borrower shall not be permitted to assign any of the
obligations contained in this Note. The Bank may furnish any information
concerning Borrower or any Guarantor in its possession from time to time to
prospective Assignees and Participants, provided that the Bank shall require any
such prospective Assignee or Participant to agree in writing to maintain the
confidentiality of such information; (b) Replacement Note: upon receipt of an
affidavit of an officer of the Bank as to the loss, theft, destruction or
mutilation of this Note or any other document or security instrument which is
not of public record, and in the case of any such loss, theft, destruction or
mutilation, upon surrender and cancellation of such Note or other document or
security instrument, the Borrower and/or any Guarantor or Obligor as the case
may be, shall be obligated to issue, in lieu thereof, a replacement Note or
other
document or security instrument in the same principal amount thereof and
otherwise of like tenor, (c) References: each reference herein to the Bank shall
be deemed to include its successors and/or assigns and each reference to the
Borrower and/or any Guarantor and any pronouns referring thereto as used herein
shall be construed in the masculine, feminine, neuter, singular or plural as the
context may require and shall be deemed to include the heirs, executors,
administrators, legal representatives, successors and/or assigns of the Borrower
and/or any Guarantor, all of whom shall be bound by each of the provisions
contained in this Note.
IN WITNESS WHEREOF, the undersigned Borrower, duly authorized, has executed,
sealed and delivered this instrument as a sealed instrument as of the day and
date written hereinbelow.
BORROWER:
LOG ON AMERICA, INC.
/s/ Xxxxx Paolo
---------------------------------------
By: Xxxxx Paolo, duly authorized and in
his capacity as President
Date: 8/10/99
-------
EXECUTED IN THE PRESENCE OF:
/s/ [ILLEGIBLE]
---------------------------------------
Witness as to Borrower
[LOGO] FLEET
SCHEDULE "A"
This Schedule "A" is attached to the Promissory Note dated ________________
(specify date of execution of the Note) and constitutes an integral part of said
Promissory Note and is incorporated herein by reference, as if all terms and
conditions set forth herein were fully and completely set forth at length in
said Promissory Note. The terms and conditions contained in this Schedule "A"
and all covenants, agreements, representations and/or warranties made herein
shall survive the closing of this loan. The execution and delivery of any and
all loan documents or security instruments which may in any way evidence, govern
and/or secure this Note shall continue to remain in full force and effect until
any and all obligations created herein have been fully and completely satisfied
in the sole and absolute discretion of the Bank. Any modifications to this Note
and/or any modifications to any of the loan documents and/or security
instruments which may in any way evidence, govern and/or secure this Note shall
be reduced to writing and executed in form and substance acceptable to the Bank.
In addition, whenever the context so requires, any reference in this Schedule
"A" to the neuter gender shall include the masculine and/or feminine gender, and
the singular number shall include the plural and in each case, vice versa. If
this Schedule "A" is executed, initialed and/or dated by more than one Borrower,
then in said event, the obligations created herein shall be the joint and
several obligations and liability of each of the parties executing, and/or
initialing this Schedule "A".
This loan shall be fully secured by various marketable securities more
particularly described and designated in that certain Pledge Agreement executed
in connection herewith. The collateral pledged herein is held in the sole name
of the Pledgor for this loan, Log On America, Inc. and shall be held in Fleet
Investment Management Account Number: _____________________. The collateral
pledged herein shall remain in the Bank's possession at all times. The advance
rate shall not exceed 70% of NYSE and AMEX listed stocks and bonds, 70% of
stocks traded on other major exchanges acceptable to the Bank, 80% of the value
of investment grade municipal bonds, and 90% of the value of U.S. Treasury
obligations. Stocks traded at less than $10.00 per share as well as Fleet
Financial Group, Inc. stock shall not be considered eligible collateral for this
loan. If at any time the value of the collateral does not meet the
above-mentioned loan to value requirements, then this loan shall be reduced or
additional liquid collateral, acceptable to the Bank, shall be pledged to meet
the requisite loan to value guidelines. Failure to do so within two (2) business
days shall constitute an immediate event of default. Shares that fall below
$10.00 per share and bonds which fall below investment grade will be excluded
from the collateral pool.
BORROWER'S INITIALS:
Log on America ,Inc.
/s/ [ILLEGIBLE]
-----------------
By: DP, President
Date: 8/10/99
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