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Exhibit 10.8
Fleet Bank Term Loan Agreement
For value received and in further consideration of the granting by Fleet Bank of
Massachusetts, National Association ("Bank") to the undersigned ("Borrower") of
a line of credit or of a loan or loans thereunder (all such loans, together with
any existing loans from Bank to Borrower, being hereinafter collectively and
separately referred to as the "Loan"), Borrower represents and warrants to and
agrees with the Bank as follows ("Agreement"):
SECTION 1. THE LOAN
1.1 AMOUNT. Bank will lend to Borrower, and Borrower will borrow from
Bank $750,000.00 with interest at Prime+1/2% per annum.
1.2 EVIDENCE OF LOAN. At the option of Bank, the Loan and the terms of
repayment thereof, including the rate of interest, may be evidenced
by a note or notes, or by Bank's books and records.
1.3 SECURITY AND/OR GUARANTY. The payment of the Loan may at any time or
from time to time be secured and/or guaranteed wholly or partly
separate and apart from this Agreement, but whether or not secured
and/or guaranteed, all monies and other property at any time in the
possession of Bank which Borrower either owns or has the permission
of the owner thereof to pledge with or otherwise hypothecate to
Bank, including, but not limited to, any deposits, balances of
deposits or other sums at any time credited by or due from Bank,
shall at all times be collateral security for all of the
liabilities, obligations and undertakings of Borrower to Bank,
direct or indirect, absolute or contingent, now existing or
hereafter arising or acquired including, but not limited to, the
payment of the Loan.
SECTION 2. WARRANTIES AND REPRESENTATIONS. Borrower hereby represents and
warrants to Bank (which representations and warranties will survive
the making of the Loan) that:
2.1 CORPORATE EXISTENCE. Borrower, if a corporation, is and will
continue to be, a corporation duly incorporated and validly existing
under the laws of the State of ________________ and duly licensed or
qualified as a foreign corporation in all states wherein the nature
of its property owned or business transacted by it makes such
licensing or qualification necessary. Borrower has obtained all
required permits, authorizations and licenses, without unusual
restrictions or limitations, to conduct the
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business in which Borrower is presently engaged, all of which are in
full force and effect.
2.2 CORPORATE AUTHORITY AND POWER. If Borrower is a corporation, the
execution, delivery and performance of this Agreement, any note or
security agreement or any other instrument or document at any time
required in connections with the Loan are within the corporate
powers of Borrower, and not in contravention of law, the Articles of
Organization or By-Laws of Borrower or any amendment thereof, or of
any indenture, agreement or undertaking to which Borrower is a party
or may otherwise be bound, and each such instrument and document
represents a valid and binding obligation of Borrower and is fully
enforceable according to its terms. Borrower will, at the request of
Bank at any time and from time to time, furnish Bank with the
opinion of counsel for Borrower with respect to any or all of the
foregoing or other matters, such opinion to be in substance and form
satisfactory to Bank.
2.3 FINANCIAL STATUS. All financial statements and other statements
heretofore or hereafter given by Borrower to Bank in respect hereof
are or will be true and correct, subject to any limitation stated
therein, consistent with any prior statements furnished to Bank, and
prepared in accordance with generally accounting principles to
represent fairly the condition of Borrower at the date thereof.
2.4 LITIGATION. There is not now pending or threatened against Borrower
any action or other proceedings or any claim in which Borrower has
any monetary or other proprietary interest nor do any of the
executive or managing personnel of Borrower know of any facts which
may give rise to any such litigation, proceeding or claim,
except: ___________________________________________________________
___________________________________________________________________
_______________
2.5 SUBSIDIARIES AFFILIATES. If Borrower is a corporation it (a) owns
100% or N/A% of the issued stock of the following subsidiaries
and/or affiliates:
___________________________________________________________________
___________________________________________________________________
______________________________ (b) such stock shall be free and
clear of any pledges, liens, or other encumbrances.
2.6 EVENTS OF DEFAULT. No event of default specified in Section 5.0
hereof, and no event which, with the lapse of time or notice, would
become such an event of default, has occurred and is continuing.
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2.7 TITLE TO PROPERTY. Borrower has good and marketable title to all
property in which Borrower has given or has agreed to give a
security interest to Bank and such property is or will be free of
all encumbrances except: __________________________________________
___________________________________________________________________
2.8 TAXES. Borrower has filed all tax returns required to be filed, has
paid all taxes due thereon and has provided adequate reserves for
payment of any tax which is being contested.
SECTION 3. AFFIRMATIVE COVENANTS. Borrower agrees that until payment in
full of the Loan and performance of all of its other obligations under this
Agreement, Borrower will, unless Bank otherwise consents in writing, comply with
the following:
3.1 COMPENSATING BALANCES. Bank shall be Borrower's main bank of deposit
and Borrower shall maintain average aggregate collected balances in
its deposit account or accounts with Bank of not less that N/A per
centum (_____%) of the outstanding unpaid balance of the Loans, such
collected balances to be calculated net of any balances required to
support demand deposit account activity costs. Balances shall be
averaged _______________________________________________.
3.2 COMMITMENT FEE. Subject to the terms of this agreement Bank commits
itself until _______, 19___ to lend to Borrower at any time or from
time to time a sum or sums in the aggregate amount of $N/A and
Borrower agrees to pay to Bank monthly in arrears a fee for Bank's
said commitment in the amount of ______ per centum (________%) of
the unused portion thereof so long as the same be outstanding.
Borrower shall also, in addition to requirements of Paragraph 3.1
above, maintain collected balances in its deposit account or
accounts with Banks of not less than _______ per centum (________%)
of the unused portion of said commitment. Repayments on account of
the Loan shall not operate to increase the unused portion of said
commitment, except in the case of Revolving Loans.
3.3 FINANCIAL STATEMENTS. (a) Borrower will furnish to Bank quarterly
statements prepared by Borrower within forty-five days of the close
of each quarter, and within ninety days after the close of each
fiscal year, an annual audit prepared by the equity method and
certified by public accountants selected by Borrower and approved by
Bank, together with a certificate by such accountants that at such
audit date Borrower was acting in compliance with the terms of this
Agreement. If Borrower is a
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corporation, consolidated and consolidating statements shall be
furnished for Borrower and all subsidiary corporations, (b) Borrower
shall indicate on said statements all guarantees made by it and (c)
Borrower will upon request permit a representative of Bank to
inspect and make copies of Borrower's books and records at all
reasonable times.
3.4 INSURANCE. Borrower will maintain adequate fire insurance with
extended coverage, public liability and other insurance as Bank may
reasonably require as consistent with sound business practice and
with companies satisfactory to Bank, which policies will show the
Bank as a loss payee.
3.5 TAXES AND OTHER LIENS. Borrower will comply with all statutes and
government regulations and pay all taxes, assessments, governmental
charges or levies, or claims for labor, supplies, rent and other
obligations made against it which, if unpaid, might become a lien or
charge against Borrower or on its property, except liabilities being
contested in good faith and against which if requested by Bank.
Borrower will set up reserves satisfactory to Bank.
3.6 MAINTENANCE OF EXISTENCE. If Borrower is a corporation, it will
maintain its existence and comply with all applicable statutes,
rules and regulations, and maintain its properties in good operating
condition, and continue to conduct its business as presently
conducted.
3.7 NOTICE OF DEFAULT. Within three (3) business days of becoming aware
of (a) the existence of any condition or event which constitutes a
default under Section 5.0 hereof, or (b) the existence of any
condition or event which with notice or the passage of time, will
constitute a default under Section 5.0 hereof. Borrower will provide
Bank with written notice specifying the nature and period of
existence thereof and what action Borrower is taking or proposes to
take with respect thereto.
3.8 USE OF PROCEEDS. Borrower shall use the proceeds of the Loan
hereunder for general commercial purposes, provided that no part of
such proceeds will be used, for he purpose of purchasing or carrying
any "margin security" as such term is defined in Regulation U of the
Board of Governors of the Federal Reserve System.
3.9 FURTHER ASSURANCES. Borrower will execute and deliver to Bank any
writings and do all things necessary, effectual or reasonably
requested by Bank to carry into effect the provisions and intent of
this Agreement.
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SECTION 4. NEGATIVE COVENANTS. Without the prior written approval of Bank,
Borrower will not:
4.1 CONSOLIDATION, MERGER OR ACQUISITION. Participate in any merger or
consolidation or alter or amend the capital structure of Borrower
including, but not limited to, the issuance of additional stock, or
make any acquisition of the business of another.
4.2 DIVIDENDS. Pay any dividends, including stock dividends, or make any
distributions, in case or otherwise, including splits of any kind,
to any officer, stockholder or beneficial owner of Borrower other
than salaries.
4.3 ENCUMBRANCES. Mortgage, pledge or otherwise encumber any property of
Borrower or permit any lien to exist thereon except liens (i) for
taxes not delinquent or being contested in good faith; (ii) of
mechanics or materialmen in respect of obligations not overdue or
being contested in good faith; (iii) resulting form security
deposits made in the ordinary course of business; and (iv) in favor
of Bank.
4.4 INVESTMENTS. Invest any assets of Borrower in securities other than
obligations of the United States of America.
4.5 DISPOSITION OF ASSETS, GUARANTEES, LOANS, ADVANCES. Sell, transfer
or assign any assets of Borrower other than in the ordinary course
of business or, except as hereinafter specifically permitted, (i)
sell or transfer or assign any of Borrower's accounts receivable
with or without recourse, (ii) guarantee or become surety for the
obligations of any person, firm or corporation, or (iii) make any
loans or advances except _________________________________________.
4.6 WORKING CAPITAL. Permit its inventory to exceed ________% of its
Current Assets; permit its net Working Capital (excess of Current
Assets over Current Liabilities) to be less than $N/A for the
current fiscal year and for each subsequent fiscal year to be less
than the amount for the prior fiscal year plus ______% of Borrower's
net income earned for the prior plus __________% of Borrower's net
income earned for the prior year, after provision for taxes,
provided that there shall be no reduction in the required working
capital for losses; or permit its Current Assets to be less than
_______% of its Current Liabilities, Current Assets and Current
Liabilities to be computed in accordance with customary accounting
practice except that Current Liabilities shall in any event include
all rentals and other payments due within one year under any lease
or rental of personal property.
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4.7 LIABILITIES. Permit its total short and long term liabilities
including borrowings to exceed _______% of Borrower's tangible net
worth, said percentage to decrease N/A % per year for the term of
the Loan.
4.8 FIXED ASSETS. Make, or incur any obligation to make, any
expenditures in any fiscal year for fixed assets by purchase or
lease agreement the aggregate fair market value of which assets are
in excess of $ N/A .
4.9 COMPENSATION. If Borrower is a corporation, pay to its officers and
directors aggregate compensation in any fiscal year which exceeds
$N/A.
4.10 EMPLOYMENT RETIREMENT INVESTMENT SECURITY ACT OF 1974 AS AMENDED
("ERISA"). PERMIT ANY PENSION PLAN TO: (a) engage in any "prohibited
transaction"; (b) fail to report to Bank a "reportable event"; (c)
incur any "accumulated funding deficiency"; or (d) terminate its
existence at any time in a manner which could result in the
imposition of a lien on the property of the Borrower. (The quote
terms are defined in Sections 2003(c), 302 and 4003, respectively,
of ERISA.
SECTION 5. DEFAULTS. If any one or more of the following "Events of
Default" shall occur at any time, Bank shall have the right to declare any or
all liabilities or obligations of Borrower to Bank immediately due and payable
without notice or demand:
5.1 Any warranty, representation or statement made or furnished to Bank
by or on behalf of Borrower or any guarantor or surety for Borrower
was in any material respect false when made or furnished;
5.2 A failure to pay or perform when due any obligation, liability or
covenant of Borrower or of any guarantor or surety for Borrower,
under this loan agreement or any other indebtedness or obligation
for borrowed money, or if such indebtedness or obligation shall be
accelerated, or if there exists any event of default under any such
instrument, document or agreement evidencing or securing such
indebtedness or obligation, including, but not limited to, failure
to perform the terms of this Agreement or of the note or notes
evidencing the Loan;
5.3 The commencement of any proceeding under any bankruptcy or
insolvency laws by or against Borrower, the appointment of a
trustee, receiver or custodian and, if any such proceeding is
involuntary such proceeding has not been dismissed and all trustees,
receivers, or custodians discharged within 30 days of its
commencement or their
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appointment;
5.4 The service upon Bank of writ in which Bank is named as trustee or
Borrower or any guarantor or surety for Borrower;
5.5 If Borrower or any guarantor or surety for Borrower is a
corporation, trust or partnership, the liquidation, termination or
dissolution any such organization or its ceasing to carry on
actively its present business;
5.6 The death of Borrower or any guarantors or surety for Borrower, and
if Borrower or any guarantor or surety for Borrower is a
partnership, the death of any partner; or
5.7 A judgment or judgments for the payment of money aggregating in
excess of $100,000.00 is outstanding against Borrower or any
guarantor or surety for Borrower and any one of such judgments has
been outstanding for more than thirty (30) days from the date of its
entry and has not been discharged in full or stayed.
SECTION 6. MISCELLANEOUS
6.1 OTHER AGREEMENTS. This Agreement is supplementary to each and every
other agreement between Borrower and Bank and shall not be so
construed as to limit or otherwise derogate from any of the rights
or remedies of Bank or any of the liabilities, obligations or
undertakings of Borrower under any such agreement, nor shall any
contemporaneous or subsequent agreement between Borrower Bank be
construed to limit or otherwise derogate from any of the rights or
remedies of Bank or any of the liabilities, obligations or
undertakings or Borrower hereunder unless such other agreement
specifically refers to this Agreement and expressly so provides.
This Agreement and the covenants and agreements herein contained
shall continue in full force and effect and shall be applicable not
only with respect to the Loan, but also to all other obligations,
liabilities and undertakings of Borrower to Bank whether direct or
indirect, absolute or contingent, due or to become due, now existing
or hereafter arising or acquired, until all such obligations,
liabilities and undertakings have been paid or otherwise satisfied
in full.
6.2 WAIVERS. No delay or omission on the part of Bank in exercising any
right hereunder shall operate as a waiver of such right or any other
right and waiver on any one or more occasions shall not be construed
as a bar to or waiver of any right or remedy of Bank on any future
occasion.
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6.3 EXPENSES. Borrower will pay or reimburse Bank for all reasonable
expenses, including attorneys' fees, which Bank may in any way incur
in connection with this agreement or any other agreement between
Borrower and Bank or with any Loan or which result from any claim or
action by any third person against Bank which would not have been
asserted were it not for Bank's relationship with Borrower hereunder
or otherwise.
6.4 NOTICES. All notices and other communications hereunder shall be in
writing, except as otherwise provided in this Agreement, and shall
be hand delivered or mailed by first-class mail, postage prepared
(in which event notice shall be deemed to have been given when so
delivered or deposited in the mail), addressed (a) if to Borrower,
to XXX XXXXXXXXXX XXXXX, XXXXX 000, XXXXXXXXXX, XX 00000 and (b) if
to Bank, to 00 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention
XXXXXX X. XXXXXX. The address of any party hereto for such demands,
notices and other communications may be changed by giving notice in
writing at any time to the other party hereto.
6.5 MASSACHUSETTS LAW. This Agreement is intended to take effect as a
sealed instrument and shall be governed by and construed according
to the laws of the Commonwealth of Massachusetts.
6.6 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
Borrower's legal representatives, successors and assigns and will
inure to the benefit of Bank's successors and assigns.
6.7 ADDITIONAL PROVISIONS. Borrower furthermore agrees to the following
additional provisions: THE TERMS AND CONDITIONS CONTAINED IN THE
LETTER AGREEMENT OF EVEN DATE ARE INCORPORATED HEREIN.
IN WITNESS WHEREOF the parties hereto have caused this Agreement to be
duly executed under seal this _____________ day of ________________________,
19___, at Boston, Massachusetts.
/s/ Xxxxx Xxxxx
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(Name of Borrower)
By
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Hereunto duly authorized
Title:
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ATTEST:
/s/ Xxxx X. Xxxxx By
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Hereunto duly authorized
Title:
Fleet National Bank
By
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Hereunto duly authorized
Title:
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FLEET BANK COMMERCIAL PROMISSORY NOTE
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_________________, Massachusetts August 11, 1997
FOR VALUE RECEIVED, I, the undersigned promise to pay to the order of
Fleet National Bank (with any subsequent holder referred to in this note as
"you") at any of your offices, the sum of Seven Hundred Fifty Thousand and
00/100. _______________________ DOLLARS ($750,000.00) with interest in
accordance with the provisions below which are marked.
INTEREST RATE
I will pay interest on the unpaid principal balance of this Note as follows, but
in no event will interest exceed the maximum rate permitted by law:
X FLOATING RATE. At the aggregate of the Bank's Prime Rate as the Bank
announces it from time to time, plus one-half percent annum. Changes in
the Bank's Price Rate as the Bank announces it from time to time are to
take effect, for the purposes of the determination of interest on this
Note, when made effective generally to loans by the Bank.
[ ] FIXED RATE. At the rate of ________ percent per annum.
[ ] DISCOUNT. Interest to maturity has been deducted from the proceeds of
this Note, Interest at the rate of ________ percent per annum shall be
paid on any amount not paid when due hereunder until that amount and
any such interest are so paid.
INTEREST PAYMENTS
I will pay interest at the above rate as follows:
X PERIODICALLY Monthly/Quarterly/__________. In arrears, with the first
such payment due on the 1st day of September, 1997 and each subsequent
payment due on the corresponding day of each calendar month/calendar
quarter/ ____________________ thereafter.
[ ] AT MATURITY. At the maturity of this Note.
[ ] INTEREST INCLUDED IN REPAYMENTS. Interests included in the
payment(s) to be made pursuant to the Repayment Provisions below.
REPAYMENT PROVISIONS
In addition to any interest payments to be made as indicated above, I will pay
you the amount stated above as follows:
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[ ] ON DEMAND, On demand by you.
[ ] PAYMENTS TO BE MADE UNTIL DEMAND. On demand by you, with payments of
$__________ each to be made monthly unless and until such demand is
made monthly unless and until such demand is made. The first such
payments shall be due on the ____ day of ______ 19__ (if you have not
made demand before then) and unless and until you make demand, each
subsequent payment shall be due on the corresponding day of each month
thereafter.
[ ] TIME, ___________ days after the date hereof on _______________, 19__.
X INSTALLMENTS. In 36 consecutive monthly installments, of which each but
the last shall be $[ * ]and the final of which shall be equal to the
then unpaid principal balance of this Note plus all accrued and unpaid
interest thereon. ____ first such monthly Installment shall be due on
the 1st day of April, 1998 and each subsequent Installment shall be due
on the corresponding day of each month thereafter, with the balance of
all principal and interest due on March 1, 2001.
[ ] * 1/36th of the principal amount outstanding on March 31, 1998.
PREPAYMENT. I will be entitled to prepay this note as follows:
LATE CHARGES. 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
provided that such late fee shall be reduced to three percent (3%) of any
required principal and interest payment that is not paid within fifteen (15)
days of the date it is due if Agreement is secured by a mortgage on an
owner-occupied residence, 1-4 units.
APPLICATION OF PAYMENTS. Any payments you receive from me will be applied first
to any accrued and unpaid interest and then to the unpaid principal balance of
this Note. If any payment under this Note becomes due and payable on the day
upon which your office is legally closed to business, the due date shall be
extended to the next succeeding business day and interest shall be payable
during such extension at the rate stated above.
EACH BORROWER AND ENDORSER LIABLE. If more than one borrower has signed below,
each of us has made all of the promises contained in this Note, and we are
jointly and severally liable for all obligations on this Note. If one or more
endorser has signed below, each endorser agrees to all terms of this Note,
including without limitation the provisions relating to Security.
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This Note is subject to the terms, provisions and conditions set forth
on the reverse side of this page. Signed as an instrument under seal on the date
stated above.
BORROWER(S)
Silverstream Software, Inc.
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Name of Borrower
By: /s/ Xxxxx Xxxxx
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Name
Title
By:
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Name
Title
Address: One Burlington Xxxxx, Suite 200
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Xxxxxxxxxx, XX 00000
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Name of Borrower
By:
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Name
Title
Address:
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ENDORSER(S):
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