EXHIBIT 10.8
LOAN AND SECURITY AGREEMENT
This Loan and Security Agreement (as amended hereafter, this
"Agreement") is entered into as of MARCH 9, 2004 and confirms the understanding
and agreement by and between BFI BUSINESS FINANCE, a California corporation
("Lender"), with an address at 0000 Xxx Xxxxxxx, Xxx Xxxx, Xxxxxxxxxx 00000 and
ALPHA INNOTECH CORPORATION, a(n) CALIFORNIA CORPORATION ("Borrower") regarding
the loan to be made by Lender and Lender's terms and conditions.
RECITALS
A. Borrower has requested Lender to make loans to Borrower for
business purposes.
B. Lender is willing to make such loans to Borrower, on the terms
and conditions set forth in the Agreement, and Borrower agrees to make the
payments required by this Agreement and to comply with the other terms and
conditions of this Agreement.
AGREEMENT
1. Lender shall from time to time in Lender's sole discretion
advance sums to Borrower up to EIGHTY PERCENT (80%) of the Net Face Amount of
Prime Accounts (as defined below in Paragraph 6) and such other sums as Lender
may determine (each, an "Advance" and collectively, "Advances"), but in no event
shall the aggregate indebtedness (under this Agreement or under all Obligations)
to Lender at any one time exceed without Lender's prior written approval, the
sum of ONE MILLION AND 00/100 DOLLARS ($1,000,000.00) (the "Maximum Amount"). In
the event that the balance owing under this Agreement exceeds the Maximum
Amount, or in the event that said balance exceeds the percentage set forth above
of the Value of Prime Accounts as determined by Lender, Borrower understands and
agrees that Lender shall make no further Advances to the Borrower unless and
until Borrower pays Lender the amount of such excess (each an "Overadvance"),
and Borrower hereby promises to pay the Overadvance to Lender upon Lender's
demand.
2. Each Advance and Borrower's total indebtedness to Lender shall
be paid by Borrower as follows: (a) the delivery to Lender of all collections
received by Borrower on Accounts assigned to Lender; (b) the delivery to Lender
from time to time on demand, of a sum equal to the Net Face Amount (as defined
in Paragraph 6) of all Accounts assigned to Lender and which remain uncollected
more than ninety (90) days from the date of each invoice or which are more than
sixty (60) days past due. In addition, Borrower's entire unpaid indebtedness,
whenever and however created, shall become immediately due and payable upon the
occurrence of an Event of Default (as defined in Paragraph 22) or in the case of
termination, (as set forth in Paragraph 24), whether by notice, lapse of time or
otherwise, whichever occurs first. Payments received shall be applied first
against fees and costs, if any, then against interest and then against
principal. Each accounting rendered by Lender to Borrower shall be deemed
correct and binding unless Borrower notifies Lender in writing to the contrary
within thirty (30) days after the date of each accounting rendered by Lender.
3. Advances hereunder shall bear interest, on the average daily
outstanding balance, at the rate (the "Rate") of THREE PERCENTAGE POINT(S)
(3.0%) PER ANNUM over and above the rate announced as the "prime" rate in the
Western Edition of the Wall Street Journal which is in effect from time to time
(the "Prime Rate"); provided that the Prime Rate shall at all times be deemed to
be not less than FOUR PERCENT (4.00%) per annum (the "Deemed Prime Rate") and
provided that the minimum amount of interest payable together with the
Administrative Fees as defined in paragraph 4 hereof shall in no event be less
than TWO THOUSAND AND 00/100 DOLLARS ($2,000.00) per month (the "Minimum Monthly
Interest Payment"). In the event that the Prime Rate is changed, the adjustment
in the Rate charged shall be made on the day such change occurs. The Prime Rate
is a rate used by certain financial institutions as one of their index rates and
serves as a basis upon which effective rates of interest are calculated for
loans making reference thereto and may not be the lowest of such financial
institutions' index rates. Interest shall be computed on the basis of a 360-day
year for the actual number of days elapsed. Interest shall be due and payable
monthly on the first day of each month, and if not so paid, shall bear interest
at the Rate. At Lender's option, accrued interest may be charged as an Advance
under this Agreement. Notwithstanding anything to the contrary contained in this
Agreement, no payment made by check shall be deemed made until THREE (3)
BUSINESS DAYS after receipt thereof by Lender, to allow for and subject to,
clearance of such checks.
4. At the time of funding hereof and annually, every twelve (12)
months, thereafter, Borrower agrees to pay Lender a loan fee of ONE PERCENT
(1.0%) of the Maximum Amount (the "Loan Fee"). While any indebtedness remains
outstanding pursuant to this Agreement, on or before the first day of each
month, Borrower agrees to pay an administrative fee equal to ONE HALF OF ONE
PERCENT (0.50%) per month of the average daily outstanding balance during the
preceding month (the "Administrative Fee"). For purposes of computing the
average daily outstanding balance during the month and the Administrative Fee
payable on account thereof, payments made by check shall be applied as set forth
in Paragraph 2 and 3 above. Borrower shall pay to Lender the fees and costs
incurred by Lender in connection with the negotiation and preparation of this
Agreement and the Loan Documents, including but not limited to attorneys' fees,
audit fees, and recording fees. Lender has received or will receive a deposit in
the amount of TWO THOUSAND FIVE HUNDRED AND 00/100 DOLLARS ($2,500.00) (the
"Good Faith Deposit") to be applied against such fees and costs and an
additional deposit in the amount of ----------N/A---------- AND 00/100 DOLLARS
($----------N/A----------) to be applied against legal fees and costs, (the
"Legal Fee Deposit")(both collectively, the "Deposit"). Any unpaid portion of
the Deposit shall be due and payable at the funding hereof. In the event that
such fees and costs are less than the Deposit, any such excess amount will be
applied to the Loan Fee, or if the Loan Fee has been paid in full, such excess
amount shall be refunded to Borrower. Additionally, Borrower shall pay to Lender
on demand SEMI-ANNUAL AUDIT FEES OF SEVEN HUNDRED FIFTY AND 00/100 DOLLARS
($750.00) each, plus actual out of pocket costs related to each audit.
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5. This Agreement secures the following (a) Borrower's
obligations under the Advances and this Agreement; (b) all of Borrower's other
present and future obligations to Lender; (c) the repayment of (i) any amounts
that Lender may advance or spend for the maintenance or preservation of the
Collateral; and (ii) any other expenditures that Lender may make under the
provisions of this Agreement or for the benefit of Borrower; (d) all amounts
owed under any modifications, renewals or extensions of any of the foregoing
obligations whether or not of the nature contemplated at the date hereof; (e)
all other amounts now or in the future owed by Borrower to Lender; (f) any of
the foregoing that arises after the filing of a petition by or against Borrower
under the Bankruptcy Code, even if the obligations do not accrue because of the
automatic stay under Bankruptcy Code ss.362 or otherwise; and (g) interest on
the preceding amounts as agreed between Lender and Borrower, or if no such
agreement, at the maximum rate permitted by law (collectively, the
"Obligations"). These Obligations shall be secured by a continuing security
interest in all of the personal property and trade fixtures now owned or
hereafter acquired by Borrower whether now existing or hereafter arising and
wherever located, together with all collateral now or hereafter described in any
form UCC-1 filed against Borrower naming Lender as the secured party, including
without limitation, (1) all Accounts; (2) all Chattel Paper including without
limitation Electronic Chattel Paper; (3) all Inventory; (4) all Equipment; (5)
all trade fixtures and all Fixtures if real property collateral is involved; (6)
all Instruments; (7) all Investment Property; (8) all Documents; (9) all Deposit
Accounts; (10) all Letter of Credit Rights; (11) all General Intangibles
including without limitation copyrights, trademarks, and patents in all
countries, Payment Intangibles and Software; (12) all Supporting Obligations;
(13) any Commercial Tort Claim listed on any schedule provided herewith or
hereafter; (14) all returned or repossessed goods arising from or relating to
any Accounts or Chattel Paper; (15) all certificates of title and certificates
of origin or manufacturers statements of origin relating to any of the
foregoing, now owned or hereafter acquired; (16) all property similar to any of
the foregoing hereafter acquired by Borrower; (17) all ledger sheets, files,
records, documents, instruments, and other books and records (including without
limitation related electronic data processing Software) evidencing an interest
in or relating to the above; (18) all money, cash or cash equivalents; and (19)
to the extent not otherwise included in the foregoing, all proceeds, products,
insurance claims, and other rights to payment and all accessions to,
replacements for, substitutions for, and rents and profits of, and noncash
proceeds of each of the foregoing (all of the foregoing collectively, the
"Collateral"). All of the foregoing terms, capitalized or otherwise, shall have
the meaning given in the California Uniform Commercial Code, as amended from
time to time (the "UCC"). Notwithstanding any contrary term of this Agreement,
Collateral shall not include any waste or other materials that have been or may
be designated as toxic or hazardous. Each new Advance (and all prior Advances,
indebtedness or liabilities) shall be covered by this Agreement and all other
security agreements that Borrower has then given or caused to be given to
Lender. Except to the extent otherwise provided, this Agreement does not secure
any obligation that is secured by a consensual lien on real property.
6. As used in this Agreement, unless otherwise indicated by the
context, "Net Face Amount" shall mean with respect to an Account, the gross face
amount of such Account less all trade discounts or other deductions to which the
account debtor is entitled. "Prime Accounts" shall mean Accounts created by
Borrower which: (a) are acceptable to Lender; (b) are creditworthy; (c) have
been validly assigned to Lender; (d) as of the date of determination, are not
more than sixty (60) days past due or remain uncollected more than ninety (90)
days from the date of each invoice; and (e) strictly comply with all Borrower's
warranties and representations to Lender. "Value" shall mean the lower of cost
or fair market value. "Premises" shall mean 0000 XXXXXX XXXXXX, XXX XXXXXXX,
XXXXXXXXXX 00000, the Borrower's chief executive office (the "Chief Executive
Office"), and ----------N/A---------- Borrower's additional place(s) of
business, collectively.
7. Borrower shall preserve Borrower's existence and not, in one
transaction or a series of related transactions, (a) merge into or consolidate
with any other entity, or sell all or substantially all of Borrower's assets;
not change the Debtor's State, not change Borrower's legal name; (b) relocate
its Chief Executive Office or Premises; or (c) open any new locations unless
Borrower (1) gives thirty (30) days' prior written notification to Lender; and
(2) executes and delivers, or causes to be executed and delivered, to Lender
such agreements, documents, and instruments as Lender may deem reasonably
necessary or desirable to protect Lender's interests in the Collateral at such
locations, including without limitation, UCC-1 Financing Statements and waivers
with an acknowledgement of Lender's interest from any landlord, bailee, or
warehouseman in form and substance satisfactory to Lender. The Collateral,
however, shall not at any time now or hereafter be stored with a landlord,
bailee, warehouseman, or similar party without Lender's prior written consent
and Lender's receipt of an acknowledgement from the third party that it is
holding the Collateral for the benefit of Lender. Borrower will cooperate with
Lender in obtaining possession or control, where Lender chooses to require
possession or control in addition to the filing of a financing statement.
Borrower will cooperate with Lender in obtaining possession or control with
respect to Collateral consisting of Deposit Accounts, Investment Property,
Letter of Credit Rights, and Electronic Chattel Paper.
8. Borrower shall not do business under any name other than ALPHA
INNOTECH CORPORATION unless Borrower has provided to Lender evidence it has
taken such legal steps required with respect to fictitious or assumed names
under the applicable laws of the jurisdictions in which Borrower is located
and/or does business. To that effect, Lender has received acceptable
documentation indicating that Borrower will be doing business under the
following additional name(s): ----------N/A----------.
9. So long as Borrower is indebted to Lender, Borrower warrants,
represents and agrees that: (a) all Collateral in which a security interest has
been or will be given or caused to be given by Borrower to Lender is and will be
a first security interest on the property described in each such security
agreement (except insofar as Borrower has notified Lender to the contrary in
writing) and shall remain personal property at all times; (b) the property
covered by all security agreements given or caused to be given by Borrower to
Lender (1) is solely owned by Borrower, the party described in such security
agreement; or (2) Borrower has rights in or the power to grant a security
interest in such property; (c) the property covered by all security agreements
given or caused to be given by Borrower to Lender (except for sales of Inventory
in the ordinary course of business) is free and clear of all liens,
encumbrances, security interests, adverse claims, or restrictions on transfer or
pledge except as created by such
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security agreements; (d) the Collateral covered by all security agreements given
or caused to be given by Borrower to Lender is kept in good condition and
repair, is not subject to waste, will not (except for sales of Inventory in the
ordinary course of business) be affixed to any real property in any manner which
would change the Collateral's nature from that of personal property to real
property and/or fixture, or removed from the Premises described in such security
agreements without first obtaining Lender's prior written consent; (e) all
Collateral consisting of goods shall be located solely in CALIFORNIA or such
other state as Lender consents to in writing, the "Collateral State(s)"; (f) all
Accounts when delivered or otherwise transmitted to Lender pursuant to this
Agreement will be Prime Accounts and will have been created by absolute sales of
Borrower's merchandise or service, will be genuine, bona fide and collectible;
(g) Accounts delivered or otherwise transmitted to Lender pursuant to this
Agreement will not be subject to any dispute, right of offset, counterclaim, or
right of cancellation or return; (h) at the time of delivery or transmission of
Accounts to Lender pursuant to this Agreement, all property giving rise to such
Accounts will have been delivered (from Premises in the United States) to, and
unconditionally accepted by, each account debtor; (i) prior to the delivery and
transmission of an Account to Lender pursuant to this Agreement, Borrower will
have performed all things required by the terms of all agreements or purchase
orders giving rise to such Account; (j) at the time of delivery or other
transmission to Lender pursuant to this Agreement, all Accounts will be due and
unconditionally payable on terms of thirty (30) days or less, or on such other
terms (as are acceptable to Lender) which are expressly set forth on the face of
all invoices, copies of which shall be delivered to Lender and no Account will
then be past due; (k) Accounts do not consist of progress xxxxxxxx, xxxx and
hold invoices or retainage invoices; (l) neither the account debtor nor any
officer, employee or agent of the account debtor with respect to such Accounts
is an officer, employee or agent of or affiliated with Borrower directly or
indirectly by virtue of family membership, ownership, control, management or
otherwise; (m) the account debtors with respect to such Accounts are not any
foreign government, the United States of America, any State or any political
subdivision, department, agency or instrumentality thereof; unless, if the
account debtor is the United States of America, any state or any political
subdivision, department, agency or instrumentality thereof, the Federal
Assignment of Claims Act of 1940, as amended, or any similar State or local law,
if applicable, has been complied with in a manner satisfactory to Lender; (n)
Accounts of a single account debtor or its affiliates do not constitute more
than twenty-five percent (25%) of all otherwise Prime Accounts (but the portion
of the Accounts not in excess of such percentage may be deemed Prime Accounts);
(o) Accounts are not owed by any account debtor who has Accounts unpaid more
than ninety (90) days after the date of the original invoice therefore and which
constitute more than twenty-five percent (25%) of the total Accounts from such
account; (p) all facts, figures, representations given, or caused to be given by
Borrower to Lender in connection with the Value of the Collateral or regarding
each Advance or Account or pertaining to anything done under this Agreement
shall be true and correct; (q) Borrower's books and records fully and accurately
reflect all of Borrower's assets and liabilities (absolute and contingent), are
kept in the ordinary course of business in accordance with GAAP, ) as defined in
Paragraph 35) consistently applied and all information contained therein is true
and correct; (r) the fair market value of the property covered by all security
agreements given by Borrower to Lender, is and shall at all times be, not less
than the price which Borrower paid therefor (less normal depreciation caused by
ordinary wear and tear) and as represented to Lender; (s) Borrower will not
borrow any money in excess of Ten Thousand and 00/100 Dollars ($10,000.00) in
the aggregate, except pursuant to this Agreement without first obtaining the
consent of Lender; (t) all taxes of any governmental or taxing authority due or
payable by, or imposed or assessed against Borrower have been paid and shall be
paid in full before delinquency; (u) there are no actions or proceedings pending
by or against Borrower before any court or administrative agency, and there are
no pending, threatened, or know to be imminent litigations, governmental
investigations or claims, complaints, or prosecutions involving Borrower except
as heretofore disclosed in writing to Lender; (v) Borrower has the legal power
and authority to enter into this Agreement and to perform and discharge all of
its obligations hereunder; (w) Borrower's exact legal name is as set forth in
the first paragraph of this Agreement; (x) Borrower is a CORPORATION and
Borrower will do all things necessary to preserve good standing as a CORPORATION
under the laws of the State of CALIFORNIA, the state of Borrower's organization
and the state(s) where Borrower conducts business, specifically CALIFORNIA; and
(y) every payment falling due on Accounts assigned to Lender will be duly paid
and received by Lender on or before the earlier of ninety (90) days from the
date of each invoice or sixty (60) days from the due date of each invoice.
Lender does not authorize, and Borrower agrees not to: (1) make any sales or
leases of any of the Collateral outside of the ordinary course of business; (2)
enter into an exclusive license of any of the Collateral, a license of any of
the Collateral outside of the ordinary course of business or fail to notify
Lender of any license permitted hereunder; or (3) grant any other security
interest in any of the Collateral. To the extent Borrower uses Advances under
this Agreement to purchase Collateral, Borrower's repayment of the Advances
shall apply on a "first-in first-out" basis so that the portion of the Advances
used to purchase a particular item of Collateral shall be paid in the
chronological order in which Borrower purchased the Collateral.
10. Borrower agrees to execute upon demand by Lender any and all
Financing Statements, Continuation Statements or other statements intended to
perfect and/or continue Lender's security interest in the Collateral, in
whatsoever form Lender may require including but not limited to an abbreviated
Collateral description such as "All Assets of the Borrower", as provided for and
defined in Division 9 of the California UCC, but Lender shall be entitled and is
hereby expressly authorized to execute and file the same on Borrower's behalf,
and Lender is hereby appointed Borrower's attorney-in-fact for such purpose.
11. Each warranty, representation, and agreement contained in this
Agreement shall be automatically deemed repeated with each Advance and shall be
conclusively presumed to have been relied on by Lender regardless of any
investigation made, or information possessed by Lender. The warranties,
representations and agreements set forth herein shall be cumulative and in
addition to any and all other warranties, representations and agreements
contained in any other document or instrument which Borrower shall give, or
cause to be given, to Lender either now or hereafter.
12. Notwithstanding termination of this Agreement, all
assignments, pledges, liens, and/or other security interest now or hereafter
granted to Lender shall continue in full force until all of the Obligations
owing to Lender have been paid.
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13. Borrower shall promptly pay any and all expenses of storing,
warehousing, insuring, handling and shipping of Borrower's property and any and
all excise, property, sales and other taxes (providing Lender with evidence of
payment thereof), security interest, encumbrances and liens, levied or imposed
by any governmental or taxing authority on Borrower or on any of Borrower's
property or any property caused to be given to Lender as security. If Borrower
fails to promptly pay when due, whether to Lender or any other person, monies
which Borrower is required to pay under any portion of this Agreement, Lender
may, but need not, pay the same and charge Borrower's account therefore and
Borrower shall promptly reimburse Lender therefor. Any and all sums shall become
additional indebtedness owing to Lender and shall bear interest at the rate
provided in Paragraph 3 hereof and shall be covered by all security now or
hereafter given by Borrower or which Borrower causes to be given to Lender.
Lender need not inquire as to, or contest the validity of, any such expense,
tax, security interest, encumbrance or lien, and the receipt of the usual
official for the payment thereof shall be conclusive evidence that the same was
validly due and owing.
14. All documents to be delivered by Borrower shall contain such
terms and be in such form as Lender may require. Each assignment, pledge or
other security agreement shall include and cover all of Borrower's right, title
and interest in property described therein and all of Borrower's books, records
and files relating thereto. All ledger sheets, files, records and documents,
files and records relating to Accounts, Inventory, or other Collateral assigned
to Lender shall, unless delivered to or removed by Lender, be kept on the
Premises in trust for, and without cost to Lender. Lender may at any time remove
from the Premises all documents, files and records relating to the Collateral.
15. Prior to Lender's first verification of Inventory or audit of
Borrower's Accounts, Lender may, in Lender's sole discretion, determine or
redetermine the Value of Borrower's Inventory or Accounts by applying to
Borrower's assigned Value thereof such percentage as Lender deems appropriate,
based upon Lender's initial sample of other basis. Lender may likewise determine
or redetermine the Value thereof between Lender's Inventory verifications and
audits of Borrower's Accounts, based upon Lender's last preceding verification,
audit, sampling, review, or other basis.
16. Borrower shall have the revocable privilege to collect at
Borrower's expense the payments due on Accounts delivered or otherwise
transmitted to Lender pursuant to this Agreement, upon the express condition,
however, that all such collections shall (a) be received by Borrower in trust
for Lender; (b) not be mingled with Borrower's funds; and (c) be delivered to
Lender in kind within twenty-four (24) hours after Borrower's receipt of the
same. Borrower's collection privilege as described above is subject to
revocation by Lender at any time and shall be automatically revoked upon the
happening of an Event of Default as defined below. Unless the instruments so
received by Borrower are dishonored, or unless Borrower shall in Borrower's
discretion have remitted the amount thereof to Lender, Lender shall credit the
amount thereof against Borrower's indebtedness to Lender as set forth in
Paragraphs 2 and 3 above. Lender is hereby irrevocably appointed Borrower's
attorney-in-fact with authority and power to endorse Borrower's name on any
checks, notes, acceptances, money orders, drafts, or other forms of payment or
security that may come into Lender's possession; to sign Borrower's name on any
invoice or xxxx of lading related to any Accounts, on drafts against account
debtors, on schedules and assignments of Accounts, on verification of Accounts,
and notices to account debtors; to establish a lock box arrangement and/or at
Lender's sole discretion to notify the post office authorities to change the
address for delivery of Borrower's mail; to receive and open all mail addressed
to Borrower and to retain all mail relating to Lender's security, forwarding all
other mail to Borrower; to send, whether in writing or by telephone, requests
for verification of Accounts; and to do all things necessary to carry out this
Agreement. Lender shall have the right at any time to enforce Borrower's rights
against the account debtors and obligors.
17. If any property referred to or covered by any Account assigned
to Lender shall remain in, or revert to, Borrower's possession, Borrower will
forthwith set it apart, xxxx and designate it as Lender's Collateral and
promptly notify Lender.
18. Borrower will prepare and deliver to Lender financial
statements, balance sheets, profit and loss statements, schedules of Accounts,
agings (listing the names and addresses of, and amounts owing by date, by
account debtors), preliminary fiscal year end financial statements, reviewed
fiscal year end statements and/or tax returns, and such other reports, analysis
and operating data as Lender may from time to time reasonably request orally or
in writing, all in form acceptable to Lender, but in any event shall provide the
following:
(a) Monthly internally prepared financial statements due within
thirty (30) days of month end;
(b) Monthly accounts payable aging due within fifteen (15) days of
month end;
(c) Payroll tax receipts due within thirty (30) days of payment.
All taxes must be paid when due;
(d) Preliminary year-end statements due within sixty (60) days of
fiscal year end; and
(e) Corporate tax returns and reviewed fiscal year end statements
due within one hundred twenty (120) days of fiscal year end.
19. Lender or Lender's agents or employees shall have the right,
during reasonable business hours if prior to an Event of Default and at any time
if on or after an Event of Default, to have access to, examine, inspect and/or
audit any or all of Borrower's books and records, including but not limited to
minute books, ledgers, records indicating, summarizing or evidencing the assets
(including Accounts, Inventory and Equipment) and liabilities, and all
information relating thereto, records indicating, summarizing or evidencing
Borrower's business operations or financial condition, and all computer
programs, disc or tape files, printouts, runs and other computer prepared
information and the equipment containing such information, and permit Lender or
Lender's employees or agents to
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copy and make extracts therefrom. Borrower hereby irrevocably authorizes all
accountants and third parties to disclose and deliver to Lender at Borrower's
expense all financial information, books and records, work papers, management
reports and other information in their possession relating to Borrower.
20. Borrower shall accept no returns and shall grant no allowances
or credits to account debtors without notifying Lender at the time credit is
issued. Borrower shall maintain insurance at Borrower's expense on property
given to Lender as security with such carriers, covering such risks and
containing such amount of coverage and other terms (including an endorsement
providing for non-cancellation except upon thirty (30) days' written notice to
Lender and a loss payable endorsement, 438BFU, in Lender's favor) as Lender may
from time to time specify in writing. Borrower shall promptly deliver to Lender
copies of all policies, endorsements, evidence of premium payment, claims and
reports to insurance carriers.
21. Borrower promises and agrees to pay all costs and expenses and
all attorneys' fees incurred by Lender in connection with this Agreement and the
transactions contemplated hereby (including without limitation the prosecution
of motions or actions seeking relief from any stay or restraint under the United
States Bankruptcy Code from pursuing any remedy hereunder), whether or not suit
between Borrower and Lender is brought. Lender may bring all proceedings for
collection in Lender's name or in Borrower's name and may exercise Borrower's
right of stoppage in transit, replevin, and reclamation. Should an Event of
Default occur, Borrower shall pay to Lender all costs reasonably incurred by
Lender for the purpose of enforcing Lender's rights hereunder, including without
limitation: (a) costs of foreclosure; (b) costs of obtaining money damages; and
(c) a reasonable fee for the services of attorneys employed by Lender, whether
outside counsel or in house counsel, for any purpose related to this Agreement
or the obligations, including consultation, drafting documents, sending notices
or instituting, prosecuting or defending litigation or arbitration, and in the
case of bankruptcy, in providing debtor-in possession financing, in seeking
relief from the automatic stay, and in prosecuting a complaint to determine
dischargeability and other matters to enforce Lender's rights; and (d) costs,
and expenses of third party claims or any other suit paid or incurred by Lender
in enforcing or defending the Loan Documents and adjusting or settling disputes
and claims with account debtors with respect to the Accounts; and Lender's
reasonable attorneys' fees and expenses incurred in advising, structuring,
drafting, reviewing, administering, amending, terminating, enforcing the
Obligations.
22. Without limiting any other portion of this Agreement, all
Borrower's indebtedness and Obligation shall automatically accelerate and become
immediately due and payable, and the revocable collection privilege referred to
in Paragraph 16 shall be automatically revoked, upon termination (by lapse of
time or otherwise) of this Agreement or upon the happening of any one of the
following which shall, at the option of Lender, constitute an "Event of
Default":
(a) Borrower's failure to make any payment to Lender when due, or any
default under, or breach or violation of, any warranty, representation,
obligation, agreement, condition or undertaking contained herein or in any other
written document which Borrower now or hereafter executes and delivers, or which
Borrower now or hereafter causes to be executed and delivered to Lender; (b) the
Obligations at any time exceed the Maximum Amount (c) Any change in Borrower's
business, (including, without limitation, the ownership thereof) or financial
condition or that of any guarantor of any of Borrower's Obligations or
indebtedness hereunder or any decline in the Value of any property given to
Lender as security, which causes Lender to deem itself insecure; (d) The
withdrawal or cancellation of any guarantor of any of Borrower's Obligations or
indebtedness hereunder, or the termination of any subordination agreement
whereby any indebtedness is subordinated to Borrower's Obligations; (e) The
ceasing to do business as a going concern, or the assignment of any property for
the benefit of creditors or the commission of any act of bankruptcy or
insolvency, by or on the part of Borrower or any guarantor of any of Borrower's
Obligations or indebtedness hereunder; (f) The filing by or against Borrower or
any guarantor of any of Borrower's Obligations or indebtedness hereunder of any
petition or application in bankruptcy, reorganization, arrangement, trusteeship
or receivership, whether under the United States Bankruptcy Code or otherwise,
or the appointment of a trustee or receiver over all or any part of the property
or business of Borrower or any guarantor of any of Borrower's Obligations or
indebtedness hereunder, or the levying of an attachment or garnishment on any of
Borrower's property which is not released within ten (10) days; (g) Any of the
property or Collateral covered by any of the security agreements given or caused
to be given by Borrower to Lender is lost, secreted, misused, destroyed,
transferred, or disposed of or is located in any state other than the Collateral
State(s) unless Lender has so agreed in writing; (h) Borrower's failure to
comply with, or become subject to any administrative or judicial proceeding
under any federal, state or local (1) hazardous waste or environmental law; (2)
asset forfeiture of property; or (3) other law, where noncompliance may have any
significant effect on the Collateral; (i) Lender's receipt, at any time
following the initial funding, of a report from the Secretary of State
indicating that Lender's security interest is not prior to all other security
interests or other interests reflected in the report; or (ii) Any delinquency on
Borrower's part in paying any tax when it comes due.
23. Borrower waives presentment, demand, protest, and notice of
dishonor as to any instrument. Borrower consents to any extensions,
modifications, allowances, compromises or releases of security which Lender may
grant, none of which shall release Borrower or any guarantors from, or affect,
any of Borrower's or Guarantor's Obligations.
24. This Agreement shall be effective as of the date of the
initial funding hereof and shall remain in full force and effect for a period of
TWELVE (-12-) MONTH(S) (the "Basic Term"). Notwithstanding the preceding
sentence, this Agreement shall be renewed automatically for successive periods
(each, a "Renewal Term") equal to the Basic Term unless this Agreement is
terminated by Borrower giving written notice (a "Termination Notice") to Lender
specifying such termination. Termination Notices shall be given by mailing a
registered or certified letter specifying such termination not less than thirty
(30) days prior to the effective date of such termination, addressed to Lender
at the address set forth herein, and the termination shall be effective as of
the date fixed in such notice. Notwithstanding the foregoing, Lender reserves
the right to terminate this Agreement at Lender's sole discretion upon giving
thirty (30) days' prior written notice to Borrower or should Borrower be in
default of one or more
Page 5 of 11
rovisions of this Agreement, Lender may terminate this Agreement at any time
without notice. After termination and when Lender has received all sums due,
Lender shall reassign to Borrower all Collateral held by Lender, and shall
execute a cancellation of, and/or reconveyance under, all security agreements
given by Borrower to Lender.
25. The Obligations may be prepaid by Borrower at any time and to
the extent such Prepayment occurs, Borrower shall pay to Lender a fee equal to
the amount of the Minimum Monthly Interest Payment times the number of months
remaining in the Basic Term or Renewal Term, as applicable (the "Prepayment
Fee"). In addition, Borrower shall also pay any prepayment fees or penalties
provided for in any other agreement with Lender. "Prepayment" includes any
payment or other reduction of the balance of the Obligations, regardless of
whether such payment or other reduction (a) is voluntary or involuntary; (b) is
occasioned by Lender's acceleration of the Obligations or demand hereunder; (c)
is made by Borrower or other third party, including Guarantor; (d) results from
Lender's receipt or collection of proceeds of Collateral, including insurance
proceeds and condemnation awards; (e) results from Lender's exercise of Lender's
right of setoff; and/or (f) is made during a bankruptcy, reorganization or other
proceeding, or is made pursuant to any plan of reorganization or liquidation.
26. Borrower will reimburse Lender for all out-of-pocket expenses
incurred by Lender, including, without limitation, the cost of title searches,
title reports, title insurance, recording fees, filing fees, publication fees,
attorneys' fees, appraisals, and all other expenses similar to the foregoing. If
during the term hereof, Borrower fails to make any such payment required, Lender
may, but need not, pay the same and charge Borrower's account therefor.
27. Lender may, in its discretion, make advances under this
Agreement or under the Obligations to make any payments due from Borrower to
Lender under this Agreement or any of the Obligations. Lender may also, in its
sole discretion, reserve under this Agreement or under the Obligations, for
amounts due under this Agreement or any of the Obligations
28. In case of any breach or default by Borrower, or the
occurrence of any Event of Default described in Paragraph 22, or if Borrower
fails or neglects to promptly pay any and all of their Obligations, when due,
all of their Obligations shall, without notice or demand, become immediately due
and payable at Lender's option. Thereafter, all amounts outstanding shall bear
interest at the rate of an additional THREE PERCENT (3.0%) per annum in excess
of the Rate (the "Default Rate"). Upon the occurrence of any such Event of
Default Lender may immediately, or at any time or times thereafter, without any
demand or notice to Borrower or any guarantor of any of the Obligations and
without advertisement or notice, all of which are expressly waived, commence an
action for the recovery of any and all such Obligations, commence proceedings,
without giving any warranties of merchantability, fitness for purpose, title or
similar warranty, to sell, lease or otherwise dispose of any and all Collateral
covered by this Agreement and by all security agreements given or caused to be
given by Borrower to Lender or, without legal proceedings, enter such places as
any of such Collateral may be found and take possession of such Collateral and
sell the same. Such Collateral may be sold where it is located at the time of
the breach or default, or elsewhere, at public or private sale, for cash, upon
credit or otherwise at Lender's sole option and discretion. Lender waives any
requirements that such property be physically present at the place of sale.
Lender shall provide Borrower such notice of any private or public sale as may
be reasonable. Lender has no obligation to clean up or otherwise prepare the
Collateral for sale. Lender may specifically disclaim any warranties of title or
any similar warranty. Any person, including Lender, may purchase at any such
sale, free from any right of redemption which is expressly waived by Borrower,
and if Lender is the purchaser, may turn all or part of any of Borrower's
indebtedness to Lender in toward payment of the purchase price. The proceeds of
any such sale or other disposition shall be applied, first to all expenses of
setting all liens and claims against, and all costs, charges and expenses
incurred in taking, removing, holding, repairing and selling such Collateral,
including without limitation, all attorneys' fees and costs incurred by Lender,
and second, to the payment of all Obligations, whether due, or to become due,
and whether arising under this Agreement or otherwise. The surplus, if any,
shall be delivered to Borrower. Borrower shall pay any deficiency forthwith.
29. All notices or demands hereunder shall be in writing and sent
by certified, first class mail. They shall be deemed received when deposited in
a United States Post Office Mail Box, postage paid, properly addressed to Lender
or Borrower at the addresses set forth herein or to such other address as Lender
or Borrower may from time to time specify in writing.
30. Borrower has the risk of loss of the Collateral Lender shall
not be liable or responsible for the safekeeping of any Collateral. Lender shall
not be responsible for any lost profits of Borrower arising from any breach of
contract, tort (excluding the Lender's gross negligence or willful misconduct),
or any other wrong arising from the establishment, administration, or collection
of the Obligations. Lender has no duty to collect any income accruing on the
Collateral or to preserve any rights relating to the Collateral.
31. Borrower hereby releases and exculpates Lender, Lender's
officers, employees, agents, designees, attorneys, directors, shareholders, and
accountants from any liability arising from any acts under this Agreement, the
documents executed in connection with this Agreement or subsequent to this
Agreement or in furtherance thereof, whether of omission or commission, and
whether based upon any error of judgment or mistake of law or fact, except for
gross negligence or willful misconduct. In no event shall Lender have any
liability to Borrower for lost profits or other special or consequential
damages.
32. If there are two or more Borrowers, then (a) regardless of the
form of Lender's check or other papers, Advances hereunder shall be deemed to be
made to each and all Borrowers and each Borrower shall be jointly and severally
obligated to repay the Obligations; (b) each Borrower jointly and severally
makes, and is liable for, each and every warranty, representation, obligation,
covenant and undertaking under this Agreement; (c) when permitted by the
context, the word "Borrower" shall include and mean all, or any one of the
undersigned Borrowers; (d) each Borrower hereby waives its rights of
subrogation, reimbursement, indemnification, and contribution and
Page 6 of 11
any other rights and defenses that are or may become available to any Borrower
by reason of Sections 2787 to 2855, inclusive of the California Civil Code; (e)
each Borrower waives all rights and defenses it may have if this Agreement is
secured by real property, which means, among other things: (1) Lender may
collect from any Borrower without first foreclosing on any real or personal
property collateral pledged by Borrower; and (2) if Lender forecloses on any
real property collateral pledged by any Borrower: (i) the amount of the debt may
be reduced only by the price for which that collateral is sold at the
foreclosure sale, even if the collateral is worth more than the sale price; and
(ii) Lender may collect from any Borrower even if Lender, by foreclosing on the
real property collateral, has destroyed any right any Borrower may have to
collect from any other Borrower. This is an unconditional and irrevocable waiver
of any rights and defenses any Borrower may have because Borrower's debt is
secured by real property. These rights and defenses include, but are not limited
to, any rights or defenses based upon Section 580a, 580b, 580d, or 726 of the
Code of Civil Procedure; (f) each Borrower waives all rights and defenses
arising out of an election of remedies by Lender, even though that election of
remedies, such as a nonjudicial foreclosure with respect to security for a
guaranteed obligation, has destroyed any Borrower's rights of subrogation and
reimbursement against the principal by the operation of Section 580d of the Code
of Civil Procedure or otherwise, and each Borrower further waives any and all
benefits or defenses, if any, arising directly or indirectly under any one or
more of Sections 3116, 3118, 3119, 3419, 3605, 9504, 9505, and 9507 of the
California Uniform Commercial Code; and (g) each Borrower hereby agrees that it
is jointly and severally, directly, and primarily liable to Bank for payment and
performance in full of all duties, obligations, and liabilities under this
Agreement and each other document, instrument, and agreement entered into by any
Borrower with or in favor of Lender in connection herewith, and that such
liability is independent of the duties, obligations, and liabilities of any
other Borrower or any other guarantor of the Obligations, as applicable. Each
reference herein to Borrower shall mean each and every Borrower that is a party
hereto, individually and collectively, jointly and severally.
33. Lender's rights and remedies under this Agreement and all
security agreements shall be cumulative and Lender shall have all other rights
and remedies not inconsistent therewith as provided by law; no exercise by
Lender of one right or remedy shall be deemed an election and no waiver by
Lender of any default in Borrower's part shall be deemed a continuing waiver. No
delay or omission by Lender shall constitute a waiver or election. This
Agreement shall be binding when signed by Lender where indicated below and shall
bind and inure to the benefit of heirs, legatees, executors, administrators,
successors, and assigns of Lender and shall bind all parties which become bound
as a borrower to this Agreement. However, Borrower may not assign this Agreement
or any rights hereunder without Lender's prior written consent. No such consent
by Lender shall release Borrower or any guarantor of any Obligation or
indebtedness hereunder. Lender reserves the right to sell, assign, transfer,
negotiate or grant participations in all or any part of, or any interest in,
Lender's rights and benefits under each of the documents executed herewith or
hereafter. In connection therewith, Lender may disclose all documents and
information that Lender now has or may hereafter acquire relating to any credit
extended by Lender to Borrower, or about Borrower or Borrower's business, any
guarantor or the business of any guarantor, or any Collateral required
hereunder. Lender may assign Lender's rights and interests under this Agreement.
If an assignment is made by Lender, Borrower shall render performance under this
Agreement to such assignee. Borrower waives and will not assert against any
assignee any claims, defenses or set-offs that Borrower could assert against
Lender except defenses that cannot be waived.
34. Paragraphs and paragraph numbers have been set forth herein
for convenience only; unless the contrary is compelled by the context,
everything contained in each paragraph applies equally to all paragraphs herein.
Neither this Agreement nor any uncertainty, or ambiguity herein shall be
construed or resolved against Lender or Borrower whether under any rule of
construction or otherwise; on the contrary, this Agreement has been reviewed by
all parties and shall be construed and interpreted according to the ordinary
meaning of the words so used as to fairly accomplish the purposes and intentions
of all parties hereto. When permitted by the context, the singular includes the
plural and vice versa. No reference to "proceeds" in this Agreement authorizes
any sale, transfer, or other disposition of the Collateral by Borrower.
"Includes" and "including" are not limiting. "Or" is not exclusive. "All"
includes "any" and "any" includes "all". Any reference herein to a "writing", a
"written document", or an executed document shall also mean an "authenticated"
writing or document or "authentication" (as defined in the UCC) unless Lender
shall otherwise require an original writing.
35. This Agreement and all transactions contemplated hereunder
and/or evidenced hereby shall be governed by, construed under, and enforced in
accordance with the internal laws of the State of California without giving
effect to conflicts of law principles. This Agreement and all agreements
relating to the subject matter hereof are the product of negotiation and
preparation by and among each party and its respective attorneys, and shall be
construed accordingly. The parties waive the provisions of California Civil Code
ss.1654.
36. Unless otherwise specified herein, all accounting terms used
herein shall be interpreted, all accounting determinations shall be made, and
all financial statements required to be delivered hereunder shall be prepared in
accordance with GAAP. All other terms contained in this Agreement, which are not
specifically defined herein, shall have the meanings provided in the UCC to the
extent the same are used herein. All references herein to the singular or plural
shall also mean the plural or the singular, respectively. "GAAP" means generally
accepted accounting principles set forth in the opinions and pronouncements of
the Accounting Principles Board of the American Institute of Certified Public
Accountants and pronouncements of the Financial Accounting Standards Board (or
any successor authority) that are applicable as of the date of determination.
37. Any Collateral pledged to Lender to secure any obligation of
Borrower shall also secure any other obligation of Borrower to Lender except
that any real property pledged to secure any obligation of Borrower shall only
secure any other obligation of Borrower if Lender specifically so agrees in
writing.
38. An Event of Default under this Agreement shall be an Event of
Default under the Obligations and vice versa.
Page 7 of 11
39. Each and every provision of this Agreement shall be severable
from every other provision for the purposes of determining legal enforceability
of any such provision or provisions.
40. This Agreement embodies the entire agreement and understanding
among and between the parties hereto with respect to the subject matter hereof,
and supersedes all prior or contemporaneous agreements and understandings
between said parties, verbal or written, express or implied, relating to the
subject matter hereof. No promises of any kind have been made by Lender or any
third party to induce Borrower to execute this Agreement. No course of dealing,
course of performance or trade usage, and no parol evidence of any nature, shall
be used to supplement or modify any terms of this Agreement.
41. This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if all signatures
were upon the same instrument. Delivery of an executed counterpart of the
signature page to this Agreement by telefacsimile shall be effective as delivery
of a manually executed counterpart of this Agreement, and any party delivering
such an executed counterpart of the signature page to this Agreement by
telefacsimile to any other party shall thereafter also promptly deliver a
manually executed counterpart of this Agreement to such other party, provided
that the failure to deliver such manually executed counterpart shall not affect
the validity, enforceability, or binding effect of this Agreement.
42. ANY LAWSUIT OR OTHER PROCEEDING ARISING OR CONNECTED WITH THIS
AGREEMENT OR THE SECURITY INTERESTS CREATED HEREUNDER SHALL, TO THE EXTENT
PERMITTED BY LAW, BE BROUGHT AND TRIED SOLELY IN THE SUPERIOR COURT OF SANTA
XXXXX COUNTY, CALIFORNIA. BORROWER AND LENDER HEREBY WAIVE ANY RIGHT TO A JURY
TRIAL IN ANY ACTION HEREUNDER OR ARISING OUT OF THE TRANSACTIONS BETWEEN
BORROWER AND LENDER.
This Loan and Security Agreement is subject to the terms and conditions
set forth in Addendum A and the Environmental Rider attached hereto and made a
part hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Loan and
Security Agreement to be executed as of the date first set forth above.
ALPHA INNOTECH CORPORATION
("Borrower")
/s/ Xxxxxx X. Xxxxxxx
---------------------------------
By: Xxxxxx X. Xxxxxxxx
Its: C.E.O.
BFI BUSINESS FINANCE
("Lender")
/s/ Xxxxx Xxxxxx
---------------------------------
By: Xxxxx Xxxxxx
Its: President
Page 8 of 11
ADDENDUM A TO LOAN AND SECURITY AGREEMENT
Pursuant to this Addendum A to Loan and Security Agreement (this
"Addendum"), the foregoing Loan and Security Agreement by and between BFI
Business Finance and ALPHA INNOTECH CORPORATION (the "Agreement") is hereby
amended and/or supplemented by the following terms and conditions, which are
incorporated by this reference in this Agreement as the following additional
paragraphs to this Agreement:
43. Lender agrees that Accounts of a foreign account debtor or its
affiliates (each, a "Foreign Account") may be deemed to be Prime Accounts
provided: (i) such Foreign Account otherwise is a Prime Account; (ii) Borrower
has obtained credit insurance for each Foreign Account on terms, in amounts and
from insurers satisfactory to Lender; and (iii) such Foreign Accounts do not
constitute more than thirty-three and one third percent (33.33%) of all
otherwise Prime Accounts (but the portion of such Foreign Accounts not in excess
of such percentage may be deemed to be Prime Accounts).
44. Notwithstanding the provisions of Section 9 (s), Borrower has
advised Lender of certain existing and unsecured debt (the "Existing Debt") in
the form of several promissory notes (individually the "Note" and collectively
the "Notes"). Borrower has also advised Lender that it intends to replace such
Existing Debt as well as obtain additional unsecured funding from parties other
than Lender (collectively the "Replacement Debt"). Lender hereby acknowledges
and consents to such Replacement Debt providing Borrower (i) shall make no
payment other than payment in full to any Note under the Existing Debt; (ii)
Borrower shall have repaid in its entirety and replaced the Existing Debt no
later than thirty (30) days from the funding hereof; (iii) any documentation
executed in connection with the Replacement Debt shall include language
acceptable to Lender making the payment of said Replacement Debt junior and
subordinate to that of Lender, a copy of which shall be provided to Lender
within five (5) days of the execution thereof; and (iv) the combined aggregate
amount of all agreements to repay said Replacement Debt shall not at any one
time be greater than the amount of TWO MILLION EIGHT HUNDRED TEN THOUSAND AND
00/100 DOLLARS ($2,810,000.00).
In the event Borrower, during the first thirty (30) days after
the funding hereof, shall not have obtained Replacement Debt sufficient to make
payment in full on the Existing Debt leaving amounts still due, payable, and
owing (the "Remaining Existing Debt"), Borrower shall obtain and provide to
Lender agreements in form and substance acceptable to Lender making the payment
of any and all obligations under the Remaining Existing Debt subordinate to that
of Lender. Lender shall agree to an additional thirty (30) day period from the
date of the funding hereof, but in any event not longer than a total of sixty
(60) days from the funding hereof, during which Borrower shall obtain said
agreements and provide Lender with evidence of same.
Page 9 of 11
ENVIRONMENTAL RIDER
This Environmental Rider (this "Rider") is entered into as of MARCH 9,
2004 and is hereby made a part of and incorporated into that certain LOAN AND
SECURITY AGREEMENT (the "Agreement") dated MARCH 9, 2004 between BFI BUSINESS
FINANCE, a California corporation ("Lender") and ALPHA INNOTECH CORPORATION,
a(n) CALIFORNIA CORPORATION ("Borrower").
1. Borrower hereby represents, warrants and covenants that none
of the collateral or real property occupied and/or owned by Borrower has ever
been used by Borrower or any other previous owner and/or operator in connection
with the disposal of or to refine, generate, manufacture, produce, store,
handle, treat, transfer, release, process or transport any hazardous waste, as
defined in 42 U.S.C. 9601 (14) or any successor statute, all as amended from
time to time ("Hazardous Substance" or "Hazardous Waste"), and Borrower will not
at any time use the collateral or such real property for the disposal of,
refining of, generating, manufacturing, producing, storing, handling, treating,
transferring, releasing, processing, or transporting any such Hazardous
Substance and/or Hazardous Waste.
2. None of the collateral or real property used and/or occupied
by Borrower has been designated, listed or identified in any manner by the
United States Environmental Protection Agency (the "EPA") or under and pursuant
to the Comprehensive Environmental Response, Compensation and Liability Act of
1980 set forth at 42 U.S.C. 9601 et seq. ("CERCLA") or any successor statute, as
amended from time to time, or the Resource Conservation and Recovery Act of 1986
set forth at 42 U.S.C. 9601 et seq. ("RCRA") or any successor statute, as
amended from time to time, or any other environmental protection statute as a
Hazardous Substance or Hazardous Waste disposal or removal site, superfund or
cleanup site or candidate for removal of closure pursuant to RCRA, CERCLA or any
other environmental protection statute.
3. Borrower has not received a summons, citation, notice,
directive, letter or other communication, written or oral, from the EPA or any
other federal or state governmental agency or instrumentality, authorized
pursuant to an environmental protection statute, concerning any intentional or
unintentional action or omission by Borrower resulting in the releasing,
spilling, leaking, pumping, pouring, emitting, emptying, dumping or otherwise
disposing of Hazardous Substance or Hazardous Waste into the environment
resulting in damage thereto or to the fish, shellfish, wildlife, biota or other
natural resources.
4. Borrower shall not cause or permit to exist, as a result of an
intentional or unintentional action or omission on its part, or on the part of
any third party, on property owned and/or occupied by Borrower, any disposal,
releasing, spilling, leaking, pumping, omitting, pouring, emptying or dumping of
a Hazardous Substance or Hazardous Waste into the environment where damage may
result to the environment, fish, shellfish, wildlife, biota or other natural
resources unless such disposal, release, spill, leak, pumping, emission,
pouring, emptying or dumping is pursuant to and in compliance with the
conditions of a permit issued by the appropriate federal or state governmental
authority.
5. Borrower shall furnish to Lender:
(a) Promptly and in any event within thirty (30) days
after receipt thereof, a copy of any notice, summons, citation, directive,
letter or other communications from the EPA or any other governmental agency or
instrumentality concerning any intentional or unintentional action or omission
on Borrower's part in connection with the handling, transporting, transferring,
disposal or in the releasing, spilling, leaking, pumping, pouring, emitting,
emptying or dumping of Hazardous Substance or Hazardous Waste into the
environment resulting in damage to the environment, fish, shellfish, wildlife,
biota and any other natural resource;
(b) Promptly and in any event within thirty (30) days
after the receipt thereof, a copy of any notice of or other communication
concerning the filing of a lien upon, against or in connection with Borrower,
the collateral or Borrower's real property by the EPA or any other governmental
agency or instrumentality authorized to file such a lien pursuant to an
environmental protection statute in connection with a fund to pay for damages
and/or cleanup and/or removal costs arising from the intentional or
unintentional action or omission of Borrower resulting from the disposal or in
the releasing, spilling, leaking, pumping, pouring, emitting, emptying or
dumping of Hazardous Substance or Hazardous Waste into the environment;
(c) Promptly and in any event within thirty (30) days
after the receipt thereof, a copy of any notice, directive, letter or other
communication from the EPA or any other governmental agency or instrumentality
acting under the authority of an environmental protection statute indicating
that all or any portion of the Borrower's property or assets have been listed
and/or that Borrower has been deemed by such agency to be the owner and operator
of the facility that has failed to furnish to the EPA or other authorized
governmental agency or instrumentality, all the information required by the
RCRA, CERCLA or other applicable environmental protection statutes; and
(d) Promptly and in no event more than thirty (30) days
after the filing thereof with the EPA or other governmental agency or
instrumentality authorized as such pursuant to an environmental protection
statute, copies of any and all information reports filed with such agency or
instrumentality in connection with Borrower's compliance with RCRA, CERCLA, or
other applicable environmental protection statutes.
6. Any one or more of the following events which occur with
respect to Borrower shall constitute an event of default:
(a) The breach by Borrower of any covenant or condition,
representation or warranty contained in this Rider;
Page 10 of 11
(b) The failure by Borrower to comply with each, every
and all of the requirements of RCRA, CERCLA or any other applicable
environmental law, statute, or regulation on Borrower's other property;
(c) The receipt by Borrower of a notice from the EPA or
any other governmental agency or instrumentality acting under the authority of
any environmental protection statute, indicating that a lien has been filed
against any of the collateral, or any of Borrower's other property by the EPA or
any other governmental agency or instrumentality in connection with a fund as a
result of damage arising from an intentional or unintentional action or omission
by Borrower resulting from the disposal, releasing, spilling, leaking, pumping,
pouring, emitting, emptying or dumping of Hazardous Substances or Hazardous
Waste into the environment; and
(d) Any other event or condition exists which might, in
the opinion of Lender, under applicable environmental protection statutes, have
a material adverse effect on the financial or operational condition of Borrower
or the value of all or any material part of the collateral or other property of
Borrower.
IN WITNESS WHEREOF, the parties hereto have caused this Environmental
Rider to be executed as of the date first set forth above.
ALPHA INNOTECH CORPORATION
("Borrower")
/s/ Xxxxxx X. Xxxxxxx
---------------------------------
By: Xxxxxx X. Xxxxxxxx
Its: C.E.O.
Page 11 of 11
