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EXHIBIT 10.45
LOAN AGREEMENT
This Loan Agreement ("Agreement") is entered into as of May 1, 2000 by
and between XXXX.XXX, INC., a Delaware corporation (the "Company"), and XXXXX
XXXXX (the "Borrower").
RECITALS
The Borrower desires to borrow and the Company is willing to lend
Borrower up to $150,000 on an unsecured basis under the terms and conditions of
this Agreement.
NOW, THEREFORE, the Company and the Borrower agree as follows:
1. The Loan. Subject to the terms and conditions contained herein, the
Company will a make a loan to Borrower in an aggregate principal amount of
$150,000 (the "Loan"), and bearing interest at a rate of 6.42% per annum,
compounded annually.
2. The Note. The Loan shall be evidenced by a full-recourse promissory
note executed and delivered by the Borrower in favor of the Company
substantially in the form attached hereto as Exhibit A (the "Note") with unpaid
principal and accrued interest due on the third anniversary of the date of the
Note, except as otherwise set forth on the Note or in this Agreement. The
Company hereby agrees to advance $150,000 to Borrower under the Loan upon the
effective date of this Agreement and Borrower's execution and delivery of the
Note in the form attached hereto as Exhibit A.
3. Acceleration of Loan. The principal and accrued interest under the
Loan shall immediately become due and payable in full upon the earliest to occur
of the following: (i) if on the 120th day after the date of this Agreement set
forth above Borrower has not completed the sale of his current residence located
at _______________, as demonstrated by documentation reasonably requested by the
Company, and relocated to the San Francisco Bay area in Northern California as
determined by the Company in its sole discretion; or (ii) within thirty (30)
days of the voluntary termination of Borrower's employment with the Company or
the termination of such employment for Cause (as defined below).
For these purposes, "Cause" shall mean the good faith judgment of the
Company's Board of Directors, that the Borrower has engaged in or committed any
of the following: (i) gross negligence or willful misconduct in the performance
of his duties to the Company where such gross negligence or willful misconduct
has resulted or is likely to result in substantial and material damage to the
Company or its subsidiaries, (ii) repeated unexplained or unjustified absence
from the Company, (iii) a material and willful violation of any federal or state
law, (iv) commission of any act of fraud with respect to the Company, (v) breach
of any confidentiality obligation to the Company, whether determined by
agreement or by applicable law; or (vi) conviction of a felony or a crime
involving moral turpitude causing material harm to
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the standing and reputation of the Company, in each case as determined in good
faith by the Board of Directors of the Company.
4. Partial Forgiveness of the Loan. The Company shall forgive the
outstanding principal and accrued interest under the Loan and such amount shall
no longer be payable to the Company as follows:
(a) one-third (1/3) of the original principal amount under the
Loan and any accrued interest shall be forgiven on each of the first three
anniversaries of the effective date of this Agreement, provided that Borrower is
an employee of the Company on each such anniversary date; and
(b) the entire amount of outstanding principal and accrued
interest under the Loan shall be forgiven upon completion of a termination
agreement with Borrower in the event of the separation of Borrower from the
Company due to any of the following: (i) the involuntary termination of
Borrower's employment with the Company for any reason other than for Cause; (ii)
the sale of all or substantially all of the Company's assets, (iii) the
liquidation, dissolution, consolidation, merger or other combination of the
Company (except a merger in which the Company is the surviving entity and the
shareholders of the Company immediately prior to the merger hold more than fifty
percent (50%) of the outstanding voting securities of the surviving entity);
(iv) the insolvency of the Company, the commencement of any act of bankruptcy by
the Company, the execution by the Company of a general assignment for the
benefit of creditors, or the filing by or against the Company of any petition in
bankruptcy or any petition for relief under the provisions under the Federal
bankruptcy laws or any other state or Federal law for the relief of debtors.
5. Default. Borrower shall be deemed to be in default of the Note and of
this Agreement in the event that payment of principal and accrued interest on
the Note shall be delinquent for a period of 10 days or more after it becomes
due.
6. No Employment Rights. Nothing contained in this Agreement or in any
of the attachments or exhibits hereto is intended or shall be construed to
confer upon the Borrower any rights to employment or continued employment with
the Company, or shall alter in any way the nature of Borrower's current
employment with the Company.
7. Successors and Assigns. This Agreement shall inure to the benefit of
the respective heirs, personal representatives, successors and assigns of the
parties hereto.
8. Governing Law. This Agreement and all acts and transactions pursuant
hereto and the rights and obligations of the parties hereto shall be governed,
construed and interpreted in accordance with the laws of the State of
California.
9. Arbitration; Dispute Resolution. Any dispute or claim arising out of
or in connection with this Agreement will be finally settled by binding
arbitration in San Francisco, California in accordance with the rules of the
American Arbitration Association by one arbitrator appointed in accordance with
said rules. The arbitrator shall apply California law, without
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reference to rules of conflicts of law or rules of statutory arbitration, to the
resolution of any dispute. Judgment on the award rendered by the arbitrator may
be entered in any court having jurisdiction thereof. Notwithstanding the
foregoing, the parties may apply to any court of competent jurisdiction for
preliminary or interim equitable relief, or to compel arbitration in accordance
with this paragraph, without breach of this arbitration provision. The
prevailing party in any such arbitration shall be entitled to an award of
attorneys' fees and costs of the arbitration against the other party.
10. Advice of Counsel. EACH PARTY TO THIS AGREEMENT ACKNOWLEDGES THAT,
IN EXECUTING THIS AGREEMENT, SUCH PARTY HAS HAD THE OPPORTUNITY TO SEEK THE
ADVICE OF INDEPENDENT LEGAL COUNSEL, AND HAS READ AND UNDERSTOOD ALL OF THE
TERMS AND PROVISIONS OF THIS AGREEMENT. THIS AGREEMENT SHALL NOT BE CONSTRUED
AGAINST ANY PARTY BY REASON OF THE DRAFTING OR PREPARATION HEREOF.
11. Entire Agreement. This Agreement constitutes the entire agreement of
the parties hereto with respect to the subject matter hereof and supersedes all
prior agreements and understandings related to such subject matter.
12. Modification. This Agreement shall not be amended without the
written consent of both parties hereto.
13. Severability. In the event that any provision hereof becomes or is
declared by a court of competent jurisdiction to be illegal, unenforceable or
void, this Agreement shall continue in full force and effect without said
provision.
14. Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
15. Notices. Any notice required or permitted by this Agreement shall be
in writing and shall be deemed sufficient upon receipt, when delivered
personally or by a nationally-recognized delivery service (such as Federal
Express or UPS) or confirmed facsimile, or forty-eight (48) hours after being
deposited in the U.S. mail as certified or registered mail with postage prepaid,
if such notice is addressed to the party to be notified at such party's address
or facsimile number as set forth below, or as subsequently modified by written
notice.
16. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.
17. Further Acts. Each party hereto agrees to execute, acknowledge and
deliver or to cause to have executed, acknowledged and delivered, such other and
further instruments and documents as may reasonably be requested by the other to
carry out the purposes of this Agreement.
[Signature Page Follows]
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first written above.
BORROWER: COMPANY:
XXXX.XXX, INC.,
a Delaware corporation
/s/ Xxxxx Xxxxx By: /s/ Xxxxx Xxxxxxxxxx
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XXXXX XXXXX
Title: Chief Executive Officer
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Address: Address: 000 Xxxxxxx Xxxxxx
------------------------ Xxx Xxxxxxxxx, XX 00000
Tel: (000) 000-0000
------------------------ Fax: (000) 000-0000
Tel:
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Fax:
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EXHIBIT A
PROMISSORY NOTE
$150,000.00 May 1, 2000
1. Obligation. For value received, XXXXX XXXXX (the "Borrower") promises
to pay to XXXX.XXX, INC., a Delaware corporation (the "Company"), the principal
sum of $150,000.00, with interest from the date hereof at a rate of 6.42% per
annum, compounded annually (the "Loan").
2. Payment. Subject to the terms and conditions set forth in that
certain Loan Agreement dated as of the date hereof between Borrower and the
Company (the "Loan Agreement"), including without limitation those provisions
which address acceleration of the maturity of the Loan and partial Loan
forgiveness under specified circumstances, the Loan shall be due and payable on
the third anniversary of the date hereof. Prepayment of all or any portion of
the principal and accrued interest owing under the Loan may be made at any time
without penalty. Payments shall be made in lawful money of the United States of
America.
3. Remedies on Default. Upon any default of the Borrower under this
Note, the Company may pursue any legal or equitable remedies that are available
to it.
4. Governing Law; Waiver. This Note shall be governed by and construed
in accordance with the laws of California, without reference to conflict of laws
principles. The Borrower waives presentment, notice of nonpayment, notice of
dishonor, protest, demand and diligence.
5. Attorneys' Fees. If suit is brought for collection of this Note, the
Borrower agrees to pay all reasonable expenses, including attorneys' fees,
incurred by the Company in connection therewith whether or not such suit is
prosecuted to judgment.
6. Full-recourse. This Note shall be full-recourse against Borrower.
7. Loan Agreement. This Note is made pursuant to the terms of the Loan
Agreement and is subject to the terms and conditions of that agreement.
IN WITNESS WHEREOF, the Borrower has caused this Note to be executed as
of the date and year first above written.
"BORROWER"
/s/ Xxxxx Xxxxx
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Xxxxx Xxxxx
/s/ JLW
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