Exhibit 2.2
SECURED BRIDGE FINANCING NOTE
Bellevue, Washington
April 3, 1998
1. FOR VALUE RECEIVED, CAMBIO NETWORKS, INC., a California corporation
(the "Borrower"), promises to pay to the order of MEADOWBROOK REHABILITATION
GROUP, INC., a Delaware corporation (the "Holder"), the principal sum (the
"Principal Sum") of Five Hundred Thousand Dollars ($500,000), or, if less, the
aggregate principal amount of all outstanding borrowings made by Holder to
Borrower for current operating expenses of Borrower pursuant to Schedule 1
attached hereto and made a part hereof. Xxxxxxxx promises to pay interest from
the date hereof on the advanced and unpaid amount of such Principal Sum and on
any accrued, unpaid and overdue installments of interest, on the dates and at
the rate of interest hereinafter set forth.
2. Term. Unless accelerated pursuant to the terms of this Note, the
unpaid portion of the Principal Sum and all accrued and unpaid interest thereon
shall be due and payable in full on the date (the "Maturity Date") that is the
earlier to occur of (i) the date on which the Agreement and Plan of Merger among
Holder, Borrower and Interset, Inc. dated as of April 3, 1998 closes; (ii) July
31, 1998; (iii) the date on which Borrower closes any equity or debt financing
in excess of $50,000 subsequent to the date hereof; (iv) the date on which all
or any significant portion of the assets or business of Borrower are sold or
otherwise transferred; or (v) the date on which there occurs any "change in
control" of Borrower (defined as a sale or other transfer, directly or
indirectly, of 30% or more of the beneficial voting or economic interest of
Borrower).
3. Interest. Interest, which shall be computed on the basis of the
actual number of days elapsed, shall accrue monthly on the advanced and unpaid
amount of the Principal Sum and on any then accrued and unpaid interest at the
rate of eight percent (8.0%) per annum until the Maturity Date, increasing by
and additional fifty (50) basis points at the end of each month thereafter for
so long as this Note is outstanding.
4. Place of Payment and Notice. Payments on this Note, as well as any
notices to Holder, are to be mailed or given to Holder at 0000 Xxxxxx Xxxxxx,
Xxxxx 0000, Xxxxxxxxxx, Xxxxxxxxxx 00000, or to such other place as Holder may
from time to time direct by written notice to Borrower. The address for notice
to Borrower shall be 000 XX 00xx Xxxxx, Xxxxx 000, Xxxxxxxx, Xxxxxxxxxx 00000,
or to such other place as Borrower may from time to time direct by written
notice to Holder.
5. Representations of Borrower. Borrower hereby represents and warrants
to Holder that (a) Borrower is a corporation duly organized and validly existing
in good standing under the laws of the State of California; (b) Borrower has all
necessary corporate power and authority to execute, deliver and perform its
obligations under this Note and consummate the transactions contemplated hereby;
and (c) the execution, delivery and performance of this Note and the
consummation of the transactions contemplated hereby have been duly authorized
by all necessary corporate action on the part of Borrower and do not violate or
conflict with, or, with or without the giving of notice, the passage of time or
both, constitute a default under, Borrower's charter documents, any law, rule,
regulation, order, writ, injunction or decree of any court, administrative
agency or any other governmental authority applicable to Borrower or any of its
properties or any agreement, instrument or commitment to which Borrower is a
party or by which Borrower or any of its property is bound.
6. Lawful Tender. All amounts payable hereunder shall be payable only
in lawful money of the United State of America. Each payment received by Holder
under this Note shall be applied first to the payment of accrued but unpaid
interest due hereunder and second to the Principal Sum. If any installment or
payment on this Note shall be due on Saturday, Sunday or a day which is a bank
holiday in the State of California, such payment shall be extended until the
following business day with accrued interest.
7. Prepayment. Borrower may make prepayments to Holder of the Principal
Sum at any time, in whole or in part, without premium or penalty.
8. Default.
(a) An "Event of Default" shall exist if any one or more of the
following events (collectively, "Events of Default") shall occur and be
continuing:
(i) Borrower shall fail to pay when due (whether by
acceleration or otherwise) any payment of principal or of interest on this Note,
and such failure continues for a period of five (5) days;
(ii) Any representation or warranty made by Borrower under
this Note shall prove to be untrue or inaccurate in any material respect as of
the date on which such representation or warranty is made;
(iii) Default shall occur in the performance of any of the
covenants or agreements of Borrower contained herein (other than payment
defaults), which is not remedied within thirty (30) days after delivery of
written notice to Borrower from Holder;
(iv) Default shall occur in the payment of any material
indebtedness of Borrower (or default shall occur in respect of any note, loan
agreement or credit agreement relating to such indebtedness or such indebtedness
shall become due before its stated maturity by acceleration thereof or shall
become due by its terms and shall not be promptly paid or extended) or a default
shall occur under any material agreement of Borrower, and such default shall
continue for more than the period of grace, if any, specified therein;
(v) Borrower or any subsidiary shall (A) apply for or consent
to the appointment of a receiver, trustee, custodian or liquidator or itself, of
all or substantially all of its assets, (B) file a voluntary petition in
bankruptcy, admit in writing that such person is unable to pay its debts as they
become due or generally not pay such debts as they become due, (C) make a
general assignment for the benefit of creditors, (D) file a petition or answer
seeking reorganization of any arrangement with creditors or to take advantage of
any bankruptcy, reorganization or insolvency proceeding, or (E) take corporate
action for the purpose of affecting any of the foregoing;
(vi) An involuntary petition or complaint shall be filed
against Borrower or any subsidiary seeking bankruptcy or reorganization of such
person or the appointment of a receiver, custodian, trustee or liquidator of
such person, or all or substantially all of such person's assets, or an order,
order for relief, judgment or decree shall be entered by any court of competent
jurisdiction or other competent authority approving a petition or complaint
seeking reorganization of Borrower or any subsidiary, or appointing a receiver,
custodian, trustee or liquidator of such person, or of all or substantially all
of such person's assets, and, in each case, such petition, order, judgment or
decree shall not have been dismissed within sixty (60) days of the filing
thereof; or
(vii) Any final judgment(s) for the payment of money in excess
of the sum of $50,000 in the aggregate shall be rendered against Borrower and
such judgment or judgments shall not be satisfied or discharged within thirty
(30) days of the date on which any such judgment is issued.
(b) If an Event of Default shall have occurred and be continuing, then
Holder may declare the unpaid Principal Sum of, and all interest then accrued
but unpaid on, this Note and any other liabilities hereunder to be forthwith due
and payable, whereupon the same shall forthwith become due and payable without
presentment, demand, protest, notice of default, notice of acceleration or of
intention to accelerate or other notice of any kind, all of which Borrower
hereby expressly waives.
(c) Each right, power or remedy of Holder upon the occurrence of any
Event of Default as provided for in this Note or now or hereafter existing at
law or in equity or by statute shall be cumulative and concurrent and shall be
in addition to every other right, power or remedy provided for in this Note or
now or hereafter existing at law or in equity or by statute, and the exercise or
beginning of the exercise by Holder of any one or more of such rights, powers or
remedies shall not preclude the simultaneous or later exercise by Holder of any
or all such other rights, powers or remedies.
(d) Upon the occurrence of an Event of Default, Xxxxxxxx agrees to pay
all costs and expenses (including Xxxxxx's attorneys' fees and expenses)
reasonably incurred by Xxxxxx in connection with the collection of amounts due
hereunder or the preservation and enforcement of Xxxxxx's rights hereunder, or
relating to any reorganization or workout in connection herewith.
9. CONSENT TO JURISDICTION. BORROWER HEREBY AGREES AND CONSENTS THAT
ANY ACTION, SUIT OR PROCEEDING ARISING OUT OF THIS NOTE MAY BE BROUGHT IN ANY
APPROPRIATE FEDERAL OR STATE COURT IN THE STATE OF CALIFORNIA, OR IN ANY OTHER
COURT HAVING JURISDICTION OVER THE SUBJECT MATTER, ALL AT THE SOLE AND EXCLUSIVE
ELECTION OF HOLDER, AND BY THE ISSUANCE AND EXECUTION OF THIS NOTE AND
ACCEPTANCE OF THE LOAN PROCEEDS BORROWER IRREVOCABLY CONSENTS TO THE
JURISDICTION AND VENUE OF EACH SUCH COURT AND HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF VENUE IN ANY SUCH COURT.
10. Waiver. No failure to exercise and no delay in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any right, power or privilege hereunder
preclude any other right, power or privilege. Amendments or waivers to this Note
may be made only in a written instrument executed by Xxxxxxxx and Xxxxxx.
11. Headings. The headings in this Note are for convenience of
reference only and do not constitute part of this Note.
12. Maximum Interest. The provisions of this Note shall not be
construed as requiring or committing Borrower to pay interest in excess of the
highest rate permitted by applicable law. If a court of competent jurisdiction
should determine that Xxxxxx has received interest in excess of such lawful
rate, such excess shall be applied to the reduction of the unpaid Principal Sum
due hereunder and not to the payment of interest.
13. Grant and Perfection of Security Interest. In order to secure the
due and punctual payment of the sums due hereunder, Borrower hereby grants,
transfers, conveys and assigns to Holder, and grants to Holder a security
interest in, Xxxxxxxx's presently existing or hereafter acquired rights, title
and interest in all of its tangible and intangible property, whether real or
personal, including, without limitation, all Accounts, Contract Rights,
Inventory, Equipment, General Intangibles, Chattel Paper, Deposit Accounts,
Goods, Documents, Instruments and Proceeds (each as defined in the Uniform
Commercial Code) of the foregoing (collectively, the "Collateral"); provided
however, that Xxxxxx's security interest in the Collateral shall be subordinate
to all security interests in the Collateral granted by Borrower and perfected
prior to the date hereof.
14. Attorneys' Fees. Should any litigation or other proceeding be
commenced by Borrower or Holder concerning this Note, or the rights and duties
of the parties in relation to this Note or any matter in connection herewith,
the party prevailing in such litigation or other proceeding shall be entitled,
in addition to such other relief as may be granted, to recover its reasonable
attorneys' fees and costs incurred in connection with such litigation or other
proceeding.
15. Further Assurances. From time to time after the date hereof and
without further consideration, Xxxxxxxx will execute and deliver, or arrange for
the execution and delivery of such other instruments of conveyance and transfer
or other instruments or documents and take or arrange for such other actions as
may reasonably be requested by Xxxxxx to complete more effectively the
transactions contemplated hereby, including, without limitation, as may be
necessary to implement the provisions of Section 13 above.
16. Governing Law. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF CALIFORNIA.
IN WITNESS WHEREOF, the undersigned Xxxxxxxx has caused this Note to be
duly executed on the date of issue above stated.
BORROWER:
CAMBIO NETWORKS, INC.,
a California corporation
By /s/ Xxxx Xxxxx
Its President & COO
Address:
000 XX 00xx Xxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx 00000
