EXHIBIT 10.35
--------------------------------------------------------------------------------
AMENDED AND RESTATED
CREDIT AGREEMENT
Between
LOUDEYE TECHNOLOGIES, INC.
as Lender
▇▇▇▇▇▇ ▇▇▇▇▇▇
as Borrower
and
▇▇▇▇ ▇▇▇▇▇▇ and ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ PROPERTIES, LLC,
a Washington limited liability company
as Additional Parties
Dated as of November 30, 2001
TABLE OF CONTENTS
Page
----
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS....................................................1
ARTICLE II AMOUNTS AND TERMS OF ADVANCES......................................................4
Section 2.1 The Commitment..........................................................4
Section 2.2 The Advances............................................................4
Section 2.3 Minimum and Maximum Advance Amount......................................4
Section 2.4 Frequency of Advances...................................................5
Section 2.5 Requests for Advances; Advances by Lender...............................5
Section 2.6 Interest Rates; Late Charges............................................5
Section 2.7 Repayment of Principal; Maturity........................................5
Section 2.8 Evidence of Debt........................................................6
Section 2.9 Payments and Computations...............................................6
Section 2.10 Prepayments.............................................................6
Section 2.11 Termination of Advances.................................................7
ARTICLE III COLLATERAL........................................................................7
Section 3.1 Generally...............................................................7
Section 3.2 Additional Documents....................................................8
Section 3.3 Title Policies..........................................................8
Section 3.4 Release of Collateral...................................................8
Section 3.5 Subordination of ▇▇▇▇ Street Deed of Trust..............................9
Section 3.6 Application of Sales Proceeds...........................................9
Section 3.7 Covenants of Additional Parties.........................................9
ARTICLE IV CONDITIONS OF BORROWING............................................................10
Section 4.1 Conditions Precedent to Initial Borrowing...............................10
Section 4.2 Conditions Precedent to Each Borrowing..................................11
ARTICLE V REPRESENTATIONS AND WARRANTIES......................................................12
Section 5.1 Authorization; No Breach................................................12
Section 5.2 Financial Information...................................................12
Section 5.3 Legal Effect............................................................12
Section 5.4 Real Properties.........................................................12
Section 5.5 Names.................................................................. 12
Section 5.6 Compliance with Law.....................................................12
Section 5.7 Hazardous Substances....................................................12
Section 5.8 Litigation and Claims...................................................13
Section 5.9 Taxes.................................................................. 13
Section 5.10 Lien Priority...........................................................13
Section 5.11 Borrower's Residence....................................................13
Section 5.12 Information.............................................................13
Section 5.13 Survival of Representations and Warranties..............................13
i
Page
----
Section 5.14 Business Purpose........................................................13
ARTICLE VI COVENANTS..........................................................................13
Section 6.1 Payment of Indebtedness.................................................13
Section 6.2 Changes in Financial Condition; Litigation..............................14
Section 6.3 Financial Statements and Tax Returns....................................14
Section 6.4 Compliance With Law.....................................................14
Section 6.5 Use of Proceeds.........................................................14
Section 6.6 Additional Assurances...................................................14
ARTICLE VII DEFAULT AND REMEDIES..............................................................15
Section 7.1 Events of Default.......................................................15
Section 7.2 Remedies................................................................16
Section 7.3 Cumulative Remedies.....................................................16
Section 7.4 Application of Payments.................................................16
Section 7.5 Good Faith Negotiation..................................................16
If Borrower cannot repay principal and accrued interest in full upon the
maturity of the Note, Borrower and Lender shall in good
faith attempt to negotiate an extension of the term of the
Note upon commercially reasonable terms and conditions. If
no agreement is reached within two weeks of the maturity
date of the Note, then the parties obligation to continue
to negotiate an extension shall terminate. Nothing in this
section shall require either Lender or Borrower to agree
upon any such
extension...............................................................16
ARTICLE VIII MISCELLANEOUS....................................................................16
Section 8.1 Amendments..............................................................16
Section 8.2 Notices.................................................................17
Section 8.3 No Waiver; Remedies.....................................................17
Section 8.4 Costs and Expenses; Indemnification.....................................17
Section 8.5 Binding Effect; Assignments and Participations..........................18
Section 8.6 Execution in Counterparts...............................................18
Section 8.7 Governing Law...........................................................18
Section 8.8 Jurisdiction and Venue; Waive of Jury Trial.............................18
Section 8.9 No Fiduciary Duty.......................................................19
Section 8.10 Severability............................................................19
Section 8.11 Entire Agreement........................................................20
Section 8.12 Descriptive Headings....................................................20
Section 8.13 Gender and Number.......................................................20
EXHIBIT A FORM OF NOTE
EXHIBIT B REQUEST FOR ADVANCE
ii
AMENDED AND RESTATED
CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT (this "Agreement") dated as
of November 30, 2001 is made by and between ▇▇▇▇▇▇ ▇▇▇▇▇▇ ("Borrower"), ▇▇▇▇
▇▇▇▇▇▇, wife of Borrower, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ PROPERTIES, LLC, a Washington limited
liability company ("▇▇ ▇▇▇▇ ▇▇▇▇▇▇" and collectively with ▇▇▇▇ ▇▇▇▇▇▇,
"Additional Parties") and LOUDEYE TECHNOLOGIES, INC., a Delaware corporation
("Lender").
This Agreement is intended to amend, restate, and supersede in its
entirety that certain Credit Agreement executed by the parties hereto and dated
as of October 26, 2001.
RECITALS
Borrower has requested that Lender make loan advances to him from time
to time. Subject to the terms and conditions of this Agreement and of the other
Loan Documents (as defined below) Lender is willing to extend certain credit to
Borrower as provided in this Agreement.
Accordingly, the parties agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
As used in this Agreement, the following terms shall have the following
meanings (such meanings to be equally applicable to both the singular and plural
forms of the terms defined):
"Account Control Agreement" means the Account Control Agreement dated
January 30, 2001 between ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Inc., fka FleetBoston ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ Inc., Loudeye Technologies, Inc. and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
"Advance" means an advance by Lender to Borrower pursuant to Article II
hereof.
"Amendments" means the Amendment to the Account Control Agreement, and
the Amendment to the Security Agreement, to be executed pursuant to the terms
hereof.
"▇▇▇▇ Street Deed of Trust" has the meaning specified in Section 3.1(a).
"Borrower" has the meaning specified in the preamble to this Agreement.
"Business Day" means a day which is not a Saturday, Sunday or other day
on which banks are required or authorized to close in Seattle, Washington.
1
"Collateral" means the collateral described in, and all items of real
and personal property in which Lender holds a Lien to secure the credit
facilities provided for in this Agreement under, the Security Agreement (as
amended), the Account Control Agreement (as amended), the Deeds of Trust, or any
other Loan Document at any time now or hereafter in effect between Lender and
Borrower.
"Commitment" has the meaning specified in Section 2.1.
"Deeds of Trust" means collectively the ▇▇▇▇ Street Deed of Trust and
the Union Street Second Deed of Trust.
"Default" has the meaning specified in the definition of "Event of
Default."
"Default Rate" has the meaning specified in Section 2.4(b).
"Effective Date" means the earlier of (a) the date of the first
Borrowing under this Agreement or (b) the Business Day on which Lender notifies
Borrower in writing that all conditions precedent to the making of Advances
under this Agreement set forth in Article III have been satisfied or waived in
writing by Lender.
"Event of Default" means any of the events specified in Section 7.1,
provided that there has been satisfied any requirement in connection with such
event for the giving of notice, or the lapse of time, or the happening of any
further condition, event or act, and "Default" shall mean any of such events,
whether or not any such requirement has been satisfied.
"Existing Deed of Trust" means the first lien Deed of Trust, Assignment
of Rents, Security Agreement and Fixture Filing dated January 30, 2001, granted
by ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ to Lender to secure certain obligations of Borrower to Lender,
and encumbering the ▇▇▇▇ Street Property, and recorded under King County
Auditor's File No. 20010207000583.
"Existing Title Policy" means the mortgagee's policy of title insurance
in favor of Lender issued by Chicago Title Insurance Company under its Order No.
586833, insuring the lien of the Existing Deed of Trust.
"Indebtedness" means the entire balance of principal, interest, fees,
costs, advances, and any other sums owed at any time to Lender by Borrower, by
▇▇ ▇▇▇▇ ▇▇▇▇▇▇, by Tobiases, or by the owner of any of the other Collateral,
pursuant to this Agreement or any of the other Loan Documents.
"Insolvency Proceeding" means any proceeding commenced by or against any
Person under any provision of the United States Bankruptcy Code, as amended, or
under any other bankruptcy or insolvency law, any assignment for the benefit of
creditors, or any other proceeding seeking reorganization, arrangement or other
relief from Indebtedness.
2
"Lien" means any mortgage, pledge, security interest, encumbrance, lien
or charge of any kind (including any agreement to give any of the foregoing, any
conditional sale or other title retention agreement, any lease in the nature
thereof, and the filing of or agreement to give any financing statement under
the Uniform Commercial Code of any jurisdiction).
"Loan Documents" means this Agreement, the Note, the Deeds of Trust, the
Security Agreement and the Account Control Agreement as modified by the
Amendments, and all other documents, instruments and agreements related thereto.
"Material Adverse Effect" means any material adverse effect on: (a) the
assets, capitalization, property, condition (financial or otherwise) or
prospects of Borrower; (b) the value of the Collateral or the validity,
perfection or priority of the liens of Lender on the Collateral; or (c) the
ability of Borrower to pay and perform its obligations as they become due,
including all obligations under the Loan Documents.
"Note" means the promissory note payable to the order of Lender in the
form of EXHIBIT A hereto evidencing the aggregate indebtedness of Borrower to
Lender under this Agreement.
"Permitted Liens" means (a) Liens securing Indebtedness owed by Borrower
to Lender, (b) Liens for taxes, assessments or similar charges not yet
delinquent, (c) the Union Street First Deed of Trust, and (d) Liens which have
been disclosed to and approved by Lender in writing.
"Person" means an individual, partnership, corporation (including a
business trust), joint stock company, limited liability company, trust,
unincorporated association, joint venture or other entity, or any governmental
authority or entity.
"Prime" means the prime rate of interest published from time to time in
the Wall Street Journal.
"Real Property Collateral" means the real and personal property
encumbered by the ▇▇▇▇ Street Deed of Trust and the Union Street Second Deed of
Trust.
"Security Agreement" means that certain Security Agreement between
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and Lender, dated January 30, 2001, pursuant to which a
security interest was granted to Lender in 4,383,123 shares of stock of Loudeye
Technologies, Inc.
"Security Documents" means the Deeds of Trust, the Security Agreement,
the Account Control Agreement, and all other documents, instruments and
agreements (a) under which any Person grants a security interest to Lender for
the purpose of securing the obligations of Borrower contained in this Agreement,
the Note and the other Loan Documents, or (b) which relate to the perfection of
such a security interest, as the same may be amended, supplemented, extended or
replaced from time to time.
"Stock" means the stock in Loudeye Technologies, Inc., pledged pursuant
to the Security Agreement and the Account Control Agreement.
3
"Stock Certificates" means the certificates evidencing the Stock.
"Termination Date" has the meaning specified in Section 2.11 hereof.
"Title Insurer" means Chicago Title Insurance Company.
"Title Policies" means the policies of title insurance to be issued to
Beneficiary pursuant to Section 3.3 hereof, insuring the liens of the Deeds of
Trust in form and content satisfactory to Lender, and with respect to the ▇▇▇▇
Street Property shall mean the endorsements to the Existing Title Policy to the
extent Lender accepts such endorsements in lieu of a new Title Policy on the
▇▇▇▇ Street Property, as provided in Section 3.3 hereof.
"Union Street First Deed of Trust" means the deed of trust executed by
Tobiases as Grantor in favor of Columbia Bank as Beneficiary, Loan No.
2679379340001 recorded under King County Auditor's File No. 9806191831,
encumbering the Union Street Property and securing an indebtedness in the
original principal amount of $578,000.
"Union Street Second Deed of Trust" has the meaning specified in Section
3.1(b).
"Union Street Property" has the meaning specified in Section 3.1(b).
"Unused Commitment" means, as of any date of determination, an amount
equal to the Commitment minus the sum of: (a) the aggregate principal amount of
all Advances that have been made by Lender to date, regardless of the
then-outstanding balance thereof, and (b) the aggregate principal amount of
Advances for which a Request for Advance has been made pursuant to Section 2.3
but which have not been disbursed as of the date of determination.
ARTICLE II
AMOUNTS AND TERMS OF ADVANCES
Section 2.1 The Commitment. Subject to the terms and conditions of this
Agreement, Lender shall make available to Borrower a non-revolving credit
facility in the maximum principal amount of Two Million Dollars ($2,000,000)
(the "Commitment").
Section 2.2 The Advances. Lender agrees, on the terms and conditions set
forth below, during the period from the Effective Date to the Termination Date,
to make Advances to Borrower from time to time on any Business Day. Lender shall
have no obligation to make any Advances on or after the Termination Date
(defined below).
Section 2.3 Minimum and Maximum Advance Amount. Each request for an
Advance shall be in an amount not less than $50,000, and not greater than the
greater of (A) the Unused Commitment, or (B) the sum of $1,000,000 plus one-half
of the then market value (determined by reference to its price on the Nasdaq
stock exchange) of all of the Stock. Advances shall be in amounts representing
multiples of $10,000 above the $50,000 minimum advance amount specified above.
4
Section 2.4 Frequency of Advances. In no event shall Borrower be
entitled to more than two Advances in any calendar month.
Section 2.5 Requests for Advances; Advances by Lender. Each request for
an Advance hereunder shall be made by Borrower to Lender in writing and shall be
in the form of EXHIBIT B hereto (each such request being referred to as a
"Request for Advance"). Provided Borrower is then entitled to receive such
Advance pursuant to the terms hereof, Lender shall make Advances to Borrower in
immediately available funds to an account of Borrower approved by Lender, within
three (3) business days following Lender's receipt of the Request for Advance.
Borrower and Additional Parties shall provide Lender with such information and
reports as may be necessary for Lender to verify that Borrower is entitled to
receive an Advance hereunder.
Section 2.6 Interest Rates; Late Charges.
(a) Advances. Borrower shall pay interest on the unpaid principal
outstanding hereunder from time to time, at a variable rate equal to Prime plus
one percent (1%) per annum, adjusted monthly based on the Prime in effect on the
first day of each calendar month during the term hereof.
(b) Default Rate. Notwithstanding any contrary provision of this
Agreement or any other Loan Document, after the occurrence and during the
continuance of an Event of Default, and without notice or demand, all principal,
interest and other amounts owing under this Agreement, the Note and the other
Loan Documents shall bear interest at a rate per annum equal at all times to the
otherwise applicable interest rate plus five percent (5%). No election by Lender
not to charge the Default Rate with respect to an Event of Default shall in any
way limit Lender's right to later charge the Default Rate with respect to the
same or any other Event of Default, whether of a similar or a different nature.
(c) Late Charge. If any payment due hereunder is ten (10) days or
more late, Borrower shall pay to Lender a late fee equal to two percent (2%) of
such payment or $25.00, whichever is greater; provided that no such amount shall
be charged on or after the date on which Lender has declared all amounts owing
hereunder to be due and payable as provided in Section 7.2.
(d) Maximum Interest. In no event shall charges constituting
interest payable by Borrower to Lender exceed the maximum amount permitted under
any applicable law or regulation, and if any payments by Borrower exceed such
maximum amount, the excess shall be applied first to reduce the amounts owing to
Lender under this Agreement and the other Loan Documents in such order as Lender
may elect, next to reduce any other amounts owing by Borrower to Lender in such
order as Lender may elect, and any excess shall be refunded to Borrower.
Section 2.7 Repayment of Principal; Maturity. The entire outstanding
balance of principal, interest, fees, costs, advances and any other amounts owed
by Borrower to Lender hereunder and under the other Loan Documents will be due
and payable in full on June 30, 2003.
5
Section 2.8 Evidence of Debt. The Advances made by Lender to Borrower
shall be evidenced by the Note, payable to the order of Lender. Lender may
maintain an account or accounts evidencing the Indebtedness of Borrower
resulting from Advances hereunder and other sums owed by Borrower pursuant to
the Loan Documents, and payments made from time to time under this Agreement. In
any legal action or proceeding in respect of this Agreement or the Note, the
entries made in such account or accounts shall be presumptive evidence of the
existence and amounts of the obligations of Borrower therein recorded absent
manifest error.
Section 2.9 Payments and Computations.
(a) Borrower shall pay all interest accruing on the outstanding
principal balance of the Indebtedness hereby evidenced in arrears on the first
day of each calendar month; provided, however, that so long as no Event of
Default is pending hereunder or under any of the other Loan Documents, Borrower
may elect, by written notice to Lender prior to the date when any monthly
payment of interest would otherwise be payable, to have the interest accruing
hereunder added to and become part of the principal balance of the indebtedness
hereby evidenced on the first day of every third calendar month during the term
hereof, and such quarterly capitalization of interest shall continue until
Borrower rescinds such election by written notice to Lender, or until the
occurrence of an Event of Default hereunder.
(b) Borrower shall make each payment hereunder and under the
Note, without offset or deduction of any kind, on the day when due in U.S.
Dollars to Lender at ▇▇▇ ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, or at such
other location designated by notice from Lender pursuant to the notice provision
of this Agreement, in immediately available funds. Any payment received by
Lender after such time shall be deemed to have been received on the next
succeeding Business Day.
(c) All computations of interest shall be made by Lender on the
basis of a year of 360 days, in each case for the actual number of days
(including the first day but excluding the last day) occurring in the period for
which such interest or fees are payable. Each determination by Lender of an
interest rate or an increased cost or of illegality hereunder shall be
presumptive evidence thereof and binding for all purposes absent manifest error.
(d) At the maturity date of the Note, in its sole discretion,
Lender may accept as payment for principal or interest then due thereunder,
shares of common stock of Loudeye Technologies, Inc. owned by Borrower and
pledged as collateral to secure Borrower's obligations thereunder. In the event
that Borrower desires to make payments in Loudeye shares and Lender is willing
to accept such shares in payment, the shares shall be valued at 80% of the
closing bid price of Loudeye common stock on the maturity date on the Nasdaq
Stock Market or such other market that is the principal trading market for
shares of Loudeye common stock as of such date.
Section 2.10 Prepayments. Borrower may prepay its obligation hereunder
in full or in part at any time without premium or penalty.
6
Section 2.11 Termination of Advances. Notwithstanding any other
provision hereof or of any other documents or instruments executed in connection
with the credit facility described herein, no further Advances shall be made by
Lender hereunder on or after that date (the "Termination Date") which is the
earliest to occur of the following:
(a) January 31, 2003;
(b) The date on which an Event of Default occurs as described in
Section 7.1 hereof;
(c) The date on which the common stock of Loudeye Technologies,
Inc. is de-listed from the Nasdaq National Market System; or
(d) The date the ▇▇▇▇ Street Deed of Trust or the Union Street
Second Deed of Trust is reconveyed, or that the lien of the ▇▇▇▇ Street Deed of
Trust is subordinated by Lender to any other lien against the ▇▇▇▇ Street
Property.
ARTICLE III
COLLATERAL
Section 3.1 Generally. The obligations of Borrower to Lender hereunder
and under the Note shall be secured by the following Collateral:
(a) A first lien Deed of Trust, Security Agreement, Assignment of
Leases and Rents and Fixture Filing, in form and content satisfactory to Lender
encumbering the real property located at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
owned by ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ Properties LLC, a Washington limited liability company
("55 ▇▇▇▇ Street"), encumbering certain real property owned by ▇▇ ▇▇▇▇ ▇▇▇▇▇▇
and the leases and rents and personal property related thereto and associated
therewith (the "▇▇▇▇ Street Deed of Trust"); alternatively, in Lender's sole
discretion, Lender may elect to require Borrower to execute and deliver to
Lender a modification of the Existing Deed of Trust in such form and on such
terms as Lender may require, and if Lender elects to require such a modification
in lieu of a new deed of trust, the term "▇▇▇▇ Street Deed of Trust" as used
herein shall be deemed to refer to such modification agreement.
(b) A second lien Deed of Trust, Security Agreement, Assignment
of Leases and Rents, and Fixture Filing, in form and content satisfactory to
Lender, encumbering the real property located at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, owned by ▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇, husband and wife
("Tobiases"), encumbering certain real property described therein (the "Union
Street Property") owned by Tobiases, and the leases and rents and personal
property related thereto and associated therewith (the "Union Street Second Deed
of Trust"), and subject to no senior monetary liens other than the Union Street
First Deed of Trust; in conjunction with the recording of such Deed of Trust the
holder of the Union Street First Deed of Trust must agree in writing in favor of
Lender to provide Lender with written notice of
7
defaults of Borrower under the Union Street First Deed of Trust and an
opportunity to cure such defaults prior to acceleration of the indebtedness
secured thereby;
(c) UCC-1 financing statements, evidencing Lender's security
interest in any tangible and intangible personal property used in connection
with the real property described in the Deeds of Trust;
(d) A first lien pledge of 4,600,000 shares of common stock in
Lender owned by Borrower, pursuant to the Security Agrement and the Account
Control Agreement as amended by the Amendments in form and content satisfactory
to Lender and UCC-1 Financing Statements in favor of Lender as are required
pursuant to such Agreement; and
Section 3.2 Additional Documents. In addition to the Deeds of Trust, ▇▇
▇▇▇▇ ▇▇▇▇▇▇ and Tobiases shall be required to execute and deliver to Lender, at
Lender's request, a hazardous substance indemnification agreement and an
assignment of leases and rents with respect to the ▇▇▇▇ Street Property and the
Union Street Property, respectively.
Section 3.3 Title Policies. As a condition of receiving any Advances
hereunder, Borrower shall provide Lender, at Borrower's sole cost and expense,
with ALTA extended coverage mortgagee's policies of title insurance issued by
the Title Insurer, each in the amount of $2,000,000 (with pro tanto
endorsements), insuring the ▇▇▇▇ Street Deed of Trust and the Union Street
Second Deed of Trust (collectively, the "Deeds of Trust") as a first lien and a
second lien, respectively, against each such property subject to no exceptions
for creditors' rights and no other exceptions except as are acceptable to Lender
in its discretion, and containing such endorsements as Lender may require in its
discretion. As an alternative to a new title policy insuring the ▇▇▇▇ Street
Deed of Trust, Lender may in its discretion accept a modification endorsement
and such other endorsements as Lender may require, at Borrower's sole cost and
expense, to the Existing Title Policy, in form and content satisfactory to
Lender and providing coverage comparable in Lender's discretion to that
described above, if Lender accepts a modification of the Existing Deed of Trust
in lieu of a new ▇▇▇▇ Street Deed of Trust as provided in Section 3.1 hereof.
Section 3.4 Release of Collateral. Provided that at the time Borrower
shall request that Lender release (or subordinate, as applicable) its lien and
encumbrance on any of the Collateral described hereinabove, there is no default
or Event of Default pending hereunder or under any of the other Loan Documents,
nor has any event occurred that with the passage of time, the giving of notice,
or the lapse of any period of grace ripen into a default, Borrower may obtain
the release of the Collateral upon written request to Lender under the following
terms and conditions:
(a) Lender shall fully reconvey the ▇▇▇▇ Street Deed of Trust at
such time as the outstanding balance of principal, together with any outstanding
interest that is to be capitalized pursuant to a notice given to Lender pursuant
to Section 2.8(a) hereof, is $1,000,000 or less, provided that in Lender's
reasonable judgment, the remaining Collateral pledged by Borrower is adequate to
secure the Indebtedness;
8
(b) Lender shall fully reconvey the Union Street Second Deed of
Trust upon receipt of the Net Sales Proceeds (defined below) (if any) received
by Tobiases in a sale of the Union Street Property on terms and conditions
acceptable to Lender in its discretion; for purposes hereof, "Net Sales
Proceeds" shall mean the actual sales price of such property paid in an arms'
length sale, less the outstanding balance of the indebtedness secured by the
Union Street First Deed of Trust, reasonable and customary prorations and
closing costs (including without limitation, real estate excise tax, escrow
fees, title insurance premiums, and commercially reasonable brokerage
commissions paid to parties unaffiliated with Tobiases).
(c) Lender shall release its security interest in some or all of
the Stock upon a sale of such Stock by the owner thereof that is approved in
writing by Lender, at a price approved in writing by Lender, provided that all
proceeds of such sale net of reasonable brokerage commissions, are delivered to
Lender.
Notwithstanding any provision hereof seemingly to the contrary, in no event
shall Lender release the last remaining Collateral without repayment in full of
the entire Indebtedness. Lender agrees to deliver such documentation as may be
reasonably necessary to accomplish the release or reconveyance of Collateral as
described above within ten (10) business days after any preconditions to such
release or reconveyance have been satisfied.
Section 3.5 Subordination of ▇▇▇▇ Street Deed of Trust. Lender shall
subordinate the lien of the ▇▇▇▇ Street Deed of Trust to the lien of a new deed
of trust in favor of an institutional lender to secure a construction loan to ▇▇
▇▇▇▇ ▇▇▇▇▇▇, provided that (i) at the time Borrower requests such subordination
there is no default or Event of Default pending hereunder or under any of the
other Loan Documents, nor has any event occurred that with the passage of time,
the giving of notice, or the lapse of any period of grace ripen into a default;
(ii) Lender fully approves, in its reasonable discretion, the nature and scope
of the proposed construction and improvement work and its potential impact on
the value of the ▇▇▇▇ Street Property, based on Lender's review of such plans
and specifications for the construction project, construction contractor and
architect's contracts, development agreements, appraisals, building and
development permits and licenses, income projections, credentials of the
proposed architect or contractor, and other information regarding the proposed
construction project that Lender may request of Borrower; (iii) the documents
and instruments evidencing and securing such construction loan are satisfactory
to Lender in its reasonable discretion; and (iv) Lender is provided by such
construction lender with a written commitment to provide Lender with written
notice of defaults by ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ under such construction loan and an
opportunity to cure the same.
Section 3.6 Application of Sales Proceeds. Lender may apply the amounts
paid to it by reason of sale of any of the Collateral as described herein first
against fees, costs, advances and late charges, if any, that are outstanding
pursuant to any of the Loan Documents; then against outstanding unpaid interest,
and then against the principal balance hereof.
Section 3.7 Covenants of Additional Parties.
9
(a) ▇▇▇▇ ▇▇▇▇▇▇ hereby consents to the terms of this Agreement
and the Note and confirms and agrees that the community property interest of
Borrower and ▇▇▇▇ ▇▇▇▇▇▇, as well as any separate property of Borrower, are
bound by all covenants and agreements of Borrower. ▇▇▇▇ ▇▇▇▇▇▇ hereby agrees to
cooperate fully in providing Lender with any financial statements or tax returns
required of Borrower hereunder. ▇▇▇▇ ▇▇▇▇▇▇ further agrees to join in the
execution of the Union Street Second Deed of Trust and to cooperate in providing
the Title Insurer with such affidavits and certificates necessary for the
issuance of the Title Policy on the Union Street Property.
(b) ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ hereby consents to the terms of this Agreement
and agrees to cooperate in the execution and delivery of the ▇▇▇▇ Street Deed of
Trust on the terms and conditions set forth herein. ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ hereby agrees
to cooperate fully in providing Lender with any financial statements or tax
returns required of ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ hereunder, and in providing any information
regarding any proposed construction project and construction loan affecting the
▇▇▇▇ Street Property, as described in Section 3.5 hereof. In addition, ▇▇ ▇▇▇▇
▇▇▇▇▇▇ agrees to execute and deliver to the Title Insurer such financial
statements, affidavits, certificates and organizational documents and
resolutions as are necessary for the Title Insurer to issue the Title Policy on
the ▇▇▇▇ Street Property consistent with the requirements hereof.
ARTICLE IV
CONDITIONS OF BORROWING
Section 4.1 Conditions Precedent to Initial Borrowing. The obligation of
Lender to make the initial Advance hereunder is subject to the following
conditions precedent:
(a) Lender shall have received the following documents in form
and substance satisfactory to Lender and duly executed by the parties thereto:
(i) The Note;
(ii) The Amendments;
(iii) The Deeds of Trust; and
(iv) The other documents referenced in Section 3 hereof.
(b) A current personal financial statement and a copy of the most
recent federal income tax return, for (i) Borrower and ▇▇▇▇ ▇▇▇▇▇▇ and (ii) ▇▇
▇▇▇▇ ▇▇▇▇▇▇.
(c) Irrevocable commitment of the Title Insurer to issue in favor
of Lender the Title Policies.
(d) Evidence satisfactory to Lender that all insurance coverage
required pursuant to the terms of the Deeds of Trust is in full force and effect
with respect to the Real Property Collateral.
10
(e) Evidence that the execution and delivery of the ▇▇▇▇ Street
Deed of Trust has been duly authorized by all necessary action of ▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Properties LLC.
(f) Evidence that any required authorizations and approvals have
been granted to allow Borrower, acting in a trustee capacity, to execute and
deliver the Amendments the Security Agreement and the Account Control Agreement,
as so amended, purport to encumber any Stock owned by a trust rather than by
Borrower individually.
(g) Payment of all fees and closing costs and expenses of Lender
(including without limitation, attorneys' fees, title insurance premiums, escrow
fees, and recording fees) due pursuant to Section 8.4(a) hereof.
Section 4.2 Conditions Precedent to Each Borrowing. The obligation of
Lender to make Advances shall be subject to the following further conditions
precedent that, on the date of an Advance pursuant to Section 2.4 hereof, the
following statements shall be true and correct, and the making by Borrower of
the applicable Request for Advance shall constitute its representation and
warranty that as of the date such Request for Advance is given, the following
statements are true and correct:
(i) The representations and warranties contained in
Article V of this Agreement, in each of the Deed of Trust, in the Security
Agreement, and in any of the other Loan Documents are correct in all material
respects as though made on and as of such date, unless such representations and
warranties are expressly stated to be made as of an earlier date;
(ii) No event has occurred and is continuing, or would
result from such Borrowing, conversion or continuation, which constitutes or
would constitute an Event of Default or Default;
(iii) The most recent financial statements of Borrower
delivered pursuant to Section 6.3 present fairly the financial position of
Borrower as of the date of, and for the periods presented in, such financial
statements, and since the date of such financial statements there has not been
any material adverse change in the financial condition of Borrower; and
(iv) Borrower is in compliance with all covenants
contained in Article VI of this Agreement.
11
ARTICLE V
REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants to Lender as follows:
Section 5.1 Authorization; No Breach. The execution, delivery, and
performance of this Agreement and all other Loan Documents by Borrower, to the
extent to be executed, delivered or performed by Borrower, do not require the
consent or approval of any other person, regulatory authority or governmental
body; and do not conflict with, result in a violation of, or constitute a
default under any agreement or other instrument binding upon Borrower or (b) any
law, governmental regulation, court decree, or order applicable to Borrower.
Section 5.2 Financial Information. Each financial statement of Borrower
supplied to Lender truly and completely disclosed Borrower's financial condition
as of the date of the statement, and there has been no material adverse change
in Borrower's financial condition subsequent to the date of the most recent
financial statement supplied to Lender. Borrower has no material contingent
obligations except as disclosed in such financial statements.
Section 5.3 Legal Effect. This Agreement constitutes, and any instrument
or agreement required hereunder to be given by Borrower when delivered will
constitute, legal, valid and binding obligations of Borrower enforceable against
Borrower in accordance with their respective terms, subject to applicable
bankruptcy, insolvency or similar laws affecting creditors' rights generally and
to general principles of equity (whether considered in a proceeding at law or in
equity).
Section 5.4 Real Properties. Except for Permitted Liens and real
property leases, Borrower owns and has good title to the Real Property
Collateral free and clear of all Liens, and has not executed any mortgages,
deeds of trust, security documents or financing statements relating to such
properties.
Section 5.5 Names. Borrower's full legal name is exactly as shown in the
first paragraph of this Agreement. Borrower has not used, or filed a financing
statement under, any name other than its true legal name for at least the last
five (5) years. All of Borrower's properties are titled in Borrower's true legal
name.
Section 5.6 Compliance with Law. The Real Property Collateral is in
compliance with all applicable laws, rules, regulations and court and
administrative orders, except to the extent that failure so to comply could not
reasonably be expected to have a Material Adverse Effect.
Section 5.7 Hazardous Substances. The Real Property Collateral is in all
material respects in compliance with all applicable laws and regulations
relating to the environment, including without limitation, all laws and
regulations relating to pollution and environmental control.
12
Section 5.8 Litigation and Claims. No litigation, claim, investigation,
administrative proceeding or similar action (including those for unpaid taxes)
against Borrower or the Real Property Collateral is pending or threatened, and
no other event has occurred which could reasonably be expected to have a
Material Adverse Effect.
Section 5.9 Taxes. All tax returns and reports of Borrower that are
required to have been filed, have been filed, and all taxes, assessments and
other governmental charges which have become due and payable by Borrower have
been paid in full, except those presently being or to be contested by Borrower
in good faith, by appropriate proceedings.
Section 5.10 Lien Priority. Except for Permitted Liens, there is no Lien
on or affecting any of the Collateral that would be prior to Lender's Lien on
and security interest in such Collateral.
Section 5.11 Borrower's Residence. Borrower's principal residence is
located at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Section 5.12 Information. All information furnished by Borrower to
Lender in connection with this Agreement or any transaction contemplated hereby
is, and all information hereafter furnished by or on behalf of Borrower to
Lender will be, true and accurate in every material respect on the date as of
which such information is dated or certified; and none of such information is or
will be incomplete by omitting to state any material fact necessary to make such
information not misleading.
Section 5.13 Survival of Representations and Warranties. Borrower
understands and agrees that Lender, without independent investigation, is
relying upon the above representations and warranties in entering into this
Agreement and the other Loan Documents. Such representations and warranties
shall be continuing in nature and shall remain true and correct until all of the
Indebtedness has been paid in full, or until Lender's Commitment to make
Advances hereunder has been permanently terminated in writing, whichever is the
last to occur.
Section 5.14 Business Purpose. The proceeds of the Advances will be used
principally for business and commercial purposes, and not principally for
personal, household or consumer purposes.
ARTICLE VI
COVENANTS
So long as the Note or any other amount payable by Borrower under the
Loan Documents shall remain unpaid or Lender shall have any Commitment
hereunder, Borrower covenants and agrees that:
Section 6.1 Payment of Indebtedness.
13
He will pay when due pursuant to the terms of this Agreement and the other Loan
Documents all obligations accruing thereunder, including without limitation any
fees, costs, expenses incurred by and advances made by Lender pursuant to the
terms of either of the Deeds of Trust, or pursuant to the Security Agreement or
the Control Agreement, as amended. All such sums (other than principal and
interest accruing hereunder) shall be paid by Borrower to Lender within five (5)
Business Days' after written notice from Lender to Borrower, and if not so paid
shall thereafter bear interest at the Default Rate specified herein.
Section 6.2 Changes in Financial Condition; Litigation. He will promptly
inform Lender in writing of (i) all material adverse changes in Borrower's
financial condition, and (ii) all existing and all threatened litigation,
claims, investigations, administrative proceedings or similar actions affecting
Borrower which could reasonably be expected to have a Material Adverse Effect.
Section 6.3 Financial Statements and Tax Returns. He will provide Lender
each year, no later than 30 days after the end of the fiscal year of Borrower
and ▇▇▇▇ ▇▇▇▇▇▇ and ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ with copies of a current financial statement
as of the end of such fiscal year, and provide Lender with copies of the federal
income tax returns for each such party no later than 10 days after filing of
such return.
Section 6.4 Compliance With Law. He will conduct his business affairs in
a reasonable and prudent manner and in compliance with all applicable laws,
ordinances, rules, regulations and court and administrative orders, except to
the extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect.
Section 6.5 Use of Proceeds. He will use the proceeds of the Advances
only for the repayment of existing indebtedness of Borrower secured by the Real
Property Collateral, and for general working capital purposes, and not use any
portion thereof, directly or indirectly: (a) to purchase or carry any margin
stock (within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System); (b) to extend credit to others for any purpose; or (c)
for any purpose that violates, or is inconsistent with, the provisions of
Regulations U, T or X of the Board of Governors of the Federal Reserve System.
Section 6.6 Additional Assurances. Make, execute and deliver to Lender
such promissory notes, mortgages, deeds of trust, security agreements, financing
statements, instruments, documents and other agreements as Lender or its
attorneys may reasonably request to evidence and secure the Borrowings and to
perfect all Lender's Liens on and security interests in the Collateral or
otherwise to carry out the purpose and intent of this Agreement.
14
ARTICLE VII
DEFAULT AND REMEDIES
Section 7.1 Events of Default. Each of the following events shall
constitute an event of default ("Event of Default") under this Agreement.
(a) Default on Indebtedness to Lender. Failure of Borrower (i) to
pay when due any principal of or interest on the Advances, or (ii) to pay when
due any other amount due under this Agreement or under any of the other Loan
Documents and, in the case of a failure described in the foregoing clause (ii),
the continuance thereof for a period of three (3) Business Days.
(b) Covenant Default. Failure by Borrower to perform, keep, or
observe any other material term, provision, condition, covenant, or agreement
contained in this Agreement, in any of the other Loan Documents, or in any other
present or future agreement between Borrower and Lender and as to any Default
under such other term, provision, condition, covenant or agreement that can be
cured and does not pose an imminent risk of loss to Lender, has failed to cure
such Default within ten (10) days after Borrower receives written notice thereof
from Lender or any officer, member, manager or partner of Borrower becomes aware
thereof; provided, however, that if the Default cannot by its nature be cured
within the ten (10) day period or cannot after diligent attempts by Borrower be
cured within such ten (10) day period, and such Default is likely to be cured
within a reasonable time, then Borrower shall have an additional reasonable
period (which shall not in any case exceed an additional thirty (30) days) to
attempt to cure such Default, and within such reasonable time period the failure
to have cured such Default shall not be deemed an Event of Default (provided
that no Advances will be required to be made during such cure period).
(c) Material Adverse Change. If there occurs a material adverse
change in the financial condition of Borrower, or if there is a material
impairment of the prospect of repayment of any portion of the Indebtedness owing
by Borrower under this Agreement and the other Loan Documents, or a material
impairment of the value or priority of Lender's security interests in the
Collateral.
(d) Insolvency. If (i) Borrower becomes insolvent, (ii) an
Insolvency Proceeding is commenced by Borrower, or (iii) an Insolvency
Proceeding is commenced against Borrower and is not dismissed or stayed within
sixty (60) days (provided that no Advances will be made prior to the dismissal
of such Insolvency Proceeding).
(e) Misrepresentations. If any material misrepresentation or
material misstatement exists now or hereafter in any representation or warranty
set forth herein, or in any of the other Loan Documents.
15
Section 7.2 Remedies. At any time after the occurrence and during the
continuance of an Event of Default, Lender may, by notice to Borrower, (a)
declare the obligation of Lender to make Advances to be terminated, whereupon
the same shall forthwith terminate, and (b) declare (i) the Note and all
interest thereon and (ii) all other amounts payable under this Agreement and the
other Loan Documents to be immediately due and payable, whereupon the Note, all
such interest, and all such other amounts shall become and be immediately due
and payable, without presentment, demand, protest or further notice of any kind,
all of which are hereby expressly waived by Borrower; provided, however, that if
an Insolvency Proceeding by or against Borrower shall be commenced, (A) the
obligation of Lender to make Advances shall automatically be terminated and (B)
the Note, all interest thereon, and all other amounts payable under this
Agreement and the other Loan Documents shall automatically become and be
immediately due and payable, without presentment, demand, protest or any notice
of any kind, all of which are hereby expressly waived by Borrower.
Section 7.3 Cumulative Remedies. After the occurrence and during the
continuance of an Event of Default, Lender may proceed to enforce the Loan
Documents by exercising such remedies as are available thereunder or in respect
thereof under applicable law, whether for specific performance of any covenant
or other agreement contained in the Loan Documents or in aid of the exercise of
any power granted in the Loan Documents. No remedy conferred in this Agreement
or the other Loan Documents is intended to be exclusive of any other remedy, and
each and every such remedy shall be cumulative and shall be in addition to every
other remedy conferred herein or therein or now or hereafter existing at law, in
equity, by statute or otherwise.
Section 7.4 Application of Payments. After the occurrence and during the
continuance of an Event of Default, Lender shall apply all funds received in
respect of amounts owing under this Agreement and the other Loan Documents in
such order as Lender may determine in its sole discretion notwithstanding any
instruction from Borrower.
Section 7.5 Good Faith Negotiation. If Borrower cannot repay principal
and accrued interest in full upon the maturity of the Note, Borrower and Lender
shall in good faith attempt to negotiate an extension of the term of the Note
upon commercially reasonable terms and conditions. If no agreement is reached
within two weeks of the maturity date of the Note, then the parties obligation
to continue to negotiate an extension shall terminate. Nothing in this section
shall require either Lender or Borrower to agree upon any such extension.
ARTICLE VIII
MISCELLANEOUS
Section 8.1 Amendments. An amendment or waiver of any provision of this
Agreement or the other Loan Documents, or a consent to any departure by Borrower
therefrom, shall be effective against Lender if, but only if, it shall be in
writing and signed by Lender, and then such a waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.
16
Section 8.2 Notices. Except as otherwise specifically provided in this
Agreement, all notices and other communications provided for hereunder shall be
in writing and mailed, telecopied or otherwise transmitted or delivered, if to
Borrower, at:
▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
if to Lender, to its address as set forth under its name on the signature page
of this Agreement; or, as to any party, at such other address as shall be
designated by such party in a written notice to the other party or parties. All
such notices and communications shall, (a) if mailed, be effective three (3)
Business Days following deposit in the United States mail, postage prepaid; (b)
if delivered by recognized overnight delivery service (such as Federal Express)
be effective upon delivery and (c) if telecopied, be effective when telecopied
and electronic confirmation of transmission is received, except that notices and
communications to Lender pursuant to Article II shall not be effective until
received by Lender.
Section 8.3 No Waiver; Remedies. No failure on the part of Lender to
exercise, and no delay in exercising, any right hereunder or under any other
Loan Document shall operate as a waiver thereof; nor shall any single or partial
exercise of any right hereunder or under any other Loan Document preclude any
other or further exercise thereof or the exercise of any other right. The
remedies provided herein and in the other Loan Documents are cumulative and not
exclusive of any remedies provided by law.
Section 8.4 Costs and Expenses; Indemnification.
(a) Costs of Preparation and Administration of Loan Documents.
Whether or not the transactions provided for in this Agreement are consummated,
Borrower shall pay on demand: (i) the reasonable fees and out-of-pocket expenses
of counsel for Lender in connection with the preparation, execution, delivery
and performance of this Agreement and the other Loan Documents and any
amendments or modifications thereof or waivers or consents with respect thereto;
(ii) any and all recording fees, escrow fees, UCC-1 filing fees, title insurance
premiums, and all other out-of-pocket costs and expenses payable in connection
with the execution and delivery of this Agreement and the other Loan Documents
and the administration thereof, and shall save Lender harmless from and against
any and all liabilities resulting from Borrower's failure to pay any amounts
Borrower is required to pay pursuant to this Section 8.4.
(b) Costs of Enforcement. In the event of any Default or Event of
Default under this Agreement, or in the event that any dispute arises (whether
or not such dispute is with Borrower) relating to the interpretation,
enforcement or performance of this Agreement or any of the other Loan Documents,
Lender shall be entitled to collect from Borrower on demand all reasonable fees
and expenses incurred in connection therewith, including but not limited to fees
of attorneys, accountants, appraisers, environmental inspectors, consultants,
expert witnesses, arbitrators, mediators and court reporters. Without limiting
the generality of the foregoing, Borrower shall pay all such costs and expenses
incurred in connection with: (i) arbitration or other alternative dispute
resolution proceedings, trial court actions and appeals;
17
(ii) bankruptcy or other insolvency proceedings of Borrower or any other party
liable for any of the obligations under this Agreement or any of the other Loan
Documents, or any party having any interest in any security for any of those
obligations; (iii) judicial or nonjudicial foreclosure on, or appointment of a
receiver for, any property securing the obligations of Borrower; (iv)
post-judgment collection proceedings; (v) all claims, counterclaims,
cross-claims and defenses asserted in any of the foregoing whether or not they
arise out of or are related to this Agreement or any other Loan Document; (vi)
all preparation for any of the foregoing; and (vii) all settlement negotiations
with respect to any of the foregoing.
(c) Indemnification. Borrower agrees to indemnify and hold each
of Lender, and its officers, directors, employees and agents (collectively,
"Indemnified Parties" and, individually, an "Indemnified Party") free and
harmless from and against any and all actions, causes of action, suits, losses,
costs, liabilities, damages and expenses (regardless of whether such Indemnified
Party is a party to the action for which indemnification hereunder is sought),
including without limitation reasonable attorneys' fees and disbursements (the
"Indemnified Liabilities") incurred by any of the Indemnified Parties as a
result of, or arising out of, or relating to (i) the execution, delivery,
enforcement, performance and administration of this Agreement and the other Loan
Documents or (ii) the use of the proceeds of any Advance, except for any such
Indemnified Liabilities arising on account of the relevant Indemnified Party's
gross negligence or intentional misconduct.
(d) Survival. The provisions of this Section 8.4 shall survive
the termination of the commitment to lend under this Agreement and the repayment
of the Loan and all other amounts payable under the Loan Documents.
Section 8.5 Binding Effect; Assignments and Participations. This
Agreement shall become effective when it shall have been executed by Borrower
and Lender and thereafter shall be binding upon and inure to the benefit of
Borrower and Lender and their respective successors and assigns, except that
Borrower shall not have the right to assign its rights hereunder or any interest
herein without the prior written consent of Lender, which Lender may grant or
withhold in its sole and absolute discretion. Lender may assign or grant
participations to one or more banks or other entities in or to all or any part
of its rights and obligations under this Agreement and the other Loan Documents.
Section 8.6 Execution in Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto on separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Section 8.7 Governing Law. All of the Loan Documents shall be governed
by and construed in accordance with the laws of the state of Washington as
applicable to contracts entered into in the state of Washington between
residents of such state and which are to be wholly performed in such state.
Section 8.8 Jurisdiction and Venue; Waive of Jury Trial
18
(a) Jurisdiction and Venue. Any legal action or proceeding
seeking to enforce this Agreement or any other Loan Document or to recover
damages for the breach thereof, or based upon or arising out of any transaction
provided for in this Agreement or the other Loan Documents, whether sounding in
contract, tort or otherwise, shall, at the sole option of Lender, be brought in
or transferred to the Superior Court of Washington for King County or the United
States District Court for the Western District of Washington at Seattle. Each of
Borrower and Lender consents (for itself and for its successors, assigns,
participants and property) to the non-exclusive jurisdiction of such courts and
of the related appellate courts with respect to all such actions and proceedings
and waives any objection it may now or hereafter have to the laying of venue
therein including but not limited to any objection based on the ground that
either such court is an inconvenient forum. Notwithstanding the foregoing,
Lender may bring any such action or proceeding in any other court having
jurisdiction.
(b) WAIVER OF JURY TRIAL. EACH OF BORROWER AND LENDER (FOR ITSELF
AND ITS SUCCESSORS, ASSIGNS AND PARTICIPANTS) WAIVES ITS RIGHT TO A TRIAL BY
JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON, ARISING OUT OF OR RELATED TO
THIS AGREEMENT, THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS PROVIDED FOR HEREIN
OR THEREIN, IN ANY LEGAL ACTION OR PROCEEDING OF ANY TYPE BROUGHT BY ANY PARTY
TO ANY OF THE FOREGOING AGAINST ANY OTHER SUCH PARTY, WHETHER SOUNDING IN
CONTRACT, TORT OR OTHERWISE. ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY
A COURT SITTING WITHOUT A JURY.
(c) Application to Certain Actions. Without limiting the
foregoing, the provisions of the above Subsections (a) and (b) shall apply to
any action, counterclaim or other proceeding which seeks, in whole or in part,
to challenge the validity or enforceability of this Agreement or the other Loan
Documents or any provision hereof or thereof. Such subsections shall apply to
all amendments, renewals, supplements and modifications of this Agreement and
the other Loan Documents.
Section 8.9 No Fiduciary Duty. Borrower acknowledges that Lender has no
fiduciary relationship with, or fiduciary duty to, Borrower arising out of or in
connection with this Agreement or any of the other Loan Documents, and the
relationship between Lender, on the one hand, and Borrower, on the other, in
connection herewith or therewith is solely that of creditor and debtor. None of
this Agreement or the other Loan Documents create a joint venture among the
parties.
Section 8.10 Severability. Any provision of the Loan Documents that is
prohibited or unenforceable in any jurisdiction shall be ineffective to the
extent of such prohibition or unenforceability in such jurisdiction without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction. To the extent
permitted by applicable law, the parties waive any provision of law which
renders any provision of any other Loan Documents prohibited or unenforceable in
any respect.
19
Section 8.11 Entire Agreement. This Agreement and the other Loan
Documents constitute the final and complete expression of the parties with
respect to the transactions contemplated by this Agreement and replace and
supersede all prior discussions, negotiations and understandings with respect
thereto. Neither this Agreement nor any term hereof nor of the other Loan
Documents may be changed, waived, discharged or terminated except as provided
herein.
Section 8.12 Descriptive Headings. The descriptive headings of the
various provisions of this Agreement are for convenience of reference only, do
not constitute a part hereof, and shall not affect the meaning or construction
of any provision hereof.
Section 8.13 Gender and Number. Whenever appropriate to the meaning of
this Agreement or the other Loan Documents, use of the singular shall be deemed
to refer to the plural, the use of the plural to the singular, and pronouns of
certain gender to either or both the other genders.
[END OF TEXT]
20
ORAL AGREEMENTS OR ORAL COMMITMENTS TO LEND MONEY, EXTEND CREDIT OR TO
FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER
WASHINGTON LAW.
BORROWER:
________________________________________
▇▇▇▇▇▇ ▇▇▇▇▇▇
LENDER: LOUDEYE TECHNOLOGIES, INC.,
a Delaware corporation
By _____________________________________
Its _________________________________
Address for Notices:
▇▇▇ ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy: ______________________________
ADDITIONAL PARTIES:
________________________________________
▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ PROPERTIES, LLC, a
Washington limited liability company
By: ____________________________________
Its: _______________________________
(Signature Page for Credit Agreement)
21
EXHIBIT A
PROMISSORY NOTE
$2,000,000.00 Seattle, Washington
_______________, 2001
For value received, ▇▇▇▇▇▇ ▇▇▇▇▇▇ ("Borrower") promises to pay to the
order of LOUDEYE TECHNOLOGIES, INC., a Delaware corporation ("Lender") the
unpaid principal amount of all Borrowings made by Lender to Borrower pursuant to
the Credit Agreement (as such term is defined below), in the amount of TWO
MILLION DOLLARS ($2,000,000), or so much thereof as may have been advanced by
Lender to or for the benefit of Borrower, on the dates and otherwise as provided
in the Credit Agreement. Borrower promises to pay interest on the unpaid
principal amount of all Borrowings on the dates and at the rate or rates
provided for in the Credit Agreement. Interest on any overdue principal of and,
to the extent permitted by law, overdue interest on the principal amount hereof,
shall bear interest at the Default Rate, as provided for in the Credit
Agreement. All such payments of principal of and interest on any Borrowing shall
be made as provided in the Credit Agreement.
All Advances and the interest rates from time to time applicable
thereto, and all payments of the principal thereof shall be recorded by Lender
in accordance with its usual practices; provided, that the failure of Lender to
make any such recordation shall not affect the obligations of Borrower hereunder
or under the Credit Agreement.
Borrower hereby waives diligence, presentment, demand, protest and,
except for notices required to be given pursuant to the Credit Agreement, notice
of any kind whatsoever. The nonexercise by the holder of any of its rights
hereunder in any particular instance shall not constitute a waiver thereof in
that or any subsequent instance.
This Note is the Note referred to in the Credit Agreement dated as of
October 26, 2001 between Borrower and Lender (as the same may be amended,
modified, extended, renewed or supplemented from time to time, the "Credit
Agreement"). Capitalized terms used in this Note without definition have the
meanings assigned to them in the Credit Agreement. Reference is made to the
Credit Agreement for provisions for the optional prepayment and the repayment
hereof and the acceleration of the maturity hereof. This Note is governed by the
laws of the State of Washington.
The indebtedness of Borrower evidenced by this Note includes the
indebtedness of Borrower resulting from Advances made by Lender to Borrower from
time to time pursuant to the Credit Agreement.
A-1
ORAL AGREEMENTS OR ORAL COMMITMENTS TO LEND MONEY, EXTEND CREDIT, OR TO FORBEAR
FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON LAW.
_______________________________________
▇▇▇▇▇▇ ▇▇▇▇▇▇
A-2
EXHIBIT B
REQUEST FOR ADVANCE
Loudeye Technologies, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Date: ________________, _____
Attention: ______________________
This refers to the Amended and Restate Credit Agreement dated as of
November 30, 2001 (the "Credit Agreement") (capitalized terms used herein and
not otherwise defined have the meanings given to them in the Credit Agreement),
between the undersigned ("Borrower") and Loudeye Technologies, Inc. ("Lender"),
and hereby gives Lender notice, irrevocably, pursuant to Article II of the
Credit Agreement that Borrower hereby requests an Advance under the Credit
Agreement in the principal amount of $______________.
CERTIFICATIONS
The undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the date of the Proposed Borrowing,
before and immediately after giving effect thereto and to the application of the
proceeds therefrom:
(A) The representations and warranties contained in Article IV of the
Credit Agreement are true and correct as though made on and as of such dates,
unless such representations and warranties are expressly stated to be made as of
an earlier date;
(B) The most recent financial statements of Borrower and ▇▇ ▇▇▇▇ ▇▇▇▇▇▇
delivered pursuant to Section 6.3 of the Credit Agreement present fairly the
financial position of Borrower and ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, as applicable, as of the date
of, and for the periods presented in, such financial statements, and since the
date of such financial statements there has not been any Material Adverse Change
in the financial condition of Borrower or of any of the Collateral (as defined
in the Credit Agreement);
(C) Borrower is in full compliance with all covenants contained in
Articles V and VI of the Credit Agreement.
(D) No event has occurred and is continuing, or would result from such
Proposed Borrowing, which constitutes or would constitute an Event of Default or
a Default under the Credit Agreement.
Very truly yours,
▇▇▇▇▇▇ ▇▇▇▇▇▇
B-1