EXHIBIT 10.22
CREDIT FACILITY AGREEMENT
AND
PROMISSORY NOTE
This CREDIT FACILITY AGREEMENT (the "Agreement") is made as of February 3,
2000 between Netrix Corporation (the "Borrower") and ▇▇▇▇▇▇ ▇. Francesco (the
"Lender").
SECTION 1. AMOUNT AND TERMS OF THE CREDIT FACILITY
1.1 THE CREDIT FACILITY
Subject to the terms and conditions of this Agreement and the Note (as such
term is defined in Section 1.2 below), the Lender agrees to make available to
the Borrower a credit facility (the "Facility") under which the Borrower may
from time to time on or after the date hereof to and including the Expiration
Date (as such term is defined in Section 2.3 below) borrow from the Lender any
amount up to but not to exceed $10,000,000 in the aggregate at any one time
outstanding (exclusive of interest, fees or other charges payable by the
Borrower under this Agreement and Note). Borrowings under the Facility are
herein referred to collectively as the "Loans" and individually as a "Loan". The
Borrower may use the Facility by borrowing, repaying and reborrowing in
accordance with the terms and conditions of this Agreement and the Note. Each
request for a Loan may be made upon ten business days' notice. Each Loan shall
be deemed to be a representation and warranty by the Borrower on the date of
such Loan that immediately prior to and after the making of such Loan (i) no
Event of Default (as described in Section 2.1 below), or event which, with the
giving of notice or lapse of time or both, would become such an Event of
Default, shall have occurred and be continuing and (ii) no material adverse
change in the financial condition, assets, business, operations or prospects of
the Borrower shall have occurred, and the truth and correctness of each of the
foregoing representations when deemed made is a condition precedent to the
Lender's obligation to make such Loan.
1.2 THE NOTE
On or prior to the date on which the Lender makes the initial Loan to the
Borrower under the Facility, the Borrower shall execute and deliver to the
Lender the promissory note (the "Note") which follows this Agreement.
The initial Loan and all subsequent Loans, and each payment made on account
of the principal thereof, shall be endorsed on the Note as of the date such Loan
is made or such payment is received by the Lender in immediately available funds
as provided in the Note. The Note shall be used to record all Loans and payments
of principal made under the Facility.
1.3 VOLUNTARY PREPAYMENTS
The Borrower may prepay the Note in whole at any time or in part from time
to time without premium or penalty. Partial prepayments of the Note shall be in
a minimum principal amount of $10,000 or any whole multiple thereof.
1.4 FINANCIAL INFORMATION
The Borrower hereby agrees to provide such financial information to the
Lender as the Lender may reasonably request from time to time.
SECTION 2. TERMINATION OF THE FACILITY
2.1 EVENTS OF DEFAULT
If the Borrower fails to perform any agreement herein contained or
contained in any other agreement with the Lender or if default occurs in the
punctual payment of any sum payable under the Note, this Agreement or any other
obligation of the Borrower to the Lender, or if any representation or warranty
deemed made pursuant to Section 1.1 above shall be untrue or incorrect in any
respect, or if any event described in paragraph 3 of the Note occurs; then the
Facility shall automatically terminate and all Loans, although not yet due,
shall become immediately due and payable without notice or demand.
2.2 TERMINATION OR REDUCTION OF COMMITMENT
The Borrower shall have the right, upon prior written notice to the Lender,
to terminate the Facility in whole at any time or to reduce the amount of the
Facility provided in Section 1.1 in part from time to time, provided that (a)
any termination of the Facility shall be accompanied by payment in full of the
unpaid principal amount of the Note, together with interest accrued thereon, and
(b) partial reductions of the Facility shall be in the minimum amount of
$25,000, and shall be accompanied by prepayment, together with interest accrued
thereon to the date of the prepayment, to the extent, if any, that the aggregate
unpaid principal amount of the Note exceeds the Facility as then reduced.
2.3 EXPIRATION DATE
Unless specifically extended by the Lender in writing or otherwise
terminated under Section 2.1 or Section 2.2, the Facility shall expire on the
earlier of (x) May 30, 2001 or (y) the date Borrower raises $10.0 million or
more through the sale of equity securities (the "Expiration Date"), and all
amounts outstanding under this Agreement and the Note shall be due and payable
on the Expiration Date.
SECTION 3. MISCELLANEOUS
3.1 NO WAIVER
The Borrower agrees that no failure to exercise and no delay in exercising,
on the part of the Lender, any right, power or privilege under this Agreement or
the Note shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, power or privilege under this Agreement or the Note
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies provided under this Agreement
and the Note are cumulative and not exclusive of any rights or remedies provided
by law. No modification or waiver of any provision of this Agreement or the
Note, or any consent to any departure by the Borrower from the provisions hereof
or thereof, shall be effective unless the same shall be in writing from the
Lender and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which it is given. No notice to the Borrower
shall entitle the Borrower to any other or further notice in other or similar
circumstances unless expressly provided for herein. No course of dealing between
the Borrower and the Lender shall operate as a waiver of any of the rights of
the Lender under this Agreement or the Note.
2
3.2 SUCCESSORS AND ASSIGNS
The Lender may at any time and from time to time sell, assign, transfer or
otherwise dispose of all or any portion of this Agreement, the Note or the
Lender's interest herein and the Lender may furnish any information concerning
the Borrower in the possession of the Lender from time to time to its
transferees or assignees (including prospective transferees or assignees). The
Borrower may not assign or transfer its rights or obligations hereunder without
the prior written consent of the Lender.
3.3 EXPENSES
The Borrower agrees to reimburse the Lender on demand for all costs,
expenses and charges (including, without limitation, fees and charges of counsel
and costs allocated by internal legal counsel) in connection with the
preparation or modification of this Agreement and the Note; the performance,
collection or enforcement of this Agreement or the Note; or, the defense or
prosecution of any rights of the Lender pursuant to this Agreement or the Note.
3.4 GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
laws of the Commonwealth of Virginia.
3.5 NOTICE
All notices, requests, demands, claims and other communications hereunder
shall be in writing. Any notice, request, demand, claim or other communication
hereunder shall be deemed dully given if (and then two business days after) it
is sent by registered or certified mail, return receipt requested, postage
prepaid and addressed to the intended recipient as set forth below:
If to the Borrower Netrix Corporation
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chairman
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Lender ▇▇▇▇▇▇ ▇. Francesco
c/o Netrix Corporation
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Either the Borrower or the Lender may send any notice, request, demand,
claim or other communication hereunder to the intended recipient at the address
set forth above using personal delivery, expedited courier, messenger service,
telecopy or ordinary mail, but no such notice, request, demand, claim or other
communication shall be deemed to have been duly given unless and until it
actually is received by the intended recipient. Either the Borrower or the
Lender may change the address to which notices, requests, demands, claims and
other communications hereunder are to be delivered by given the other notice in
the manner set forth in this paragraph, provided that no such change of address
shall be effective until it actually is received by the intended recipient.
3
3.6 ENTIRE AGREEMENT
This Agreement (including the Note) constitutes the entire agreement
between the Borrower and the Lender and supersedes any prior understandings,
agreements or representations by or between the Borrower and the Lender, written
or oral, to the extent they related in any way to the subject matter hereof.
The Borrower and the Lender have caused this Agreement to be signed as of
the date first written above.
NETRIX CORPORATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------
Title: Chief Financial Officer
--------------------------------
/s/ ▇▇▇▇▇▇ ▇. Francesco
--------------------------------
▇▇▇▇▇▇ ▇. Francesco
▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇
$ ---------------- ----------------------,-------------,
1. On the Expiration Date (as such term is defined in Section 2.3 of the
Credit Facility Agreement of even date herewith between the Borrower and the
Lender (the "Agreement")), FOR VALUE RECEIVED, Netrix Corporation (the
"Borrower") promises to pay to the order of ▇▇▇▇▇▇ ▇. Francesco (the "Lender")
at his address provided in the Agreement, in United States dollars, the
aggregate unpaid principal amount of all Loans (as such term is defined in
Section 1.1 of the Agreement) made by the Lender to the Borrower as shown on the
schedule attached hereto and made a part hereof (the "Schedule"), together with
interest (calculated on the basis of a 360 day year for the actual number of
days elapsed) on the unpaid principal amount thereof from time to time
outstanding at a rate per annum equal to 5% above the prime rate of interest
published by THE WALL STREET JOURNAL from time to time as the prime rate, but in
no event in excess of the maximum rate permitted by applicable law. Any
principal amount hereof which is not paid when due (whether as stated, by
acceleration or otherwise) shall bear interest for each day during the period
from and including the due date to the date of payment in full thereof at a rate
per annum equal to 2% above the rate in effect on such day. The Borrower agrees
that interest shall be payable on the last business day of each calendar month
commencing on the first such date occurring after the date of this Note and on
any payment of principal. Any change in the interest rate resulting from a
change in the prime rate shall become effective as of the opening of business on
the day on which such change in such prime rate occurs. If any payment under
this Note becomes due and payable on a Saturday, Sunday or other day on which
commercial Lenders are authorized to close under the laws of the Commonwealth of
Virginia, the maturity thereof shall be extended to the next succeeding business
day and interest thereon shall be payable at the applicable rate during such
extension.
2. The Lender shall, and is hereby authorized by the Borrower to, endorse
on the Schedule and any continuations thereof appropriate notations to evidence
the date and principal amount of each Loan and the date and amount of each
payment of principal on the date such Loan is made or a payment in immediately
available funds is received; provided that the Lender's failure to make any such
notation shall not limit or otherwise affect the obligations of the Borrower
hereunder or under the Agreement. This Note shall be used to record all Loans
and payment of principal made hereunder and it shall continue to be used even
though there may be periods when no amount of principal or interest is owing
hereunder. The Schedule and all continuations thereof shall be conclusive in the
absence of manifest error.
3. If any of the following events of default shall occur with respect to
the Borrower: (a) the Borrower shall fail to pay the principal of, or interest
on, this Note, or any other amount payable under this Note or the Agreement, as
and when due and payable; (b) any representation or warranty made or deemed made
by the Borrower in this Note or in the Agreement, or which is contained in any
certificate, document, opinion, financial or other statement furnished at any
time under or in connection with any this Note or the Agreement, shall prove to
have been incorrect in any material respect on or as of the date made or deemed
made; (c) the Borrower shall fail to perform or observe any term, covenant or
agreement contained in any Note or the Agreement on its part to be performed or
observed; (d) the Borrower or shall fail to pay when due any indebtedness
(including but not limited to indebtedness for borrowed money) or if any such
indebtedness shall become due and payable, or shall be capable of becoming due
and payable at the option of any holder thereof, by acceleration of its maturity
or if there shall be any default by the Borrower under any agreement relating to
such indebtedness; (e) the Borrower shall dissolve or for any reason cease to be
in existence; or (f) the Borrower is involved in a proceeding which may result
in a forfeiture of all or a substantial part of the Borrower's assets or a
material judgment is entered against the Borrower; THEN, in any such case, if
the Lender shall elect by notice to the Borrower, the unpaid principal amount of
this Note and all Loans made hereunder, together with accrued interest, shall
become forthwith due and payable; the unpaid principal amount of this Note and
all Loans made hereunder, together with accrued interest, shall immediately
become due and payable without any notice or other action by the Lender.
4. This Note is the Note referred to in the Agreement and is subject to the
terms and conditions thereof, is entitled to the benefits thereof and may be
prepaid as provided therein.
5
5. This Note shall be governed by and construed in accordance with the laws
of the Commonwealth of Virginia.
NETRIX CORPORATION
BY:_________________________________________
TITLE:______________________________________
6
SCHEDULE OF LOANS AND PAYMENT
===============================================================================
AGGREGATE
PRINCIPAL
DATE BALANCE NOTATION
OF AMOUNT OF REMAINING MADE
LOAN AMOUNT OF LOAN PAYMENT UNPAID BY
===============================================================================
7
