Initial Public Offering (IPO): Registration Statement (General Form) — Form S-1
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-1 Original Filing of Form S-1 114 590K
2: EX-3.1 Amended and Restated Certificate of Incorporation 21 85K
3: EX-3.2 Form of Amended and Restated Certificate of Incorp 5 19K
4: EX-3.3 Amended and Restated By-Laws 15 60K
5: EX-3.4 Form of Amended and Restated By-Laws 15 58K
6: EX-4.2 Common Stock Purchase Agreement 22 109K
7: EX-10.1 Form of Indemnification Agreement 12 57K
8: EX-10.2 1997 Stock Option/Issuance Plan 16 55K
9: EX-10.3 2000 Equity Incentive Plan 21 103K
10: EX-10.4 2000 Employee Stock Purchase Plan 12 51K
11: EX-10.5 Security and Loan Agreement 15 78K
12: EX-10.6 Lease Agreement With Huskers-Research 37 170K
13: EX-10.7 Lease Agreement With Waterford Iv Hp 25 139K
14: EX-16.1 Letter Regarding Change in Independent Auditors 1 7K
15: EX-21.1 Subsidiaries 1 6K
16: EX-23.1 Consent of Ernst & Young LLP 1 7K
17: EX-23.3 Consent of Pricewaterhousecoopers LLP 1 7K
18: EX-27.1 Financial Data Schedule 2 9K
[LOGO] EXHIBIT 10.5
PROMISSORY NOTE
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Principal Loan Date Maturity Loan No. Call Collateral Account Officer Initials
$1,250,000.00 05-19-1999 11-19-2002 721000060 622601 261
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References in the shaded area are for Lender's use only and do not limit the applicability of this document to any
particular loan or item.
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Borrower: MOTIVE COMMUNICATIONS, INC., A DELAWARE Lender: Imperial Bank
CORPORATION Emerging Growth Industries Group-
9211 WATERFORD CENTRE BLVD., STE. 100 Southwest Regional Office
AUSTIN, TX 78758 226 Airport Parkway
San Jose, CA 95110-1024
=====================================================================================================================
Principal Amount: $1,250,000.00 Initial Rate: 7.750% Date of Note: May 19, 1999
PROMISE TO PAY. MOTIVE COMMUNICATIONS, INC., A DELAWARE CORPORATION ("Borrower")
promises to pay to Imperial Bank ("Lender"), or order, in lawful money of the
United States of America, the principal amount of One Million Two Hundred Fifty
Thousand & 00/100 Dollars ($1,250,000.00) or so much as may be outstanding,
together with interest on the unpaid outstanding principal balance of each
advance. Interest shall be calculated from the date of each advance until
repayment of each advance.
PAYMENT. Borrower will pay this loan in accordance with the following payment
schedule:
Advances under the Note shall be available through May 19, 2000 ("Draw
Period"). During the draw period, interest only shall be due monthly
beginning June 19, 1999. On May 19, 2000, the outstanding principal
balance of the advances under the Note shall be payable in 30 equal
monthly payments of principal based on an amortization period of 30
months. Accrued interest shall be payable monthly beginning June 19,
2000. All principal and accrued but unpaid interest shall in any event
be due and payable on or before November 19, 2002. A maximum of
$100,000 will be available for software purchases.
The annual interest rate for this Note is computed on a 365/360 basis; that is,
by applying the ratio of the annual interest rate over a year of 360 days,
multiplied by the outstanding principal balance, multiplied by the actual number
of days the principal balance is outstanding. Borrower will pay Lender at
Lender's address shown above or at such other place as Lender may designate in
writing. Unless otherwise agreed or required by applicable law, payments will be
applied first to any unpaid collection costs and any late charges, then to any
unpaid interest, and any remaining amount to principal.
VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from
time to time based on changes in an index which is the Imperial Bank Prime Rate
(the "Index"). The Prime Rate is the rate announced by Lender as its Prime Rate
of interest from time to time. Lender will tell Borrower the current index rate
upon Borrower's request. Borrower understands that Lender may make loans based
on other rates as well. The interest rate change will not occur more often than
each day. The index currently is 7.760%. The interest rate to be applied to the
unpaid principal balance of this Note will be at a rate equal to the index
resulting in an initial rate of 7.750%. NOTICE: Under no circumstances will the
interest rate on this Note be more than the maximum rate allowed by applicable
law.
PREPAYMENT; MINIMUM INTEREST CHARGE. Borrower agrees that all loan fees and
other prepaid finance charges are earned fully as of the date of the loan and
will not be subject to refund upon early payment (whether voluntary or as a
result of default), except as otherwise required by law. In any event, even upon
full prepayment of this Note, Borrower understands that Lender is entitled to a
minimum interest charge of $250.00. Other than Borrower's obligation to pay any
minimum interest charge, Borrower may pay without penalty all or a portion of
the amount owed earlier than it is due. Early payments will not, unless agreed
to by Lender in writing, relieve Borrower of Borrower's obligation to continue
to make payments of accrued unpaid interest. Rather, they will reduce the
principal balance due.
LATE CHARGE. If a payment is 10 days or more late, Borrower will be charged
5.000% of the unpaid portion of the regularly scheduled payment.
DEFAULT. Borrower will be in default if any of the following happens: (a)
Borrower fails to make any payment when due. (b) Borrower breaks any promise
Borrower has made to Lender, or Borrower fails to comply with or to perform when
due any other term, obligation, covenant, or condition contained in this Note or
any agreement related to this Note, or in any other agreement or loan Borrower
has with Lender. (c) Any representation or statement made or furnished to Lender
by Borrower or on Borrower's behalf is false or misleading in any material
respect either now or at the time made or furnished. (d) Borrower becomes
insolvent, a receiver is appointed for any part of Borrower's property, Borrower
makes an assignment for the benefit of creditors, or any proceeding is commenced
either by Borrower or against Borrower under any bankruptcy or insolvency
laws. (e) Any creditor tries to take any of Borrower's property on or in which
Lender has a lien or security interest. This includes a garnishment of any of
Borrower's accounts with Lender. (f) Any guarantor dies or any of the other
events described in this default section occurs with respect to any guarantor of
this Note. (g) A material adverse change occurs in Borrower's financial
condition, or Lender believes the prospect of payment or performance of the
indebtedness is impaired. (h) Lender in good faith deems itself insecure.
If any default, other than a default in payment, is curable and if Borrower has
not been given a notice of a breach of the same provision of this Note within
the preceding twelve (12) months, it may be cured (and no event of default will
have occurred) if Borrower, after receiving written notice from Lender demanding
cure of such default: (a) cures the default within ten (10) days; or (b) if the
cure requires more than ten (10) days, immediately initiates steps which
Lender deems in Lender's sole discretion to be sufficient to cure the default
and thereafter continues and completes all reasonable and necessary steps
sufficient to produce compliance as soon as reasonably practical.
LENDER'S RIGHTS. Upon default, Lender may declare the entire unpaid principal
balance on this Note and all accrued unpaid interest immediately due, without
notice, and then Borrower will pay that amount. Upon Borrower's failure to pay
all amounts declared due pursuant to this section, including failure to pay upon
final maturity. Lender, at its option, may also, if permitted under applicable
law, do one or both of the following: (a) increase the variable interest rate on
this Note to 5.000 percentage points over the index, and (b) add any unpaid
accrued interest to principal and such sum will bear interest therefrom until
paid at the rate provided in this Note (including any increased rate). Lender
may hire or pay someone else to help collect this Note if Borrower does not pay.
Borrower also will pay Lender that amount. This includes, subject to any limits
under applicable law, Lender's attorneys' fees and Lender's legal expenses
whether or not there is a lawsuit, including attorneys' fees and legal expenses
for bankruptcy proceedings (including efforts to modify or vacate any automatic
stay or injunction), appeals, and any anticipated post-judgment collection
services. Borrower also will pay any court costs, in addition to all other sums
provided by law. This Note has been delivered to Lender and accepted by Lender
in the State of California. If there is a lawsuit, Borrower agrees upon Lender's
request to submit to the jurisdiction of the courts of Los Angeles County, the
State of California. Lender and Borrower hereby waive the right to any jury
trial in any action, proceeding, or counterclaim brought by either Lender or
Borrower against the other. (Initial Here SH) This Note shall be governed by and
--
construed in accordance with the laws of the State of California.
DISHONORED ITEM FEE. Borrower will pay a fee to Lender of $25.00 if Borrower
makes a payment on Borrower's loan and the check or preauthorized charge with
which Borrower pays is later dishonored.
RIGHT OF SETOFF. Borrower grants to Lender a contractual security interest in,
and hereby assigns, conveys, delivers, pledges, and transfers to Lender all
Borrower's right, title and interest in and to, Borrower's accounts with Lender
(whether checking, savings, or some other account), including without limitation
all accounts held jointly with someone else and all accounts Borrower may open
in the future, excluding however all IRA and Keogh accounts, and all trust
accounts for which the grant of a security interest would be prohibited by law.
Borrower authorizes Lender, to the extent permitted by applicable law, to charge
or setoff all sums owing on this Note against any and all such accounts.
LINE OF CREDIT. This Note evidences a straight line of credit. Once the total
amount of principal has been advanced, Borrower is not entitled to further loan
advances. Advances under this Note may be requested orally by Borrower or by an
authorized person. All oral requests shall be confirmed in writing on the day of
the request. All communications, instructions, or directions by telephone or
otherwise to Lender are to be directed to Lender's office shown above. The
following party or parties are authorized to request advances under the line of
credit until Lender receives from Borrower at Lender's address shown above
written notice of revocation of their authority: SCOTT HARMON, PRESIDENT & CEO;
PAT MOTOLA, VP, BUS, DEV. & CFO; and SCOTT ABEL, VP, ON LINE SERVICES. Borrower
agrees to be liable for all sums either: (a) advanced in accordance with the
instructions of an authorized person or (b) credited to any of Borrower's
accounts with Lender. The unpaid principal balance owing on this Note at any
time may be evidenced by endorsements on this Note or by Lender's internal
records, including daily computer print-outs. Lender will have no obligation to
advance funds under this Note if: (a) Borrower or any guarantor is in default
under the terms of this Note or any agreement that Borrower or any guarantor has
with Lender, including any agreement made in connection with the signing of this
Note; (b) Borrower or any guarantor ceases doing business or is insolvent; (c)
any guarantor seeks, claims or otherwise attempts to limit, modify or revoke
such guarantor's guarantee of this Note
05-19-1999 Page 2
PROMISSORY NOTE
(Continued)
================================================================================
or any other loan with Lender; (d) Borrower has applied funds provided pursuant
to this Note for purposes other than those authorized by Lender; or (e) Lender
in good faith deems itself insecure under this Note or any other agreement
between Lender and Borrower.
CREDIT TERMS AND CONDITIONS AGREEMENT. This Note is subject to the provisions of
the Credit Terms and Conditions Agreement dated June 5, 1998 and all amendments
thereto and replacements therefor.
GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights or
remedies under this Note without losing them. Borrower and any other person who
signs, guarantees or endorses this Note, to the extent allowed by law, waive any
applicable statute of limitations, presentment, demand for payment, protest and
notice of dishonor. Upon any change in the terms of this Note, and unless
otherwise expressly stated in writing, no party who signs this Note, whether as
maker, guarantor, accommodation maker or endorser, shall be released from
liability. All such parties agree that Lender may renew or extend (repeatedly
and for any length of time) this loan, or release any party or guarantor or
collateral; or impair, fail to realize upon or perfect Lender's security
interest in the collateral; and take any other action deemed necessary by Lender
without the consent of or notice to anyone. Ail such parties also agree that
Lender may modify this loan without the consent of or notice to anyone other
than the party with whom the modification is made.
PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF
THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO
THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THE NOTE.
BORROWER:
MOTIVE COMMUNICATIONS, INC., A DELAWARE CORPORATION
By: /s/ Scott Harmon
----------------------------------
SCOTT HARMON, PRESIDENT & CEO
================================================================================
SIGNATURE AUTHORIZATION
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Borrower: MOTIVE COMMUNICATIONS, INC., A DELAWARE Lender: Imperial Bank
CORPORATION Emerging Growth Industries Group-
9211 WATERFORD CENTRE BLVD., STE. 100 Southwest Regional Office
AUSTIN, TX 78759 226 Airport Parkway
San Jose, CA 95110-1024
=================================================================================================
This SIGNATURE AUTHORIZATION is attached to and by this reference is made a part
of each Borrowing Resolution, dated May 19, 1999, and executed in connection
with a loan or other financial accommodations between Imperial Bank and MOTIVE
COMMUNICATIONS, INC., A DELAWARE CORPORATION.
The individuals named below, any one acting alone, are hereby authorized and
appointed for and on behalf of Borrower from time to time to do any of the
following:
(1) To request advances of credit under the Agreement and to effect repayment of
any credit outstanding under the Agreement;
(2) To execute and deliver assignments, borrowing certificates, instruments,
schedules, reports, invoices, bills, shipping documents and such other documents
or certificates as may be necessary or appropriate under the Agreement or any
other agreement or instrument relating thereto or delivered in connection
therewith;
(3) To transfer and endorse to Bank in payment of Borrower's obligations to Bank
any checks, drafts, notes or other instruments payable to Borrower; and
(4) To do or perform any and all other acts or matters in any way relating to
any or all of the foregoing.
The undersigned individuals each further certifies that the specimen signatures
below are the genuine signatures of the individuals designated herein and that
their signatures shall be binding on Borrower until Bank receives written notice
of termination of the authority of any such designated individuals.
Signature: /s/ Scott L. Harmon
------------------------------
Name: Scott L. Harmon
-----------------------------------
Signature: /s/ Pat Motola
------------------------------
Name: Pat Motola
-----------------------------------
Signature: /s/ Scott Abel
------------------------------
Name: Scott Abel
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
THIS SIGNATURE AUTHORIZATION IS EXECUTED ON MAY 19, 1999.
BORROWER:
MOTIVE COMMUNICATIONS, INC., A DELAWARE CORPORATION
By: /s/ Scott Harmon
-------------------------------------
Scott Harmon, President & CEO
LENDER:
Imperial Bank
By:
-------------------------------------
Authorized Officer
[LOGO]
[Enlarge/Download Table]
PROMISSORY NOTE
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Principal Loan Date Maturity Loan No. Call Collateral Account Officer Initials
$2,500,000.00 05-19-1999 05-17-2000 721000060 622601 261
---------------------------------------------------------------------------------------------------------------------
References in the shaded area are for Lender's use only and do not limit the applicability of this document to any
particular loan or item.
---------------------------------------------------------------------------------------------------------------------
BORROWER: MOTIVE COMMUNICATIONS, INC., A DELAWARE Lender: Imperial Bank
CORPORATION Emerging Growth Industries Group-
9211 WATERFORD CENTRE BLVD., STE. 100 Southwest Regional Office
AUSTIN, TX 78759 226 Airport Parkway
San Jose, CA 95110-1024
=====================================================================================================================
Principal Amount: $2,500,000.00 Initial Rate: 7.750% Date of Note: May 19, 1999
PROMISE TO PAY. MOTIVE COMMUNICATIONS, INC., A DELAWARE CORPORATION ("Borrower")
promises to pay to Imperial Bank ("Lender"), or order, in lawful money of the
United States of America, the principal amount of Two Million Five Hundred
Thousand & 00/100 Dollars ($2,500,000.00) or so much as may be outstanding,
together with interest on the unpaid outstanding principal balance of each
advance. Interest shall be calculated from the date of each advance until
repayment of, each advance.
PAYMENT. Borrower will pay this loan in one payment of all outstanding principal
plus all accrued unpaid interest on May 17, 2000. In addition, Borrower will pay
regular monthly payments of accrued unpaid interest beginning June 19, 1999, and
all subsequent interest payments are due on the same day of each month after
that. The annual interest rate for this Note is computed on a 365/360 basis;
that is, by applying the ratio of the annual interest rate over a year of 360
days, multiplied by the outstanding principal balance, multiplied by the actual
number of days the principal balance is outstanding. Borrower will pay Lender at
Lender's address shown above or at such other place as Lender may designate in
writing. Unless otherwise agreed or required by applicable law, payments will be
applied first to any unpaid collection costs and any late charges, then to any
unpaid interest, and any remaining amount to principal.
VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from
time to time based on changes in an index which is the Imperial Bank Prime Rate
(the "Index"). The Prime Rate is the rate announced by Lender as its Prime Rate
of interest from time to time. Lender will tell Borrower the current Index rate
upon Borrower's request. Borrower understands that Lender may make loans based
on other rates as well. The interest rate change will not occur more often than
each day. The Index currently is 7.750%. The interest rate to be applied to the
unpaid principal balance of this Note will be at a rate equal to the Index,
resulting in an initial rate of 7.750%. NOTICE: Under no circumstances will the
interest rate on this Note be more than the maximum rate allowed by applicable
law.
PREPAYMENT; MINIMUM INTEREST CHARGE. In any event, even upon full prepayment of
this Note, Borrower understands that Lender is entitled to a minimum interest
charge of $250.00. Other than Borrower's obligation to pay any minimum interest
charge, Borrower may pay without penalty all or a portion of the amount owed
earlier than it is due. Early payments will not, unless agreed to by Lender in
writing, relieve Borrower of Borrower's obligation to continue to make payments
of accrued unpaid interest. Rather, they will reduce the principal balance
due.
LATE CHARGE. If a payment is 10 days or more late, Borrower will be charged
5.000% of the unpaid portion of the regularly scheduled payment.
DEFAULT. Borrower will be in default if any of the following happens: (a)
Borrower fails to make any payment when due. (b) Borrower breaks any promise
Borrower has made to Lender, or Borrower fails to comply with or to perform when
due any other term, obligation, covenant, or condition contained in this Note or
any agreement related to this Note, or in any other agreement or loan Borrower
has with Lender. (c) Any representation or statement made or furnished to Lender
by Borrower or on Borrower's behalf is false or misleading in any material
respect either now or at the time made or furnished. (d) Borrower becomes
insolvent, a receiver is appointed for any part of Borrower's property, Borrower
makes an assignment for the benefit of creditors, or any proceeding is commenced
either by Borrower or against Borrower under any bankruptcy or insolvency laws.
(e) Any creditor tries to take any of Borrower's property on or in which Lender
has a lien or security interest. This includes a garnishment of any of
Borrower's accounts with Lender. (f) Any guarantor dies or any of the other
events described in this default section occurs with respect to any guarantor of
this Note. (g) A material adverse change occurs in Borrower's financial
condition, or Lender believes the prospect of payment or performance of the
Indebtedness is impaired. (h) Lender in good faith deems itself insecure.
If any default, other than a default in payment, is curable and If Borrower has
not been given a notice of a breach of the same provision of this Note within
the preceding twelve (12) months, it may be cured (and no event of default will
have occurred) if Borrower, after receiving written notice from Lender demanding
cure of such default: (a) cures the default within ten (10) days; or (b) if the
cure requires more than ten (10) days, immediately initiates steps which Lender
deems in Lender's sole discretion to be sufficient to cure the default and
there-after continues and completes all reasonable and necessary steps
sufficient to produce compliance as soon as reasonably practical.
LENDER'S RIGHTS. Upon default, Lender may declare the entire unpaid principal
balance on this Note and all accrued unpaid interest immediately due, without
notice, and then Borrower will pay that amount. Upon Borrower's failure to pay
all amounts declared due pursuant to this section, including failure to pay upon
final maturity, Lender, at its option, may also, if permitted under applicable
law, do one or both of the following: (a) increase the variable Interest rate on
this Note to 5.000 percentage points over the Index, and (b) add any unpaid
accrued interest to principal and such sum will bear interest therefrom until
paid at the rate provided in this Note (including any increased rate). Lender
may hire or pay someone else to help collect this Note if Borrower does not pay.
Borrower also will pay Lender that amount. This includes, subject to any limits
under applicable law, Lender's attorneys' fees and Lender's legal expenses
whether or not there is a lawsuit, including attorneys' fees and legal expenses
for bankruptcy proceedings (including efforts to modify or vacate any automatic
stay or injunction), appeals, and any anticipated post-judgment collection
services. Borrower also will pay any court costs, in addition to all other sums
provided by law. This Note has been delivered to Lender and accepted by Lender
in the State of California. If there is a lawsuit, Borrower agrees upon Lender's
request to submit to the jurisdiction of the courts of Los Angeles County, the
State of California. Lender and Borrower hereby waive the right to any jury
trial in any action, proceeding, or counterclaim brought by either Lender or
Borrower against the other. (Initial Here SH) This Note shall be governed by
--
and construed in accordance with the laws of the State of California.
DISHONORED ITEM FEE. Borrower will pay a fee to Lender of $25.00 if Borrower
makes a payment on Borrower's loan and the check or preauthorized charge with
which Borrower pays is later dishonored.
RIGHT OF SETOFF. Borrower grants to Lender a contractual security interest in,
and hereby assigns, conveys, delivers, pledges, and transfers to Lender all
Borrower's right, title and interest in and to, Borrower's accounts with Lender
(whether checking, savings, or some other account), including without limitation
all accounts held jointly with someone else and all accounts Borrower may open
in the future, excluding however all IRA and Keogh accounts, and all trust
accounts for which the grant of a security interest would be prohibited by law.
Borrower authorizes Lender, to the extent permitted by applicable law, to charge
or setoff all sums owing on this Note against any and all such accounts.
LINE OF CREDIT. This Note evidences a revolving line of credit. Advances under
this Note may be requested orally by Borrower or by an authorized person. All
oral requests shall be confirmed in writing on the day of the request. All
communications, instructions, or directions by telephone or otherwise to Lender
are to be directed to Lender's office shown above. The following party or
parties are authorized to request advances under the line of credit until Lender
receives from Borrower at Lender's address shown above written notice of
revocation of their authority: SCOTT HARMON, PRESIDENT & CEO; PAT MOTOLA, VP,
BUS. DEV. & CFO; and SCOTT ABEL, VP, ON LINE SERVICES. Borrower agrees to be
liable for all sums either: (a) advanced in accordance with the instructions of
an authorized person or (b) credited to any of Borrower's accounts with Lender.
The unpaid principal balance owing on this Note at any time may be evidenced by
endorsements on this Note or by Lender's internal records, including daily
computer print-outs. Lender will have no obligation to advance funds under this
Note if (a) Borrower or any guarantor is in default under the terms of this Note
or any agreement that Borrower or any guarantor has with Lender, including any
agreement made in connection with the signing of this Note; (b) Borrower or any
guarantor ceases doing business or is insolvent; (c) any guarantor seeks, claims
or otherwise attempts to limit, modify or revoke such guarantor's guarantee of
this Note or any other loan with Lender; (d) Borrower has applied funds
provided pursuant to this Note for purposes other than those authorized by
Lender; or (e) Lender in good faith deems itself insecure under this Note or any
other agreement between Lender and Borrower.
CREDIT TERMS AND CONDITIONS AGREEMENT. This Note is subject to the provisions of
the Credit Terms and Conditions Agreement dated June 6, 1998 and all amendments
thereto and replacements therefor.
05-19-1999 PROMISSORY NOTE Page 2
(Continued)
================================================================================
GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights or
remedies under this Note without losing them. Borrower and any other person who
signs, guarantees or endorses this Note, to the extent allowed by law, waive any
applicable statute of limitations, presentment, demand for payment, protest and
notice of dishonor. Upon any change in the terms of this Note, and unless
otherwise expressly slated in writing, no party who signs this Note, whether as
maker, guarantor, accommodation maker or endorser, shall be released from
liability. All such parties agree that Lender may renew or extend (repeatedly
and for any length of time) this loan, or release any party or guarantor or
collateral; or impair, fail to realize upon or perfect Lender's security
interest in the collateral; and take any other action deemed necessary by Lender
without the consent of or notice to anyone. All such parties also agree that
Lender may modify this loan without the consent of or notice to anyone other
than the party with whom the modification is made.
PRIOR TO, SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF
THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO
THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THE NOTE.
BORROWER:
MOTIVE COMMUNICATIONS, INC., A DELAWARE CORPORATION
By: /s/ Scott Harmon
-----------------------------------
SCOTT HARMON, PRESIDENT & CEO
================================================================================
June 5, 1998
Imperial Bank Borrower: Motive Communications, Inc.
Member FDIC
226 Airport Parkway
San Jose, CA 95110
Subject: Amended and Restated Credit Terms and Conditions ("Agreement")
Gentlemen:
To induce you to make loans to the undersigned (herein called "Borrower"), and
in consideration of any loan or loans you, in your sole discretion, may make to
Borrower, Borrower warrants and agrees as follows:
A. Borrower represents and warrants that:
1. Existence and Rights.
Borrower is a Delaware corporation.
Borrower is duly organized and existing and in good standing under the laws of
the State of Delaware and is authorized and in good standing to do business in
the State of Texas. Borrower has powers and adequate authority, rights and
franchises to own its property and to carry on its business as now conducted,
and is duly qualified and in good standing in each State in which the character
of the properties owned by it therein or the conduct of its business makes such
qualification necessary, and Borrower has the power and adequate authority to
make and carry out this Agreement. Borrower has no investment in any other
business entity.
2. Agreement Authorized. The execution, delivery and performance of this
Agreement are duly authorized and do not require the consent or approval of any
governmental body or other regulatory authority, are not in contravention of or
in conflict with any law or regulation or any term or provision of Borrower's
articles of incorporation, by-laws, or Articles of Association, as the case may
be, and this Agreement is the valid, binding and legally enforceable obligation
of Borrower in accordance with its terms.
3. No Conflict. The execution, delivery and performance of this Agreement
are not in contravention of or in conflict with any agreement, indenture or
undertaking to which Borrower is a party or by which it or any of its property
may be bound or affected, and do not cause any lien, charge or other encumbrance
to be created or imposed upon any such property by reason thereof.
4. Litigation. There is no litigation or other proceeding pending or
threatened against or affecting Borrower, and Borrower is not in default with
respect to any order, writ, injunction, decree or demand of any court or other
governmental or regulatory authority.
5. Financial Condition. The balance sheet of Borrower as of March 1998 and
the related profit and loss statement for the period ended on that date, a copy
of which has heretofore been delivered to you by Borrower, and all other
statements and data submitted in writing by Borrower to you in connection with
this request for credit are true and correct, and said balance sheet and profit
and loss statement truly present the financial condition of Borrower as of the
date thereof and the results of the operations of Borrower for the period
covered thereby, and have been prepared in accordance with generally accepted
accounting principles on a basis consistently maintained. Since such date there
have been no materially adverse changes in the financial condition or business
of Borrower. Borrower has no knowledge of any liabilities, contingent or
otherwise, at such date not reflected in said balance sheet, and Borrower has
not entered into any special commitments or substantial contracts which are not
reflected in said balance sheet, other than in the ordinary and normal course of
its business, which may have a materially adverse effect upon its financial
condition, operations or business as now conducted.
6. Title to Assets. Borrower has good title to its assets, and the same
are not subject to any liens or encumbrances other than those permitted by
Section C.3 hereof.
7. Tax Status. Borrower has no liability for any delinquent state, local
or federal taxes, and if Borrower has contracted with any government agency,
Borrower has no liability for negotiation of profits.
8. Trademarks, Patents. Borrower, as of the date hereof, possesses all
necessary trademarks, trade names, copyrights, patents, patent rights, and
licenses to conduct its business as now operated, without any known conflict
with the valid trademarks, trade names, copyrights, patents and license rights
of others.
9. Regulation U. The proceeds of this loan shall not be used to purchase or
carry margin stock (as defined with Regulation U of the Board of Governors of
the Federal Reserve system).
B. Borrower agrees that so long as it is indebted to you, it will, unless you
shall otherwise consent in writing:
1. Rights and Facilities. Maintain and preserve all rights, franchises and
other authority adequate for the conduct of its business; maintain its
properties, equipment and facilities in good order and repair, conduct its
business in an orderly manner without voluntary interruption and, if a
corporation or partnership, maintain and preserve its existence.
2. Insurance. Maintain public liability, property damage and workers'
compensation insurance and insurance, on all its insurable property against fire
and other hazards with responsible insurance: carriers to the extent usually
maintained by similar businesses.
3. Taxes and Other Liabilities. Pay and discharge, before the same become
delinquent and before penalties accrue thereon, all taxes, assessments and
governmental charges upon or against it or any of its properties, and all its
other liabilities at any time existing, except to the extent and so long as:
(a) The same are being contested in good faith and by appropriate proceedings in
such manners as not to cause any materially adverse effect upon its financial
condition or the loss of any right of redemption from any sale thereunder, and
(b) it shall have set aside on its books reserves (segregated to the extent
required by generally accepted accounting practice) deemed by it adequate with
respect thereto.
4. Records and Reports. Maintain a standard and modem system of accounting
in accordance with generally accepted accounting principles on a basis
consistently maintained; permit your representatives to have access to, and to
examine its properties, books and records at all reasonable times upon
reasonable notice; and furnish you:
(a) As soon as available, and in any event within 25 days attar the close or
each month of each fiscal year of Borrower, commencing with the month next
ending, a balance sheet, profit and loss statement and reconciliation of
Borrower's capital accounts as of the close of such period and covering
operations for the portion of Borrower's fiscal year ending on the last day of
such period, all in reasonable detail and stating in comparative form the
figures for the corresponding date and period in the previous fiscal year,
prepared in accordance with generally accepted accounting principles on a basis
consistently maintained by Borrower and certified by an appropriate officer of
Borrower, subject, however, to year end audit adjustments;
(b) As soon as available, compiled annual financial statements within 30 days
after fiscal year end for December 31, 1998 Thereafter, audited FYE statements
due within 90 days after the close of each fiscal year of Borrower, a report of
annual statements of Company as of the close of and for such fiscal year, all in
reasonable detail and stating in comparative form the figures as of the close of
and for the previous fiscal year, with the unqualified opinion of accountants
satisfactory to you.
(d) Promptly after the receipt thereof by Borrower, copies of any detailed audit
reports submitted to Borrower by independent accountants in connection with each
annual or interim audit of the accounts of Borrower made by such accountants;
(e) Promptly after the same are available, copies of all such proxy statements,
financial statements and reports as Borrower shall send to its stockholders, if
any, and copies of all reports which Borrower may file with the Securities and
Exchange Commission or any governmental authority at any time substituted
therefor, and
(f) Such other information relating to the affairs of Borrower as you reasonably
may request from time to time.
(c) Within 25 days after the close of each month of each fiscal year of
Borrower, a certificate by chief financial officer or partner of Borrower,
stating that Borrower has performed and observed each and every covenant
contained in this Letter of Inducement to be performed by it and that no event
has occurred and no condition then exists which constitutes an event of default
hereunder or would constitute such an event of default upon the lapse of time or
upon the giving of notice and the lapse of time specified herein, or, if any
such event has occurred or any such condition exists, specifying the nature
thereof;
(g) Notice of Default. Promptly notify the Bank in writing of the occurrence of
any event of default hereunder or any event which upon notice and lapse of time
would be an event of default
C. Borrower agrees that so long as it is indebted to you, it will not, without
your written consent:
1. Transactions Outside Ordinary Course. Enter into any transaction outside
the ordinary course of business except for the sale of capital stock to venture
investors, provided that Borrower promptly delivers written notification to Bank
of any such stock sale, and except for joint ventures, strategic alliances,
licensing and similar arrangements customary in Borrower's industry for business
similarly situated to Borrower and which do not require Borrower to assume or
otherwise become liable for the obligations of any third party not directly
related to or arising out of such arrangement, or require Borrower to transfer
ownership of assets to such joint venture or other entity.
2. Sell or Transfer of Collateral. Sell or transfer any collateral in which
Bank has been granted a security interest by Borrower.
3. Dividends. Pay or declare any dividends on Borrower's stock (except for
dividends payable solely in stock of Borrower).
4. Acquire Borrower's Stock. Redeem, retire, purchase or otherwise acquire,
directly or indirectly, any of Borrower's stock other than the repurchase of
Borrower's then issued stock from Borrower's employees or directors or service
providers pursuant to written agreements with Borrower under which Borrower has
the option to repurchase such stock at cost upon the occurrence of certain
events such as the termination of employment.
D. The occurrence of any one of the following events of default shall, at your
option, terminate your commitment to lend and make all sums of principal and
interest then remaining unpaid on all Borrower's indebtedness to you immediately
due and payable, all without demand, presentment or notice, all of which are
hereby expressly waived.
1. Failure to Pay. Failure to pay any installment of principal or of
interest on any indebtedness of Borrower to you for a period of two (2) days
after its due date.
2. Breach of Covenant. Failure of Borrower to perform any other term or
condition of this Agreement or any other agreement or document executed by
Borrower in favor of Bank binding upon Borrower for a period of ten (10) days
after notice from Bank.
3. Breach of Warranty. Any of Borrower's representations or warranties made
herein or any statement or certificate at any time given in writing pursuant
hereto or in connection herewith shall be false or misleading in any material
respect for a period of ten (10) days after notice from Bank.
4. Insolvency; Receiver or Trustee. Borrower shall become insolvent; or
admit its inability to pay its debts as they mature; or make an assignment for
the benefit of creditors; or apply for or consent to the appointment of a
receiver or trustee for it cc for a substantial part of its property or
business.
5. Judgments, Attachments. Any money judgment, writ or warrant of attachment,
or similar process shall be entered or filed against Borrower or any of its
assets and shall remain unvacated unbonded or unstayed for a period of 10 days
or in any event later than five days prior to the date of any proposed sale
thereunder.
6. Bankruptcy. Bankruptcy, insolvency, reorganization or liquidation
proceedings or other proceedings for relief under any bankruptcy law or any law
for the relief of debtors shall be instituted by or against Borrower and, if
instituted against it, shall be consented to.
E. Miscellaneous Provisions.
1. Failure or Indulgence Not Waiver. No failure or delay on the part
of your Bank or any holder of Notes issued hereunder, in the exercise of any
power, right or privilege hereunder shall operate as a waiver thereof; nor shall
any single or partial exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other right, power or privilege. All
rights and remedies existing under this agreement or any note issued in
connection with a loan that your Bank may make hereunder, are cumulative to, and
not exclusive of,
The Commitment Letter dated May 14, 1998, is attached hereto and incorporated
herein by this reference for additional terms. In the event of a conflict
between this Agreement and the Letter, the terms in the Letter shall take
precedence.
MOTIVE COMMUNICATIONS, INC.
By: /s/ Scott L. Harmon
-------------------------------
(Authorized Signature)
By: Scott L. Harmon
-------------------------------
(Print Name)
By: President & CEO
-------------------------------
(Title)
First Amendment to Amended and Restated Credit Terms and Conditions
and Attachment Thereto
This First Amendment ("Amendment") amends that certain Amended and
Restated Credit Terms and Conditions dated June 5, 1998 ("Credit Terms and
Conditions"), by and between Imperial Bank ("Bank") and Motive Communications,
Inc. ("Borrower") and the Commitment Letter attached thereto dated May 14, 1998
(the "Commitment Letter"), (collectively herein the Credit Terms and Conditions
and the Commitment Letter are referred to as the "Agreement") as follows:
1. The following Paragraph A. l0 is added to the Credit Terms and
Conditions:
"10. Borrower and its subsidiaries have reviewed the areas within their
operations and business which could be adversely affected by, and have
developed or are developing a program to address on a timely basis, the
Year 2000 Problem and have made related appropriate inquiry of material
suppliers and vendors, and based on such review and program, the Year
2000 Problem will not have a Material Adverse Effect upon its financial
condition, operations or business as now conducted. "Year 2000
Problem" means the possibility that any computer applications or
equipment used by Borrower may be unable to recognize and properly
perform date-sensitive functions involving certain dates prior to and
any dates on or after December 31, 1999."
2. The following Paragraph B.5 is added to the Credit Terms and
Conditions:
"5. YEAR 2000 COMPLIANCE. Borrower shall perform all acts reasonably
necessary to ensure that (a) Borrower and any business in which
Borrower holds a substantial interest, and (b) all customers, suppliers
and vendors that are material to Borrower's business, become Year 2000
Compliant in a timely manner. Such acts shall include, without
limitation, performing a comprehensive review and assessment of all
Borrower's systems and adopting a detailed plan, with itemized budget,
for the remediation, monitoring and testing of such systems. As used in
this paragraph, "Year 2000 Compliant" shall mean, in regard to any
entity, that all software, hardware, firmware, equipment, goods or
systems utilized by or material to the business operations or financial
condition of such entity, will properly perform date sensitive
functions before, during and after the year 2000. Borrower shall,
immediately upon request, provide to Bank such certifications or other
evidence of Borrower's compliance with the terms of this paragraph as
Bank may from time to time require."
3. The following Sections F, G and H are hereby added to the Agreement:
"F. Applicable Law. This Agreement and all other agreements and
instruments required by Bank in connection therewith shall be governed
by and construed according to the laws of the state of California.
G. Waiver of Jury Trial. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH
CANNOT BE WAIVED, THE BANK AND THE BORROWER EACH HEREBY WAIVES AND COVENANTS
THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT
TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE, CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT OR THE SUBJECT MATTER HEREOF OR THEREOF OR ANY OBLIGATION OR IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE BANK OR THE
BORROWER IN CONNECTION WITH ANY OF THE ABOVE, IN EACH CASE WHETHER NOW EXISTING
OR HEREAFTER ARISING AND WHETHER IN CONTRACT OR TORT OR OTHERWISE
H. Judicial Reference (a) Other than (i) non-judicial foreclosure and all
matters in connection therewith regarding security interests in real or personal
property; or (ii) the appointment of a receiver, or the exercise of other
provisional remedies (any and all of which may be initiated pursuant to
applicable law), each controversy, dispute or claim between the parties arising
out of or relating to this document ("Agreement"), which controversy, dispute or
claim is not settled in writing within thirty (30) days after the "Claim Date"
(defined as the date on which a party subject to the Agreement gives written
notice to all other parties that a controversy, dispute or claim exists), will
be settled by a reference proceeding in California in accordance with the
provisions of Section 638 et seq. of the California Code of Civil Procedure, or
their successor section ("CCP"), which shall constitute the exclusive remedy for
the settlement of any controversy, dispute or claim concerning this Agreement,
including whether such controversy, dispute or claim is subject to the reference
proceeding and except as set forth above, the parties waive their rights to
initiate any legal proceedings against each other in any court or jurisdiction
other than the Superior Court in the County where the Real Property, if any, is
located or Los Angeles County if none (the "Court"). The referee shall be a
retired Judge of the Court selected by mutual agreement of the parties, and if
they cannot so agree within forty-five (45) days after the Claim Date, the
referee shall be promptly selected by the Presiding Judge of the Court (or his
representative). The referee shall be appointed to sit as a temporary judge,
with all of the powers for a temporary judge, as authorized by law, and upon
selection should take and subscribe to the oath of office as provided for in
Rule 244 of the California Rules of Court (or any subsequently enacted Rule).
Each party shall have one peremptory challenge pursuant to CCP (S)170.6. The
referee shall (a) be requested to set the matter for hearing within sixty (60)
days after the Claim Date and (b) try any and all issues of law or fact and
report a statement of decision upon them, if possible, within ninety (90) days
of the Claim Date. Any decision rendered by the referee will be final, binding
and conclusive and judgment shall be entered pursuant to CCP (S)644 in any court
in the State of California having jurisdiction. Any party may apply for a
reference proceeding at any time after thirty (30) days following notice to any
other party of the nature of the controversy, dispute or claim, by filing a
petition for a hearing and/or trial. All discovery permitted by this Agreement
shall be completed no later than fifteen (15) days before the first hearing date
established
2
by the referee. The referee may extend such period in the event of a
party's refusal to provide requested discovery for any reason whatsoever,
including, without limitation, legal objections raised to such discovery or
unavailability of a witness due to absence or illness. No party shall be
entitled to "priority" in conducting discovery. Depositions may be taken by
either party upon seven (7) days written notice, and request for production
or inspection of documents shall be responded to within ten (10) days after
service. All disputes relating to discovery which cannot be resolved by the
parties shall be submitted to the referee whose decision shall be final and
binding upon the parties. Pending appointment of the referee as provided
herein, the Superior Court is empowered to issue temporary and/or
provisional remedies, as appropriate.
(b) Except as expressly set forth in this Agreement, the referee shall
determine the manner in which the reference proceeding is conducted
including the time and place of all hearings, the order of presentation of
evidence, and all other questions that arise with respect to the course of
the reference proceeding. All proceedings and hearings conducted before the
referee, except for trial, shall be conducted without a court reporter,
except that when any party so requests, a court reporter will be used at
any hearing conducted before the referee. The party making such a request
shall have the obligation to arrange for and pay for the court reporter.
The costs of the court reporter at the trial shall be borne equally by the
parties.
(c) The referee shall be required to determine all issues in accordance
with existing case law and the statutory laws of the State of California.
The rules of evidence applicable to proceedings at law in the State of
California will be applicable to the reference proceeding. The referee
shall be empowered to enter equitable as well as legal relief, to provide
all temporary and/or provisional remedies and to enter equitable orders
that will be binding upon the parties. The referee shall issue a single
judgment at the close of the reference proceeding which shall dispose of
all of the claims of the parties that are the subject of the reference. The
parties hereto expressly reserve the right to contest or appeal from the
final judgment or any appealable order or appealable judgment entered by
the referee. The parties hereto expressly reserve the right to findings of
fact, conclusions of law, a written statement of decision, and the right to
move for a new trial or a different judgment, which new trial, if granted,
is also to be a reference proceeding under this provision.
(d) In the event that the enabling legislation which provides for
appointment of a referee is repealed (and no successor statute is enacted),
any dispute between the parties that would otherwise be determined by the
reference procedure herein described will be resolved and determined by
arbitration. The arbitration will be conducted by a retired judge of the
Court, in accordance with the California Arbitration Act, (S)1280 through
(S)1294.2 of the CCP as amended from time to time. The limitations with
respect to discovery as set forth hereinabove shall apply to any such
arbitration proceeding.
4 The last paragraph of the Credit Terms and Conditions is hereby amended in
full to read as follows:
3
"The Commitment Letter dated, April 29, 1999 as may be amended or
replaced, (the "Letter") is attached hereto and incorporated herein by this
reference for additional terms. In the event of a conflict between this
Agreement and the term of the Letter the terms in the Letter shall take
precedence."
5. Except as provided above, the Agreement remains unchanged and in full force
and effect.
6. This Amendment is effective as of May 19, 1999 and the parties hereby
confirm that the Agreement as amended is in full force and effect.
Motive Communications, Inc.
By: /s/ Scott L. Harmon
---------------------------
Name: Scott L. Harmon
-------------------------
Title: President & CEO
------------------------
Imperial Bank
By:____________________________
Name:__________________________
Title:_________________________
4
Exhibit A-E
Pursuant to Item 601(b) (2) of Regulation S-K, this exhibit has been omitted.
Such exhibit will be submitted to the Securities and Exchange Commission upon
request.
Dates Referenced Herein
| Referenced-On Page |
|---|
| This ‘S-1’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| | 11/19/02 | | 1 | | | | | None on these Dates |
| Filed on: | | 7/13/00 |
| | 6/19/00 | | 1 |
| | 5/19/00 | | 1 |
| | 5/17/00 | | 6 |
| | 12/31/99 | | 11 |
| | 6/19/99 | | 1 | | 6 |
| | 5/19/99 | | 1 | | 14 |
| | 4/29/99 | | 14 |
| | 12/31/98 | | 9 |
| | 6/6/98 | | 7 |
| | 6/5/98 | | 3 | | 11 |
| | 5/14/98 | | 10 | | 11 |
| List all Filings |
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