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EX-99 - ADDITIONAL EXHIBITS - AutoWeb, Inc. | ex99-1.htm |
8-K - PRIMARY DOCUMENT - AutoWeb, Inc. | auto8k_apr172020.htm |
Exhibit 10.1
Paycheck
Protection Program Term Note
|
|
$1,383,990.00
|
April
16, 2020
|
FOR VALUE RECEIVED,
AUTOWEB, INC. (the
“Borrower”),
with an address at 18872 MACARTHUR BOULEVARD SUITE 200, IRVINE,
CALIFORNIA 92612-1427, promises to pay to the order of
PNC BANK, NATIONAL ASSOCIATION (the
“Bank”),
in lawful money of the United States of America in immediately
available funds at its offices located at 222 Delaware Avenue,
Wilmington, Delaware 19801, Attn: Business Banking, or at such
other location as the Bank may designate from time to time, the
principal sum of
$1,383,990.00 (the
“Facility”),
together with interest accruing on the outstanding principal
balance from the date hereof, all as provided below. This Note is
being issued pursuant to the Coronavirus Aid, Relief, and Economic
Security (CARES) Act’s Paycheck Protection Program (the
“Program”).
1.
Rate of Interest.
Amounts
outstanding under this Note will bear interest at a rate per annum
(“Fixed
Rate”)
which is at all times equal to 1.00%. Interest will be calculated
based on the actual number of days that principal is outstanding
over a year of 360 days. In no event will the rate of interest
hereunder exceed the maximum rate allowed by
law.
2.
Structure; Payment Terms.
During
the period (the “Deferral
Period”)
beginning on the date of this Note and ending on the 6 month
anniversary of the date of this Note (the
“Deferral
Expiration Date”),
interest on the outstanding principal balance will accrue at the
Fixed Rate, but neither principal nor interest shall be due and
payable during the Deferral Period. On the Deferral Expiration
Date, the outstanding principal of the Facility that is not
forgiven under the Program (the “Conversion Balance”)
shall convert to an amortizing term loan payable as set forth
below.
On the
15th
day of
the 7th
month
following the date of this Note (the “First
Payment Date”),
all accrued interest that is not forgiven under the Program shall
be due and payable. Additionally, on the First Payment Date, and
continuing on the 15th day of each month thereafter until the
2nd
anniversary
of the date of this Note (the “Maturity
Date”),
equal installments of principal shall be due and payable, each in
an amount determined by dividing the Conversion Balance by 18 (the
“Monthly
Principal Amount”).
Interest shall be payable at the same times as the Monthly
Principal Amount. Any outstanding principal and accrued interest
shall be due and payable in full on the Maturity
Date.
If any
payment under this Note shall become due on a day other than a
Business Day, such payment shall be made on the next succeeding
Business Day and such extension of time shall be included in
computing interest in connection with such payment.
“Business
Day”
shall mean any day other than a Saturday or Sunday or a legal
holiday on which commercial banks are authorized or required by law
to be closed for business in the State of Delaware. The Borrower
hereby authorizes the Bank to charge the Borrower’s deposit
account at the Bank for any payment when due. Payments received
will be applied to charges, fees and expenses (including
attorneys’ fees), accrued interest and principal in any order
the Bank may choose, in its sole
discretion.
3.
Forgiveness of the Facility.
The
Borrower may apply to the Bank for forgiveness of the amount due on
this Facility in an amount based on the sum of the following costs
incurred by the Borrower during the 8-week period beginning on the
date of first disbursement of this Facility: (a) payroll costs; (b)
any payment of interest on a covered mortgage obligation (which
shall not include any prepayment of or payment of principal on a
covered mortgage obligation); (c) any payment on a covered rent
obligation; and (d) any covered utility
payment.
The amount of forgiveness shall be calculated (and may be reduced)
in accordance with the requirements of the Program, including the
provisions of Section 1106 of the Coronavirus Aid, Relief, and
Economic Security Act (CARES
Act) (P.L. 116-136). Not more than 25% of the amount forgiven can
be attributable to non-payroll costs. If the Borrower has received
an EIDL (as defined in the attached Certification), the amount of
such loan shall be subtracted from the loan forgiveness
amount.
-1-
4.
Late Payments; Default Rate.
If the
Borrower fails to make any payment of principal, interest or other
amount coming due pursuant to the provisions of this Note within
fifteen (15) calendar days of the date due and payable, the
Borrower also shall pay to the Bank a late charge equal to the
lesser of five percent (5%) of the amount of such payment or
$100.00 (the “Late
Charge”).
Such fifteen (15) day period shall not be construed in any way to
extend the due date of any such payment. Upon maturity, whether by
acceleration, demand or otherwise, and at the Bank’s option
upon the occurrence of any Event of Default (as hereinafter
defined) and during the continuance thereof, each advance
outstanding under this Note shall bear interest at a rate per annum
(based on the actual number of days that principal is outstanding
over a year of 360 days) which shall be five percentage points
(5.00%) in excess of the interest rate in effect from time to time
under this Note but not more than the maximum rate allowed by law
(the “Default
Rate”).
The Default Rate shall continue to apply whether or not judgment
shall be entered on this Note. Both the Late Charge and the Default
Rate are imposed as liquidated damages for the purpose of defraying
the Bank’s expenses incident to the handling of delinquent
payments, but are in addition to, and not in lieu of, the
Bank’s exercise of any rights and remedies hereunder, under
the other Loan Documents (as defined below) or under applicable
law, and any fees and expenses of any agents or attorneys which the
Bank may employ. In addition, the Default Rate reflects the
increased credit risk to the Bank of carrying a loan that is in
default. The Borrower agrees that the Late Charge and Default Rate
are reasonable forecasts of just compensation for anticipated and
actual harm incurred by the Bank, and that the actual harm incurred
by the Bank cannot be estimated with certainty and without
difficulty. As used in this Note, “Loan
Documents”
means, individually and collectively, this Note, together with all
other agreements and documents executed and/or delivered in
connection with this Note or referred to in this Note, as amended,
modified or renewed from time to time.
5.
Prepayment.
The
Borrower shall have the right to prepay any amounts outstanding
under this Note at any time and from time to time, in whole or in
part, without penalty.
6.
Increased Costs; Yield Protection.
On
written demand, together with written evidence of the justification
therefor, the Borrower agrees to pay the Bank all direct costs
incurred, any losses suffered or payments made by the Bank as a
result of any Change in Law (hereinafter defined), imposing any
reserve, deposit, allocation of capital or similar requirement
(including without limitation, Regulation D of the Board of
Governors of the Federal Reserve System) on the Bank, its holding
company or any of their respective assets relative to the Facility.
“Change
in Law”
means the occurrence, after the date of this Note, of any of the
following: (a) the adoption or taking effect of any law, rule,
regulation or treaty, (b) any change in any law, rule, regulation
or treaty or in the administration, interpretation, implementation
or application thereof by any governmental authority or (c) the
making or issuance of any request, rule, guideline or directive
(whether or not having the force of law) by any governmental
authority; provided that notwithstanding anything herein to the
contrary, (x) the Dodd-Frank Wall Street Reform and Consumer
Protection Act and all requests, rules, guidelines or directives
thereunder or issued in connection therewith and (y) all requests,
rules, guidelines or directives promulgated by the Bank for
International Settlements, the Basel Committee on Banking
Supervision (or any successor or similar authority) or the United
States or foreign regulatory authorities, in each case pursuant to
Basel III, shall in each case be deemed to be a “Change in
Law”, regardless of the date enacted, adopted or
issued.
7.
Representations, Warranties and Covenants.
(a) The
Borrower hereby represents and warrants that, if not a natural
person, the Borrower is duly organized, validly existing and in
good standing under the laws of the state of its incorporation or
organization and has the power and authority to own and operate its
assets and to conduct its business as now or proposed to be carried
on, and is duly qualified, licensed and in good standing to do
business in all jurisdictions where its ownership of property or
the nature of its business requires such qualification or
licensing. The Borrower further hereby represents and warrants that
it was duly organized, validly existing and in good standing as of
February 15, 2020 and had employees for whom it paid salaries and
payroll taxes or paid independent contractors, as reported on a
Form 1099-MISC.
-2-
(b) The
Borrower certifies, acknowledges and agrees that the certifications
contained in the Paycheck Protection Program Certification and the
Program application delivered to the Bank are true and correct,
which certifications are hereby incorporated herein by this
reference as if set forth herein.
(c) The
Borrower covenants and agrees that the Borrower will do all things
necessary to (i) maintain, renew and keep in full force and effect
its organizational existence and all rights, permits and franchises
necessary to enable it to continue its business as currently
conducted; (ii) continue in operation in substantially the same
manner as at present, to the extent permitted by applicable law
(including without limitation any statute, ordinance, rule or
regulation relating to employment practices, pension benefits or
environmental, occupational and health standards and controls); and
(iii) comply with all laws applicable to the Borrower and to the
operation of its business (including without limitation any
statute, ordinance, rule or regulation relating to employment
practices, pension benefits or environmental, occupational and
health standards and controls).
(d) The
Borrower covenants and agrees that, without the Bank’s prior
written consent, the Borrower shall not make or permit any change
in (i) the composition of its current executive management; (ii)
its ownership or equity structure; or (iii) its form of
organization, including a division into two or more entities. The
Borrower will not make any distribution of company assets that
would adversely affect its financial condition, or transfer
(including pledging) or dispose of any assets, except in the
ordinary course of business.
(e) The
Borrower represents and warrants that (i) the Borrower has full
power and authority to enter into the transactions provided for in
this Note and the other Loan Documents; (ii) all
necessary action to authorize the execution and delivery of this
Note and the other Loan Documents has been properly taken; (iii)
this Note and the other Loan Documents, when executed and delivered
by the Borrower, will constitute the legal, valid and binding
obligations of the Borrower enforceable in accordance with their
terms; (iv) the Borrower is and will continue to be duly authorized
to perform all of the terms and provisions of this Note and the
other Loan Documents; (v) there does not exist, either before or
after giving effect to the terms of this Note, any default or
violation by the Borrower of or under any of the terms, conditions
or obligations of any of its governing documents; and (vi) the
Borrower does not require the consent of any party with respect to
this Note, the other Loan Documents or the Facility except for such
consents that have been obtained.
(f) The
Borrower covenants and agrees to take all such additional actions
and promptly provide to the Bank all additional documents,
statements and information as the Bank may require from time to
time, in its discretion, in connection with the SBA’s
requirements or requests under or in respect of the Program or the
general standard operating procedures of the
SBA.
(g) The
Borrower authorizes and directs the Bank to disburse the proceeds
of the Facility and to direct payments due under the Facility in
accordance with the Disbursement and Payment Authorization
Instructions attached to this Note as
Exhibit A.
8.
Other Loan Documents.
Notwithstanding
any provision to the contrary in any Loan Document or any other
collateral security documents that may have been or may in the
future be executed and delivered to the Bank, or an agent acting on
behalf of the Bank, to secure any obligations of the Borrower to
the Bank, this Note is not intended to be secured by real property,
and the applicability of any lien on such real property to secure
this Note is expressly disclaimed by the
Bank.
-3-
9.
Events of Default.
The
occurrence of any of the following events will be deemed to be an
“Event
of Default”
under this Note: (i) the nonpayment of any principal, interest or
other indebtedness under this Note when due; (ii) the occurrence of
any event of default or any default and the lapse of any notice or
cure period, or the Borrower’s failure to observe or perform
any covenant or other agreement, under or contained in any Loan
Document; (iii) the filing by or against the Borrower of any
proceeding in bankruptcy, receivership, insolvency, reorganization,
liquidation, conservatorship or similar proceeding (and, in the
case of any such proceeding instituted against the Borrower, such
proceeding is not dismissed or stayed within 30 days of the
commencement thereof, provided that the Bank shall not be obligated
to advance additional funds hereunder during such period); (iv) any
assignment by the Borrower for the benefit of creditors, or any
levy, garnishment, attachment or similar proceeding is instituted
against any property of the Borrower held by or deposited with the
Bank; (v) the commencement of any foreclosure or forfeiture
proceeding, execution or attachment against any collateral securing
the obligations of the Borrower to the Bank; (vi) the entry of a
final judgment against the Borrower and the failure of the Borrower
to discharge the judgment within ten (10) days of the entry
thereof; (vii) any merger, consolidation, division or other
reorganization of, with or by the Borrower, or the sale or other
transfer of all or any substantial part of the Borrower’s
property or assets; (viii) any change in the Borrower’s
business, assets, operations, financial condition or results of
operations or equity ownership that has or could reasonably be
expected to have any material adverse effect on the Borrower; (ix)
the Borrower ceases doing business as a going concern; (x) any
representation or warranty made by the Borrower to the Bank in any
Loan Document or any other documents now or in the future
evidencing or securing the obligations of the Borrower to the Bank,
is false, erroneous or misleading in any material respect; (xi) the
death, incarceration, indictment or legal incompetency of any
individual Borrower or, if the Borrower is a partnership or limited
liability company, the death, incarceration, indictment or legal
incompetency of any individual general partner or member; or (xii)
failure of the Borrower to notify the Bank within ten (10) days of
any change of the Borrower’s
address.
Upon the occurrence of an Event of Default: (a) the Bank shall be
under no further obligation to make advances hereunder; (b) if an
Event of Default specified in clause (iii) or (iv) above shall
occur, the outstanding principal balance and accrued interest
hereunder together with any additional amounts payable hereunder
shall be immediately due and payable without demand or notice of
any kind; (c) if any other Event of Default shall occur, the
outstanding principal balance and accrued interest hereunder
together with any additional amounts payable hereunder, at the
Bank’s option and without demand or notice of any kind, may
be accelerated and become immediately due and payable; (d) at the
Bank’s option, this Note will bear interest at the Default
Rate from the date of the occurrence of the Event of Default; and
(e) the Bank may exercise from time to time any of the rights and
remedies available under the Loan Documents or under applicable
law. The Borrower acknowledges that upon the occurrence of an Event
of Default, SBA, as defined below, may be required to pay the
Lender under the SBA guarantee, and SBA may then seek recovery on
the Facility (to the extent any balance remains after loan
forgiveness).
10.
Right of Setoff.
In
addition to all liens upon and rights of setoff against the
Borrower’s money, securities or other property given to the
Bank by law, the Bank shall have, with respect to the
Borrower’s obligations to the Bank under this Note and to the
extent permitted by law, a contractual possessory security interest
in and a contractual right of setoff against, and the Borrower
hereby grants the Bank a security interest in, and hereby assigns,
conveys, delivers, pledges and transfers to the Bank, all of the
Borrower’s right, title and interest in and to, all of the
Borrower’s deposits, moneys, securities and other property
now or hereafter in the possession of or on deposit with, or in
transit to, the Bank or any other direct or indirect subsidiary of
The PNC Financial Services Group, Inc., whether held in a general
or special account or deposit, whether held jointly with someone
else, or whether held for safekeeping or otherwise, excluding,
however, all IRA, Keogh, and trust accounts. Every such security
interest and right of setoff may be exercised without demand upon
or notice to the Borrower. Every such right of setoff shall be
deemed to have been exercised immediately upon the occurrence of an
Event of Default hereunder without any action of the Bank, although
the Bank may enter such setoff on its books and records at a later
time.
-4-
11.
Financial and Other Information.
Within
forty five (45) days after the Bank’s request, the Borrower
agrees to deliver any financial and other business and ownership
information concerning the Borrower that the Bank may request from
time to time, such as annual and interim financial statements (all
of which shall be prepared in accordance with generally accepted
accounting principles), federal income tax returns. The Borrower
also agrees to deliver to the Bank, promptly upon the Bank’s
request, certification(s) of beneficial owners in the form
requested by the Bank (as executed and delivered to the Bank on or
prior to the date of this Note and updated from time to time, the
“Certification
of Beneficial Owners”).
If the Borrower was required to execute and deliver to the Bank a
Certification of Beneficial Owners, (a) the Borrower represents and
warrants, as of the date of this Note and as of the date each
updated Certification of Beneficial Owners is provided to the Bank,
that the information in the Certification of Beneficial Owners is
true, complete and correct, and (b) the Borrower agrees to provide
confirmation of the accuracy of the information set forth in the
Certification of Beneficial Owners, or deliver a new Certification
of Beneficial Owners in form and substance acceptable to the Bank,
as and when requested by the Bank and/or when any individual
identified on the most recent Certification of Beneficial Owners
provided to the Bank as a controlling party and/or a direct or
indirect individual owner has changed. The Borrower further agrees
to provide such other information and documentation as may
reasonably be requested by the Bank from time to time for purposes
of compliance by the Bank with applicable laws (including without
limitation the USA PATRIOT Act and other “know your
customer” and anti-money laundering rules and regulations),
and any policy or procedure implemented by the Bank to comply
therewith. Additionally, the Borrower will keep books and records
in a manner satisfactory to the Bank and allow the Bank and SBA to
inspect and audit books, records and papers relating to the
Borrower’s financial or business
condition.
12.
Anti-Money Laundering/International Trade Law
Compliance.
The
Borrower represents and warrants to the Bank, as of the date of
this Note, the date of each advance of proceeds under the Facility,
the date of any renewal, extension or modification of the Facility,
and at all times until the Facility has been terminated and all
amounts thereunder have been indefeasibly paid in full, that: (a)
no Covered Entity (i) is a Sanctioned Person; (ii) has any of its
assets in a Sanctioned Country or in the possession, custody or
control of a Sanctioned Person; or (iii) does business in or with,
or derives any of its operating income from investments in or
transactions with, any Sanctioned Country or Sanctioned Person in
violation of any law, regulation, order or directive enforced by
any Compliance Authority; (b) the proceeds of the Facility will not
be used to fund any operations in, finance any investments or
activities in, or, make any payments to, a Sanctioned Country or
Sanctioned Person in violation of any law, regulation, order or
directive enforced by any Compliance Authority; (c) the funds used
to repay the Facility are not derived from any unlawful activity;
and (d) each Covered Entity is in compliance with, and no Covered
Entity engages in any dealings or transactions prohibited by, any
laws of the United States, including but not limited to any
Anti-Terrorism Laws. Borrower covenants and agrees that it shall
immediately notify the Bank in writing upon the occurrence of a
Reportable Compliance Event.
As
used herein: “Anti-Terrorism
Laws”
means any laws relating to terrorism, trade sanctions programs and
embargoes, import/export licensing, money laundering, or bribery,
all as amended, supplemented or replaced from time to time;
“Compliance
Authority” means
each and all of the (a) U.S. Treasury Department/Office of Foreign
Assets Control, (b) U.S. Treasury Department/Financial Crimes
Enforcement Network, (c) U.S. State Department/Directorate of
Defense Trade Controls, (d) U.S. Commerce Department/Bureau of
Industry and Security, (e) U.S. Internal Revenue Service, (f) U.S.
Justice Department, and (g) U.S. Securities and Exchange
Commission; “Covered
Entity”
means the Borrower, its affiliates and subsidiaries, all
guarantors, pledgors of collateral, all owners of the foregoing,
and all brokers or other agents of the Borrower acting in any
capacity in connection with the Facility;
“Reportable
Compliance Event”
means that any Covered Entity becomes a Sanctioned Person, or is
indicted, arraigned, investigated or custodially detained, or
receives an inquiry from regulatory or law enforcement officials,
in connection with any Anti-Terrorism Law or any predicate crime to
any Anti-Terrorism Law, or self-discovers facts or circumstances
implicating any aspect of its operations with the actual or
possible violation of any Anti-Terrorism Law;
“Sanctioned
Country”
means a country subject to a sanctions program maintained by any
Compliance Authority; and “Sanctioned
Person”
means any individual person, group, regime, entity or thing listed
or otherwise recognized as a specially designated, prohibited,
sanctioned or debarred person or entity, or subject to any
limitations or prohibitions (including but not limited to the
blocking of property or rejection of transactions), under any order
or directive of any Compliance Authority or otherwise subject to,
or specially designated under, any sanctions program maintained by
any Compliance Authority.
-5-
13.
Indemnity.
The
Borrower agrees to indemnify each of the Bank, each legal entity,
if any, who controls, is controlled by or is under common control
with the Bank, and each of their respective directors, officers and
employees (the “Indemnified
Parties”),
and to defend and hold each Indemnified Party harmless from and
against any and all claims, damages, losses, liabilities and
expenses (including all fees and charges of internal or external
counsel with whom any Indemnified Party may consult and all
expenses of litigation and preparation therefor) which any
Indemnified Party may incur or which may be asserted against any
Indemnified Party by any person, entity or governmental authority
(including any person or entity claiming derivatively on behalf of
the Borrower), in connection with or arising out of or relating to
the matters referred to in this Note or in the other Loan Documents
or the use of any advance hereunder, whether (a) arising from or
incurred in connection with any breach of a representation,
warranty or covenant by the Borrower, or (b) arising out of or
resulting from any suit, action, claim, proceeding or governmental
investigation, pending or threatened, whether based on statute,
regulation or order, or tort, or contract or otherwise, before any
court or governmental authority;
provided,
however, that
the foregoing indemnity agreement shall not apply to any claims,
damages, losses, liabilities and expenses solely attributable to an
Indemnified Party's gross negligence or willful misconduct. The
indemnity agreement contained in this Paragraph shall survive the
termination of this Note, payment of any advance hereunder and the
assignment of any rights hereunder. The Borrower may participate at
its expense in the defense of any such action or
claim.
14.
Miscellaneous.
All
notices, demands, requests, consents, approvals and other
communications required or permitted hereunder
(“Notices”)
must be in writing (except as may be agreed otherwise above with
respect to borrowing requests or as otherwise provided in this
Note) and will be effective upon receipt. Notices may be given in
any manner to which the parties may agree. Without limiting the
foregoing, first-class mail, postage prepaid, facsimile
transmission and commercial courier service are hereby agreed to as
acceptable methods for giving Notices. In addition, the parties
agree that Notices may be sent electronically to any electronic
address provided by a party from time to time. Notices may be sent
to a party’s address as set forth above or to such other
address as any party may give to the other for such purpose in
accordance with this paragraph. No delay or omission on the
Bank’s part to exercise any right or power arising hereunder
will impair any such right or power or be considered a waiver of
any such right or power, nor will the Bank’s action or
inaction impair any such right or power. The Bank’s rights
and remedies hereunder are cumulative and not exclusive of any
other rights or remedies which the Bank may have under other
agreements, at law or in equity. No modification, amendment or
waiver of, or consent to any departure by the Borrower from, any
provision of this Note will be effective unless made in a writing
signed by the Bank, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for
which given. Notwithstanding the foregoing, the Bank may modify
this Note for the purposes of completing missing content or
correcting erroneous content, without the need for a written
amendment, provided that the Bank shall send a copy of any such
modification to the Borrower (which notice may be given by
electronic mail). The Borrower agrees to pay on demand, to the
extent permitted by law, all costs and expenses incurred by the
Bank in the enforcement of its rights in this Note and in any
security therefor, including without limitation reasonable fees and
expenses of the Bank’s counsel. If any provision of this Note
is found to be invalid, illegal or unenforceable in any respect by
a court, all the other provisions of this Note will remain in full
force and effect. The Borrower and all other makers and indorsers
of this Note hereby forever waive presentment, protest, notice of
dishonor and notice of non-payment. The Borrower also waives all
defenses based on suretyship or impairment of collateral. If this
Note is executed by more than one Borrower, the obligations of such
persons or entities hereunder will be joint and several. This Note
shall bind the Borrower and its heirs, executors, administrators,
successors and assigns, and the benefits hereof shall inure to the
benefit of the Bank and its successors and assigns;
provided,
however, that
the Borrower may not assign this Note in whole or in part without
the Bank’s written consent and the Bank at any time may
assign this Note in whole or in part.
-6-
This Note has been delivered to and accepted by the Bank and will
be deemed to be made in the State of
Delaware.
THIS
NOTE
WILL BE INTERPRETED AND THE RIGHTS AND LIABILITIES OF THE
BANK
AND THE
BORROWER
DETERMINED IN ACCORDANCE WITH
(I)
FEDERAL REGULATIONS,
AND
(II)
TO THE EXTENT NOT
PREEMPTED BY FEDERAL LAWS OR REGULATIONS,
THE LAWS OF THE
STATE
OF
DELAWARE,
EXCLUDING ITS CONFLICT OF LAWS RULES, INCLUDING
WITHOUT LIMITATION THE
ELECTRONIC
TRANSACTIONS
ACT
(OR
EQUIVALENT)
IN EFFECT IN THE
STATE
OF
DELAWARE
(OR,
TO THE EXTENT CONTROLLING,
THE LAWS OF THE
UNITED
STATES
OF
AMERICA,
INCLUDING WITHOUT LIMITATION THE
ELECTRONIC
SIGNATURES
IN
GLOBAL
AND
NATIONAL
COMMERCE
ACT). The
Borrower hereby irrevocably consents to the exclusive jurisdiction
of any state or federal court in the State of Delaware; provided
that nothing contained in this Note will prevent the Bank from
bringing any action, enforcing any award or judgment or exercising
any rights against the Borrower individually, against any security
or against any property of the Borrower within any other county,
state or other foreign or domestic jurisdiction. The Borrower
acknowledges and agrees that the venue provided above is the most
convenient forum for both the Bank and the Borrower. The Borrower
waives any objection to venue and any objection based on a more
convenient forum in any action instituted under this
Note.
15.
Commercial Purpose.
The
Borrower represents that the indebtedness evidenced by this Note is
being incurred by the Borrower solely for the purpose of acquiring
or carrying on a business, professional or commercial activity, and
not for personal, family or household
purposes.
16.
USA PATRIOT Act Notice.
To
help the government fight the funding of terrorism and money
laundering activities, Federal law requires all financial
institutions to obtain, verify and record information that
identifies each Borrower that opens an account. What this means:
when the Borrower opens an account, the Bank will ask for the
business name, business address, taxpayer identifying number and
other information that will allow the Bank to identify the
Borrower, such as organizational documents. For some businesses and
organizations, the Bank may also need to ask for identifying
information and documentation relating to certain individuals
associated with the business or
organization.
17.
Authorization to Obtain Credit Reports.
By
signing below, each person, who is signing in his or her individual
capacity, requests and provides written authorization to the Bank
or its designee (and any assignee or potential assignee hereof) to
obtain such individual’s personal credit profile from one or
more national credit bureaus. This authorization extends to
obtaining a credit profile in (i) considering an application for
credit that is evidenced, guaranteed or secured by this document,
(ii) assessing creditworthiness and (iii) considering extensions of
credit, including on an ongoing basis, as necessary for the
purposes of (a) update, renewal or extension of such credit or
additional credit, (b) reviewing, administering or collecting the
resulting account and (c) reporting on the repayment and
satisfaction of such credit obligations. By signing below, such
individual further ratifies and confirms his or her prior requests
and authorizations with respect to the matters set forth herein.
For the avoidance of doubt, this provision does not apply to
persons signing below in their capacities as officers or other
authorized representatives of entities, organizations or
governmental bodies.
18.
Electronic Signatures and Records.
Notwithstanding
any other provision herein, the Borrower agrees that this Note, the
Loan Documents, any amendments thereto, and any other information,
notice, signature card, agreement or authorization related thereto
(each, a “Communication”)
may, at the Bank’s option, be in the form of an electronic
record. Any Communication may, at the Bank’s option, be
signed or executed using electronic signatures. For the avoidance
of doubt, the authorization under this paragraph may include,
without limitation, use or acceptance by the Bank of a manually
signed paper Communication which has been converted into electronic
form (such as scanned into PDF format) for transmission, delivery
and/or retention.
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19.
Depository.
Unless
the Bank otherwise agrees, the Borrower will establish and maintain
with the Bank the Borrower’s primary depository
accounts.
20.
Federal Law.
When
the U.S. Small Business Administration (“SBA”)
is the holder, this Note will be interpreted and enforced under
federal law, including SBA regulations. The Bank or SBA may use
state or local procedures for filing papers, recording documents,
giving notice, foreclosing liens, and other purposes. By using such
procedures, SBA does not waive any federal immunity from state or
local control, penalty, tax, or liability. As to this Note, the
Borrower may not claim or assert against SBA any local or state law
to deny any obligation, defeat any claim of SBA, or preempt federal
law.
21.
Non-Recourse.
The
Borrower and SBA shall have no recourse against any individual
shareholder, member or partner of the Borrower for non-payment of
the Facility, except to the extent that such shareholder, member or
partner uses the loan proceeds for an unauthorized
purpose.
22.
DISPUTE RESOLUTIONS.
(a) WAIVER
OF JURY TRIAL. FOR
ANY DISPUTE THAT IS NOT ARBITRATED,
AND TO THE
EXTENT PERMITTED BY APPLICABLE LAW, THE
BORROWER
AND THE BANK IRREVOCABLY WAIVES ANY
AND
ALL RIGHTS THE BORROWER
OR THE BANK MAY HAVE TO A TRIAL BY JURY IN ANY
ACTION,
PROCEEDING OR
CLAIM OF ANY NATURE RELATING TO THIS NOTE,
ANY DOCUMENTS EXECUTED IN CONNECTION WITH THIS NOTE
OR ANY TRANSACTION CONTEMPLATED IN ANY OF SUCH
DOCUMENTS. THE
BORROWER
ACKNOWLEDGES THAT THE FOREGOING WAIVER IS KNOWING AND
VOLUNTARY.
(b) ARBITRATION
OF DISPUTES. The
Borrower or the Bank may elect to submit any and all disputes
arising out of or relating to the Loan Documents or any breach
thereof (a “Dispute”)
to binding arbitration
(i) Arbitration.
Any arbitration shall be conducted pursuant to and in accordance
with the AAA Commercial Arbitration Rules and, where applicable,
the Supplementary Rules for Large, Complex Commercial Disputes, and
judgment upon the award rendered by the arbitrator may be entered
in any court having jurisdiction thereof. Such arbitration shall be
conducted in a mutually acceptable location. Except as expressly
set forth below, the procedures specified herein shall be the sole
and exclusive procedures for the resolution of Disputes; provided,
however, that the Borrower or the Bank may seek provisional or
ancillary remedies, such as preliminary injunctive relief, from a
court having jurisdiction, before, during or after the pendency of
any arbitration proceeding. The institution and maintenance of any
action for such judicial relief, or pursuit of provisional or
ancillary remedies, shall not constitute a waiver of the right or
obligation of any party to submit any claim or dispute to
arbitration. Nothing herein shall in any way limit or modify any
remedies available to the Bank under the Loan Documents or
otherwise at law or in equity.
(ii) Motion
Practice. In
any arbitration hereunder, the arbitrator(s) shall decide any
prehearing motions which are substantially similar to pre-hearing
motions to dismiss for failure to state a claim or motions for
summary adjudication.
(iii) Discovery.
Discovery shall be limited to the pre-hearing exchange of all
documents which the Borrower and the Bank intend to introduce at
the hearing and any expert reports prepared by any expert who will
testify at the hearing.
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(iv) Sequential
Hearing Days. At
the administrative conference conducted by the AAA, the Borrower
and the Bank and the AAA shall determine how to ensure that the
hearing is started and completed on sequential hearing days.
Potential arbitrators shall be informed of the anticipated length
of the hearing and they shall not be subject to appointment unless
they agree to abide by the parties’ intent that, absent
exigent circumstances, the hearing shall be conducted on sequential
days.
(v) Award.
The award of the arbitrator(s) shall be accompanied by a statement
of the reasons
upon which such award is based.
(vi) Fees
and Expenses. The
Borrower and the Bank shall each bear equally all fees and costs
and expenses of the arbitration, and each shall bear its own legal
fees and expenses and the costs of its experts and witnesses;
provided, however, that if the arbitration panel shall award to a
party substantially all relief sought by such party, then,
notwithstanding any applicable governing law provisions, the other
party shall pay all costs, fees and expenses incurred by the
prevailing party and such costs, fees and expenses shall be
included in such award.
(vii) Confidentiality
of Disputes. The
entire procedure shall be confidential and none of the parties nor
arbitrator(s) may disclose the existence, content, or results of
any arbitration hereunder without the written consent of all
parties to the Dispute, except (i) to
the extent disclosure is required to enforce any applicable
arbitration award or may otherwise be required by
law and
(ii) that either party may make such disclosures to its regulators,
auditors, accountants, attorneys and insurance representatives. No
conduct, statements, promises, offers, views, or opinions of any
party involved in an arbitration hereunder shall be discoverable or
admissible for any purposes in litigation or other proceedings
involving the parties to the Dispute and shall not be disclosed to
anyone not an agent, employee, expert, witness, or representative
for any of such parties.
(viii) CLASS
ACTION WAIVER. THE
BORROWER HEREBY WAIVES, WITH RESPECT TO ANY DISPUTE: (I) THE RIGHT
TO PARTICIPATE IN A CLASS ACTION, PRIVATE ATTORNEY GENERAL ACTION
OR OTHER REPRESENTATIVE ACTION IN COURT OR IN ARBITRATION, EITHER
AS A CLASS REPRESENTATIVE OR CLASS MEMBER; AND (II) THE RIGHT TO
JOIN OR CONSOLIDATE CLAIMS WITH CLAIMS OF
ANY OTHER PERSON. The
foregoing waiver is referred to herein as the
“class
action waiver”.
The Bank and the Borrower agree that no arbitrator shall have
authority to conduct any arbitration in violation of the class
action waiver or to issue any relief that applies to any person or
entity other than the Borrower and/or the Bank individually. The
parties acknowledge that this class action waiver is material and
essential to the arbitration of any claims and is non-severable
from this Dispute Resolution section. If the class action waiver is
voided, found unenforceable, or limited with respect to any claim
for which the Borrower seeks class-wide relief, then this Dispute
Resolution section (except for this sentence) shall be null and
void with respect to such claim, subject to the right to appeal the
limitation or invalidation of the class action waiver. However,
this Dispute Resolution section shall remain valid with respect to
all other claims and Disputes. The parties acknowledge and agree
that under no circumstances will a class action be
arbitrated.
(ix) Applicability
of Federal Arbitration Act. This
Note evidences transaction(s) in interstate commerce, and thus the
Federal Arbitration Act governs the interpretation and enforcement
of this Dispute Resolution section.
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
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If the Borrower is a legal entity, the undersigned certifies to the
Bank that the undersigned (individually and collectively if more
than one, the “Authorized Representative”) is and was
authorized and directed to (i) execute and deliver, including to
electronically execute and deliver, in the name of and on behalf of
the Borrower, this Note and any other documents executed in
connection with this Note or the Facility, all in such form as may
be requested by the Bank or required under the Program and any of
which may contain a provision waiving the right to trial by jury;
(ii) execute and deliver to or in favor of, including to
electronically execute and deliver to or in favor of, the Bank any
amendments, modifications, renewals or supplements of or to any of
the foregoing agreements, documents or instruments; (iii) take any
other action requested, required or deemed advisable by the Bank in
order to effectuate the foregoing; and (iv) delegate the foregoing
duties to other representatives of the Borrower. The undersigned
further certifies that the Authorized Representative holds the
office, title or status with the Borrower specified below the
Authorized Representative’s signature.
The Borrower acknowledges that it has read and understands all the
provisions of this Note, including the waiver of jury trial,
arbitration and class action waiver, and has been advised by
counsel as necessary or appropriate, or has elected not to seek the
advice of counsel.
WITNESS the
due execution hereof as a document under seal, as of the date first
written above, with the intent to be legally bound
hereby.
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AUTOWEB, INC.
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By: /s/ Jared
Rowe
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Jared Rowe, Chief Executive Officer
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By:
/s/ Joseph Hannon
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Joseph P. Hannon, Chief Financial Officer
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EXHIBIT A
TO PAYCHECK PROTECTION PROGRAM TERM NOTE
DISBURSEMENT AND PAYMENT AUTHORIZATION
INSTRUCTIONS
Loan Disbursement Authorization:
Borrower authorizes and directs the Bank to disburse the proceeds
of the Facility as directed below. Each authorized representative
of the Borrower is authorized to make this request, the Bank is
entitled to rely conclusively on the below instructions to make
disbursements in the amount and manner
specified.
Disbursements
Disburse the proceeds of the Facility into the Borrower’s
demand deposit account with PNC Bank, Account No.
[Redacted]
Automatic Payment Authorization Under Facility:
The Borrower irrevocably authorizes and directs the Bank to charge
any deposit account identified above and maintained at the Bank (or
such other account at the Bank as the undersigned may designate to
the Bank in writing from time to time) for all payments of
principal and interest due or fees on the Facility, and to debit
such account for the amount of such payments on the date each
payment is due. The Borrower acknowledges and agrees that, to the
extent there are insufficient funds in any such account to pay the
required amounts when due, the Borrower shall immediately pay to
the Bank all sums remaining unpaid. This authorization supplements,
and does not limit, the Bank’s rights under the promissory
note(s) and other documents evidencing or securing the Facility.
The Bank is entitled to rely conclusively on this authorization
until this authorization is terminated by the Bank or the Borrower,
and the Bank has had a reasonable time to act
thereon.
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Paycheck Protection Program Certification
April 16, 2020
AUTOWEB,
INC. (the “Borrower”)
has applied to PNC Bank, National Association (the
“Bank”) for
a Small Business Association (“SBA”)
7(a) Paycheck Protection Program loan (the
“PPP
Loan”).
The below signer understands that the statements made in this
certification are part of the agreement with the Bank and that the
Bank will rely on these statements when deciding whether or not to
make the PPP Loan.
I certify, acknowledge and agree that I am an authorized officer of
the Borrower and am authorized on behalf of the Borrower to certify
to the statements provided in this application, and that the
following are true and correct statements:
1.
The Borrower was in operation on February 15, 2020 and, if Borrower
is not a self-employed worker or independent contractor, had
employees for whom it paid salaries and payroll taxes or paid
independent contractors, as reported on a Form
1099-MISC.
2.
The uncertainty of current economic conditions makes necessary the
PPP Loan request to support the ongoing operations of the
Borrower.
3.
The
proceeds of the PPP Loan will (a) solely be used to retain workers
and maintain payroll or make mortgage interest payments, lease
payments, and utility payments (the
“Permitted Loan
Purpose”),
and (b) be allocated as set forth in the Borrower’s
application for the PPP Loan. At least 75 percent of the proceeds
of the PPP Loan will be used for payroll expenses. If the funds are
knowingly used for unauthorized purposes, the federal government
may hold the undersigned and the Borrower legally liable such as
for charges of fraud.
4.
Documentation verifying the number of full-time equivalent
employees on the Borrower's payroll as well as the dollar amounts
of payroll costs, covered mortgage interest payments, covered rent
payments, and covered utilities for the eight week period following
the disbursement of the PPP Loan will be provided to the
Bank.
5.
The Borrower understands and agrees that loan forgiveness may be
provided if the Borrower uses all of the loan proceeds for the
Permitted Loan Purpose. The actual amount forgiven will be
determined in accordance with the requirements of the Program,
including the provisions of Section 1106 of the Coronavirus Aid,
Relief, and Economic Security Act (CARES Act) (P.L. 116-136), and
in no event may more than 25 percent of the forgiven amount be
attributable to non-payroll costs.
6.
The
Borrower does not have any other PPP Loan applications pending and
will not apply for another PPP Loan. During the period beginning on
February 15, 2020 and ending on December 31,
2020 Borrower
has not received and will not receive another PPP
Loan.
7.
The Borrower shall notify the Bank if the Borrower received an EIDL
between January 31, 2020 and April 3, 2020 and the proceeds of such
EIDL were or are used to retain workers and maintain payroll; the
proceeds of the PPP Loan must be used to refinance any such
EIDL.
8.
The information provided in the PPP Loan application and the
information provided in all supporting documents and forms is true
and accurate in all material respects. The Borrower and the
undersigned understand that knowingly making a false statement to
obtain a guaranteed loan from SBA is punishable under the law,
including under 18 USC 1001 and 3571 by imprisonment of not more
than five years and/or a fine of up to $250,000; under 15 USC 645
by imprisonment of not more than two years and/or a fine of not
more than $5,000; and, if submitted to a federally insured
institution, under 18 USC 1014 by imprisonment of not more than
thirty years and/or a fine of not more than
$1,000,000.
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9.
The
Borrower acknowledges that the Bank will confirm the eligible PPP
Loan amount using the Borrower’s tax information that it has
submitted, including without limitation, tax returns and tax
transcripts (collectively, the “Tax
Information”).
The Borrower affirms that the Tax Information is identical to that
submitted to the Internal Revenue Service. The Borrower also
understands, acknowledges, and agrees that the Bank can share the
Borrower’s Tax Information with (i) the SBA’s
authorized representatives, including authorized representatives of
the SBA Office of Inspector General, (ii) the Bank’s
affiliates, and its and their respective directors, officers,
employees, agents and advisors (the “Representatives”),
and (iii) any actual or potential owners of a credit facility
extended by the Bank or its Representatives to the Borrower, any
acquirers of any beneficial or other interest in such credit
facility, guarantor, servicers or service providers for such
parties, and their successors and/or assigns (the
“Other
Loan Participants”)
for the purpose of (w) compliance with SBA Loan Program
Requirements and all SBA reviews, (x) originating,
maintaining, managing, monitoring, servicing, selling, insuring,
and securitizing a credit facility; (y) enforcing any of its rights
or remedies under the loan documents applicable to such credit
facility (including, without limitation, in connection with any
collection action related thereto) or (z) as otherwise permitted by
applicable laws, including state and federal privacy and data
security laws, or if required to do so by legal process, regulation
or law, or in defense of any claims or causes of action against the
Bank or any of its Representatives.
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AUTOWEB, INC.
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By: /s/ Jared
Rowe
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Jared Rowe, Chief Executive Officer
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By:
/s/ Joseph
Hannon
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Joseph P. Hannon, Chief Financial Officer
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